Companies & Sectors
Coal mining needs combined efforts from Railways and Coal Ministry

Rail links are needed to evacuate coal from mines and hence the combined efforts of the Railway Ministry and Coal Ministry would be useful to the country

 

While addressing a large gathering of business leaders, attending the Airtel-The Economic Times Business Summit recently, the reformist Railway Minister, Suresh Prabhu stated that there is an urgent need for financing the various Railway projects to make it an engine of growth.  He said that there is an imperative need to expand the railway connectivity by another 30,000 to 40,000 kms of rail lines and to decongest the crowded routes.
 
He said that there is a need for funds for this purpose and this will have to be used efficiently used on realistic project costs.  He is reported to have further said that "if we don't make investment in railways there won't be any future revenue that will come into the Railways to improve the operating ratio".
 
He made specific reference to accessibility of Pension funds in prosperous countries like Australia and Canada. He said that investment in Railways could add 2.5% to 3% to the growth rate in the next few years.
 
In a separate development, Anil Swarup, Coal Secretary, mentioned at a seminar organised by the MCC Chamber of Commerce and Industry, in Kolkata, that the Coal Ministry has identified 50 Rail Projects to ensure evacuation of coal from mines. It appears that a meeting has been set up with the Railway Board Chairman to discuss the issue threadbare. Subsequently, the method of financing the operations will need to be explored.
 
The investment opportunities in the Indian Railways are mind boggling. From the current network of about 64,600 kms, plans are afoot to expand it by 25,000 kms in the next 6-7 years. Included in the plans are the six dedicated freight corridors (DFCs). These are to be constructed along the Golden Quadrilateral and its diagonals. Since 100% FDI (foreign direct investment) is allowed in the railway infrastructure, there is ample scope for capital intensive modernisation and capacity augmentation projects. 
 
It is essential that the Railways clarify and advise us on the actual status of the following rail link projects, which have been in "various stages of development" for sometime now:
(a) Tori-Shivpuri-Kathotia in North Karanpura, Jharkhand ... 91 Kms
(b) Bhudeopur-Korichchaapar to Mand Raigadh Mines in Chhattisgarh  .. 52 Kms
(c) Barpali-Jharasaguda in IB Valley, Odisha .. 180 Kms
 
These will improve coal linkages and will bring nearly 100 million tonnes incremental traffic to the Railways. If these three rail links alone are handled on a war footing, it is estimated that these 323 kms can unlock upto 300 million tonnes of coal!
 
It is hoped that the Finance Ministry will consider the issue of generating the required finances for such projects. Pension could be one source.  The other is the availability of funds with Coal India in its reserves. Also, capital could be raised from the public. There is a need for the establishment of separate rail-road companies to manage these dedicated corridors for coal movement.  Wagon makers could be allowed to participate on a joint venture basis with the Railways and form independent corporations for such increased traffic. There are so many innovative ways in which the required finance can be generated!
 
(AK Ramdas has worked with the Engineering Export Promotion Council of the ministry of commerce. He was also associated with various committees of the Council. His international career took him to places like Beirut, Kuwait and Dubai at a time when these were small trading outposts; and later to the US.)
 

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COMMENTS

Dr Anantha K Ramdas

2 years ago

Mr Vishal: thanks for your kind comments.

It is necessary to create the culture of employees acquiring a sense of belonging, no enterprise, however big or small can succeed.

Unions are important as the coordinator between the employees and the owners/management; however, by and large, unions are externally controlled by politicians who have axes to grind. Dedication by Union leaders is practically absent and they will change their stand if adequate "incentive" is offered, which is generally a bribe. Unless this is realized by the workers, they are the worst sufferers.

As for giants like Coal India, anyone who actually "works" in the mines need to be a stake holder. Today, most of them are contract employees of labour suppliers and this itself has to be eradicated if we wants to make progress in this industry. Our equipments in most collieries were probably ordered by our ancient rulers - they need to be replaced by the most modern ones if we want to reach one BILLION tonnes production!

vishal

2 years ago

the level of efficiency in both railways and coal India is such that any reforms require the efforts of the Unions and workmen to co operate. Will this be achieved. FDI in railway infrastructure will get bogged by this phenomenon. Unless a process is evolved to satisfy the unions to work with the Government all these plans will remain in paper.

