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PL480 TO NFSA 2013

Many of us would not be even aware that in the 1960s India was forced to import wheat fromthe US under the PL 480 scheme as it suffered from a severe short age of food grain. The storiesof humil iation and pressure to compromise on Indias foreign policy to avail of t his facili ty arenow things of the past. The country has moved ahead from the PL 480 phase to a new era ofeconomic reali ty where it has enacted the National Food Securit y Act (NFSA)- 2013 whichassures food to 67 percent of people in the country who are likely to suffer food deprivation.This indeed marks a giant leap whose impact is going to be mult i-dimensional and mult i-layered.The guaranteed availabil it y of food to the people, especially those in t he below poverty li nebracket and belonging to vulnerable section of society will have a significant income effecttranslating into higher nutr it ional intake and therefore improved healt h status.India has a long established Public Distribution System (PDS) which has played a significant rolein keeping the chronic hunger at bay and has a strong impact on the reduction of poverty. Therehas been a signif icant shif t in the policy perspective from PDS to Targeted PDS (TPDS) since1997 that replaced the universal access with focus on the families below poverty line by givingthem a higher level of food subsidy.It has been estimated that close to 30 percent of t he povert y reduction witnessed during the

period 2004-05 to 2009-10 is att ributable to PDS. This figure does not include around 17mil lion people being lif ted out of poverty in 2009-10 support ed by the mid-day meal scheme.The Food-security legislat ion has been crit icised for increasing the subsidy out f low of t hegovernment to unsustainable levels. The estimated annual expenditure to meet the provisionsof the NFSA2013 is approximately 1,25,000 crore. Though, there have been many estimatesgoing upto 3,00,000 crores, there does not seem to be any dramatic and unsustainable increasein the allocation already being made for this component under the TPDS.The enactment of the NFSA 2013 is probably t he beginning of a long process that would requirethe policy makers to look at the mult i-dimensional factors affecting food-securit y, entit lementand access to it . India has become the first nation in t he world to give it s people right t o food.The light of Asia, sure, has the capacity to show the path of future to the world.

Gis t o f

YOJANA

NATIONAL FOOD SECURITY ACT:

WORK IN PROGRESS

Far the scept ics, much of the debate thatpreceded the enactment of the NFSA revolvedaround the issue of cost of the NFSA and its impact

on the economy. These ranged from a conservativeestimate of Rs 1 Lakh crore to as high as Rs 3 lakhcrore per year. However, most of these estimates areeither exaggerated and include many other costs notrelated to t he NFSA or are pure and simple fictitious
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numbers. The actual cost of the NFSA is expected toremain within the proposed limit of Rs 125000crores as given in the financial memorandum of thebill.

However, even for the activists and- the civi lsociety, the National Food Security Act 2013 falls farshort of a comprehensive legislation on food security.While the legal commitment of t he NFSA is limitedalmost ent ir ely to access, on avail abil it y andabsorpt ion it only promises goals for progressiverealisat ion. But even on access, government isallowed to get away with cash payments if it fails toensure supply.

Since the NFSA relies primarily on the existingPublic Distribution System (PDS) as the primary axis

for ensuring food securit y, concerns related to theeff iciency of the PDS remain valid. Such concerns onthe efficiency of the PDS primarily emanate fromthe previous experience of the PDS which is seen asa leaky system wit h more than 50 percent of t hegrain leaking in 2004-05.

The shift to Targeted PDS in 1997, whichdismantled the earlier universal access at relativelylow unit subsidies, replacing it with much higher unitsubsidies targeted towards the poor, led to increasein leakages between 1993-94 and 2004-05, alongwith decline in percentage of households whoactually accessed PDS cereals.

More importantly, there was considerableimpr ovement af ter 2004 in PDS access of t herelatively poor in almost all states. By 2009-10, over90 percent of rural poor got some food transfer in12 (and over 75 percent in 18) of the 30 states. Inparticular, Chhattisgarh and Odisha joined SouthernStates to extend near universal coverage whi lereducing leakage. The most notable such case isBihar, so far considered worst on PDS performance.But NSS 68thround reports that 43 percent of Biharhouseholds accessed PDS cereals in 2011-12, up fromonly 14 percent in 2009-10 and less than 2 percentin 2004-05. This expansion, unnoticed so far, is

remarkable because it went hand-in hand with twoother features: Bihar climbed to top of the povertyreduction league in 2011-12 from being a laggard sofar; and, much more signif icantly, Bihars PDS grainleakages reduced t o about 20 percent in 2011-12

from 65 percent in 2009-10 and 97 percent in 2004-05. These three states, which also happen to bestates with highest percentage of poor , havemanaged to do so, by expanding coverage alongwith administrative reforms such as de-privatisationof fair price shops and so on. These states have alsoused available technology such as GPS and mobilebased t racking system to reduce leakages. Otherstates with similar but less spectacular reboundinclude Assam and West Bengal.

While it did increase coverage to 67 percent ofthe households nationally (75 percent in rural and 50percent in urban), the NFSA is sil ent on how thebeneficiaries will be selected.

Fortunately, an alternative in the form of

Socio Economic and Caste Census (SECC 2011) wasavailable and could have been used not only tospecify the exact criteria for identification ofbeneficiaries but also to arr ive at a suitable estimateof number of households eligible for the benefit ineach state.

Unlike the BPL Census 2002, the SECC wasdesigned after prolonged consultations with variousstake holders including state governments, in termsof design and methodology of identif ication.

But even these, if implemented properly, areonly a smal l part of t he larger bat t le againstmalnutri tion. Other provisions of the NFSA such as

those related to chil dren and pregnant women,alt hough less talked about, are equally important.The challenges on these front are equally dauntingwit h very few success stories to emulate.

It is obvious that an ambit ious legislation suchas the NFSA will have to face the challenges ofimplementation on the ground.

THE FOOD SECURITY ACT (FSA) FISCAL

IMPLICATIONS: 2013-14 TO 2015-16

The National Food Securit y Bill (NFSB) waspassed by both houses of Parliament , and was givena nod by the President on September 12, 2013, andhas now become an Act. The legislation is alandmark, and perhaps the largest food securityprogram in the world.

The Act is indeed an import ant eff ort toensure that the majority of population in India has


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access to adequate quantity of food at affordableprices. It proposes to cover 75 percent of t he ruralpopulation, and 50 percent of the urban populationwith an entit lement of 5 kg per person per month offood grains at issue pri ces of Rs. 2 and per kg forwheat and rice respective.

This article establishes that fiscal implicationsof t he Food Securi t y Act (FSA) are likely t o besignificant. The food subsidy cost of implementingthe FSA is estimated at Rs. 124,502 crores for thefiscal year 2013-14. The cost is estimated to increaseto Rs. 140,192 and Rs. 157,701 crores in 2014-15and 2015-16 respectively. The incremental foodsubsidy over and above the existing Targeted PublicDistribution System (TPDS), which is the addit ional

cost to the budget, is estimated at Rs. 23,951 crores.This is equivalent t o 0.2 percent of GDP.

