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THE
DNA: Protecting tribals
The decades-old scam in Maharashtra
over fake tribal certificates, highlighted by dna, is a matter of deep concern
for various reasons. Firstly, it has been continuing for a very long time,
which points to the obvious political and administrative patronage that helped
it to thrive.
The system of checks and balances existing in the system — the
Supreme Court had laid down clear guidelines and the state formed a committee
with judicial power 10 years ago to stop this malpractice — have been least
effective because of the lack of will to plug the loopholes and crack down on
the perpetrators. Second, it does immense disservice to the cause of
affirmative action, which has been in the line of fire from critics demanding
that caste-based solutions be replaced with the criterion of financial status
of the beneficiaries for the policy to be more inclusive and just. Thirdly, it
points to the exclusion of tribals from government services in particular and
the mainstream in general, for whom this quota was originally meant. Had they
been educated and well-informed about such welfare measures, they would have
come forward and claimed what’s rightfully theirs.
The fake certificate scam is so endemic that the Maharashtra
government will take years to ferret out the culprits. By one account, the scam
goes as far back as 1965. Imagine the extent of the rot when it is estimated
that over 10 lakh fake tribals in the state have enjoyed various benefits, from
getting admission to higher educational institutes like IIT and medical
colleges to getting jobs in state and central institutions on the basis of Schedule
Tribe (ST) quota. All this while, it has been considered an open secret by
successive governments because of electoral compulsions. Political parties had
treated this gross manipulation as the means for their supporters to secure
employment. Such an act, which amounts to forgery and cheating and falls under
Sections 420 and 468 of the Indian Penal Code, carrying a seven-year jail term,
wasn’t deemed fit for punitive actions. Even the occasional blowing of the lid
— for instance when Air India had spotted several dubious candidates — had gone
unnoticed or was swept under the carpet to avoid public outrage.
The latest incident, involving 25 out of 43 candidates who
had cleared the Maharashtra Public Service Commission (MPSC) exam on the
strength of fake certificates, appears to have jolted the state government out
of its stupor. It has approached the Aurangabad branch of the high court to
cancel their selection. It has been alleged, and the allegation merits
attention, that thousands of bogus candidates over many years have found it
easy to exploit the recruitment procedures of UPSC and MPSC as rarely do these
authorities bother to verify the authenticity of caste certificates, given the
‘sensitive’ nature of the cases. Today, if the state government truly intends
to dig deep, it will need tremendous resources to get to the bottom of a
systemic corruption. That is least likely to happen also because leaders across
the political establishment will be found hand-in-glove with the perpetrators.
The fake caste certificate racket is probably a nation-wide
phenomenon — a large-scale organised cheating to deny the oppressed classes
their due. One of the most effective ways to deal with it will call for the
various wings of central and state governments dealing with tribal welfare to
be more vigilant because laws have proven to be ineffective and random checks
at public institutions haven’t had a deterrent effect on scamsters.
pa·tron·age
The support
given by a patron
thrive
(of a child,
animal, or plant) grow or develop well or vigorously.
loop·hole
An ambiguity or
inadequacy in the law or a set of rules.
perpetrators
(perpetrate)
perform an act, usually with a negative connotation; "perpetrate a
crime"; "pull a bank robbery"
im·mense
Extremely large
or great, especially in scale or degree.
dis·serv·ice
A harmful
action.
en·dem·ic
(of a disease
or condition) regularly found among particular people or in a certain area.
ferret ouT
to find out a piece of information or find someone or something, after looking in many places or asking many questions:
cul·prit
A person who is
responsible for a crime or other misdeed.
com·pul·sion
The action or
state of forcing or being forced to do something; constraint.
for·ger·y
The action of
forging or producing a copy of a document, signature, banknote, or work of art.
pu·ni·tive
Inflicting or
intended as punishment.
out·rage
An extremely
strong reaction of anger, shock, or indignation.
jolt
Push or shake
(someone or something) abruptly and roughly.
stu·por
A state of
near-unconsciousness or insensibility.
vig·i·lant
Keeping careful
watch for possible danger or difficulties.
de·ter·rent
A thing that
discourages or is intended to discourage someone from doing something.
