Nirbhaya Case Verdict - Challenges Ahead

Quite expectedly and welcomingly, the learned judge in the Nirbhaya case pronounced  “death to all” found guilty of committing an act that shook the entire nation, akin to the incidents like attack on our Parliament and the Mumbai attacks.

Quite expectedly again, there were voices from foreign office of UK, and from the EU, besides from Amnesty International which expressed their reservations against this sentence. But, we can choose to ignore the same, as our judicial process is not subservient to international opinion.

With due respects to the Hon’ble Court which pronounced this sentence, which has satisfied the collective conscience of our society, as was evident by the reactions of crowds eagerly awaiting the judgement, one wonders if this sentence would eventually be carried out?

To quote the learned Additional Sessions Judge, “Inhuman acts of torture before her death had not only shocked the collective conscience but calls for withdrawal of the protective arm of the community around these convicts. Accordingly, the convicts be hanged by the neck till they are dead.”

In its twenty page order, the Hon’ble Court said that the criminal justice system needed to instil faith in women by adopting a zero tolerance policy. The “severity” of the injuries and the “unprovoked” suffering inflicted upon the “defenceless” victim were also relied upon by the Hon’ble Court while handing down the Capital punishment.

Going by the past precedents in two cases involving a similar crime, it is observed that while Dhananjay Chatterjee was executed in 2004 for committing a similar crime, Santosh Singh a lawyer by training was spared the gallows by the Hon’b’le Supreme Court, and was made to serve a life sentence. He was held guilty of raping and then murdering Priyadarshini Mattoo. He had even disfigured her face beyond recognition.

In both the cases, the offence was identical with two key differences:

a)     Dhananjay Chatterjee was a security guard while Santosh Singh is a trained lawyer, and

b)    Dhananjay Chatterjee appeared to be unrepentant later, on while the Honb’le Supreme Court was convinced that Santosh Singh can be reformed.

One wonders, if a well educated person like Santosh Singh who was trained to aid the judicial process can commit such a heinous crime can be spared the gallows, ostensibly because of his so-called good behaviour in jail later on, then isn’t there a possibility that these four men do stand a chance of being spared the noose, if they too are perceived to be repentant later on, and on grounds of their young age, poverty, clean antecedents and other mitigating circumstances?

 Secondly, on a technical issue. The facts of the case clearly indicate that the intention of these four men was to inflict severe injuries on Nirbhaya and not to kill her. Else, they could have killed her before leaving the scene of crime, as in the two cases mentioned above. That she was left on the road with severe injuries is a vital fact that cannot be overlooked. This fact contrasts significantly to the Priyadarshini Mattoo case where the victim was killed later by her tormentor, who also disfigured her face beyond recognition before leaving the scene of crime. Going by the acts of savagery and cruelty inflicted on the victim, the depravity of this crime is no less significant as in Nirbhaya’s case.

My objective of highlighting these facts is not to plead for a lighter sentence to the four accused, but to caution the Special Public Prosecutor Dayan Krishnan and his team, of the challenges which lie ahead of them before death sentence is carried out. Yes, they certainly deserve our standing ovation for such a professional job which has earned them plaudits from across the Nation, but this is not the time for them to rest on their laurels.

And finally, according to the Hon’ble Court, for a case to fall under the “rarest of rare” category, perception of the society towards the offence was important. “The Court has to look into factors like society’s abhorrence, extreme indignation, and antipathy to certain types of cases.”

If this yardstick were to be applied to Priyadarshini Mattoo’s case, and to those life convicts who have been held guilty of similar crimes involving minors, then it would appear that the ends of justice have not been met in these cases. That would be really disturbing.         

                                        

Respected Chidambaram ji

Respected Chidambaram ji,

 The budget making exercise always challenging, especially at a time when the overall economy is not its pink of health, there exists a real threat of being downgraded to junk status by the international credit rating agencies due to high fiscal deficit, and to cap it, this being a pre-election year. Even though the budget is not the only instrument for effecting overall economic development by the government in the forthcoming financial year, as there could be ‘n’ number of announcements time to time which can have significant bearing on our economy, yet it is the most important instrument to steer the economy in the financial year ahead.