There are three addit ional dimensions, whichcan potentially magnify the fiscal implications. First,if the implementation of the FSA includes grand-fathering of existi ng beneficiaries, since noteveryone will be better off in the new regime, theestimated fiscal cost could be higher. Second, ifimplementat ion of the act r equires merging thecurrent classif ication under the TPDS with new andmore careful identification schemes, weshould alsoconsider the consequences of misclassification.Carrying over the currently misclassif ied into the new

system may also entail additional f iscal implications.Third, the open-ended procurement policies of thegovernment (whereby the government commit s tobuying unlimited quantities of wheat and rice at aminimum support price (MSP) have implied thatprocurement has typically been much higher than therequired quantity of food grains. For example, onaverage over the last 10 years between 2002-03 and2011-12, procurement has, been 40 percent higherthan the off-take from the public distribution system.If we add these costs of addit ional procurement tothe incremental food grain requirement in the FSA,the estimated f iscal cost can increase substantially.

Subsidy Cost of FSAWe estimate the f iscal cost of t he current

version of the act, which proposes to cover 75percent of the rural population, and 50 percent ofthe urban population with an entitlement of 5 kg

per person per month of foodgrains at issue prices ofRs. 2 and 3 per kg for wheat and rice respectively.This proposal has only two categories: covered anduncovered, rather t han three (priori ty, general anduncovered) in the previous version of over and abovethe existing TPDS is t he bill . The AAY (AntyodayaAnna estimated at Rs. 23,951 crores. This is Yojana)households will receive an equivalent to 0.2 percentof GDP. The addit ional 10 kgs of food grains perincremental subsidy is the difference householdprotect t heir existing between the estimated cost ofthe allocations.

The food subsidy cost of implementing theFSA is estimated at Rs. 114,502 crores for 2013-14.The food subsidy is calculated as [economic cost-

issue price] food-grain requirement . The economiccost computed by the FCI included in addit ion t o theMSP, handling, storage and distribution costs. Thecalculation assumes a total coverage of 75 percent ofrural and 50 percent of t he urban population.

Other Financial Cost of FSA

A commonly ignored fact is that even aft erseveral amendments, the act entails signif icant newfinancial implications in addition to the food subsidy.This includes e.g. the setting up/running of State FoodCommissions and Dist rict Grievance RedressedOff icers (DGROs); expenditures on int ra-statetranspiration of food grains; and cash benefit s topregnant and lactating women. Most of theseexpenditures would be incremental and is estimatedwit h inputs fr om the MOF & PD at roughly Rs.20,760 crores annually. Rs. 8,760 crores would beincurred b the state, and the remaining cost wouldbe shared between the cent re and state (based on asharing arrangement t o be determined). A one-t imeassistance may also be provided by the centre to thestates to enable them to set up the State FoodCommissions and DGROs.

The sett ing up of national food commission isdone away with in the latest version of the act; andstates are allowed to rejig existing inf rastructure to

run state food commissions and DGROs but it isreasonable to assume that even i f states decide notto create new infrastructure, they would still needto incur additional expenditures to beef up theexisting facili t ies to implement t he FSA.


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The total i ncrement al f iscal cost ofimplementing the FSA over and above the existingTPDS (including the quantifiable expenditures inaddition to the food subsidy) is thus estimated for2013-14 at Rs. 44,711 crores. The estimated totalincremental f iscal cost for 2014-15 and 2015-16 areestimated at Rs. 47,392 and Rs. 50,591 crores

respectively.Distributional Implications of FSA

In addition to the aggregate fiscal costs ofimplementing the act, there will be distributionalimplications as well; where some individuals maygain, some may lose, and .others may have theirfood expendit ures unchanged.

All AAYs can be relabeled as covered. Theywill be as well off as under the current TPDS;

their entit lement wil l be unchanged at 7 kgper person per month, and they wil l pay thesame issue price: Rs. 2 and Rs. 3 per kg forwheat and rice respectively.

The remaining BPL individuals (62 percent)will obtain 5 kg of foodgrains at a lower issuepri ce than under the TPDS but t heir

entitlement will also reduce by 2 kg.Assuming current prices of wheat and rice(in the north zone at Rs. 19 and Rs. 27 perkg for wheat and rice respectively) andassuming they will demand at least as muchas under TPDS, they will be strictly worse off(the loss on the 2 kg entitlement willoutweigh the gain on the 5 kg).

Table 1: Additional Annual Expenditures under FSA (Rs. Crores)_

State Shared b/w centre and state TotalDistrict Grievance Redressal Off ice (DGRO) 320

State Food Commission 140

Expenditure on intra-state tr anspirati on and handling of foodgrains 8300

Maternity benefit 12000

Total 8760 12000 20760

Table 2: Distributional Implications: Current TPDS vs FSA

AAY Covered Difference in issue

price 137495

(TPDS-NFSB) rs./ton)_137495 Wheat Rice

Ot her BPL persons i n 000 Covered increased expendi ture Di ff erence in issue price (TPDS-NFSB) (rs./ton)

2,150 2,650

221,122 62%

APL persons 452,151 71% Covered increased expenditure 4,100 2,650

Remaining APL No coverage

181,312 29% Increased expenditure

Note:The estimates for TPDS are based on how it is current ly operated (1993/94 poverty ratio and2000 population) The on-AAY BPL persons who move to covered: they were getting 7 kgs before at a higherissue price; they get 5 kg now at the lower issue price, but the gain on 5 kg outweighs the loss of entitlementof 2 kg, which they have to acquire now at the market price, accounting for a potential increase in theexpenditures. APL persons moving out of coverage under NFSB have to obtain the grains through the market,and hence a potential increase in their expenditures.

71 percent of APLs will move into coveredcategory. They will obtain 2 kgs of addit ionalfood grains and a lower issue price relative

to TPDS; they will be strictly better of. Overall , out of the current population

covered under the existing TPDS, 46 percent


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will be strictly better off, 14 percent will beequally better off and 40 percent will bestrictly worse off

Issue about Misclassification in Current TPDS

Similarly, if implementation of FSA requiresmerging the current classif ication under the TPDSwith new and more careful identification schemes, weshould also consider the consequences of mis-classification.

Table 3: Cost of Grandfathering

Number of other BPLs moving into covered 221,122

Additional foodgrain per person (kg) 2

total foodgrain (mn ton) 5.31

Wheat 2.41

Rice 2.89Subsidy (Rs.ton)

Wheat 15952

Rice 20786

Total subsidy bill (Rs. Crores)

Wheat 3852

Rice 6012

Total 9864

Number of APLs moving out of coverage 181,312

Addit ional foodgrain per person (kg) 3

Total foodgrain (mn ton) 6.53

Wheat .97

Rice 3.56

Subsidy to be borne by govt . Rs. per t on

Wheat 14,002Rice 18,136

Total cost (Rs. Crores) 20,474

Incremental cost over TPDS (rs. Crores) 23,951

Total including grandfathering - Rs. Crores 44,425

Suppose everyone classif ied as BPL under thecurrent scheme is automaticall y given coveredstatus. However, everyone who currently holds aBPL card may not be truly poor.

