ECONOMY

Monthly Archives: FEBRUARY 2017


New Institutional and Financial Arrangements required to bring the Farmers out of the present morass
Opaque System, Obscure Farmers
28.02.17 - suresh kumar*
Opaque System, Obscure Farmers



DESPITE their substantial contribution to the national GDP, India’s farmers, even in agriculturally advanced states, are hostage to government policies and programmes, as well to the machinations of informal players, moneylenders, aarhtias and even dealers selling fertilizers and agro-chemicals. Undoubtedly, the government is spending a lot on subsidies on irrigation, fertilizers, seeds, interest subvention and energy for the farmers, but these are neither transparent not fairly targeted. Rather, these are inequitable and skewed. Unfortunately, the premier of a state and the pauperised marginal farmer get the subsidy at the same rate. The vicious impact is further aggravated by the supply of poor quality seeds, spurious agro-chemicals and fertilizers. The market imperfections, too,add to the farmers’ misfortune, thus completing a doomed scenario.

The plight of ‘cultivating farmers’ is much worse as the system does not recognize farmers who cultivate land taken on lease. All subsidy programmes provide for the landowners. The lease or mortgage of land for cultivation is not registered. The market of faith through oral leases or patta system works well even in the absence of any adequate regulatory mechanism, so long as there is no dispute or a calamity. Else they suffer irretrievable losses.

The vagaries of weather add to the smorgasbord of volatile factors that farmers are doomed to deal with. The experience shows that in a cycle of three years, the farmers suffer either a drought or a deluge. The country has not been able to find a durable solution to this, despite evolution of fairly advanced technologies. The existing calamity relief at a rate of Rs.13,500 per hectare is grossly inadequate. Such a relief does not offset even the input costs. Besides, the affected farmers need some money for their living. Since borrowings from informal sources remain the only hope, the debt mounts, becoming a persistent problem.
The government has tried various forms of crop insurance, including weather and income based crop insurance schemes, but most of these have turned out to be a failure. Even the latest PMFBY is not expected to go too far. None of these schemes are farmer or plot based. These do not address the multifarious perils faced by the farmers. Even the sum insured is not sufficient to cover the full risk that the farmers have to contend with. Ironically, these schemes expect most farmers in a village, or the village as whole, to suffer from a calamity, which happens very rarely. So the loss to some is the loss to none – clearly an error in thinking.

It is of course true that all across the world, the agriculture is subsidized and dependent on weather. However, elsewhere, the farmers do not suffer knowledge and infrastructure deficit. They are facilitated by the system for better living with some, if not full, occupational freedom. In our country, the financial and institutional arrangements need to be re-worked towards this end.

Universal Basic Income (UBI) for farmers can be a good innovation and the crop insurance should be made plot/farm based. Land leasing should be regulated through an appropriate legislation, protecting the rights of owners and cultivators in an equal measure. The cultivators should not be denied benefits for their investment and efforts on farm. They should not, however, be able to retain the land for a day more than what is mandated under the lease agreement. ‘Kurki’ or sale of land in favour of a leaseholder should be barred. 

The subsidy on fertilizers seems unavoidable because the country is still not self-sufficient and is dependent on imports. Thus, intermediate support is required to provide timely supplies of the required fertilizers at affordable prices. The farmers do not have resources and information to negotiate and access the quality materials. They cannot even deal with the importers or the dealers. However, a better system than what we have today is required to check the pilferage. 

The remaining subsidies comprising free power, water, cheaper seeds, interest subvention and cheaper implements etc. may be reformulated and the money used to fund a Universal Basic Income (UBI) scheme for the farmers. The present system is causing severe damage to the natural resources. Each farmer may be paid a basic amount as income every month for his day-to-day spending and he should defray his own expenses even for purchase of inputs. Surely, the amount of basic income will vary for different cropping zones as also for different geographical regions. Uniformity in income may be a political necessity, but it is not justified. The basic income should be commensurate with the minimum level of livelihood that we aspire for our citizens. It should also be linked to the present levels of family income – those with higher family incomes should be paid less, or nothing. The UBI should certainly include some amount for input costs so that production efforts yield enough for the recipients, minimizing their dependence on intermediaries. The idea was discussed in the Economic Survey 2017, but did not catch the imagination of those who formulated the Union Budget.

Crop insurance should be restructured and made farm based. It is not a cogent argument that in such a situation, the farmers will not devote themselves fully to the growth and protection of their crops. It is also not logical to say today that the calamitous loss cannot be assessed at individual farms. While better technologies are available, though with some extra investments, the age-old annewari (girdawari) system is also trustworthy. With appropriate techno-legal safeguards, and an affordable premium, the farm-based insurance can help in alleviating the farmers’ miseries in the long run. It may also save substantial valuable resources. 
The marketing reforms have not been discernible. There has, in fact, been no major new initiative after the introduction of MSP during the green revolution era. Even in states like MP and Chhattisgarh, the same old formulations are being re-fixed. While the MSP is essential for assured marketing of food grains and pulses, for other crops, free play of market should be encouraged. MSP for other crops should be prescribed to determine deficiency in prices, which the farmers realize in the market. The deficiency price support should be given directly to the farmers who realize a price less than the MSP. The apprehensions of misuse can perhaps be catered through amendments in the existing APMC Acts, for effective regulation of sale/purchase transactions and promotion of public-private partnership in agri-marketing. The amended laws should also encourage e-marketing.

