Finance Minister Nirmala Sitharaman Presenting Ing Spent the First Year of His the Budget
15 FEBRUARY 2021 / `50 www.openthemagazine.com
contents 15 february 2021
5 6 8 10 12 14 16 LOCOMOTIF INDRAPRASTHA MUMBAI NOTEBOOK SOFT POWER OPINION WHISPERER OPEN ESSAY State of the gradualist By Virendra Kapoor By Anil Dharker Nivedita’s right to rebel The rage By Jayanta Ghosal The rites of liberation By S Prasannarajan By Makarand R Paranjape By Minhaz Merchant By Swapan Dasgupta
22 THE NEW DEAL 58 A SONG FOR THE UNSUNG 72 GO THE DISTANCE Resetting the mindset In doubling the allocation for MSMEs, the More regulatory reforms instead By Haseeb Drabu & Anil Padmanabhan Budget has recognised their potential in of stimulus packages please creating employment and boosting growth By Rameesh Kailasam 44 ‘ PEOPLE WANT THEIR By Dhirendra Tripathi GOVERNMENT TO 74 THE ABCD OF FAILURE ENSURE OPPORTUNITIES. 61 BECAUSE SMALL IS BIG From disease to defence, why THEY DON’T WANT TO Ways to oxygenate micro enterprises this Budget does not work CONSTANTLY LOOK By Rama Bijapurkar By Manpreet Singh Badal TO IT FOR DOLES’ Interview with Finance Minister 64 OUT OF THE PANDEMIC 76 OLÁ GOA Nirmala Sitharaman Putting healthcare centrestage is the first An allocation of Rs 300 crore to mark By PR Ramesh step in overhauling the system the 60th anniversary of the state’s By Nikita Doval liberation from the Portuguese is 50 THE NEW CONSENSUS evidence of its outsized influence A blueprint for sustained growth 66 SYNERGY AT LAST By Madhavankutty Pillai By Saugata Bhattacharya The holistic budget combines health systems, water, sanitation, nutrition 80 NO ROADS FOR OLD CARS 54 FARMER FRIENDLY and air pollution The voluntary scrapping policy drives Food subsidy and Minimum By K Srinath Reddy fear into the hearts of the country’s last Support Price data show the persistence Padmini and Ambassador owners of the government’s generosity 68 INVESTING IN TRUST By Lhendup G Bhutia By Siddharth Singh While the Budget seeks to ease last year’s pain, it wants companies and individuals to discipline themselves too By Dhirendra Tripathi
84 88 90 98 DANCING IN THE CITY SHUSH NO MORE ‘THE ROLES WE PLAY GIVE US A STARGAZER Bengaluru emerges as the new Art and infographics on social media BETTER UNDERSTANDING OF PEOPLE, By Kaveree Bamzai capital of Bharatanatyam platforms are breaking taboos REALITY AND OURSELVES’ By Akhila Krishnamurthy By Shikha Kumar Geetanjali Kulkarni on her journey from Marathi theatre to streaming platforms By Namrata Joshi Cover by Saurabh Singh 15 february 2021 www.openthemagazine.com 3 open mail [email protected]
Editor S Prasannarajan letter of the week managing Editor PR Ramesh C executive Editor Ullekh NP Even 75 years after his ‘death’, Netaji’s contribution editor-at-large Siddharth Singh deputy editors Madhavankutty Pillai as a freedom fighter remains hotly debated for two (Mumbai Bureau Chief), reasons (‘Back to Bose’ by MJ Akbar, February 8th, Rahul Pandita, Amita Shah, V Shoba (Bangalore), Nandini Nair 2021). One, successive Congress Governments have creative director Rohit Chawla worked to undermine his role and never gave him art director Jyoti K Singh Senior Editors Sudeep Paul, due importance. Two, successive governments in Lhendup Gyatso Bhutia (Mumbai), West Bengal have failed to push back hard enough Moinak Mitra, Nikita Doval Associate Editor Vijay K Soni (Web) against the Centre’s wilful amnesia, thus becoming assistant editor Vipul Vivek complicit in reducing the stature of Bose. BJP has chief of graphics Saurabh Singh resurrected him, maybe for political reasons and to SENIOR DESIGNERs Anup Banerjee, Veer Pal Singh tap the Bengali pride, but it is giving the Azad Hind Photo editor Raul Irani Fauj leader the place he deserves. When former UK deputy Photo editor Ashish Sharma Prime Minister Clement Attlee met then West Bengal National Head-Events and Initiatives Governor Justice PB Chakraborty in Kolkata in 1956, and call for an end to the Arpita Sachin Ahuja AVP (ADVERTISING) the former had admitted that one reason they let India farmer protests. Their silence Rashmi Lata Swarup become free was because the British feared Netaji. reveals their tacit complicity. GENERAL MANAGERs (ADVERTISING) Uma Srinivasan (South) Congress has tried to kill Netaji’s memory even as The protests have become conspiracy theories involving his death continue to a ruse for nefarious causes. National Head-Distribution and Sales Ajay Gupta pop up. While most historians look down upon ‘what We don’t know why Rakesh regional heads-circulation D Charles (South), Melvin George if’ historical debates given that figuring out actual Tikait actually cried just (West), Basab Ghosh (East) history itself is so difficult, it does help all of us to when he realised the police Head-production Maneesh Tyagi reimagine our present. had gone back to its usual senior manager (pre-press) Sharad Tailang Bholey Bhardwaj self, reacting with the force MANAGER-MARKETING that it should have much Priya Singh Chief Designer-marketing earlier to prevent the Red Champak Bhattacharjee Fort incident. cfo & HEAD-IT Anil Bisht red alert to take control of what they Ashok Goswami Chief ExecuTive & Publisher The months-long, ongoing have started. Neeraja Chawla peaceful agitation by farmers Chanchal Nandy balanced analysis All rights reserved throughout the world. Reproduction in any manner has suddenly taken a wrong Brahma Chellaney has is prohibited. turn (‘Rampage at Red Fort’, Red Fort has been a mute filled an important gap in Editor: S Prasannarajan. Printed and published by Neeraja Chawla on behalf February 8th, 2021). The witness to many historical Indian commentary on of the owner, Open Media Network Pvt Ltd. Printed at Thomson Press India Ltd, mayhem on Republic Day, events but what happened recent political events in the 18-35 Milestone, Delhi Mathura Road, Faridabad-121007, (Haryana). the day we resolved to bind on January 26th, 2021 shall US (‘A New Uncertainty’, Published at 4, DDA Commercial ourselves by the rules we gave stand out for different February 1st, 2021). He Complex, Panchsheel Park, New Delhi-110017. ourselves in the Constitution, reasons. The rampage brilliantly brought out in Ph: (011) 48500500; Fax: (011) 48500599 under the aegis of some seemed premeditated, a balanced tone the deep To subscribe, WhatsApp ‘openmag’ to 9999800012 or log on to activists, may have been given how smoothly the polarisation in the US under www.openthemagazine.com or call our Toll Free Number because the police went soft Sikh flag hoisting went. the Democratic presidency 1800 102 7510 on them, unlike what they Having disrupted the daily of Joe Biden as well as the or email at: [email protected] are claiming, or because of routine in Delhi, the rioters global strategic ramifications For alliances, email [email protected] the spontaneous excitement ran back to Punjab taking of the new administration, For advertising, email of some fringe elements. advantage of the soft police. reversing many of Donald [email protected] For any other queries/observations, But the damage inflicted The nation has been shamed Trump’s foreign policies. The email [email protected] to the cause of the farmers by their act. Unlike the much consequences for India are has undermined whatever maligned Republicans in particularly critical, given Disclaimer ‘Open Avenues’ are advertiser-driven marketing legitimacy it had prior to the US who gotto work to the traditional pro-Beijing initiatives and Open assumes no responsibility for content and the consequences of using the Red Fort incident. The find the miscreants among tilt of past Democratic products or services advertised in the magazine anarchy in Delhi on January themselves after the attack administrations which
Volume 13 Issue 6 26th was shocking. The farm on the Capitol Building in have tried to maintain For the week 9-15 February 2021 union leaders spearheading Washington, our opposition only a superficial image of Total No. of pages 100 the protests cannot wash leaders have shamelessly American strength. their hands of it. They need refused to condemn the act Sunil Tung
4 15 february 2021 LOCOMOTIF
by S PRASANNARAJAN State of the Gradualist
he context makes all the difference to the same kind of poetic flourish that set Candidate Modi apart on text—you may add the prefixes of sub- and meta- the stump in Prime Minister Modi too. He moved cautiously, not this time—of Nirmala Sitharaman’s Budget. While tentatively. It was the caution of a gradualist who disappointed she was presenting her proposals for growth and those who were looking for a version of Reagan or Thatcher with modernisation in Parliament, elsewhere in Delhi, a Hindu nationalist accent. In an unequal country like India, Ta protest with archaic demands was playing out, gathering which has not yet achieved the kind of economic stability needed support from those who were desperate for the theatre of to hold a full-fledged free marketeer, that was an irrational resistance—and, as argued in this space last week, suffering from expectation. Did it mean it was the onset of Hindu socialism Modi Derangement Syndrome. The Siege of Red Fort came after after the free run of the original that blunted India’s growth? the Government had surrendered by putting its agricultural True, the Right always won the economic argument and lost the modernisation agenda in deep freeze. The protest, which is now culture war. In power, Modi, like any other cautious pragmatist endorsed by celebrity hashtags and added to social media’s rage who resisted the temptations of ideology, chose the centre, and index, demands the death of one of this Government’s bolder at times, lived up to the truism that expediencies of governance modernisation programmes. In Sitharaman’s Budget speech, make all of them a bit socialist. By being unsentimental towards Modi kind of framed his reply, not to farmers alone, but to all the public sector and discarding the accumulated xenophobia in those who are still struggling to define his mind. foreign investment, Sitharaman’s Budget has shown remarkable The pandemic has provided the other context, a bigger one. market confidence. The gradualist has gained momentum. A world infected and bereaved largely reacted to the economic Is it that the state is retreating? Is it that necessary socialism cost of it by ‘stimulus politics’ and ‘cheque compassion’, and of the pragmatist is in pause? Such questions are out of place both invariably came after the initial failures in comprehending in a world where claimants to the benevolent state are in the the enormity of the crisis. Some leaders pooh-poohed the ascendant—call it the Bernie Sanders syndrome. The pandemic alarmism of others; some ridiculed the experts; some showed has spawned a new variety of progressivism in which, as provider respect to science; and some, rising above partisan politics, and protector, the state should be the most righteous arbiter. We had the right words of leadership. Modi, whose trust quotient may have been spared such extremism, but we too are fast realising is higher than most elected leaders in a democracy today, the increasing inevitability of a knowing state in our lives. The first played the sermoniser, and followed up the wise man’s problem is with the custodians of the state that knows better— words with the politics of compassion, all the while giving the remember that familiar figure of the pandemic leader rearmed? experts unrestrained mandate. He rejected the playbook of We have been spared such a leadership too. Still, the welfare state is populism, which mixes sentimentalism and ruthlessness with in vogue again, shedding its ideological pretensions. Thanks to the an autocrat’s efficiency. When Sitharaman’s Budget strayed virus, it’s not incompatible with the Right any longer. from the hoary tradition of sop salvation, it was in tune with the The story has many national variations. Seven years ago prime minister’s philosophy of gradualism in modernisation: Modi added a big dose of nationalism to the Indian idea of no instant therapy, and no desperation for buying happiness. freedom. It was his way of liberating the Indian story from all The health package in the Budget, even while responding to those borrowed isms that swayed the original nation-builders. the post-pandemic India with administrative empathy and His campaign invocation of a Congress-free India was more urgency, avoided policy mawkishness. India, than a call for defeating India’s natural party considering the state of its civic infrastructure of governance. It was a call for a nationalist and social disparity, is coming out of the reclamation of India, but without bringing pandemic still gasping for oxygen. The Budget gods to the arena. It was the argument of a reacted to the moment by addressing the Hindu nationalist as moderniser that won the fundamentals of healthcare. elections of 2014. He has not stopped arguing; It revealed the gradualist at work, again. he has not stopped campaigning. Nirmala And it’s a sight that continues to frustrate Sitharaman has just read out another winning those who have been expecting to see the argument of her boss. n
15 february 2021 www.openthemagazine.com 5 INDRAPRASTHA virendra kapoor
eturning to Delhi iniquitous system of retirement R after a pollution break of three benefits that they themselves had months in Goa, one finds the capital put in place, there is no trace of under siege. The coronavirus is still resentment. That is how life-long in the air. The AQI levels still hover relationships are forged, isn’t it? And in the hazardous zone. But, then, one last thing. In all these years, I it is hard to live long away from have never seen the restaurant staff your roots. Delhi is karambhoomi; so eager to please. Well past the shut- whatever the evil combination of down hour, they cooked a fine meal uncaring babus, cynical politicians especially for us, a sign of the near- and helpless farmers and others deserted bars and dining halls these might do to poison the air we days due to the pandemic. breathe, I shall stay loyal to Delhi, regulars who are beginning to put an While still on the coronavirus, my Dilli. There is some intangible occasional appearance in the Covid- the question being increasingly mystique about the city; it decays altered environs, with seating in tea asked is when and where one and degenerates and yet, unlike lounge and dining halls drastically was getting the vaccine. I have not some other metropolises, Delhi reduced, and the novelty of the thought about it though wife is alone seems to be able to renew and menu card being printed afresh for certain that as a fully-paid member regenerate itself, with its satellite each patron in the IIC, the fear of of the tiny and fast dwindling Parsi towns like Gurugram, Sonipat, contracting the infection still keeps community, she has some special Ghaziabad, even Meerut beginning most members away. However, the claim on the vaccines made by Adar to share its burdens and, as a result, bigger surprise was the Gymkhana Poonawalla’s Serum Institute of being compensated richly in higher Club. In all my years visiting the India. By the way, why Poonawalla? real estate value and a reflected glory elite club as a guest of a couple of If he followed how his ancestors of the national capital. (By the way, covenanted bureaucrat members kept their surnames, basing it on the Sonipat, for long known only for with whom I have grown up since profession they were engaged in, he the Atlas cycle factory, is turning out the days in Delhi University, this was would actually be a ‘Vaccinewalla’. to be the new Mecca of education the first time I found the club staff He makes the vaccines for half the with some of the most elite private genuinely welcoming all visitors, a world and has said that giving a universities, including the stellar token of appreciation for daring to couple of thousand—for that few are Ashoka, setting up base there.) Delhi risk contracting the infection and the numbers of Parsis in the country seems to have a huge capacity for braving the biting cold. or, for that matter, on Earth—on a embracing in itself all others on As it is, a large majority of regulars priority basis to his fellow jaatwallas, its fringes, a luxury unavailable to at the club are well past their sell-by- should be no problem. As for myself, Mumbai, Kolkata, Chennai, etcetera. date, having long been pensioned off well, I am in no hurry. Not exerting Though the elite watering and living off dearness allowance- myself for anything in life being a holes have opened their doors, linked monthly remittances characteristic, I am unlikely to the sahibs are still playing truant, from the hard-pressed taxpayers. make an effort to get the jab. If it to be seen rarely. The only people It is a travesty of the system that is offered in the normal course, who feel genuinely relieved are the pensions of retired secretaries, DGPs, I may go for it. Not otherwise. employees of these establishments, IGs, should exceed the monthly Though I must say some people in having spent months living in take-home of mid-level Class I my social circle are pulling strings trepidation of losing their jobs. A government officers. Of course, I to get the vaccine ahead of casual visit to the India International shouldn’t complain, having eaten out the priority groups. It seems even Centre (IIC) and the Habitat Centre regularly thanks to their generosity. the coronavirus cannot slay the revealed that normalcy is still some To be fair, even when needled VVIP genome usually found time away. Aside from the diehard regularly by yours truly about the in Indians, can it? n
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he suits have it! When the causes of railway deaths are various: TSensex climbs giddily upward, falling off trains, being hit by electric- you know who the Budget is for. ity poles while leaning out, falling in And when the polished guys who the gap between compartment and expertly look at the esoterica of platform, electrocution and even sui- economic numbers in television cide, although to me most of the other studios and tell us that the Budget causes mentioned seem to be a form is good for us, we know it’s good for of suicide. By the way, these numbers them. And best of all, finally little help from its friends. If only Ma- don’t include those killed while being Nirmala Sitharaman, Master’s at JNU harashtra had the sense to announce hit by trains while crossing railway notwithstanding, has shown that her an election like Bengal, Assam, Tamil tracks, possibly because no one wants heart is in the Right place. Nadu and Kerala, budgetary alloca- to pick the pieces up to count them. Who are we to quibble? The suits tions would have come flooding in! How do you stop this mayhem? have spoken, the captains of industry An obvious solution is to stop all have delivered their pronouncements umbai’s suburban train trains, but for reasons unknown, and the pink papers have shouted Mservices, what the locals call neither Western Railway nor Central in orgiastic glee, so they must all be ‘locals’, after a full ten-month gap, Railway are willing to consider this. right. For them the Budget contained were opened to all on February 1st, Another is to drum sense into passen- such delights as no new Covid tax, and as expected (and feared), men, ger heads, but apparently that’s been no wealth tax and no super-rich tax. women and children of all ages, tried without success. What if the budget announced a cut shapes and sizes came rushing back of Rs 6,000 crore from the already heaving masked sighs of relief. On the inadequate education allocation, with very first day, 3.4 million travelled, al Thackeray towers school education being hit with a which was astonishing when you ‘Bover Colaba,’ said the headline Rs 5,000 crore cut? After all, that only consider the restricted timings for the which is pretty restrictive for some- concerns children who don’t go to general public: they can travel only one generally referred to as the Shiv plush IB schools, or even ordinary before 7 am, and after 9 pm, with a 12 Sena supremo, and who at one time private schools. In any case when noon to 4 pm slot in between. towered over the whole of Maharash- they grow up, these children will Let’s figure that out. People will tra. Death diminishes us all. never become suits; their future is to have to come to work really, really The news item referred to the stat- add to India’s unemployed numbers early, well before offices open, and ue unveiled recently at the prominent and become just another statistic the leave really, really late, well after Regal Circle (formally called Shyama suits can ignore. As they ignored the their offices have shut. Or is Mumbai Prasad Mukherji Chowk). It’s made of Budget cuts to food subsidy and to spilling over with the milk of human bronze (the statue, not the junction), so MGNREGS, both of which are crucial kindness, and soft-hearted employers it shines with an orange glow. It stands to marginal rural farmers, migrants will let their staff leave really, really on a 14-foot pedestal and is 9 feet and the urban poor, all of who have early to catch the 4 pm local? tall, so ‘towering’ is the right word. It been disproportionately hit by the With the resumption of trains bears the inscription ‘Jamlelya majhya pandemic. something else that will resume is tamam Hindu bandhavano, bhaginino The state of Maharashtra feels death on the tracks. ‘It’s a matter of ani matano’ (‘All my Hindu brothers, aggrieved because its needs have been grave concern,’ said the Times of India, sisters and mothers gathered here’). completely ignored: even Mumbai’s choosing its words carefully. Activists If that sounds like the beginning of a real estate sector has got no relief from who, er, keep track of these things tell speech, it is: apparently that’s the way GST, or tax breaks for locked down us that between 2013 and 2020, there Bal Thackeray began all his speeches. construction projects, even though were 23,000 ‘railway deaths’ (for want Now standing there, arms aloft, he it’s one industry which employs of a better phrase). That’s over 3,000 will forever be about to speak to us, millions of unskilled men and every year. Last year, with the trains of course, provided we belong to the women and could have done with a locked down, only 730 perished. The mentioned categories of people. n
8 15 february 2021 Avenues DIET AND CANCER IN RECENT TIMES
ancer Incidence is increasing in inappropriate variations throughout the World. As C per Latest data this year 1 in 10 /15 people will have Cancer which has I AM AND I WILL crossed Cardiovascular Disease, which Colorectal Cancer is one of prominent used to be having highest Incidence in Obesity related Cancers. Similarly it has South Asian Countries. Around more been seen that consumption of red meat than ten lakh population are new cases leads to Colorectal cancer incidence rise, diagnosed due to Cancer in India. This Stomach cancer are also relatively higher in result in a massive hue and cry to look north east area because of typical intake of for Causes and factors which can be burnt meat or smoked meat consumtion is prevented to decrease cancer incidence. very high in NE region especially in Assam, Amongst the causes Tobacco Alcohol Tripura and Nagaland.Even hilly people Life style are dominant Causes for Cancer Dr Rudra Prasad Acharya smoke more to beat cold and leads to Incidence. But its worthwhile to correlate Cancers are more in South India because changes in esophageal mucosa and GI Cancer Incidence which is on rise as per of use of hot Spices. Similarly incidence esophaseal dysplasia to startwith later on recent Globocan Data, with Diet. Present of Esophageal Cancers are high in High turns to Cancer. Globocan Data has shown increased altitude due to use of hot drinks to avoid Overall it has been seen that Vegeterian cases of GI Cancers like, Stomach, cold in hills. Same in Colorectal Cancers, Diet is very protective to Gut and will result in Esophagus, Colorectal Cancers in India. Use of Red Meat and Junk food have lead less Incidence of GI Cancers. So we should Diet plays a major role in causation of GI to increase in incidence of Obesity and adapt our Ancestors to have Vegeterian Cancers. It has been seen that Upper GI Colorectal Cancers. Its Westernisation Diet to avoid Cancers. Although it can not of Life style and Dietary pattern which Immune from GI cancers but Incidences Key Points is responsible for Colorectal Cancers. are low in Vegeterian population. Kababs in toDAys It has been seen that Vegeterian diet is are very attractive diet in few areas of India HeAltHy Diet protective for Colorectal and Stomach ultimately, its Burnt Red Meat. Complete Cancers. Alcohol plays a major Role in GI avoidance should be practiced. Its 71. Avoid Junk Food cancers as it lead to changes in Gastric and high time we go back to our old habit of 2. Avoid Red Meat Colonic mucosal changes. So Alcohol and Vegetarian Diet (Satwik Bhojan)and Stay 3. Vegeterian Diet preferred Tobacco needs to be avoided. away from cancer. Physical Exercise and 4. Avoid spicy food Childhood obesity is a menace worldwide Fresh fruits also gives lots of oxidants to 5. Avoid very hot drinks and Its our moral duty to train our children beat Cancer.< 6. Alcohol and Tobacco – to avoid junk food which is quite common By Dr Rudra Prasad Acharya a big No. with Pizza, Burger, Mcrony which are pure Sr Consultant, Surgical Oncology 7. Whole cereals back again causes of Childhood obesity and in long Batra Cancer Centre, run will lead to obesity related cancers, Batra Hospital, New Delhi. soft power
By Makarand R Paranjape
Nivedita’s Right to Rebel Vivekananda and the Himalayan connection—Part IX
t had been a wonderful, most unworldly, summer weak. Turning on him in ‘surprised indignation’, Vivekananda of 1898 for Nivedita, despite its ups and downs. From had roared, ‘Why thrash the strong, of course! You forget your Swami Vivekananda she received lessons galore in own part in this karma. – Yours is always the right to rebel!’ (ibid). I spiritual life, some too deep for thought or expression. In a sense, it was Nivedita’s ‘right to rebel’, even though her As she recalled in The Master as I Saw Him, it was in Kashmir master wasn’t exactly oppressing her. Instead, as she saw when that she understood the immensity and grandeur of the truth they visited Hindu holy places, he became one with the hum- behind appearances: ‘The world, in all its aspects and relations, blest of the uneducated women devotees, making ‘the same is but a childish interruption of the flow of thought. Behind ev- offerings of milk and rice’, telling his beads and scrupulously erything is felt to be that unutterable fullness, of which the thing observing ‘the minutest rules of conduct, both secular and seen is so paltry and distorted an expression’ (bit.ly/3oJUO2B). religious’ (ibid). Her master, Vivekananda, was not like other ordinary mor- Of the two most sacred of sites in Kashmir, the group had tals. He was made of a different substance. For such as he was, already visited Kshir Bhavani. Now, what remained was the ‘Human relations are too poor to tempt those who have bathed trek to Amarnath, the ‘mountain-cave’ of the ‘ice-emblem of in the wellspring of all such relations at the Ultimate Source’ Siva’ (ibid).At Achhabal, in the Mogul Gardens, during a meal (ibid). While ‘love or compassion or heroism’ might be ways to outdoors, Vivekananda suddenly announced his intention to go reach or reflect the ‘Ultimate Source’, the only thing that really to Amarnath. defined it was the unwavering ‘perception of Oneness, and that His biography by ‘Eastern and Western Disciples’ records that alone’ (ibid). ‘as a special privilege Sister Nivedita was allowed to join him on Nivedita learnt the hard way that ‘steadiness and quiet and the pilgrimage, so that she, as a future worker, might have a direct self-effacement’ were probably more desirable virtues to culti- knowledge and insight into that time-honoured religious insti- vate than an active or aggressive expression, ‘prized in the West’ tution of his country’ (bit.ly/2YLmvxz). The rest of the European (ibid), of one’s temperament or disposition. She understood, party would go only as far as Pahalgam, waiting there for the instead, that at least as far as the spiritual life that she had so read- return of Vivekananda and Nivedita. ily and devotedly embarked upon, being ‘consistently indifferent In order to make their final preparations, the group retreated to our own personality’ (ibid), might be preferable. to their houseboats in Islamabad. With the aid of a state officer, The world itself, Swamiji said quoting Plato, was but a ‘feeble the whole group left the next afternoon, on July 26th, for Pawan. manifestation of the great ideas which alone are real and perfect’ It was ‘the first stopping-place on the way to the sacred shrine of (ibid). For Vivekananda, falling short of the ideal was no reason Amarnath’ (ibid). to give up or despair: ‘The attempt falls short still in many ways. Kashmir was full of pilgrims during that period. Everywhere, Still, – go on! You will interpret the ideal someday’ (ibid). In they witnessed ‘the march of gathering hosts’ (bit.ly/3cJ1ADp). contrast to the Western idea of progress, Vivekananda held that The pilgrims encamped in the open fields in neat and orderly ‘things do not grow better. They remain as they were, and we rows. By the next morning, they left, gathering all their belong- grow better, by the changes we make in them’ (ibid). Growing ings, leaving ‘no trace of their occupation, save the ashes of their better, progressing ourselves was practical Vedanta. The world cooking-fires’ (ibid). Quite in contrast to plastic-filled mess and would change on its own. garbage that modern tourists leave, almost as an identifying For Nivedita, that statement had the very ring of the Vedas. signature of their presence. Even karma, inexorable as it might be, could not deter the soul’s Nivedita marvelled at how the Amarnath yatris ‘carried a advancement and evolution. Nivedita remembered how, back in bazaar with them, and at each halting place, the pitching of tents, Almora, an elderly and amiably enfeebled gentleman had asked and opening of shops, took place with incredible rapidity’ (ibid). the Swami what was to be done when the strong oppressed the The camp had a ‘broad street’ running through its middle, where
10 15 february 2021 had died for the faith’ (ibid). They expected from Vivekananda a ‘nar- row orthodoxy’ (ibid) in this regard. Nivedita couldn’t help observing how ‘the Tehsildar himself, and many officers and servants of the pilgrimage’ were Muslims ‘and that no one had dreamt of objecting to their entering the Cave with the Hindu worshippers’ (ibid). As to her master, she considered him ‘an anachronism of the future’, someone so ahead of his own times and its prejudices.As it happened, the tehsil- dar, ‘came afterwards, indeed, with a group of friends, begging formal acceptance by the Swami as disciples’ (ibid). Approaching the sacred springs of Bawan, Nivedita recalls ‘the brilliance of the lights re- flected in the clear black waters of the tank that evening, and throngs of pilgrims proceeding in little groups from shrine to shrine’ (ibid). It was a classic scene from a timeless Indian past. The Saurabh Singh Saurabh by Illustration devotion to the divine, the longing for higher conscious still alive in common pilgrims and Nivedita learnt the hard way that advanced sanyasis alike. ‘steadiness and quiet and self-effacement’ When they reached Pahalgam, the entire were probably more desir able virtues to camp halted for day to observe the ekadashi vrat. cultivate than an active or aggressive Nivedita has left us a vivid description of it: ‘It was a beautiful little ravine floored, for expression, ‘prized in the West’, of the most part with sandy islands in the pebble- one’s temper ament or disposition. She worn bed of a mountain stream. The slopes understood, instead, that at least as far as about it were dark with pine-trees, and over the spiritual life that she had so readily the mountain at its head was seen, at sunset, the moon, not yet full. It was the scenery of and devotedly embarked upon, being Switzerland or Norway, at their gentlest and ‘consistently indifferent to our own loveliest. Here we saw the last of human dwell- personality’, might be prefer able ings, a bridge, a farm house, with its ploughed fields, and a few saeter-huts [huts built on high pastures in Scandinavia] And here, on a grassy knoll, when the final march began, we left the ‘one could buy dried fruits, milk, dahls, and rice’ (ibid). Nivedita’s rest of our party encamped’ (ibid). and Vivekananda’s tents were separated by the tehsildar’s in the Travelling via Islamabad, Pahalgam, Chandanwari, Seshnaag middle. That is where they lit the evening fire and gathered and Panchtarani, the duo finally reached Amarnath on August at dusk. 2nd, 1898. The hundreds of monks in gerua (ochre), with their umbrella- For the pilgrimage, Nivedita had taken on the role of Vive- size saffron tents, seemed to gravitate around the magnetic kananda’s ‘spiritual daughter’ though there was hardly an age personality of Vivekananda: ‘The more learned of them difference of five years between them. ‘In my own case,’ she swarmed about him at every halting place, filling his tent, and observed, ‘the position ultimately taken proved that most happy remaining absorbed in conversation, throughout the hours of one of a spiritual daughter, and as such I was regarded by all day light’ (ibid). the Indian people and communities, whom I met during my The monks failed to understand the warmth of Vivekanan- Master's life’ (ibid). da’s ‘love and sympathy for Mohammedanism’ while they But would that repositioning of their roles and the reinven- refused to make distinctions between ‘Swadesh and bidesh’ (ibid). tion of her own personality cure her of her attachment to her For Vivekananda, Hindu and Muslim were ‘rival elements’ in the master and its attendant expectations? These had reached their same unity that was India. But the monks remembered how ‘the peak by the time they arrived at Amarnath. soil of the Punjab… was drenched with the blood of those who (To be continued) n
15 february 2021 www.openthemagazine.com 11 opinion
The Rage Modi may be right. The opposition privately thinks so too. Hence the anger By Minhaz Merchant
he anger runs deep. It isn’t directed ecosystem and the new ecosystem that Modi has created but against injustice. It isn’t aimed at a set of ideas. It lacks full control over? Or something even more sinister? T is directed against one individual: Prime Minister Whatever the truth, this state of affairs can’t go on. Narendra Modi. Modi believes that macro-economic policies matter less For nearly seven years, Modi has upended the Nehruvian electorally than micro-economic schemes. He is the consensus. Those who benefited from the old corrupt archetypal executor. Give him a project—new or old—and political continuum—financial, ideological and dynastic— he will pursue it to completion with frequent reviews and are angry that a chaiwala has ended that lazy, lucrative micro-management. continuum. Meanwhile, BJP’s stormtroopers are allowed to whip up Of course, they dare not call the prime minister a chaiwala majoritarian sentiment. Modi’s attention is fixated on three anymore. They know how he used the epithet hurled at him elections: West Bengal in 2021, Uttar Pradesh in 2022 and the on the eve of the 2014 General Election to his advantage. Lok Sabha in 2024. Modi believes a combination of welfare They obsess over him in private conversation. The anger benefits for the poor, largescale infrastructure projects and rises in tandem with Modi’s electoral popularity. Modi has muscular Hinduism will deliver to him a third term. not been the perfect prime minister. Far from He may be right. The opposition privately it. Early in his premiership, I wrote this: ‘The Those who benefited thinks so too. Hence the anger. The vitriol most successful leaders surround themselves from the old corrupt comes from the top: Rahul Gandhi, Akhilesh with people smarter than themselves. Modi, political continuum— Yadav and Mamata Banerjee who stand to lose in contrast, is surrounded by people who are the most from Modi’s continued popularity. financial, ideological not smarter than him. That is, perhaps, the The Indian media is torn: on one side is biggest failing of his prime ministership.’ and dynastic—are the supplicatory media that flatters Modi; I have long criticised Modi’s macro- angry that a chaiwala on the other is the viscerally hostile media economic policies, the lack of talent in his has ended that lazy, that rages at him. Cabinet and the poor communications lucrative continuum Foreign journalists have never come protocol of the Prime Minister’s Office to terms with a prime minister who gives (PMO). Modi has failed to get the law ministry them little importance and pays them no to speed up prosecution of allegedly corrupt opposition attention. They react with venom. leaders. Cases are allowed to meander because Government- However, by not focusing adequately on the real issues appointed public prosecutors either don’t turn up in court or where Modi has actually failed—Cabinet talent, macro- advance weak arguments at hearings. economics, poor communications—they reveal both A striking example is the 2G case which was mishandled incompetence and bias. They remain fixated on Modi’s by the public prosecutor Anand Grover. The Modi majoritarianism. A critical eye obviously needs to be cast on Government changed the prosecutor only after the court that but not at the expense of other key failures. had acquitted the accused, including former Telecom An article by an Indian journalist in The Washington Minister A Raja and Dravida Munnetra Kazhagam leader Post reveals the venom that seeps through commentary K Kanimozhi, party founder M Karunanidhi’s daughter. on Modi: ‘Our country continues its march to complete The cases against former Finance Minister submission before a demagogue who is not afraid to P Chidambaram and his son Karthi Chidambaram establish dominance through the power of the mob.’ involving AircelMaxis and allegedly benami foreign Journalists burdened with ill will against Modi often properties are in limbo. begin an article on, for example, urban housing but at More pointedly, the Rs 2,000-crore National Herald the end, almost mesmerised by their rage, bring Modi property case against the Gandhis—in which two of the into the argument, however removed he is from the accused, Rahul Gandhi and Sonia Gandhi, are out on bail— central discourse. It would be comical were it not such a remains in hibernation at the trial stage. severe indictment of their professionalism What does all this add up to? Wilful delays by an old and integrity. n ecosystem that still has the power to block Modi’s anti- corruption agenda? Complicity between that old, corrupt Minhaz Merchant is an author, editor and publisher
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BJP’s Bengal Favourite
In the coming West Bengal Assembly election, former Trinamool Congress leader and minister Suvendu Adhikari is getting prime importance in the Bharatiya Janata Party (BJP), which he has just joined. Last month, when Prime Minister Narendra Modi was in Kolkata, at a tea party, he came to the table where Adhikari was sitting and they talked separately for about 10 minutes. Adhikari was a member of Parliament earlier and had interacted with Modi a few times as a Trinamool leader. Home Minister Amit Shah is also very favourably disposed towards him and invited him to Delhi to attend BJP’s core group meeting. Mamata Banerjee pulled a surprise when she announced her decision to contest from Nandigram, the stronghold of Adhikari. The question now is whether he will take on the challenge. BJP is keen that he should not be solely engaged in one constituency and must campaign in all areas given his political stature.
