The Multi-Million $ Future Of Digital India

The Multi-Billion $ Future Of Digital India

It’s not just because Reliance Jio, the $15 billion investment off the Reliance cash balances, just launched, has made an aggressive pitch towards instant market leadership.

Jio is offering free ‘voice’, while charging for data usage, the real revenue McCoy, but in small chunks, for little money, so it doesn’t pinch.

In the end, Jio won’t take in less in aggregate, but will do so with better lures.  Will it appropriate Modi’s Digital India vision unto itself? Well, the backbone of it, could well be the smartphone, unless someone comes up with a better widget.

It’s clever stuff, this battle for the concept definition itself, but is cellular telecom the lion’s share of it?

Jio will need 80 million subscribers paying at least Rs. 180 per month in usage fees for it to break-even. However, the 60 year old Mukesh Ambani says he’s not going to lose money on Jio for sure.

Others are grudging the flood of interconnectivity they have to provide the new Jio riders, but, as the man says, for how long? It’s illegal to refuse.

The notion that the smartphone will rule the bandwidth is fuelled and reinforced by the Mobile App, the medium through which a lot of digital traffic/eCommerce is growing, rather than via the older laptop/tablet formats.

Even if mobile telecom isn’t synonymous with Digital India, the internet certainly is; and 3G, 4G and 5G speeds, plus fibre-optic cabling, will continue to batter down the dimensions of both time and distance.

Money, they say, never sleeps, but neither does the eCommercial marketplace. It is awake for the insomniac, and never takes a day off.

Jio could well be the blockbuster service provider, given the potential of the Indian telecommunications market. It already boasts over a billion cellphones in use, many of which are voice only.

Older people tend to be technology averse, but India is 65% between the ages of 15 and 35, and this ‘demographic dividend’ will pay out for at least three decades more.

The smartphones today range from the rapidly bundling features and upgrading inexpensive variety, to the more aspirational, not so cheap ones.

People are consuming entertainment, data, advertising, news, views, music, photos, videos, all on their devices.

They are receiving tax returns, banking information, governance, subsidies, payments, surveillance, quite often on the move.

And people are forever upgrading to more, for less. Even the defence of the realm depends on it. Corruption is being curbed via the direct interface between senders and receivers. It cuts out the rent-seeking middlemen.

eCommerce already dominates air/train/travel and hotel/car bookings, offering tighter rates and fares. The entire travel agency business has morphed into eTravel. It now accounts for 70% of the entire caboodle of eCommerce.

eTailing, on the other hand, in India was at $6 billion in 2014, out of the  $16.4 billion of the  online business. This, with 16% of India’s population, largely under 35, online in 2013, according to Forrester Research, quoted By PWC.

Out of this same 16%, only 14% of it, or 28 million people, were online buyers - for books, accessories, electronics, apparel-constituting 80% of what they bought.

But now, apart from the holdall Amazons and Ali Babas joining the desi Flipcarts and Snapdeals,  there are property portals like Magicbricks, and multiplying online shops and showrooms for almost everything.

So what is the size and shape of India’s digital future including the much vaunted smart cities? The kitty was projected to grow to $22 billion by 2015, and five to seven-fold in number of online buyers by 2020. This means at least 200 million online consumers by then.  

If revenue grows at present rates where CAGRs’ are sometimes in the 30% plus area, the monetary value could become $105 billion, or much more by 2020.

If 200 million people were to become online purchasers, perhaps 500 million, rural and urban, would be just browsing online.

Significantly, our online buying penetration is already, in absolute terms, bigger than most countries, barring China, where 50% of its much bigger population, is buying online, if not exclusively, today.

The question is why? It is just faster and more cost-effective, even if it hasn’t realised its full potential yet.

The tentacular Indian post offices are going to join in too, as the COD last mile, and as payment banks.

But can the online model, pimped out and pumped up on outrageous valuations, VC funds, and cash-losing discount-selling, survive; let alone grow, manifold, in just four years?

Yes, because the delivery is potentially fantastic, and just about everything is clambering aboard!

The American Mall, the quintessential late 20^th century place to ‘hang-out’, is dying.  The same thing has been happening in metro India, though people in smaller towns, coming to the experience later, still like the razzle dazzle, the bright lights, the airconditioned swank.