Conclusion

To summarize, the total incremental costs ofimplementing the FSA over the above the TPDScould range from Rs. 44,711 to Rs. 76,486 crores in2013-14. The smaller estimate is the baselineincremental costs, while the large estimate includesthe costs of grand fathering the existing beneficiariesand subsidizing the BPLs who are currentlymisclassified.

DEMOCRACY AND SOCIAL

TRANSFORMATION:

INSIGHTS FROM AMBEDKAR

Ambedkars Views on Democracy

The conception of democracy right from itsorigin in antiquity to the modem t imes takes it asthe form of government as alluded to by Ambedkarin the above quotation, but he easily extends itbeyond the bounds of government when he says,Democracy is not merely a form of Government. Itis primarily a mode of associated living, of conjoint ,communicated experience. It is essentially anat t it ude of respect and reverence towardsfellowmen. He equates it to fr aternit y, saying

fraternity.. is only another name for democracy,and elsewhere to his favorite value triad, liberty,equali ty, f raternity

According to him, democracy presupposes ademocratic society:

The term social democracy generallysubsumed economic instit utions and reflected theFabian belief in gradual t ransformation of capitalismint o socialism. But in Ambedkars view, it meanssociety sans hierarchy, exclusion, and segregation. Itacutely refers to the Indian society and its castes.

Constitutional Vision

Constitution is a rule book for politicalgovernance in democracies. Though, the chairman ofthe draft ing commit tee, it should be noted that hisvision was entirely different from what theConstitution of India reflects. He was not satisfiedwit h mere polit ical democracy because he knew thatit would not be sustained without economicdemocracy.

He was very clear that the economy based onprivate enterprise violates the principle ofdemocracy. Private enterpri se essent ially entail sconcentration of wealt h and hence power in privateindividuals which necessari ly leads to undermininglights of people, who have to work for their survival.

Actually, he was verbalizing his scheme ofstate socialism, which he had just drawn up to besubmit ted to the Constit uent Assembly on behalf ofthe Scheduled Caste Federation. He elaborated thisscheme in hisStates and Minori t ies.Unfortunately, his


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ideas were not accept ed by t he Consti tuentAssembly and its truncated part s were shifted to theDirective Principles of the State Policy in Part IV ofthe Constit ution, left to the sweet will of the rulers.

Culmination into Buddhism

One of the most interesting features of Dr.Ambedkars philosophy is his stress on the ethicaldimension of democracy, or what he calledmorality. We aspect of this is importance ofconstitutional morality, which is, abiding by thespirit of the Constitution and not just its legalprovisions.

Indias Tryst with Democracy

India, despite such a doyen of democracy as

Ambedkar guiding its Constitution, has pursued thepath of capitalist development laid down by the bigbourgeoisie vide their Bombay Plan created inJanuary 1944 by vir tually adopt ing its 15 yearsinvestment plan for i ts first three five-year plans. Itsystematically transformed vast rural India into thegrazing grounds of capitalism by undertaking thecali brated land reforms and implement ing thecapitalist strategy of Green revolution.

According to the Global Hunger Index (GHI)of the International Food Policy Research Institute(IFPRI), India is 67th among the worst 80 countr iesin terms of malnourishment. India continues to be

home for maximum number of lepers in the world,maximum number of i ll it erate adults in the world,largest number of people (626 million) who lacksanit ation and who defecat e in open; largestpopulation that lacks access to drinking water, andmany such parameters.

Over t he last three decades the camouf lage ofsocialist rhetoric is torn to shreds by the socialDarwinist globalization, which is intrinsicallyantithetical to any concept of democracy. It hashelped India achieve economic growth beyond i tsdecades-long range-bound rate, which wasderogatori ly r eferr ed to as the Hindu r ate of

growth. It has surely transformed India beyondrecognit ion f or t he eli te and middle classes, andthereby emboldened them to discard their apologiaof decades and t ake pride in t heir customs andtradit ions, which have been detrimental to the lower

caste people. In t he result ant euphoria, they ignoredeven other parameters of economy required forsustaining the growth. Today, hollowness of i t hasbegun to surface. For instance, on the economicmisery index, as the sum of the unemployment rateand the inf lation rate, a measure of vulnerabilit y andcrisis of economy, India ranks dangerously behind itspeers in BRIC countries at 17.8 as against China at9.1.

FOOD SECURITY BILLWOULD IT WIPE

OUT HUNGER AND MALNUTRITION?

The persons covered may be as many as 75percent of rural and 50 percent of urban population.A number of question arise concerning

1. Need2. Coverage3. Beneficiaries4. Effectiveness, impact on5. Hunger6. Malnutrition7. Food grains production, cost and financial

implicationsAlso, one wonders if this is the best way to

reach the objectives.

What was the need for the Food Security

Bill (FSB)?

To sum up PDS has a large exclusion error and doesnt

reach most of the poor. It provides only a fraction of food grain

consumption of the poor households. The money value of income transfer through

PDS grains is also modest. The poor get a bit more than 10 per cent of

the total subsidy expense of thegovernment. More recent figures showsthat they receive 32 percent of the totalexpendit ure.

More than 40 percent of the PDS grains do

not reach the consumers.Since a large part of the poor are excluded, theFSB aims at effectively reaching all the poor.

Is the coverage right:One way to deal wit hthe exclusion error is to go for a universal right to


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food under which everyone is ent i t led to getsubsidized food grains from the PDS as proposed bythe National Advisory Commit tee. The food securi tybill aims to cover up to 75 percent of the ruralhouseholds and 50 percent of the urban ones are tobe covered. I f you want to ensure that no poorperson is excluded though many non-poor may beincluded, this is perhaps the right level of coverage.

Would it affect food grains production?

If, and that is a big if, Food Corporation ofIndia (FCI) can effectively procure food grains atMinimum Support Price (MSP) from all over thecountr y, farmers would have the incent ive toproduce food grains. Since, at present , FCI largely

operates only in few selected states, farmers in otherstates often get a price lower than the MSP. Thosewho were not covered earlier would now get ahigher pri ce and would have the incent ive t oproduce more.

Would this wipe out hunger?

It will depend on how effective is theprocurement of food grains at minimum supportprice (MSP). If procurement is 100 percent effective,market price would be at least as high as MSP. To-day,procurement operations are effectively carried outonly in few states and districts. The impact onreduction of rural poverty and by implication,

hunger will depend on the addit ional coverage and isdif ficult to assess but is likely to be small .

Would it wipe out malnutrition?

Even if the additional income is spent onnutritious food, malnutrition would not be wipedout. An extremely important factor in malnutrit ionin India is the disease environment to which childrenare exposed. It is estimated that within a squarekilometre some 200 persons defecate openly. Till thisis cont rolled, increasing food consumption couldhave only marginal impact on malnut rit ion as can beseen from the incidence of child malnut ri tion evenamong the richer classes. Right to a latrine may be

more important than FSB for reducing malnutrit ion.