Exploiting the Sting Old Bonds efore the West Bengal election, the Central Bureau Congress leaders across India still remember Bof Investigation (CBI) is reportedly trying to file a Ahmed Patel, party President Sonia Gandhi’s key chargesheet in the Narada sting operation, in which lieutenant, who passed away in November 2020. many Trinamool Congress leaders were caught tak- Recently, his daughter Mumtaz Patel visited ing money on camera. CBI recently sought permission Jaipur for a personal reason. She was staying at from the West Bengal governor to include the names a Congress minister’s home. The minister of three more ministers in the case before finalising the informed Chief Minister Ashok Gehlot who chargesheet. If the governor gives that permission with- immediately called and invited Mumtaz to his res- out the sanction of the state government, it will lead to idence, where she met him and his family. Since a fresh war between the two. Possibly, it will be Delhi returning to Delhi, she has been telling everyone that will take a political call on this. about Gehlot’s hospitality.
14 15 february 2021
Illustrations by Saurabh Singh
In Solidarity Managing 021 is important to Bangladesh as it will mark 50 Anna 2years of the 1971 liberation war with Pakistan and evendra Fadnavis the freedom struggle that Sheikh Mujibur Rahman, might be down the country’s first prime minister, led. Recently, D politically at the mo- Bangladesh’s foreign secretary came to India and met his Indian counterpart. It has been decided that ment, but he is find- Prime Minister Narendra Modi will visit Dhaka on ing ways to be useful March 26th and the next day, there will be a bilateral for his party. BJP has meeting between the two countries. steadily lost ground in Maharashtra, the recent example being the poor showing in the panchayat polls. But Fadnavis proved his skills Turf Encroachment at backroom manipulation in persuading Anna Hazare to s Jyotiraditya Scindia still waiting for a Cabinet call off his proposed fast in Iberth or busy with Madhya Pradesh politics? He has become very active in the Gwalior and Chambal areas support of the farmers’ of the state, doing padayatras and political meetings. protests. Amit Shah had told He also went to Morena, the Lok Sabha constituency Fadnavis to talk to Hazare of Union Agriculture Minister Narendra Singh Tomar. personally and Fadnavis Twenty-five people had died there recently after managed to dissuade Hazare. drinking poisonous liquor. Scindia met the affected families and gave Rs 50,000 to each of them. He also assured strong action by the state government against the accused. But it is being said Tomar was not happy about this ‘encroachment’ on his territory. The CD Rumour ver the past few months, there have been Owhispers in Karnataka’s political circles about a CD. Nobody knows its content but every BJP Name of leader thinks it is detrimental to Chief Minister BS Yediyurappa. After he expanded his cabinet last the Game month, these rumours have peaked. The first time n Maharashtra politics, talk about the CD started was in November 2020 IAurangzeb has become after Yediyurappa’s grandnephew and political a flashpoint for the secretary, NR Santosh, was hospitalised, it is ruling alliance. The Shiv believed, after an attempt at suicide. Now it is Sena wants to rename being gossiped that Yediyurappa accommodated Aurangabad, which is leaders in his cabinet who were threatening him named after the Mughal with the CD. emperor. They want it called Sambhajinagar, after the son of the Maratha emperor Shivaji. The Congress is not in favour of it. Sena’s Shawl Musings mouthpiece Saamana n South Block, officialsin the Prime Minister’s criticised the Congress IOffice and Ministry of External Affairs are busy in strong language for speculating on a Kashmiri shawl. Recently, Saudi Muslim appeasement. Crown Prince Mohammed bin Salman chaired a Sharad Pawar, who leads meeting wearing a shahtoosh shawl and the image the Nationalist Congress Party, the third partner in went viral as a fashion statement. Since the shawl is the coalition, has not banned in India and its possession is punishable, no revealed his stand on the one still knows where Salman got it. Indian issue so far. bureaucrats are scratching their heads over this.
8 february 2021 www.openthemagazine.com 15 open essay
By Swapan Dasgupta
The Rites of Liberation The Modi government held its nerve and enhanced India’s faith in itself
or those old enough to remember the 1970s and 1980s, the Union Budget was Openomics 2021 Finvariably covered in a ritual of speculation, excitement and turmoil. As the final day of February approached—it was Narendra Modi’s Government that brought the Budget calendar forward—a wave of rumours, some based on nothing in particular, gripped the country. Some items that were favourite targets of the taxman either disappeared from the shop counter—cigarette hoarding was a compulsive sport—or were greeted with short-term panic buying—filling up petrol could sometimes save a couple of hundred rupees. Rumours guided the movement of stocks. Business leaders awaited the Budget with tension and did instant back-of-the-envelope calculations of possible impact of excise duty modifications. Chambers of Commerce organised gatherings of industrialists on the Budget day to collectively digest the bad news and, on a few occasions, the unexpected, good news. There was even a glamour quotient attached to securing a visi- tor’s pass for the Lok Sabha galleries and the finance minister’s family was the target of media coverage. Even the politicians reacted to the Budgets in a predictable manner. A dose of heavy taxation was accompanied by the argu- ment that the government was promoting equity or redistribution of income, the underlying message being that the well-off and the rich deserved to be squeezed. The opposition in turn was quick to describe any Budget as anti-people, anti-growth and inflationary. As an opposition leader with little interest in economics, Atal Bihari Vajpayee had a stock answer to queries on the Budget: “Garib ke pet pe laath maar diya.” The most informed alternative view came from outside Parliament, from the distinguished constitutional lawyer Nani Palkhivala. His annual lectures on the Budget had audiences pack the Brabourne Stadium in Mumbai and the Netaji Indoor Sta- dium in Kolkata for an economic vision that upheld efficiency, probity and private enterprise. As for the economists, with notable exceptions, the preoccupation was with plan and non-plan expenditure and bolstering the inefficient public sector. The predictability, alas, didn’t extend to the government’s management of its finances. The over-regulated Indian economy kept business, trade and taxpayers on tenterhooks as successive governments toyed with schemes to spend more and more in an environment of low growth and with little concern for the quality of expenditure. Budgets were a moment of dread for India, unless of course you were lucky enough to be in the inner circle of decision-making. Fortunately, the bad old days have long passed. There were two important milestones in the passage to liberation. First, the process of deregulation of the economy that was initiated by the PV Narasimha Rao Government as a response
16 15 february 2021 Prime Minister Narendra Modi Speaks about the Union Budget in New Delhi, February 1
pib
Throughout the lockdown period and after, there was a clamour among economists for the Government to abandon its policy of fiscal restraint and pour cash into the hands of people—an approach that they felt would kickstart a spluttering economy. The Modi Government, however, had other ideas
15 february 2021 www.openthemagazine.com 17 open essay
to a huge balance of payments crisis that prompted India to Singh’s Budget in 1985 of lowering the rates of personal taxes mortgage some of its gold reserves, led to the Government to levels that discouraged innovative accountancy to evade attaching priority to the private corporate sector and foreign having to pay the exchequer. capital. Wealth creation became a priority. In effect, this Since he assumed charge in May 2014, Prime Minister meant that the non-state sector and individual taxpayers Narendra Modi added his own touch to public finance. could no longer be regarded as milch cows. The sharp reduc- First, while persisting with the overall philosophy of low tion of personal and corporate tax rates from the punitive taxes, he put greater emphasis on enhanced compliance. levels they had reached during the high noon of Indira Using technology to full effect, the finance ministry created the Gandhi’s socialism also meant that there were incentives for architecture that would make it difficult, if not impossible, for tax compliance. By implication this meant that Budget pro- both individuals and businesses to make banking transactions visions couldn’t be couched in dollops of unpredictability. A difficult without a Personal Account Number (PAN). Conse- stable business environment meant that revenue generation quently, and particularly after demonetisation, the numbers of had to follow a predictable path and also be linked to the individuals filing personal income tax returns and businesses future of wealth creation. It is a matter of satisfaction that filing their GST returns registered a sharp increase. The widen- the broad parameters of this approach chalked out in 1991 ing of the tax base negated the need to raise tax rates to cover up have been broadly adhered to, a notable exception being the revenue shortfalls. regressive retrospective tax imposed by Pranab Mukherjee Second, the increase in India’s GDP after the opening up of under the Manmohan Singh Government. the economy witnessed a simultaneous increase in both the states’ and Centre’s expenditure on welfare spending. Flushed with funds that were unimaginable during the heyday of he second milestone was the enactment of the socialism, successive governments focussed on extending a TGoods and Services Tax (GST) after prolonged negotia- helping hand to the poor and vulnerable. The Vajpayee Govern- tions between the Centre and the states in 2016. The constitu- ment concentrated on upgrading India’s creaking infrastruc- tional impact of GST was profound. Since this was a national ture, believing, quite rightly, that this would have a trickle- tax aimed at removing a multitude of local taxes imposed by down effect. The Manmohan Singh Government, influenced the states, it meant that both the Centre and the states had by Sonia Gandhi’s mother bountiful approach, sought to create to abandon absolute sovereignty and pool their sovereign handouts but without much concern for delivery. powers in a GST Council. In practical terms this meant that Modi didn’t discard either approach. He accelerated the pace the power to impose new taxes or modify existing rates no of infrastructure building, adding railways to the sectors that longer vested in the Budget, making it more predictable. An needed urgent attention. Additionally, he stepped up welfare unintended, although natural, consequence of the GST was to expenditure, including direct welfare and subsidy payments to undermine the importance targeted beneficiaries. Hav- of the revenue section of Finance Minister Nirmala Sitharaman presenting ing spent the first year of his the Budget. Since changes the Unon Budget in Parliament, February 1 administration extending in indirect taxes, except in the reach of banking servic- petroleum products and es to the very poor through alcoholic beverages, could Jan Dhan accounts, he now only be sanctioned by the used these accounts to cut GST Council, involving all out intermediaries and, in the states and the Centre, the process, reduce corrup- the element of surprise and tion exponentially. The tax unpredictability was taken department made the hith- out of the Budget. This erto arduous task of filing complemented the trend tax returns so ridiculously set by Vishwanath Pratap simple and prone to instant
Like Manmohan Singh in 1991, Finance Minister Nirmala Sitharaman used an acknowledged crisis to push through changes that in more normal times would have invited fierce criticism from the remnants of India’s socialist bloc—a bloc that exists in all parties. Small wonder that the criticism of the Budget was limited to tired slogans about selling the family silver
18 15 february 2021
open essay
verification that the tension attached to the annual Budget ing and sustainable. The political test of this approach was the was reduced. Bihar Assembly election that was narrowly won, defeating a Finally, right from the outset, the Modi Government made sustained populist challenge based on a reckless expansion of it clear that it disavowed sops and special incentives, except in the government sector. exceptional circumstances. The Government focused instead Sitharaman’s Budget has, in effect, enlarged the approach on the ease of doing business, believing that less cumbersome spelt out last year to a larger sphere. The massive increase in ex- regulations, the absence of cronyism and the creation of an appro- penditure on health was quite easily digested by public opinion, priate environment would promote an entrepreneurial culture. not least on account of the encouraging progress of the vaccine This in turn would have a cascading effect and end up promoting programme. The programme to upgrade India’s infrastructure, growth. Although this approach suffered a setback due to the particularly in roads and railways, always had a ready audience Covid-19 pandemic and the ensuing disruption of normal life all since such investments have a big and visible multiplier effect. over the country, the basic approach was not abandoned. Finally, the sops to farmers in the form of enhanced procurement It was the special circumstances of post-pandemic recovery prices and relief to plantation workers was a response to the agita- that created a measure of extra interest in this year’s tion in northern India which will help offset an impression that Union Budget, presented by Finance Minister Nirmala the Government wants to turn a way of life upside down. Sitharaman. Throughout the lockdown period and after, However, public perceptions of the Budget are also dispro- there was a clamour among economists for the Government portionately shaped by the middle classes. Sitharaman won to abandon its policy of fiscal restraint and pour cash into the the hearts of this section by avoiding any extra tax burden and, hands of people—an approach that they felt would kickstart a indeed, making tax compliance that much easier for corporates. spluttering economy. They wanted Sitharaman to emulate the Particularly appealing to businesses were the provisions to British Chancellor of the Exchequer Rishi Sunak and, in effect, decriminalise technical violations of the law. Like Manmohan pay partial salaries to prevent job losses. Singh in 1991, Sitharaman used an acknowledged crisis to push The Modi Government, however, had other ideas. The through changes that in more normal times would have invited
Right from the outset, the Modi Government made it clear that it disavowed sops and special incentives, except in exceptional circumstances. The Government focused instead on the ease of doing business, believing that less cumbersome regulations, the absence of cronyism and the creation of an appropriate environment would promote an entrepreneurial culture
Rs 20,000 crore stimulus package announced by Sitharaman— fierce criticism from the remnants of India’s socialist bloc—a bloc in effect an Interim Budget—focused on three things. that exists in all parties. Small wonder that the criticism of the First, in line with its principle of very targeted relief Budget was limited to tired slogans about selling the family silver. to the most vulnerable sections, it offered cash handouts For Finance Minister Sitharaman this Budget was a coming- through direct benefit transfers to women, migrant labour of-age party. Ever since she assumed charge, she had oper- and farmers and undertook a massive campaign to ensure ated under the shadow of her redoubtable predecessor who food security for all. For the vocal middle classes who expe- combined his nominal job in North Block with responsibilities rienced the disruption severely, it offered some non-cash as the Government’s foremost crisis manager. Sitharaman isn’t relief such as extension of tax deadlines and reduction in likely to be another Arun Jaitley but in presenting a Budget that the Tax Deducted at Source rates. is based on the premise of optimism, she has boosted national Second, it used the pandemic to enhance capacity-building sentiment enormously. The challenge of reversing degrowth in the crucial health sector, building the necessary infrastruc- with a double-digit expansion of the economy is undeniably ture that has been so useful in rolling out the gigantic anti- daunting, even though the International Monetary Fund Covid vaccine programme across the country with a measure suggests India is on target. However, the mere fact that the of spectacular efficiency. Finally, it used the pandemic and Government’s budgetary calculations are based on a spectacu- the lockdown to foster the notion of self-reliance (not to be lar recovery has enhanced India’s faith in itself and, by implica- mistaken for self-sufficiency) in Atmanirbhar Bharat, a variant tion, its faith in a finance minister who can think big. n of the Make in India programme announced in 2014. In effect, what the Modi Government successfully did Swapan Dasgupta is an MP and India’s foremost conservative was hold its nerve and not be bamboozled into short-term columnist. He is the author of Awakening Bharat Mata: remedies that would make the long-term recovery less endur- The Political Beliefs of the Indian Right
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* Gift may be sent to you and magazines to the person you want to gift the subscription. Openomics 2021 UNion Budget
The New Deal Resetting the Mindset
Photo getty images B y Haseeb Drabu and Anil Padmanabhan Finance Minister Nirmala Sitharaman and Minister of State Anurag Thakur on their way to Parliament to present the Union Budget, February 1
The New Deal Resetting the Mindset
B y Haseeb Drabu and Anil Padmanabhan Openomics 2021 UNion Budget
ast year, when Nirmala Sitharaman replaced the Budget in a briefcase—a colonial hangover imitating the ‘Gladstone Box’— with a local bahi khata, she started a tradition. In doing so, the minister’s family, especially her mother, made sure that the bright red cloth pouch with the golden Ashoka emblem was blessed by Lord Ganesh at the Shree Siddhivinayak Ganapati Temple in Mumbai. It was a scramble but the finance minister’s mother managed the auspicious rendezvous. LThis year, by carrying the tablet in the ‘sanctified’ cloth pouch she blended tradition with modernity, thereby sending a message. But that is not the only message in the Budget which has been feted for laying out a plan for safely navigating the country’s economy through the global destruction caused by the Covid-19 pandemic. The Union Budget for 2021-2022 combines the political sensibilities of New Delhi with the economic spirit of Mumbai to achieve a paradigm shift in economic policy—a scale last witnessed in 1991 when the nature of the economic policy regime was changed for good. To align these divergent, often conflicting thinking and expectations, is a bold move to say the very least. To marry an entrepreneurial inclination with a rentier mindset can be the recipe for a Molotov cocktail—especially with political opportunists waiting to strike. Yet, the finance minister seems to have managed the tensions between these two opposing forces with the skill of an accomplished trapeze artist sans the usual safety nets.