 Even though you had very little elbow room to avoid presenting a populist budget, yet you deserve full marks for gambling on good economics, in the expectation of reaping political dividends later on. You have pegged the fiscal deficit to 5.2% of GDP in this financial year, and 4.8% in the next financial year, and yet you have been bold enough to provide for a 29% increase in plan spending in the the forthcoming financial year. Certainly, this rise in the plan spending is based upon the assumption of very high tax collections to fund the proposed plan spending. To be specific, against a nominal GDP growth of 13.4% it is hoped that the tax revenues will rise by 19 %, a very optimistic estimate indeed. Let’s leave it for the next year to evaluate the actual outcome.

 While there can be no budget which can please each and every segment of our country, and despite doing an excellent job given your constraints, yet I find it tempting to make the following observations for your kind consideration and implementation as and when you deem appropriate:

 Widening the tax base

  You had stated in your budget speech, “When I need to raise resources, who do I go to except those who are relatively well placed in society?” According to your estimates, there are 42,800 individuals in the country whose taxable income is Rs. 1 crore or more per year. You have levied a temporary surcharge of 10% for a year for such super rich.

Theoretically, there is no dispute over the principle, that better-offs should contribute more as compared to others to the state’s exchequer. But, let’s not forget that such super rich also have the privilege of eliciting the services of some of the best tax planners who can bail them out through some creative accounting techniques, thus negating the very idea of such surcharge. Besides, this figure of 42,800 is debatable if we were to include the rural sector as well.

 There could be equal number of such super rich in the rural sector, who do not contribute a single rupee to the state’s exchequer, but are enjoying all the subsidy related benefits. It’s high time that we expanded our tax base by getting such individuals within the ambit of income tax. To make it politically saleable, may I suggest that a Rural Development Fund be created, and all the tax contributions by such super rich farmers, be pooled in that fund with a matching grant from the relevant states and a proportionate percentage by the Centre? This entire corpus should then be exclusively used to create the required infrastructure in the deserving rural areas.

  Employment Generation

 This surcharge of 10% has also been levied on those companies whose annual taxable income is Rs. 10 crores and above. Corporate income tax, the largest contributor to the exchequer fell nearly 4% short of the target set by your respected predecessor Shri Pranab Mukherjee. In rupee terms, this shortfall amounted to Rs. 14,353 crores. What saved things to an extent were taxes on individual incomes and services, which narrowly crossed the estimated targets.

To manage the fiscal deficit target, plan spending had to be slashed in a big way, thereby worsening the quality of the deficit. Given this scenario, it would have been worthwhile to reduce the corporate income tax in inverse proportion to the amount of TDS generated by a company through its regular employees’ salaries.

This would have been an excellent way of boosting employment across industries, something which our economy is struggling to achieve at present. Yes, you have provided an incentive to spend for some manufacturing units by allowing 15% of spending over Rs. 100 crores on plant and machinery in the next two years, qualifying as a deduction. But this benefit can be obtained only by those corporates who have deep pockets and most importantly, can justify the same commercially.

 Indigenization of Military Hardware

  Our defense budget has been raised to over Rs. 2 lakh crores, as we cannot afford to compromise on the overall security of our nation. But considering the fact that we are the biggest importer of military hardware, having spent around $50 billion in the past decade on such imports, it is indeed surprising that no serious thought has been given to boost our own military hardware industry to acceptable international standards, thereby saving such mammoth outgo of foreign exchange, and some years down the line transforming ourselves from the biggest importer to one of the leading exporters of military hardware.

 Specifically, what was required in this budget was a five year tax holiday for all companies engaged in the production of military hardware, besides creating a sizeable corpus, from which highly subsidized loans could be granted for R&D related activities to such entities. If such a move yields the desired results, then some years down the line we could rival China, where foreign exchange reserves are concerned. This would boost the value of the rupee which in turn would cut down our crude oil imports bill in rupee terms thereby further extending us benefits in terms of manageable fiscal deficit.