The agriculture reforms should thus focus on knowledge economy and systemic alterations with new institutional and financial arrangements to manage and supervise the production and related risks, reformulating the subsidies, payable directly to the deserving farmers as basic income.
 
Pic courtesy: nationalgeographic.com
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*Suresh Kumar is a retired IAS officer who served as Additional Chief Secretary (Development) in the Punjab Govt. He can be reached at sureshkumarnangia@gmail.com 




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Jio effect: Airtel Removes Roaming Charges On Calls, Data
27.02.17 - TEAM PT
Jio effect: Airtel Removes Roaming Charges On Calls, Data



Bharti Airtel Ltd on Monday said that it has removed additional charges on voice, SMS and data usage on national roaming, in an effort to retain users in the wake of the new entrant Reliance Jio’s free voice and data services.
 
"Airtel customers roaming within India will enjoy free incoming calls/SMS and there will be no premium on outgoing calls allowing them to speak freely wherever they are within the country,” Bharti Airtel said in a statement. "Also, there will be no additional data charges on national roaming. Home data packs for customers will apply even while they roam across India,” the statement added.
 
India's largest mobile phone service provider also said international call rates will be cut by up to 90 per cent to as low as Rs. 3 per minute and data charges by up to 99 per cent to Rs. 3 per MB across popular roaming destinations.
 
"This marks the death of national roaming and the whole country will now be like a local network for our customers, who will not have to think twice before making or receiving calls or using data while traveling outside their home base. Airtel has again set the benchmark in delivering best in class value backed by a great network experience," said Gopal Vittal, MD & CEO, Bharti Airtel.
 
The company also said beginning 1 April, customers on international roaming Without a pack will be fully protected from bill shocks through an automatic adjustment that is equal to the daily pack for that particular country.
 
As examples, Airtel explained: "When a customer traveling to the USA without a pack hits the threshold of Rs 649 (the price of the one day pack for USA), he/she will automatically move to the one day pack with free incoming calls/SMS, 100 India and local country outgoing minutes, 300 MB data and a host of other benefits. Similarly, a customer traveling to Singapore will move to the one day pack the moment his/her usage hits the Rs 499 mark.”

Bharti Airtel offers international roaming packs with varying validity options, such as 1 day, 10 days, 30 days, etc. with free incoming calls/SMS, local and India calling minutes and texts, and data. The new facility would be specially useful for the users who fail to subscribe to a respective roaming pack, and make their travel with active international roaming charges, Bharti Airtel said.
 
Bharti Airtel Chairman Sunil Mittal said: "At Airtel, we are changing the international roaming paradigm, which will allow our customers to take their number to every corner of the world. As an industry, operators across the world must collaborate to remove the cost barrier to roaming and offer customers the convenience of staying connected without the fear of exorbitant bill charges." 

Reliance Jio's entry has already triggered a wave of consolidation in the country's telecom space. Recently, Bharti Airtel said it will acquire Norway-based Telenor's Indian operations across all seven circles to boost its subscriber base and augment its spectrum holding.

Besides, this Vodafone India and third largest operator Idea Cellular, too, are in exploratory talks to merge their businesses to take on the threat emerging from Reliance Jio's entry.




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WhatsApp’s new Snapchat like 'Status' feature goes Live for everyone, Here's how to use it
24.02.17 - TEAM PT
WhatsApp’s new Snapchat like 'Status' feature goes Live for everyone, Here's how to use it



WhatsApp Status, the new feature which lets users upload photos and videos for their contacts to see, instead of a simple text-based status message, has now gone live. The feature is live on Android, iOS and Windows smartphones across the world. WhatsApp’s new Status, which is totally inspired from Snapchat’s Stories, was announced earlier this week by the company.
 
With the new WhatsApp Status feature, users will be allowed to share photos and videos with friends and contacts on the app. WhatsApp confirms that similar to chats, the status updates are also end-to-end encrypted. The Status messages you put will disappear after 24 hours.

"We are excited to announce that, coinciding with WhatsApp's 8th birthday on February 24, we are reinventing the status feature," wrote Jan Koum, CEO and Co-founder of WhatsApp in an announcement blog post earlier this week.
 
"Starting today, iPhone, Android and Windows users can send photos, videos and GIFs through Status to share special moments throughout their day with friends and family," said the company.
 
Status works exactly like Stories on Snapchat or Instagram. Now on iOS, Status has its own tab on the extreme left at the bottom, followed by Calls, then Camera in the middle, followed by Chats and then Settings. On Android, the tabs are ordered like this: Camera, Chats, Status and then Calls.
 
Here is how you use it:
- Tap on the Status tab.

- Here you will see all the status you contacts have posted.