THE
HINDU: Action plan to fix public sector banks
The
bloated levels of stressed assets in India’s state-owned banks have been a big
cause for concern for quite some time now. With the Reserve Bank of India
keeping up the pressure on them to identify, recognise and make provision for
bad loans, a better picture can be had of the magnitude of the stress in thebanking
system. The RBI is convinced that banks should clean up their books so that
legacy issues are dealt with once and for all to enable them to move forward
with a clean slate. This has, predictably, caused a scare across different
layers of the economy. Given this somewhat grim background, there were
legitimate expectations that the Centre, being a majority owner of public
sector banks, would step in to provide increased fund assistance. In the end,
Finance Minister Arun Jaitley has stuck to what he had promised earlier, and
committed in his Budget speech capital infusion into these banks of just Rs.25,000
crore for the coming year. Mr. Jaitley’s offer is inadequate given the
magnitude of the fund needs of these banks. Asserting that “we are solidly
behind these banks’’, he did indicate that the government would find fresh
funds should a requirement arise. Capital need is just a subset, or
consequence, of the larger malaise of inefficiency that has been hurting these
public sector banks for a long while now. Indeed, as Mr. Jaitley suggested in
the Budget speech, the strength
of the financial sector is dependent on a strong and well-functioning banking
system. Viewed in this context, the decision to set up a Banks Board Bureau,
headed by former Comptroller and Auditor General Vinod Rai, is a significant
move forward. The board could yet be an effective mechanism to end political
interference in business procedures and decision-making in banks. An empowered
independent bureau such as this could help reset the concept of an arm’s-length
relationship in public sector banking. Once ownership is delinked from
management, fixing accountability becomes that much easier. This can foster a
decision-making framework that privileges business sense. It is, however,
important to ensure that systems are in place to make the autonomous
functioning of this bureau sustainable.
Mr.
Jaitley has done well to take a holistic approach to the bad loans problem. Letting the sponsor of
an asset reconstruction company to hold up to 100 per cent stake in it should
spur foreign entities to look at the Indian “bad asset” market as an
opportunity. A bankruptcy code is long overdue, and it would help banks pursue
recovery action purposefully. A tough regulator and a stingy government appear
to have combined forces tacitly to lay the groundwork for possible M&A
(mergers and acquisitions) activity in the Indian banking space. It is
commendable that there is a concerted effort to clean up the ecosystem to
ensure fair play in the banking field.
bloat·ed
(of part of the
body) swollen with fluid or gas.
grim
Forbidding or
uninviting.
priv·i·lege
A special
right, advantage, or immunity granted or available only to a particular person
or group of people.
tacitly
In a tacit
manner; by unexpressed agreement; "they are tacitly expected to work 10
hours a day"
THE HINDU: A flight shows up
the system
Vijay
Mallya’s quiet departure, a week before the Supreme Court heard a plea from a
consortium of lenders to his defunct Kingfisher Airlines seeking an order
restraining the businessman from leaving the country, glaringly exposes the
loopholes in the system that prevails in India. The court was informed by the
government that the liquor baron flew out on March 2, the same day the banks
had moved the Debt Recovery Tribunal to have Mr. Mallya arrested and his
passport frozen. The failure on the part of the tribunal and subsequently the
Karnataka High Court to act immediately to ensure that Mr. Mallya remained within
the country to face judicial proceedings prompted the lenders to petition the
Supreme Court. The Kingfisher
Airlines promoter faces cases for
the recovery of about Rs.9,000 crore the airline owes the banks — for which he
had stood personal guarantee. That a consortium of 13 banks, which includes the
country’s largest lender, the State Bank of India, and the might of the
government were unable to restrain a person declared a “wilful defaulter” from
evading due process and flying abroad right under the nose of the authorities,
reflects poorly on the justice and law enforcement systems. Timely judicial
orders protect the parties’ interests, but in this case even the DRT order
stopping a payment of $75 million
from Diageo to Mr. Mallya appears
to have come too late as the British company had already paid him a significant
part of the amount. Even a look-out notice issued to all airports had no
effect, according to the Central Bureau of Investigation.
Mr.