24 15 february 2021 Budget will not be remembered for the impressive Rs 35 lakh crore expenditure that it promises. It will also not be remem- THE 1991 MOMENT bered for the Rs 5.5 lakh crore capital expenditure, almost 3 per cent of the Gross Domestic Product (GDP) or the coun- try’s national income, the highest in recent memory. It will not urely for its decisive break from the past, the be remembered even for the massive hike in the expenditure Union Budget for 2021-2022 will rank among the top on health; the outlay for ‘health and wellbeing’ was pegged at five ‘disruptive’ Budgets and pitchforks Sitharaman, Rs 2.23 lakh crore in 2021-2022—an increase of 137 per cent most unexpectedly, into an elite league of finance over Rs 94,452 crore this year. Pministers. Combining with her boss, Prime Minister Narendra Instead, it will be part of Budget history for the change in Modi, Sitharaman has carved out a special space for Modinom- mindset it boldly articulates; for trying to make ‘Future Proof’ ics in the budgetary history of post-independence India. India; for aligning it with the aspirations being articulated by The last time a duo combined with such finesse was Prime the youth, who account for two-thirds of the population. The Minister PV Narasimha Rao and Finance Minister Manmohan unambiguous embrace of economic reforms—already visible Singh in 1991. Exactly why some analysts are referring to this in the resolve of the Bharatiya Janata Party (BJP)-led National as the ‘1991 moment’; because, once again, a Budget has ignored Democratic Alliance (NDA) to ignore the pushback and stay political rebuke and undertaken a bold and radical paradigm the course on the new farm laws—is remarkable. Overnight, shift. To be sure, Team Sitharaman’s big-stakes gamble was the iterative approach of ‘reforms by stealth’—a hallmark of based on the prime minister holding all the political aces. For the process of economic change pursued for the last 40 years— now, it has paid off with the markets voting, scaling a record has been ejected from the policy lexicon. high. Sitharaman’s third Budget (the economy did get third- Also, this Budget is the first policy document of the Union time lucky!) will be remembered for long. Government which virtually writes the obituary of the Neh- It already has a moniker: A-once-in-100-years Budget. This ruvian legacy of a mixed economy and commanding heights
Purely for its decisive break from the past, the Budget 2021 will rank among the top five ‘disruptive’ Budgets and pitchforks Nirmala Sitharaman into an elite league of finance ministers. Combining with Prime Minister Narendra Modi, Sitharaman has carved out a special space for Modinomics in the budgetary history of post-independence India. The last time a duo combined with such finesse was Prime Minister PV Narasimha Rao and Finance Minister Manmohan Singh in 1991
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This Budget is the first policy document of the Union Government which writes the obituary of the Nehruvian legacy of a mixed economy and commanding heights of the public sector so decisively. this effort should not be seen in isolation. in terms of scale and intent it is unparalleled. But it is part of a larger transition being undertaken by India— partly by the sheer structural disruption caused by technology and partly owing to deliberate nudges towards a rules-based regime
of the public sector so decisively. The Nehruvian development months when new norms of lockdown and social distancing model of the state’s all-pervasive primacy over individual en- shifted most transactions to the online space. Already fintechs terprise has been finally turned on its head. As audaciously are stepping into this space to expand the idea of inclusion to as Modi did in politics, Sitharaman has done it in economics. include access to working capital credit for MSMEs. Importantly, this effort should not be seen in isolation. Yes, This Budget is therefore an exercise in continuity of change. in terms of scale and intent it is unparalleled. But it is part of a larger transition being undertaken by India—partly by the sheer structural disruption caused by technology and partly owing to deliberate nudges towards a rules-based regime. This Bold Reforms transition, which began a decade ago with the introduction of Aadhaar, has seen a phenomenal acceleration in the last six years—an excellent example being JAM (Jan Dhan, Aadhaar rior to the Christmas break, Sitharaman shared and Mobile) which has helped productionise direct benefits a teaser on her upcoming Union Budget. Address- transfer; not only has it helped in targeting the beneficiary, ing a summit hosted by the Confederation of Indian but it has also reduced leakages, cumulatively estimated at Industry, she said, “Send me your inputs so that we Rs 1,70,000 crore at the end of March 2020. The rejection of a Pcan see a Budget which is a Budget like never before in a way. discretion-based regime—like it happened with the decision Hundred years of India wouldn’t have seen a Budget being to allocate spectrum and coal mines through auctions—is a made post-pandemic like this.” non-negotiable for any economy looking to provide an equi- Most interpreted this to mean that the Union Budget to table opportunity, both for its citizens and foreign investors. be presented on February 1st would be a game-changer. Only The unshackling of the economic regime proposed in the natural for it to then have stirred expectations. Yet, there was Budget blends with the emerging ecosystem in which the digi- one other important subtext to the finance minister’s remarks: tal economy is the base. The contours of the digital economy the return of the big-bang Budget. have witnessed an unprecedented expansion in the last nine For several reasons, over the last few years, the Union Budget
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has gradually lost its sheen; it was reduced to just one more date mitments presented in the 2020-2021 Budget—presented just on the annual economic timeline of the country. prior to the pandemic. It did announce three stimulus packages For one, the rapid growth of the private sector meant the role staggered over six months. The bulk of the spending, especially of the Union Government as the dominant economic entity in the initial months, was directed towards saving lives—by gradually decreased. Then the rollout of the Goods and Services providing income and food in the hands of the people. It was Tax (GST) happened. The power to undertake substantive in- only when the economy began to exhibit some signs of coming direct tax changes—the granular detail of every Budget that back to life as the spread of the pandemic peaked that livelihood left everyone, from the middle class to the stock markets, in a became a policy focus. Net-net, the Union Government spent tizzy—in the Union Budget was transferred to a new federal far beyond its means—exactly why the fiscal deficit witnessed entity, the GST Council. And after the big tweak in corporate a record slippage to 9.5 per cent of GDP in the current fiscal year. tax rates in late 2019, the excitement and anticipation about However, the finance minister had imbibed a very impor- the Union Budget diminished that much more. tant lesson in this period, which has been incorporated in Consequently, the Union Budget’s focus was gradually evolv- the ‘Big Bang Budget’ she unveiled on February 1st. It pivoted ing into one about expenditure management. This is because public policy focus away from leaving money in the hands of every finance minister had little left over—about a quarter of consumers and companies to funding big-ticket infrastructure the total expenditure outlay—for discretionary spending. And projects with built-in multipliers. that was because the rest of it was mostly pre-empted by annual Sitharaman has redefined the role of government and its wages, interest payments on outstanding debt and subsidies. relationship with the economy in terms of interventions. This But then Covid-19 struck. All bets were off. Almost everyone is big government with a difference: the commanding heights was baying for a course correction and a massive economic will now be occupied by the private sector. Indeed, in some stimulus to kick-start an economy which had ground to a halt. ways this Budget resonates with the Bombay Plan of 1944 in Throughout last year, the finance minister ignored unso- which the top industrialists of that time had suggested that licited advice and calibrated her spending. Despite contracting government must invest to enable the nascent private sector revenues, the Government did not revisit its expenditure com- to grow. This Budget seeks to do the same for a well-established
Sitharaman has redefined the role of government and its relationship with the economy in terms of interventions. This is big government with a difference: the commanding heights will now be occupied by the private sector. this Budget resonates with the Bombay Plan of 1944 in which top industrialists had suggested government must invest to enable the nascent private sector to grow. This Budget seeks to do the same for a well-established private sector currently in a bind
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private sector which is currently in a bind because of the pan- had ravaged every economy in the world. Further, at the helm demic. The idea underlying this Budget is the same: setting the was BJP, the new political pole, which enjoyed a comfortable stage for the private sector to perform. majority in Parliament. It had no legacy or baggage. If any- This is very different from the big reforms moment in 1991. thing, it drew from the previous NDA regime led by Atal Bihari Yes, that too was born of a crisis; though unlike now that was Vajpayee which, among other things, had hit the accelerator on caused by a mismanagement of the domestic economy. Further, disinvestment—demonstrating political courage to go ahead in 1991, it was the same Congress party, egged on by an unprec- with the outright sale of some units. No regime thereafter dared edented economic crisis, with India at the risk of defaulting on to even come close. its global dues, which ended the licence raj—the pernicious That was till Budget 2021-2022. practice of capping production through the issue of licences. In fact, the then Congress manifesto had committed to iron out the kinks in licence raj and not junk it. Undoubtedly, the nudge and a wink by the International Monetary Fund (IMF), which was providing a backstop to prevent a sovereign default, influenced THE FACILITATOR the new policy contours. “When it came to the Congress party, Rao was able to defend reforms with trickery—using Jawaharlal Nehru as a shield he Union Budget has no doubt, in the aftermath and Manmohan (Singh) as a mask,” wrote Vinay Sitapati in his of the pandemic, reclaimed its primacy. But primarily seminal book Half-Lion: How PV Narasimha Rao Transformed as a facilitator. Even though the Centre has bumped India, by far the most authoritative tome on the 1991 phase of up its own capital expenditure, its composition is economic reforms. Tsuch that it catalyses capital formation in the private sector. Thirty years later, yet another crisis served up a fresh op- The purpose of the increased capital allocations is more to gen- portunity to hit the reset. But with a difference. Unlike earlier, erate outcomes rather than output, reflecting a major shift in this crisis was on account of the Covid-19 pandemic which the mindset of the Government. The outcomes that are not
The Union Budget has no doubt, in the aftermath of the pandemic, reclaimed its primacy. But primarily as a facilitator. Even though the Centre has bumped up its own capital expenditure, its composition is such that it catalyses capital formation in the private sector. The purpose of the increased capital allocations is more to generate outcomes rather than output, reflecting a major shift in the mindset of the Government
30 15 february 2021 budgeted but factored in as expected, is the private investment. It has ordained a fundamental ideological reset wherein the Union Government no longer sees itself as the investor of the THE FISC KARMA last resort and first call. Not only is there a clear focus on stra- tegic investing but also the political will in monetising assets that have been created over the last 70 years to free up scarce he other structural change undertaken by capital. This is the real essence of the latest Budget offering. the finance minister is the exorcising of the ghost of This is the key difference between a Budget for an open the fiscal dharma. It has been in the making for 40 market economy and that for a liberalised regulated econo- years and till this Budget was an untouchable. The my. Ideologically, this is an out-and-out open economy Budget. Tidea was first introduced when India negotiated a structural Not surprisingly, in its analytical moorings, even though it adjustment loan with the IMF in 1980 to bail it out of an ex- is a pure pump priming Budget, it is more Schumpeterian ternal sector crisis. India exited the programme in 1982 and than Keynesian. Unlike John Maynard Keynes (whose ideas managed to evade implementing the reforms it had committed fundamentally transformed macroeconomics and the itself to for availing the loan. But it hung on to the idea of fiscal economic policies of governments) who advocated plain conservatism—nothing wrong in conforming to the mantra government intervention to prop up the economy and failed of spend within your means. businesses of all types, Joseph Schumpeter (the Austrian In fact, in the 1980s, the Government set up a committee un- political economist who popularised the term ‘creative der the chairmanship of Bimal Jalan to draw up a blueprint for a destruction’) believed that the economy will be driven by ‘Long Term Fiscal Policy’. Elements of this began to be progres- the animal spirits of entrepreneurs—inspiring a culture of sively incorporated into the Budget arithmetic. It gained fresh perform and perish—which is what the Government is hoping impetus after the largesse of the 1980s, wherein the Government will be unleashed such that India Inc shakes out of its stupor borrowed abroad to fund the Budget deficit, ended badly and and kickstarts the investment cycle. landed India in an external debt crisis. Soon, the fiscal deficit
The other structural change undertaken by the finance minister is the exorcising of the ghost of the fiscal dharma. It has been in the making for 40 years and till this Budget was an untouchable. Sitharaman has, despite the threat of a rebuke from the international rating agencies, decided to ditch the practice. Instead, she has given primacy to public expenditure policy over fiscal policy
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the Government is walking its talk and saying it is no longer in the business of running enterprises that can be undertaken by the private sector. A remarkable reset of the 60-year notion of the public sector as the commanding heights of the economy. Indeed, a remarkable makeover. The first time probably an official document has so openly turned up in the corner of Indian business. Presumably, BJP-ruled states will deploy the same template and provide proof of concept for this reform
became the metric to measure a Budget’s success or failure. deficit number, the ghost of fiscal deficit has been exorcised; at Thereafter, every finance minister used it as a given; got into least till 2026. From a high of 9.5 per cent of GDP in 2020-2021 it the habit of fixing an annual target and measuring their suc- is estimated to be 4.5 per cent of GDP by 2025-2026. cess in Budget management by sticking as close as possible Normally, a high level of fiscal deficit endangers the macro- to this number. This became both the means and the end. It economic stability when it is disproportionately used to finance was almost impossible to achieve these targets, encouraging current and not capital spending as it ‘crowds out’ private in- finance ministers to take items off the balance sheet and, in vestment and puts upward pressure on interest rates. A closer some instances, just cook the books. On paper, governments look at the deficit numbers reveals that the finance minister were spending within their means, but in practice, they were has done better in this fiscally profligate Budget than in the not. The outcome has been a massive debt overhang. Worse, ‘fiscally prudent’ Budget last year when 80 per cent of the fiscal finance ministers obsessing with the balancing of books often deficit was used to finance the revenue deficit; a longstanding took their eyes off the quality of spending—using the borrow- fiscal concern. As against this, in the current Budget, the share of ings to fund wages and rising debt service obligations instead borrowings going to finance capital expenditure has increased of capital expenditure to create assets. This year, for instance, from 20 to 25 per cent; certainly still very low, but better than in the finance minister has had to budget nearly Rs 80,000 crore previous years—at the very least, a new beginning. towards debt service; a sum which is sufficient to fund the rural The idea, it seems, has been to restore and recalibrate the ex- employment guarantee scheme outlay in a normal year. penditure balance that has got skewed since 2010. The finance Sitharaman has, despite the threat of a rebuke from the in- minister has, at the appropriate time, pulled back from a trans- ternational rating agencies which still use the fiscal deficit as fer payment, revenue expenditure-led Budget to a capacity- a primary metric in their risk assessment of a country, decided creating, capital expenditure-led Budget. to ditch this practice. Instead, she has given primacy to public It is in this framework that the level and, more importantly, expenditure policy over fiscal policy. By going against the prec- the structure and composition of public expenditure need to edent, tradition and wisdom of meeting or reducing the fiscal be analysed. Having secured a high level of spending, the real
32 15 february 2021 The outcome of all these building blocks coming together is growth. the expenditure balance that had got skewed since 2010 has been pulled back from a transfer payment, revenue expenditure-led Budget to a capacity-creating, capital expenditure- led Budget. Apart from securing a level of spending consistent with macroeconomic stability, the composition will engender a sustainable growth rate by promoting domestic savings and productive investment
challenge will be to make it consistent with macroeconomic stability. This has been attempted by making the public ex- penditure policy part of a systemic reform package aimed at The NEW COMMANDING raising the sustainable growth rate by promoting domestic saving and productive investment. HEIGHTS In the budgetary arithmetic, this means a reduction in rev- enue deficit as a percentage of the fiscal deficit, and allowing for an increase in the proportion of capital expenditure to he rejig of the key principles underlying the overall fiscal deficit. Even if the fiscal deficit is a bit higher, its Budget arithmetic has been accompanied by one of quality will be much better for both growth as well as infla- the most audacious moves with respect to the future tion. Exactly the sentiment influencing the stock markets; role of the public sector. After testing waters with the they are clearly making a distinction in the quality of spend- Tmove to offload Air India, the Union Government is proposing ing—alternatively, in the normal course of things, they would to go the full distance. In the Budget, the finance minister made have baulked at the prospect of a government going in for clear that the presence of the public sector will be restricted to such a big borrowing. a few strategic sectors—identified as: Atomic Energy, Space The new structure of public expenditure, biased as it is in and Defence; Transport and Telecommunications; Power, favour of infrastructure, rightly recognises the severity and Petroleum, Coal and Other Minerals; and Banking, Insurance seriousness of supply-side constraints that are holding back and Financial Services. growth and in some instances contributing to price pressures. The policy statement annexed to the finance minister’s A focus on public expenditure policy will go a long way in speech adds, and very bluntly at that: ‘In non-strategic sectors, addressing another structural constraint: the decline in the sav- CPSEs will be privatised, otherwise shall be closed.’ ings and investment rate. If these are restored through changes Explaining the logic of the new policy, the statement says: in public expenditure policy, growth will revive on its own. ‘[The idea is] Minimising presence of Central Government
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The Budget has explicitly accepted that unmanaged health risks have the potential to cause unprecedented economic disruption. It has also tacitly acknowledged that the current level of spending on healthcare, a little over 1 per cent of GDP, is inadequate. The underlying idea is very simple: prevention is better than cure. So, by ensuring basic hygiene and drinking water, a range of illnesses can be contained. it is not enough. But it is a beginning as well as a signal of a mindset reset
Public Sector Enterprises including financial institutions and Infrastructure Pipeline (NIP), the body created in 2019. The NIP creating new investment space for private sector.’ launched with 6,835 projects has now expanded its pipeline Ergo, the Government is walking its talk and saying it is to 7,400 projects. About 217 projects worth Rs 1.10 lakh crore no longer in the business of running enterprises that can be have been completed. undertaken by the private sector. It is the explicit political This prioritised infrastructure spending on roads, afford- acceptance of what was known to academicians and policy- able housing, railways, power, etcetera, will address various makers for long — that public sector investment/expenditure infrastructure bottlenecks, boost the core sectors, and create a provides less efficient outcomes compared to the private sector. multiplier effect on the economy. The associated job creation A remarkable reset of the 60-year notion of the public sector as would eventually translate into higher consumption as well. the commanding heights of the economy. Indeed, a remarkable makeover. The first time probably an official document has so openly turned up in the corner of Indian business. Presumably, BJP-ruled states will deploy the same template and provide GROWTH, GROWTH, proof of concept for this reform to be made universal. Alongside, the finance minister has given fresh wind to an ex- GROWTH isting proposal to monetise public infrastructure. The resources thus freed are to be used as a key financing option for new in- frastructure construction. “A ‘National Monetization Pipeline’ he outcome of all these building blocks coming of potential brownfield infrastructure assets will be launched. together is growth. In this year’s Budget, the expen- An asset monetisation dashboard will also be created for track- diture balance that had got skewed since 2010 has ing the progress and to provide visibility to investors,” she said. been pulled back from a transfer payment, revenue The proposal is to link the proceeds from this monetisa- Texpenditure-led Budget to a capacity-creating, capital expen- tion of assets to the projects awaiting funding in the National diture-led Budget. In this, Sitharaman has also tweaked the
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expenditure strategy of her mentor and predecessor Arun Jaitley. mode because of the pandemic, the autonomous investment Apart from securing a level of spending consistent with demand will, over the next three years, see a restoration of macroeconomic stability, the composition will engender a the earlier level of savings. This is important from the point sustainable growth rate by promoting domestic savings and of view of keeping the current account deficit in check and productive investment. insulating the external account and, in turn, will keep the The new structure of public expenditure has recognised currency risk at bay. the severity and seriousness of supply-side constraints that are holding back growth. So even with a lower level in real terms, the structure and composition of the budgetary expenditure will generate growth. Be it through encouraging infrastructure debt funds done A PANDEMIC BUDGET earlier or credit enhancement mechanism for infrastructure financing institutions or the setting up of a new Development Finance Institution (DFI) with more suitable maturity and n the run-up to this year’s Budget, one issue was ap- quality of funds, it will go a long way in not only propelling parent. The health sector desperately needed a reset. Seven autonomous investment demand through a change in the decades of neglect of public policy has left both lives and composition of public expenditure but also providing liquid- livelihood at risk. The Covid-19 pandemic demonstrated ity for financing infrastructure and thereby reducing the ca- thatI geography is no defence against the growing trend of pacity constraints. vector-borne diseases. Worse, it is neither the first nor is it go- While the economy is still in a comatose consumption ing to be the last.
If the last one year is any indication, the country’s central bank is very likely to step up to the plate. In the aftermath of the Covid- induced economic mayhem, the RBI aligned its vision with that of the finance ministry to focus on growth. the RBI ensured ample supply of liquidity to ensure, in turn, that the additional borrowing undertaken by the Union Government to fund the stimulus did not crowd out private sector demand or disrupt the bond market. This newfound bonhomie is unlikely to be revisited soon
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ON BREWING A BUDGET Haseeb Drabu taps his own experiences as a technocrat politician and minister to share a personalised take on making a budget
udgets of governments, the pool account was transferred to the Consolidated Fund of world over, are an exercise in politi- India, known as the Geethakrishnan effect (KP Geethakrish- cal economy, not arithmetic. It is as nan was the then finance secretary), to show a lower fiscal much about voters and supporters deficit number. The IMF conditionality got over because the as it is about investors and taxpayers. Government of India found it easier and simpler to terminate The context, political as well as eco- the loan agreement than find news of fudging! nomic, in which the budget is being Or the time when the original public finance guru, Raja presented, must inform the content Chelliah, advisor to the finance minister, came up with a B of the budget. simple solution to reduce the fiscal deficit without raising It is generally not known but more time and effort is spent the revenue or cutting the expenditures. He suggested hik- on navigating the budget through the risk-averse and largely ing the dividend from the Reserve Bank of India (RBI) from status quoist bureaucratic system. My personal experience has Rs 150 crore to Rs 1,500 crore! The RBI boss, like most Budget taught me that even greater negotiating skills are required to analysts, discovered the sleight of hand a day later after read- on-board party colleagues and build a consensus especially ing the fine print. on the budget within a coalition government. Nirmala Sitharaman’s Budget, high on EQ, seems to have CUT NOT YOUR COAT been helped in conception, design and style by a few things ACCORDING TO YOUR CLOTH that stand out in all good budgets. A sovereign to be a sovereign, is better off buying the cloth according to the coat it needs. As the Polish economist, Michał SAY IT AS IT IS Kalecki, said about capitalists, governments earn what they The first step is to ensure that the basic ingredients, the num- spend. Unlike individuals and households who spend what bers in the budget, are not adulterated. As Chef Jean-Pierre they earn. famously said, if you put pure ingredients, you will get a parfait Budgets should not be made with revenue receipts as the dish even if you are a bad chef. determining policy variable. Expenditure should be the focus By recognising the reality and reporting it when the arch and fulcrum of the budget. Based on a firm understanding lights were on, the finance minister of the economic situation, a policy deci- has restored the integrity of the Budget sion should be taken by the finance min- numbers. This is even more creditable ister about how much expenditure, as a because some of the official numbers percentage of GDP, must be made. That generated by this Government—the The state budget of done, the resources team should be put unemployment census, the GDP esti- Jammu and Kashmir to work to finance this level of expendi- mates—would have failed the smell ture. It is this feature that differentiates a test. PC Mahalanobis, the father of the was a fiscal wreck. sovereign’s budget from a home budget. official statistics of India, would have I discovered it was Putting expenditure at the core of definitely taken umbrage. all because of one the contraction was the most critical The fiscal deficit figure at 10.8 per sector: power. The gap input given by Bimal Jalan, chairman cent, for instance, is the most accurate between expenditure of the Economic Advisory Council to figure in a long, long time.T he Budget the Prime Minister (EAC-PM), to then became a Fudget in the 1990s when the on power purchase Finance Minister Manmohan Singh. International Monetary Fund (IMF) andpower receipts, the I recall this from my days in the EAC. had put a fiscal deficit number as a ‘financial power deficit’, From the point of view of budgetary conditionality. Being stuck with hav- was more than the arithmetic, this is what made the Budget ing to meet that given number, a lot fiscal deficit! So, it made for 1991-1992 a game-changer in fiscal of creativity was expended on fudging policy terms. the number. sense to keep power Exactly three decades later, that is Recall how the surplus in the oil out of the main budget exactly how Team Sitharaman has con-
38 2 APRIL 2018 Sitharaman’s Budget has explicitly accepted that unman- aged health risks have the potential to cause unprecedented economic disruption. It has also tacitly acknowledged that ON BREWING A BUDGET the current level of spending on healthcare, a little over 1 per Haseeb Drabu taps his own experiences as a technocrat politician and minister to share a personalised take on making a budget cent of GDP, is inadequate. “Taking a holistic approach to Health, we focus on strengthening three areas: Preventive, Curative, and Wellbe- ing,” Sitharaman said. structed their Budget. Of course, the decision to do so has Besides developing capacities in primary, secondary and been driven by the crying need for a fiscal stimulus which tertiary care health systems—funded by a new programme has at best been inadequate so far. Having done that, al- with a budget of Rs 64,180 crore to be spent over six years—the locate according to your need. strategy commits to providing drinking water universally, a holistic plan to rewire urban India under an Urban Swachh RESTORE THE BALANCE, BOLDLY Bharat Mission 2.0 with a total financial allocation of Rs 1.41 Having made the level of expenditure the soul of the bud- lakh crore to be spent over the next five years. get, life gets breathed into it by allocating it to sectors that Including the cost of funding the Covid-19 vaccine pro- are chocking growth. gramme with an initial budget of Rs 35,000 crore, the total The state budget of the then Jammu and Kashmir was outlay under ‘health and wellbeing’ has been bumped up to always perceived as a fiscal wreck; something beyond a staggering Rs 2.23 lakh crore—compared to Rs 94,452 crore redemption. After I took over as finance minister and in 2020-2021. conducted a detailed examination of the budget maths, I The underlying idea is very simple: prevention is better discovered it was all because of one sector: power. The gap than cure. So, by ensuring basic hygiene and drinking water, between the expenditure on power purchase and power a range of illnesses like diarrhoea, responsible for significant receipts, the ‘financial power deficit’, was more than the fatalities, can be contained. fiscal deficit! So, instead of trying to alter the entire fis- Yes, even now it is not enough to fund the health needs of cal set-up, it made sense to keep power out of the main India. But it is a beginning as well as a signal of a mindset reset budget and provide for it separately. That is why I set a in the approach to healthcare. Since health is a state subject, the precedent and presented the power budget, in addition collective success of this programme depends on a coordinated to the general budget, in the state Assembly. effort. Easier said than done, especially given that states are even The focus on capital expenditure in the Union Budget more resource-strapped than the Union Government. was long overdue. Last year, just as an example, the Govern- Even though this Budget is decisively pro-business, it is ment spent Rs 15 on overheads to execute Re 1 of capital ex- also a social Budget that proposes to use market instrumen- penditure. This is a little noticed allocative anomaly which talities to reset the economy. Implemented together, it should has huge macroeconomic implications. The only way to trigger a recovery; the former will address the demand-side improve this is to cut the revenue expenditure which is not issues while the latter will ease the supply-side constraints. It easy to do with 80 per cent of it pre-empted as salaries, in- is consistent with the ideology of this Government which pre- terest payments. So the only solution is to improve capital fers empowerment over entitlement—the idea that people expenditure. And back it with a slew of policy initiatives. are happier if they are taught how to fish rather than simply The only Budget that I recall having done this better than being handed the fish. the current one is the Budget of 1996 which allocated re- sources to the housing sector and complemented it with a slew of market-making policy initiatives. To deliver on the ground, this expansionary Budget needs to be executed in partnership with the state govern- OVER TO RBI ments. And it is this that could well be the Achilles heel of the Budget. The only discordant note in an otherwise good Budget is the shrinking role of state governments in ith such an expansionary fiscal policy, policy matters. As it is, the states are nothing more than attention will inevitably shift from Raisina expenditure disbursing institutions. The policy and pow- Hill in New Delhi to Mint Street in Mumbai. ers to design have increasingly been centralised, deny- Whether or not the economy will revive, ing states any skin in the game. The non-participation willW now depend on how the Reserve Bank of India (RBI), India of states could well dampen the success if not the spirit Inc and the banking sector respond to the challenge. of this Budget. The planned revival and recovery of the economy That would be a tragedy. n will require a complete coordination between the fiscal
2 APRIL 2018 www.openthemagazine.com 39 Openomics 2021 UNion Budget
While it is a fact that the Budget is not the panacea for all of the country’s economic challenges, it is also true that the finance minister missed a trick. The most critical deficit facing the Indian economy—the natural resource deficit—is conspicuous by its absence
The impact of Sitharaman’s Budget will reverberate across the economy; the euphoria has already seized the markets with the Sensex scaling Mt 50K. At the same time, it has given BJP ownership of a distinct economic ideology. Till this Budget, its economic policy was similar to that of Congress in the 1990s