But tier two and three towns are also huge internet users, for hooking up, as much as for selling, or buying.

Premium stand-alone markets in all our metro cities, with the steep rents, are morphing into upmarket restaurant-land. The retail footfalls however, are falling.

The office space market too is becoming a special interest zone- IT, banking/insurance back offices, larger brokerages, consumer sales/ marketing for white goods, vehicles, servicing establishments -need them.

Other high tech 24x 7 establishments, straddling time zones, use them for the concentrated infrastructure.

But many other small businesses no longer do, pointing to their cars, smart phones, laptops, memory sticks, and homes, instead.

Manufacturing, except for yesterday’s labour intensive variety, is also tending towards using fewer people, more machines/robots. Though robotics is a revolution yet to happen substantially in India, the objective of greater manufacturing employment may well mean more skilling and high-tech robotic factories in future, rather than early industrial revolution manual assembly lines.

Institutions - hospitals, schools, museums, universities, government offices, still need large places to congregate. But even here, a lot of what was physical has now gone virtual/digital.

This is inevitable progress, and therefore, a wave to ride, because there is no ducking it. And watch out, this brave new world ups the ante every quarter.

For: Nationalist Online

(1,016 words)

September 11^th, 2016

Gautam Mukherjee

Railway Surge Pricing For The Classes But None For The Masses

Railway Surge-Pricing For High-Standards, Speed, Safety, Cleanliness, Catering

The usual suspects are raising a predictable hue and cry against the Indian Railways surge pricing formula. Restricted, for now, only to its premium fast trains like the Duronto, Rajdhani and Shatabdi, used by the burgeoning middle class.

The idea is the common man, the masses, the very poor, can continue to use the hundreds of slower trains at no extra charge. That the clamour should fly in the face of a basic Marxist tenet, that the rich should be soaked for the benefit of the poor, is doubly inexplicable.

Besides, the Railway Ministry, farmed out to important coalition allies by the UPA, has been  criminally neglected in every way imaginable. This, starting with policy paralysis and rampant populism at the expense of deficits to the balance sheet, and ultimately the tax payer.

But the cavalier attitude also extended to dilapidated track and signalling equipment, ancient rolling-stock, degradation of all facilities, no growth, neglect of safety, illustrated by frequent accidents and loss of life, no innovation. The Indian Railways was on the absolute brink of collapse, when NDA II took over.

Happily, it is at last getting the priority and management it deserves, to restore the 4^th largest railway network in the world, back to health.

Under the latest dynamic formula, the better-off can either book well in advance to be amongst the first 10%, or pay more for the privilege, on a rising scale that goes up to 50% ,as the train fills up, closer to the day. This is exactly like budget-airline pricing, and in keeping with other railway systems elsewhere.

Earlier, urgent across-the-board hikes in passenger fares, freight-rates and tatkal/cancellation rates, after long years of  rate freeze, and blatant disregard of direct costs incurred and indirectly, a huge employee profile, did some good. But it was far from enough.

All these band-aid hikes, and other investments on new track, connectivity and so on, were contemplated by the UPA, but it just didn’t have the determination to implement any of it. But it doesn’t stop it and others who want a free lunch forever, from criticising the moves now.

 The new process kicks in, ‘on an experimental basis, for three months,’ from the 9^th of September 2016, probably to service the ‘festive season’ rush.  

Indian Railway officials are confident it will work through the year, because the premium ‘fast’ trains, still very few in number, are most often overbooked, and never dip below the 90% capacity mark.

The protest against the move comes from socialist intelligentsia blindly subverting its own logic, instantly spawned ‘railway activists’, the politically dwindled but vociferous Left, and some ubiquitous left leaning politicos.  

They accuse the Indian Railways of trying to make up their losses (Rs. 34,000 crores in the passenger segment alone), by taxing premium passengers with high ticket prices. Isn’t that what a good Marxist would do?

Some sputtering middle class objectors, long used to tax payer subsidised fares, claim that they would rather fly on a budget airline for two hours, than pay the Indian Railways up to 50% more for ‘a 16 hour journey’.

But there too, they might have to think again. If they want a cheap seat on a 200 or so seater budget airline aeroplane, they had better book way in advance! So those who expect a general exodus to air travel may well be confronted with rising prices and inadequate space there.