 Setting up of Cold Storages etc for our Agro based Industry

  Your government staked its survival over the issue of FDI in multi-brand retail, and your spokespersons sold the idea on the basis of a pressing need to plug the estimated 40% wastage of fruits and vegetables due to inadequate cold storage and other facilities in the entire supply chain, besides ensuring a fair price to the farmers and the end consumers by removing as many intermediaries as possible.

 It is a great idea indeed. But what has surprised some of us is the absence of any tax related concessions to our own entities desirous of entering into such businesses.

 Women Welfare

  Nirbhaya Fund to the tune of Rs. 1000 crore has been proposed for the security and improvement of women, besides an all women Public Sector Bank with a corpus of Rs. 1000 crore especially to cater to various needs of our womenfolk While there is no dearth of Public Sector Banks in our country, there are also some women cooperatives banks as well which cater to the desired objectives.

 Hence, it would have been better if the same total corpus of Rs. 2000 crores had been allocated for strengthening our judicial system to dispense quicker justice, which would have been a better way of ensuring security and empowerment of our womenfolk.

 Alternate fuel based technologies

  Given our heavy dependence on imported crude as well as our commitments towards reducing global warming, there is a pressing need to develop automobiles on a large scale which use renewable energy. As a thrust on the same, tax holidays for such companies which are currently producing cars which can run on electricity or any other alternate fuels, and a substantial corpus be created through which loans on highly subsidized rates for such R&D can be dispensed to such entities.

 Disinvestment

  Your government has set up an ambitious target of mopping up Rs. 56,000 crores from the sale of PSU shares, pointing to increased reliance on disinvestment to bridge the deficit. This target is for the next financial year, and is more than double that the government plans to mop up during the current fiscal. It includes the residual stake in Balco, Hindustan Zinc, besides MMTC and BHEL. All these are blue chip companies. Is it necessary to “sell family silver for covering one's debt”?

Certainly, this deficit once bridged through stake sale is likely to resurface some years down the line, given the competitive populism which is hall mark of our polity. Kindly explore ways to make such blue chip PSUs more profitable thereby generating more dividends for the government, which then can be used to bridge the deficit gradually. Removing unnecessary government interference in their functioning besides the requisite autonomy and accountability to its senior management could be among some of the measures you might consider for all the PSUs and the dividends so generated would be amazing indeed.

Misuse of Subsidies

 And finally, every year huge amounts are being earmarked for various subsidies. While reduction in subsidies is politically sensitive, yet a strict monitoring of its end use is fiscally prudent. In this connection, may I draw your attention to the decision of IFFCO Board to grant a special incentive of two of its prime properties in Delhi with 40-50 crores each as per media reports to two of its top honchos. According to the news item, IFFCO's 2011-12 annual reports, it received Rs. 14,464 crores or 57% of its turnover of Rs 25,600 crores as government’s subsidies for fertilizers.

According to a press released by the company the following day, IFFCO maintained that the government had no stake in IFFCO and hence those two properties did not belong to the government. As for the lavish subsidy amount of over Rs 14,000 crores or 57% of its turnover that it gets from the government, IFFCO said this was only as per the government policy of compensating fertilizer companies for selling at a loss. If that be so, then how come the company was so generous to gift two of its prime properties worth a combined 100 crores or so to two of its honchos?

This is just one classic case of gross misuse of subsidies by entities like IFFCO. This may also be just tip of the iceberg waiting to be discovered by your administration. Why should we tax payers pay a portion of our hard earned money to facilitate such generous payouts by such irresponsible entities?

 Kindly consider these observations accordingly, and wishing you all the very best in your endeavours.

Respectfully,

Navneet Dhawan

Europe and Iran - Possible Solutions

The two key issues which are keeping the world leaders on 'tender-hooks', are the European crisis and tensions with Iran over its nuclear programme. Even if one of these spirals out of control, the consequences for the entire global economy would be catastrophic, with even worse consequences for the states involved.

In Europe, some of the member nations are saddled with excess debts and are virtually on the verge of a default. The ‘standard medicine’ so prescribed for such ‘ailments’ include debt restructuring, which essentially entails writing -off apart of it, followed by austerity measures to bring about the much needed fiscal discipline. While prima facie, such a ‘medicine’ would have its own merits considering the background of the crisis, yet it could also lead to terrible ‘side- effects’, if administered the wrong way.

