saywhatyouneedtosay

Jal arrives and the music begins

2010-11-28T04:30:00.002-08:00

Ik Din Ayega, oh yes the day will come but before that let us hope that we will not have to deal with more of the kind of Jal, the cyclone storm that just plagued Chennai for the whole of this Sunday, because invariably the city planners of Chennai did very little to help the growing city adapt to deal with some, if not all of the natural hazards this part of the world is increasingly becoming prone to.

Yes, your thoughts quite like mine might be drifting towards the Bheegi Yaadein of the Mumbai incident. No No, not that one but of the 26/7, that’s right the floods of 2005.

The incident was a simple one, heavy (994mm) incessant (for 24hr) rain plagued Mumabi on the 26^th and the 27^th of July; and world the witnessed the plight of the suffering Mumbai residents.

Roughly 22% of the land was flooded. All roads where flooded, rail was non-operational, airport closed down for 2 days and thus the transportation infrastructure ceased to be useful. Telephones (wired and mobile) stopped working the public address system was never effective and the people were effectively cutoff from the rest of the world. Some of the power stations were flooded and a few of the power lines were broken. With the effect Mumbai was dark, deaf and stuck. The situation undoubtedly complicated as hours passed by, no food reached the people and there was this growing concern of an epidemic, given the fact that the sewerage has merged with flood water.

So, let us try and see what went wrong.

First we ought to look at the rain itself. Was the rain on this spiteful day any different form the rain jo Mumbai ko Adaat hai? Well, technically this was a rain of a different kind as this was the 8^th highest 24hr period recorded rain ever. The next; could the MET department have told us about the coming rain, at least in theory? Well perhaps. But then the important question is would the few hours’ notice be of any use? Or in other words does Mumbai’s century old storm water drainage system have, at least in paper, the needed capacity to deal with the effuse of this kind? The answer is No, its design capacity is about 25mm drainage per hour (it rained hard, 994mm in 24hrs).

Wonderful, now that things have cleared up, was the authorities in charge aware of this impending danger? Undoubtedly yes. In fact there was this McKinsey report that brought to daylight the steps to be taken to turn Mumbai into Shanghai where this small but exceedingly relevant issue of the need for expanding the drainage capacity was pointed out. In addition Brihanmumbai Municipal Corporation had commissioned a UK based firm in 1990 to look into this issue and a project a INR 600 crore project was proposed and soon scrapped(in the name of cost of course;Note direct flood damage ran into abut INR 450 crores)

Beautiful, now that we have successfully convicted the lack of infrastructure for the case of flood, lets us try and see what the infrastructure ‘development’ has actually got to do with the whole issue.

The starting is clear, the development happened and hence the demand for drainage increased to the extent that 40% of the sewerage was carried through the drainage network; slums are one of the reasons for this. The second; limited maintenance of the system; in part attributed to new development ‘on drains’, plastics and other waste clogging the drains and so on. The unplanned development of Northern Mumbai is the third and most important reason. The last but definitely not the final, of the clearing of the mangroves and the swamps which served to ‘buffer’ the effect of floods in the past. Up to 40% of Mumbai’s swamps were lost from 1995 to 2005 to builders and slums; and the effect is clear.

So the take away is that there is a lot to be done to help our existing cities cope with natural disasters and some meticulous planning should go into cities that we hope to develop in the future. For Chennai, may Jal be the vaccine will wake the authorities to reality; setting the ball rolling for the development of the needed immunity not just against flood but against all natural disasters! So let the music begin!

Reference

1. Monograph on Flood Hazard In Urban Area, Envis Center on Human Settlements, School of Planning and Architecture, New Delhi

2. http://en.wikipedia.org/wiki/Maharashtra_floods_of_2005

3. http://knol.google.com/k/floods-in-mumbai#

4. http://www.terradaily.com/reports/a060726103620.c9ebvxoi.html

5. Mumbai Floods: Another wake-up call, Shveta Mathur and Anshu Sharma, Coordinates

6. News on Jal,

7. Do visit: www.jaltheband.com

Of measuring Infrastructure Needs

2010-11-28T04:30:00.001-08:00

Well, we have people from the government parting insights that the present requirement for infrastructure as being so many crore rupees of roads and so many crore rupees of bridges and the like; and we have a group of people informing us that the major issue today is not finance but the lack of ability of the systems to absorb these kinds of amounts. I have one question?

How in the world did they end up getting the units wrong?