IMPLEMENTING THE FOOD SECURITY ACT

In t he last decade, a str ong movementemerged in India - led by left political parties,

academics and non-governmental organizationsforestablishing a universal right to food. It was thispressure that culminated in the draft ing of t heNational Food Security Bill 2011, which waseventually passed by Parliament in September thisyear, becoming the National Food Security Act, 2013.

The Food Securit y Act is a first step in ensuringthe universal right to food. While I have reservationsabout the Act, and specifically about targeting andthe exclusion of a substant ial sect ion of t hepopulation from the right to food, I shall focus fi rston the pressing issue of implementation of the Apt.

In implementing the Food Securit y Act, thereare some important lessons we can learn from theBrazili an experience. Brazil was in fact the fi rst

country in the world to legislate- a right to food.This was part of t he now-famous Fome Zero or ZeroHunger Programme of the Brazilian governmentthat has become known worldwide as a majorsuccessful intervention in the sphere of food securit y.In 2010, by means of a Consti tutional Amendment,the right to food was added to the list of socialrights in the Brazilian Constit ution, thus providing apermanent legal basis for interventions such as theZero Hunger Programme.

The core of the Zero Hunger Project was anappropriate combination of structural policies andcompensatory policies. The need for such a

combinati on came from the understanding t hathunger in Brazil stemmed from three main factors:the specific pattern of growth resulting in lowaggregate demand on account of high incomeinequalities and unemployment; low purchasingpower on account of t he relation between foodprices and wages; and the exclusion of the poorestsections of society from the market (Swaminathan2012).

The key to the success of the Zero HungerProgramme was strong political commitment.Ending hunger was viewed as a national issue and asa social rather than an individual concern. Early inthe new Presidency, three special bodieswere createdto implement the Programme: an ExtraordinaryMinistry of Food Security and Hunger, a NationalFood Securit y Council (with 18 ministers of State and36 non-government representatives) and a special


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advisory body to the Presidency. This step reflectsthe polit ical import ance given t o the Programme.

The implementation of the Food Securit y Actwill require resources in cash and kind. It follows,then that fiscal allocations will have to rise, if the Actis to be implemented properly. The crit ics of the Acthave already pointed on the burden of foodsubsidy on the exchequer. The Economic Survey ofthe Government of India 2013 states that the foodsubsidy bill is putt ing a huge stress on the fiscalside. However, the food subsidy, as defined in theGovernment of Indias budget (the operationaldeficit of t he Food Corporation of India), has rarelyexceeded 1 per cent of GDP over t he last threedecades (except in 2011-12, when)t went slight ly

above one per cent .In conclusion, unl ess t here is polit ical

commitment, backed by financial resources, the FoodSecuri ty Act wil l not lead to major changes in foodinsecurity in the country. Further, as the Act isimplemented, the defi nit ion of t he prior it y ortargeted population needs to be kept f lexible, toallow State governments and local governments, toidentify food insecure populations and give themaccess to a minimum quant it y of subsidized food.

LEGAL

RECOGNITION OF STREET VENDORS

The Street Vendors (Protection of Livelihoodand Regulati on of St reet Vending) Bil l that wasintroduced in t he Lok Sabha on 6 September 2013is a landmark for protection of this important sectionof t he urban poor. The bil l is an outcome of theconsistent effort s of organisat ions such as SelfEmployed Womens Association (SEWA) and NationalAssociation of Street Vendors of India (NASVI) whohave, for over a decade, been pressurizing thegovernment to grant legal recognition to streetvendors.

Why Street Vendors?

Over the past few decades we can observe that

there is substantial increase in the number of streetvendors in the major Indian cities. Mumbai and Delhihave around 250,000 each. In fact, the Nat ionalPoli cy of Urban St reet Vendors, 2009 and t hepresent bill state that around 2.5 percent of t he

urban population is engaged in street vending.There is also another section of the urban

population that has taken to street vending. Thesepeople, or their spouses, were once engaged in betterpaid jobs in the formal sector. Most of them wereemployed in the textile mills in Mumbai andAhmedabad and engineering firms in Kolkata.

Main Features of the Bill

The most important body at the local level isthe Town Vending Committee. This will be the focalpoint of t he policy as it will decide on issues such asissuing of certificates to vendors, deciding on areasfor street vending and the amount to be collected asfees/t ax from vendors, besides a host of other

act ivit ies. The Municipal Commissioner/ ChiefExecutive Officer of the local body will be thechairperson. Representatives of street vendors willcomprise 40 percent of t he total membership whilecivil society representatives (NGOs and CBOs) willconstit ute 10 percent.

The first function of the TVC is to conduct asurvey of existing street vendors (Section 3). The TVChas to ensure that all existing vendors areaccommodated on the pavements or other placesselected for the purpose. No street vendor wi ll beevicted t il l the survey is completed.

Section 5 of the bill states that the personwho is awarded the cert if icate alone has the right t ovend. The vendor must not have any other source ofincome besides street vending and the minimum ageis 14 years the person cannot give the certif icate toothers. The exception is if the person is ill orbecomes physically disabled to vend, the children orspouse can take up the trade. This is an importantpoint as it wil l prevent spaces being given to othersat a price.

Another import ant issue is evict ion andconfiscation of property. This is the most dreadedfear f or any st reet vendors. The municipalauthorit ies come in vans or t rucks and swoop downon illegal vendors and confiscate their goods.

The bill states in Section 5 that evictionshould be the last resort . If street vendors in alocality need to be relocated due to genuine reasons,they have to be provided alternative sites. In casesome vendors refuse to move they will be issued a


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noti ce that they should move within a specifi edperiod. If this fails, the local authorit y may impose afine of Rs. 250 a day. If even this is not a deterrent,the authorities may forcibly evict them. However,there are clear rules regarding eviction andconfiscation of goods. The authorities must providethe vendor with a signed seizure list.

Thought the TVC is the most powerfulauthority dealing with recognit ion and regulation ofstr eet vending, there is a need for r edressal ofgrievances. Section 20 notes that every cit y/town willhave a Grievance redressal Committee with a formercivil judge or judicial magistrate, who will chair thecommit tee. There will be two other members whowil l be professionals but wil l not be employees of the

government of local body. This commit tee will hearon cases relat ing to appli cat ions (cert if icates ofvending).

In order t o promote street vending, the TVC,in conclusion with the planning authority wil l preparea plan for str eet vending every f ive years. It isimportant that the plan will not be used toadversely affect the street vendor.. this aspect is veryimportant f rom the point of town planning.

In the case of eviction we find t hat the policehas greater powers. Section 34 of t he Indian PoliceAct states that the police can remove any person whooffers goods for sale in publ ic. Each state has

incorporated this clause in i ts police act. This impliesthat even if the local authorities allow street vendorsin a particular street the police can evict them underprovisions of this clause.

