Anarcho-environmentalism allegorised

The name Anaarkali in the present context has many meanings - Anaar symbolises the anarchism of the Bhils and kali which means flower bud in Hindi stands for their traditional environmentalism. Anaar in Hindi can also mean the fruit pomegranate which is said to be a panacea for many ills as in the Hindi idiom - "Ek anar sou bimar - One pomegranate for a hundred ill people"! - which describes a situation in which there is only one remedy available for giving to a hundred ill people and so the problem is who to give it to. Thus this name indicates that anarcho-environmentalism is the only cure for the many diseases of modern development! Similarly kali can also imply a budding anarcho-environmentalist movement. Finally according to a legend that is considered to be apocryphal by historians Anarkali was the lover of Prince Salim who was later to become the Mughal emperor Jehangir. Emperor Akbar did not approve of this romance of his son and ordered Anarkali to be bricked in alive into a wall in Lahore in Pakistan but she escaped. Allegorically this means that anarcho-environmentalists can succeed in bringing about the escape of humankind from the self-destructive love of modern development that it is enamoured of at the moment and they will do this by simultaneously supporting women's struggles for their rights.

Friday, July 21, 2017

Chronicles of Constructive Time!!

The late Shankar Guha Niyogi, one of the founder activists of the Chhattisgarh Mukti Morcha, had coined the phrase "Sangharsh aur Nirman" which meant struggle and constructive action. He said that just engaging in action for rights and political power was not enough as mass organisations must also take part in constructive activities in the sphere of education, health and livelihoods to give practical shape to their alternative vision of development. Guha Niyogi was a phenomenal leader and so he succeeded in enthusing his colleagues in the Chhattisgarh Mukti Morcha to do a high level of both Sangharsh and Nirman simultaneously. Inspired by him we too tried to do the same among the Bhil Adivasis in western Madhya Pradesh. However, not being of the same calibre as Guha Niyogi we invariably ended up doing more of struggle and so constructive activities took a back seat.
Then in 2001 things changed drastically. Our mobilisation for Adivasi self rule in Udainagar Tehsil of Dewas district which had gained considerable strength and had resulted in village councils effectively running their affairs on their own, sidelining the government, was brutally crushed by the State through heavy police action in which four of our colleagues were killed in police firing and scores of us were jailed. After coming out from jail after a couple of months, I found that not only was the organisation in a shambles due to the heavy repression but that all the main activists, including I, had dozens of criminal cases foisted on us which we would have to fight in the courts. Since my Adivasi colleagues obviously didn't have the resources to fight these cases on their own, it fell to me to mobilise the huge funds required to fight so many criminal cases involving so many people. So I had to give up mass mobilisation work altogether and busy myself with doing research consultancy projects to earn money to fight the cases and also read statute books and case law to bolster up our defence in court. After a few years, from 2005 onwards, many new laws were enacted like Right to Information Act, Forest Rights Act, Mahatma Gandhi National Rural Employment Guarantee Act, Panchayat Extension to Scheduled Areas Act and the like which gave people rights for which they had to go to jail earlier. Indeed it was the earlier political agitations across India that resulted in the enactment of these progressive laws. So a whole new field of activity to implement these laws was opened up. This is when my Adivasi colleagues suggested that we should activate an NGO named Dhas Gramin Vikas Kendra that we had registered long back in 1987 but which we had never used for development work except in the early stages because we were too busy fighting for rights and going to jail and which was consequently lying dormant. So from 2007 onwards we began work with gusto in constructive activities in the spheres of education, health and forest, soil and water conservation apart from the implementation of the progressive laws. Thus instead of Sangharsh, Nirman became our buzz word.
The world of NGOism through which Nirman has to be carried out is such, that it is very important to write about the constructive activities being done and publicise them in order to gain visibility and garner the considerable funds required for the development work. So I began writing profusely about our work but getting it published was not easy. Newspapers and Journals most often either rejected my writings or demanded that I make substantial changes which were not to my liking. This is when a friend, who is a blogger, suggested that I should start blogging about our work. That is how this blog came into existence in 2007. It proved to be a great move because I was able to write and publish about our work on this blog and broadcast it to the world without having to wait for long periods to see it published and then face either rejection or drastic editing. This also helped us to get in touch with many people around the world and exchange ideas with them and so enrich our work. We took up new fields of activity, the most important being climate change mitigation and reproductive health work.
In the sphere of climate change mitigation we not only do a lot of work in rural areas but also our office in the city of Indore is designed to be as environment friendly as possible and provide us with enough opportunities of doing hard productive manual labour while staying in the city. One such project of ours is recycling urban waste from our office to rural farms. In our office cum residence in Indore all the green waste from the kitchen and the ground and terrace gardens is composted in a tank on the roof. Then every year before the monsoons this composted waste is taken out and transported to farms in the villages to enrich the soil there. This activity is highly labour intensive and so helps in keeping one fit, especially taking out the compost from the tank on the roof and taking it down to the ground for transport to the farm as shown below.
In all this time since 2001 I have not taken part in any mass political action at the grassroots against the many perfidies of the Indian state and the ruling class and so have not been incarcerated like earlier and neither have I been part of any wider political mobilisation. I have just fought and won the criminal cases against us and a few public interest litigations. Most of the time being spent in many constructive activities like the one above in Indore and its neighbouring areas and doing research. I even managed to do a Phd in environmental planning in this period based on the water resource management work that we do!! That was an education in itself because the world of academic research has its own rules which do not tally with the rules of grassroots activist work!!
 All the while I have written about our work in this blog and with this the 500th post I complete ten years of blogging. Before this I had written a book "Recovering the Lost Tongue" on the two decades of activism among the Bhils upto 2001 and dubbed it as the chronicles of savoured time as a counter to the title of the author Malcom Muggeridge's autobiography - "Chronicles of Wasted Time". This is because I had savoured a new anarchist and happy life among the Bhils vastly different from the one that I had led earlier. The writing in this blog I now dub as chronicles of constructive time because I have over the past decade done hugely personally satisfying work in pursuing alternative development models.

Tuesday, July 18, 2017

Demonetisation - A Multi Episode SitCom!!

The black comedy of Demonetisation continues and the Governor of the Reserve Bank of India is now the latest clown in the show!! In an astounding statement before the Parliamentary Standing Committee on Finance on July 6th 2017, the Governor of the Reserve Bank of India (RBI) said that he could not give them an official number as to how much money was deposited in old demonetised notes because counting was still in progress!! This beats all logic. At each and every step from the first bank counter where citizens deposited these demonetised notes, they have been counted numerous times and so definitely a number exists as to how many of such notes have been deposited. All the banks have submitted data not only on the total amount of money deposited but also the details of bank accounts in which more than the prescribed limits for such deposits have been made. So the data is definitely there with the bank and the final counting of the notes at the RBI central office will not alter that data in any significant way.