To me, a hardly baked civil engineer, this issue seems important. No, no I have not yet lost my mind, I am merely trying to point to the obvious; or what I think is obvious, you can’t measure the length of the road to Mumbai from Chennai in rupees you have to invariably do it km (or cm if you have the patience that is)

So I have a few questions; sticking to the metric system how much road length has to be added this year? How many more schools are to be built in the rural areas? How much more water per household should the government plan to supply this year?

Boring? Well the point is, I want it to penetrate. The fact that someone from the side of the government comes up with the length of road in rupees is worrying to me. One, because if there is an actual requirement of a 100km of road in Hogsmeade village in Tamil Nadu and the “agency”, be it the government estimator or some international agency, comes up with a statement “Hogsmeade requires 400crs of roads” then you have a problem. Because given the fact that the occupation of the residents in Hogsmeade is magical and that they can turn anyone who come to acquire their land without twice the land value as compensation into stone, it is easy to understand if I say the final project cost will run over 700crs. Now the authority involved in construction has two ways out, one build 57km and say the work is done which is largely true as he will have built for 400crs, the projected requirement; or chicken out and say I cannot absorb the funds and I have no capacity to build.

The point is the estimated project cost and actual project cost can largely vary and that matters.

So what is the way out? Well there is always an option to hire Sherlock Homes and make him look into the matter but I fear that the application of his pristine faculties would yield an explanation quite simple and indeed trivial; ‘you either need to pay a lot more attention to your estimates or you need to look into better ways of releasing funding’ is perhaps what he would advise the government authorities. Perhaps he will go to the extent of suggesting that a central pool of funds directly accessible to the contractor upon legitimate demand is the only viable solution.

However I would reexamine the delicate yet dangerous issue of the “lack of ability to absorb”. For it is a strange acquisition but might never be an illicit one, because there may not actually be the necessary capacity to absorb the funds. Then in the case, you might accuse me of unduly accusing the government; however I would refute and enlighten you with the fact that the lack of capacity is in part the making of the government and its funding mechanism.

For with the contractors fearing the no-nonsense-negotiating mechanism of the government and with their profit margins clinging to such low values, it is perfectly justified for them to stay without work than to work and make losses. There is also this strict qualifying criterion followed by the government in the selection of “qualified” contractors which is posing quite a serious entry barrier to this field; for newer contractors that is.

All in all what I wish to say is that the government needs better methods to estimate, better methods to release funding and above all it should let the contractors and the other private parties involved to take their share of fair profits. In addition it also needs a better method to estimate the likely benefits from what they plan to build as without it there can be no real cost benefit analysis with which they can try and please the tax-payers.

Reference

1. Lecture by Mr Vikram Kapoor

2. Lecture by Mr Raj Cherubal

3. “ Infrastructure requirements too large for budget provision”, Hindu

4. http://www.cvc.nic.in/3%20Tender%20Stage.pdf

Negotiators, All Hail! (nah!)

2010-11-28T04:29:00.000-08:00

The negotiation game that we did in class effectively brought to light one of the several issues that are common with negotiations; primarily the lack of clarity in communication especially, of the requirement and of the interests, among the parties involved. However, my interest today is not to reiterate this issue; nether is it to suppress its importance nor is it to enlarge the importance of another. My whole and explicit point is to negotiate a position for the ‘invisible’ part of the negotiations in the process of negotiations.

Well, issues like that of lack of communication will almost certainly be a minor factor when you consider extended negotiations; however a factor that will hold ground all the time and which always will is the part of the ‘requirement of the parties’ which forced the negotiations in the first place. For instance take the interstellar egg case that we shared in class; on the one hand ‘A’ needs it for his/her mother and ‘B’ needs it for his/her sister then would it not be wise to first implore the relation of ‘A’ with ‘B’. You may to your astonishment find that in a particular case, which is seldom uncommon, that ‘B’ turns out to be ‘A’’s long lost uncle in the distant galaxy, infrapm alpha.

My point is; you will be clear and simple, only if you need to.

This might not be easy to digest; so let me take up an example to highlight the point. The idea of negotiations between the two neighbors India and Pakistan over the Kashmir issue has been in and out of the media lately. What is the purpose of such negotiations? What the people of Kashmir want is their peace and that, they can rest assured, can never be found if they were part of Pakistan as some among them claim. So why negotiate to change the borders? Well to me, it looks like everyone involved is just trying to buy time; dust up the files and leave us in the dark.

The talking of time compels me to write about a very interesting case of Caterpillar’s Solar Turbines Inc. Negotiations ended in favor of Americans (the owners) as their Russian clients fell for the sunshine of their neutral negotiation location in France. Such external factors are important and are often manipulated to take advantage.