Pulse Beat
Medical developments from around the world

 

Birds Can Better Predict the Weather

Infrasound, which can travel thousands of miles, is not audible to the human ears but birds can hear it. They can pick up the sound of large storms in the sea at least 24 hours before our radars. Watching bird migration could be a better science than electronic signals. True science is learning from nature.
 
“The most likely tip-off was the deep rumble that tornadoes produce, well below what humans can hear,” explains BBC News. “Noise in this ‘infrasound’ range travels thousands of kilometres, and may serve as something of an early warning system for animals that can pick it up.”
Dr Chris Hewson, a senior research ecologist at the British Trust for Ornithology, agrees with the infrasound hypothesis. Based on his understanding of weather formation patterns, warblers, falcons and other birds must have a special sense for how these weather events form, long before human understanding and technology is able to pick up the signals.
 

Coffee Drinking Could Be ‘Good’

“Dr Qian Xiao from the National Cancer Institute has found that people who drink three cups of coffee daily are 25% less likely than non-coffee drinkers to have abnormal levels of liver enzymes.” Please understand that this study is funded by the coffee industry. Though Dr Xioa has studied 27,000 people, the data are retrospective and based on the ability of those people to remember how many cups of coffee they had consumed in the past. Many such studies keep cropping up. Do not be surprised if you find an equal number of studies show that coffee is the villain in many human ailments! That is exactly why Mark Twain had warned us: “Do not read health reports; you might die of a misprint!”  How very true?
 

Lose Weight by Controlling Emotion

People who can read their emotions and control them better eat much more sensibly to keep their weight under control. Positive emotions could help lower your weight. If you are overweight and have failed to control it by eating less, try and see if you are at peace with your own self; it would help.
 

Free Healthcare for All?

Finances of the National Health Services (NHS) in Britain, where every kind of sickness care is free, are in dire straits. “If a crisis is the nadir, the turning point, the NHS in England can’t yet be judged to be in crisis,” said John Appleby of the health think tank—the King’s Fund—in a BBC interview. This is because things may well get worse. Hospitals around the country are declaring ‘major incidents’ because of a lack of beds or staff or both, emergency departments report that they are at breaking point, and general practice is under unprecedented pressure. And there is little sign yet of things improving. So says Fiona Godlee, the editor of the British Medical Journal, in her editorial. I think, the Modi government will take note not to give free Western medical services in our hospitals. We can still give better services, if only we had an integrated system of sickness-care where emergencies are managed with Western medical quick-fixes and the vast majority of minor illnesses can be managed by other systems after duly authenticating them. To give you an idea about how big the load is, see this data from a Canadian study. When a doctor sees ONE heart attack, he could have seen 36,000 minor illness syndromes. Most of the latter are self-curing but need something to boost their immune power which is better done with Ayurveda and other systems. This will be very healthy for the country’s Budget too. 

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Panagariya's prescription - Part IV: Social Spending

What are the economic ideas of Arvind Panagariya, the vice chairman of NITI Aayog? In a speech in February last year he had expressed rather radical ideas of reform on social spending. Will they be too hot for the PM? This is fourth part of a multi-part series 

 

Prime Minister Narendra Modi dismissed the Planning Commission and set up the National Institution for Transforming India (NITI) Aayog. As expected, Modi appointed his long-time supporter, economist and professor Arvind Panagariya as the vice chairman of NITI Aayog. Pangariya, as an economist is known for his radical views on reforms, and it would be interesting to see, if PM Modi subscribes to his views and actually carries out the NITI Aayog vice chairman's suggestions. What are his thoughts?
 
For this, let us turn to CD Deshmukh Memorial Lecture 'A Reform Agenda for India's New Government' on 11 February 2014. That lecture is fairly exhaustive and is almost a blue print for reforms and growth. Pangariya outlined a strategy of reforms along two tracks, one of faster, employment intensive growth and second, expanded and more effective social spending. 
 
Talking about expanded and effective social spending, he said, accelerated growth in GDP leads to accelerated growth in government revenues even when their share in GDP is unchanged. "Accelerated revenues translate into accelerated government spending. To illustrate what difference growth can make, observe that given a doubling of per-capita income between 1999–2000 and 2012–13, a per-capita expenditure on education achieved by allocating 4% of GDP to it in the latter year would have required the allocation of a whopping 8% of GDP to that sector in the former year. Therefore, the scope for expanding social spending rises rapidly with growth. But, it is important that this spending is effective in targeting the objective for which it is meant."
 