Union Railway Minister Suresh Prabhu has been making strenuous efforts to improve the product. There are new and better designed/appointed coaches, swifter travel times, using new state-of-the-art engines, better passenger safety/security, on board, and on the track. 

There are bio-toilets, quality linen, superior catering, wi-fi. Some 400 stations are being radically upgraded to modern airport standards.  There is on-board ticketing if necessary, streamlined administration, and a personal responsiveness to tweets sent direct to the minister.  

Brand new offerings such as Bullet and Maglev trains are on the way, no doubt at different price points. Taken together, the attempt is to offer a 21^st century array of product to Indian consumers for the first time.

On the freight side too, declining revenues will be corrected once efficient, fast, commodious and most importantly, dedicated freight corridors are operationalised.

 Care is being taken by the Modi government to protect the pockets of those who cannot afford higher prices. Even as it is catering to a very specific and insistent demand for a superior train travelling experience from the burgeoning middle classes.

For: ABP Live

(744 words)

September 9^th,   2016

Gautam Mukherjee

The Multi-Billion Dollar Shape & Size Of Out Digital Tomorrows

The Multi-Billion Dollar Shape & Size Of Our Digital Tomorrows

It’s not just because Reliance Jio, just launched, has made an aggressive pitch towards instant market leadership. It’s offering free ‘voice’, while charging for data usage, the real revenue McCoy, but in small chunks, for little money.

In the end, Jio won’t take in less in aggregate, but will do so with better lures. 

Will it appropriate Modi’s  Digital India vision? Well, the backbone of it, could well be the smartphone.

It’s clever stuff, this battle for the concept definition itself, but is cellular telecom all there is to it?

The notion is fuelled and reinforced by the Mobile App, the medium through which a lot of digital traffic/eCommerce is growing, rather than via the laptop/tablet.

Even if mobile telecom isn’t synonymous with Digital India, the internet certainly is; and 3 G, 4G and 5G speeds, will continue to batter down the dimensions of both time and distance.

Money, they say, never sleeps, but neither does the eCommercial marketplace. It is awake for the insomniac, and never takes a day off.

Jio could well be the blockbuster, given the potential of the Indian telecommunications market. It already boasts over a billion cellphones in use, many of which are voice only. Older people tend to be technology averse.

But other gadgets are inexpensive, and not so cheap, smart phones - consuming entertainment, data, advertising, media, music, photos, videos - receiving tax returns, banking, governance, subsidies, payments, surveillance.

And people are forever upgrading to more, for less, and even the defence of the realm depends on it.

eCommerce already dominates the travel business, morphed into eTravel, and this accounts for 70% of the entire caboodle.

eTailing, on the other hand, in India was at $6 billion, out of the  $16.4 billion of the  online business in 2014.

This, with 16% of India’s population, largely under 35, online in 2013, according to Forrester Research, quoted By PWC.

Out of this, only 14%, or 28 million people, were online buyers - for books, accessories, electronics, apparel-constituting 80% of what they bought.

But now that the Amazons and Ali Babas are joining in, along with the Magicbricks. So what is the size and shape of our digital future?

The kitty was projected to grow to $22 billion by 2015, and five to seven-fold in number of online buyers by 2020. This means 200 million consumers.  

And would the monetary pile be $105 billion, or more? And how many  more people just browsing online- 500 million maybe?

Significantly, our online buying penetration is already, in absolute terms, bigger than most countries, barring China, where 50% of its much bigger population, is buying online, if not exclusively, today.

The question is why? It is just faster and more cost effective, even if it hasn’t realised its full potential yet.

The tentacular Indian post offices are going to join in too, as the COD last mile, and as payment banks.

But can the online model, pimped out and pumped up on outrageous valuations, VC funds, and cash-losing discount-selling, survive, let alone grow, manifold, in just four years? Yes, because the delivery is potentially fantastic, and just about everything else, is clambering aboard!

The American Mall, the quintessential late 20^th century place to ‘hang-out’, is dying.  The same thing has been happening in metro India, though people in smaller towns, coming to the experience later, still like the razzle dazzle, the bright lights, the airconditioned swank.

But tier two and three towns are also huge internet users, for hooking up, as much as for selling, or buying.