Then why is the RBI not revealing the data as to how much demonetised money was deposited even after more than six months have elapsed since the deadline for such deposits? The main reason is that contrary to the expectation that at least half, if not more, of the demonetised notes would not be deposited, almost all and according to some who are privy to the data even more than the total notes officially in circulation were deposited!! The rough estimate that the RBI had was of Rs 15 lakh crore or so of demonetised notes but it turns out that more than this has been deposited. This is embarrassing for the RBI because it hints at serious lack of oversight in printing and distributing notes if more than the estimated supply is actually in circulation.
The expectation of the Government was that people who had unaccounted for money would not deposit it in the banks as they would then become exposed as tax evaders and have to pay heavy penalties. But the people hoarding black money are so greedy that disregarding the consequences of doing so, they deposited all their money very much in excess of the Rs 2.5 lakh limit set by the RBI. In many cases dummy people with very little income were found and cash deposited in their accounts too. Apart from this there are many shell companies which are regularly used to layer transactions and convert black money into white and the accounts of these companies were also used to deposit black money.  In this way instead of the bonanza that the Government expected in the form of a huge cache of demonetised notes that would not be deposited leading to their value becoming an asset in the books of the RBI, the whole process has turned into a liability that is now being sought to be hidden behind the absurd fig leaf that the notes are still being counted!! Not surprisingly the Government has vehemently opposed the Supreme Court's suggestion that a window be opened again to allow some people who might have missed depositing their notes in the earlier period. The Government is saying that people unscrupulously resorted to various stratagems and deposited more notes than were actually officially in circulation and they would misuse this new opportunity also!!
The Income Tax department initially listed about 18 lakh individuals who had deposited more than Rs 2.5 lakhs of demonetised notes and sent them notices by email to explain how they had so much money. Very few of these people responded to these notices and the IT Department too, like the RBI, has become reticent and is not revealing any numbers!! But in bits and pieces it is coming out that not only has a lot of money been so deposited but they have also been deposited in bank accounts which had not been declared by these people in their earlier income tax returns. Thus, now the Government is claiming that due to the demonetisation exercise all this tax evasion has been detected and can now be acted on by the IT department because when these people file their returns for Assessment Year 2017-18 they will have to account for all this money in all these bank accounts and if they cannot do so then they will face penal action. Simultaneously action has been taken against shell companies and lakhs of them have been deregistered by the Registrar of Companies which has sent this data to the IT department for action after reconciling it with the data on the huge deposits of demonetised notes made in these companies' bank accounts.
However, was it necessary to submit the citizens of this country to so much trouble and subsequently disrupt the economy's growth path substantially to unearth all this tax evasion? Absolutely not. By making it mandatory to link the Income Tax permanent account number (PAN) to the universal identity Aadhar number and the bank accounts as is being done now and tracking the data on large cash deposits and tracking the shell companies diligently all this unaccounted economic activity could have been traced earlier. The black money that was demonetised was not held in cash in isolation. It continually went into the banking system and came out again to fuel economic activity. Thus, if a stringent system of heavy cash transaction tracking in banks, as is in place now, had been there earlier, then the flow of black money could have been traced with the use of advanced digital data mining. In fact there was a rule that any deposit greater than Rs 50,000 could only be made in a bank account after declaring the PAN of the depositor. If this data had been tracked diligently then all the duplicate PAN and shell company related deposits would have been unearthed. But no, Pied Piper Modi called the tune of demonetisation and all the rats in the government system followed him and drowned themselves in cash which they are now still counting!!!
Now that demonetisation itself has turned out to be a fiasco, the Government has turned its attention to such tracking methods and is giving demonetisation the credit for this new alertness to try and salvage something out of this costly mistake. However, this latest outrageous act of the RBI Governor of telling the Parliamentary Standing Committee on Finance that the notes are still being counted and so no official estimate of demonetisation is available has to be taken seriously. It is a telling comment on the state of Indian democracy that the opposition members in the committee which included the former Prime Minister Manmohan Singh, decided to crack jokes at the RBI's expense instead of moving a motion for breach of privilege against the Governor for willfully refusing to give the data on demonetisation. Prime Minister Modi once joked about the former Prime Minister Manmohan Singh that he was deft at using a raincoat even while taking a shower and so came out unscathed from all the scams being perpetrated during his tenure. But now Modi has gone one step further and is using the RBI Governor Urjit Patel as a raincoat for his own Tughlaqian misdemeanours.

Saturday, July 15, 2017

Learning Sustainable Living from the Bhils

The other day there was some discussion on Facebook on a post which had shared a link to an article by the social scientist Shiv Visvanathan praising the Ashrams or small community enclaves set up by Gandhi on the occasion of the centenary of the Sabarmati Ashram in Ahmedabad. Visvanathan wrote that we should revisit this concept of setting up ashrams today as a way to bring about a more sustainable socio-economic system. I pointed out in the discussion that ensued that these ashrams were never self sustaining and had to rely heavily on funding from capitalists and later after independence from the Government to survive and soon became moribund. There are a few such community enclaves around the world, which are self sustaining, but they are marginal and do not really pose a challenge to the rapacious capitalist system that now dominates the whole world.
I have from the very beginning of my life as an activist been against ashrams and have instead tried to see if communitarian living is not possible in rural areas on a larger scale in a natural way instead of in contrived communities. I was fortunate to start in the 1980s by living among the Bhils of Alirajpur who have practised sustainable albeit subsistence living for ages. For ten years I lived among them and we did a lot of things together at the subsistence level but also collectively improved the lives somewhat. Later, Subhadra and I lived for two years in a Bhil Adivasi area in Khargone district and there too we adapted to the living style of the Bhils. However, certain exigencies made us come to the city of Indore after that and for the past two decades or so we have lived a highly unsustainable urban life.
Now we have decided to jettison Indore and move to the villages again in a year or two and to this end have begun developing a farm and centre among the Bhil Adivasis in Pandutalav village in Dewas district nearby. Since now we frequently go to this farm and often stay there for a few days, we have once again come in close contact with the simple and sustainable lifestyle of the Bhils. Even in these times when the market economy and consumerism have penetrated deeply into the rural areas, the Bhils in Pandutalav which is situated just 50 kms from the city of Indore still live simply depending on their labour and the natural resources that they husband.
Our neighbour in Pandutalav, Raisingh, lives together along with his three sons and their families and they cultivate their land. Since they do not have much money they work hard on their fields. They have built a new house this year from wood, bamboo, mud and baked mud tiles. The whole family worked hard continuously for three months to first prepare the wood and the baked earth tiles and then set up the house. Occasionally, people from other households would also come to help in making the house. This is the custom among the Bhils as they pool in their labour to help each other.
The monsoons came early this year and so the house was not completely ready and had to be left half done as everyone got busy in sowing the seeds and doing the various other associated farming tasks. The whole family is busy now with some people working on the farm, others cooking the food and yet others taking the livestock for grazing. Most importantly someone has to stay back in the house and look after the small kids. So all this work is done very efficiently by apportioning responsibilities to various people in the household in a very democratic manner. Eventually, little money is required and efficient use of hard labour makes the household run like a well oiled machine.
The other day I watched with fascination as one of the women of the household not only took care of the children but also engaged in work to finish the house building work. Below is a photo of this idyllic scene.
  The woman in the background is plastering the walls with a cowdung cum mud mix which she has prepared in the foreground. The three small children of the extended family including her own child whom she has to take care of as the other adults are all working elsewhere have been put onto an improvised swing which she gives a push from time to time so that they are happy playing and leaving her to do her work.
This is what the Bhils have to teach us - do hard physical labour and use natural resources judiciously to live a simple  and productive life. They provide for themselves and also for others by producing the food that we all eat at a very cheap cost. So instead of revisiting the highly unsustainable ashrams that Gandhi set up, we need to learn from the Advasis across the country how to live together by helping each other, doing hard physical labour and taking as little from nature as possible and giving much more to human society than they take from it in the form of cheap food.

Thursday, July 13, 2017

The Water Wisdom of the Mughals

Burhanpur town on the banks of the River Tapti in the foothills of the Satpura Range was the southern outpost of the Mughals. Consequently, it had a massive garrison of soldiers numbering two lakhs and a supporting civilian population of around thirty thousand in the early seventeenth century when the Mughals not only wanted to defend their territory against possible incursions from southern kingdoms but also had plans to expand further south. Providing safe drinking water to this huge population was a major concern of the Mughal administrators. They feared that the water of the River Tapti and its tributary Utavali may be poisoned by their enemies and so they preferred the use of ground water. However, wells themselves could not provide enough water and also it was laborious to draw water out of them for such a large population in those days when there were no mechanised pumps.
The Subedar or Governor of Burhanpur Abdul Rahim Khankhana commissioned a Persian geologist Tabukul Arj to devise a system that would be able to harvest the rain water falling on the Satpura ranges and bring them by gravity to the town in 1615. A very ingenious plan was drawn up wherein a few large tanks named Mool Bhandara or main water store and Chintaharan Bhandara or tension free water store and Sookha Bhandara or dry water store were constructed to harvest the rain water and recharge it into the ground. Finally a 3.5 km long tunnel about thirty feet below the ground level, lined with marble, was constructed just uphill of the town into which the water from the three other Bhandaras seeped in through the ground as shown below.
Over the years the calcium and magnesium salts in the seeping water have been deposited on the walls of the tunnel as can be seen above and have reduced both the amount of water seeping in and the storage capacity from a supply level which was once as much as a million litres per day. There are 103 round wells that reach this tunnel from the top at intervals and provide access to it for cleaning it of any debris and sediments that might have accumulated. The water in the tunnel flows by gravity from the first well to the last well at the end of which there is a tank from which pipelines take the water to the town below. The wells are called kundis whereas the tunnel is called Khooni Bhandara possibly because of the slightly reddish colour of the water in it.
As the needs of Burhanpur grew in the twentieth century alternative mechanised water supply was implemented from the Utavali river leading to neglect of this gravity based system and it finally became defunct in 1977 due to clogging with sediment.
Then in 2001 the Burhanpur municipal corporation sought to revive the Khooni Bhandara and with funds collected from the local citizens and grant support from the Government the tunnel was cleaned and some of the wells that had collapsed were repaired. Water began seeping in again and currently about 0.15 million litres of water per day flows out of the tunnel. The lower flow of water is also due to the higher withdrawal of groundwater in the catchment through pumps. A lift has been installed in the third well which allows visitors to go down and see the tunnel which is how the photo above was taken.
What struck me most was the ingenuity of the Mughals in devising a system that first tapped the rain water by harvesting it and then used an underground tunnel to extract it and take it by gravity to the town. This was a necessity at the time because there were no mechanised pumps to do lift water from the underground aquifer at that time. This tunnel was dug by human labour obviously as there were no machines then and this adds to the uniqueness of the system. Even though the Burhanpur municipality finally had the sense to revive this historic system it has not had the further sense to replicate it in other areas around Burhanpur to make it completely independent of mechanised systems. Water harvesting is the most sustainable means of water supply. The municipality has beautified the area around the third well where visitors can pay a fee and descend into the well in the lift and also applied for world heritage status for the Khooni Bhandara. However, instead of just reviving it as a heritage which is no doubt laudable, the municipality would have set an even better example by replicating this fantastic sustainable water system devised by the Mughals for the whole water supply.