"Sadly, our existing social spending has been disproportionately failing in targeting its objectives. For example, according to a 2005 Planning Commission report, the Targeted public distribution system (PDS), which is designed to deliver subsidized food grain to the poor, spent a gigantic Rs3.65 to transfer just Re1 worth of subsidy to the poor. There are similar problems with our other programs such as rural employment under the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) and government delivery of health services. A large chunk of labour under MNREGA is wasted each year on projects that produce no tangible assets, public or private. Likewise, even in rural areas, nearly 80% of the population goes to private providers for outpatient care because the sub-centres and primary healthcare centres are often dysfunctional." 
 
"With its limited revenue resources and the vast need for the provision of food, education and health, India can ill-afford such poor delivery of services. Reforms must help make the delivery more effective," Panagariya said.
 
In his speech in February 2014, the now vice-chairman of NITI Aayog, focussed on six different areas, including the first two that overlap with infrastructure but are so important for human development that they bear repeating.
 

ELECTRIFICATION

 
It is a matter of great disappointment that one-third of Indian homes still lack access to electricity. Even homes equipped with an electric connection lack its flow around the clock, seven days a week. The problem is of mega proportions in two states: Bihar and Uttar Pradesh (UP). As of 2011, only 16% of households in Bihar and 37% in UP had electricity. This contrasts with states such as Gujarat where electricity is available around the clock and reached 90% households in 2001. Other states such as Tamil Nadu, Andhra Pradesh, Punjab and Haryana have also achieved similar success. 
 
The next government must take electrification on war footing bringing electricity to no less than 90% of the households in every state in ten years or less.
 

ALL-WEATHER RURAL ROADS

 
The NDA government had launched the Prime Minister’s Gram Sadak Yojana with the aim of connecting every village to state and national highways through all-weather roads. Like electrification, the next government must give this program a new lease of life and substantially fulfil the promise of the scheme in five years.
 

FOOD AND NUTRITION

 
India recently passed the Food Security Act of 2013, which promises to provide rice, wheat and millets at highly subsidized prices to 75% of the rural and 50% of the urban population. But there remain three key weaknesses of this approach to solving the problem of nutrition.
 
Proteins, not carbohydrates
This approach is centred on carbohydrates but the far more serious problem that India faces is the lack of protein in people’s diet. Cereal consumption at different levels of income does not vary at all in urban areas while it varies only by small margins in rural areas. But when it comes to milk, it varies between less than 1 kg per person per month among the bottom 5% to more than 10 kg per person per month among the top 5% of the households. This same discrepancy also applies to eggs and fruits and vegetables. So India needs to expand the white revolution while also taking steps to boost the production of fruits and vegetables. Above all, the country needs to boost the purchasing power of people to be able to afford these basic needs of ordinary citizens.
 
Information and awareness
Unless people themselves understand and appreciate the importance of a nutritious diet, giving them cereals at subsidized prices will be insufficient to persuade them to consume more of them. Chhattisgarh state has a well-functioning public distribution system with near universal coverage and yet cereal consumption at all levels of income in the state mirrors the national average. Therefore, the next government must promote sustained information campaigns on nutrition through all possible media outlets, including advertisements featuring top sports and movie stars, doctors, and even the prime minister.
 
Public Distribution System or cash transfers
Simple economics tells us that giving a part of the quantity of food grains consumed by households at subsidized prices has virtually no impact on the total quantity of their consumption of these grains. The experience of Chhattisgarh just mentioned testifies to this proposition. When we combine this observation with the massive leakages in the Public Distribution System—40% or more of grain provided by the Centre fails to reach the actual beneficiaries—the case for continuing this system is considerably weakened. The next government must seriously consider experimenting with direct cash transfers using all instrumentalities such as bank transfers, postal money orders and mobile phone technology. It should allow people a choice between cash and in-kind subsidies. This will empower people, who can decide whether they want cash and buy what they wish, and from whom they wish, or buy subsidized food from government shops.
 

EMPLOYMENT GUARANTEE IN RURAL AREAS

 
We now have MNREGA fully operational in all of rural India. While the scheme has put some purchasing power into the hands of poor households, the returns on it remain poor on many fronts. First, there has been little creation of public assets. This has meant that both the material and the labour used on projects have been largely wasted. Second, the scheme has seen far less success in providing employment in the poorer states than in the richer states. 
 
