Shadowboxing in India-U.S.

ties
Something always seems to come in the way of India and the United States finding
the groove in their relationship. Attempts by the two sides to inject some
enthusiasm into bilateral ties despite the spat over the diplomat Devyani
Khobragade and the U.S.s past coldness toward Prime Minister Narendra Modi on
the issue of the Gujarat riots, seem jinxed. The revelation that the U.S. National
Security Agency had sought and received official permission to put the Bharatiya
Janata Party under surveillance in 2010 is the latest hiccup. It overshadowed the
visit by Republican Senator John McCain, chairman of the House Committee on
Foreign Affairs. The disclosures were part of the latest cache of data released by
whistle-blower Edward Snowden through The Washington Post. From what is
available in the public domain so far, it is not clear what methods of surveillance
were used, and which particular individuals in the party were being targeted. That
this was four years before the BJP became the ruling party makes it curiouser. There
is, however, nothing particularly surprising in the disclosure. Virtually every country
spies on every other, and in the process spares no one of any importance.
Espionage is among the oldest professions. Only, the methods have become more
advanced and a countrys resources determine how advanced its technologies are.
It is just that the U.S. gets outed more frequently than any other. Describing the
surveillance as unacceptable, India summoned senior U.S. diplomats, apparently
to tick them off. But New Delhi cannot in all honesty say that it does not spy on
political parties in other countries, or even within. So the protest should not be
mistaken for a moral stand that there should be no espionage.
What the revelations have done is to create further negativity about the U.S. in the
Indian mind, thus making it politically difficult for the two governments to put the
past behind them quickly. As it is, a cloud hangs over bilateral relations over the
Khobragade episode. Though the Obama administration has made it clear that the
Prime Minister would receive a red-carpet welcome in Washington in September,
the cancellation of a visa to Mr. Modi when he was Chief Minister has not been
forgotten. From all the outreach to Indias South Asian neighbours, and to China,
Russia, France and Singapore, New Delhi also seems to be sending out the message
that its foreign policy priorities are different from its predecessors. Assistant
Secretary of State Nisha Biswals visit to make contact with the new government
was upstaged by the high-profile arrival of the Chinese Foreign Minister. But good
U.S.-India ties are in the enlightened national interest of both sides. A way must
be found to break the ice before the September Washington summit.
India as emerging economy

India is resisting the move as it will halve limits on food subsidies, force dependence
on U.S. imports
The crisis at the World Trade Organisation (WTO) talks in Geneva has deepened
with the United States demanding India and China be categorised as emerging
rather than as developing economies. India is resisting the move which, if it
materialises, will halve WTO caps applicable to Indias food subsidies. It will also
require India to grant market access to the U.S. The U.S. is insisting that India meet
its food security law obligations with American imports, Commerce Ministry
sources told The Hindu.
The U.S. insists that economies such as India and Indonesia with high rates of
growth can no longer be categorised as developing countries, the sources said.
Indias stand is that going by per capita income it is actually the worlds largest
Least Developed Country where about 600 million live at less than $2 a day, the
sources said.
The U.S. has also tabled a study in Geneva, produced by its allies Pakistan and
Canada, that claims food subsidies in India and China exceed those in the U.S. and
the EU, sources said. India has countered the study, the sources added, with data
to show that the U.S. farm subsidies to its corporate sector are to the tune of
$20,000 to $30,000 per capita per year against Indias mere $200.
Besides, Indias subsidies go to subsistence farmers, said the sources, To say that
the subsidies that India and China give are greater than what the U.S. gives is over
the top.
At the Geneva talks, the U.S. has so far successfully thwarted Indias efforts aimed
at finding a permanent protection against even the WTOs agriculture caps
currently applicable to its food subsidies. Americas own agenda of an agreement
on Trade Facilitation, however, is well on track for the July 31 deadline as laid down
at the Bali Ministerial.
The U.S. is seeking to muddy the waters on the issue of subsidies in order to cause
delays as it is in no position to give a commitment on the issue. The U.S. is engaged
in its own domestic political arithmetic over the rejig of its Farm Bill and subsidies,
it is not in a position to negotiate on the matter in Geneva, the source said.
Emerging economy categorisation at the WTO will lower the agriculture subsidy
caps applicable to India from 10 per cent to 5 per cent
The developing countries have managed a complete vilification by indulging in half
truths; India needs to put forth its points more forcefully at Geneva, said Biswajit
Dhar, Professor of Economics at Jawaharlal Nehru University.
Fighting food inflation