Wednesday, July 5, 2017

Anti Duffer Unlimited

When I first came to Alirajpur in 1985 to work among the Bhil Adivasis, I started off by teaching young children in a government primary school in the morning and conducting an adult education class in the evening. Both activities did not last long as I got involved in mass organisational work to build up a trade union of the Bhil farmers and labourers. However, ever since then, I have been involved with education of Adivasi children off and on. The striking thing that I first noted all those years ago was the abysmal standard of teaching in government schools in the Adivasi areas and their huge difference with the standard of the books that were prescribed. The main reason was that there were not enough teachers who were capable of teaching the prescribed books. In most cases there are single teacher schools with the teachers themselves being products of these schools and so unable to understand the books they were supposed to teach.
When we did get down to running some schools of our own we came up against this major constraint of lack of capable teachers. Whether it is the residential Rani Kajal Jeevan Shala in Kakrana or the single teacher schools in Vakner, Bada Amba and Chilakda, the basic education that the teachers had received when they were in school was so poor that despite being trained periodically they were not able to teach properly. Often I have gone and taught in these schools for a day or two to find that the children in a particular class were at a level of a few classes further down. There is no solution to this problem because it is next to impossible to get teachers in Adivasi areas capable of teaching the prescribed texts.
One of the programmes of the newly set up centre of the Mahila Jagat Lihaaz Samiti at Pandutalav village is to improve girls' education standards. What we have planned is that we will provide coaching classes to the girls studying in nearby schools at the secondary level from classes eight to twelve on weekends. For the past few weeks considerable publicity has been done in the nearby villages that Subhadra and I for starters, till others from Indore and elsewhere too decide to chip in, will provide coaching to girls in all subjects on saturdays and sundays and so they should come for this. The first class that was held under this programme had only four attendees as shown below!!
Why, despite the publicity done for the programme and the credibility Subhadra and I have in the area, did so few girls turn up? Thereby hangs a tale. We asked the girls which subjects they found most difficult and they said in one voice English and Maths. So we started with English only to find that even the girl in the twelfth class did not know a word of English. We started off with some basic sentences and as we worked through them we talked to the girls about how they were taught in class. It appears that after learning the alphabet in English they had never read or written anything in class. The teachers come and tell them to read as they themselves are unable to read the texts and just sit like dodos. The students then go home and do other things and don't touch their books at all. That is why most of the girls had not turned up because they didn't have any conception that there could be a teacher who would teach!! What is the point in going to a coaching class and sitting there all day without being taught after having done that through the week in school. This was a shocking revelation to us that students in adivasi areas can't believe that there can be teachers who can teach and make studying both a fun and a learning experience. The same was the situation with maths. Apart from tables up to ten or so and some rudimentary addition and subtraction the girls didn't know much. We had to spend a laborious few hours trying to make them understand how to multiply and divide. For the first time they had filled up their exercise books with so much writing and were enthused enough to say that they would go back home and practice what they had written and read.
One is left wondering about the farce that is being enacted in the name of education in Adivasi areas. The prescribed texts are of a high standard and unless they are taught well from the lower classes, the backlog of knowledge that builds up is near impossible to address in the higher classes. Since there is a no detention policy upto class ten when the first public examination is held, students are promoted through to class ten without being taught much. They come to accept that teachers do not teach and they need not learn. In the end what we have is a huge lot of young people who have been turned into duffers by an inappropriate education system. They are all very intelligent children who do a lot of thoughtful work on their fields and in their homes but when it comes to learning at school its just a waste of time and effort. So while the children of the rich go to schools where teachers do teach and they go on to become important cogs of the capitalist system, poor adivasi children are deliberately turned into duffers as they are NOT TAUGHT, due to lack of teachers, the same prescribed texts as the rich children.
In recent years there have been many projects to groom a few underprivileged children who have somehow learnt something in poor schools and help them to enter elite institutions like the Indian Institutes of Technology, with one of them being very famous by the name of Super Thirty. They do a laudable job by helping these few children put a foot into the edge of the closed door of opportunities in the capitalist world. But eventually these few children become part of the oppressive building and the door remains firmly shut for the vast majority.
Without some rudimentary education it is not possible for the Adivasis to forge a mass movement to break down the capitalist door and create a more just world. There is no need to become super intelligent in the paradigm of education designed by the rich in order to challenge their hegemony but at least the adivasi children must not become duffers. That is why instead of the super thirty we have launched a programme to ensure that we counter the invidious conspiracy of the capitalist state of converting adivasi children into duffers and have named it - Anti Duffer Unlimited.