Another curious case is that, which is quite common, when the Asian corporate personnel have negotiations with their American or British counterparts. The Asian, quite probably a master in English in his place, will use an interpreter to communicate. Ask for a reason and I will give you two; when he speaks, his counterpart listens to his interpreter and fails to see the non-verbal cues that he may have unintentionally given away by means of facial expression had he spoken directly. On the other hand when the Asian listens, he listens twice, ones directly from the American and then from the interpreter. Also he gets double the time to think and speak. Interesting right? But does this all matter at all to negotiations? The answer is quite unclear.

But where am I taking all this to? All the way to prove that negotiations are seldom solid. All negotiators are vulnerable.

The days is not far when negotiations will be done with the push of a button; for they are now a mere excuse; done by the feeble, to be mastered by the dumb.

Reference

[1] http://en.wikipedia.org/wiki/Negotiation

[2]The Kashmir imbroglio: thinking the unthinkable, Dr Vithal Rajan

[3]Negotiating Power, Getting and Using Influence, Roger Fisher

[4] http://en.wikipedia.org/wiki/Cherry_picking

Secret of Success for Common Wealth

2010-11-28T04:28:00.002-08:00

I do not intend to talk of the secrets of success of the athletes at the Commonwealth Games. Nor will I talk of the secrets of the organizing committee of CWG in successfully recruiting langurs for security. Neither will I attempt to mimic the Shiv Khera and his splendid methods to instill success. But I will quote here a simple yet powerful quote

“Start early and begin raising the bar throughout the day.”

-Bruce Jenner (American Athlete, b.1949)

And try and see where it will get us in infrastructure, a common wealth, development .

We all know where the discussion on raising tariff ends when we talk of privatization or PPP. And it is this end that which is quite often discussed in class, of which I wish to elaborate on, today.

The idea is clear, the government or the agency that was responsible for handling the specific service, say water supply, prior to privatization or PPP, will have to begin the process of raising the tariffs before the powers and responsibilities are transferred to the partner (pvt sector).

Let us question this accepted wisdom and let’s begin by asking “Why?” and this question appears first in the form “Why PPP?” when we talk of basic services like water. The answer is in the lines of, government inability in operating the service; which almost always is on account of lack of revenue which in turn is on account of incredibly low tariff. Of course the garnishes like corruption and higher employment cost in lower wage category over industry average, is ever present, when we talk of any government but these are minor issues; after all, governments today have anti-corruption cells and if government agencies can contract hire consultants I see no reason why they can’t contract hire other category of employees and pay them suitably.

So the real reason is coming to light, lack of revenue on account of low tariff is why the government can’t run the service. And low tariff stays so long as the government runs the show; else if the tariff is raised government won’t stay. Political will is perhaps the only reason why the tariffs are remaining low. So our nostrum of starting early and raising tariff is not going to work.

And if that does not work, then I see a lot of reasons for the PPP to not work. The unrest among the masses over anti-private sentiments for essential services may get aggravated by the sudden rise in charges once the private sector takes over.

So, I believe, our cure-all should not be to start early, as it might never work; but to start low and keep rising. And to start with a low tariff, the government should subsidize the private sector heavily and pay to cover the additional cost over and above that which is recoverable from tariff. This subsidy should be gradually reduced over the years and the tariff be raised to compensate. Funny, isn’t it, when you think of it, I am asking the government to subsidize my water with my own tax money. For all you know, I might not know about this and things might just work out fine. Besides the cost I will have to pay for a screwed up PPP or poor water supply may match with/ or fall below the losses through tax inefficiency.

We still have not answered “why PPP?” yet; but as I see it

“Once the people begin to reason, all is lost”

- Voltaire

There is no need for PPP; but things seldom change spontaneously in the world and PPP might be the right reason for the government to make a little change. The government could have very well decided to raise taxes and made things better. Ah, but think of all the pockets that would remain empty.

So, does staring early ever work? Well in the case of the Chad’s Oil Troubles, I believe that things would have been better if a significant portion of the agreed investments were made by the government for public welfare in advance, well before operations began. However the question remains as to who will give the initial funding. Maybe the International Credit Agencies (ICA) could help; with the oil as security. They could satisfy their self interest in getting the companies of the country which they represent to develop Chad and its oil; and Chad in turn may develop. Later these loans could be repaid when the revenue, from the oil, starts flowing; by this way the amount of money with the government to procure arms would be limited, which is vital as we saw.

ICAs have a reason to do this; Chad can be made to this (Pressure from UN and the like) and so this has a reason to work. So take my word, Start Early for the Commonwealth.