policymakers and the mandarins of monetary policy. of devaluation—and an effort was made to stall the second There cannot be an RBI prescription for reviving growth round of devaluation. It was pulled off because Manmohan that is at variance with the finance ministry policy for it. The Singh and RBI’s then deputy governor, C Rangarajan, colluded same is true for inflation. The perspective of the central bank in making the latter go incommunicado till the second round and that of the finance ministry, to the extent that these are of devaluation was carried out. Such behind-the-scenes mo- at variance, only change the nuances and the emphasis of ments will crop up even now but they will have to be handled the policy. with conviction and courage. To close the loop, the new public expenditure policy has to If the last one year is any indication, the country’s central be complemented by fiscal and monetary policies to provide bank is very likely to step up to the plate. In the aftermath of the greater liquidity to the infrastructure sector that has become Covid-induced economic mayhem, the RBI aligned its vision a binding constraint for growth. Maybe the current team can with that of the finance ministry to focus on growth. Through- take a leaf out of the 1991 episode. In July of 1991, when the out most of last year, the RBI ensured ample supply of liquidity ‘hop, skip and jump’ strategy of devaluation was implemented, to ensure, in turn, that the additional borrowing undertaken the political class got cold feet after the hop—the first round by the Union Government to fund the stimulus did not crowd
40 15 february 2021 out private sector demand or disrupt the bond market. This India’s financial savings to physical assets and can use the same newfound bonhomie is unlikely to be revisited soon. to mitigate the macroeconomic issues facing the country. Like the innovative proposal in monetising public in- frastructure assets, the Government could have proposed a natural resource investment trust. Such a trust would own a THE OMISSION portfolio of natural resource assets across the world, focusing on those of critical importance to India. A well designed natural resource investment trust would hile it is a fact that the Budget is not the not only help address India’s natural resource deficit but also panacea for all of the country’s economic provide a channel for domestic Indian savings into physical as- challenges, it is also true that the finance min- sets, address the balance of payments challenge in a structural ister missed a trick. The most critical deficit fashion and also provide Indians with a naturally inflation- facingW the Indian economy—the natural resource deficit—is hedged investment avenue. conspicuous by its absence. To sum up, the impact of Sitharaman’s Budget will reverber- Besides importing two-thirds of its oil requirement, India ate across the economy; the euphoria has already seized the is slated to overtake China as the world’s largest coal importer markets with the Sensex scaling Mt 50K. At the same time, it over the next decade, even though China’s coal consumption has given BJP ownership of a distinct economic ideology. Till is over six times India’s. Even in the case of iron ore, India has the presentation of this Budget, barring the trimmings and slipped from being the third-largest iron ore exporter globally wrapping, BJP’s economic policy was similar to that designed and is now at risk of becoming a net importer soon. by Congress in the 1990s. The highlight of this differentiation It is also important to realise that this natural resource defi- being the emphasis on the internal institutional reforms, as cit is the primary source of the macroeconomic vulnerabilities distinct from external liberalisation. the country is facing. As the late Arun Jaitley, also the mentor of Sitharaman, once First, the main driver of the current account deficit on the bal- pointed out, proof of concept is key to winning public confi- ance of payments has been oil and gold imports. Second, a large dence—citing public services like electricity as an example, element of India’s persistently high inflation has been driven by he had said that one can only charge the cost price for it after energy and commodity prices. Third, the fiscal deficit has bloated one delivers reliable and 24x7 power. What the Modi regime over the years primarily because of energy subsidies overshoot- has done in the last six years by targeting leakages is restore ing conservatively budgeted projections. Thus, there is clearly a primacy and faith in the public delivery system. Sitharaman’s need for an innovative structure that can appropriately channel Budget takes it to another level. n
Haseeb Drabu is an economist Anil Padmanabhan is a Delhi-based journalist who and the former finance minister writes on the intersection of politics and economics of Jammu and Kashmir in his weekly column ‘Capital Calculus’
2 APRIL 2018 www.openthemagazine.com 41 Openomics 2021 UNion Budget
MAKING INDIA FUTUREPROOF What Budget 2021 offers from the top to the Bottom of the socio-economic Pyramid
Source: Ernst and Young Illustration by Saurabh Singh Illustration by Saurabh Singh Rich 1 Double taxation removed for NRIs
2 No introduction of wealth tax and cess despite fiscal needs
Middle 1 Extension of interest deduction for affordable housing class 2 Time-bound access to bank deposits to the extent of deposit insurance cover 3 Late deposit of employee’s contribution to EPF by employer will not be allowed as deduction by (expense to) employer 4 Vehicle scrappage policy
New 1 Boost to affordable rental housing construction for migrant workers Middle class 2 National Apprenticeship Scheme for skill development 3 Minimum wages will apply to all categories of workers. They will all be covered by Employees State Insurance Corporation
4 Incorporation of one-person companies made easier with no need for start-up capital
New 1 ‘One Nation One Ration Card’ to help migrants access PDS Poor at their place of work 2 Portal to collect relevant information on gig, building and construction workers. Will aid in providing health, housing, skill, insurance, credit and food benefits to migrant workers
Poor 1 PM Atmanirbhar Swasth Bharat Yojana launched to develop primary, secondary and tertiary healthcare systems
2 Supplementary Nutrition Programme revamped as Mission Poshan 2.0 to strengthen nutritional content, delivery and outreach in 112 aspirational districts
3 Jal Jeevan Mission (Urban) for universal water supply in all 4,378 urban local bodies in 5 years 4 Ujjwala Scheme to supply cooking gas extended to cover 1 crore more beneficiaries 5 Rs 1,000 crore for welfare of tea workers in Assam and West Bengal
6 Target of establishing 750 Eklavya model residential schools in tribal areas
7 Post Matric Scholarship Scheme for welfare of Scheduled Castes
8 Stand-Up India loans made attractive for Scheduled Castes, Scheduled Tribes and women
www.openthemagazine.com 43 Openomics 2021 Interview
Finance Minister Nirmala Sitharaman PEOPLE ‘WANT THEIR GOVERNMENT TO ENSURE OPPORTUNITIES. THEY DON’T WANT TO
CONSTANTLY LOOK TO‘ IT FOR DOLES
Photo getty images By PR Ramesh
This year’s Budget was billed as a ‘never before event’ meant to address an unprecedented contraction in the economy engendered by the Covid-19 pandemic. To ensure that her Budget is a big-bang force multiplier on jobs and asset creation, the finance minister buried fiscal deficit constraints. Speaking to Open, she asserts that it is time to abandon the socialist baggage and mark the directional change an aspirational India wants. Her mantra is to end the ambiguity in economic policymaking and focus on getting government out of non-strategic areas
This is a big-bang exercise that has restored the primacy of the Union Budget in the country’s micro-economic framework. The Government is going to be the biggest spender and force multiplier. Is this going to be the new pattern? The Budget had to show that the Government is not averse to spending or to giving the neces- sary stimulus to the economy and that it has listened carefully to so many people who have given their counsel. This spend, for providing a stimulus to the economy, is also a responsible spend—responsible both in choosing the time, and responsible in targeted expenditure. By this, we aim to achieve two things. First, the force mul- tiplier that infrastructure brings with it—some speculated it is 1:1.25 and some others say that it’s 1:2. For every rupee spent, this is the kind of multiplier effect it would bring and, therefore, infrastructure is the preferred route. It will also have an immediate bearing on people getting jobs, work for the skilled and the semi-skilled and real opportunities for the unskilled. And second, we also realise that the quality of spending can be monitored well when you do this. It’s no secret that there’s a resource constraint. It’s no secret that the funding will have to come through bor- rowings that the Government is going to do. Dis- investment is going to give me non-tax revenue, but that will take a few months from now Openomics 2021 Interview
to start trickling in. So, qualitative spending, creation of assets you propose to manage the fallout? and providing jobs immediately will—by the assertions of The youth of this country are looking for that narrative from the economists and even critics of the Government—for sure, put Government. Are you conscious of a vibrant India, are you con- India in a virtuous cycle. That’s why this Budget has chosen this scious of an entrepreneurially successful India and, therefore, path. I cannot say whether this will be the new pattern, but that are you going to empower them or are you going to persist with will depend on how the economy picks up and how my revenue a smokescreen that says “I’m the authorising or licensing agent generation improves. With this thought in my mind that a glide and without me giving you that permission, you cannot do any path will have to be kept for fiscal prudence. legitimate entrepreneurial activity”? That smokescreen had to be got rid of. And that’s what we have done. For the first time, you have buried the ghost of fiscal deficit constraints and shifted focus to public expendi- The big takeaways suggest a ‘mindset reset’ for the ture. Earlier, public expenditure was a residual of fiscal country. Do you think India is ready for it? policy and government had little freedom to spend. How It is a reset certainly. It is a reset where government will have do you explain this change? to speak the people’s language. People want their efficiency I have given myself space to be able to do this by stretching the rewarded. People want their skills to be upgraded and given deficit. The number that I have shown will give me that space. I due recognition. People want an honest profit to be appreci- have chosen to spend it on capital expenditure. We thought of ated. People want duties with responsibilities. People don’t this as an opportunity for the Government to state clearly what want patronage. People want government to ensure oppor- it stands for. Equally, to remove the socialist baggage and mark tunities and don’t want to constantly look to it for doles. So, the directional change which aspirational India is looking for. it’s an explicitly stated agenda rather than a couched agenda. The youth, who constitute two-thirds of our population, firmly How else would you do it? If a mandated government doesn’t believe that there are many things that government has no busi- state it, there will always be the doubt that discretion would ness being in and that it should not squander away taxpayers’ come into play. It can come into play by favouring some and harassing some others. So how much ever you talk about cleaning the sys- tem, that would be only at the edges rather than getting into the core. The ordinary taxpayer of this country longs Qualitative spending, creation for that day when every rupee s/he paid “of assets and providing jobs would be counted. When s/he sees that the money, which s/he is honestly pay- immediately will put India in ing as tax, is going down a black hole,
a virtuous cycle. That’s why the there is bound to be revulsion. Espe- cially when s/he sees that the money
Budget has chosen this path. I cannot is being sunk into companies on their deathbed, it is natural for her/him to say whether this will be the new “ be disgruntled about honestly paying pattern, but that will depend on how taxes. The taxpayer may not expect to the economy picks up be rewarded directly, but s/he expects government to be responsible in spend- ing that tax money. There are still some areas where the public sector has a role to play. But to deny private participa- money on enterprises that can be handled successfully by private tion in every sector is convoluted thinking. players. Aspirational youth is restless because of the ambiguity in the economic policies practised in the country. We wanted The mindset was always there. The mindset wanted the to address that ambiguity. We believe that policymaking has to country to be unfettered. It was the political class which get rid of that ambiguity and say “no” to government presence was not recognising it. in non-essential areas. That’s one thing that I want to underline The Jana Sangh and the Bharatiya Janata Party (BJP) believed, about this Budget. while keeping in mind that the nation had to be strong and self-re- liant, that individual enterprise should not be scuttled. That profit The big shift that you signalled is the exit of the public can never be a bad word. But look at Congress. Without batting an sector from non-strategic areas. It is economically eyelid, they are the ones who have switched completely from the powerful but could be politically troublesome. How do socialistic agenda to claiming credit for opening up the economy.
46 15 february 2021 How much did that get discussed in any one of the AICC sessions? How many vot- ed for it and who were against the policies The ordinary taxpayer longs adopted by its governments? Look at the “ radical shift they can make—claiming for that day when every rupee at one time that they believe in nation- When alisation and at another time that they he paid would be counted. are the most economically progressive. he sees that the money is going down That is the landscape of acute contradic- a black hole, there is bound to be tions in which Congress finds comfort. We, on the other hand, have been say- revulsion. The taxpayer may not expect ing from the days of the Jana Sangh that to be rewarded directly, but he expects India’s strength lies in the capabilities of its entrepreneurs but they have been fet- the government to be responsible in tered constantly by the licence quota raj. spending tax money Is it not time now to ensure that the next generation does not suffer in such situa- tions? That’s why we chose to clear the ambiguity on policymaking. Two-thirds of India—the youth— The popular mood may have been for unleashing the animal spirits, but are waiting to perform. That’s the that was not being reflected in the connect I wanted to bring to this Budget. policy response of previous govern- Allow them to enter every sector, every ments. There was a gap—the public was ahead but fear was holding the area. You have no right to sit on “ political class back. non-performing assets. We have to be Yes, it was important to address this mismatch. Otherwise, the youth of this accountable to the people country—and I repeat, two-thirds of the Indian population—is not going to like it if government looks the other way even as aspirations are voiced by people. They want the opportunity to prove their worth. That’s why I quoted should earn the maximum for people who are investing in it. the example of the cricket victory in the Budget. The captain was We borrow from it. I am not saying that tomorrow that kind of not there. The team did not lose spirit nor distrust its captain borrowing may not happen. That could happen. But the Govern- but performed as a team with an insuppressible thirst to win. ment has clearly acknowledged where an item should actually Two-thirds of India are waiting to perform. That’s the connect I be and where an item should not be. There is no stealth. I would wanted to bring to this Budget. Allow them to enter every sector, be the last person to pour taxpayers’ money into economic activ- every area. You have no right to sit on non-performing assets ity that makes no sense for government to be in. (NPAs). We have to be accountable to the people. Now take the running of airlines. Every government agreed that it was no longer possible to run Air India. No one would Some experts say that it’s one of the five most disruptive disagree. But in order to keep it alive, I am pouring more taxpayer Budgets in independent India. How do you see the money into it. I should do it if there is an emergency, one-time movement forward? need. Now it has become an annual ritual. Is it going to be better- Let me tell you what I have done in the Budget. Everyone wants run by me as it stays now? Probably not. Every government tried transparency everywhere. Government, therefore, should keep to make Air India run well. I am not accusing anyone. But can its books transparent. And how many governments controlled I do it now? Can any government do it now? Therefore, I think by different parties genuinely attempted to clean up the books? putting taxpayers’ money into something that doesn’t show any Yes, I made the best of the pandemic. I used this opportunity to prospect of running successfully is wrong. At the end of the day, I clean up the books. And that’s why you find the funding for the am responsible for ensuring that every rupee of taxpayer money Food Corporation of India (FCI) is not kept out of the balance is not misused or used irresponsibly. sheet. We brought it on to the statement. The National Social Se- In my childhood, I had this curiosity about the bills that curity Fund (NSSF)—which is actually a savings programme— shopkeepers would give after purchases. At the bottom of the
15 february 2021 www.openthemagazine.com 47 Openomics 2021 Interview
bill there used to be ‘EOE’ written. For a very long time, I did not buying at a certain value, looking at the actual value of that com- know what it meant. I checked and found that it meant ‘Errors pany on that particular day and so on. Already, banks have been and Omissions Expected’. He is indemnifying himself against making provisions for these NPAs over the years and, strictly any possible legal action. It covers the shopkeeper from any speaking, by now some of these assets are left with only 15 or 20 omissions and errors. For the money that I get from the taxpayer, per cent of the value. The rest has eroded. Now, if they are the ones I cannot have omissions and errors. Can the finance minister going into this holding company, they will be buying through claim EOE type of immunity? Certainly not. a competitive bidding process that is open. They will take this asset, giving a certain amount of money, and from that money Another big idea in the Budget is that of the bad banks. banks will receive whatever they are expected to receive. As it is, When will it be operationalised? they are shorn of the value. And the mechanism will help banks I have not said that. What I am setting up is not a bad bank. It’s ac- get out of this. Why banks cannot do this instead of giving it to a tually a formulation by which we will have a holding company holding company is a legitimate question. But banks do not have to be held by all the banks. The Government may give a little the wherewithal to deal with this. They are expected to run the amount to it. But it’s entirely the banks’ own arrangement. It’s a bank, lend, make money out of it, keep the books, and spread company into which all these NPAs will go and the Reserve Bank the banking culture. They are not here to value it, handle assets of India (RBI) will provide the supervisory guidance. And once and dispose of them. If that is the reason for a bank to sit on these these NPAs go into it, through asset reconstruction companies NPAs, government has to constantly fill the provisions—equity that are in the open market, there will be a process of bidding and capital—to run it. How long can this go on? Again, there is the principle of taxpayers’ money—am I go- ing to use it to fill these gaps? Instead, if I give this taxpayer money for lending, it will make the economy a lot more robust. I have to adhere to this principle of being I used the pandemic to clean honest with the taxpayer: give him the “ returns for his honest money and not up the books. That’s why you find shove it down unending black holes or that funding for FCI is not kept out of pour it down businesses that cannot run the balance sheet. The NSSF should well. That is the philosophy. This is the disruption that the Budget would do. The earn the maximum for people who holding companies will get operational are investing in it. We have clearly once the Budget session is over.
acknowledged where an item should Once the debts are off the books, actually be and where it should not be. the cost of lending has to come down. How will this play into the There is no stealth investment cycle? Banks will have more money to lend. If the NPA burden is removed from their head, the money that they earn will be What I am setting up is not a available for banking business.
bad bank. It’s a formulation by which You have announced several initia- we will have a holding company for tives for Micro, Small and Medium Enterprises (MSMEs). But how do all the banks. It’s a company into you propose to handle their funda-
which all NPAs will go and the RBI will mental problem: access to credit? Are you going to coordinate with the
provide the guidance. Once the NPAs RBI to figure a way out? I think the solution cannot just be one- go into it, through asset reconstruction “ sided. There are different aspects which companies in the open market, there limit an MSME from credit. It could be will be a process of bidding and buying the nature of the entity’s operation where the flow of its earnings has a different cal- endar from that of the bank. The bank’s
48 15 february 2021 credit servicing calendar does not match with an MSME whose payment calendars are very different. As a result, it is constant- When I give interest subvention ly borrowing to keep this calendar going. “ That’s one problem. Second, is the compa- or tax-related exemptions for ny big enough to be under the Goods and Services Tax (GST) regime? Because once affordable housing, is it not for it comes into GST, it has some advantages. the middle class? When I talk Its input credits can be got back. Then, if it is on a TReDS platform (an online mecha- about better education facilities, is nism for facilitating the financing of trade that not for the middle class? In EPFO, receivables of MSMEs through multiple we told employers if they took back financiers that pulls in many private com- panies, PSUs and public sector banks), it people we would bear the employee’s “ gets discounting benefits. The biggest contribution for two years. Is that problem for the MSME is whether it’s a government or a large corporate body not for the middle class? to whom it supplies. Payments may not come on time. Today, the Government does not sit on payments beyond 45 days. There are ministers like us who breathe down the system to pay up. But no one in government can tell the board. So when I give, let’s say, interest subvention or tax-re- a corporate body to pay up. They know their business and how lated exemptions for affordable housing, is it not for the middle to run it, and I fully respect that. In a way, they also state in their class? When I talk about better skill training and education facili- annual report to the Ministry of Corporate Affairs how much ties, is that not for the middle class? In the Employees’ Provident they owe their suppliers. But all this does not help MSMEs. So, Fund Organisation (EPFO), we came up with a scheme where when you talk about an MSME’s problem of accessing credit, it’s we told employers that if you take back people we will bear the not a problem of only banks not providing funds. employee’s contribution for the next two years. Is that not for the When you talk about an MSME, it’s also not a homogenous middle class? I can go on. Rs 5 lakh Ayushman Bharat scheme— problem—a problem across the board. Yet today, this Govern- is that not for the middle class? ment, even during a pandemic, has given a lot of time, money, energy and application of mind to make sure that we understand Your Budget has defined policy focus on healthcare to each one of these problems. Let me give you an example. Emer- include drinking water. Is this similar to redefining gency credit was given to MSMEs to provide additional liquid- poverty by going beyond mere calorie consumption? ity without additional security demands. This is just so that the Why did we do this? What does the Swachh Bharat Abhiyan tell MSME got money to meet the new demand. But it’s a unit which is us? Many health-related peer group reviews said that because already an NPA. Even before the pandemic. So banks will not give of Swachh Bharat, there has been a drastic reduction in serious it additional liquidity. Thus, we came up with another scheme. illnesses among women and children. This means health is di- A lesser known but a critical one: the subordinate debt scheme. rectly influenced by sanitation, clean drinking water and overall Why did we come up with it? We said: your company per se may civic cleanliness. I took a conscious call on this because health not meet the bank’s requirements to get some additional loan, but per se will get money—but I cannot look at health as a separate you as a promoter can get that loan. Tell us what your share is in silo involving only treating patients who come with illnesses, or the company and you can get debt as an individual on the basis even as one only involving a preventive, curative and wellness of that. Take that debt from us, but put it as debt in your company. approach. What’s the point in giving money to a hospital to buy The moment you show it as equity, the bank will give you money. the best machines, imported gadgets for diagnoses, etcetera, if it’s We made that arrangement and quite a number of pre-Covid overflowing with filth? We have to address the issue holistically. NPAs could access these funds. We expanded the definition of MSMEs. By that, they became beneficiaries of many schemes. Do you feel vindicated? You have been a target of We also came up with a rule that in government tenders less than vilification campaigns by leaders of the opposition. Rs 200 crore, global tenders will not be allowed. I am doing what I am expected to do. I am not averse to criticism. I am okay with people giving me suggestions, not this The middle class feels left out. What do you have to say way but in some other way. It concerns me only to the point about that? that I want to keep my eyes and ears open always to accept As with MSMEs, this is not one vertical group. It is spread across good advice. n
15 february 2021 www.openthemagazine.com 49 Openomics 2021 Growth
Saugata Bhattacharya the New Consensus a blueprint for sustained growth
inance Minister Nirmala Sitharaman backward and forward construction linkages, and measures to had promised that this post-pandemic Bud- attract foreign capital, including tax holidays and exemptions get would be “one never seen before”. And for aircraft leasing companies at Gujarat International Finance in large measure, she and the Government Tec (GIFT) City. have delivered. The Budget is a formal mark- Growth and revenue assumptions are realistic. Nominal GDP er of a transition to the third leg of a “Sur- growth for FY22 is forecast at 14.4 per cent, which is likely to F vive, Revive and Thrive” strategy which has be an underestimate and therefore will help the fiscal maths. been the ostensible response to the Covid This will also act as a buffer against the uncertainties and risks public health crisis. Acknowledging the severity of the economic of a second surge of infections in India, and subsequently more loss, this is every bit a growth-oriented Budget as we could ever restrictions, although the chances are falling, with the vaccina- have expected, reversing course from the fiscal discipline and tion programme rollout. prudence which have been this Government’s fiscal thinking. Is the Budget trying to window-dress spends? A laudatory It is aligned with the Economic Survey’s support of the need for aspect is that the Budget further increases transparency. At least a countercyclical fiscal stance, arguing that boosting growth one large off-balance-sheet item, small savings loans to the Food will be the best bet to sustain India’s debt. 2020 was not a nor- Corporation of India (FCI) for food subsidy, will now have direct mal cyclical downturn, but a once-in-a-century shock causing a budgetary allocations. This is a further advance from the mea- permanent economic loss. Yet, with fiscal prudence temporarily sure of enhanced disclosures in earlier Budgets of borrowings in abeyance, there is also a commitment to Fiscal Responsibility by government agencies to fund Government of India schemes. and Budget Management (FRBM) and fiscal consolidation over Consider FCI. Of the total borrowings as of December 2020 of the next five years. Global credit ratings agencies have also sup- Rs 3.74 lakh crore, Rs 3 lakh crore is from the National Social Secu- ported this stance, arguably since this seems rity Fund (NSSF). This was Rs 46,000 crore to have now become the fiscal consensus. higher from the level at end-March 2020. Every Budget has an embedded political During FY17 to FY20, FCI borrowings from economy perspective. The proposal to pri- NSSF were more than Rs 2.5 lakh crore. In vatise two public sector banks (PSBs) and The Budget is a FY21 RE, the Government has allocated one general insurance company points to Rs 1.36 lakh crore to pay down part of the a deep commitment to its economic beliefs. formal marker debt (and an additional Rs 55,000 crore The Budget has now manifestly shifted of a transition to in FY22). This payment is part of the to the Thrive phase, articulating a compel- the third leg of a extra Rs 3.14 lakh crore allocated for food ling vision under the rubric of Atmanirbhar ‘Survive, Revive and subsidy (compared to FY20). Hence, a like- Bharat, leveraging multiple proposals to to-like comparison of direct Government boost both investment and demand. This Thrive’ strategy spends would need to be reduced by Rs 1.36 will help to take India to sustained high which has been the lakh crore. growth in the medium term. These include ostensible response Infrastructure capex is a key thrust area an aggressive roadmap for monetisation of to the Covid public of the Budget. This lies at the intersection of the Government’s physical and financial health crisis boosting both supply and demand. Capital assets, increased focus on affordable hous- expenditures will increase to Rs 5.54 lakh ing which can provide a boost to the long crore in FY22 from Rs 4.12 lakh crore bud-
50 15 february 2021 ing the window for re-opening tax as- sessments from the present six years to three, while limiting tax assessments in serious evasion cases only with con- currence of the highest ranking tax of- ficer, will reduce uncertainty. The re- sult of the progressive simplifications in filing tax returns has resulted in a large increase in returns filed over the past six years. So, too, is the Concilia- tion Mechanism for speedy resolution of disputes for contractors who work with government and Central Public Sector Enterprises (CPSEs). There will be challenges in imple- menting the ambitious measures. Steps for fiscal consolidation to meet the target of a fiscal deficit less than 4.5 per cent by FY26 will have to be thought out and implemented vigor- ously. On the revenue side, this will entail rising tax compliance, aggres- sive disinvestment and asset mon- etisation, realising taxes which are stuck in litigation and disputes. On the expenditure side, there will have
Illustration by Saurabh Singh to be expenditure rationalisation, to increase spending efficiencies. Note that the Agri Infra cess on geted in FY21. These spends are to be augmented by long-term petrol and diesel is price neutral for consumers, being a replace- debt financing by the proposed Development Financial Institu- ment of a tax with a cess and not an additional charge, and hence tion for infrastructure projects. Even in FY21, the pace of capex will not add to inflation. However, the higher spends entail a spends has accelerated from November onwards. borrowing programme higher than expected. This will need to Following on with the measures to incentivise credit off- be managed, since the support from banks will likely be lower take—which have been a key pillar of the post pandemic stimu- in FY22, with expected increase in credit demand. The Reserve lus measures—the Budget proposes Asset Reconstruction and Bank of India (RBI) will need to lend support to manage any Management companies to take over existing stressed loans of undue rise in bond yields and significant market disruptions, PSBs and then sell them to potential investors. While details of although it too will be constrained with the need to gradually the structure and capitalisation of these companies are awaited, drain liquidity over the next year. As is always the case, imple- and several thorny issues, such as valuations of the assets to be menting the multiple and complex Budget proposals will be transferred, are also awaited, this can potentially help to clean up crucial for translating the fiscal levels to sustained growth and bank books and increase credit offtake from a significant share will need coordinated policy response between the Centre and of the banking sector. The budgeted allocation of Rs 20,000 crore state governments. for PSB recapitalisation will also help. This is one of the quinquennial budgets which coincide As was to be expected after a public health crisis, there is a with the tabling of a Finance Commission report. More large increase in allocations for health, vaccines, drinking wa- than ever before, federalism—fiscal as well as other ter and sanitation. Expenditure on health and wellbeing is pro- dimensions—has become one of the crucial pillars for implement- posed to be increased by 137 per cent! Note that the healthcare ing reforms. As with any economic plan, execution will be key sector will play a crucial role in job creation, with the potential to translating intent to outcome. Managing the political to absorb people displaced from farming and urban areas by economy of the transformation will be the lodestone for high retraining as secondary and tertiary healthcare providers in sustained growth. n small towns and rural areas. In addition to the higher spends to support growth, the Bud- Saugata Bhattacharya is Executive Vice President and get has also sought to improve sentiment and confidence. Reduc- Chief Economist at Axis Bank. Views are personal
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Farmer Friendly Food subsidy and Minimum Support Price data show the persistence of the government’s generosity Workers dry paddy grain in North 24 Parganas, West Bengal, January 30
By Siddharth Singh
n the excitement about the Government’s huge expenditure to spur growth in the 2021-2022 Union Budget and the slew of reforms announced in the finance minister’s speech, an extraordinary set of figures was largely ignored. Tucked away in one of the an- nexures of the speech was a table detailing the money spent by the Government on pur- chasing the crops sold by farmers. To call it money-spinner would be an understatement. It is a dreary tactic to show the Government’s benevolence towards the largest pool of working people in India through a set of statistics. But these are contested times. A large group of farmers has effectively put a siege around Delhi that is more reminiscent of a medieval military situation than a group of citizens protesting in a democracy. The I pertinence of the data in Finance Minister Nirmala Sitharaman’s speech is a product of this
Photo Getty images Openomics 2021 AGRICULTURE