Saturday, July 1, 2017

वस्तु एवं सेवा कर की हकीकत

1 जुलाई 2017 से भारत में वस्तु एवं सेवा कर, जिसे अङ्ग्रेज़ी में उसके नाम के संक्षिप्त रूप में GST कहा जाता है,  लागू हो जाएगा। सरकार का दावा है कि इससे करों की वसूली काफी सरल हो जाएगा एवं देश की अर्थव्यवस्था को गति मिलने के साथ साथ महंगाई एवं काले धन पर भी अंकुश लगेगा। इसलिए सरकार ने एक नारा दिया है इस नई कर प्रणाली के बारे में – "एक राष्ट्र, एक कर, एक बाज़ार"। यह जांचना आवश्यक है कि क्या हकीकत में यह सब होगा।
पूंजीवादी अर्थव्यवस्था में वस्तुओं एवं सेवाओं के विक्रय पर कर वसूलना एक गंभीर समस्या है। इन करों की वजह से महंगाई बढ़ती है और बाज़ार व्ययस्था में विकृतियाँ आती है। परंतु मुक्त बाज़ार आधारित पूंजीवादी अर्थव्यवस्था में पूंजीवादीओं के येन केन प्रकारेन मुनाफा कमाने की होड़ के कारण बीच बीच में ही संकट पैदा हो जाता है एवं इसलिए इसे धराशायी होने से बचाने के लिए सरकार द्वारा इसे नियंत्रित करना पड़ता है।  साथ ही अर्थ व्यवस्था में मांग को बरकरार रखने के लिए सरकार को अधोसंरचना के विकास एवं सेना पर निवेश करना होता है और विभिन्न आर्थिक और सामाजिक सेवाएँ प्रदान करना होता है। इस सब के लिए करों से ही सरकारें धन जुटाती है एवं इसके लिए एक भारी भरकम नौकरशाही भी होती है।
कर दो प्रकार के होते है – प्रत्यक्ष और अप्रत्यक्ष। व्यक्तियों और व्यापारिक संस्थानों के आय पर जो कर वसूला जाता है उसे प्रत्यक्ष कर कहा जाता है जबकि देश के अंदर उत्पादित व विदेश से आयातित वस्तुओं एवं सेवाओं पर लगाए गए कर को अप्रत्यक्ष कहा जाता है। आम तौर पर प्रत्यक्ष करों को प्रगतिशील कहा जाता है क्योंकि इंका बोझ अधिक आय वालों पर आनुपातिक रूप से अधिक होता है। अप्रत्यक्ष करों को सभी व्यक्तियों को समान दरों से  देना पड़ता है जब वे कोई वस्तु या सेवा को खरीदते है भले ही वे अमीर हो या गरीब और इसलिए गरीबों को अमीरों की तुलना में आनुपातिक रूप से उनके आय के एक अधिक हिस्सा अप्रत्यक्ष करों के रूप में देना पड़ता है एवं इसलिए इन्हे अप्रगतिशील कहा जाता है। इसके अलावा अप्रत्यक्ष करों के कारण महंगाई बढ़ती है व बाज़ार में विकृतियाँ आती है और इसलिए भी इन्हे प्रत्यक्ष करों की तुलना में अवांछनीय माना जाता है। परंतु क्योंकि केवल प्रत्यक्ष करों से सरकार द्वारा पर्याप्त धन नहीं जुटाया जा सकता है, विशेष कर भारत जैसे विकासशील देशों में जहां कई कारणों से प्रत्यक्ष कर देनेवालों की संख्या कम है, इसलिए अप्रत्यक्षा करों को भी लगाना पड़ता है।
स्वतन्त्रता के बाद से जैसे जैसे वस्तुओं और सेवाओं के उत्पादन में वृद्धी हुई है वैसे वैसे अप्रत्यक्ष करों का ढांचा और जटिल होते गया है क्योंकि अलग अलग वस्तुओं और सेवाओं के लिए अलग कर लगाए गए है एवम उन पर कभी छूट दिये गए है और कभी अधिभार भी लगाए गए है। भारत में स्थितियाँ और पेचीदा इसलिए हो गई है क्योंकि यहाँ एक संघीय राजनीतिक ढांचा है जिसमें केंद्र एवं राज्य सरकारों को कर लगाने के स्वतंत्र अधिकार है। इसलिए अप्रत्यक्ष करों का ढांचा अत्यंत जटिल होकर इनकी वसूली के लिए बड़ी समस्या खड़ी कर दी एवं बड़े पैमाने पर करों की चोरी होने लगी। अप्रत्यक्ष करों की चोरी के कारण व्यापारिक संस्थानों द्वारा अपने आय को भी कम बताकर प्रत्यक्ष करों की भी चोरी की जाने लगी। फल स्वरूप गत दो दशकों से अप्रत्यक्ष करों का ढांचा को और सरल एवं व्यापक बनाने के कई प्रयास किए गए है एवं GST का लागू होना इस क्रम में ताज़ातरीन कदम है।
अप्रत्यक्ष करों का बुनियादी शर्त है कि चाहे वस्तुओं और सेवाओं के कितने ही विविध प्रकार क्यों न हो, इसके केवल एक या अधिकतर दो दर होने चाहिए। यह इसलिए कि जैसे ही अधिक दरें होंगें वैसे ही इन करों की वसूली पेचीदा हो जाता है एवं कौन से वस्तु या सेवा पर कितना कर लगेगा इसको लेकर राजनीतिक खींचातानी एवं कानूनी लड़ाई चलती है जिससे कि करों का प्रबंधन कठिन व महंगा हो जाता है एवं भ्रष्टाचार के लिए रास्ता प्रशस्त हो जाता है। अगर किसी समुदाय को कोई विशेष रियायत पहुंचाना है तो यह अप्रत्यक्ष करों में विविधता लाकर या छूट देकर करने के बजाय, उस समुदाय को अनुदान देकर या उसके द्वारा अदा किया गया कर को वापस भुगतान कर किया जाना चाहिए। अगर किसी वस्तु या सेवा को हतोत्साहित करना हो, जैसे कि तंबाकू उत्पाद, तो इसके लिए उस उत्पाद को बनाने वाली कंपनियों के आय पर अधिक आय कर लगाकर यह काम किया जा सकता है बजाय इसके कि उसपर अधिक अप्रत्यक्ष कर लगाए जाये। इस प्रकार रियायत या हतोत्साहन एवं उससे जुड़े रजनीती का क्षेत्र अनुदान एवं प्रत्यक्ष कर हो जाएंगे और अप्रत्यक्ष कर बिलकुल सरल एवं रजनीती विहीन होंगें। साथ ही वर्तमान में अप्रत्यक्ष करों को लेकर चल रहे कानूनी विवाद भी खत्म हो जाएंगे व इन करों के कारण बाज़ार व्ययस्था में हो रही विकृतियां भी दूर हो जायगी।
फलस्वरूप अप्रत्यक्ष करों को वसूल करने के लिए भारी भरकम नौकरशाही की ज़रूरत नहीं होगी एवं इसे प्रत्यक्षा करों की वसूली में लगाया जा सकता है। एकबार अप्रत्यक्ष कर का ढांचा एक ही दर पर होगा तो इसे सर्वव्यापी कर सभी लेन देन पर लागू किया जा सकता है भले ही कितना छोटा क्यों न हो एवं इसलिए सभी व्यापारियों एवं व्यक्तियों के पूरे कारोबार घोषित होकर उनके द्वारा देय प्रत्यक्ष कर भी पूरा का पूरा सामने आ जाएगा। इस प्रकार न केवल अप्रत्यक्ष करों की वसूली बढ़ेगी बालके प्रत्यक्ष करों की वसूली भी बढ़ जाएगी। GST की वजह से बेशक अर्थव्यवस्था को काफी फायेदा होगा क्योंकि पूरे देश में एक प्रत्यक्ष कर होगा एवं कर चोरी पूरी तरह से बंद हो जाएगा पर इसके लिए GST का केवल एक ही दर होना चाहिए।
भारत में समस्या यह है कि यहाँ न केवल अनेकों प्रकार के अप्रत्यक्ष कर है बल्कि सभी करों के अनेक दरें भी है जिसमें अनेक प्रकार के छूट व अधिभार है। इसके अलावा राजनीतिक ढांचा संघीय होने के कारण केंद्र एवं राज्य सरकारों को स्वतंत्र रूप से कर लगाने का अधिकार है। केंद्र की तुलना में राज्य सरकारों के पास कर वसूलने की शक्तियाँ कम है एवं इसलिए वे हर वक्त वित्तीय संसाधनों की कमी से जूझती रहती है। वर्तमान में सभी राज्य सरकारें भारी भरकम कर्ज के बोझ के तले डूबे हुये है व बुरी तरह से केंद्र सरकार से प्रपट अनुदानों पर निर्भर है जो बहुत देर से प्राप्त होते है। इसलिए राज्य सरकारें करीब एक दशक से GST के विरोध करते आ रहे है क्योंकि वे अपने कर वसूलने का अधिकार में कमी नहीं करना चाहते है और न ही वे केंद्र के अनुदानों पर और अधिक निर्भर होना चाहते है। फलस्वरूप अब जब GST लागू हो गया है तब राज्यों के लिए सबसे अधिक संसाधन जुटाने वाले वस्तु, खनीज़ तेल के उत्पाद, भूमी एवं शराब, के विक्रय को जीएसटी से अलग रखा गया है एवं इस पर अभी भी राज्यों द्वारा अपने हिसाब से कर लगाया जाएगा। इसके अलावा अलग अलग वस्तु एवं सेवाओं को अलग अलग वर्गों में रखकर उनपर चार अलग दरों पर कर लगाया जाना है – 5, 12, 18, 28 प्रतिशत के दर से। इसके अलावा सोना और चांदी पर 3% के दर से कर लगाया गया है एवं कुछ वस्तुओं को करों से पूर्ण रूप में छूट दी गई है। इसके अलावा कई प्रकार के अधिभार भी लगाए गए है एवं एक ही वर्ग के वस्तुओं और सेवाओं पर, उनकी कीमत या प्रकार के आधार पर अलग अलग दर के कर लगाए गए है। इस प्रकार एक राष्ट्र एक कर एवं एक बाज़ार का नारा वास्तवायित नहीं हो पाया है। GST पहले की तुलना में बेहतर ज़रूर है परंतु यह अभी भी सरल नहीं है और न ही यह वर्तमान रूप में कर चोरी को रोकने में सफल हो पाएगा। इसलिए "एक राष्ट्र एक कर एवं एक बाज़ार" का नारा हकीकत में वास्तवायित नहीं हो पाया है।
अलग अलग वस्तुओं और सेवाओं पर करों का अलग अलग दर लगाने के लिए जो प्रमुख तर्क दिया जा रहा है वो यह है कि आम जरूरतों की वस्तुओं जिसे गरीब लोग उपयोग करते है एवं अय्याशी के वस्तुओं जिसे अमीर लोग उपयोग करते है को एक ही दर से कैसे करारोपित किया जा सकता है। परंतु जैसे कि पहले बताया जा चुका है यह एक गलत तर्क है। अगर गरीबों या किसी अन्य समुदाय को रियायत पहुंचाना है तो यह अनुदान से पहुंचाना चाहिए और अमीर वर्गों से अगर अधिक कर वसूलना है तो यह उनपर अधिक आय कर लगाकर करना चाहिए। GST में अलग अलग दर रखकर उसे और जटिल बनाने से अप्रत्यक्ष एवं प्रत्यक्ष करों की वसूली दोनों ही और कठिन हो जाता है एवं भ्रष्टाचार और कर चोरी को बढ़ावा मिलता है। इसके अलावा अधिक दरें होने के कारण बाज़ार व्यवस्था में विकृतियाँ आती है और इस प्रकार अर्थ व्यवस्था में कीमतें ऊंची रहती है।
एक दर एवं एक कर वाला GST लागू होने में एक और अड़चन है राज्यों की शंकाएँ। इस मसले को हल करने के लिए अब तक जो कर वसूलने के आंकड़े है उनका सांख्यिकी विश्लेषण कर यह पता करना चाहिए कि केंद्र और राज्य कुल कितना कर वसूलते आए है। इसके बाद एक सांख्यीकी सूत्र निकाला जा सकता है कि सभी वस्तुओं एवं करों पर केवल एक ही दर से कर अगर लगाया जाये तो वर्तमान में एकत्रित किए जा रहे कुल वित्तीय संसाधन के बराबर कर वसूलने के लिए यह दर क्या होनी चाहिए एवं एकत्रित संसाधन किस अनुपात में केंद्र एवं विभिन्न राज्य के सरकारों के बीच में आवंटित होने चाहिए। कर वसूलने का अधिकार एक स्वतंत्र निकाय को दिया जाना चाहिए जिसके संचालन की निगरानी केंद्र एवं राज्यों के प्रतिनीधिओं को मिलाकर बनी GST Council (वस्तु एवं सेवा कर परिषद) द्वारा किया जाना चाहिए ताकि राज्यों की यह शिकायत दूर हो सके कि उनका कर वसूलने का अधिकार खत्म हो रहा है एवं वे केंद्र के अनुदानों पर अत्यधिक निर्भर होते जा रहे है। वर्तमान व्यवस्था में अभी भी इसको लेकर स्पष्टता नही है कि कितने कारोबार के सीमा पर केंद्र या राज्य कर वसूलेंगे एवं इसको लेकर आगे चलकर विवाद होना तय है।  इसके अलावा यह प्रावधान भी है कि अगर किसी राज्य को GST की वजह से हानी होती है तो उसे इस हानी के लिए मुआवज़ा दिया जाएगा। यह प्रावधान इसलिए रखा गया है क्योंकि कुछ अधिक औद्योगिक उत्पादन करनेवाले राज्यों को शंका है कि GST उत्पादक के बजाय क्रेता से वसूले जाने के कारण उनकी कर वसूली कम हो जाएगी।
GST के एक समान दर का आंकलन करते वक्त यह ध्यान में रखना चाहिए कि इसके कारण जो सरल कर प्रणाली लागू होगी उसमें कर चोरी बिलकुल बंद हो जाएगी एवं इसलिए वर्तमान में हो रही प्रत्यक्ष एवं अप्रत्यक्ष कर वसूली में भारी बढ़ोत्तरी होगी एवं इसलिए वर्तमान में GST के औसत 18% दर के बजाय 7 से 10% के बीच में दर होगा जो बहुत अधिक नहीं है एवं यह सभी वस्तुओं एवं सेवाओं पर लगाया जा सकता है और कोई छूट देने की ज़रूरत नहीं है।
क्योंकि GST में अधिभार एवं छूट को लेकर करीब 8 अलग अलग दरें है इसलिए इनकी वसूली के लिए एक जटिल व्यवस्था खड़ी की गई है जो कम्प्युटर एवं इंटरनेट आधारित है  जिसे Goods and Services Tax Network (GSTN) कहा जाता है। इसका मूल मंत्र यह है कि सभी लेन देन के बिल के विवरण GSTN में अनिवार्य रूप से अपलोड करना होगा ताकि कोई भी लेन देन कर रहित न हो। कर वसूलने एवं उसके अभिलेख रखने की ज़िम्मेदारी अभी व्यापारियों पर आ गया है क्योंकि वे अगर ऐसा नहीं करेंगे तो उन्हें उनके द्वारा खरीदी किए जाने के समय चुकाया गया कर के लिए मान्यता नहीं मिलेगी जिसे input tax credit (ITC) कहा गया है। इस नई व्यवस्था को निम्न चित्र से समझा जा सकता है।