Mallya has sought to project the corporate loan default as a case of business
failure due to macroeconomic factors and adverse government policies. The
banks, however, say he is a wilful defaulter. The CBI also alleges corruption
in a Rs.900-crore loan sanctioned by top officials of IDBI Bank despite the airline’s poor credit
rating. And the Enforcement Directorate has registered a money-laundering case
against him in connection with the same transaction. Mr. Mallya has sought to
portray himself as a wronged man, singled out for multiple proceedings while
those who owe much bigger sums have not been designated as defaulters or
investigated. He has also claimed that banks had recovered Rs.1,244 crore
through the sale of pledged shares and that another sum of Rs.1,250 crore
deposited in the High Court is available for recovery. These charges and claims
can only be judicially settled, for which Mr. Mallya’s presence and
availability are vital. He would do well to return to the country if he wishes
to establish his innocence and bona fides. For the banks and their recovery
processes, it is a question of credibility, as they can ill-afford to give the
impression to the average borrower that a high-flying debtor can get away with
brazen default. For Mr. Mallya, the lesson from this episode is that flaunting
his wealth may give a man an appearance of flamboyance in good times, but it
ill-serves his reputation in circumstances of adversity, especially when he is
perceived to be flouting the law.
con·sor·ti·um
An association,
typically of several business companies.
re·strain
Prevent
(someone or something) from doing something; keep under control or within
limits.
loop·hole
An ambiguity or
inadequacy in the law or a set of rules.
bar·on
A member of the
lowest order of the British nobility. The term “Baron” is not used as a form of
address in Britain, barons usually being referred to as “Lord.”
bra·zen
Bold and
without shame.
flout
Openly
disregard (a rule, law or convention).
INDIAN EXPRESS: If not for him
On Wednesday, veteran
rock critic and journalist Peter Paphides tweeted perhaps the most poignant and
accurate tribute ever in 83 characters: “RIP George Martin. Your open,
inquiring, playful nature changed everything forever.” Without Sir George
Martin, who passed away at 90 on Tuesday, there may have been no “The Beatles”.
Without him, there would certainly have been no distinct Beatles’ sound. In
June 1962, after several labels had turned them down, Martin granted the band
an audience at Abbey Road and signed them onto Parlophone. Soon, he would have
drummer Pete Best replaced by Ringo Starr, and made the boys speed up the tempo
of “Please, Please Me”. Martin, by then, had arrived as maker, philosopher and
friend of John, Paul, George & Ringo.
As the Beatles’
record producer, the classically trained Martin’s ear and unflagging creativity
helped tune and enrich John Lennon and Paul McCartney’s lyrical output and
chisel out the rough edges from the sound they made together with George
Harrison — without compromising their raw genius. Reductively, George Martin
was the Apollonian order to the Beatles’ Dionysian chaos. Each exists in its
own right. But put them together, and you have artistic perfection, or close to
it. Martin, thus, had redefined not only popular music but also the producer’s
place in it.
An illustrative
example of Martin’s influence is Paul McCartney’s iconic “Yesterday”, which the
band wanted him to perform solo on guitar. Martin convinced McCartney to try it
with a string quartet. The rest is history. If anybody had first claim to the
title of the “Fifth Beatle”, Martin probably ranked above Brian Epstein, their
manager who died tragically in 1967. In retrospect, Lennon’s contention that
“The Beatles are the Beatles. Separately, they are separate… Nobody is the
Beatles. How could they be? We all had our roles to play” is a truism. But
then, the other Beatles didn’t agree when, post-split, Lennon underplayed
Martin’s role.
poign·ant
Evoking a keen
sense of sadness or regret
Ap·ol·lo·ni·an
Of or relating
to the god Apollo.
Di·o·ny·sian
Of or relating
to the god Dionysus.
ret·ro·spect
A survey or
review of a past course of events or period of time.
tru·ism
A statement
that is obviously true and says nothing new or interesting.
BUSINESS STANDARD: Opening up
exploration
The decisions taken on hydrocarbon exploration and pricing
by the Union Cabinet on Thursday are by and large welcome, in that they should
encourage greater private sector investment in this vital activity. India is
not well-served at the moment in terms of natural gas and petroleum resources;
it has to import a vast majority of its requirement, leaving the country at the
mercy of world prices and threatening the stability of its external account.