past is, well, in the past. But reading the fine print of the Budget tells us that this state of affairs is unlikely to end. If one looks at the sums allocated for food subsidy for three fiscals since 2019, the story is one of a rising level of resources being devoted to help farmers. The details on expenditure in the Budget show this clearly. Un- der ‘Demand 15’, the subhead where details of food subsidy are to be found, the Government allocated Rs 75,000 crore for this purpose to the Food Corporation of India (FCI) in 2019-2020. These were the ‘actuals’ for that year. If one adds another part of that demand—food subsidy for de- centralised procurement under the National Food Security Act (NFSA)— another Rs 33,508 crore has been dished out for that year. That makes for a total of Rs 1.08 lakh crore. It is worth noting that this figure is lower Sacks of wheat at the grain than the actual money dished out to market in farmers for wheat and rice as listed Gautam Buddh in the minister’s speech. This is due Nagar, Uttar Pradesh, to crop marketing seasons and Bud- April 2020 gets being out of sync. But the sums involved are huge. The last year—the year of the pan- volatile political situation. It calls out the lie that the Narendra demic—witnessed a gigantic bump in the food subsidy figure: Modi Government is anti-farmer and that sons of the soil are direct payment to FCI under NFSA and for decentralised pro- about to get a raw deal. curement under NFSA tallied to Rs 4.22 lakh crore when the The facts are very different as the 2021-2022 Budget shows. In revised figures for 2020-2021 were released. This represented a the seven years from 2014-2015 to 2021-2022, with data for the lat- phenomenal 266 per cent increase over the budgeted figure of ter year still rolling in, the Government spent a gigantic horde of Rs 1.15 lakh crore. But one can say 2020 was a horrible year and cash on farmers: Rs 3.09 lakh crore was spent on Minimum Sup- the Government did what was morally right: it fed poor citizens port Price (MSP) operations for wheat while another Rs 7.48 lakh who had no way to get food on their own. crore was spent on MSP for paddy (rice), making for a tidy total of But even here the story, one or the other, ends up with the Rs 10.5 lakh crore. This is, to put it mildly, a mind-boggling sum. farmers of north India who are the main beneficiaries of Govern- All these extraordinary numbers were delivered by the min- ment largesse. The system is complicated: the farmers produce, ister in her traditional deadpan manner, “Our Government is FCI buys from them and then ration shops hand over food to committed to the welfare of farmers. The MSP regime has un- the poor. The flow of money in the reverse direction is from the dergone a sea change to assure price that is at least 1.5 times the Government dishing out food subsidies to FCI and the latter giv- cost of production across all commodities. The procurement has ing it back to the farmers. Of course, the reverse flow is much also continued to increase at a steady pace. This has resulted in slower and takes place over many years as state governments and increase in payment to farmers substantially.” What could not be FCI squabble over who owes how much. But the one thing that hidden was that the number of farmers who benefited from this stands out in this story is the quaint expression ‘food subsidy’. It huge dollop of help had more than doubled in the case of wheat is actually ‘farmers’ subsidy’ and that too just a part of it. When (from nearly 20.5 lakh in 2016-2017 to 43.36 lakh in 2021-2022) one adds subsidies for fertilisers, fuels, seeds and many other and doubled in the case of rice as well but with much greater items that remain hidden in the nooks and crannies of Budget absolute numbers (from 76.85 lakh to an estimated 1.54 crore documents, the farmer comes out not as someone who is braving for the same two years). cold and apathy on National Highway Number 1, but someone Naysayers, being naysayers, can always say what is in the who is part of a well-entrenched interest group. The sums that
56 15 february 2021 any government is forced to shell out painfully even as it smiles continued giving more money in the hands of the poor and the and says it stands with the farmer is testimony to that. farmers at the same time. That is the secret for continuing fiscal deficits seen over the years. This was very clearly understood as a political constraint that had to be respected if economic reforms n June last year, at the height of the Covid-19 pan- had to even have a half-decent chance. demic, Prime Minister Narendra Modi had announced the More substantively, the problem with this melange of criti- I plan to roll out ‘One Nation, One Ration Card’, a scheme that cisms is that they lack consistency. The 2021-2022 Budget is held would allow portability of food entitlements across India. The to lack demand-side initiatives while focusing too much on the timing of the announcement was significant. India had just wit- supply side. In rural India, this distinction breaks down if too fine nessed a gigantic internal migration after a stringent lockdown a point is put on it. Food subsidy, which is more a producers’ sub- was announced to contain the spread of the Covid-19 virus. The sidy, keeps the economy of many north Indian states lubricated, Government’s administrative machinery swung into action to acting as a source of demand. Similarly, if poor citizens get food help migrants, to ensure availability of rations (and hence the entitlements, a large part of their consumption basket is taken huge jump in the food subsidy bill), but the time had come to en- care of, leaving them some money to spend towards other needs, sure portability. The idea made economic sense as well. Workers in effect, acting as something of a support for demand elsewhere. bereft of jobs and incomes are certain to rush back to their homes Then, there is the issue of alleged breakdown of federal bound- as they are unlikely to go hungry there. But as the 2020 migration aries with the Centre legislating on what is claimed to be a state showed, this not only caused a huge human dislocation but an subject: agriculture. But here, as in the supply-versus-demand equally large economic one. Deprived of their workers, busi- debate on the Budget, this is too much of an artificial distinction. ness and industries, too, entered a phase of distress. The chain The fact is that MSPs and their effective implementation require of events that began with the pandemic ended up causing acute financial wherewithal of the financial distress across the economic system. If only workers kind that no individual state could stay where they worked, things would have been very possesses. It is also a fact that different. these purely transactional, This Budget is Fast-forward to the 2021-2022 Budget. For the coming fiscal, market relationships are held to lack too, the food subsidy bill is high. It has come down from the high now viewed as something seen in 2020-2021 but at Rs 2.42 lakh crore, it remains 110 per of support programmes that demand-side cent higher than 2019-2020, the ‘normal’ year before the pan- provide public goods. Ideally, initiatives while demic. This is, no doubt, due to the rollout of the ‘One Nation, if this indeed was a federal is- focusing too much One Ration Card’ plan as experts say this will lead to a higher sue, state governments should on the supply side. offtake of foodgrain across states. But it is also undeniable that go ahead and devise their own In rural India, this the Government remains committed to wheat and rice farmers support programmes. But of north India, who will continue to gain the most out of the this—as anyone with even distinction breaks Government’s purchases. a cursory familiarity with fi- down if too fine None of these facts, and India’s complicated and expensive nances of state governments a point is put on system of food procurement that has evolved over time, is able to knows—is impossible. State it. Food subsidy, convince critics that the Government is not out to shortchange governments will mouth the the allegedly beleaguered farmers. The fact is that reform of the federal principle but quietly more a producers’ system is not even on the horizon. Far from the three agriculture want the Centre to foot the subsidy, keeps reform laws passed by Parliament ‘destroying’ the mandi sys- bill for what they are in no many north Indian tem, the flow of money in the food economy shows the system is position to provide. It sounds states lubricated, expanding and not contracting. clunky and awkward but the acting as a source The inconsistency in the structure of argument is worth Centre seems to be providing pointing out. There is by now a formidable critique of the Gov- a local public good when it of demand ernment’s approach to the three farm laws. What is interesting foots the exorbitant bill for to note is that the same set of critics is saying the Government food subsidy. has not done enough for the poor. Looking at the bloated food These systems were devised at a time when India was a fledg- subsidy bill one could indeed say that this is an anti-poor mea- ling and insecure nation-state. It had little money to buy food sure. Until some years ago, the same critics who today defend from international markets and had to establish its own systems farmers from north India and grain commission agents—arhti- to meet its urgent needs. But those were also days when practical yas—used to say it was against the poor people of India. Ideally, concerns were kept away from partisan and toxic ideological with their championing of these farmers, they should have aban- debates. The trouble for Prime Minister Modi is that he is trying doned the anti-poor rhetoric that accompanies every Budget. In to reform a system that is hostage to special interests and critics reality, successive Budgets under the Modi Government have who care little about what is rational for India. n
15 february 2021 www.openthemagazine.com 57 Openomics 2021 MSME
Workers in a jeans factory in Ballari, Karnataka
A Song for the Unsung In doubling the allocation for MSMES, the Budget has recognised their potential in creating employment and boosting growth
By Dhirendra Tripathi His plight is not reflected in the boomingS ensex. He has ven- dors and staff to pay but he is not sure if the banks will be willing t’s February 1st, Monday, and Aman to lend him even when the business comes back—and he needs Pahwa, owner of a unit that comes under capital. Pahwa’s small enterprise, based in Ghaziabad on the out- the umbrella of a micro, small and medium skirts of Delhi in Uttar Pradesh, is engaged in the manufacture of enterprise (MSME), heaves a sigh of relief. mechanical parts used by steel and automobile makers. Finance Minister Nirmala Sitharaman has “We are unable to get any credit from any bank if there’s a de- just wrapped up reading the 2021-2022 Union cline in the turnover in any of the past three years. 2019-2020 was Budget and there are no devils there. Pahwa is already a low due to the slowdown in the automobile sector and I far from happy though. Covid-19 has taken a then came Covid. The Budget doesn’t change any of that,” he says. toll on his business and even though it’s February and one would MSMEs in India have had it tough. Often derided by the elite imagine things to be returning to normal, his business is nowhere as a cabal of small-time manufacturers and traders evading taxes, close to pre-pandemic levels. governments for long adopted a piecemeal approach while ad-
58 15 february 2021 the Government worked in tandem to lower MSMEs’ cost of bor- rowing by facilitating cheaper capital to non-banking finance companies, the major lenders to MSMEs. A long moratorium on repayment of loans was also put in place. But Pahwa’s fear points out that the plight is far from over. “Banks can do much better in showing their respect for the MSME segment, from the current feeling of ‘affirmative ac- tion’—both in terms of proactive product development for the sector as well as customer service,” says Mumbai-based indepen- dent market commentator Srinath Sridharan. The Budget attempts to boost the lot of MSMEs in a creditable way. It has doubled the support to the MSME sector from last year’s budgeted estimates by setting aside Rs 157 billion for the next financial year. One may point out the fact that the Govern- ment spent only three-fourths of its 2020-2021 budgeted target of Rs 75.72 billion in the ongoing financial year and hence was compelled to set aside a higher amount for the next. Be that as it may, a doubling of the figure is creditable. The Government, under its ‘Atmanirbhar Bharat Abhiyan’ (self-reliant India programme) launched last year when the pandemic raged, also redefined the parameters to determine an MSME. The idea was to help them grow and compete at a bigger scale. Only domestic firms are now allowed to compete The Budget’s new in state tenders worth framework could up to Rs 2 billion to sup- be a gamechanger port the Government’s for both MSMEs and ‘Make-in-India’ initia- non-banking financial tive to augment domestic production. corporations as According to the new their lives are often definitions, MSMEs intertwined—more A Song for the Unsung with an investment of and healthier In doubling the allocation for MSMES, the Budget has recognised Rs 10 million and an- MSMEs means more their potential in creating employment and boosting growth nual turnover of Rs 50 million will be called business for NBFCs micro-units. Units with an investment of Rs 100 million and annual turnover of Rs 500 million will be termed dressing their concerns—access to cheap capital, labour and small units while those with an investment of Rs 500 million and raw materials and affordable power. This, when MSMEs con- annual turnover of Rs 2.50 billion will be classified as medium tribute about 30 per cent of the country’s GDP and 40 per cent units. Exports form part of the turnover limit. of exports while employing 110 million people, about a quarter When it comes to improving the financials, Sitharaman’s of the country’s workforce. Budget takes a step forward. In line with its objective to bring MSMEs began to be noticed only in the 2000s when many about discipline on the part of various stakeholders—taxpay- credited them for China’s emergence on the world economic ers, corporates and lenders—the Budget proposes to set up al- map. But stories like Pahwa’s still abound in India where the ternative methods of debt resolution and a special framework ground-level reality can be very different from what the noise for MSMEs. tells you. Sitharaman’s Budget does attempt to alleviate their The new framework could be a gamechanger for both sufferings but they remain the unsung, if not the abused, lot. MSMEs and NBFCs as their lives are often intertwined—more At the peak of the pandemic and what could be construed as a and healthier MSMEs means more business for NBFCs. MSMEs, welcome break from the past, the Reserve Bank of India (RBI) and sometimes for little blame of their own, find themselves in a
15 february 2021 www.openthemagazine.com 59 Openomics 2021 MSME
Rama Bijapurkar sticky spot with banks and then find it hard to secure loans, as highlighted by Pahwa. NBFCs with a minimum asset size of Rs 1 billion will now be able recover their loans with greater ease from defaulters, many of whom are MSMEs. Minimum loan size eligible for debt recovery under the Securitisation and Reconstruction of B e c aus e Small Is Big Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) is proposed to be more than halved to Rs 2 mil- lion for NBFCs from Rs 5 million. This will help NBFCs chase he good news is that in recent fly-by-night operators and help clean up the system. times, the MSME sector is getting as “This is an effective step towards ushering credit discipline much serious policy attention in India’s and in the long-term will increase the penetration of credit to economic discourse as big business. The small businesses,” says Shachindra Nath, executive chairman bad news is that so far there is more and managing director of U GRO Capital, a BSE-listed small talk than walk, and where walk is con- business lending fintech platform. cerned, more of the same palliative ac- But the problems are deeper. Nitin Jain, a garments manu- tions rather than a clear strategy based facturer and trader based in the wholesale market of Delhi’s T on a fresh look to build India’s MSME Gandhinagar, laments that Goods and Services Tax (GST) re- Version 2.0 over the next 10 years. A CRISIL report headline says funds take long and often don’t come, mired in bureaucracy. that they are facing an ‘existential’ crisis. Existential crises don’t Jain laments that the GSTN website, the platform for filing get solved from a place of ‘what is and why it is so’ but from a returns and all matters related to GST, is down every time the place of ‘what can be and how to make it so’. due date for GST return filing is near. “We are then forced to file While large companies have emerged from 2020 battered later with a penalty,” he says. The GST framework has been in but getting to live another day and several have managed to im- operation for more than three years. These can no longer be prove operating margins and ride the come-back of demand, called teething problems. The malaise is deeper. MSMEs have mostly not had the resilience to do so. Several are “The entire process has gone physical against the automated near-dead from working capital asphyxiation and unable to system that was intended. Several documents are asked for recapture the demand they once had, presumably because they physical verification,” says Pahwa, adding that the cut in im- competed on cost and had no differentiation. Even if you offered ports duties on steel, as announced by the Budget, would do loans aplenty, many of them are not in a position to qualify for little to repair the plumbing issues. them or digest them. Ask him why, he says competition is stiff. “Clients refuse to The obvious question is why struggle so much to try and stop accept any hike. The moment you ask for an increase, they tell MSMEs from dying? Why oxygenate their entire planet to help you to send the quote and the next moment, they have another the strong and weak breathe instead of allowing the fittest to vendor ready to offer their product at the same rates”. Believe it survive? After all, that’s market capitalism and it is jungle fires or not, he says his prices have remained the same for clients for (admittedly, not man-made ones) that keep the jungle healthy the last eight to 10 years. as a whole. It’s the woes of such MSME owners that are still to be The answer always comes in the form of how big their con- addressed. tribution to employment is. Ninety-nine per cent of all MSMEs Sridharan has a solution. “One of the thrust areas which are micro and half are in rural India and half in urban and spread could help MSMEs is digital payments. That could bring in ease all over, geographically. Add to it the dismal occupation and ed- of getting payments on time as well as with their compliances. ucation profile of India’s young generation and it is clear that This would also enable further and cheaper credit access with without them, India’s ‘let’s pretend’ demographic dividend will better visibility of their financials,” says Sridharan. be in a far worse place. All evidence from around the world, and The Budget, in doubling the allocation for MSMEs, recognis- our own experience in India, shows that large companies are es their potential in creating employment and boosting growth. increasingly using more technology and fewer people to get Steps like the re-definition and a new dispute resolution the job done. If we have some hope of upward mobility and up- mechanism are good too. But the road to salvation for MSMEs skilling large numbers of people over the next decade, we need is long, and still challenged by the bureaucracy. High cost of MSMEs to be healthy. capital, stiff compliance and unskilled labour are just some So yes, we need to oxygenate ‘planet micro enterprises’ for others. Unless those are addressed, MSMEs will continue to be their survival and ours. There are many ways to oxygenate this seen as one with the begging bowl. That’s not planet. There is an old favourite, tried and tested way of cluster- a pleasant sight. n ing them geographically and oxygenating them through shared services, both government-subsidised and via service providers Dhirendra Tripathi is a Delhi-based journalist who are happy to do price-cost of customer acquisition (so many
60 15 february 2021 There are many Ways to B e c aus e Small Is Big oxygenate micro enterprises
in one place) trade-offs. We need to create many more clusters. ductive and old school. We have to do the opposite. We have If the objective is to preserve employment, then for all nudged more and more MSMEs into the GST and IT returns income-tax filing SMEs above Rs 1 crore turnover, audited ac- ambit. Let’s build on these gains and make it easier for them to counts are available and employee wage costs are available, and stay there. ‘Declutter-digitise-simplify’ to make all compliances some part of those can be defrayed in a manner that makes it as easier, incentivising more and more MSMEs to come in, today scam-proof as possible. People have dismissed this as ‘you don’t reeling or daunted by costs and complexity of doing so. So if we know how jugaadu and corrupt MSMEs are.’ True perhaps, but widen their digital footprint, we have better data and we can very unfair to single them out. Big business has scammed us as oxygenate them better. badly, or worse. We are a corrupt society. But what naysayers Another way to oxygenate them is to find segmented solu- need to notice is that in today’s India, with its digital infrastruc- tions, one size doesn’t fit all. The trouble with mega-label policy ture and footprint, it is getting harder to jugaad. is that it doesn’t really work at the micro sector ‘x’ size, ‘x’ type Raising the limit of auditing for tax filing is counterpro- of business level. In fact, this should be the basis for setting up industry associations so that we can be more granular about prob- lems and solution space discov- ery and dialogue. Too complex? Sadly, our wonderful macro, as has been so often pointed out, is the meta of so many really tiny micros. If only the glossy reports of consultants which talk about what MSMEs need to do to im- prove product differentiation, upskilling, improving technol- ogy, etcetera, can dedicate as
While large companies have emerged from 2020 battered but getting to live another day and several have managed to improve operating margins and ride the comeback of demand, MSMEs have mostly not had the resilience to do so
Illustration by Saurabh Singh
15 february 2021 www.openthemagazine.com 61 Openomics 2021 MSME
much time to the task of what all it takes teeth on branch banking in the 1960s to truly create a vibrant ecosystem. Once and 1970s and moved into senior po- this happens, differentiation, going up Raising the limit of sitions prior to retiring. the value chain, etcetera, will auto- auditing for tax filing is One of them recalls how the State matically happen. Greed and youth are counterproductive. We Bank of India (SBI) had created a spe- deadly seekers of opportunity. I have of- cial cadre of staff drawn from within ten written about the splendid business have to do the opposite. the banking system called develop- instincts of the micro entrepreneurs best We have nudged more and ment officers, posted in Kolhapur, exemplified as ‘tea with sugar Rs 5, with- more MSMEs into the GST Sangli, Guntur and so on and, of out Rs 8’ or how all small tailors learn the and IT returns ambit. Let’s course, in branches near industrial latest fashion real-time with their hitting build on these gains and states with a mandate to develop big stores, or the footwear exporter who and guide MSMEs, and even in those says ‘yes, I can make the design’, bags the make it easier for them days, they did cash flow-based lend- order and figures out how to make it. to stay there. ‘Declutter- ing. He remembers one such SME Interestingly, we have a caste system digitise-simplify’ to branch he was in, as a branch man- already—startups are not MSMEs in our make all compliances ager—he said it was the Andheri minds. So no, let’s not waste energy on branch where he did Rs 19 crore in them—let’s just not fix what ain’t broke. easier, incentivising more advances (1968-1969) profitably. This Government has itchy fingers and MSMEs to come in Development officer jobs were meddles a lot. field, not desk, jobs and branches actually did banking, and were not the dumb terminals of today’s cen- ow the big question—how do we enable access tralised banking system. He said they would sit with borrow- to funds? The common complaint for the longest time ers and help them with their applications, showing them what N has been that the MSME books are dodgy. Incentivising financial planning was. He adds ruefully, “Today, CBI would have good practices through lowering the administration burden and come and arrested me for collusion.” the cost of doing so is the only way. Many are today willing to A dedicated force for SMEs were the warriors, field officers comply—the upside of being legit is far more interesting today. who were up on their game. Field officers would validate things The changed societal aspirations we have identified as causing like upward revision of electricity bills, wage bills, raw mate- voter behaviour shift, the need to change the status quo for a rial purchase bills or a request for additional credit. The branch ‘shot at a better life’, also applies to micro owner-driven enter- manager would review everyday vouchers of all account holders prises with ideas and aspirations. So, it’s back to the elephant (think how easy that would be in today’s world of AI and algo- in the room—Primary Sector Lending (PSL) hasn’t worked too rithms!) and see who is an MSME borrower paying and who is well and the jury is still out on the Micro Units Development and he receiving from. Refinance Agency (MUDRA), but we are hopeful. Today, it’s not fashionable to see banking as a social institu- Let’s segment another way. The ones who are part of a ven- tion. But there is a new emergent business narrative which says dor/distributor ecosystem are okay. If banks won’t lend to them, social purpose is as important as shareholder returns. In fact, fintechs will do so gladly. Then there’s new-age non-banking the two are linked. financial companies (NBFCs) who will build linkages to other Rosabeth Moss Kanter of Harvard University compellingly businesses of theirs and lend selectively to another set of MSMEs. describes a concept called institutional logic and says companies These are engines that are being built and we need to fuel them ‘are more than instruments of making money, they are vehicles by increasing the pool from which they can draw. for accomplishing societal purpose.’ It is fashionable to vilify the public sector banking system, We need a cultural change to fix this MSME thing. Today, all but there is so much to learn and keep from there. Private lega- the tools are there like never before. We need the MSMEs—for ex- cy banks are not interested. They still talk of old-world ideas of ports, employment, global outsourced manufacturing activities. ‘no collateral’, ‘bad books’, and generally, ‘it’s not my problem Let’s look back to the future on several counts. Asian Paints, to fix the system’. This is called business development. The Nirma, Haldiram, Haldyn Glass were small once. Let’s strategise old India Inc hasn’t been surviving too well. There are enough and execute our way through this and build a vibrant healthy instances of small, tiny companies becoming significant, the MSME ecosystem. For the first time, many new pieces are law of speedy compounding which banks get quite well. The available and in shape. It will come together. n lazy idea seems to be to bring efficiency to non-performing assets (NPAs) also. One Rs 4,000 crore NPA is more efficient than Rama Bijapurkar is a market strategy consultant 4,000 NPAs worth a crore each! and the author of A Never-Before World: Tracking the I reached out to very eminent PSU bankers who had cut their Evolution of Consumer India. Views are personal
62 15 february 2021 Statement of Shri CH S. S. Avenues Mallikarjuna Rao, MD & CEO, Punjab National Bank for Union Budget 2021-22
e welcome the measures strengthen the sector are as under: and e-Courts will be adopted and alternate announced by Hon’ble Finance • Various measures have been announced mechanism of debt resolution will be set up. W Minister in Union Budget 2021- on the infrastructure front, which are •The massive program for monetization 22. The budget rightly strikes a reasonable expected to take the economy into a new of completed/ running projects will help balance between addressing the key trajectory of growth. In addition to over in creating required resources through the pillars of Health & Well-being, Inclusive a 34% increase in capital expenditure, instruments like INVITs. Development, Human Capital, Innovation new highway projects have also been • Other important announcements of and R&D, apart from laying the path for announced. bringing in the IPO of LIC, hiking the FDI a robust economy by providing a major • Setting up of a professionally managed limit in insurance increase to 74% from infrastructure boost. The array of measures Development Financial Institution will 49%, strategically divest 2 Public Sector announced are in line with people as well as catalyze infrastructure funding. Banks and 1 general insurance company, market expectations and will go a long way • Creation of an ARC and Asset are steps in the right direction. to bring the nation back on track by boosting Management Company that will take over The voluntary scrapping policy proposed spending on infrastructure and rural the stressed assets and sell to Alternative for discarding old commercial vehicles will development while fighting the pandemic Investment Funds (AIFs), is also welcome boost the automobile industry. The gross through health focused measures. as it will help improve the health of the borrowing programme is also helpful to As far as the financial sector is concerned, banking sector through impact on price maintain the fiscal health of the economy, further recapitalization of Rs 20,000 crore for discovery and improving competition in while providing necessary funding PSBs in the FY 2021-22 is a welcome step. the market. towards growth and development of the The other measures which are expected to • The NCLT system will be strengthened infrastructure.<
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Coming Soon.. Follow us on openthemagazine openthemag openavenues Openomics 2021 Health Out of the pan demic Putting healthcare centrestage is the first step In overhauling the system
hen Finance Minister Nirmala Sitharaman stood up in Parliament at 11AM on February 1st and began her Budget speech by declaring health and wellness to be one of its central pillars, no one was W surprised. If not during the pandemic, then when? Sitharaman claimed a 137 per cent increase in allocations on health, a jump that had the potential to take India’s health budget closer to the aim of 2.5 per cent of GDP but as she wrapped up her Budget speech an hour and a half later, it was clear that the fine print had a different story to tell. Last fiscal, the health ministry was allocated Rs 67,112 crore though revised estimates were considerably higher. This year, the ministry has been allotted upwards of Rs 73,000 crore, a jump from last year’s figures but still lower than the revised estimates. The extras that make up the 137 per cent are Rs 35,000 crore for the vaccination drive underway and funds for sectors such as drinking water and sanitation, linked to health but not typically included under health. A new scheme, Pradhan Mantri AtmaNirbhar Swasth Bharat Yojana, has been launched with an outlay of Rs 64,180 crore for the next six years with an aim to build health infrastructure, such as critical care hospital blocks and public health labs. Health and wellness, “pillars” for this year’s Budget, are held up by other pillars such as equitable, affordable and accountable healthcare accessible to all citizens. And in India, all these under- lying pillars still remain shaky. According to Economic Survey 2020-21, on quality and access of healthcare, India is ranked 145 out of 180 countries. ‘Only few sub-Saharan countries, some pacific [sic] islands, Nepal and Pakistan were ranked below India,’ says the report. The survey goes on to recommend that the focus
has to be on building the healthcare system rather than merely reuters on communicable diseases, ‘as the next healthcare crisis could possibly be drastically different from Covid-19’. For public health expert Dr Chandrakant Lahariya, the One of the objectives as envisaged by the National Health Policy 2021-2022 Budget is a well-articulated document but there are of 2017 is an increase in health spending to 2.5-3 per cent of GDP. more than a few quibbles. The money earmarked for vaccine Currently it stands at around 1.5 per cent. “If we are looking at allotment, for instance, is a good development, he says, “but 2.5 per cent of GDP, then the trajectory of spending should have how will vaccine delivery strengthen the system?” What the been far higher,” says Lahariya though he is hopeful that at least Budget needed, according to him, was commitment to schemes some aspect of the healthcare system will get strengthened. in terms of financing that become a “line item in years to come”. Some experts are feeling let down, not in terms of policies
64 15 february 2021 Out of the pan demic Putting healthcare centrestage is the first step In overhauling the system By Nikita doval
Yojana was launched but its allocation has remained unchanged year-on-year at Rs 6,400 crore. More than Rs 35,000 crore has been earmarked for the National Health Mis- sion which focuses on primary health- care, but again the allocations have only increased at a compounded rate of 4 per cent between 2017-2018 and 2021-2022. “Over the last five years we have been hearing the right kind of noises coming from the powers that be as far as health is concerned. Government documents mince no words when it comes to our healthcare system but very little is be- ing done about it. This year, because of the pandemic, we had an opportunity to overhaul the system entirely but what we have got are tweaks,” says Oommen C Kurian, head of health initiative at Delhi-based think-tank ORF. It was the public healthcare system that stepped up when we really needed it, says Kurian talking about the pandemic, and to strengthen that, reforms have to come from the ground up. This means a focus on capital expenditure, infrastructure building and investment in human re- sources. “Even now frontline workers are torn between the vaccination drive Medical workers and regular duties. There is an urgent tending to a need to address the deficit of staff.” In- Covid-19 patient at Lok Nayak Jai vestments in terms of basic infrastruc- Prakash Hospital ture at the block and district levels is a in New Delhi, July 17, 2020 crucial piece to the overhauling of the primary healthcare system, our first defence against any disease. The newly launched Pradhan Mantri AtmaNirbhar but funds allocated. Health directly affects the economic growth Swasth Bharat Yojana, with an outlay of Rs 64,180 crore for the potential of a country with increased life expectancy alone rais- next six years, does aim to address this concern as one of its goals ing GDP growth rate by over 1 per cent. Out of pocket health ex- seems to be the development of primary, secondary and tertiary penditures (OOPE) push 7 per cent of Indian families below the healthcare. The longstanding demand for the regularisation poverty line, according to a 2016 paper by US think-tank Brook- and increase in salaries for frontline workers, such as accredited ings. India has one of the highest levels of OOPE in the world. It social health activists (ASHAs), who have been at the forefront was precisely to tackle this that the Pradhan Mantri Jan Arogya in the pandemic remains unaddressed.