शुरुआत के लिए हम मान लेते है की निर्माता अपने द्वारा खरीदी गयी वस्तु व सेवाओं पर GST चुकाया है एवं यह उसके द्वारा उसके उत्पाद के तय किया गया 100 रुपये के कीमत में यह शामिल है। इस पर वह 5 % GST लगाकर उत्पाद को थोक विक्रेता को 105 रुपये में बेचता है। इसके बाद थोक विक्रेता उस उत्पाद कई कीमत 120 रुपये तय करता है एवं उस पर 5 % के दर से कर लगाकर उसे 126 रुपये  में खुदरा विक्रेता को बेचता है। क्योंकि उसने निर्माता से खरीदते वक्त 5 रुपये कर दे चुका है इसलिए वह इस राशि को ITC के रूप में लेता है एवं केवल 1 रुपये कर अदा करता है। खुदरा विक्रेता उत्पाद की कीमत 160 रुपये तय करता है एवं उसपर 5 % के दर से 8 रुपये कर लगाकर उसे ग्राहक को 168 रुपये में बेचता है। क्योंकि उसने 6 रुपये कर थोक विक्रेता को दे चुका है इसलिए वह इसका आईटीसी लेता है और केवल 2 रुपये शुद्ध कर अदा करता है। ग्राहक आखिरकार पूरा कर अदा करता है। इस प्रकार न केवल सभी लोग कर अदा करते है बल्कि यह कर केवल एक बार ही अदा किया जाता है एवं एक ही वस्तु पर बार बार पूरा कर नाही लगता है और सभी लेन देन पर कर चुकाया जाकर उसका अभिलेख तैयार हो जाता है जो GSTN में अपलोड हो जाता है एवं कर भी समय पर जमा हो जाता है।
हालांकि सिद्धान्त के रूप में यह बहुत अच्छा है पर हकीकत में इसके क्रियान्वयन में कई समस्यायें है जो निम्न प्रकार है –