Premium stand-alone markets in all our metro cities, with the steep rents, are morphing into upmarket restaurant-land. The retail footfalls however, are falling.

The office space market too is becoming a special interest zone- IT, banking/insurance back offices, larger brokerages, consumer sales/ marketing for white goods, vehicles, servicing establishments -need them.

Other high tech 24x 7 establishments, straddling time zones, use them for the concentrated infrastructure.

But many other small businesses no longer do, pointing to their cars, smart phones, laptops, and homes, instead.

Manufacturing, except for yesterday’s labour intensive variety, is also tending towards using fewer people, more machines/robots. Though robotics is a revolution yet to happen substantially in India.

Institutions - hospitals, schools, museums, universities, government offices, still need large places to congregate. But even here, a lot of what was physical has now gone virtual/digital.

This is, therefore, a wave to ride, because there is no ducking it, and watch out, it ups the ante every quarter.

For: ABP Live

(748 words)

September 7^th, 2016

Gautam Mukherjee

Take-Aways For India From The G20 Summit At Huangzhou

Take-Aways For India From the G 20 Summit At Hangzhou

America may have a better perspective on China than China itself. President Obama called it a ‘middle-income economy,’ with ‘mercantilist’, self-advantaging ideas, that need changing.

This, in an interview with Indo-American journalist Farid Zakaria, on the eve of the G20 summit at Hangzhou. And prior to the next pyramiding at Laos coming up.

This was President Obama’s last scheduled official visit to Asia before the end of his presidency.

Making his words count, Obama intoned his oft repeated mantra, that with increasing power, comes increasing responsibility, and that it was incumbent on a responsible country to respect the rule of international law. It was also necessary for durable international trade, for both sides to gain, and be able to see their relative advantages.

He pointed out that America, (as the paramount military power), did not have to uphold international law, but does so, to keep the world in order and harmony.

This notwithstanding its historical tendency to pre-empt and meddle wherever it sees fit, its dodgy record with ISIS, and indeed the cosiness of the G2 with China at the beginning of the Obama presidency!

In the specific context of the South China Sea, Obama suggested that China cannot flout the decision of the International Court of Justice at the Hague, just because it had found in favour of the much smaller and militarily weaker Philippines.

Obama may well have articulated what is on the mind of other countries in the littoral such as Vietnam, Japan, Taiwan, and India, for that matter. After all, what the US can get away with, is not what China can.

That Modi visited Vietnam to sign a slew of defence, oil, and other pacts just before going to Hangzhou, a visit by an Indian prime minister after 15 years, underlines the shifting emphases.

India has also been increasing its military support of Afghanistan, with tacit US approval, growing into its broader responsibilities, as a counter-weight, that will, more cogently, include the Indian Ocean going forward.

India, in a 35 minute meeting between Prime Minister Modi and President Xi Jinping, reiterated its concerns, now backed by America.

These include the CPEC going through PoK/Gilgit-Baltistan, and Balochistan; India’s NSG bid blocked at Seoul, chronic cross-border terrorism from China’s all-weather friend, the stymied UN declaration  of the JeM chief Masood Azhar as a  wanted terrorist, and China’s own frequent transgressions on the LAC.

Modi blandly said it was important to be sensitive to each-other’s aspirations.

China, on its part, asserted that ‘hard won’ understandings with India needed to be taken forward.

But all this, of course, is standard diplomatese. What is different in the Hangzhou exchange however, is India’s firm stance, its push-back, that has challenged the constant China/Pakistan narrative.

India recently beefed up its security at Ladakh, with over 100 tanks, overruling China’s malafide objections; and likewise in the North East, with airports, road, and rail being made made functional, and Brahmos missiles stationed already.

It has also obliquely put Pakistan/China on notice, both in PoK/Gilgit-Baltistan, asserting it plainly to be Indian territory. And in Balochistan;  openly backing the Balochi bid for independence from Pakistan.  

Both of these  policy initiatives have received enthusiastic responses from the people of the respective regions, and their diaspora abroad. India has also restarted its Balochi service on AIR.  

This meeting has come just after the signing of LEMOA with the US, as part of a burgeoning defence partnership.

The support of the others in the UNSC, including old friend Russia, not only to India’s own UNSC bid, also implies further military support from NATO/ANZACS.