15 february 2021 www.openthemagazine.com 65 Openomics 2021 Health
K Srinath Reddy However, a key thing to keep in mind is that public health in India is a state subject. The policies and programmes may flow from theC entre but it is up to the state governments to ensure that these are implemented. States such as Arunachal Pradesh, Goa and Kerala spend much more than the national average when it comes to public healthcare, while states such Synergy at Last as Bihar, Uttar Pradesh and Jharkhand are among the lowest. “Good policymaking requires sufficient funding but even the funding has two aspects: allocation and utilisation. States need he role of the Ministry of Health to spend 8 per cent of their budgets on healthcare but we are still and Family Welfare has over many near the 4.5-5 per cent mark,” says Lahariya. years been seen as providing a mix of The healthcare aspect of the 2021-2022 Budget had an op- some preventive and many clinical portunity to be truly dynamic but, experts say, it only meets care services. Many critics suggested the bare minimum, especially in the wake of the pandemic. that it should be renamed the Depart- That too is welcome, of course. Economist Shamika Ravi says, ment of Illness Care, since health “Increased allocation raises long-term productivity. Even access was not promoted as a positive at- tribute. The problem lay in the fact T that many of the social, economic, environmental and commercial determinants of health lay in the policy and programme remit of other ministries. Their al- locations were never counted under the budget head of health. The health ministry’s budget itself stagnated around a very low level of public financing, inadequate for delivering the needed health services with efficiency and equity. As India’s public ex- penditure on health, Centre and states combined, remained around 1 per cent of GDP for several decades, the perennially disappointing health budgets drew constant criticism for low ambition and allocation. Finance Minister Nirmala Sitharaman decided to buck the trend this year with the remarkably adroit move of creating a Government health and wellbeing budgetary head, combining the alloca- officials consecrate a tion for the health systems, water and sanitation, nutrition and Covid-19 vaccine reduction of air pollution. This not only enabled her to project a consignment in Mumbai, holistic vision of health (with preventive, curative and promo- getty images January 15 tive services) but also claim an increase of 137 per cent in the health budget. Even though the health ministry’s overall bud- to clean water substantially improves healthcare but the Bud- get rose only by 11 per cent, the complementarity provided by get also needs to establish health as an engine of growth.” Ravi higher allocations to other health-friendly programmes made argues that with rich countries ageing and the demographic this combination a strategic move. divide on India’s side, there is an emerging healthcare demand Water and sanitation, essential for protecting health, saw a that India can cater to but first we have to set our own house in threefold increase in allocation. Nutrition programmes, which order. “From research and development to HR, to governance, faced serious challenges due to Covid-19 lockdown and restrict- the pandemic could have been for India’s healthcare industry ed mobility, had difficulty in delivering the benefits at angan- what Y2K was for our IT industry: a chance to pivot, but this wadi centres and schools. Heads under which funds remained hasn’t come into focus. We have to see health through the lens untapped saw a reduced allocation this year, though it would of growth and not just a social vision,” she says have been preferable to maintain the thrust on combating Health in India remains as much a matter of fund allocation childhood undernutrition through home delivery. Merger of as governance and the pandemic has shown that for the coun- pre-existing nutrition programmes has seen the birth of Poshan try to be truly prepared, these have to go hand-in-hand. “The 2.0 in the Budget. With budgetary support for reducing air pollu- pandemic was the perfect opportunity for the government to go tion and improving urban public transport systems, the Budget all out but we have let it go. The level of change that the Indian signals support for a health-promoting environment. healthcare system needs can come only through substantial The allocation to the health ministry’s programmes has been funding and bureaucratic will, [with] both the Centre and state below expectations. The National Health Mission saw a rise of working to their full capacity,” says Kurian. n 9.6 per cent, though the need to energise rural comprehensive
66 15 february 2021 the holistic budget combines health systems, Synergy at Last water, sanitation, nutrition and air pollution
primary healthcare and awaken the slumbering urban health of Rs 35,000 crore for vaccines and a new Centrally sponsored mission demands more resources. Allocation for the Pradhan scheme to ramp up capacity for epidemic surveillance and con- Mantri Jan Arogya Yojana (PMJAY) stayed at last year’s level, trol. The Pradhan Mantri AtmaNirbhar Swasth Bharat Yojana, since fund utilisation was low in the Covid-19 period as non- operational over six years with a budget of Rs 64,180 crore, will Covid care and claims fell sharply in hospitals. The Indian strengthen disease surveillance at block, district and metropoli- Council of Medical Research and Ministry of Ayurveda, Yoga & tan levels and tighten screening at all monitored international Naturopathy, Unani, Siddha and Homoeopathy (AYUSH) fared entry points (air, sea and land). Public health labs in all districts better with larger allocations. and 3,382 block public health units in 11 states will strengthen The Covid-19 response featured strongly, through allocation pathogen and disease monitoring, while critical care units in 602 districts and 12 Central institutes will enable efficient case management. The National Centre for Disease Control and its five regional branches will be strengthened. A national institution will be established for One Health surveillance which tracks microbial migration from wildlife to veteri- Earlier, many of the nary and human populations. Further, nine biosafety level 3 laboratories would be set up, along with four regional social, economic, institutes of virology. environmental and In a happy coincidence for health, the recommendations commercial determinants of the 15th Finance Commission also arrived to provide of health lay in the policy guidance and money for strengthening public healthcare systems at Central and state levels. The commission recom- and programme remit of mended upgrading of both rural and urban primary health- other ministries. Their care, providing resources (unconditional grants of Rs 70,051 allocations were never crore through local bodies and Rs 4,800 crore through state- counted under the budget specific grants). It allocated Rs 15,265 crore for critical care head of health hospitals. The commission, whose recommendations on Centre-state division of tax revenues apply for the next five years, asked the states to raise the share of health in their annual budgets to at least 8 per cent by 2022. The commission asked for stronger regulation of the private sector and recommended the creation of an All India Medical and Health Service. It called for greater attention to non-communicable diseases and core public health functions such as disease surveillance. The confluent impact of the health and wellness budget and the direction provided by the Finance Commission’s report create a path forward for strengthening the public health system. It enables decentralised local governance of health, provides the impetus for our journey towards a primary care-led universal health coverage and catalyses concerted action on the many determinants of health which lie outside the remit of the health ministry. n
K Srinath Reddy, a cardiologist and epidemiologist, is President, Public Health Foundation of India. He is the author of Make Health Illustration by Saurabh Singh in India: Reaching a Billion Plus. Views are personal
15 february 2021 www.openthemagazine.com 67 Openomics 2021 Personal Finance I
Investing in Trust While the Budget seeks to ease last year’s pain, it wants companies and individuals to discipline themselves too By Dhirendra Tripathi Saurabh Singh Saurabh by Illustration
68 15 february 2021 magine transferring an assessee. In addition, hearing only through video conferencing ‘x’ amount of rupees from your will make the assessment exercise under IT to be fair and open,” ICICI Bank to your own State Bank says Rashmi Deshpande, partner at law firm Khaitan & Co. of India account and seeing the tax Reining in mis-selling of financial products seems to be high officer count it twice in your income. on Sitharaman’s agenda as she announced one more step to ad- Unbelievable? PD Thomas, a practis- dress the plight of investors. The Government will now set up an ing chartered accountant based in investment charter for all products across the financial sector. If Delhi, has a story to tell about one of words are put into action, the grievance resolution mechanism his clients having gone through this for investors across asset classes is set to get strengthened. ordeal. After years of tax assessment Sitharaman has provided some succour to senior citizens going faceless, it is these incidents too, aged 75 years and above, a recognition of their health needs that make you wonder if many of and hardship. They will no longer have to file their returns if those efforts by the Government the income is only from pension and interest and the tax on the I really come to anything. same has been deducted by the bank. “The officers are under pressure to achieve their targets to The Government has also expanded the scope of pre-filed get revenues for the Government. There was no concealment of tax return forms which will now include details of capital gains income and yet a sum of Rs 57 lakh was added to income which and interests from banks and post offices. Pre-filled forms help were mere cross entries between different bank accounts and taxpayers file their returns a demand of Rs 37 lakh was raised without any basis,” says smoothly and quickly. Thomas, indignant at the display of high-handedness by tax But the finance minister officials even as he goes on to praise the efficiency of appellate hasn’t just addressed investor authorities and tribunals. plight. While Sitharaman has The Budget is an The officers also give very little time to reply to the notices striven hard to improve com- attempt at taking they send, says another chartered accountant on condition pliance and take out the anxi- of anonymity. ety, she also expects citizens the fear of tax One can assume there will be many more such cases. Finance to be more disciplined and terrorism out of Minister Nirmala Sitharaman’s February 1st Budget (for April informed in their duties and the tax payment 2021 to March 2022) is an attempt at taking this very fear out responsibilities. To treat the exercise. The idea of the entire tax payment exercise. The idea is to go faceless for incorrigibles, she takes away more and more steps in the entire process, from payment and the loopholes. is to go faceless scrutiny to adjudication. The Budget also deftly tack- for more and more The Budget proposes to constitute a Dispute Resolution les a constituency that easily steps, from Committee for small taxpayers, which will be faceless to ensure creates a brouhaha. So, after payment and efficiency, transparency and accountability. Anyone with a tax- all the talk of rich tax, wealth scrutiny to able income up to Rs 50 lakh and disputed income up to Rs 10 tax and what have you that cir- lakh can approach the committee. The Income Tax Appellate culated before the Budget, the adjudication Tribunal, the next level of appeal in income tax cases, will also finance minister has played it go faceless. a little smart instead of going When it comes to tax payment, it’s not over till it’s over as in for a blanket exercise that the file, even in simple cases, could be opened any time in six can be counterproductive. Call them rich or well-off or high years from the end of the relevant assessment year. That limit networth individuals, she has decided to tax them a little more. has now been halved to three years. Re-opening up to 10 years It’s a constituency usually supportive of the ruling Bharatiya will happen only if there is evidence of undisclosed income of Janata Party (BJP) but the finance minister felt it was worth tak- Rs 50 lakh or more in a year. Discretion in reopening of cases ing that risk. has been dispensed with and will be done only if a case has been Interest earned on more than a Rs 2.5-lakh contribution in flagged by the system on the basis of data analytics, objection by a year to an Employee Provident Fund or Voluntary Provident the Comptroller and Auditor General in such cases. Fund (EPF/VPF) will now be taxed. So far, there was no limit and “It will go a long way in bringing down tax terrorism. Tax of- no tax. This is a big development as so far all PF contributions ficials will have to prove to the satisfaction of the Principal Com- were EEE, that is, they enjoyed an exempt-exempt-exempt status missioner of Income tax there has been a serious case of conceal- and were a popular source of savings, given that they provide ment and they need to go back 10 years in case of the specified a guaranteed return in excess of 8 per cent. There are very few
15 february 2021 www.openthemagazine.com 69 Openomics 2021 Personal Finance
EEE instruments in India and this was one of them. Now the ment and hardship faced by depositors in the wake of the crises middle ‘E’ is gone even as the contribution and its withdrawal at Yes Bank and Punjab and Maharashtra Co-operative Bank remain exempted. (PMC), relates to deposit insurance. Employee and employer contribution is as such capped at Last year, the Government had approved an increase in the 12 per cent of the basic salary but the lure of over 8 per cent guar- deposit insurance cover to Rs 5 lakh from Rs 1 lakh for bank anteed return has many employees contributing in excess of it. customers. But this expanded window is available only when This created a loophole for high salary earners to earn a tax-free a bank goes into liquidation. The Government will now enable interest. In the good old days, this rate used to be in excess of a framework whereby customers of a bank, which is temporar- 9 per cent. The cap will be applicable for contributions made ily unable to fulfil its obligations, will still be able to get easy and from the next financial year, starting in April. timebound access to their deposit cover of Rs 5 lakh. On the face of it, the move goes against small savers. But then, The Rs 1.5 lakh extra rebate on interest paid for affordable only high salary earners are impacted. The tax will be as per the housing loan, beyond the Rs 2 lakh limit popular with all those slab the person is in. looking to buy a house, will be available for another year. The For long, how much tax one will have to pay on a certain prod- additional deduction will be available for affordable housing uct has decided the choice of the instrument and not its inherent loans taken up till March 31st of 2022. strengths. This has obviously led to a lot of wrongful market- ing (or mis-selling as it’s popularly called) of prod- here was more positive news for the stakeholders ucts and schemes, duped of the real estate industry. In order to incentivise home The finance savers of their money and T buyers and real estate developers, the safe harbour limit minister has created distrust among will be doubled on specified primary sale of residential units to end-consumers, compa- 20 per cent. This means select properties can be registered at a introduced a nies and agents. price up to 20 per cent lower than the circle rate. This would be of taxation element Next comes the unit- particular help to stranded buyers of properties under construc- in both Provident linked insurance plan tion for the last many years. Fund and unit- (ULIP), a product that has The Government has recognised the negative outcome of linked insurance long been mis-sold year raising customs duty on gold last year. This not only raised the after year. The finance prices of the yellow metal in the market but also arguably led plans for high minister has now brought to more smuggling. It has cut basic customs duty on the pre- income earners. its taxation at par with cious metal to 7.5 per cent from 12 per cent. While there will be a Hopefully, this that of mutual funds by re- 2.5 per cent agriculture infrastructure and development cess on will end mis-selling moving the tax arbitrage gold, there will be no 10 per cent social welfare charge that the between the two. A ULIP agriculture cess on other goods will attract. in ULIPs and bought henceforth and India is the largest importer of gold and usually imports help the consumer carrying an annual premi- 800-900 kg of the yellow metal every year. The country’s imports decide on the um of over Rs 2.5 lakh will of the metal declined 47.42 per cent from a year ago to $9.28 product’s inherent now attract long-term cap- billion during April-October 2020 as the Covid-19 pandemic merits ital gains at maturity or dampened demand. redemption. The amount While the fall in imports helps narrow the trade deficit, a high received on death will duty regime has often backfired with a rise in smuggling. remain exempted with- The steps point to a Government keen on building trust out any limit on the annual premium and customers cannot with citizens and also having citizens trust each other, where escape the provision by buying multiple policies. the privilege of one does not allow her to benefit or the lack of The finance minister has thus introduced a taxation element knowledge puts the other at a disadvantage. It also calls upon in both PF and ULIP for high income earners. Hopefully, this both corporates and individuals to discipline themselves—for will end mis-selling in ULIPs and help the consumer decide on example, through the ULIP tax rule change. the product’s inherent merits. It also recognises the pain the common man has gone “ULIPs will lose the associated tax benefits and may become through in the last year as a result of the pandemic. The ex- less attractive for investors planning to invest over Rs2.5 lakh tension of interest rebate on affordable housing echoes that. per year. Therefore, investors may now strongly consider sepa- It also aims to tap into people’s savings to fund the country’s rating investment from insurance needs in order to get better infrastructure. Save right and spend seems benefits from either,” says Adhil Shetty, chief executive officer to be the Budget’s gist. n of BankBazaar. A key step announced, coming in the aftermath of the harass- Dhirendra Tripathi is a Delhi-based journalist
70 15 february 2021 While Inside Look Outside For FREE With access visit www.openthemagazine.com Openomics 2021 StartUpS
Rameesh Kailasam
Go the Distance More regulatory reforms instead of stimulus packages please
s Finance Minister Nirmala of reforms that would grant startups regulatory relief, ease of Sitharaman rightly remarked, “The doing business, reduction in compliances and easier access to preparation of this Budget was under- primary markets. Startups are central to the India success story taken in circumstances like never before. and have significantly triggered employment generation and We knew of calamities that have affected are a major source for attracting foreign direct investment (FDI). a country or a region within a country, Through Budget 2021, the Government has showcased a positive but what we have endured with Co- intent that is evidently desirous of promoting startups and uni- A vid-19 through 2020 is sui generis.” corns across sectors which have induced economic dynamism The finance minister presented the Union Budget 2021 in by injecting innovation and spurring investment and resulted the midst of high expectations, with the nation having endured in multiple levels of impact—most of which has been crucial the pandemic unitedly so far. Considering that the 2020 Budget did not bring the much needed cheer and was followed by the lockdown, all stakeholders including the Government were working with their backs to the wall. The economy which was already witnessing a lower growth was severely hit by the pandemic that ensured a deflated first half of financial year 2020-2021. The pandemic also tested the resilience of this coun- try, its people, businesses and also its startups. Amid the gloom emerged many stories of glory and signs of fresh shoots that ensured the fighting spirit was still alive and we became a more digital and connected economy. While India’s ambitious growth aspirations at becoming a $5 trillion economy had to temporarily go into a pause mode, the target is still doable if all sectors today perform, backed by a quantum leap by leveraging our startup story. Prime Minister Narendra Modi, during his address at ‘Prarambh’, the Start-up India International Summit in January, had said that “this is the century of the digital revolution and a new-age innovation”. He had further remarked: “This century is also called the century of Asia. Therefore, it is the need of the hour that the technologies of the future come out of the labs of Asia and the future entrepre- neurs should be prepared from our lands”. This statesman-like focus on the future certainly encourages and benefits startups and innovative technology-based business models while unleashing the entrepreneurial spirit among the youth. The startups of today are well positioned to take India to- wards innovation, ease of living, economic growth and a connect- ed economy. Such initiatives and direction have also prompted a significant shift in thinking from a nation of job seekers to one of job creators, with ambitions to take on the world. Budget 2021 had several expectations of unleashing a slew Illustration by Saurabh Singh
72 15 february 2021 to the idea of an Atmanirbhar Bharat. Ear- creation in India. The Government has lier budget announcements, such as a TV been working on a framework that would channel/programme for start-ups similar Budget 2021 has permit companies to list on foreign stock to the famous Shark Tank, have to take off. showcased the exchanges without prior or simultaneous Startups and unicorns have been stra- listing in India. It has also introduced the tegically looking at three major factors to intent to promote Innovators Growth Platform (IGP) for make it big at a global level. This can be startups and high growth technology companies that essentially attained by: first, introducing unicorns in sectors function on asset light models. It is abso- ways and means to create wealth in India; that have induced lutely necessary that a holistic enable- second, reducing/relaxing compliances economic dynamism ment is granted to startups to be able to and regulatory requirements to promote list on the Main Board of the Indian stock ease of doing business; and, third, provid- by injecting exchanges as well as overseas. ing for innovative measures to unlock innovation and In addition to this, there are several new business for emerging startups. spurring investment tax-related compliances that need recon- These have a significant bearing on the sideration that include but are not limited story India will tell a few years down to relaxations on double taxation of em- the line, especially considering that it is ployee stock ownership plans (ESOP) as emerging as a huge market for consump- they are critical to attracting talent and a tion and, more importantly, for creation and innovation. motivating factor for startup employees. Other tax provisions The Budget made some noteworthy announcements, such such as 194(O), 206(C) have massively blocked valuable capital as extended tax holidays, capital gain exemptions, formation of for startups and unicorns in sectors such as travel, insurance, One Person Companies (OPCs), with the intent of promoting in- home services and others. Not reconsidering such provisions novation and entrepreneurship in the country. A social security will prove counter-productive to the Government’s vision of code for gig and platform workers promoting digital transactions announced by the finance min- and a fund to promote digital pay- ister. Notable sectors in the startup space, especially around travel ments are other announcements and hospitality, still continue to suffer due to the above sections, lauded by the industry at large. The Goods and Services Tax (GST) duplications and compliance cost clarifications about the equalisation burdens. The tax rates applicable on the salaried classes continue levy will certainly help reduce the to be high leaving little disposable income for investments, in- level playing field issue that many cluding in startups. startups suffered due to the unfair While travel and tourism contributed to almost 10 per cent of advantage that existed with over- India’s GDP, considerable forex earnings and employment, and seas players not domiciled in India. was considered an important sector by the prime minister on That said, while these measures are multiple occasions, this strategic sector that has multiple start- welcome, they do not necessarily ups and self-employed people still has not got its due when it provide solutions to the operational was hit the most; nor were the onerous compliances relaxed. The challenges that currently hurt start- Government also needs to consider introduction of innovative ups and unicorns in the online space, policy measures to unlock sectors and businesses. For instance, a be it travel, hospitality, cab hailing, simple tweak like an expansion in house rent allowance (HRA) textiles, retail, food tech, ed-tech, lo- provisions to permit consideration of rented furniture/white gistics, health-tech space and so on. goods for tax deductions would unlock startups in the renting/ It is a well-known fact that India leasing space. has emerged as the third-largest The finance minister rightly said that corrective measures startup ecosystem in the world and will be taken to smoothen GST and address the anomalies and is now home to 21 unicorns, valued inverted duty structures. The startup sector, by respective indus- at $73 billion. While the Govern- try, is in need of regulatory reliefs more than stimulus packages ment has acknowledged on several and sops. An environment that is compliance-heavy cannot be occasions the economic value these supported through sops, stimulus packages and incentives. It startups and unicorns are capable is time to push the unicorn bandwagon with full force for it to of generating, there is a roadblock become a living reality for India to take pride in and actualise its that these startups and unicorns vision of becoming an atmanirbhar nation. n face while wanting to list on the Main Board of the Indian stock ex- Rameesh Kailasam is CEO, IndiaTech.org, an industry association changes, thereby hindering wealth representing Indian startups and investors
15 february 2021 www.openthemagazine.com 73 Openomics 2021 Centre & States
Manpreet Singh Badal The ABCD of Failure From disease to defence, why this Budget does not work
he Union Budget of 2021 pre- sented by Finance Minister Nirmala Sitharaman fails on the A, B, C and D of Budgets. Here is how. It fails in the areas of Agriculture, Banking, Covid and Defence. Let us examine them one by one. Agriculture virtually saved India T during the pandemic. While factories shuttered and the service sector floundered, the farmer contin- ued to toil. Crops did not fail. They were planted on time, they were irrigated on time, and they were taken care of. The farmer toiled and it was the primary sector that helped us tide over the crisis. The farmer did not fail, and neither did the agricultural marketing and mandi system. But the Union Government failed. Amidst jumlas of doubling farm income, agriculture has re- ceived an increase of only 2 per cent. How does the Government ensure a 100 per cent increase in income with only a 2 per cent increase in expenditure? However, even this 2 per cent increase is not accurate on many counts. The outlay on rural development has been reduced by 34 per cent. Yes, you heard it right. Rural development outlay has been reduced by more than one-third. Agriculture and rural develop- ment are interrelated, and the 2 per cent increase in outlay will eventually be brought down by the 34 per cent decrease in rural development funds. Moreover, the cess imposed in the Budget goes entirely into the Union Government’s kitty, and the states receive nothing from this cess. The Budget also failed the banking sector. One had hoped that due to the financial downturn, the Budget would create avenues for easier access to banking for both agriculture and Small and Medium Enterprises (SMEs). The banking sector required an influx of almost Rs 2 lakh crore. However, the Budget has only provided Rs 20,000 crore to the banking sector, one-tenth of what is needed. How would the SMEs emerge out of recession- ary trends if they do not have access to easier banking facilities? Covid is another area where the Union Budget has failed miserably. One had hoped that the Union Government would be putting a system of pandemic preparedness in place. The ex- perience of a global pandemic has demonstrated that economies of countries that tackled the pandemic well have been the first to rebound. Contrast the US, the UK, France and Italy’s perfor- Illustration by Saurabh Singh
74 15 february 2021 The ABCD of Failure From disease to defence, why this Budget does not work
mance with New Zealand, Vietnam, Taiwan and Thailand, and you can see the difference in eventual results. The fact that India was ranked 86th in the world on the Covid Performance Index does not seem to have bothered the finance minister, who woe- fully ignored addressing the issue. Global connectivity implies that epidemics and pandemics will occur and spread rapidly as compared to previous centuries. One has to look at recent history to realise that our generation has faced multiple epidemics, be it AIDS, SARS, Ebola or Covid. The times will be very challenging and we need robust systems to evaluate, monitor, predict, prevent and thwart the spread of pandemics. The Budget has failed to initi- ate any steps in this direction, and future generations will have to pay for this. The outlay on rural Defence is another sector that re- quires urgent attention, which the development has Union Budget ignores. A mere 1 per cent been reduced. increase has been allocated to defence at Agriculture and a time when the nation is facing greater rural development threats on the eastern, northeastern are interrelated. and northwestern fronts. Is a 1 per cent increase in the defence budget enough The 2 per cent to tackle the combined threats posed by increase in revisionist powers? Has the Union Gov- agriculture will ernment forgotten the heroics of our be brought down soldiers in the Galwan valley? I spoke of A, B, C and D, and I could by the 34 per cent also talk about E, that is, education. decrease in rural Though this sector suffered due to Co- development funds vid, it has received a mere 5 per cent in- crease in allocation. In Punjab, we are seriously confront- ed by all of the above challenges: Agricul- ture, Banking, Covid and Defence. The Union finance minister has failed us on all four counts. The Budget tries to unsuccessfully court another set of A, B and C—which is Assam, Bengal and Chennai that are going to polls this year. However, the electorates of these states are smart. They will not fall for such shoddy stratagems. n
Manpreet Singh Badal is the finance minister of Punjab. Views are personal
15 february 2021 www.openthemagazine.com 75 Openomics 2021 GOA at 60 olÁ Goa AN allocation of Rs 300 crore to mark the 60th anniversary of the state’s liberation from the Portuguese is evidence of its outsized influence
The Church of Immaculate Conception in Panjim, Goa Photograph by Rohit Chawla
By Madhavankutty Pillai