- Tap on a status to reply to that person. The replies are sent to regular chats along with the snapshot of that person's Status. In this way WhatsApp hopes that Status updates will be a trigger for conversations.

- To post your own Status update, you have to click on the dotted circle with plus sign (it's on the top right corner of the screen). Or you can just tap on "My Status".

- Your Status message will automatically expire after 24 hours. Additionally, if you want to delete your Status message, you will have to tap on the 3 dots in front of your Status. In the next Window, long press the Status and select delete option.
 
WhatsApp lets you control who can see your Status update as well. In WhatsApp’s Status tab on iOS, there’s a privacy option right on top. You have three options: "my contacts,” "contacts except…” and "only share with…” for your story. On Android, the Status Privacy option is in the settings. Just tap the three dots on top of WhatsApp homepage, and you’ll see Status Privacy option on top.  Once again, you can choose from the three options.
 
 
You can also reply to someone’s Status update. There is a reply button, so you can comment on any photo, video, or GIF. Once you tap reply, your message will be sent in a WhatsApp chat with a thumbnail of the Status update. It’s not clear if that message will also be deleted after 24 hours.

Below your own Status, you’ll see little round heads of your contacts with a blue circle around them. This blue circle indicates they too have a ‘Status’ you can check out. You can keep tapping on these status updates to move from one contact to another.
 
The new WhatsApp Status no doubt take cues from Snapchat's Stories, and is being seen as the company's first attempt to move away from the traditional messaging app that is being followed. The revamped Status also looks inspired by Facebook's change of profile and cover pictures that notifies other users.




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A primer on Reliance Jio Prime membership programme
21.02.17 - team pt
A primer on Reliance Jio Prime membership programme



Reliance Jio Chairman Mukesh Ambani announced the Jio Prime programme today. The package is basically an extension of Jio’s 4G services, including its content services, which can be availed by existing Jio customers. For users to enroll in the Jio Prime programme, they’ll have to pay Rs 99 as the membership fee and an additional Rs 303 per month to enjoy Jio 4G services for another year.
 
Ambani unveiled the Jio Prime programme as a gesture of gratitude towards its initial 100 million members. "Our 100 million initial customers are Jio’s foundation. Today is the day for me to show my gratitude to you, the initial 100 million customers and ensure you always continue to get extreme value with Jio,” said Ambani.
 
Also, users who aren’t on Jio can be a part of its Prime programme by becoming a part of the Jio network latest by March 31. Customers can enroll for Jio Prime programme on MyJio app, Jio.com or via Jio offline stores. Here’s everything you need to know about Reliance Jio’s Prime programme:
 
What is Jio Prime programme?
 
Jio Prime programme will give its existing customers an access to Jio’s 4G data services as well as bouquet of company’s content services at Rs 303 per month. There’s an enrollment charge of Rs 99 as well. Basically, all services that users were enjoying under Jio’s Happy New Year offer will be covered under the Jio Prime programme.
 
What are the charges?
 
Jio users can enroll for Rs 99 and additionally pay Rs 303 per month till March 31, 2018 to avail Jio’s free 4G services.
 
How to enroll?
 
Jio customers can enroll for the Jio Prime programme via MyJio app or on Jio.com as well as from Jio offline stores.
 
When is the deadline?
 
Enrollment for the Jio Prime programme starts March 1 and ends March 31. Customers who aren’t on Jio network will have to become a part of it latest by March 31 to enroll for the Jio Prime programme.
 
What all is covered under Jio Prime programme?
 
Everything covered under Jio’s Happy New Year plan will be also be a part of company’s Prime membership programme. This means there will be a 1GB FUP limit as well as free data, voice calling, national roaming and more. Reliance Jio plans come bundled with free access to Jio apps, including MyJio, JioChat, JioMoney, JioMusic etc. Content on these apps can only be accessed via the Jio network. 
 
(Courtesy : Indian Express)
 





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HDFC Bank's Aditya Puri says Paytm has doubtful business model, no future
17.02.17 - team pt
HDFC Bank's Aditya Puri says Paytm has doubtful business model, no future



Hiiting out at digital wallets, Aditya Puri, MD, HDFC Bank on Friday said that he sees no future in digital wallets! He further said that Paytm cannot be Alibaba as the government doesn’t allow replication of model. In a conversation with ET Now Puri told the business news channel, "Current loss of Paytm is at Rs 1600 crore. It’s current economic model is doubtful.” 
 
With Paytm adding five lakh customers and doing 60 lakh transactions per day, it was the biggest beneficiary of PM Narendra Modi’s demonetisation drive. Founder and CEO, Paytm,
Vijay Shekhar Sharma told ET Now that only 20% transactions were offline before demonetisation. "Offline payments are becoming bigger than online payments for us,” he said. We want to become the digital transactions leader, he added.
 
Paytm also expects to lose 20-30% of its offline category customers after March 13, when the Reserve Bank of India takes the limits off from cash withdrawals, founder Vijay Shekhar Sharma said on Wednesday in an interview to CNBC TV18. "If we retain 70% of what we have built, we still have a larger (offline) than online category, and that’s where the business is for us,” Vijay Shekhar Sharma said.




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