Conclusion

We have not attempted an exhaustiveexplanation f the bill. There are many more issues.For example the first schedule provides details on theplan for street vendors and the second schedule dealswith the scheme for street vending that each stategovernment should undertake. There are also otheraspects in the bil l that we did not elaborate on. Wehave tr ied to lay down the main issues that the bil l

deals with.There are also some adverse aspects. The bill

excludes railways from its purview. This isunfortunate because licensed vendors have been animportant part of rail travel, especially for the poor.

We find that in most large railway stations vendorsof tea and snacks have been replaced by brandedkiosks such as Cafe Day or similar ventures. Theprices of drinks and snacks are at least three timeswhat the vendors charged. Similarly, the food servedon the long distance trains has become expensiveeven for middle class passengers. Licensed vendorscould provide facilities at much lower rates.

Street vendors are asked to keep their vicinityclean, but a major problem for most vendors,especially women vendors, is lack of toilets. For foodvendors, running water is needed for cooking andcleaning. The bill could have made special provisionfor these. The expenses could be recovered from thefees charged. Women working as vendors stay on the

street the whole day. They are unable to easethemselves and as a result suffer from disease.

FDI REFORMS IN INDIA:

STEPS IN THE RIGHT DIRECTION

One of the remarkable features of globalisationsince the 1990s has been the flow of private capitalin the form of foreign direct investment (FDI), whichis an important source of development finance fordeveloping countr ies, and which contributes toproductivity gains by providing new investment,better technology, management exper t ise, andexport markets. Given resource constraints and lack

of investment in developing countries like India,market forces and the private sector are increasinglybeen relied on as the engines of economic growth.Foreign di rect investment promotes economicgrowth by increasing investment and its efficiency.Therefore, all countries, more so developingcountries and least developed countries (LDCs), seekFDI. Foreign investment , especially FDI, not onlysupplements domest ic investment but acts as asource of foreign exchange and eases pressure on thebalance of payments (BoP).

Considering the economic benefits of FDI,India has adopted wide-ranging reforms since theearly 1990s and more so in recent months to attract

FDI to ease the pressure of rising current accountdef icit (CAD), depreciati ng rupee, st agnat inginvestment, and the slowdown of the growth rate.Although India was selectively receptive to FDIbefore the 1990s, successive Indian Governments


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realised that FDI is an important determinant ofinvestment, economic growth, and employment, and

therefore acted as a facili tators since the 1990s.Some of the recent reforms such as FDI in retail ,insurance, civil aviation, broadcasting services, etc.are welcome steps and will have significant outcomesin years to come. However, some signif icant issuesremain, which need to be addressed to realise Indiaspotential in attracting FDI as China, Singapore, orBrazil does.

Importance of FDI: A Macro View

Economic growth in any count ry dependsupon the sustained growth of productive capacit y,supported by savings and investment. Foreign directinvestment, which brings new t echnology andknowledge along with capit al, is considered a goodsubstitute for debt in developing economies forhigher investment and, thereby, growth.

In traditional Solow-type standard neoclassicalgrowth models, FDI is considered an addit ion to thehost economys capit al stock and facili tates theincorporation of new inputs and new variet ies ofint ermediate goods in production.

The li terature on technology transfer identif iesfour main channels of technological spil lovers fromFDI to the host country-(1) learning by doing; (2)competit ion; (3) labour skill s; and (4) l inkage-although, in practice, it is rather difficult to

dist inguish between these four channels. The directroute through which FDI contributes to growth isinvestment based on the crowding in hypothesis.

Further, PDI helps integrate developingcountries int o the global economy by easing access toforeign markets and including local enterprises inglobal production chains. The FDI inf lows to EastAsia helped modernisation of the exports sector ,more so the manufacturing sector, leading to growthin exports as well as overall economic growth.Therefore, FDI contr ibutes to improving the hosteconomys export competit iveness and volume by (I)augmenting domestic capital for exports; (2) helping

transfer of technology and new products for exports;(3) facilitating access to new and large foreignmarkets; and (4) providing t raining for t he localworkforce and upgrading technical and managementskills.

FDI Reforms in India: A Brief Summary

Though India had been receptive to FDI sinceindependence, unt il 1991 FDI policies were designedto meet domestic requirements and were ad hocwithout any consistent direction or properinstitutions. The new economic policy of the early1990s, triggered by the 1991 BoP crisis, aimed atcreating a conducive environment for-foreigninvestors, initially by raising foreign equity caps inmany sectors, diluting provisions of the ForeignExchange Regulation Act (FERA), and allowing.automatic approvals (Sahoo etal, 2013;2012a); The1991 reforms were a big bang approach intendedto attract FDI t o modernize Indias industrial base,improve export competit iveness, and integrate theIndian economy with the rest of the world.

During the post-reform period, a number ofcontrols were dismantled in t he areas of industrialpolicy, taxation, export-import policy, and foreigninvestment . The de-licensing of industr y, de-reservati on of t he publi c sector , easing ofcompetit ion controls, trade reforms, deregulation ofint erest rates, and opening up of capit al marketswere some of t he reforms undertaken to encourageinvestment and capital formation. Furthermore,FDI policy is now reviewed on a regular basis andchanges in sectoral policy or sectoral equity caps arenoti fied through Press Notes by the Secretariat for

Industrial Assistance (SIA) and the Department ofIndustrial Policy and Promotion (DIPP).

Some major FDI reforms are listed below. Industrial l icensing has been abolished and

many sectors opened for foreignparticipation, except for a few industries onthe ground of strategic and environmentalconcerns. After 2000, sectors marked forautomatic approval of FDI were expandedto include most sectors, and foreign equitycaps raised to 100 per cent.

The FERA was revamped int o the ForeignExchange Management Act (FEMA) in 1999

to facil it ate foreign exchange managementin the capital account. Automatic permission for high technology

agreements or technological collaborations


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in priorit y sectors and removal of condit ionsrelated to technology, such as restr ictionson FDI in low-technology areas.

The Reserve Bank of India (RBI) int roducedan automatic approval channel for 100 percent foreign equity in priority sectors. Theautomatic route has been extended to upto 51 per cent foreign equity in prioritysectors.

Abolition of high local content requirements,dividend balancing requirements, andexport obligation condit ions except for 22consumer goods. The condit ions on 22consumer goods were subsequent lywithdrawn in 2000.

Major insti tutions set up to promote andfacili tat e FDI inf lows, such as ForeignInvestment Promot ion Board (FIPB),Foreign Investment ImplementationAuthority (FIAA), and SIA.

Privatisation of public sector. Aggressive signing of bilateral investment

and double tax avoidance agreements(current ly with 69 countries) to benefit andassure foreign investors. The law ontrademarks and the Geographical Indicationsof Goods passed in 1999 t o protectintellectual property rights.

Fiscal incentives such as tax subsidies andconcessions offered by both central and stategovernments to foreign investment.

Reforms at the state government level andinstitutions established help implement FDIprojects.