Reference

[1] http://www.cfr.org/publication/10532/chads_oil_troubles.html

[2] http://en.wikipedia.org/wiki/Water_tariff

[3] http://www.bbc.co.uk/news/world-south-asia-11433539

Water, the price we have to pay

2010-11-28T04:28:00.001-08:00

While the films like the ‘Thirst’ take a side and portray the fate of the people who are victims of water privatizations and while the discussions in water symposiums strive to proclaim water as a fundamental right, and even still, while we question the obligation and the extent of the efforts the various government organizations put in providing water; we forget one thing, the price we have to pay for water.

I talk not of the production and distribution and delivery cost, not of the profit margins of the firms that provide water and never of the price that a person have to pay to quench his thirst; but of the price that our future generation will be forced to pay thanks to our unsustainable utilization of the invaluable resource, water.

Well where am I going with this? Did we not talk of the issue of exclusivity of water rights for a company? How unfair it was? Why not try and take this a step forward and ask ourselves as to whether this generation has signed an exclusivity agreement with the Creator.

To prove the point let me point at some statistics. Do you know how many tube wells are there in India? Well today it is close to 21 million and each year farmers who use these bring into service another million or so every year^[1]. The farmers in India (I take India because I am an India; the situation in China or for that matter any other developing country is no different than this) who a generation ago used to pull up water with bullocks from shallow wells; today use cutting edge (literally) technology to pull water from over 300m deep. What has this done? Well for the start this turned India, in less than a generation, from a place common to famine to a rice exporter.

But the other side is quite disturbing. The amount of water that is pulled out is by no means comparable to what is being replaced by the monsoons. Water table is falling; salt water intrusions are becoming a more common problem

The problem does not end here, but merely begins. Think about what happens to farmers when the water table recedes given that today they no longer rely on government water supply as it is quite often erratic and for that matter on monsoons as they are unpredictable. Then the question remains; what do they do. It is clear; and the answer is; some of them, the larger farmers dig deeper^[1] and continue to prosper, and the rest gets featured in the news.

Why is this happening? One; we can always blame the government inefficiency in providing irrigation water. Two; again we can blame the government for not monitoring and regulating water extraction from the tube wells. Three; we can yet again blame the government policies on subsidized electricity for the farmers. But four; we can only blame ourselves.

Ourselves, as the technical and intellectual leaders of the modern day world, in not being capable of providing better and more efficient and most importantly, implementable, irrigation methodologies, better variety of crops that require less water and so on.

Ourselves, as the members of the media, in unhelpfully interfering in the promotion and development and deployment of better technologies. Don’t we remember the brinjals that were all over the papers and news not so long ago?

Ourselves, as leaders of the political community in not taking into confidence the people that matter. Whether or not the projects are PPP is an altogether different issue; there are quite a few cases of water irrigation projects that were rejected by the community on grounds like, loss of reservoir land for instance, that are different from anti-private sentiments.

So what am I trying to say? Well the blame game can go on, but what is the point if there is no change in the scenario?

So the inevitable change has to happen and it needs to begin from each one of us from the farmers to the democrat to the scientists. As farmers we need to form better unions, we need to reach a consensus on the amount of ground water we would draw, we need to invest in water conserving irrigation technologies like drip irrigation. As democrats we need to monitor effectively the implemented regulations and the right kind of feedback and make the necessary amendments. As scientists we need to be concerned about the long term effects of the research that we pursue.

So as often is quoted “Before you blame others, blame yourself; Before you change other, change yourself” and as often is common in safety instructions “Before you save others, save yourself” so that we can leave something behind for future ourselves.

Reference

1. Asian farmers sucking the continent dry, New Scientist

2. http://www.thirstthemovie.org

3. http://www.pbs.org/pov/thirst/

4. Thirst, by Alan Snitow and Deborah Kaufman

5. http://en.wikipedia.org/wiki/Drip_irrigation

Give a boot to the BO(O)T toll? Board the BOAT?

2010-11-28T04:27:00.002-08:00

It is not unknown to us that the reason for the government to partner with the private sector, through schemes like the BOT, BOOT, to effectively address the infrastructure gap that exist today, is on account of the fact that the government is unable to fully finance/execute the project on its own and that the private sector does not find a viable market for the project^[1]. This forces the government to form the joint venture and facilitate and create the market for the project, using the tax payers’ money, allowing the private sector to enter. However the question is; is the whole affair fair?