1. सभी वस्तुओं को सांकेतिक क्रमांक दिये गए है जिनहे उनके अङ्ग्रेज़ी नाम के संक्षिप्त रूप में HSN कहा जाता है एवं सभी सेवाओं को भी इस प्रकार सांकेतिक क्रमांक दिये गए है जिनहे उनके अङ्ग्रेज़ी नाम के अनुसार एसएसी कहा जाता है। जब किसी व्यापारी किसी अन्य व्यापारी को वस्तु या सेवा बेचता है तो उसे बिल में उस खुद के GST क्रमांक क्रेता के GST क्रमांक एवं HSN या SAC क्रमांक दर्ज करना होगा एवं यह हर अलग वस्तु और सेवा के लिए करना होगा एवं यह लिखना होगा की कितनी कीमत ली गई है और कितना कर लिया गया है।  बाद में यह सभी विवरण एकत्रित कर महीने के अंत में GSTN में अपलोड करना होगा। यह सभी अङ्ग्रेज़ी में करना होगा एवं इनके प्रारूप अभी भी तैयार किए जा रहे है। फलस्वरूप इसके लिए जो सॉफ्टवेर चाहिए वो अभी भी बने नहीं है। इसके अलावा अब तक करों के विवरण अपलोड करने के लिए केवल 34 सुविधा इकाइयों को नियुक्त किया गया है जिनहे कुल मिलकर अरबों की संख्या में विवरह अपलोड करना होगा। अभी तक अधिकतर व्यापारी अङ्ग्रेज़ी और कम्प्युटर से दूर ही रहते थे परंतु अब उन्हे ऐसे लोगों को से मदद लेनी होगी जो यह काम कर सकते है और इससे उनके खर्चे बढ़ जाएंगे। ऊपर से सारे कारोबार को GSTN में दर्ज करने का मतलब है कि अघोषित कारोबार संभव ही नहीं होगा एवं इसके लिए भी व्यापारी तैयार नहीं है!!
2. भारत में अधिकतर कारोबार उधारी पर चलता है एवं व्यापारियों को भुगतान देर से मिलता है। सब से अधिक देरी सरकारी उपक्रम करते है। परंतु एक बार बिल बन जाने के बाद किसी व्यापारी को उस बिल में दर्शाये गए उसके द्वारा लिए गए कर को सरकार को चुकाना होगा भले ही उसे क्रेता ने भुगतान नहीं किया हो। इससे भी व्यापारी के लिए खर्चे बढ़ेंगे क्योंकि उसे और अधिक पूंजी की व्यवस्था करनी पढ़ेगी।
3. क्योंकि GST के विवरण अपलोड करना एक कठिन व खर्चीला काम है इसलिए 20 लाख रुपये से कम वार्षिक कारोबार वाले व्यापारियों को GST के दाएरे से बाहर रखा गया है एवं 75 लाख तक वार्षिक कारोबार करनेवालों को केवल उन्के द्वारा घोषित कारोबार पर 1 % कर चुकाना होगा एवं उन्हे कारोबार का विवरण GSTN पर अपलोड नहीं करना होगा। इस प्रकार बहुत सारे कारोबार का विवरण जीएसटी के दाएरे में नहीं होगा एवं उसके चलते कर चोरी का रास्ता बना रहेगा। इसके अलावा 75 लाख से अधिक वार्षिक कारोबार करने वाले कंपनियों को जब वे इन छोटे कंपनियों से कारोबार करते है तब उन कंपनियों से खरीदी हुई वस्तुओं और सेवाओं के लिए कर चुकाना होगा एवं इसके लिए बिल बनाकर GSTN पर अपलोड करना होगा और बाद में इसका ITC लेना होगा। इस प्रकार कर का भार इन बड़े कंपनियों पर अधिक पड़ेगा।  
4. ITC तब ही क्रेता को मिल पाएगा जब विक्रेता सही सही लेन देन का विवरण GSTN पर अपलोड करेगा और उसका कर सरकार को चुकायगा। क्योंकि इसमें कठिनाई है इसलिए कई बार गलत विवरण अपलोड हो सकता है और बिलकुल भी अपलोड नहीं हुआ हो ऐसा भी हो सकता है। इसके कारण भी व्यापारियों को पूंजी अधिक चाहिए होगा जिससे उनके खर्चे बढ़ जाएँगे।
5. भारत में अब तक गलत बिल बनाने की परंपरा रही है कर चोरी हेतु एवं इसके साथ ही वस्तुओं के परिवहन में भी बहुत हेराफेरी होती रही है। बिल में बताया कुछ जाता है और परिवहन द्वारा भेजा कुछ और जाता है। इस को रोकने के लिए GST में ewaybill का प्रावधान किया गया है जिसके तहत किसी भी वस्तु का परिवहन के पहले उसके बिल के विवरण एवं गंतव्य आदि ewaybill के रूप में तैयार करना होगा एवं यह ewaybill एक निश्चित अवधि के लिए वैध होगा। यह भी एक पेचीदगी भारी प्रावधान है एवं क्योंकि इसमें भी अङ्ग्रेज़ी और कम्प्युटर की ज़रूरत है इसलिए व्यापारियों को परेशानी होगी एवं उनके खर्चे बढ़ेंगे।

इसलिए अगर एक ही GST दर होता तो यह सब समस्याएँ खत्म हो जाती। क्योंकि सभी वस्तुओं और सेवाओं के लिए एक दर होने से उनका वर्गीकरण करने की कोई ज़रूरत न होती और न ही विस्तारित विवरण कम्प्युटर द्वारा अपलोड करना होता। केवल एक एसएमएस से GSTN में विक्रेता का क्रमांक एवं लेन देन की राशी भेजा जा सकता है। और सभी व्यापारियो और सभी कारोबार को दर्ज किया जा सकता चाहे वो छोटे से सब्जी ठेला क्यों न चला रहा हो। और तो और लेन देन का भुगतान भी मोबाइल फोन से किया जा सकता है एवं उसी समय उस लेनदेन पर लगाए गए कर का भी भुगतान सरकार को हो सकता है। एक अति सरल और पूर्ण रूप से पारदर्शी व्यवस्था कायम हो सकता है। अतः हकीकत में GST के वर्तमान रूप में अनेक समस्याएँ है जिसके कारण शुरुआत में काफी परेशानियाँ होगी। 

Thursday, June 29, 2017

Solar Power Blues

The support for stand alone solar photovoltaic residential electricity systems remains very poor in India. Especially when they have to be set up in remote locations which is where they are most needed. We recently installed a solar photovoltaic system along with a solar inverter in field centre of the Mahila Jagat Lihaaz Samiti in Pandutalav village. However, it is not functioning properly. The local supplier could not diagnose what the mistake was for quite some time. I then had to try and find out what was wrong by testing various parts with measuring devices which I had to buy. Finally it became clear that the solar inverter had some problem. This inverter is a special kind that maximises the use of solar input during the day also apart from charging the battery and was sourced from a German company having its office in Chennai. Since the ecosystem for solar inverters  is not well developed and their sales are not very high, obviously this company cannot have service centres all over India. So the solar inverter has now been sent to the company office in Chennai for testing and repair which means a down time of around ten days at least. In the meanwhile our centre will remain in the dark!!

Setting up a solar system is costly as with panels, inverter and battery the cost of the system comes to about Rs 80 per rated watt. Actual power output averaged over the year is much less than the rated wattage due to variations in solar insolation with seasons and so the actual cost is much more. If on top of that there are problems with servicing then the chances of solar power catching on at the household level are even dimmer. That is what is happening as there are very few people who are prepared to install solar panels.
We installed a solar system in our office in Indore also. In an effort to maximise the use of the solar power during day time I improvised a system that would allow the running of the refrigerator on solar power during the day. However, since the fridge compressor uses power only intermittently there is an intermittent load. Sometimes when the printer is used, very rarely as mostly these days documents are sent by email, then the load shoots up beyond the capacity of the solar system and the inverter trips. Normally, this overload induced tripping can be set right by resetting the inverter but on two occasions the internal fuse of the inverter blew. So a complaint had to be registered with the inverter company. Luckily, the system in our office in Indore has a standard inverter connected to a solar prioritiser unit and so the repair could be done in Indore itself since standard inverters have a big market. However, for remoter locations, once again the problem of service crops up. So for the time being I have switched the refrigerator on to the mains during day time also to avoid more tripping and fuse blowing.
All this underlines the need for more pro-active support to the residential standalone solar power sector by the Government instead of its concentration on large solar parks set up on an industrial scale to supply into the grid. The subsidies provided to such industrial scale solar plants have brought down the cost of power from these plants hugely but the standalone solar power sector continues to dither along.

Friday, June 23, 2017

The Fight for Subsidies

Capitalism from its inception has survived on subsidies contrary to the much vaunted and popularised myth that it thrives on profits earned from competitive market economics. The biggest subsidy is of course the expenditure by the capitalist state in maintaining the army, police and prisons because it is inconceivable that the exploitation of the masses and the wealth accumulated from it can be safeguarded by the capitalists without the help of these three institutions. More generally the expenditures on the judiciary and bureaucracy also are subsidies that bolster capitalism. Overall these expenditures, along with those on physical and social infrastructure, by the state also serve to push up demand for goods and services and prevent the market from collapsing due to the rapacious and often unprincipled profit seeking by capitalists.