Recent FDI Reforms

The past few years have witnessed a slowdownin investment and growth in India owing to the globalfinancial crisis, policy paralysis, and deterioration ofbusiness environment. Consistent deficit s in tradeand curr ent accounts along wit h weak macrofundamentals result ed in a sharp fall in the value of

the rupee and business conf idence. Realising t heseriousness of the situation, the Government ofIndia (GoI) has pursued aggressive policy reforms,including in FDI, to regain the confidence of bothdomestic and foreign investors. Some reforms such

as the revision of fuel prices, allowing 51 per cent FDIin mult i-brand retail ing, all owing int ernationalairlines to invest in domestic airlines, hiking FDIequity in broadcasting services from 49 per cent to75 per cent , disinvestment of four public sectorundertakings (PSU), etc, are nothing less than bigbang reforms. Though each major policy decision iscontentious, pushing through all these long-pendingreforms would certainly bring back investorsconf idence and growth momentum i n the nearfuture.

Some major FDI reforms since September2012 are listed below.

Allowing 100 per cent FDI ownership insingle brand retail trading and up to 51 per

cent FDI in mult i-brand retail t rading. Allowing foreign airlines up to 49 per cent

FDI in the capital of Indian companies in t hecivil aviation sector operating scheduled andnon-scheduled air transport .

Increasing FDI equity f rom 49 per cent to74 per cent in certain broadcasting sectors.

Allowing up to 49 per cent FDI in powerexchanges registered under t he CentralElectricity Regulatory Commission (PowerMarket) Regulations, 2010.

Increasing FDI limit in the insurance sectorfrom the current 26 per cent to 49 per cent.

Allowing 49 percent FDI in several sectorssuch as pet roleum and natural gas,commodity and stock exchanges, powerexchanges, asset reconstruction, single brandretail , and t elecommunicat ions. Foreigninvestment up to 49 percent in theseindustries may be made under the automaticroute, which does not require approval fromthe RBI or t he Indian government.

Sectors such as asset reconstruction andtelecommunications are eligible for 100 percent FDI upon approval by the FIPB.

The defence sector will also be eligible forgreater FDI under the recent changes. Whilethe standard cap for the sector remains 26percent, according to a government pressrelease, the Cabinet Committee on Securitywill be allowed to approve defence projects


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for up to 100 percent FDI if the projects arelikely to result in access to modem and stateof the art technology.

Furt her increases in the pension sector havebeen proposed and await parliamentaryapproval.

Implications of FDI Reforms

The comprehensive reform of FDI policy since1991 has resulted in a substantial increase in FDIinf lows int o India-from less than US$1 bil li on in1991 to US$42 bill ion in 2008 but slowed down afterGlobal Financial Crisis reaching US$27 bil lion in2012. The per capita FDI stock also rose dramaticallyfrom less than US$ 1 per person in 1991 to US$ 188

in 2010. Alt hough presently ranked third, India wasranked the second-most desirable FDI destinationfor many years. Further, actual FDI inf lows as apercentage of the approvals, which used t o benegligible before 1991, have become substantialduring the post-reform period, particularly since2000. The number of source countries of FDI hasincreased from 29 in 1991 to 130 in 2012, whichshows the enhanced interest of foreign investors inthe Indian economy (Sahoo et al, 2013).

The recent FDI reforms will have implicationsin future. The clearance of 51 per cent FDI in mult i-brand retailing in September 2012, which wasapproved by the Cabinet in November 2011 aftertwo years of deliberation but suspended due to theensuing political furore, is a big step and will changethe way business is conducted in India. There aremany economic advantages, particularly forconsumers and producers. The scale economies andassured supply chains of organised multi-brandretail ing would offer better varieties of products atlower and stable prices to consumers.

Challenges and unfinished Agenda

Though FDI inf lows to India have increasedover last two decades, India still lags behind countrieslike China, Singapore, or Brazil. FDI inf lows to India

are st il l concent rated in a few sectors and a fewstates because of unresolved issues and India is yetto receive FDI inf lows to its full potential. With all theadvantages India has, there are still factors and issuesthat hinder FDI f low into India, including

infrastructure bott lenecks, rigid and complicated labour laws, lack of coordination between the centre and

states, FDI caps/ceilings in many sectors where 100

per cent FDI equity is not allowed for feasibleinvestment projects, and

diff icult bureaucratic contr ols andprocedures to get the necessary Clearancesand approvals. First-time investors in Indiaare always sceptical about whether projectswill progress from screening to operation.

The establishment and strengthening of the ofFDI insti t uti ons such as Foreign InvestmentPromotion Board (FIPB), Secretariat of Industrial

Assistance (SIA) and Foreign investmentImplementation Authority (FIIA) to facilitate FDImoving beyond approval to implementation hascertainly helped. However, the next level of reformsand policies need to address these issues and set upappropr iate insti tut ions. Some of t he necessaryreforms are:

a bett er environment for infrast ructuredevelopment with an appropriateinstitutional framework such as a disputeresolut ion mechanism, independentregulatory authorit y, and special investmentlaw;

a Uniform Labour Code aft er anindependent review and proper consultationwith stakeholders; proper design andplanning of SEZs, including local levelsolutions for land acquisition and sector-specific policies with incentives to attract FDIinto SEZs;

proper infrastructure connectivit y to SEZsand allowing the private sector to provideinf rastructure services to SEZs;

increasing FDI caps in sectors with FDIpotential and allowing more sectors underthe automatic route;

revisiting outdated laws, controls, regulatorysystems, and government monopoliesaffecting the investment environment;

encouraging non-governmental facil itationservices for foreign investors; and


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furt her t rade reforms and reforms in publicservices to attract foreign investment.

Overall, India needs to address its lack ofadequate infrastructure, rigid labour laws,bureaucratic delays, and state level reforms torealise it s FDI potential.

ELECTRICITY PRICES IN INDIA:

COMPARING APPLES, ORANGES, AND LYCHEES

Economics of Power Generation

Compari ng Sources of Power

Economics uses the term fungibility todescribe how well something can be substituted withsomething similar (rather, identical). Commodit ies

are often thought of as fungible. Is electricityfungible? At one level, a unit of power (a kilowatt-hour, or kWh), is often viewed so. But it isnt, at twolevels - both generation as well as supply in to thegrid.

At the grid side, when, where, etc. and withother technical characteristics it turns out that coalplants versus hydro versus solar etc. are dif ferent.Consumption of electricity clearly depends onlocation and time. While transmission is meant tominimize impacts of location, grid constraints (andcosts) mean a generat ion source nearer loads issuperior, and if such generation were on-site, thenthis would avoid almost all the transmission anddistr ibution (T & D) losses.

Probably t he best descript ion ofdifferentiation of power is the analogy to fruit . We(today) think of electricity like selling fruit (Rs./ kWh)but the basket we sell is actuall y a mix of apples,oranges, lychees, mangoes, etc. each with differentcost and other characteristics. Blending the supply asper t heir respective shares may work f rom anaccounting perspective, but it masks importantsignaling about marginal costs as well as othercharacteristics of t he power.