This problem has been exacerbated of late by contractual disputes between the
government and various licensees. Earlier contracts, based on production
sharing after cost recovery between the government and the private sector
contractor, have proved to be difficult to monitor and have led to disputes.
Among other issues in these contracts, operators had an incentive to "gold
plate" their costs, and thereby reduce the amount provided to the
government. This has now been replaced by a revenue-sharing model, which is
easier to administer. This is a welcome move.
It is possible that industry will be more pleased with other aspects of the policy. A new licensing system is now being introduced, which will mean that the concessionaire in a particular field will be able to explore for both conventional hydrocarbon resources like petroleum as well as unconventional ones like shale gas and shale oil. "Open acreage" is also promised, so that companies can bid to explore certain blocks and then the hydrocarbons regulator will subsequently examine their geological findings. This means that companies can start to look at blocks that have not already been put out for bidding by the government.
While there is much to welcome, it is important to remember that the cost recovery and production-sharing method had its advantages in minimising risk to the explorer. If investments are to fructify in the changed regime, it is necessary to ensure that other sources of risk are minimised - for example, companies should not be expected to specify profiles of their hydrocarbon discoveries in advance to their actual production, given geological uncertainties. But overall, several long-pending issues have been addressed.
Perhaps the most debatable of them is the grant of pricing freedom, subject to a cap, on deep-water and other hydrocarbon discoveries in difficult areas. This has been extended naturally to future discoveries - but also to reserves discovered under previous contracts which had not started producing at the beginning of this calendar year. Some will see this as a windfall gain to the concessionaires in question, including Reliance Industries Limited. However, the government has rightly included the caveat that the new regime will only be available if arbitration or other legal proceedings currently in progress are settled or withdrawn. It is notable that, on Thursday, Reliance's stock price did not trend upwards. The overall impact of the increase in gas price on downstream sectors will have to be watched. At present the gas price is $3.82 per million metric British thermal units (mmBtu); what the new formula might take it up to is not yet clear. But the effects of such decisions on medium-term investment and on prices, however, remain to be seen.
It is possible that industry will be more pleased with other aspects of the policy. A new licensing system is now being introduced, which will mean that the concessionaire in a particular field will be able to explore for both conventional hydrocarbon resources like petroleum as well as unconventional ones like shale gas and shale oil. "Open acreage" is also promised, so that companies can bid to explore certain blocks and then the hydrocarbons regulator will subsequently examine their geological findings. This means that companies can start to look at blocks that have not already been put out for bidding by the government.
While there is much to welcome, it is important to remember that the cost recovery and production-sharing method had its advantages in minimising risk to the explorer. If investments are to fructify in the changed regime, it is necessary to ensure that other sources of risk are minimised - for example, companies should not be expected to specify profiles of their hydrocarbon discoveries in advance to their actual production, given geological uncertainties. But overall, several long-pending issues have been addressed.
Perhaps the most debatable of them is the grant of pricing freedom, subject to a cap, on deep-water and other hydrocarbon discoveries in difficult areas. This has been extended naturally to future discoveries - but also to reserves discovered under previous contracts which had not started producing at the beginning of this calendar year. Some will see this as a windfall gain to the concessionaires in question, including Reliance Industries Limited. However, the government has rightly included the caveat that the new regime will only be available if arbitration or other legal proceedings currently in progress are settled or withdrawn. It is notable that, on Thursday, Reliance's stock price did not trend upwards. The overall impact of the increase in gas price on downstream sectors will have to be watched. At present the gas price is $3.82 per million metric British thermal units (mmBtu); what the new formula might take it up to is not yet clear. But the effects of such decisions on medium-term investment and on prices, however, remain to be seen.
ex·ac·er·bate
Make (a
problem, bad situation, or negative feeling) worse.
con·ces·sion·aire
The holder of a
concession or grant, especially for the use of land or commercial premises.
a·cre·age
An area of
land, typically when used for agricultural purposes, but not necessarily
measured in acres.
fruc·ti·fy
Make
(something) fruitful or productive.
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