America/Japan renewed their assertion that India is a force for non-proliferation, and needs to be included in the NSG and before the end of the year. China now admits to being ‘cornered’ on this, but it remains to be seen how it plays out.

It has, for example, deployed its stealth bombers in the Tibet theatre, after warning India, prior to the Hangzhou Summit. It has also quickly announced a defence pact of its own with Pakistan, after India’s LEMOA signing.

 In the broader G20, India has raised the issue of international terrorism strongly. It tends to do so at almost every forum it attends now, and a consensus is definitely building towards combating the menace multilaterally.

Similarly, another bugle call that is increasingly resonating everywhere, is on the matter of illicit funds - from corruption, drugs, gun-running, smuggling, extortion, etc. moving around/hiding in tax havens, morphing across international financial systems.

Apart from this money’s unsavoury origins, its mostly tax-evaded configuration, it sometimes is yet another vital adjunct to the bloody business of international terror – its financial lifeline.

And, in the midst of all this and other weighty talk on the global economy, there was no mention of the unrest in the Kashmir Valley at all.

For: Nationalist Online

(800 words)

September 5^th, 2016

Gautam Mukherjee

Defence Partner & LEMOA: The Road To The Great Equalizer

Defence Partner & LEMOA: The Road To The Great Equalizer

The Chinese thought India’s signing of the LEMOA (Logistics Exchange Memorandum of Agreement), with the US was ‘troubles’. For whom, they did not say, but it is unlikely they meant themselves.

This agreement allows mutual access to military facilities for refuelling. LEMOA also allows for provisioning and replenishment of supplies, all on a reimbursable basis.

LEMOA does not automatically allow for military bases to be set up, and/or the stationing of troops, but these too can be authorised on a case-to-case basis.  

It is the second agreement, out of four, for America’s defence partners. Two more are now under discussion. They are the CISMOA (Communications Interoperability & Security Memorandum of Agreement), and the BECA (Basic Exchange & Cooperation Agreement for Geo-Spatial Cooperation).  

LEMOA comes after India was designated as a ‘Major Defence Partner’ during Prime Minister Narendra Modi’s state visit to the US in June 2016.

 The first in the series, the GSOMIA (General Security of Military Information Agreement), was signed by the Vajpayee/Dubya Bush governments, way back in 2002.The UPA, significantly, did not move forward at all on this strategic embrace during its decade in power.

For, India, LEMOA, its own $150 billion defence shopping list over the next 10 years, inclusive of Make in India, and its Modi Doctrine of ‘enlightened self-interest’, puts it in a unique position.

As for India’s tried and tested ties with Russia, there will be no downgrading it, and many military initiatives, in parallel, including some involving very high technology platforms, are on the anvil. But yes, an edge of competition has entered the equation, and should work very well in India’s favour.

We will, in addition, cooperate with other military manufacturing powers such as Britain, France, Israel, Sweden, Italy. We will also expand economic cooperation with many in the G-20, BRICS, other formations like ASEAN/APEC - including China.

This latest ‘troubles’ remark came, after the Chinese blocked our NSG bid. Other Chinese commentators from a security establishment think-tank growled, when India positioned its supersonic Brahmos missiles, on its North Eastern border areas. Some also grumbled when India positioned over 100 tanks in Ladakh. And again, when India raised the occupation/genocide/oppression, by the Pakistani state in POK/Gilgit-Baltistan and Balochistan.  

With India being a nuclear weapons state, the threat, if it comes to it, is of a multi-front conventional war, with Pakistan and China attacking in tandem.

At this juncture of geo-political imperatives, a military alliance with America therefore acts as a great equaliser vis-a-vis China, and gives India time to build up its independent military capabilities.

Besides, America is not willing, to give China a free passage to regional domination. This, any more than its NATO or ANZAC allies, or various other countries in South/South –South East Asia, including Japan, who are feeling the Chinese/North Korean overbite.

China will have to realise that it is deeply isolated, with only a couple of unstable rogue states in the form of Pakistan and North Korea for company.

China’s old ‘string of pearls’ strategy of encirclement of India via economic and infrastructural participation in Myanmar, Bangladesh, Sri Lanka, Afghanistan, Nepal, the Maldives, Bhutan etc. now lies in ruins.