At the production side, plants dif fer based notjust on cost, which well explore further, but also

lifespan, external impacts, land usage, etc. Whileexternali ties such as pollut ion are a known market-failure, shouldnt land, li fespan, etc. be captured inthe economic calculations.

Some Cost Number calculations

There are two major types of expenses forcategorizat ion, capital expenses (aka capex) andoperating expenses (aka opex). Opex includes fuelcharges (if any), operations and maintenance (O&M),salaries (often bundled within O&M), etc. Both setsof costs oft en vary by size of plant, wit h modesteconomies of scale upto a threshold which varies bytechnology.

Capital costs include the total costs, includingany int erest during construction (IDC), which can becapitalized. This investment is typically a combinationof debt + equit y (e.g., in a 70:30 ratio). Debt has tobe repaid at an interest rate, and equit y also requiresa rate of return, e.g., 16 percent. For simpli fication,we can consider weight ed average cost of capit al(WACC), or project cost of capital.

The f ir st wri nkle in all these numbers isuncertaint y. This has a number of components,including:

(a) Generation (per annum)this is oftencaptured in the statistic Plant Load Factor(PLF), e.g., the target for large plants likecoal or nuclear being ~80 percent, while forsolar 20 percent is considered reasonable.Actual generation will vary based on plantcondit ions, demand (off take), fuel (input)availabili ty, etc.

(b) LifespanMany plants can be refurbishedor improved wit h a modest expenditure, sothe calculation of lifespan should be finalli fespan, factoring in such renovation as amid-service cost.

(c) Fuel costsit is hard to predict the priceof fuel over the life of a plant. Simplif icationsinclude projecting this as a ratio or multiplierof the inflation rate, which is itself anunknown.

(d) O&M coststhese are also simplified asgrowing at or near inf lation.

(e) Foreign exchange fluctuations (if applicable)

etc.We levelize the costs. Levelizing appliesdiscount rates to cash flows and energy outputs thatcan vary overt ime to make them comparable.


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The most common calculation is the levelizedcost of enery (LCOE), shown below as per theInternational Energy Agency. Assume we know, withreasonable certainty, the output and operating costsfor a plant, as well as its lifespan. Cash flows is thefuture on a nominal basis must be discounted (at achosen discount rate) to be brought into presentvalue.

Recommendations for

Comparing Generation

While our focus has been on generation, onecan use retail t arif fs to help understand why a simplecomparison can be misleading.

Some qualities that may have value beyond

that captured in LCOE comparisons include:

Detachability Predictability Time period to install Carbon impact Future escalation of costs (fuel, foreign

exchange, etc.) Domestic component (Capital, know-how,

fuel, etc.)In the long run, elect ri cit y will need to be

viewed very dif ferent ly t han t he commodit ypeople think it is. More than different fruit s (types ofelectricity), electricity is an enabler for servicessuchas heating, cooling, lighting, pumping water, etc.Such a change will allow the proper value of savingenergy, dubbed negawatts, and proper investments

in efficiency, smart grids, etc.

IMC ANDQUEENSLANDUNIVERSITYOFTECHNOLOGYSIGNINTERNATIONALCOOPERATION

AGREEMENTFORTRAINING& CAPACITYBUILDING

Indian Institute of Mass Communication (IIMC), New Delhi and Queensland University ofTechnology (QUT), Brisbane, Australia have signed an International Cooperation Agreement tocoll aborate in academic programmes and in f ront ier areas of r esearch in Media andCommunication. The agreement envisages bringing ICT in academic programmes in a significantway. Both the institutes have agreed for the development of joint venture projects and also foropening avenues for developing a collaborative doctoral programme to benefit students andfacult y. The bilateral cooperation agreement also envisages organization of joint academic andscient if ic activit ies, such as, courses, conferences, seminars, symposia or lectures, exchange ofstaff and students and exchange of materials and publications of common interest.

This is the first agreement signed by IIMC seeking international collaboration and part nershipwith a foreign universit y. The agreement aims to facili tate a two-way value added t raining andcapacity building programme in the field of Mass Media & Communication. This cooperationagreement shall be valid for f ive years from t e date of signing. It shall be reviewed six (6) monthsprior to expiry and may be renewed for a further term by mutual agreement.

DEVELOPMENT ROADMAP

PMG CLEARSIMPORTANTPROJECTS

About 128 projects worth over Rs. 4.30 lakh crore have been cleared by the Prime MinistersProject Monitoring Group (PMG) so far. The PMG, set up to track stalled large investmentprojects, has given priorit y to projects from the power sector by clearing all issues relating to 94projects, entail ing an investment of over Rs 3.80 crore.Other projects cleared relate to 34 projects in oil and gas sectors, railways, steel, roads andhighways, shipping, civil aviation and mines, involving investments of over Rs 50,000 crore. ThePMG was set up in June to facilitate and work towards resolving specif ic issues of projects andfast-tracking them. Some of the projects cleared include the Rs 12,000 crore project for


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development of new terminal buidling at the Mumbai airport , and the Rs 4255 crore Lumding-Silchar guage conversion project of Railways which is aimed at providing seamless connectivit yto lower Assam and Tripura, Mizoram and Manipur with the rest of India

CORPUSFUNDFORGREENING FORTEXTILEPROCESSINGUNITSAPPROVED

An Integrated Processing Development Scheme (IDPS) with a corpus fund of Rs 500 crore tomake textile processing unit s more environment friendly and globall y competitive has beenapproved by the Cabinet Committee on Economic Affairs (CCEA). The fund, meant to addressenvironmental issues faced by text il e proecessing unit s, will be used to set up four t o sixbrownfield projects and three to f ive green f ield projects wil l be set up under the projects overthe 12th Plan period. The eligible projects under t he scheme would cover Common Eff luentTreatment Plants, capt ive power generation on technology preferably renewable/greentechnology, infrastructure such as storm water management , necessary roads and pipelines forwater and wastewater and facili ty for t est ing and R&D centres. The scheme will supportupgradation of existing processing clusters/centres specifically in the area of water and waste

water management and also encourge reaearch and development work in the textile processingsector.

ROADPROJECTSCLEAREDINPUNJABANDMAHARASHTRA

The Cabinet Committee on Economic Affairs approved road-widening projects worth over Rs3,000 crore in Maharashtra and Punjab. Four-Ianing of the Aurangabad-Yadeshi Highway - 211in Maharashtra will be done under the National Highways Development Project (NHDP) PhaseIV on Build, Operate and Transfer basis. The estimated cost of the 190-km project is Rs 2,406.63crore and would include the cost of land acquisition, resettlement and rehabilit ation and otherpre-construction activities.The proposed highway between Sangrur (Punjab) and Haryana border will cost Rs 612.28 crore,including the cost of land acquisit ion, resett lement and rehabili tation and other pre-constructionactivit ies. The total length of the road will be approximately 57 kms.

TISS DEGREEFORSECONDPMDRF PROGRAMME

The Prime Ministers Rural Development Fellowship (PMRDF) programme was revamped withthe launch of its second version in which fellows wil l get a degree from the Tata Institute of SocialSciences. Apart from covering the Naxal affected districts, the PMRDF would also cover theNortheast region.