According to the accountability initiative at the Centre for Policy Research, in 2010–11, Uttar Pradesh state generated 13% of the total MGNREGA employment despite accounting for 20% of the below-poverty-line (BPL) rural population of India. Andhra Pradesh and Tamil Nadu provided 23% of the total MGNREGA employment even though they together accounted for only 8% of the country’s rural BPL households. Finally, MNREGA produces no skills. Indeed, it requires that employment be of the unskilled nature. My own recommendation would once again be to allow households a choice between cash transfers at the rate of 75% or less of the NREGA wages and employment at full wages. 
 
If the government finds this politically infeasible, it must try to forge a link between MNREGA and the building of houses and toilets for the poor in the village using the labour and materials made available under the scheme. Given that those employed are also predominantly poor, this approach would produce a coincidence of the interests of those doing the building work and those benefiting from it. Such a link may also bring about some checks to corruption in the existing public works programs.
 

ELEMENTARY EDUCATION

 
Like higher education, elementary education in India remains in crisis. Enrolments have steadily risen in the last decade to levels that now leave only a tiny proportion of children between 6 and 14 years out of school. In turn, this has made it feasible for the UPA II government to pass in 2009 legislation implementing a right to education. But, the quality of education in government schools as measured by student achievements is low and declining. We must consider at least two possible solutions:
 
Priority given to performance in school evaluation criteria  
In assessing schools for the purposes of recognition, the Right to Education (RTE) Act relies exclusively on input norms. Offering automatic promotions at all levels, it also does away with all board examinations. We need to revisit these provisions and perhaps consider giving the states greater room in deciding the norms. In Gujarat, the government has chosen to give 70% weight to academic achievements of students when evaluating a school for continuing recognition. In all likelihood, this practice does not conform to the RTE Act and may be challenged in the courts. This threat must be removed by empowering states to amend the RTE legislation to suit local conditions.
 
Greater freedom in school choice
The RTE Act reserves 25% enrolment in unaided private schools for economically and socially disadvantaged students. The Act also commits the government to funding these students at the same level as the expense incurred per student in government schools. This provision can potentially serve as an instrument for expanding private school enrolments. But a more effective means of empowerment would be to give the parents vouchers in the amount the state spends per child on education and let them decide whether they wish to go to a private or government school. 
 

HEALTH

 
India is in urgent need of a comprehensive health policy. Let me spell out some broad contours of what the next government must try to accomplish.
 
Public health
Today, public health is the weakest link in our health delivery system. By the same token, public health promises the highest social return on investment. Most states invest their meagre resources in curative care rather than public health services. The result has been the neglect of public health services such as drainage systems, supply of drinking water and sanitation. A bout of monsoon rains is often enough to clog drains and create swampy conditions conducive to the quick spread of communicable diseases. The next government must change this state of affairs. It must persuade states to create separate public health departments with their own budgets. In addition, it must take the provision of piped water and modern toilets on a war footing. It should be the goal of the next government to ensure that every house has piped water and a toilet within ten years. It must also work tirelessly to create greater awareness among citizens toward personal hygiene and sanitary conditions in the surrounding areas. Tolerance for unhygienic conditions in India remains high, relative to other countries, and this needs to be changed.
 
Medical personnel
India faces exceptional shortages of health related human resources—doctors, nurse practitioners, nurses, midwives and pharmacists. Unqualified providers dominate the private sector, especially in rural areas. Growing incomes, populations and efforts by the government to improve access to health services will magnify this shortage. Therefore, the next government will need to invest in improving the medical human-resource base in a major way. It must create one-year basic training programs for all rural medical providers through District Health Knowledge Institutes. It should also massively expand the number of qualified MBBS doctors. 
 
This requires loosening the stranglehold of the Medical Council of India. In turn, this can be achieved by allowing each state to establish its own medical council that decides the norms for opening medical colleges and the norms of medical practice within the state.
 
Routine healthcare
The next government should ensure that citizens have enough purchasing power to access routine healthcare services. While the government can offer these services at cost, it should let patients decide whether they wish to go to a government or private facility. This will promote efficiency. For example, many routine illnesses can be dealt with through home remedies so that citizens may sometimes wish to save the potential expense of the treatment of those illnesses for a rainy day.
 
Major illnesses
Major illnesses result in a large expense per episode and often involve surgical procedures. Childbirth and maternity care also fall in this category. Here we need medical insurance. Several insurance schemes are currently in operation but it is time that we aim to expand them to achieve near universal coverage. The next government must consider covering the bottom half of the families for up to Rs50,000 per year of medical expenses on major illnesses at its expense.
 

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