 Xi Jinping’s Albert Speerish ‘belt and road’ initiative, figuratively girding the world as a  super Silk Route, also makes everyone approached uncomfortable, including communities of people in Gilgit-Baltistan and Balochistan, where the proposed CPEC is part of it.

But apart from the hawkish posturing, China too is keen to advance economic cooperation with India, in manufacturing, infrastructure-particularly in the Indian Railways, and trade. It is necessary for China to resolve its aggressive tendencies though, because India is no longer willing to be intimidated, and has a number of other options.

China however is most impressed with its own sizeable military. It wants the world to fear its conventional and nuclear might.

It wants to dominate its half the world, ignoring the wishes of others in its littoral. It does not accept the International Court of Justice at the Hague’s verdict on the South China Sea, and still wants it exclusively for itself - ignoring Vietnam and the Philippines in the process.

It wants to dominate the Indian Ocean too, and has been patrolling it vigorously in recent years.

China’s notions on diplomacy also emboldens it to ignore the wishes of  the other members of the UNSC, thinking being factory to 40% of the world’s manufactured goods is enough leverage.

That the ancient, but newly prosperous Chinese, do not understand the implications of trying to game the much more powerful America, seems amply clear.

America has a military 17 times bigger than the next power, and China is not it! So, for India, a defence pact with America at this juncture is most comforting, enabling it to deal fairly with the rest of the world without security worries.

For: Nationalist Online

(798 words)

August 30^th, 2016

Gautam Mukherjee

LEMOA And Beyond:: Slowly-Slowly-Catchee-Monkey

LEMOA And Beyond: Slowly-Slowly-Catchee-Monkey…

Chinese commentators, punch drunk on being the world’s second largest economy, promptly reacted negatively to India’s signing of the LEMOA (Logistics Exchange Memorandum of Agreement), with the US.

This agreement allows mutual access to  military facilities for refuelling - flashback: remember Prime Minister Chandra Shekhar’s secretive one-off okay to  refuelling US planes, during the first Gulf War against Saddam Hussein’s Iraq?

LEMOA also allows for provisioning and replenishment of supplies, a kind of stevedoring exercise, all on a reimbursable basis.

LEMOA does not automatically allow for military bases to be set up, and/or the stationing of troops, but these too can be authorised on a case-to-case basis within the framework of this momentous agreement. So, it looks innocuous, but is not. China is right on its significance.

The other two ‘foundational’ agreements, out of four, typically signed between America and its defence partners, are now under discussion. They are the CISMOA (Communications Interoperability & Security Memorandum of Agreement), and the BECA (Basic Exchange & Cooperation Agreement for Geo-Spatial Cooperation). No time lines for their signing however have been posted as yet.

However, not only did the Pentagon reiterate its support for India’s entry into the NSG ( Nuclear Suppliers Group), after the recent Chinese block, it mentioned India’s recent inclusion in the MTCR( Missile Technology Control Regime), which does not count China as a member  so far, as well.

That LEMOA coincided with the visit of US Secretary of State Kerry to New Delhi, even as  Indian Defence Minister Manohar Parrikar is in Washington interacting with US Secretary of Defence Ashton Carter.

It comes after India was designated as a ‘Major Defence Partner’ during Prime Minister Narendra Modi’s state visit to the US in June 2016.

 And all of 12 years after the first in the series of four enabling agreements, the GSOMIA (General Security of Military Information Agreement), was signed by the Vajpayee/Dubya Bush governments, in 2002.

 The UPA did not move forward at all on this strategic embrace during its decade in power. This probably because it was caught up in the web of its own policy history on Nehruvian non-alignment, Indira Gandhi’s time as a satellite of the USSR, and pathological fear of Chinese umbrage, carried over into the Manmohan Singh regime.

For, India, LEMOA, its own $150 billion defence shopping list, inclusive of Make in India, over the next decade, and its Modi Doctrine of ‘enlightened self-interest’, puts it in a unique position. It’s the biggest defence purchase wish-list in the world.

Meanwhile, at this juncture of geo-political imperatives, a military alliance with America acts as a great equaliser vis-a-vis China, and gives India time to build up its independent military readiness.

Besides, America is not willing, any more than its NATO or ANZAC allies, plus the emerging realignments in South/South –South East Asia, to give China any kind of walkover in the world dominance stakes.