Since subsidies are so important for the profitability of economic activities there is always a fight going on between different sections of society for these subsidies as the resources of the government are limited at all times. Especially so in the case of the governments in the states in India which have limited fiduciary powers as compared to the Central Government. Generally it is the industrial class that garners most of the subsidies and the farmers the least. In fact farming in India, following the global trend has sought to be industrialised and subsidies have been given for this. Unfortunately, unlike in the industrialised countries, in India, a vast majority of the population still lives in rural areas and has farming as its mainstay. The subsidies for industrial farming with external inputs like chemical fertilisers, cheap or free electricity, cheap bank loans, hybrid seeds, pesticides, herbicides and free canal water are mostly hogged by industrial units producing these inputs and to a lesser extent by the bigger farmers with the small and marginal farmers getting very little.
Since the 1990s with neo-liberalism gaining in strength in this country, the subsidies and public investment in agriculture and the flow of cheap credit to it has gone down drastically and this has severely affected the profitability of the sector. Most farmers big and small have been hit by this. While the small and marginal farmers also double up as labourers in agriculture or in industry and construction to somehow make ends meet, the bigger farmers have found their incomes squeezed without many alternatives. Some have switched to high value vegetable cultivation, horticulture and floriculture but in the absence of adequate cold storages, post harvest processing and market linkages, most farmers are not earning as much as they want to and in many cases are making losses. A major problem is the decreasing availability of water both due to failed or inadequate monsoons and the rapidly diminishing ground water store.
This is the context of the farmer agitations that have swept across the country over the past few weeks and especially in Madhya Pradesh. Over the past decade or so, the Madhya Pradesh Government has provided cheap electricity to farmers by providing hefty subsidies and also ignoring the extensive power theft by the latter and this has led to a spurt in Rabi production. The higher production has led to lower prices for their produce in the absence of purchase by the government at remunerative prices. The big farmers have decided to hit back and launched agitations to demand that the government hike its subsidies to them further. Demands include, cheap credit, waiver of loans, procurement at remunerative prices and of course free electricity.
There are two main problems with this. The first, which is insoluble within the present paradigm of agriculture, is the unsustainability of water intensive agriculture which has sucked out most of the water in deep aquifers collected over thousands of years. The second is the precariousness of the Madhya Pradesh Government Finances. The public debt of the Government already stands at Rs 1.8 Lakh crores currently which is a very high 25 percent of GDP and requires around Rs 25,000 crores in debt servicing expenditure annually.  Now it has agreed to shell out even more in the form of subsidies to pacify the farmers to the tune of Rs 30,000 crores for procurement at remunerative prices, cheap credit, compensation for crop loss and even cheaper power. It has also to foot another enhanced subsidy bill in the form of paying salaries to its staff in accordance with the 7th Pay Commission recommendations which will amount to Rs 20,000 crores. Thus, the government's budget estimates are going to go for a toss since provisions have not been made for these increased expenditures requiring it to borrow even more. This has led to concerns being voiced by industrialists in the state that they will lose out greatly on their share of subsidies!!!
Thus, modern industrial development, and especially agriculture, is facing a double whammy in the form of environmental and financial unsustainability and the ongoing fight for subsidies between various sections of society is queering the pitch for capitalism in India considerably.

Monday, June 19, 2017

The Vanishing Skills

Six months of rigorous work later, the Women and Environment Centre of Mahila Jagat Lihaaz Samiti is finally up and ready for operations in Pandutalav village. It has been built with a combination of modern and traditional Bhil Adivasi technologies with the latter prevailing over the former as can be seen below.
The main obstacle to making the building totally traditional was the lack of timber. So a traditional timber house was bought from an Adivasi family but a large part of the timber columns had rotted below the ground. So eventually the walls had to be built of brick, stone and cement and that is how modern construction came in. However, the layout and design is still the same as the original house that was bought and the wooden beams and columns inside the building which take the central roof load have been exquisitely carved with traditional motifs as shown below.
The timber work including the carving has been done by traditional Adivasi carpenters and one of them, Dharasingh, is shown below putting final touches to the timber structure of the verandah.
The roofing is mostly of local tiles called nalia which have been made by local potters and also some Mangalore tiles. They require special skills for placement on the bamboo and timber support structure and once again there are specialists who do this work as shown below.
Finally, the flooring of the building is with a mud and cow dung mix which too requires special skills to apply and Budibai along with her team of women has accomplished this work.
Given the fact that Adivasis live at subsistence levels and use natural resources minimally, they have traditionally developed building technologies that are cheap and local resource based albeit labour intensive. They are also adapted to the climate. The nalia tiles used in the main building roof are arranged is such a way that they provide an air cushion and so in summers the houses remain cool and in winters they remain warm and so there is no need for costly ventilation and heating.
Unfortunately these traditional technologies and the skills required for their application are gradually vanishing as the much more expensive modern technologies are being promoted by the Government through its housing schemes that provide grants to the poor for building their homes. These schemes compulsorily mandate the use of bricks, cement and steel while at the same time not providing enough money for such construction. So Adivasis end up building small houses of cement and steel that are extremely hot and cold in summer and winter respectively and also do not have enough space for living and farming activities. Many of the Adivasis of the area who came to see the building expressed surprise that it had been built in the traditional style considering the fact that Majlis had enough financial resources to build a cement and steel box!! Little do they realise that the six months of hard work to build the centre have been an extremely rewarding experience for Subhadra and I. We realised how very skillful the Adivasis are and how hard working. We worked along with them whenever time permitted and could not help but deprecate the fact that our modern skills fetch us much much more money than the traditional skills do for our Adivasi workers and craftsmen who built the centre and were much more skillful and hard working than us. Incidentally, we paid the statutory minimum wages for unskilled and skilled labour, which are much more than what these people get when working for others in the area.

Tuesday, June 13, 2017

The Looming Disruption!!

Taxation of goods and services is one of the most vexing problems of late capitalism. These taxes lead to both an inflationary push and a distortion of the market mechanism. However, given the fact that laissez faire free market capitalism left to its own devices tends to collapse, there is a need for the capitalist state to step in both to regulate the destructive profit making logic of capitalism and also to boost demand through investments mainly in infrastructure and military spending and in providing public services and social safety nets. All this cannot be done without taxes and so they are there along with a huge bureaucracy involved in garnering these taxes.
Taxes are of two kinds – Direct and Indirect. Direct taxes are those that are levied on the income earned by individuals and corporations while indirect taxes are those that are levied on goods and services produced in the country and imported from abroad. Generally Direct taxes are said to be progressive because their incidence is greater on those with higher incomes. Indirect taxes are paid by all at the same rate when they purchase goods and services from the market, regardless of their income and so are deemed to be regressive as they put proportionately a greater burden on the poor. Also due to their inflationary and market distorting character indirect taxes are less welcome than direct taxes. However, since direct taxes alone cannot garner all the revenue required to run the capitalist state, especially in developing countries like India, where for a variety of reasons the direct tax base is comparatively small, indirect taxes have to be levied.
Over the years since independence, as the production of goods and services expanded, the indirect tax structure became very cumbersome not only with a plethora of different taxes for various goods and services but also an almost similar number of exemptions, surcharges and cesses. Matters have been complicated in India by its federal political structure wherein the states and centre tax the citizens separately and so the indirect tax structure became extremely complicated leading to huge problems in tax administration and large scale tax evasion and avoidance. Indeed the evasion of indirect taxes leads to concealment of income and so adversely affects direct tax collection also. Consequently over the past two decades there have been efforts to simplify the indirect tax structure to make it both more simple and more bouyant with the introduction and then refinement of the value added tax. The latest in this tax reform process is the impending implementation of the new Goods and Services Tax (GST) to be levied on goods and services produced within the country. It is being claimed by the Government that this will significantly ease the problems of tax administration and also smoothen and expand the economy as popularised by the slogan – one country, one tax and one market. Let us critically analyse whether this will indeed be the case.