FUNDSALLOCATEDFORUPGRADEDPMSSY PHASEIII

About Rs 5,071 crore has been allocated under the Pradhan Mantri Swasthya Suraksha YojanaPhase III for upgradation of facili ties in 39 medical instit utions and colleges across the countr y.The upgraded scheme, aimed at boosting medicare infrastructure in the country, will beundertaken across 20 states within 43 months. With this, the total number of medical institutionsand colleges to be Upgradedn!Oes7to 58 at a cost of Rs 7,111 crare as 19 have already beenundertaken in the first two phases of the scheme.


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DO YOU KNOW?

WHATIS3 D PRINTING

In this process, a three dimensional solid object of any shape is made from a digital model. It isalso known as additive manufacturing. It is an additive process, in which successive layers ofmaterial are laid.3 D print ing technology has been increasingly gaining ground. Sequent ial layering for creation ofthree dimensional objects in any shape led to the use of the term addit ive manufacturing.Addition or joining of plates, sheets, forgings has been tradit ionally used for fabrication of objects,but the unique thing about 3 D printing has been the use of information technology. Creatingexact shapes with high precision from a remote cont rolled command gives an edge to thistechnology. This technique has been called magical as it can create objects out of thin air. It canprint material in plastic or metal. I t is a sort of manufacturing revolution. For instance, if weneed a part of some machine, it needs to be imported all the way from the country of its

manufacture. However, in future this technology has the potential to 3D print at our end thepart of the machine we need.3 D printers use a variety of addit ive manufacturing technologies and build a three dimensionalobject t hrough successive layers. It takes vir tual blue print s from computer aided design oranimation modell ing soft ware. Layers of constit uent material are deposited or heaped andshaped as per the design. There is a date interface between CAD software and the machines. Whilegenerating t he printout, t he printer reads the design and forms it by laying successive layers ofliquid, powder, paper or sheet. Any shape or geometric feature can be formed in this way. 3 Dprinting is not just prototyping. It offers transformative advantages from the stage of conceptdesign t o production.3 D printing is getting popularity and 3 D printers can be easily purchased in some countries. Thismethod is hoped to revolut ionise the fields of manufacturing, education etc. It shall have impacton many industries. In the teaching rooms, the students can, for instance, design their own 3 d

molecular structures. This will help in better understanding of the things and in getting clearconcepts.

INDIAN BIOMASS RESOURCES AN

ASSESSMENT FROM THE GRASSROOTS

There exists an ardent need for t hedevelopment of carbon neutral fuels in view of t henon-sustainable economy of fossil fuels primarilyfrom climate change considerations. Biomass couldprovide a bouquet of environmentally benignsolut ions to cater to the countrys energy needs.

Several t echnological options are available forbiomass conversion to energy directly, in the form of

heat or electricity or to other forms, such as liquidbiofuel or combustible biogas.

Data Sources and Methodology

While considering an alternative biofuel

scenario, it becomes an essential prerequisite toensure a regular availability of biomass feedstock.For sett ing priorities in technology development inthe sector , a comprehensive assessment of Indianbiomass resources for their conversion into energy,fuel and other bio-products assumes importance.

The overall assessment for t he surplusbiomass resources was based on estimation of thequant it y of crops produced, crop residues generatedand their existing util ization patterns/practices in

the area. Biomass residues generation, consumptionand surplus density were calculated based on per sq.km availabilit y of biomass in f ive states, identif ied onthe basis of secondary data of production of selectcrops.


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Biomass Residue Generation

Agriculture being an import ant economicactivity in India, along with the crops largequant it ies of residues are generated every year.Processing of agricultural produce through mill ingetc. also produces substant ial amount of biomassresidues, which are vital sources of energy both fordomestic and industrial purposes.

In India, a total of 623.4 Mill ion Metric Tons(MMT) of biomass residues was generated from thecrops. The rice straw and husk, wheat straw,sugarcane tops and bagasse account for almost 80percent of the residue generated by the crops. Thetop four states in terms of biomass generation areUP, Maharashtra, Punjab and AP. The following arethe biomass residues generated by different crops.

Table 1: State-wise crop residues generation

State Generation (MMT) Top 3 Residues

Uttar Pradesh 138.0 Wheat st raw, Bagasse, Sugarcanetops

Maharasht ra 81.7 Sugarcane tops, Bagasse, Oi lseeds

Andhra Pradesh 44.2 Wheat st raw, Ri ce husk

Punjab 41.5 Rice straw, Bagasse, Sugarcanetops

Tamil Nadu 40.3 Sugarcane tops, Bagasse, Ricestraw

Karnataka 39.1 Sugarcane tops, Bagasse, MaizeStover

Madhya Pradesh 38.1 Wheat st raw, Pulses, Oi lseeds

Rajasthan 33.8 Rice straw, Oil Seeds, Bajra

Gujarat 30.9 Cotton stalk, Wheat straw,Bagasse

Haryana 29.6 Wheat straw, Maize, Stover, Ricestraw

Others 106.2 Wheat straw, Rice straw, Rice husk

Biomass Resource Consumption

Crop residues offer good economic values tofarmers as they are consumed as animal feed, composting, thatching for rural homes and fuel fordomestic and industrial use, etc. Farmers use agri-residues either themselves or sell it to other landlesshouseholds or int ermediaries, who in. turn sell the

residues to industr ies.

The surplus non-fodder type crop residues areburnt in the field i tself . Biomass burning has been asignificant global source of atmospheric aerosols andtrace gas emissions, which have a major impact onclimate and human health. In addit ion to aerosolpart icles, forest f ires and crop residue burni ngcontribute to the generation of carbon dioxide (CO),carbon monoxide (CO), methane (CH

4), volatile

organic compounds (VOC), nit rogen oxides andhalogen compounds.

Availability of Surplus Biomass Resources

Nearly 165 MMT is estimated as surplus cropresidue available in India in a year; this being 26.4percent of overall biomass residue generation.

Sugarcane tops constitute the most available surpluscrop residue fol lowed by oilseed residue, cott onstalk, rice straw and wheat straw. An addit ional 4MMT of main bamboo plant would be available aspotential biomass.

Biomass Residues: Collection &

Transportation

Uti lization of biomass residues for biofuel orfor other applications requires a reliable, long-termand economically viable feedstock. But theavailability of biomass residues from agriculturebeing seasonal in nature, there is a need to procureand store required quantity of biomass within the

stipulated t ime.

Conclusion

The biomass residues are important resourcesas feed for animals, fuel, fertilizer and as an industrialraw material. As noted from the data there is ashort age of cattle fodder in India so the biomass isunlikely to be available in large amounts for biofuelproduction unless specifically grown for the purpose.Hence, the focus should be on non-fodder cropsnamely, sugarcane tops, cotton residue, chill i, residue,pulses residue, oilseeds residue (select) and bambooresidue.


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