Instead China will have to eat a little crow, and re-evaluate its own options. It must realise that it is deeply isolated, with only a couple of unstable rogue states in the form of Pakistan and North Korea for company.

China’s old ‘string of pearls’ strategy of encirclement of India via inducements to Myanmar, Bangladesh, Sri Lanka, Afghanistan, Nepal, the Maldives, Bhutan etc. now lies in tatters. And Xi Jinping’s grandoise ‘belt and road’ initiative, figuratively taking off from the Old Silk Route, is viewed with suspicion in every part of its immediate neighbourhood.

As for India’s tried and tested ties with Russia, there will be no let up and many military initiatives, in parallel, are indeed, on the anvil. But yes, an edge of competition has  already crept in, and should work altogether in India’s favour.

This has already been borne out in the nuclear power context, not only with Russia, but also with France and the US all supplying reactors and know-how.

We will, it is clear, cooperate with every other major military power such as Britain and France on a bilateral basis, too; and this includes Israel, Sweden, Italy; and press on with economic cooperation with many in the G-20 and BRICS and other formations like ASEAN/APEC, including China.

China too is keen to advance economic cooperation with India, in manufacturing, infrastructure-particularly in the Indian Railways, and trade. It is for it to resolve its aggressive tendencies however, because India is no longer willing to be intimidated, and has a number of other options.

For the moment, in keeping with its customary hubris, China said the signing of LEMOA meant ‘troubles’. This implies, despite the enigmatic-speak, not so much grief for itself, because it is loathe to admit that its posturing has been challenged.

No, it is troubles for India that is being threatened. India is militarily ill-equipped and much poorer, it is true. But, unlike 1962, it is inconveniently nuclear weaponised.

The threat of late therefore, is of a multi-front conventional war, with Pakistan and China attacking in tandem. India does not have the wherewithal to fight this to win on its own currently, but with a little help from America, it can, and will.

Besides, this ‘troubles’ remark came, after the Chinese smirk on blocking our NSG bid. Just as other Chinese commentators in a security establishment think-tank growled, when India positioned its supersonic Brahmos missiles, on its North Eastern border areas.

Some also grumbled when India positioned over 100 tanks in Ladakh, not so long ago.

And again, when India raised the occupation/genocide/oppression, by the Pakistani state in POK/Gilgit-Baltistan and Balochistan.

There goes the CPEC, Beijing must be thinking, already being criticised by the jailed Baba Jan’s followers in Gilgit-Baltistan and PoK; and all those tonnes of precious minerals. And so, China allowed that it might ‘intervene’ in Balochistan too.

China is most impressed with its own sizeable, largely copied from old US stock, military. It wants the world to fear its conventional and nuclear might.

But then, China makes no secret of wanting to control half the world. Never mind what Taiwan, Japan, Vietnam, the Philippines, even Hong Kong and Tibet, others, in  South /South-East Asia, and the Asia-Pacific, think.

And never mind what the International Court of Justice at the Hague has to say too. China wants the South China Sea for itself, and does not recognise the Hague ruling against it. It has been bumptiously issuing warnings to all and sundry within and without its range.

It wants to dominate the Indian Ocean too, and has been patrolling it mightily in recent years.

China’s mandarin notions on diplomacy also emboldens it to ignore the wishes of other members of the UNSC, such as Russia, Britain, and France, thinking being factory to 40% of the world’s manufactured goods is enough leverage.

It has been trying, preposterously, from before President Xi Jinping’s time, to buy-off America, purchasing its treasury bonds in trillions, while, sotto voce, threatening monetary destabilisation!

It particularly wanted to take advantage of America’s economic troubles post 2008, by upgrading its claims, if not the balance of payments, while attempting to cede a sphere of influence to it. Take the other half of the world, China seemed to say: meaning the Atlantic, the Mediterranean, the North Sea etc..

That the ancient, but newly prosperous Chinese, do not understand the implications of trying to parley, on the basis of riches acquired thanks to the Nixon-Kissinger tilt against the USSR, with the world’s most technologically advanced military power; seems amply clear.

America, the fact the Chinese try to ignore, is sized at 17 times greater than the next military establishment in line! So, for India, it’s a good eiderdown to get under, while continuing to deal fairly with the rest of the world.