The government believes that the expectation of a poor monsoon and consequent
fall in harvests has encouraged traders and middlemen to hoard food staples such
as onion and potato.
For a government that rode to power on the back of widespread dissatisfaction
among people over runaway prices, especially of food commodities, the rising cost
of onion and potato are posing a major challenge now. Though there is no reason
to panic yet, as Finance Minister Arun Jaitley said after addressing a meeting of
State Food Ministers, there is little doubt that there is cause for concern mainly
because the monsoon is playing truant. After its poor performance in June, the
revival in July has been patchy, fuelling inflationary expectations in foodgrains and
vegetables. The government believes that the expectation of a poor monsoon and
consequent fall in harvests has encouraged traders and middlemen to hoard food
staples such as onion and potato. The decision to bring the two vegetables under
the purview of the Essential Commodities Act and imposing stock limits on them is
a direct result of this reading. Simultaneously, the government has increased the
minimum export price of onion to $500 a tonne; the earlier level of $300 a tonne
has not been effective enough. India is one of the largest onion exporters in the
world, and last year it shipped out about 1.3 million tonnes of the bulb which
was a little less than 10 per cent of the countrys total output.
The move to set stock limits could also be a strategy to co-opt State governments
in the fight against inflation because the role of the Centre is limited to notifying
the commodity under the Essential Commodities Act. Setting of actual stock limits
and cracking down on hoarders are entirely under the purview of the States. The
Centre will need to work in tandem with State governments on the issue of fighting
food inflation because most levers to reform the supply chain are with them.
Whether it is reforming procurement practices or minimising the role of
middlemen or amending the Agricultural Produce Marketing Committee Act, the
power is all with the States. At this point in time, the Centre is waging a
psychological battle to douse expectations of a shortage in food commodities due
to the poor monsoon, but if the monsoon fails to revive in the next couple of weeks,
it will have a real fight on its hands. What should lend comfort though is the large
stocks of foodgrains that it is carrying it has already allocated an additional 50
lakh tonnes of rice for PDS distribution. The fight against food inflation is critical for
the government as it will have an impact on the monetary policy of the Reserve
Bank of India. Food inflation rebounded in May to 9.50 per cent after a slight dip in
April, and the June data are unlikely to be encouraging which means that easier
interest rates to spur growth are now that much more distant.
Weak foundations

Buildings in cities are collapsing with depressing regularity, and precious lives are
being lost. Two recent tragic incidents have yet again raised the issues of safety and
accountability in building construction. On June 28, on the outskirts of Chennai, an
11-storey building under construction collapsed, and some 61 people died. In Delhi,
a four-storied building crumbled and 10 persons including five children lost their
lives. In the Chennai incident, the promoter of the apartment project blamed a
lightning strike for the tragedy, but State agencies, builders organisations and
architect groups pointed to poor design, non-compliance with rules and negligence
as the reasons. The police arrested six persons including the developer, the
architect and the engineer. The Tamil Nadu government has appointed a one-man
commission headed by a retired High Court Judge to investigate the incident and
suggest measures to prevent such calamities in future. In the case of the Delhi
incident, survivors had complained that construction work nearby had weakened
the foundation. The Municipal Corporation, the reports indicate, ignored their
protests. In a delayed reaction, the Corporation has suspended the engineers in
charge until enquiries are completed. Every time such accidents occur, the state
rushes forth to form committees and enacts new rules, only to ignore them later.
Nothing has improved the situation on the ground, and the lessons have hardly
been learnt.
The issue is not that of insufficient regulatory systems or safety standards, but that
of non-compliance. For instance, in Chennai, building approval procedures for
multi-storied buildings clearly mandate that the regulatory authorities verify soil
analysis reports, structural drawings, stability certificates and design drawings
before issuing approvals. Had the officials diligently scrutinised the drawings and
the data, they could have detected the inadequacies, if any, even before
construction commenced. Periodic inspection of buildings would have helped spot
deviations and other problems at the construction stage. In Delhi, had the
Corporation acted on residents complaints and taken prompt action, lives would
have been saved. The need of the hour is to review and rigorously implement the
existing rules. Frequent regularisation of unauthorised constructions have
emboldened violators and eroded the compliance culture. Lack of transparency in
approval processes, discretionary exemptions, and slack inspections have put the
interests of many apartment-buyers in peril. Construction workers often bear the
worst of the effects, and lose lives and limbs. Safety measures at construction sites
and compliance with design standards are not matters that are up for negotiation.
We need a zero-tolerance policy when it comes to unsafe building practices.