Editorial 1
Editorial 2
Zones and phones
Letters to the editor


Uncivil Aviation

There was nothing remotely grand about this alliance. Alliance Air CD 7411 was the scene, recently, of a rare moment of unanimity achieved by 27 members of parliament from Bihar when they rose above partisan divisions to forcibly divert the Lucknow-bound aircraft to Patna. This jot, in spite of its shockingly uncivilized behaviour, proved remarkably successful in implementing its agenda. It managed to coerce the pilot into landing the aircraft in Patna, violating the airport’s security deadline. This callousness regarding the security of the other passengers was allegedly authorized by the Union civil aviation minister, Mr Sharad Yadav. Vilely abusing his way into using his cellphone in the aircraft, the Samata Party MP, Mr Prabhunath Singh, reportedly called up Mr Yadav to arrange for the ministerial sanction. This was granted quite promptly.

The co-passengers, crew, airport officials and airlines personnel, deeply inconvenienced and incensed by this misbehaviour, have given extensive accounts of their experience. But denials and equivocation already obscure the events in and around CD 7411. There are now conflicting accounts of the nature and degree of ministerial intervention in what could be established as amounting to a collaborative criminal offence. And this is precisely what needs to be established beyond doubt. There has to be a proper inquiry — speedy, objective and unsparing — made into the matter. Its findings must then be the basis of the law taking its own course with those who are proven guilty. There are at least three counts on which such an inquiry is imperative. First, forcing the plane to land in Patna after the airport’s security deadline, and in full knowledge of such a stipulation, could amount to putting the lives of those on the plane in jeopardy. But the situation also brings up the question of the abuse of consumer rights. The offensively cavalier attitude displayed here towards the danger and inconvenience of those who have paid to be at a certain place within a certain time in a certain standard of comfort calls for an official reparation. The Uttar Pradesh principal secretary (health), Mr V.K. Diwan, who was on the flight, has rightly threatened to approach the consumer forum. But his sense of hopelessness in anything coming of this speaks of the people’s instinctive mistrust of such tribunals’ immunity from the gross political clout exercised by their representatives in Parliament. There is, apparently, a history of such interventions, complaints against which from airline officials invariably go unaddressed. And this is perhaps what is most despicable about the entire incident: the unabashed abuse of power that could subvert every norm of civilized, responsible and democratic behaviour to achieve the crudest of self-serving triumphs.

That an essentially undemocratic culture of abuse has led to the pervasive corruption of professional ethics within civil society was demonstrated, yet again, in the recent experience of the chief justice of Delhi high court, Mr Arijit Passayat. Mr Passayat has managed to persuade the court to take a serious view of Indian Airlines staff giving special treatment to politicians at the expense of other passengers. The court has been urged to take suo motu action against the offending personnel and Indian Airlines has ordered an enquiry into the chief justice’s allegations. The abuse of political power affects the daily lives, safety and rights of most Indian citizens. Unfortunately, most of them are not privileged enough to be judges or bureaucrats.    


Deathly Tales

Horrifying tales of violence have become everyday fare. Even then, there are some incidents that are outrageous in their cruelty. The death of the 10 year old girl by stoning in Barabanki district in Uttar Pradesh exposed deliberate and violent cruelty, not only in the two housewives who carried out the killing, but also among the villagers who stood around, quietly watching the girl die. Recently, Calcutta witnessed an incident in which people beat up and killed a teenager who was being chased by the police for a traffic rule violation while the police stood by, watching. The two incidents are very different in detail, yet the basic phenomenon, the uncontrollable desire to inflict violence and enjoy the spectacle, is alarmingly similar.

The police superintendent of Barabanki feels there is a lot of latent violence among the people of that area, generated by an economy which revolves around opium and a culture which measures power in terms of firearms. Yet the horrific act, in which a little girl was stoned to death because she chased her uncle’s cow into a neighbour’s field, is itself proof that socio-economic explanations may be relevant, but not enough. Else the policemen of that crime-hardened region would not be as shocked as they seem to be. Surroundings are certainly important. And violence breeds violence. The state of UP today is simmering with barbaric acts, whether the violence be directed against Christians, or nongovernmental organizations or underprivileged castes. Quite often, the perpetrators comprise one of the arms of the state — allegedly the police killed a Dalit family in a UP village recently — or outfits confident of the invisible backing of the powers running the state. So it may not be surprising if the less powerful and the more frustrated give vent to unthinking hatred. But local explanations will no longer do. The inhumanity being manifested is not limited to UP. It is important to recognize that a desire for violence has been unleashed among people throughout the country. Only by recognizing this can the long way back to civilization be rediscovered.    