The cardinal principle of indirect taxation is that it should have ideally just one rate or at the most two, regardless of the nature of the goods and services to be taxed. This is because the moment there are multiple rates, the scope for lobbying and litigation to decide which goods and services fall in which category increases and tax administration becomes complicated and costly. Any benefits that are to be provided to any sections of the citizenry for various reasons should not be through differential indirect taxes and exemptions but through subsidies to the parties concerned. Any restrictions that have to be imposed on the sale of particular goods and services which are harmful, like cigarettes and pan masala, can be done by imposing higher income taxes on the profits of firms producing them rather than by higher separate indirect taxes on their sale which will have the same effect of pushing up the prices of these goods to discourage people from buying them. In this way the lobbying is deflected away from tax imposition towards the provision of subsidies as it should be and indirect tax related litigation, which now clogs the courts of this country, is avoided altogether and there is very little distortion of the market due to taxation. The huge bureaucracy that is presently involved in indirect tax administration with its attendant costs, thus becomes redundant and can be gainfully redeployed to ensure higher direct tax compliance. Moreover, since tax evasion and avoidance become near impossible in a single indirect tax regime it becomes extremely difficult to conceal incomes and so the direct tax base and volume too increases substantially.
However, the problem in India's case is that it has a legacy of a huge number of rates, exemptions, cesses and surcharges and a federal political structure wherein the states and centre both have fiduciary powers to tax the citizens separately. The states, moreover, have much more limited fiduciary powers as compared to the centre and so are always constrained for resources and at present heavily in debt and sorely dependent on central grants. Since the central grants come in small tranches and late, the states are reluctant to give up whatever little fiduciary powers they have, especially the right to tax the sale of their three highest revenue yielding goods – land, petroleum products and liquor. Consequently, the GST as it stands today not only has four slabs of 5, 12, 18 and 28 per cent for various kinds of goods and services but also a special rate for Gold at 3 per cent and land, petroleum products and liquor have been kept out of its ambit altogether, allowing the states to continue to tax them at their will. Some goods like food produce of agriculture have been exempted from indirect taxes altogether. Moreover, there are various cesses and surcharges and so effectively there are more than ten rates. Also, given the States' reluctance to give up their tax collection powers, businesses operating at a national level will have to register and pay tax in each of the states in which they sell their products thus considerably increasing the compliance burden and attendant costs. Thus, the claim that the new GST regime will be a simple one tax one is an out and out falsehood.It is slightly simpler than what prevails currently but it is not simple in itself!!
The reason that is being advanced for having different rates for different goods and services is that these goods and services are used by different categories of people and so to reduce the burden of taxes on mass consumption items like food which are a major component of the expenditures of poor people these should be either exempt or have low rates. But this is a false logic and in effect leads to complications which result in higher costs for the people resulting from tax evasion and higher tax administration costs. As I said earlier, any benefits that need to be provided to the poor or other sections of society should be done through subsidies and not through market distorting differential indirect taxation.
Then there is the concern of the states of their revenue shrinking due to the loss of their independent fiduciary powers. This issue could have been addressed by making an assessment of the total revenue that is garnered by the centre and the states from taxing different goods and services as this data is there with them. Then through mathematical procedures a single tax rate could have been worked out for all goods and services that would yield the same total revenue as is being garnered currently and a formula worked out for sharing this revenue in the same proportion as it is being shared between the centre and all the states at present by iterating the formula over the tax revenue data over the past decade or so. There is anyway a provision for the compensation of states for any revenue loss under GST from the levels prevailing currently, primarily because of the fear of manufacturing states like Tamil Nadu, Maharashtra and Punjab that they will lose revenue since the GST is a consumption tax that will be levied at the point of sale. This compensation provision could take care of any anomalies in the revenue sharing results arising from the formula. Over time as the bouyancy of the taxes increases substantially due to almost hundred percent compliance under the new single tax regime, the sharing formula could be revised through consensus between the centre and the states.
Since there are now still a number of tax rates effectively amounting to more than ten in the new GST regime, there is also going to be in place a very complicated system of tax administration for this which is internet and computer based in a country which has very poor internet connectivity and low computer availability and literacy in most areas including in cities and towns. To make sure people do not evade taxes an input tax credit system is going to be implemented which will work as shown in the graphic below.

In the above graphic we ignore for the time being the tax that the manufacturer has paid on the goods and services procured by him and assume they are a part of his selling price of Rs 100. He adds Rs 5 for GST at 5 per cent and sells the product to the wholesaler for Rs 105 and uploads the invoice for the same to the Goods and Service Tax Network (GSTN), the internet based software that is to keep all the tax data, with which he is registered. Every month the manufacturer pays the total tax that he has collected from his sales in accordance with the invoices he has uploaded on to the GSTN to the tax authorities. The wholesaler on his part sells the product to the retailer at Rs 120 and adds Rs 6 for GST at 5 per cent. Since he has already paid Rs 5 of the tax to the manufacturer he can claim the tax credit from the invoice that has been uploaded onto GSTN by the manufacturer and will pay only the net GST to the tax authorities. The wholesaler too immediately uploads the invoice onto the GSTN. The retailer sells the product for Rs 160 and adds a tax of Rs 8 at 5 per cent when selling to the consumer, who, thus, pays the full tax. The retailer too pays only the net GST to the tax authorities after uploading the invoice of sale to the consumer onto the GSTN.
In theory the manufacturer, wholesaler and retailer will all demand that not only they get tax paid invoices from their vendors but that these are also uploaded onto the GSTN by those who sell to them because otherwise they will not be able to claim tax credits and will have to pay the whole GST themselves. However, this will be very difficult to implement on the ground for the following reasons.
1. Presently most of the business in this country is done without paying taxes and issuing tax paid invoices and so to expect that people will all of a sudden begin doing so from July 1st 2017 is a bit of an exaggeration. Primarily because once tax paid invoices are issued and uploaded onto the GSTN, these will enhance the turnover and profits of the company and make them liable to paying greater direct taxes.
2. Given the huge number of rates, exemptions and surcharges, the format for invoices and the process of their uploading to GSTN is complicated as are the formats for the returns that have to be filed every month and so these businesses will have to invest in computers and become computer savvy to be able to issue tax paid invoices and also upload them onto the GSTN and file their returns. There is also the need for good internet connectivity. The uploading to GSTN has to be done through service providers who have been appointed for the same by the tax authorities. However, at the moment the number of such service providers is woefully low. In the absence of good data connectivity and adequate numbers of well equipped service providers, the uploading of invoices and filing of returns will be a problem. 
3. Given these problems, businesses with annual turnover of Rs 20 lakhs in most states and Rs 10 lakhs in the northeast have been given the choice to not be registered with the GSTN. Businesses with annual turnover of Rs 20 to 75 lakhs will not have to pay taxes in accordance with their sales but upload only bills of supply and not tax paid invoices onto the GSTN  and pay 1 per cent tax on their declared turnover. However, these exemptions will complicate matters further. Larger businesses of annual turnover greater than Rs 75 lakhs which have to upload their invoices will have to pay the whole tax on the sale of their products including the tax on inputs not paid by suppliers who are not registered on the GSTN and they will have to also upload the said tax details on GSTN so that their customers can claim the input tax. This means on the one hand that the big businesses have an added burden of preparing invoices for their input purchases from small businesses and uploading them onto the GSTN and on the other hand paying the tax, known as reverse charge, not paid by their vendors who are exempted from doing so. Moreover, since a lot of these small businesses have been evading taxes both indirect and direct, they can merrily continue to do so as they do not have to upload their sale invoices onto the GSTN. All this could easily have been avoided if there had been just one rate of tax for all goods and services and so even small businesses could have been registered on GSTN and made to upload invoices and pay taxes as the procedure would be very simple and could be done from mobile phones through messaging based apps that do not require internet connectivity that can be designed for the purpose. They would just have to enter the amount of the transaction and the tax without giving details of the nature of goods and services sold as all are to be taxed at the same rate.
4. Finally, a lot of over and under invoicing goes on presently to evade taxes and often goods are transported in amounts which do not physically tally with the invoices. To check this malpractice, eway bills have been introduced in the new GST regime. An eway bill corresponding to the invoice generated has to be prepared and uploaded for transport of goods between any two businesses whether physically proximate or not. These eway bills can be checked at any time during the transportation of the goods to verify whether they correspond to the actual goods being transported. Once again the preparation and uploading of these eway bills is going to prove a great challenge and given the fact that these eway bills have specified timelines within which they are valid, there is bound to be chaos in the transportation of goods. If there is a single rate of tax and all businesses big and small have to pay this tax and be registered on the GSTN, then the scope for tax evasion is almost nil and there is no need for a complicated eway bill system.
5. Apart from this, exporters have expressed concern about getting timely refunds of the GST paid on their inputs without which their working capital requirements will increase making their products less competitive on the international markets.

Thus, given the multiple tax rates, exemptions and surcharges, the unpreparedness of the GSTN and service providers to handle the huge amount of invoices and returns that are going to be uploaded, the reluctance of people to record their transactions and so increase their recorded incomes and the liability to pay direct taxes, the exemptions given to small businesses to not be part of the GSTN and the chaos that will rule in the transportation sector due to the eway bills, The GST rollout on July 1st 2017 is bound to be vexing initially and will cause an even greater disruption than demonetisation did!!