hree hundred crore is a dot in the larger picture of the Union Budget. Normally the allot- ment of such a sum doesn’t find mention given that the total expenditure of the Government is around Rs 30 lakh crore. The amount has been set aside to celebrate the 60th anniversary of Goa’s liberation from the Portuguese. As Nirmala Sitharaman said in her speech: “Goa is celebrat- T ing the diamond jubilee year of the state’s libera- tion from Portuguese rule. From the GoI’s side, I propose a grant of 300 crores to the Government of Goa for the celebrations.” That the finance minister chose to highlight this sum is an indication of how much the state has a foothold in the national consciousness. The Budget is also about political signals and Goa has always been high up on the BJP’s priorities because it was one of the early states it cap- tured power in. However, to put Goa in perspective, take its population size. It is under 20 lakh. That would be akin to a large suburb in Mumbai. Openomics 2021 GOA at 60
Dharavi, Mumbai’s biggest slum, has half of Goa’s population. without abating anything of their pride...’ In size it is one-tenth of Kerala, which itself is counted as one of And still, while their empire whittled away to nothing, Goa the smaller states. Goa has only two members of Parliament— remained a Portuguese colony for half a millennium, until 60 it doesn’t matter to the formation of national governments. Its years ago they were swatted away. The only surprise was that small size or population has not been a factor in the state’s in- the independent Indian government should have negotiated fluence, both in the present and in history. Much of the credit with Portugal for so long. When they decided to take over, it took must to go to its geography, its strategic coastal location that just two days and almost no resistance. But the Portuguese influ- made the Portuguese choose it as their headquarters in this part ence in India still remains on many fronts. Take food. Many of of the world. the things we take for granted as Indian are, in fact, Portuguese When the Portuguese first came to India in 1497 it was Kerala introductions. Like tomato and green chilli, the rajma of the ra- that they tried to get a permanent foothold in. After a period of jma chaval. As an article on livehistoryindia.com says: ‘The most warfare and intrigues with the local kingdoms there, they found significant contribution of the Portuguese has been the variety Goa, conquered first in 1510 from the Bijapur Sultanate, more of fruits and vegetables that they introduced to the Indian land. stable for their colonial Many of the most common fruits and vegetables consumed in ambitions. From here, India today, came with the Portuguese. These include potato, they took control of the tomato, tapioca, groundnuts, corn, papaya, pineapple, guava, spice trade and expanded. avocado, rajma (kidney bean), cashew, chikoo, capsicum and Since the departure By the next century, other even the chilli.’ Then there is the bread that we know as pav. Says of the Portuguese, European powers were the article: ‘According to Lizzie Collingham in her book Curry– displacing them. In Goa A Biography, the Portuguese landed in parts of India where the Goa broke larger into Travel: Being the Accounts locals ate rice. But they missed their crusty bread which they also Indian culture but in of Travellers from the 16th to needed for Holy Communion. They could find wheat flour in an unusual place. A the 21st Century, an anthol- Goa but yeast was hard to come by. So they started using toddy to few decades back, if ogy edited by Manohar ferment the dough and created the pav, which derives its name Shetty, there is an account from the Portuguese pao. Today the pav has transcended the you asked teenagers, by a French merchant, boundaries of Goa to become a much loved and integral part of it was stories of Jean-Baptiste Tavernier, in cuisine across the West coast, riding to fame with all-time favou- Goa’s nude beaches the middle of the 17th cen- rite snacks like vada pav, pav bhaji and kheema pav.’ that fascinated tury, that speaks of this de- them. Even as the cline: ‘The island abounds in corn and rice, and pro- ince the departure of the Portuguese, Goa broke other India reached duces numerous fruits, as larger into Indian culture but in an unusual place. A few out to sensual mangues, ananas, figues S decades back, if you asked teenagers, then it was stories experiences, Goa did d’Adam, and cocos (man- of Goa’s nude beaches that fascinated them. And hippies, par- a retreat for both to goes, pineapples, plantains ties, drugs and all the things that the rest of India turned their meet in the middle and coconuts); but a good nose at in an age of exaggerated morals before consumerism. But pippin is certainly worth even as the other India reached out to sensual experiences post- more than all these fruits. liberalisation, Goa did a retreat for both to meet somewhere in All who have seen both Eu- the middle. When the model-turned-runner Milind Soman ran rope and Asia thoroughly nude on a Goa beach recently, he was promptly greeted with a po- agree with me that the port of Goa, that of Constantinople, and lice case. A 2019 New York Times story on Goa looked at how the that of Toulon, are the three finest ports in both the continents. state had changed and found the rest of India barging into where The town is very large, and its walls are built of fine stone…Beef Westerners had once established themselves. It said: ‘When hip- and pork afford the ordinary food of the inhabitants of Goa. They pies traveled overland from Europe to India decades ago, Goa have also fowls, but few pigeons, and although they live close was often the final stop on the trail, welcoming to its beaches to the sea fish is scarce. As for confectionery, they have many Westerners who wanted to drop out in a place where living was kinds, and eat a large quantity. Before the Dutch had overcome cheap, drugs plentiful and swimming nude the norm... But most the power of the Portuguese in India, nothing but magnificence of the original countercultural community is now gone. It has and wealth was to be seen at Goa, but since these late comers have fallen victim to age, higher costs of living and the death of the hip- deprived them of their trade in all directions, they have lost the pie trail in the late 1970s, as wars closed the route. The final blow sources of supply of their gold and silver, and have lost much came, remnants of the community say, when the government of their former splendour. On my first visit to Goa I saw people started cracking down a decade ago on the informal businesses who had property yielding up to 2,000 écus of income, who on the hippies had set up to support themselves. Today, Goa’s ren- my second visit came secretly in the evening to ask alms of me egade lifestyle attracts an entirely new type of traveler—young
78 15 february 2021 Tourists on the beach in Goa
alamy
Indians who are flocking here not to find themselves, as the hip- responsible? They are not. If you compare Goans to rest of India, pies once did, but to celebrate their bachelorette parties or dance we are high in per capita income, social and political conscious- atop bars. As India’s economy booms and builds a middle class ness, we are much superior to people who are coming in. Those that barely existed two decades ago, Goa has transformed from people, how you will control (them)? Can you control them? a laid-back enclave for bohemian Westerners to a mass tourist We could control them at one point in time. But we jumped the destination for Indians.’ Russians…We decided to put all eggs in one basket. The British At present, the number of tourists who go to Goa in a year out- have gone away. And, now we are dependent upon the north number the local population manifold. It is still considered an Indians and this is what they do. They are not bothered about escape from real India, of afternoon naps, verdant lonely roads, Goa. They want to recreate Haryana in Goa.” somnolent villages mixed with beach markets, cheap booze and There is irony in this statement, as if history seems to have throbbing nightlife. Numerous writers, artists and others in the turned a full circle—from foreigners taking control to being creative field have shifted there. Many wealthy have holiday driven out to the welcoming of the foreigner again to the exclu- homes. The increasing influx of tourists has led to a backlash sion of Indians. Fortunately, that is only a fringe sentiment. Goa from locals. In 2018, the state’s tourism minister speaking at an is too integrated for politicians or parties to pull it in any other event called domestic tourists “scum of the earth”. The Indian direction. When its liberation is highlighted in the Budget Express quoted him saying: “Today we have almost six times speech, it is also a message about Goa’s liberation being an exten- population of Goa coming as tourists. Those tourists are not sion of the Indian freedom movement. There is no Goa separate top-end tourists, they are also the scum of the earth. Are they from the idea of India now. n
15 february 2021 www.openthemagazine.com 79 Openomics 2021 CAR SCRAPPage
No roads for Old Cars The voluntary scrapping policy drives fear into the hearts of the country’s last Padmini and Ambassador owners By Lhendup G Bhutia
y the time Finance Minister public two weeks later. Nirmala Sitharaman had finished The benefits of such a policy are easily understood.T here are reading out the Union Budget an estimated 1 crore such vehicles, many of them sputtering 2021-2022, it confirmed what and choking our airs. The environment will be cleaner without Akshay Somwanshi had feared them on the road. There will be more fuel efficiency on the road. for over a year. When asked for And the automobile sector will get a boost as people will look to his views the following day, he replace their old cars with new ones. Road Transport and High- replied, incensed, “How can they ways Minister Nitin Gadkari told the media after the Budget do this?” was tabled that this policy will push India to become the biggest B What had riled Somwanshi, automobile manufacturer in the world within five years: “[It] will a 25-year-old event management boost demand, create around 35,000 jobs and take the size of the professional in Pune, so much wasn’t the Government’s privati- automobile industry to around Rs 6 lakh crore from the current sation push or the large fiscal deficit or some of the Budget’s other Rs 4.5 lakh crore... New vehicles are more fuel-efficient, which in talking points. It came from a place far more personal. turn will [help] save on the country’s crude import bill. Besides, The Government had come between—what some like older vehicles pollute 10-12 times more than new vehicles. So Somwanshi believe—an individual and their beloved old car. this is a win-win policy.” In Somwanshi’s case, his Premier Padmini. But in India, the car, even an old one, holds a special place. In Sitharaman had announced, as expected, a voluntary vehicle the hierarchy of possessions, it usually slots itself right after the scrapping policy. According to it, any commercial vehicle that is house. And there are few old cars in India that evoke as much 15 years or older and a personal vehicle that is 20 years or older passion as the two that were for a very long time the only ones will have to undergo a fitness check at ‘automated testing cen- available: the Ambassador and the Premier Padmini. tres’. Those that fail will presumably be forced to the scrapyard. And for many who constitute the small but infinitely pas- Although the policy terms it ‘voluntary’, a series of incentives sionate fan base of Ambassador and Padmini cars, the voluntary and disincentives will compel an owner to dump their old car. scrapping policy will sound the death knell for their favourite According to some media reports, such incentives could come possession, already tottering on its last legs. in the form of a certificate that could be used to get a 5 per cent The owner of two Premier Padminis, Somwanshi fears it is discount on a new vehicle or vehicle loans on easier terms. The part of a push that will eventually lead to cars such as his being disincentives could mean exorbitant re-registration fees. The forced off the road and into the scrapyard. “Some of us may be able details are still being worked out but are expected to be made to keep these cars at the moment by passing these fitness tests or
80 15 february 2021 Illustration by Saurabh Singh Openomics 2021 CAR SCRAPPage
paying hefty fees, but through such policies people like us will be vehicles that merely carried them from one point to another. discouraged from keeping these cars. And even the few Padminis These were cars they lived with. that you see around right now will one day just disappear.” Kuruwa’s affection for the Padmini began when he was gifted The news of the policy did not come out of the blue. Minis- a scale model of the car as a child. After he graduated from college ters such as Gadkari have been talking about such a policy for in 2003, although he wasn’t very familiar with the Padmini’s en- the last few years. Many owners of Padminis and Ambassadors gineering and several cars were available in the market by then, watched with trepidation when the National Green Tribunal the first car he purchased was a 1986 standard Padmini. The car banned vehicles over 15 years from plying in Delhi a few years would break down frequently. And he remembers standing by ago. The tribunal however made an exception for vintage cars, the road with his family once, sticking his finger out for a lift, or those that are over 45 years old, which could be used for rallies with a beat-down Padmini which had broken down once again and exhibitions and for maintenance. But the Padmini and the behind him, with people laughing as they drove away. “That day Ambassador, younger in comparison and which fall in the classic I promised I was going to make my car so good that no one was car category, got no such protection. ever going to laugh at me,” he says. Online forums for Kuruwa purchased another Padmini; having become so in- Indian automobiles volved in the nitty-gritty of its engineering over the years, he has this year have been ensured his car remains as good as new. He also runs a website abuzz with conversa- dedicated to the brand through which owners of such cars con- As Padminis and tions on the likelihood nect with one another. Ambassadors of a scrapping policy and the ways in which gradually disappear owners of Padminis n Pune, Somwanshi—one of his two Padminis was from our streets, the and Ambassadors could passed down from his grandfather to his father to him—de- small community of protect their prized pos- I clares he will never allow someone to take his cars away from its passionate lovers sessions. These ranged him. “It’s part of [India’s] living heritage. We should be looking at have come closer. from getting them reg- ways for preserving it,” he says. To Somwanshi, it isn’t just that he istered in the regional is displeased with the new announcement. He thinks the policy There are WhatsApp transport offices of will be difficult to enforce. “Tracking cars that are old won’t be and Facebook groups smaller, less-vigilant easy. People will just start plying them where monitoring is less where they help each towns and cities to re- strict,” he says. other source parts stricting the use of the Over the years, as Padminis and Ambassadors have gradu- vehicle to within their ally disappeared from our streets—with even its taxi variants be- and share tips since house’s parking area. ing pushed off the road through court orders and more vehicle mechanics have now Mehul Kuruwa was brands becoming available to drivers—the small community of become increasingly one such worried indi- its passionate lovers have come closer. There are WhatsApp and unfamiliar with vidual. An insurance Facebook groups where they help each other source parts, pass on these cars professional based in tips since mechanics have now become increasingly unfamiliar Tiruppur in Tamil Nadu with these cars and share their individual stories about their cars. who owns a Padmini, “Retiring old cars isn’t going to solve the problem of air pol- he worried what shape lution,” says Joy Chavakkad, a Thrissur-based official in Kerala’s such a policy could take. revenue department. “It’s the extensive use of vehicles, not But after the details of old cars that will need fitness tests were necessarily old ones, that is contributing to increasingly poor air revealed in the Budget, he believes the care he has put into his quality. Retiring old cars will probably just have a small impact car over the years will enable him to see it through. “Many of us on air pollution.” were very anxious about what was going to happen,” he says. Chavakkad, who owns three Ambassadors, is a member of Driver after driver of these two brands waxes eloquent on the several Ambassador fan clubs in India. He organises rallies and efficiency of these cars and their excellent engineering, compact exhibitions and considers his three vehicles as part of his family. design and sturdiness on India’s terrible roads. Although Kuruwa The first of the cars he acquired from his father, who had used uses a Nissan sedan for daily use in the city, every time he needs it to ply a taxi. He is so attached to this car and the fact that the to go on a long drive, he takes out his Padmini, painted white vehicle helped his father earn a livelihood that he has even ac- with red borders. He likes to hear the thrum of the engine on quired a mobile number similar to the vehicle’s number plate. long drives, he says, and to gaze at the fishtail design of its lights. He acquired the other two over the years. What makes these vehicles special are the stories of the peo- “People think these old cars have little value and should ple using them; their attachment to these vehicles, very often be junked,” he says. “But for some of us, our lives are connected the first one they sat in or their families purchased. These aren’t to them.” n
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Dancing in the City Bengaluru emerges as the new capital of Bharatanatyam sal
n Raghavendra Raghavendra’s folder has, since closing the day with a Hot Chocolate RV’s desk is a folder Ananya’s inception, grown in size Fudge from the iconic Corner House where he files all and reputation. “When we began in Shankarapuram, Basavangudi. the applications hosting dance-based events in 2005, A Bharatanatyam dancer-choreog- he receives from after ten years of showcasing music, rapher, Praveen held a monopoly Odancers—experienced to aspir- we’d receive less than 20 applica- as the only Bharatanatyam teacher ing—from across the world seeking tions in a month; now it’s way more in his locality for nearly 12 years. He to perform at the many events and than 50,” he says, sipping his coffee, says, “In the last three years or so, in festivals at his prestigious 15-year- at his home in Malleswaram, “In and around the street where I live, I old not-for-profit trust, Ananya. fact, I have about 450-odd applicants hear there are more than a handful Originally a consultant at Geologi- still waiting for a chance to per- of teachers of Bharatanatyam.” cal and Metallurgical Laboratories, form.” More than 200 applications On January 17th, just as live a company that he co-founded with from amongst that pile are from performances returned, Bharatan- his wife, Pramila Bai, the couple Bengaluru and a bulk are in the atyam and contemporary dancer- is now committed to the cause of genre of Bharatanatyam. choreographer and actor Rukmini nurturing the arts—both classical Praveen Kumar is wrapping up Vijayakumar performed Ishwara: A music and dance—in Bengaluru. a recording for an online event, and Journey to the Self, a production dedi-
84 15 february 2021 (left) Praveen Kumar takes a class; prateeksha kashi at nitya nritya festival
Dancing in the City Bengaluru emerges as the new capital of Bharatanatyam By Akhila Krishnamurthy
cated to her father, K Vijayakumar. This tickets purchased were by dancers from that has always been considered its hub. 90-minute performance in the Bharatan- Bengaluru,” she says, quickly adding, “I’m “I don’t think there’s any reason to atyam framework, was presented at the not surprised because even though the compare Chennai and Bangalore in the Bangalore International Centre (BIC), a city has plenty of performances, rasikas context of Bharatanatyam,” defends 180-seat auditorium in Domlur to a full [connoisseurs] don’t hesitate to buy a Priyadarsini Govind, Bharatanatyam hall, needless to say adhering to social ticket for a performance.” exponent, and former director of the distancing protocols. For years now, Bengaluru has earned Kalakshetra. She says, “Chennai has line- From her parents’ home in Hebbal, for itself many titles: the Garden City that age and a sense of history, as far as this art Bengaluru-based dancer Keerthana Ravi slowly cracked the IT code becoming the form is concerned and that doesn’t mean enterprisingly conducted the sixth edi- hub for technology, a thriving city for one is better than the other. Bengaluru tion of EVAM, a Mumbai-based festival of start-ups, the capital of contemporary has always had a vibe of its own as far as dance that arose after Keerthana moved dance in India, a melting pot of cultures. the arts is concerned and many dancers cities, and that took an online avatar, cour- If numbers are indicators, content is of my generation and a few senior than tesy the pandemic. Featuring a host of proof and social media is a metric—for me—Padmini Rao, Padmini Ramachan- artists from across Delhi, London, Mum- both quality and diversity of work— dran, Kiran Subramanyam, B Bhanum- bai and Bengaluru, the festival clocked Bengaluru is fast emerging as the second athi, Dr Lalitha Srinivasan, just to name decent sales. “I’d say 25 per cent of the capital of Bharatanatyam, after Chennai a few—have done some phenomenal
15 february 2021 www.openthemagazine.com 85 dance
work in creating interest and fostering the art form.” In Malleshwaram, an old neighbour- hood in Bengaluru, that is literally the epicentre of Bharatanatyam, where dance schools share space with arts pa- trons and auditoriums, big and small— Chowdiah Memorial Hall, Seva Sadan, Ananya, Shukra—interest has been cultivated through events and festivals that have accorded equal space for art- ists outside of the city with local talent, ensuring the co-existence of learning and performance. Nupura, a dance institution founded
by acclaimed Bharatanatyam guru, s ar Sunny Jage Rukmini Vijayakumar Lalitha Srinivasan, who is a specialist in the Mysore style of Bharatanatyam, Photo having learnt it directly from K Ven- ‘Performing in this city is just special because I know the audience won’t judge me’ Rukmini Vijayakumar dancer katalakshamma, has, since its inception 42 years ago, trained more than 500 students who continue to perform and teach dance across the world. go to them for bringing stalwarts like that the “openness” of the dance com- In the year of the pandemic, Dr Padma Subrahmanyam, Alarmel munity in the city has elevated its status Nupura celebrated 35 years of Nitya Valli, Malavika Sarukkai to perform in as a dynamic centre for Bharatanatyam Nritya, an annual festival of dance Bangalore way back in the early ’90s, and in India. “It’s also very heart-warming that has raised the standard in terms that exposure introduced us, dancers to perform there,” Rama says, “and to of curation and presentation. “We to the idea of quality and standard in always have a whole host of dancers, feature all forms of dance, not only the arts,” says Praveen, a student of CV young and old, always in the audience Bharatanatyam, but needless to say, Chandrasekhar, a Bharatanatyam expo- and who support other dancers.” the latter occupies pride of place,” says nent based in Chennai, who has been From her home in London, young Manu Srinivasan, daughter of Lalitha performing regularly at the Margazhi Bharatanatyam dancer-choreogra- Srinivasan and a dancer who is col- season of music and dance in Chennai pher, Divya Ravi, with roots in Ben- laboratively also in charge of the festi- every December. galuru, says the city provides three val with her mother who envisaged it. “Bangalore always had a constant essentials every artist wishes for—“a “To be honest, over the last few years,” thirst to learn and grow,” says Priya- safe space, an open-minded audience she adds, “curation has been truly a darsini Govind, who travels often to that can truly provide constructive challenge because of the spurt in the conduct workshops in Bengaluru from feedback and a remunerative avenue”. number of good dancers in Bengaluru, her home in Chennai, “I remember Divya’s contribution to the dance who are all raising the bar in terms of going there when I was in my 20s with landscape, especially during the pan- content and performance.” my guru, Dr Kalanidhi Narayanan for demic was significant in terms of the Unlike a ‘sabha’ culture in Chennai an abhinaya workshop and I remember immersive conversations she curated where a group at the helm of an institu- being struck by the enthusiasm of the with a set of dancers and the range of tion serve as gatekeepers of the arts, participants.” content she created to keep pushing Bengaluru has emerged as a new centre Bustling with a vibrant workshop the creative envelope. of Bharatanatyam thanks to dancers culture, the Bharatanatyam world in What is also significant in Ben- themselves who have donned the head Bengaluru is also appreciative of many galuru is the fact that almost all shows, sets of organisers for years, curating perspectives and styles that exist within small or big, are ticketed, enabling an consciously and presenting festivals its large and dynamic framework. ecosystem for the arts and the artists. that allow for learning, aspiration and Rama Vaidyanathan, Bharatanatyam “I think it is also fair to say,” Divya showcasing. exponent with students from across the adds, “that Bangalore was among the Amongst the leading festivals that globe, who visits Bengaluru from Delhi first cities [in India] to begin live-cast, have acquired landmark status, eight several times in a year—for both work- online ticketed performances well are curated by dancers. “Credit must shops and performances—reiterates before the trend actually caught up in
86 15 february 2021 Photo Sumukha
divya ravi and sharan subramanian perform at The Living Room Kutcheri
‘Performing in this city is just special because I know the audience won’t judge me’ Rukmini Vijayakumar dancer
the year of the pandemic.” ver the years, Bengaluru has Bengaluru, says that sharing work with If marriage took artists like Divya also witnessed the birth of an audience “here is just special because I out of Bengaluru, others like Apoorva O spaces, intimate and infor- know they won’t judge me. The eclec- Jayaraman, for instance, a young mal—Shoonya, Courtyard, Ishva, tic nature of the city also organically Bharatanatyam dancer-choreographer, BIC—that have created possibilities for manifests in an audience that sometimes who was raised in Bengaluru and who experimental work within a traditional walks into a performance with little or no studied astrophysics at Cambridge repertoire and have served as an adda knowledge of the dance form but filled University, made a conscious decision for dialogue and debate. During the with curiosity and an appetite to engage, to move to Chennai to pursue Bharatan- pandemic, when the performance without any prejudice or bias.” atyam. Under the guidance of Priya- venue shifted from a proscenium stage Shruti Gopal, a Bharatanatyam darsini Govind, and with a sparkling to social media, Raghavendra watched dancer-choreographer-teacher, who dance voice of her own, Apoorva, who with empathy how some dancers strug- runs the Upadhye School of Dance with is also a curator, says,“I had a remark- gled to create spaces (to perform) within her husband, Parshwanath Upadhye, able amount of exposure—traditional, their homes. “Five months ago, to bridge also a well-known dancer, takes pride cross-disciplinary and contemporary that gap, we added a separate 150 sq ft in Bengaluru’s Bharatanatyam culture. work alike—even as a child, thanks to space adjacent to the auditorium that “We are really a world of our own,” my teacher, Padmini Ravi. Owing to its dancers can book [free of cost] and hire a Shruti says, “Growing up, learn- nature, as a city, Bangalore gave, and photographer to capture their dance in ing dance under my guru, Padmini continues to give, every young dancer, ways that work for the digital medium,” Ramchandran, a student of Vazhuvoor a personal space to flourish where no says Raghavendra. Ramiah Pillai, I always watched how dream seems too big and you don’t ever Brimming with the voices of dancers she consistently pushed the creative feel afraid to experiment.” who are keen to inspire a younger gen- envelope within the traditional frame- Apoorva admits she “dared to dream eration to pursue the arts, as a full-time work. I still remember how she created a big because of Bangalore. Yet, my own profession and committed to make it production inspired entirely by Bengali definition of what this big was crystal- work financially, Bengaluru is also vocal paintings and another one on Jesus that lised in Chennai”. The arts scene in about resisting the culture of paying to I was also a part of. I think our—and I Chennai carries with it, she notes, “the perform at a concert. mean, dancers in Bengaluru—box to gravitas of a long and deep relationship Equally crucial from the point of view create and innovate has always been with dance and here I became cognizant of an artist is the audience. Rukmini a bit large, a bit open, a bit without of how much there is to know before Vijayakumar, who has performed at boundaries.” Perhaps, the most crucial one can really be ready to spread one’s prestigious venues across the world and for any artiste; a box that can breathe, wings in the world of the arts”. whose home and heart is her hometown, free, masked or otherwise. n
15 february 2021 www.openthemagazine.com 87 art
identitty few months ago, doctor and educator by indu harikumar Dr Tanaya Narendra was invited to do an Instagram live by a student organisation in Bangladesh. While posting about the event, the Aorganisers wrote that Dr Cuterus—the name Narendra goes by on Instagram—was going to talk about “shush topics”. As a millennial woman whose very work on the platform centred around breaking barriers and taboos around sexual health, Narendra found this upsetting. She asked her brother, “Why do we have to say shush topics? Why can’t we screw the shush?” And that’s how #ScrewTheShush was born. Using the hashtag, Narendra has done a slew of posts on
instagram/induviduality/ instagram/induviduality/ her award-winning Instagram page around abortion and the right to choose, freezing your eggs, vaginal discharge, masturbation, PCOS (polycystic ovarian syndrome), among Courtesy others. From only a few thousand followers at the beginning of last year, she now has 1.3 lakh followers. The Oxford- trained doctor finds inventive ways to impart information on sexual health—a fairy-tale love story on how periods work, a Shush Godfather-style analogy to explain PCOS. Born to parents who are fertility experts, Narenda grew up in a household where saying “vagina” was a normal, factual occurrence. “I remember I was about eight and had gone to a No More neighbour’s party. When asked where my mother was, I said she’s gone to operate on someone’s ovaries and was chucked Art and infographics on social out of the party,” she recollects with a laugh. media platforms are breaking taboos Narendra’s household is an anomaly in a country where any conversation around sex is treated with squeamish- By Shikha Kumar ness and internalised shame, whether that’s with parents, nstagram.com/kaviya.ilango/ Courtesy i
instagram/vantagold/ (left) Panty series by Namita Sunil; dirty laundry by Courtesy Kaviya Ilango