What “fair” am I talking about? Well, I talk of the “fare” that is quite often collected by means of the toll to recover the cost of construction and the profits for the private sector. What about it? Well, don’t you see the delicacy of the situation here; by means of the toll, the private sector is inevitably allowing those users who pay, alone, to use the facility till the facility is transferred back to the government, thereby effectively pushing away a section of “would be users” had there been no toll. On the other hand the government in effect subsidizes the toll paid by the users of the facility with the tax payer’s rupee. So isn’t this a strong enough argument to give a boot to the toll system? Shouldn’t the government think more seriously about paying up through annuity payments? Of course we will have to live with higher taxes but we can rest assured that anyone and everyone can use the facilities.

None the less, the relative efficiency of the tax versus toll collection, in recovering the costs involved, needs to be investigated. For all you know such proposals may receive a quick and “corrupt” approval. All I want to tell is that, annuity is the right road; but don’t forget your seat belt and helmet.

On the lines of efficiency, there is yet another issue; what will the government do with the assets once they are transferred back after the concession period? The answer that came up in class was in the lines that the government may choose to run the facility or come into an agreement with a private firm for operation and maintenance. Don’t you think there is an inherent inefficiency in the process? The firm that was running the facility during the concession period would by all means be better acquainted and equipped for maintenance; however they may not be involved after the transfer. But come to think of it, permanent ownership of infrastructure assets by private firms, which is by far an existent solution, has its own set of disadvantages as discussed in class.

In this context the BOAT, Build Operate Associate and Transfer approach perpetuated by firms like the Venture Street^[2] offers a glimmer of hope. The idea is that an agreement may be formed between the private and public sector and the project may be build; following this the private sectors operates the facility, does the necessary recruitments and equipment purchases; after which the private firm forms a long term association with the government and perhaps incorporate certain key government officials in the process and at the end of it transfer the asset along with the people, equipment and other supporting facilities to the government, which later will/may function as part of the concerned government infrastructure management body. Though the BOAT was build for a different purpose and the government was never in the BOAT, there is no reason why the government can’t choose to get on board and save itself from drowning.

Reference

[1] Chapter 11: Build-Operate-Transfer for Infrastructure, Development: Lessons from the Philippine Experience ,Gilberto M. Llanto

[2] http://www.theventurestreet.com/

[3] http://en.wikipedia.org/wiki/Build-Operate-Transfer

Dam(n) the ECAs!

2010-11-28T04:27:00.001-08:00

What the Export Credit Agencies (ECA) claim to do, what they do and what they did; especially when it comes to the dams like to Three Gorges in China to the Maheshwar and Tehri Dams in India^[1] is not unknown to us and I will try not to write about it. Neither will I attempt to damn the ECA’s promises. However I will attempt to share my view on the damaging effects the ECA will leave on the buyer country; both due the bruise from the dagger, economics; and the insult, environment and social unrest.

While it is common notion that the ECA funds/enables funds, for infrastructure projects that are often shunned by their nobler counterparts, like the World Bank, on grounds of Environmental/Societal Risk; I doubt if their intentions are always adequately scrutinized for doing so.

It can almost always be argued that the reason behind ECA backing such projects, is that the money flowing in through the ECA, which is often the taxpayer’s money of the lending country, can in effect, through promotion of the interests of the lending country’s firms, flow back to its taxpayers. However why, should taxpayer, or for that matter, the government of the lending country support/create the ECA in the first place? Is it not a lot safer for them to invest/insure with the taxpayer’s money, less risky avenues within their country?

The argument against this, that the firms of the lending country, can in effect, benefit from the success of international projects, mainly in terms of gaining reputation as is the case with infra structure projects; does not completely convince me. Simply because the contracting firms/developers, of the lending country, involved are involving themselves in riskier projects. Riskier not only from the perspective that the projects feasibility/outcome/acceptance might not be adequately investigated, thanks to the confident backing of the taxpayers bucks, but also from the view point that the firms involved are alien to the host country and may be inadequately prepared to deal with the political and social challenges that may can arise during and after the execution stage of the project. This increased risk poses question; won’t the firm’s reputation, that which it seeks to better, be tarnished if the project evades success?

Now, for a change let’s look into the ECA backed infrastructure projects in the developing world where the lending country’s contracting firms/ developers are not involved in the development. An example of such kind, discussed in class is the roadway development in India. It was reasoned that the motive for doing so is obvious; and that it is for the promotion of the auto industry of the host country which will dominate the usage of the “to be developed” roadway. However when you come to think of it, is that not a rather too risky a way to promote the sales of the auto industry, for that matter any industry in the lending country? Is it done because the lending country fears that ushering direct benefits to the auto industry would harm its international trading relations, the saga of WTO regulations? I would not bet on it.