Among the key economic areas that New Delhi needs to address to maintain the pace of economic reforms is promoting exports and information technology.

The government needs to promote exports by stressing export processing zones, eliminating product reservation for small scale industry, encouraging the information technology sector, eliminating administrative barriers to foreign direct investment, and abolishing tax and tariff structures that are biased against exports. India could have achieved what China has achieved in export growth. However, India failed in basic policy strategy.

At the centre of China’s strategy were the special economic zones in which favourable export conditions were assured. SEZs were designed to give foreign investors and domestic enterprises favourable conditions for rapid export promotion. All aspects of the export environment were secured. Exporters were allowed to import intermediate products and capital goods duty free. They were given generous tax holidays and assured decent physical infrastructure. This was done by providing land, power, physical security and transport to ports within special industrial parks.

India too has experimented with similar zones, but India’s approach has been one of relative neglect. China’s five main SEZs have been successful in exports, attracting FDI and creating large scale employment opportunities. By contrast, India’s main export processing zones have not succeeded in any of these areas.

India’s EPZs have not performed as well as China’s SEZs for many reasons. They have been of limited scale and are overcrowded. India has built insufficient logistical links with ports. Infrastructure near the zones has been poor with unpaved roads and poor physical security. There is still much government ambivalence and red tape regarding inward FDI, as well as unclear incentive packages about inward investment. State and local governments, even the private sector, lack sufficient authority and interest in the design, setup and functioning of the zones.

In China, the major responsibility for the SEZs rests with local and provincial governments. In India, the responsibilities lie heavily with New Delhi. Under these circumstances, many state governments are actually averse to locating EPZs in their state. Some of the initiatives announced by the government in the export-import policy 2000-01, such as establishing SEZs in different parts of the country and fully involving the state governments in the export efforts, are welcome. While these measures will undoubtedly provide great impetus to India’s export efforts, it is critical to abolish product reservation for small scale industry and to liberalize labour laws if India is to attain and sustain high rates of export growth.

India’s labour laws make it costly to dismiss workers in enterprises of more than 100 workers. The result is that formal sector firms are loath to take on new employees. The vast majority of India’s employees remains informal, in small, tax evading, inefficient enterprises.

Remarkably, India’s legislation continues to restrict the entry of large firms, or the growth of small firms into large firms, in several areas of potential comparative advantage. Thus garments, toys, shoes and leather products continue to be reserved for small scale producers. India’s high overall tariff rates, especially tariffs on intermediate products used by exporters, impose a heavy indirect tax on export competitiveness.

Furthermore, the budget for 2000-01 proposes phasing out exemptions from income tax for export earnings. The regulatory attitude to foreign direct investors, potential engines for India’s export drive, continues to be ambivalent. The government promotes FDI on the one hand, but then regulates against full foreign ownership and maintains lengthy approval processes, on the other hand.

Service sector export based on infotech is another area where government policy could do much more to spur export growth. India is becoming one of the world’s most important infotech players. It is the fastest growing foreign exchange earner. The government could do more for this industry, not through direct subsidies, but through the liberalization of telecommunications, allowing for lower priced telecom services and the entry of major international players.

These companies could lay down a tremendous fibre optic network in India and increase the bandwidth available for business. This would push India even closer to the international scene. New Delhi should find some resources to support basic science and research and development in this sector. India has world class engineers and scientists who have already brought India up in an important way in this sector and could keep India in the forefront of this new technology.

The continuing state monopoly of Videsh Sanchar Nigam in international telephony as well as in internet provision within the Indian market seriously raise the costs of telephone and infotech services in India. It is doing considerable damage to India’s international competitiveness in the infotech sector. In addition, India’s telephone density is abysmally low, at around 1.3 lines per hundred persons in 1995.