While learned economists and enlightened political leadership are likely to ‘prescribe other remedies’ as well to the ‘ailing countries’ of Europe, the basic objective of any policy prescription sought to be finally administered should be:

a) Ensure that the write-offs are fair, and do not cause unacceptable damage to the affected entities, while the balance restructuring of the debt is realistic, considering the overall long-term resilience of the economies in question,

b) Cut wasteful government expenditure, that is, such expenditure, which if eliminated completely or downsized significantly, would not disturb the social order too much, and/or adversely impact the overall productivity of the economy, and

c) Direct significant part of the bailout funds to facilitate better economies of scale for private enterprises to produce quality goods or services at highly competitive costs. This would eventually lead to increase in the employment generation, increase in the revenue for such governments through taxes, besides of course adding to the foreign exchange earnings for such economies as well.

Yes, in the short-run the ‘side- effects’ could include inflationary pressures due to increased spending without commensurate increase in the productive capacity of such economies, besides some other pains as well. But such ‘teething problems’ would surely pale into insignificance when compared with the likely catastrophes which could unfold, should there be in- orderly defaults by some of the key member nations of the European Union. Such a nightmarish scenario which is being avoided at all costs, going by the efforts of the European leaders.

Coming to Iran, it can score a diplomatic coup besides other gains as well, if it meets the concerns of the United Nations regarding its suspected nuclear programme, and as a quid pro quo, works out a ‘nuclear umbrella’ with Russia or any other permanent member of the UNSC with which it shares a comfortable relationship today. Such an ‘umbrella’, could guarantee security to Iran in event of any nuclear strike on its soil, or in case of any attack on its nuclear facilities.

Certainly, the essence of jasmine revolution besides its own current internal woes, should not be lost on the Iranian leadership, whose aggressive posturing on the Strait of Hormuz, smacks of a misplaced and ill–timed adventurism.

High Moral Ground Vs National Interests

The UN General Assembly has overwhelmingly approved a resolution condemning an alleged plot, blamed by the US on elements in Iranian establishment to assassinate Saudi envoy to Washington, and asked Tehran to cooperate in the probe.

The resolution did not directly accuse Tehran of carrying out the plot, but it called on Iran “to comply with all of its obligations under international law, including the Convention on the Prevention and Punishment of Crimes against Internationally Protected Persons, particularly with respect to its obligations to provide law enforcement assistance.”

This resolution received one hundred and six votes in favor, and nine votes against, while forty countries abstained.

Quite surprisingly India, which currently occupies the Chair of UN Security Council’s counter terrorism committee, abstained.

Our permanent representative to the United Nations, Mr. Hardeep Singh Puri said, “We have abstained on the resolution, as its substance deals with a specific case in which we are not in the possession of full facts and the mater is subjudice.”

This statement fails to convince any rational thought, as to how a country like India, which has been a victim of state sponsored terrorism for more than two decades, fail to support a resolution which merely calls upon a State to comply with all of its obligations under international law?

True, we may not have been in full possession of facts of the case, and matter was subjudice, but then what facts are required to impress upon a State to comply with all of its obligations under international law?

The specific case in question pertains to an attempt to assassinate Saudi envoy in Washington DC. Can any State in the world which genuinely condemns terrorism, afford to ignore the severity of the case?

Certainly, not all the one hundred and six countries which voted in favor of this resolution could have acted irrationally, if Mr. Puri’s defense is to be accepted as a rational justification for our abstinence.

Yes, this is yet another manifestation of our ‘weak kneeled’ foreign policy, which prevents us from taking the high moral ground even in such important intentional forums, because our national interests cannot be compromised at all. That we are looking at Iran for ensuring our energy security is only to well known.

But then, should we trade it off with something as critical as our uncompromising stand on terrorism, and develop ‘cold feet’ even where a reasonable demand is made on State such as this particular resolution on Iran?