I have a reason of my own for the ECA to back risky projects in the developing world. Every penny of/ insured by, the ECA, which is in turn backed by the taxpayers money of an entire country, that is invested, is bound to, in turn attract more money in the form of private investments^[2] into the project. Why, simply because a federally funded project almost always appear rosier. And what if this is so? Ah ha! The trap is revealed. By funding a project with questionable probability of success the ECAs are indirectly risking the investment of private players. Now if the project indeed does not succeed, then what happens to the private investment? What happens to the “reputation” of the investment environment of the country? Won’t the authorities of the buying country not find it more difficult to raise capital for future development projects, which may be safe and feasible, on the grounds of tarnished “reputation”? Or in other words, will this not eventually increase the dependency of the country to seek support from ECAs which fund liberally?

Damming the ECAs, the economic dagger, is nothing short of nuclear disarmament or so I believe.

Stop enslavement! Stop ECA! For Freedom and Peace!

Reference

1. The Use of Environmental and Social Criteria in Export Credit Agencies’ Practices, A Study of Export Credit Agencies’ Environmental Guidelines with Reference to the World Commission on Dams By Markus Knigge, Benjamin Görlach, Ana-Mari Hamada, Caroline Nuffort, R. Andreas Kraemer

2. http://www.thirdworldtraveler.com/IMF_WB/Export_Credit_Agencies.html

3. http://www.escr-net.org/resources/resources_show.htm?doc_id=427881

4. http://www.eca-watch.org/problems/asia_pacific/india/index.html

5. http://en.wikipedia.org/wiki/Automotive_industry

Are we running away from Water?

2010-11-28T04:26:00.000-08:00

The question raised in the BBC world debate in Singapore, “Are we running out of water?” is quite significant but the answer was a clear “No”. However a related question, I feel, the concerned authority for water and sanitation in the developing world should ponder, is whether enough effort is being directed to tackle the issue of controlling water supply and demand. Stop beating around the bush and get to the point?

Well, there are two issues. The first being the right to water and the associated plethora of similar social and economic issues associated with recycling and supply; and the other, of drawing the fine line between right and luxury. Do not get me wrong here, but as it stands today the definition of basic requirement of 133 lpcd^[1] is quite a luxury and the offence, of failing to supply even a drop to certain section of population, is heinous.

Let me ask you something; how much water do you drink a day? Well say at most 10 liters^[2]; and these 10 liters if you demand that you be provided with the best of quality and that too consistently and you prefer the “old” and not the “Newwater”^[1] then are you asking for too much? If you assert that it is indeed the obligation of the state to meet your demands; I would agree that you are not wrong.

So a shift in the focus, as rightly brought out in the debate, is indeed essential; but I would argue for something a bit different. The two requirements of water for sanitation and drinking water supply and distribution may best be handled by a corporatized and regionalized national public sector organization with two “parallel” distribution infrastructures.

The primary mission of the organization should be in the lines of providing the bare minimum and only the bare minimum requirement, say 20 lpcd^[2]of water of the best possible quality to “all the people” all through the day. The quantity of consumption to be strictly metered; and pricing through a slab system which, within the limits, suitably subsidizes the lower consumers and above limits economically prohibits the larger consumers, which usually are VIPs, hotels^[3], from further use. (Of course it can be argued that this will, to an extent, deter economic development.)

The above strategy promises four benefits; one it will moderate consumption and may achieve the impossible but much needed^[3] “equalization of consumption”. Two, it will make recycling and other conservation technologies, previously economically infeasible, feasible. This is bound to promote sustainable utilization. The third benefit would be in the lines of increasing the quality as the quantity demanded reduces. The fourth and the final is to improve seasonal availability on account of better regional sharing as the quantity is lower; plus a national body is in charge.

But yes, this leaves us with a lot of problems as well, in the lines of installation, starting with the additional cost involved in a parallel system. Note here that a majority of the cost of “digging and putting the pipes”^[1] ,which is visible as the prohibitive factor, is in the “digging” and this means that parallel systems may prove feasible for new city/rural supply developments, though implementation for existing localities may prove economically prohibitive. Another issue would be as to how to meet the “additional” demand. This is where the second “money making” role of the government organization comes in; it will provide water treated to less stringent standards to private players at a suitable margin, and perhaps to larger consumers (hotels etc), who will in turn treat it to the standards demanded by the consumers and in turn sell them profitably.