International telephone calls originating in India are among the most expensive in the world, largely due to lack of competition. Physical infrastructure for data transmission within India — for example, fibre optic cables — remains underdeveloped despite some recent progress. Restrictive policies on FDI have kept international chipmakers out of India, and have indirectly raised the prices of personal computers in the Indian market. The lack of enforcement of intellectual property laws most likely inhibits inward investments in infotech sectors.

All of these problems are remediable through further deregulation of telecom and FDI, as well as effective law enforcement in a more liberalized and competitive environment.

The engine of growth of the booming infotech sector is the software industry which has grown at an average annual rate of 60 per cent between 1992 and 1999. The turnover of the Indian software industry, which employs 160,000 professionals, has zoomed from a mere $ 20 million 10 years ago to four billion dollars in 1998-99, of which $ 2.6 billion was exported. This industry has clearly emerged as a major export earner for the country, contributing eight per cent of total merchandise exports. It has also achieved worldwide reputation for providing excellent quality. Many local software firms have earned International Standards Organization 9000 certificates. They have also gotten the Software Engineering Institute’s capability maturity model certification, with five of them having reached level five. Only nine firms worldwide have reached this level. India has achieved this feat by leveraging its most valuable resource: highly skilled manpower.

Improvements in infrastructure through liberalization combined with regulation are needed. In telecom this should be done through privatization and competition. In power, reforming the state electricity boards is extremely crucial. Liberalizing telecom would allow for lower priced services and letting in more major international players could raise Indian infrastructure to international levels.

Jeffrey Sachs is professor of international trade, Harvard University, US. N. Bajpai is director, India programme, Centre for International Development, Harvard University    


Never out of school

Sir — Children today have no respite even during summer vacations. Gone are the days when they would relax and have a few days off from the burden of the school curriculum. Today, they are facing an uphill task living up to their parents’ expectations, so that even summer holidays have come to mean a period when they have to participate in some workshop or the other (“School’s Out”, May 20). These workshops are just another way of making children “learn” acting, painting, dancing, gardening and so on, like swallowing a set of sugared pills — and are, in effect, no better than regular classes. Such workshops are fast becoming the latest fad for parents. This is merely an extension of classroom teaching in the garb of relaxation and fun. Given a choice, all that the children themselves would probably opt for, is having pure, unalloyed fun with their parents. Would not the “learning process” be more fun if generated by parents? Have guardians given enough thought to that?

Yours faithfully,
Sreela Sen,

The limits of intervention

Sir — The 1987 intervention in the civil war between the Tamil and the Sinhalese in Sri Lanka was an expensive folly for both the former prime minister, Rajiv Gandhi, and for India. The Sri Lankan government very shrewdly got the Indians involved and then saw to it that the Indian peacekeeping force was kicked out by the Tamils themselves. Intervening in Sri Lankan affairs again would only be a repetition of that blunder. Hundreds of thousands of Sri Lankan Tamils are already pouring into India, just as hordes of Bangladeshi Hindus and Muslims turned to India when Pakistan launched a genocidal attack on Bengalis in 1971. Indira Gandhi was forced to impose a special tax to raise the resources so that the needs of the millions of refugees could be met.

Actually, there does not seem much wrong with Tamils seeking a separate state. After all, Cyprus, which is far smaller than Sri Lanka is divided into a Muslim north (supported by Turkey and other Islamic countries) and Greek Orthodox Christian south. The Sri Lankan Tamils richly deserve a state of their own given the discriminations and deprivations they have been subjected to by the Sinhalese-speaking majority. Many countries like Slovenia and Slovakia are far smaller than the proposed Tamil state to be carved out of Sri Lanka. But this is a matter that should be resolved by the Tamils and Sinhalese using the offices of whosoever enjoys the confidence of both peoples.

As far as India is concerned, both the Tamils and Sinhalese belong to the same race and culture. However, if Pakistan is invited to intervene in Sri Lankan affairs, then India would be justified in denying to mediate as India cannot allow forces inimical to it to get a foothold in its immediate vicinity.