President Obama's Proposed $447 billion Jobs Plan

President Obama's proposed $447 billion jobs plan to revive the US economy can succeed only if the Americans demonstrate an increased propensity to consume subsequently, thus providing the necessary impetus to boost the aggregate demand in the US economy. The multiplier effect of this increase in private consumption with its spill over effects in Investment demand could set the direction for a substantial decline in the unemployment rate which currently is over 9%.

For this the Americans need to feel secure about their jobs in particular and their economy in general. The likely opposition by the Republicans to this proposal, perhaps due to the impending elections next year are likely to heighten the sense of insecurity among the Americans, while the US economy continues to be in tender hooks.

The need of the hour for President Obama is to demonstrate statesmanship by getting the Republicans on board in a spirit of accommodation, and work out a mutually acceptable jobs plan, which would not be altered should there by change of guard at the Whitehouse next year. It would not be surprising if this initiative also helps US regain its topmost credit ratings, downgraded by Standard and Poor recently.

In this context, his dig at the Republican opponents to “stop the political circus and actually do something to help the economy” was unwarranted.

It's Time to Reflect

While the ‘Anna phonomenon’ has taken the country by storm, as we the people of India quite understandably are fed up with this ‘mega monster’ called corruption, yet it is time for each one us to reflect upon the following:

a) Anna ji and his core team need to set an example for each one of us, by taking an oath in public, that we would not bend any rules, or violate any law of the land, and if we do unintentionally or otherwise, we would face the consequences, as dictated by the law of the land. No matter what the temptation might be, we would not try to bail ourselves out, by bribing the authority in question,

b) The current impasse is over the Lok Pal bill Vs the Jan Lokpal bill. Would Anna and his core team, care to educate citizens like me, as to how would the latter make our lives any better as compared to the former, besides enabling our country to progress much better?

c) “I have faith in the parliament but not in the elected representatives of our parliament”. Would the orator of this statement care to explain to citizens like me that, what is left of our parliament, if we were take out our elected representatives? Secondly, it was shocking to say the least, to witness members from the opposition, launching an all out attack on the government in both the houses of parliament yesterday. The timing was pathetic. This is the time for all the existing parliamentarians to come to together and seriously debate as to how to we can further strengthen this key symbol of our democracy, which is our parliament,

d) The nation today faces tremendous challenges in terms of growth, and bold policy decisions need to be taken at the executive level, which need to be implemented by the bureaucracy. With such kind of frenzy, it is no secret that the entire governance is being held hostage, and hardly anyone in the government and bureaucracy is bold enough to put his signature on the files, without any fear of being subjected to undue scrutiny, even if he/she commits a genuine mistake. Now, how can we expect all round prosperity and progress, by growth in job opportunities, increase in our national income, besides being able to create confidence in the world community, that India is an emerging economic superpower? and finally

e) Having made his point so forcefully, isn’t it time for Anna ji and his core team, to now work with our government, respecting the key institution of our democracy, which is our Parliament, which has been vested with the sole authority to frame laws for the nation? Whose cause is he espousing by literally holding the government to ransom? Aren’t those who are hostile to our national interests rejoicing over this unprecedented impasse? And above all, does he expect to set a dangerous precedent now, which seeks undermine the supremacy of our Parliament, where framing of laws are concerned?


It’s time to reflect.

An Open Letter to President Obama

Your Excellency,

I am pleased to introduce myself as an ardent admirer of your good self, and am based out of New Delhi. This letter of mine has been prompted by your appeal to the American lawmakers to end their bickering and come to an agreement over raising the country’s debt ceiling so that the US government can pay its bills.

As of this moment, the world economy waits with a baited breath, over the outcome of your efforts, to avert an impending economic catastrophe for the United States spilling over to the rest of the World, and we sincerely hope that saner counsels would prevail among the American lawmakers to work out a practical solution to the current challenge confronting the United States.

It would be extremely disastrous to ignore that, even if you are able to raise the debt ceiling beyond the currently mandated $14.3 trillion, would you be laying the foundations for yet another catastrophe for the US Economy a few years down the line, when it would might grappling with spiraling inflationary pressures, jobless growth, and a significant erosion in the value of US Dollar?

