"Life is a series of
natural and spontaneous changes. Don't resist them - that only creates sorrow.
Let reality be reality. Let things flow naturally forward in whatever way they
like."
- Lao Tzu (Chinese5th or 6th
Century BC)
Word for the day
Twitterpated (adj)
Excited or overcome by
romantic feelings; smitten.
(Source: Dictionary.com)
Malice towards
none
Should the government call
for a national referendum on the issue of a unified market for the country
(GST)?
Sad and scary
Three news items in past one week have been disconcerting indeed.
Though not surprised, I feel sad to see that my worst fears are coming out to
be true. These three news items reflect a certain degree of incongruence, lack
of cohesion, inconsistency and adhocism in functioning of the government of the
day.
The first news item relates to the proposal under consideration
for making it compulsory for sugar mills to export millions of tonnes of
surplus supplies to support local prices. (see
here)
In past one decade, sugar industry has seen negligible addition in
cane crushing capacity. Most of the mills are reeling under losses and reported
to have unpaid cane arrears in excess of INR20bn. No bank is willing to extend
credit to these beleaguered mills. Many mills in fact are reportedly
considering not to operate in the forthcoming crushing season (see
here). Food inflation continues to be high and RBI has expressed concerns
over this in its latest policy statement (see
here). The global sugar prices have corrected over 40% from the recent
highs (see
here). No state government is willing to review their cane pricing
mechanism.
Under these circumstances, how the exports of sugar will help
anyone. This will add to the global glut pushing the prices further down and
make Indian producers even more uncompetitive in midterm, besides adding to
inflationary pressure in the short term. There is no guarantee that after
clearing the stock and repaying debt to the farmers and banks, the mills will
remain viable and/or would be prepared to produce more. The situation will be
same as in case of state electricity board. Despite whatever reforms and
restructuring every time, they remain in deep s**t.
The second news item (see
here) relates to the unavailability of a major part of the 87GW power
generation capacity created over the last 6yrs due to lack of fuel linkages or
buyers. Approximately 10GW of gas-based projects are completely stranded due to
non-availability of sufficient gas to run them. Some 16GW based on imported
fuel is at risk since costs can’t be passed on and another 13GW is facing
inadequate coal supply.
One fails to understand how "Make in India" and
"Skill India" could even be fathomed without these power capacities
operating at full capacity. Instead, the government is pouring humongous
investment in expensive solar and wind power energy (see
here).
Third news item (rather a series of news items) relates to government's
failure in getting the Parliament to function. The principal opposition
Congress Party had made its intentions clear well in advance. Despite this the
government did not have a plan. Instead of giving it back to the opposition,
the ruling party leaders appeared happy playing victim, rather bizarrely.
Masochism is the word for their disposition.
It appears that perhaps they also do not want critical bills
having implications on state center relationship (GST and Land Bill) being
discussed in the Parliament before Bihar election. BJP still seems to be
suffering from the idea that they lost Delhi election due to Land Acquisition
Ordinance.
This, if true, is a sad and scary commentary on the state of
political affairs in the country.
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