Yours faithfully,
T. Mani Chowdary ,

Sir — Sri Lanka’s ethnic conflict has become a nightmare not only for its government but for India as well, going by the reactions of Tamil Nadu’s chief minister. M. Karunanidhi’s statements must be seen in the light of the latent sympathy within Tamil Nadu for their Sri Lankan brethren and made with an eye to the coming assembly elections. As usual, politicians have started playing to the gallery in the game of oneupmanship. India needs to tread carefully since the Liberation Tigers of Tamil Eelam chief, V. Prabhakaran, cannot be taken lightly. Prabhakaran developed an animosity against Rajiv Gandhi during 1985-87, as he was confined in New Delhi at the latter’s behest, and was thus determined to teach him a lesson. The rest is history and but for the photographer, Babu, Rajiv Gandhi’s assassination would have remain unsolved and a mystery.

The bitter lessons of the IPKF are still fresh in public memory. Soon after arriving in Sri Lanka, the IPKF found themselves fighting against the Tamil Tigers, while the Sri Lankan army had the last laugh. Indian Tamils were hurt and to add fuel to the fire, pamphlets were spread showing the role of both the IPKF and Rajiv Gandhi as totally unjust and wrong. The government would do well to keep out of the matter, except for providing humanitarian aid. However, if a situation develops wherein other countries start meddling in Sri Lanka’s affairs, then India should move in first as mediator between the rivals and then as arbitrator, if asked.

Yours faithfully,
Jitesh Sonee,

Sir — The Central government is right not to send the army to Sri Lanka as it had in 1987. There is no point burning our fingers by interfering in the internal affairs of neighbouring countries, and the southern allies of the Bharatiya Janata Party are right to make this point (“South-stung Delhi in Lanka retreat”, May 5). It is commonly accepted that sending the Indian peacekeeping force to Sri Lanka in 1987 was a mistake, diplomatically and militarily. Thousands of Indian soldiers were killed or wounded. Millions of rupees from the public exchequer were allowed to run down the drain in a futile effort to prove our military strength. However, the army failed and had to retreat, causing a severe diplomatic jolt to the country. The myopia of Indian leaders, that has time and again let the country down, should not be repeated. India is itself a poor country, ranking among the three largest borrowers from the International Monetary Fund and the World Bank. It’s economy is in the doldrums and it is itself plagued by terrorist attacks in Kashmir and elsewhere. Under the circumstances, it should not venture into any area that would further harm its economy and show its diplomacy in a poor light.

At best, India can help Sri Lanka evacuate the 30,000 trapped soldiers in Jaffna, provided Sri Lanka foots the bill. India, Sri Lanka’s closest neighbour and a dominant member of the South Asian Association for Regional Cooperation, cannot ignore its appeal for help. India has pledged humanitarian aid, but what could be more unhumanitarian than the 30,000 soldiers being left to fend for themselves and being butchered by the LTTE guerrillas?

Yours faithfully,
Santosh Kumar Sharma,

Conflict in the air

Sir — With reference to “Court restraint on Sahara directors” (May 16), Sahara Airlines had taken three aircraft from PLM Transportation Equipment Corporation for five years, 13 months and three months, respectively. The first aircraft was signed by Sahara on August 2, 1993. These aircraft have since been accepted by PLM in flying and serviceable condition. The quantum of lease, rental, and so on, paid to PLM during this period is over $ 10 million.

The Reserve Bank of India did not approve of the guarantees required by PLM. PLM were duly informed about the nullity of the guarantees under section 24 of the lease agreement, which clearly stipulates that any provision of the lease which is prohibited or unenforceable in any jurisdiction, shall be ineffective to the extent of such prohibition. PLM was aware right from the inception that in the event of the RBI refusing to issue guarantees, the issue stood null and void.

The present dispute mainly relates to return conditions. Arbitration proceedings are in progress in California. Obviously, PLM’s strategy seems to be to bypass arbitration in the United States after having invoked the arbitration clause themselves, and instead take recourse to court proceedings and create pressure on us in India through adverse publicity.

This suggests that PLM is not confident in its claim before the arbitrator in the US and is bent on creating adverse publicity against the good image of Sahara with unethical inclination and dishonest tendency. Sahara Airlines has the highest regard for the judiciary and arbitrators and the award of the arbitration will be honoured and accepted by Sahara Airlines.

Yours faithfully,
Sameer Bhargava, Controller,
Sahara Airlines, New Delhi

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