While there could be no two ways about the need to raise the US Debt ceiling today, to effectively meet the challenge on hand on a timely basis, yet it would be dangerous to lose the sight of prudence which ensures that for one, you are not repeating the past mistakes of unbridled consumption fuelled by easy money, and secondly for every dollar that is being released into the system today, at least half of it is being spent to improve the productive capacity of the economy with sufficient linkages to create sufficient jobs, and arrest the ever bloating fiscal deficits.

Unfortunately, I am constrained by my limited knowledge to give a detailed account on the specifics of such linkages. However, at a very elementary level, may I suggest that such linkages could be:

* reducing oil consumption by encouraging Research and Development of alternate fuels, which are both renewable and environment friendly,
* focusing on creating better infrastructure to facilitate the private sector to expand output and employment in the most cost effective manner, and
*most importantly, sponsoring the development of various environment friendly technologies which could have their own spin-off effects in the future.

In this context your $150 billion new energy agenda which aims to reduce the greenhouse gases by 80% by the year 2050, besides of course creating five million new jobs, is certainly in the right direction which would give the US a leadership position on facilitating the desired climate change in the world.

Apart from the technologies which could help tackling the challenge of global warming and reducing oil consumption etc, technologies to efficiently and effectively harness the rainwater could be an excellent investment for the future.

Today it is oil, and tomorrow it could be potable water, which could become a major source of foreign exchange earning for any country.

The second manifestation of the challenge before us is to revisit the old school of thought, which necessitated sufficient checks and balances in any economy, with stringent punishments to deter any financial institution daring to throw all caution to the winds, and then causing unmitigated disaster, as was witnessed few years ago. A highly regulated capitalist society need not be an oxymoron, and today few would have the wisdom to contest this fact.

However, given the roots behind the problems today, which is chiefly the fact that living beyond one’s means and lending beyond one’s means, had become a way of life encompassing not only an average US citizen, but also those iconic corporations which were once a cherished destination of many bright students of some of the leading business schools of the world.

This has to change, not only in the US, but perhaps across the economies in the world which are today engaged in a similar fire fighting exercise.

Your Excellency, just a few hours back, you have put it aptly by cautioning the lawmakers that “America risked its AAA rating not because we couldn’t pay our bills but because we did not have a triple A political system.”

While your intention was to push the lawmakers to agree raise the country’s debt ceiling, so that the US government could pay government salaries and pensions, reimburse medical care for seniors etc, yet the ‘not so intended’ message behind this statement of yours is:

“Its now time for all of us regardless of our political affiliations, to work together, to get the United States of America out of this mess. We need to take tough measures to contain the ever burgeoning debt which has now crossed the $14.3 trillion debt ceiling. This is not the time for each patriotic American irrespective of his or her political affiliations, to score political points at the cost of our Nation which today is being hailed as the sole superpower of the World, but to sink our differences and evolve a consensus to pave the way for an era when the US Dollar would be most preferred currency across the world, and the US economy would a model to behold for every emerging and/or troubled economy of the World.”

And in this hour of reckoning, your message to the people of the United States of America should be:

“We owe it not only to ourselves, owe to our future generations as well, not to repeat the mistakes which brought us to this stage in the history of our nation. We will change our mindsets; we will be an epitome of a nation worthy of being emulated across the globe. Not simply because of the fact that we are the most powerful, not simply because of our influence across the globe and beyond the globe in the universe, but simply because of the fact that we the people of the United States of America, know how to manage our lives and our economy better. The path is likely to be difficult, testing, and full of frustrations. But we will endure the same, for we know that a dream destination awaits all of us, at the end of this path. We will reach there.”

Your Excellency, let history judge you as the first President of the United States, who not only broke the barriers of race, but who successfully forged a collaborative approach with the opposition party as well, to pave the way for an economically vibrant US Economy, and sacrificing politically favorable practices and attitudes, which otherwise could have wrecked havoc not only for the US Economy, but also for the millions of Americans, who had reposed their trust on you in 2008.

I would also pray the current challenge regarding the debt ceiling ends with the right decision within the deadline, and would be really delighted at witnessing your re-election next year.

Most Respectfully,

Navneet Dhawan

New Delhi