88 15 february 2021 teachers or even healthcare practitioners. ‘It isn’t just stories of body shaming and self-acceptance, It’s what led Leeza Mangaldas to start her sex about women which were illustrated by her and shared on positivity YouTube channel and Instagram CEOs. Financial her Instagram page (@induviduality). page in 2017. “As a young woman navigating equality The idea of crowdsourcing came to so many life experiences that are firsts for needs to be Harikumar after her project, #100IndianTin- that age, whether it’s having an orgasm or accompanied derTales, inviting people to share their Tinder exploring your own sexuality or body, I felt by sexual and experiences in India, went viral a few years like there were no safe spaces for Indians to reproductive ago. “One person wrote in to say they were turn to,” she says. Her Instagram bio states: equality’ ashamed of the colour of their genitalia. Imagine a world where all sexual experiences leeza mangaldas When I asked a question around this, I got so are consensual, safe, and pleasurable. content creator many responses. People said their access to Today, her YouTube channel and Insta- any kind of genitalia was through porn, often gram page collectively have nearly 4 lakh white porn, and so they felt like something subscribers, an ever-growing, curious com- was wrong…a disconnect between what they munity of Indians looking to access credible saw and what they had,” she says. information around sex, pleasure and bodily As quarantine kicked in last year, model autonomy. In fact, when it comes to the latter, and illustrator Namita Sunil started her Panty she’s a fierce advocate of women exercising Girl series as an exploration of the female form, more agency—her page has posts encourag- ‘People’s access inspired from her own experience as a fashion ing women to carry condoms, ethical porn to any kind of model. Using brush pen on paper, the black- and reviews of sex toys like vibrators. “People genitalia was and-white works were her attempt to dissect think a vibrator is some sort of anomalous through porn, bodily autonomy and consent before the male or freaky thing. But in cultures that are sex often white gaze, and to reclaim space as a model without positive, a vibrator is almost considered an porn, so there the pointed direction of a photographer. essential, like a toothbrush or razor. You don’t was a disconnect In a more realistic twist to the #100Days have to be hypersexual or kinky—not that between what trend on Instagram, Mumbai-based Kaviya there’s anything wrong with that—to use one. they saw and Ilango began the #100DaysOfDirtyLaundry People buy it because it’s a nice, empowering what they had’ challenge to ‘uncover everything unholy, way to access pleasure without anyone else.” indu harikumar uncomfortable, cringe-worthy’, whether Given the unequal access to technology artist that was masturbation, complicated love, or in the country—most studies peg female in- indefinable sexuality. While one post had ternet users at less than half of male internet three different women with scars and stretch users—this also throws up an interesting conundrum, one marks on their legs, another featured a woman soaking in a bath that Mangaldas is acutely aware of as a content creator. Because tub while on her period, lollipop in one hand. ‘Wish I didn’t have of her background as a sports presenter, she’s used to having a to bleed blue only for the Indian cricket team,’ read its caption. largely male audience. She says that men have stumbled upon Harikumar’s other project, #Identitty, stemmed from a her videos because they were looking for porn and the title has conversation she had with a friend, who opened up about how orgasm or sex in it. “Then they stay for the sex education lesson ashamed she felt of her heavy chest when she was younger, and and think ‘oh, this is cool.’ It’s important for me to take men on all the unwanted attention that came her way. The illustrator this journey—in an Indian context particularly, they control herself had struggled with the opposite—as a skinny girl, she access to so much like technology, information and even had felt like she had nothing to “offer”. Soon enough, women, medication. Women have told me they discovered my channel trans people and non-binary folk started sharing their stories, through a male relative or friend. Because of the shame and often accompanied with photos of their breasts, an exercise in stigma around these conversations it doesn’t get sufficiently innate trust that the artist took some time to fully comprehend. addressed, but it plays a huge part in women being able to The project brought forth fascinating, and often empower- have equal rights,” says Mangaldas, adding, “It isn’t just about ing, perspectives about a body part that’s been hyper sexualised women CEOs. Financial equality needs to be accompanied by in media and popular culture. While one person wrote about sexual and reproductive equality.” gender dysphoria and sex reassignment surgery, another The anonymity and sense of community that the internet spoke up about loving her flat chest after a double mastectomy offers has also led to artists pushing the boundaries on their art, for breast cancer—all of which were brought alive through often enabled by the experiences of their followers. In 2017, artist beautiful illustrations by Harikumar. Whether it was #BodyOf- Indu Harikumar started #BodyOfStories, a crowdsourced project Stories, #Identitty, or any of her subsequent projects in the years to ‘explore and celebrate the many and varied ways of experienc- since, they achieved a common purpose—making people feel ing the human body.’ Both men and women wrote in sharing less alone. n
15 february 2021 www.openthemagazine.com 89 cinema
‘The Roles We Play Give Us a Better Understanding of People, Reality and Ourselves’ Geetanjali Kulkarni’s primary playground has been Marathi theatre. Her popularity has now been fuelled by recent online hit series By Namrata Joshi
Geetanjali Kulkarni
Photograph by Puneet Reddy
90 ‘The Roles We Play Give Us a Better Understanding of People, Reality and Ourselves’ Geetanjali Kulkarni’s primary playground has been Marathi theatre. Her popularity has now been fuelled by recent online hit series
n the aftermath of the women wearing the gajras and silk saris. phase. I performed hundreds of shows successful second coming of Shan- I used to direct plays and performed in in every nook and corner of Maharash- ti Mishra in the popular web series them for the Ganapati functions in the tra,” she recalls. Gullak 2, actor Geetanjali Kulkarni colony,” recalls Kulkarni who grew up She credits theatre for having laughs about how the character in a Marathi cooperative society in IIT helped her hone her craft as an actor. has turned her into the mother Powai. “Though we lived in flats, the “It’s an actor’s medium. It makes us feel ofI the entire country. However, Shanti sentiment was of a chawl—open doors, empowered. I love spending time with is not the classic submissive, sacrific- exchanging recipes, all festivals celebrat- a character, processing it, which theatre ing matriarch we are so used to seeing ed together, one TV and phone for the has taught me,” she says. on screen. “She doesn’t shy away from whole colony. It was like a Sai Paranjape She also finds the medium more expressing herself... She is always rant- film set,” she says with a laugh. organic, in tune with the rhythm of ing, taunting,” says Kulkarni. In fact, Theatre was still just a hobby though life. “There are no second chances, no when she first read the part, Kulkarni she joined Ruia College in Mumbai retakes. You get the opportunity to bet- specifically asked writer Nikhil Vijay because of its strong theatre culture. ter yourself only in the next show,” she why Shanti had to be so shrill, even During the college shows she realised says. She loves it for what she describes when talking to her husband and two her own deficiencies as an actor and, as the simultaneity of birth and death; sons. “I was taken aback by the pro- after graduating in economics in 1993, how a show is about creating—stories, found thing that the youngster told characters, feelings, thoughts and ex- me—that if she wouldn’t shout, nobody periences—which come to an end once would lend her an ear,” says Kulkarni, the performance itself is over. “You stressing on the urgency for a woman to have to start all over again, recreate the be loud and assertive, often combative, There are no second same cycle in another outing,” she says. to create a rightful space for herself in a She compares this essential tempo- male-dominated world. chances, no retakes rality and temporariness to cooking a Her own personality, and the world in theatre. You get the meal. You prepare a dish, it turns out she inhabits, might be totally at odds well or perhaps not, you eat it and then with that of her popular on-screen avatar opportunity to better have to cook another meal, to approxi- but Kulkarni believes that a majority of mate the same taste or better it. “It is women are caught in the same quandary yourself only in the for this reason that, even if I am doing as Shanti: “The roles we play often give us very well on screen, I will always find a better understanding of people, reality next show” time for theatre. It keeps me aware as an and ourselves.” Geetanjali Kulkarni actor actor,” she says. And Kulkarni has played a plethora Kulkarni caught the connoisseur’s of them, on stage and screen, for over the 20-year-old joined the National eye with Piya Behrupiya, Atul Kumar’s two and a half decades now. Her primary School of Drama much against the rambunctious Hindi stage adaptation playground has been the proscenium, wishes of her family. “NSD was about of Shakespeare’s Twelfth Nightwhich more so Marathi theatre. Just like any experiential learning. It was my rebirth. she has been doing now for eight years other middle-class Marathi household It completely changed my sensibilities,” and, later in cinema with Chaitanya in Mumbai, going to auditoriums like she recalls. It was also where she met Tamhane’s biting satire on the legal sys- Shivaji Mandir and Dinanath Mangesh- famous actor Atul Kulkarni, her senior tem Court where she played the public kar Natya Griha was de rigueur in her who later became her husband. prosecutor in the trial of a protest singer. family. She grew up observing actors Initial success in theatre came But the popularity with the public at like Bhakti Barve, ShreeramLagoo, through plays like CP Deshpande’s large has been fuelled only recently Datta Bhatt, Nina Kulkarni, Vandana experimental comedy about man- with series like Gullak, and Taj Mahal Gupte on stage. “I used to love the woman relationship Buddhibal Ani 1989 about different shades of love in atmosphere, the third bell, the opening Zabbu and Paresh Mokashi’s Sangeet pre-Internet Lucknow and Rohena of the curtains, the smell of batata vada, Debuchya Mulee. “That was a wonderful Gera’s debut feature Sir where she played
15 february 2021 www.openthemagazine.com 91 cinema
Laxmi, a fellow maid and confidante of the lead Ratna (Tillotama Shome). According to her, unlike films, TV and streaming platforms, theatre has a committed but limited audience.“My work has reached the masses in dif- geetanjali kulkarni in gullak (left) and taj mahal 1989 ferent parts of India through the OTT platforms,” she says. She did try for rejected or, fortuitously, those commer- Till 2019, apart from her other com- films after graduating from NSD but cial projects never took off. mitments, she had been working with could not find what she was looking for. The innings in Marathi theatre, children on theatre, music and other Commercial cinema was not exciting however, has been peppered with some art forms in her village in Wada taluka enough, parallel cinema had plateaued commercial blockbusters. Like Paresh (100km from Mumbai) in association out. But now there is a new burst of Mokashi’s Mukkam Post Bombilwadi and with the NGO Quest (Quality Educa- energy which is feeding her hunger for Lagna Kallol of which she did over 500 tion Support Trust). “It’s not just social good roles. shows each. She attributes the success work. It’s something I get a lot of energy to Mokashi’s unique sensibility and and education from. Children give you sense of humour that she couldn’t find fresh ideas. Also, theatre is empower- ar from being cynical or in other commercial ventures. “As ing, and I like to share that experience bitter, Kulkarni is happy that a child I always wanted to be part of with people. It gives me a lot of joy to F popularity has come to her late in Marathi commercial theatre but found help people find their own modes of life, in her forties, when she has become that I wouldn’t have sustained in it for expression, irrespective of what field more comfortable with herself, both long,” she says. She then veered towards they are in,” she says. as an actor and as a person. “I can do a experimental theatre. She produced her Life is split for now between a small small role in Sir with as much love as the own plays, a landmark one on breast flat in Goregaon East that she calls her lead in Taj Mahal and Gullak. Ten years cancer called Ek Rikami Baju (An Empty ‘transit home’, and a huge house in the back I may have been insecure but now Side). She did the iconic Sex Morality and village where they have “put in their I know that I can create work for myself. Censorship with Sunil Shanbag, Haath heart and soul” and where they like to I am not competing with anyone. I Ka Aaya… Shunya with Manav Kaul escape to at the smallest opportunity. love competing with myself,” she says. and Gajab Kahani with Mohit Takalkar For now, there is lots coming up on For her what matters is whether she is which she continued to perform in, the work front. Her new Marathi film, constantly growing and evolving as an until the lockdown halted it. Mangesh Joshi’s Karkhanisanchi Waari actor and as an individual. “My scripts At this juncture though, she would (Ashes on a Road Trip) premiered last and assignments should empower me not mind trying a hand at a main- week at the International Film Festival as a person. The length of my role doesn’t stream film that is set in a fantastical of India in Goa. A Kannada series titled matter. The story has to have value in my space, irrespective of whether she is Humble Politician, has her playing a life. It’s even better if it also has value for successful at the attempt or not. “As an Hindi-speaking politician. She had the society and the world,” she says. actor you have to constantly experi- done a cameo in a DICE Media produc- It has been the reason why she ment with yourself. It’s only then that tion, Operation MBBS; the role of the picked up relatively small roles in Sir, you realise what’s your own path, the dean of a medical college that has Shubhashish Bhutiani’s Mukti Bhawan kind of stories you want to tell. You have become a bigger part in the second and Ritesh Batra’s Photograph. They gave to get out of the comfort zone to under- season. The shoot for the second season her the opportunity to work with film- stand yourself,” she says. of Aarya begins in March. makers with a unique aesthetic sense She likes to step out of her comfort What is yet to happen is a project and vision and their own distinct way zone in life too, trying to make theatre in which the talented couple—Atul of telling the story. “I would have been socially relevant. From 2016-2019 she and Geetanjali—gets to work together. foolish to not have done them,” she says. worked on a project called Goshtarang There was one script by Mukti Krish- Her characters so far have been where five actors from Maharashtra nan which the two were excited about, rooted in the real. She attributes it to the were picked up and trained for a fel- but it didn’t find a producer. “We are independent, experimental, arthouse lowship programme to perform over very independent people,” says Kulkar- cinema that she has been associated 100 shows for underprivileged, tribal ni, “We’d do it, if it comes organically with. She calls it her comfort zone. and rural children in 50 schools. It was but we are not into pushing projects.” Opportunities to play “mother of Arjun all about strengthening theatre and She only pushes the limits of herself as Rampal” had been either consciously literacy at the grassroots. an actor. n
92 15 february 2021
books
Forest of Ideas The Dharma Forest Keerthik Sasidharan reimagines the Mahabharata Keerthik Sasidharan Penguin to find meaning for the 21st century reader 400 Pages | Rs 499 By Arshia Sattar
ours before Jara the who answers the question by narrating I am. Where did I come from? hunter killed the much the lives of two great warriors and one Why am I here?’ Whichever be the ‘Hbeloved eighth avatar of our angry woman. And we, as readers, listen answer that the avatar seeks, be it Lord who was seated under that along with Krishna and are afforded an- knowledge of the divine condition or leprous tree of enlightenment, he other view of the events that we already the human one, the conundrum of the found himself awash in a wave of mel- know, a view now coloured by a search man-god is compelling. ancholy that crashed in as he dreamed for what might make these characters Since neither text in itself answers of making love to his wife who, even in like you and me. these questions, it falls upon later com- that ephemera between deep sleep and This is a great setup—a dying god, mentators and re-tellers of the story to wakefulness, straddled over him, as she who has just spent his life in the world carry this theological and existential usually did, with the purposefulness of of men, asking the most fundamental burden forward and to respond from a good samaritan trying to resuscitate a of all questions and being given a series within their own time and place. drowned man.’ of answers by a truly minor player in Sasidharan does this, as have countless If you make it past this opening the great game that he, god, has just others. I believe that those of us who sentence into Keerthik Sasidharan’s unfurled for the benefit of all beings. know the Mahabharata well will find re-visioned Mahabharata, you will, Krishna has lived his life as a god, that Sasidharan’s valiant attempt to ad- indeed, find yourself in a forest. The performing miracles and subverting dress the question that he himself raises Dharma Forest, lit by a sun-filtered the natural order of things. Rama, on falls short. There is little here about the sincerity and fed by both writerly ambi- the other hand, has lived through his characters and enhanced situations that tion and imagination, is dense with avatar largely as a man and says to I have not read elsewhere or thought words and ideas whose lush and fertile the gods at the end of war, ‘I always before. But it could well be that I simply undergrowth reaches deep into an an- thought I was human, that I was Rama, missed the dharma forest for the trees. cient text to find truth and some kind of the son of Dasharatha. Tell me who However, I have little doubt that transcendental meaning for a vast and hungry public the 21st century individual. which seeks to valorise a Sasidharan plans to write Keerthik Sasidharan mythic past as history via a trilogy that experiences the ‘real’-ised characters will be Mahabharata through the enthralled by Sasidharan’s lives and deeds of different narratives. This growing characters and this first readership discovers classical volume explores Bhishma, texts almost exclusively Draupadi and Arjuna. through their modern retell- Sasidharan sets an interest- ings which are inflected with ing frame for the story that he both commentary and inter- wants to tell. The book opens pretation by their authors. It’s with Krishna, who has just good to remember, though, been shot in the foot by the that every retelling is neces- hunter Jara. As he lies bleed- sarily incomplete in terms of ing, occupying the twilight the original text. And so, we state between life and what should all read as many of comes after, Krishna, avatar them as we can as we strive of the great god Vishnu, asks to reach an approximate perhaps the most critical understanding of how our question of all—what does it ancestors wrote about being mean to be human? It is Jara in the world. n Illustration by Saurabh Singh
94 15 february 2021 The Showman Enter Stage Right The Alkazi / Padamsee Family and the Shaman memoir Feisal Alkazi
A family memoir chronicling the deities of Indian theatre Speaking Tiger By Geeta Doctor 254 Pages | Rs 699
intersection of conflict- amsee and his brother-in-law, Ebrahim ing cultures. Kulsumbai Alkazi. Feisal Alkazi introduces his fa- made sure that her ther’s family as Baghdadi Arabs who had ever-increasing brood settled down in Pune. Ebrahim is just received the best of an 18 when he meets the most charismatic Anglicised education of the Padamsees, Sultan—or Bobby as s archive alkazi theatre even as she held them he was known at St Xavier’s College in together with her gargan- Mumbai—during an amateur produc- Courtesy tuan Sunday lunches. tion of Oscar Wilde’s Salome. When the Many decades later it young Parsi actress refuses to perform was here that I watched the erotic Dance of the Seven Veils, Bobby a production of Alyque gets his sister Roshen to take her place. Padamsee’s staging of Feisal adds: ‘That’s how my parents met.’ Harold Pinter’s The Birth- The second part of the saga takes day Party. Two rows of place in Delhi where Ebrahim Alkazi seats were positioned at becomes the mediating force at the the far end of the room. National School of Drama in Delhi. The actors were up The focus also changes to plays in Hindi close and neurotically and those translated from the regional. engaged with Pinter’s If Alyque was the consummate entanglements. It was showman, Alkazi senior was a shaman. difficult not to feel suf- He transformed the scripts and the focated. Theatre was not young actors by a rigour that combined entertainment. It was the different acting methods as also the Ebrahim Alkazi as Macbeth, 1956 visceral. It had to grab need to create a language for a society you by the throat and still struggling from a fractured past. f it were possible, I would have grind you into the depths where you Whether in the intimate environs of sat on the steps of Mumbai’s Colaba might glimpse alternate visions of who the Triveni Kala Sangam auditorium, ICauseway and wept. you might be, or even could be. or the Art Heritage gallery run by Or at least tried to during the opening “Are you God, as many people sug- Roshen, the space for discussion and chapters of Feisal Alkazi’s richly evoca- gest?” I asked Alyque Padamsee during dissent was always open. tive era of Mumbai’s English theatre an interview for Debonair. He was at the Feisal’s text flits between revelations world. He documents the collective height of his career as an advertising of old family secrets, short resumes of passion of the two families—the Alkazis maverick as well as the most imperative both the dramas and divas who glittered and Padamsees—to which he belongs of theatre directors of the time produc- onstage and his own trajectory as actor and the two great cities Mumbai and ing musicals like Jesus Christ Superstar and director. He also pays a tribute to Saf- New Delhi that formed the backdrop to and Girish Karnad’s Tughlaq, a play dar Hashmi. Earlier on in Mumbai, Pearl their theatrical journeys. fraught with allusions to the dangers of Padamsee had directed The Resistible Rise There is a whiff of Midnight’s an authoritarian state. He fixed me with of Arturo Ui, an indictment of how we the Children in the tumult of his maternal a Jinnah level glare, clamped his mouth people create our leaders. Then again, grandmother Kulsumbai’s home at and did not answer. Gods don’t need to. Feisal reproduces a haiku by his mother Kulsum Terrace on Colaba Causeway. There are many deities that parade abandoned by her husband. The solitary An affluent family of Khoja Muslims through the pages of Alkazi’s memoir. bird/Sings. Feisal has a whole aviary from Gujarat, the Padamsees were at the The two that stand out are Alyque Pad- behind him. Every page sings. n
15 february 2021 www.openthemagazine.com 95 books
Loss and Hope Celebrating the resilience of the human spirit in the face of the pandemic By Lov Verma ap A health worker at Sir Ganga Ram Hospital, Delhi, June 2020
he literature around Like an Apple?’—about a millionaire (‘The Pages of My Quran’). The challenge Covid-19—Covid-lit, as I prefer to reduced to selling fruit to survive the of vaccine development is seamlessly T call it—has been steadily gaining challenge of the disease. woven into another narrative, namely, traction, readership and popularity. It Acharjee’s second device is to keep ‘A Dose of Covaxin’. spans the gamut—from Coronavirus: her stories short and crisp, to cater to the Next, Sonali seems to be on a mission A Book for Children by Elizabeth Jenner, short attention-span of today’s reader. to educate the reader. Nothing preachy, Kate Wilson et al to Till We Win: India’s The prose is precise and direct and none just bite-sized bits of medical informa- Fight Against the Covid-19 Pandemic, co- of the pieces exceed a dozen pages. Each tion, be it about cytokine storms or silent authored by Dr Randeep Guleria, Direc- story is self-contained—which makes hypoxia. The author makes the virus tor, AIIMS, New Delhi, Dr Chandrakant the book an ideal one to read on-the-fly. that much easier to understand. Lahariya and Dr Gagandeep Kang. Thirdly, Acharjee wisely chooses to Finally, the sheer variety Acharjee And when journalists gate-crash the use Covid-19 only as a peg to hang her showcases is nothing short of mind-bog- party, sparks are bound to fly. Sonali stories on. This avoids monotony and gling. Apart from life-experiences this Acharjee, veteran journalist who has repetition. The range of issues tackled extends to demographics (eight years to worked with a number of publications, by her are diverse and pertinent—from ninety-eight), geographies including this magazine, and who menstrual hygiene to neo-natal mortali- (Shillong to Palakkad), and classes currently covers health for India Today, ty, to attacks on health workers and how (nurse to millionaires). jumps into the fray with Life Behind to sensitise children to the pandemic. In essence, the theme of Acharjee’s Masks. There is also a poignant pen-picture of a book is hope in times of terror, ignorance A collection of twenty-one stories young Muslim girl caught in the unfor- and depression. Many of the stories grouped around three themes—Love, giving East Delhi riots of recent memory celebrate the resilience of the human Loss and Duty—it is a topical and spirit in the face of the pandemic. entertaining read. As Acharjee says in Shortcomings? Hardly any. The her introduction, she attempts to distil proof-reading, however, could have been people’s ‘loss, dreams, confusion and sharper. More pertinently, some of the memories’. In this she succeeds. Largely. stories do not work. Obviously, each It is interesting to deconstruct the reader will have her personal favourites. book to examine the arsenal of tech- But, for me, the weak links were ‘A niques and strategies employed by the Journey through My Journal’ and ‘Me author to grab the eyeballs of what ap- Against the Media’. Surprising, since pears to be her chief audience—millen- both dealt with the author’s home-turf! nials. Right off the bat, she uses intrigu- Life behind Masks: But these are minor niggles. Acharjee The Many Shades of Hope ing chapter headings to evoke in the Times of Covid deserves kudos for adding to our knowl- curiosity. Sample these—‘He is My Sonali Acharjee edge of the disease in an interesting Father’, ‘A Girl and Her Screwdriver’ and way, through heartfelt stories. A classic my personal favourite—‘Would You Hay House example of edutainment. n 248 Pages | Rs 399
96 15 february 2021 The beauty of the written word; a story well told. The luxury of immersing myself in myriad lives; journeying to faraway lands. I am obsessed. And the Reviews in Open help me discover the best. A quiet corner. An interesting book. Life’s good!
Sanjay Malik, Dubai
Tell us why you read Open www.openthemagazine.com openthemagazine STARGAZER Kaveree Bamzai
Karan Johar Alia Bhatt Ranveer Singh
➲ Atmanirbhar Heroes be a cameo by Salman Khan in Shah long apperance in Baby (2015). Over the next two years India will be Rukh Khan’s Pathan. Salman will play flooded with mythological heroes. Tiger and appear towards the end of ➲ Tata Takht The Indian film industry has decided the Siddharth Anand-directed movie. News that Karan Johar is directing to go back in time to look for heroes Salman will then go straight into Ranveer Singh and Alia Bhatt in a and even anti-heroes. Storytelling playing Tiger once again in the third love story indicates the end of his will be a mixture of great narratives edition of his spy franchise, this time ambitious but ill-fated Takht. The and sharp special effects as an array of to be directed by Maneesh Sharma, a movie which was going to delve into atmanirbhar (self-reliant) superheroes favourite of Aditya Chopra. Salman the relationship between Aurangzeb descend on the big screen. Nitesh returns to the cleanshaven Tiger of the (Vicky Kaushal) and Dara Shikoh Tiwari is working on a retelling of the first film even as his mission predictably (Ranveer Singh) was expected to Ramayana for the big screen; Aditya takes him across half the world. What cost Rs 250 crore. After the failure of Dhar, who wowed the establishment we are seeing is the birth of a new the big-budget Kalank (2019), it was with Uri: The Surgical Strike (2019), hyphenated franchise, Pathan-Tiger, always going to be difficult for Dharma will tell the tragic story of Drona’s if the Shah Rukh film succeeds, which Productions to sustain Takht but the son, Ashwathama, played by Vicky will probably be on the lines of Rohit Covid-19 lockdown first ensured Kaushal. Rana Daggubati, a fanboy Shetty’s ever-growing cop universe. cancellation of the shoot in Florence, of the Star Wars franchise and Amar Italy and then the postponement of Chitra Katha comics, will be playing ➲ Back to Magadh production on sets in Mumbai. He Hiranyakashyap, whose story he heard Writer and director Neeraj Pandey has promised an “epic series” as part as a child. Both Ashwathama and will be paying homage to his native of the “Change Within” initiative to Hiranyakashyap believed they were Bihar in an ambitious film he is contribute to Prime Minister Narendra immortal, which anyone who has read working on, starring Ajay Devgn Modi’s “nation-building narratives” our epics knows is an invitation to a as Chanakya. After much research to celebrate 75 years of Independence. very public humiliation. Prabhas plays on ancient Magadh, Pandey has Perhaps the Mughals do not epitomise Ram and Saif Ali Khan plays Raavan finalised the script and will start the “values, valour and culture” of in Om Raut’s Adipurush. Deepika casting for the young Chandragupta India Johar tweeted about, tagging the Padukone is developing her dream Maurya whom Chanakya mentored. prime minister. of playing Draupadi. Is this a copycat Pandey who created The Special Ops phenomenon? Or is there a deeper series for Disney+ Hotstar, under the ➲ Did You Know? search for meaning here which ends FridayStorytellers banner, is now Former collegemates Aravind Adiga reliance on remakes of past movies and working on the backstory of his lead and Ramin Bahrani have proved rip-offs of foreign films? Mirroring the character Himmat Singh, played by to be a successful combination for flourishing genre of Indian epic fiction Kay Kay Menon. The Special Ops took Netflix. After The White Tiger, they will in literature, the film industry hopes to off from the 2001 attack on Parliament, adapt Adiga’s novel Amnesty, about bring to the big screen these made-in- so expect the special edition to go immigrants in Australia. Bahrani’s old India offerings. further back. It is clearly all about friend Ashok Amritraj, one of the first creating a web of narratives which can Indians to set up shop as a producer in ➲ Pathan Meets Tiger lend themselves to individual spin- Hollywood, will join them as producer. Yash Raj Films, which has had a offs. Pandey pioneered this in Naam A former tennis player and brother of miserable two years with only War Shabana (2017) when he co-produced ace Vijay, he co-produced Bahrani’s (2019) clicking at the box office, has the new vehicle for Taapsee Pannu, 99 Homes (2015) about the 2008 US decided to expand what was meant to spinning off from her seven-minute recession. n
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