Reference

[1] BBC World Debate, Water

[2] Minimum water quantity needed for domestic uses, WHO Regional Office for South-East Asia

[3] 30 litres for some, 1,600 for others: Inequities in Delhi's water supply, By Arun Kumar Singh; infochange

[4] Department of Drinking Water and Sanitation, Ministry of Rural Development Govt. of India, http://ddws.nic.in/ [5] http://en.wikipedia.org/wiki/Water_supply_and_sanitation_in_India

USOF, the Need and the Way Ahead

2010-11-28T04:23:00.000-08:00

The concept of the Universal Service Obligation (USO) was introduced in the discussion that centered on the telecommunication infrastructure in India, where in the need for the Universal Service Obligation Fund (USOF) as a means to finance the implementation of universal service in rural sector through the efforts of, mainly, BSNL was highlighted. My question is; is this the only way?

It is beyond doubt that among the five categories of infrastructure, the telecommunication sector has a place of its own; for it is perhaps the one sector that has the maximum positive network externalities. That is to say, the more users of the network the more beneficial the network becomes to all; quite simple right?, If Mr A alone has a phone in the world what is the point; but if Mrs A has a phone?

Let’s leave the idea dwindling in the back of our head and look in another direction, investment and return. Well like any other sector, investment in telecoms results in the obvious increase in demand for raw material, in this case equipment, cables, labor and the like, and the associated increase in economic activity. But what about the increase in efficiency and productivity of telecom users? Well arguably, the same holds true for other sectors, but it is beyond doubt that the extent is different in this case.

Also the idea of the existence of a “critical mass” ^[1] or level of service beyond which the benefits from investment in this sector become much higher than the linear profiles offered from investments in other sectors is quite intriguing.

Well, what is the point?

I argue that the idea of providing USOF as an incentive to allow telecom service providers, in this case BSNL, to service in the areas that have no coverage, is quite unessential; at least in the long run. One, because of the knowledge of the existence of the critical mass, almost all service providers look at rural India and similar land elsewhere as a potential market for expansion. The argument that BSNL has to enter such markets and prove the potential to invite competitors is quite an anti-competitive strategy; especially give the fact that the same is proved using USOF which comes from the license fee of all players (including the BSNL’s competitors)

Second, the role of the alleged benefiters of the network externalities and telecom driven developers, including the likes of handset manufacturers and BPO industry, is totally neglected from the equation. Then,

Why, in the name of USO, USOF giving off free crackers to these industries?

Why, in the name of USO, USOF promoting inefficient monopolistic development routes?

Reference

[1] Telecommunications Infrastructurea nd Economic Development: A Simultaneous Approach By LARS-HENDRIK ROLLER AND LEONARD WAVERMAN

[2] TRAI, Annual Report 2008-2009

[3] The Universal Service Obligation Fund (USOF) In India – An Overview

[4] http://www.indicus.net/media/index.php/2008/1245-indias-universal-service-obligation-for-rural-telecommunications

[5] http://findarticles.com/p/articles/mi_m0TLC/is_11_35/ai_80864265/

The search for the Spark, to be the light?

2010-08-05T04:38:00.000-07:00

Do you remember how you fell to sleep the last time ? When you fell to sleep ? What went through your mind at the moment you fell asleep ? Do you remember exactly how your dream began ? . My life so far has been nothing but a search for the answers to a lot questions. Questions like these that I can never answer. Can some one else answer these for me ? I threw questions like these, the question about my own life to everyone. A desperate search for a way to be know asking here there and living half the time asking how I can be the different, how I can be anything but a mediocre.

The realization came to me, though it took its time, that if I ever wanted to be anything but a mediocre then I ought to stop trying to be different. I have to realize that there isn't any treasure that is hidden in me, that when found will pull me up to the sky that I dreamt of touching. A confession to make, this realization that I talked about has not yet happened fully. Though this was put to me by a whole lot of people this has not sunk in.

There is a story I vaguely remember, of a father, old and frail, having too many sons who are of no use at all to the world. He one day asked these sons to plough the family's paddy field. But to no surprise they refused. One day the clever man, disclosed to the sons the secret of the hidden treasure buried deep at the far corner of the field. And Walla ! the plough and the trough where was where showered with sand and clay. A nice ending to the story; the father sowed seeds in this field and made a fortune and left them for his son. And they too learned the value of their hard work and effort. Realizing that the real treasure comes of hard work and effort and not from a pot that you inherit.

What am I to learn from this; that the essential search for the hidden treasure is inevitable? And that without it there will be no real treasure ? Perhaps yes . I still do not know, because the regret that the farmer's sons, we talked about in the story, would have been great. What about the joy that the fruit of their hard work brings ? Is it large enough? Had there been a hidden treasure would it not have made them more happy ? So should I for that matter give up my search for the hidden spark ? Would that mean I will loose the treasure if ever it was hidden?