For: The Sunday Guardian

(1,277 words)

August 30^th, 2016

Gautam Mukherjee

Time To Expel Socialism From Electricity Economics?

Time To Expel Socialism From Electricity Economics?

The selling price of solar electricity in the US is 3 cents/Kwh in 2016. Solar electricity pricing, it is clear, will dominate, like OPEC once did, going forward.

This is far cheaper than Indian coal-based power generation. Thermal generation accounts for 54.5% of the total (2013). Installed capacity is 267, 637 MW, generating 1106 billion Kwh.

Additionally, there are captive power stations, 47,082 MW worth, generating 166,426 Kwh (2014-15) and 75,000 MW of diesel generating sets.

Fortunately, India under Modi has understood where the world is headed, and is adding solar capacity furiously- hopefully, 100,000 MW by 2020.

Similarly, hydro, accounting for just 5% generation in 2013, is due to be boosted considerably, as is wind energy, contributing 8.5% already.

So, in the medium term, along with nuclear energy, 5 reactors under construction, another 18  targeted for 2025, electricity will be plentiful, greener, and much cheaper.

India now has an Electricity Act 2003, and a National Electricity Policy 2005, both of which piously seek to emphasise rural electrification, particularly of poor Dalit households.

However, even at present levels of generation, there is, ironically, a complaint of inadequate demand, mainly because the backbone doesn’t reach everywhere necessary - and because electricity is a perishable commodity that can’t be stored!

We currently buy in Bhutan’s surplus electricity, probably as a balance of payments mechanism, and sell our surplus to Bangladesh and Myanmar, in return for their natural gas, for which a new pipeline and road/rail links are in the works.

This, even as we seek to grow and modernise our generation, transmission grids, our distribution - to cater to present/future demand and connectivity.

But, like everything else, when it comes to consumption, it is the upper end of the pyramid that tends to do most of it. The problem is, we have not taken a benign policy stance to this favourable reality.

Better off people, including productive business  and industry, can afford to consume more of everything, electricity included, and should be rewarded for it. And yet, even though this is what makes all enterprise both viable and profitable, there is little or no policy acknowledgement as yet.

In America, where lavish amounts of domestic electricity for heating/airconditioning, myriad appliances/gadgets, is largely provided by neighbouring private utility companies; large consumers are rewarded with discounted tariffs. Here, in India, they are penalised, with rapacious rates, and lectured on conservation.

The government policy makers still persist on aiming electricity at the one third that is poverty stricken. But, laudable as this is, it is financially unworkable, if the big consumers are not encouraged to consume even more to compensate.

Very poor people cannot buy much electricity, even at rock-bottom tariffs, calculated presently on fossil-fuel generated electricity.  

Nevertheless, additional domestic rates are being proposed now, higher than even the preposterous Rs. 8 per Kwh for the big users.

For running two or more airconditioners, the Delhi public is being told to expect another Rs. 10,000/- or more, to their monthly electricity bill. Other states too, follow similar policies. Commercial/industrial rates, are anyway, even higher!

That this is a clear invitation to meter-fiddling corruption, rampant already, is another, if related, matter.   

India is third in energy consumption today, after China and the US, but it still accounts for just 5.3% of the global share (2015).

And this, on poor per capita consumption of just 1,010 Kwh, which means the poor don’t even consume this meagre amount, but are counted in the averaging for merely being numerous.  

We are expected to become the second largest by 2035, accounting for 18% of world electricity consumption. But what use is this, if it is just a sum based on even more people?

Albeit our askew dependence on fossil fuel to generate electricity- 29.45% from crude oil, 7.7% from natural gas, and 54.5% from coal, (we have the world’s 4^th largest deposits of coal) is a big part of the problem today.

The Modi government expects to have universal electricity connectivity within its current term of office; 2018 is often mentioned. 

The Government of India also expects to be electricity surplus by 2017!  

What joy then if graded electricity tariffs start at a meagre 200 units a month, barely enough to run a couple of LED bulbs?

If a consumer uses more than 200 units, the tariff is stepped up, and at  a couple of thousand units a month, running airconditioners, microwaves, heaters, and the like, tariffs are whizzing the meter, at multiples of the base rate!

For: ABP Live

(747 words)

August 26^th, 2016

Gautam Mukherjee