By simple logic one gets this straight. Even if the treasure is not real and hidden the search for it finally rewards you, may be something that is not as good as what was dreamt of, but something that is definitely good enough. And the more that I search for this the more I make of the real treasure, and will this make me far from mediocrity? Is this search all that is to life ?

You come across another category of people who achieves a lot in life. What about them? Does this logic apply there ? Are they, the geniuses and the millionaires, mile away from what they are dreaming of? Are the achievers casting a mere shadowed of themselves to the world ? Or do these people hit upon some treasure? Are the feats they achieve a mere reflection of their hard work ?

It is compelling to believe that it is not the case and literatures do speak of the difference in abilities and of luck. Another question that just popped up; when should one or should one ever give up this hunt for the hidden treasure ? Does giving up this hunt amount to the end of achievements ? Is achievements all that matters in life? When should one eat the kill from the hunt? What about 'living' the life ?

Finally does it boil down to the question, is hard work or skill and brilliance and wealth that matters ? That decides? What if your dream is too big and the time too less for hard work to show its charm ? Should one give up on hard work and sit hand in hand and enjoy life with what ever you have, leaving the dream behind or spend all that you have to plough the field, knowing you have no seeds to sow ?

The role of faith; that God will show you the way has always been true.

If the there is difference in abilities, if I am good, or bad; but then why should I be? Is it for a purpose ? How do one know, what one does is for a purpose ? Is at least aimed at purpose ?What if there is no purpose ? What if the search for the purpose is the only purpose ? What if all that I do is not aimed at the purpose ? Will my life find a new purpose for itself? Can I ever know if I will ever hit the purpose ?Should I seek to find an answer to this ? Can I ever know if I can hit the purpose ? Should I seek to find an answer to this?

What if I cannot ? What if all that I have , I expend on the search ? What if I have and do not know that I have and keep away from trying to hit the purpose ?Do I fear loss. Do I wish gain ? Am I human or insane ?

May be we can still cash the check..

2010-08-05T04:35:00.000-07:00

Courtesy: Data for the Graph "Infrastructure Development in India and China—A Comparative Analysis" M. Julie Kim and Rita Nangia August 2008.

If we are to look at Indian and Chinese decisions on infrastructure development from the point of view of "to where/which sector" the money was put in, as against "how"; a strikingly different part of the game reveals itself, or so I believe. For instance take a look at the much higher growth in the Telephone sector in China as against that in India during the period of 1980-90 and 1990-2005. Did you notice some other parameter that shows a similar trend? Yes , Annual GDP Growth? We are again back at the question as to 'does greater GDP growth leads to more telephone lines or vice-versa?'

Lets deviate a little, look at Sardar Patel Road congestion issue that has come up; the proposal is a 145 cr (114 cr for land acquisition) grade separator. Imagine decongestion is feasible, at least for a few years, through the implementation of, say, congestion pricing, or for that matter any other Intelligent Transportation System (ITS) for a reasonable investment of 20 cr. Looks like a saving of 125 cr isn't it? ; can't this be suitably used elsewhere, perhaps as research funding for stimulating the needed technological development which in turn will catalyze rapid economic development.

So compare now, for the sake, telephone and ITS; and you will see that they are/rely on the telecommunication backbone of the country. So essentially telecommunication, though indirectly, hypothetically helped us to postpone the congestion in Sardar Patel Road and help us find new technologies.

So could this logic explain why China overtook India in the economic race? So can we apply the same and cash in?, entering the virtuous circle, apply technology(which is by all means a part of infrastructure)>fund research>develop the economy>more research>better infrastructure>all kinds of development...

Before we set the ball rolling, lets reflect for a moment; are we at the right time and going in the right direction? 50% of our population is below 25 years of age where as 80% of Chinese population is above 15; We are at a better position of 79 in Failed States Index where as China stands at 62. Will our policy of promoting equality right from the start turn the tides in our favor? Or will, like China, accepting initial income inequality as an inevitable effect of economic development be the only way out? Will China's 10 point growth sustain? If so for how long?

Are we to shoot for the stars, with the hope that even if we miss we will land in the moon?

Reference:

"India’s Economic Growth and Market Potential: Benchmarked Against China" G.K. Kalyanaram GK Associates
"Is China's Economic Growth Sustainable?" Ali Wyne
"Infrastructure Development in India and China—A Comparative Analysis" M. Julie Kim and Rita Nangia
http://en.wikipedia.org/wiki/Demographics_of_the_People%27s_Republic_of_China
http://en.wikipedia.org/wiki/Demographics_of_India
http://www.hindu.com/2010/08/04/stories/2010080458790100.htm
http://en.wikipedia.org/wiki/List_of_countries_by_Failed_States_Index