And, yet, between them, the large internet platforms have suffered few, if any, consequences for their many misdemeanours. They have not been punished by the market (consumers and clients), they have not been swamped by competition, and they have certainly not been checked by governmental authorities. How did they get so powerful? Can they ever be held accountable for their actions? These are the pressing questions on the minds of academia and policymakers around the world. And, while Elizabeth Warren is today the most high-profile political proponent of a drastic solution, she may only be the first.

The Curse of Bigness

In calling for the likes of Facebook and Google to be broken up, Warren is echoing similar calls being made in academic circles and elsewhere. Prominent among these voices has been Tim Wu, a professor at Columbia Law School.

• Wu, famous for coining the term “net neutrality,” has, in his recent book The Curse of Bigness (2018), called for the adoption of a “neo-Brandesian” approach to the use of antitrust laws in the US, specifically in the context of internet platforms.1 Wu argues that the approach of the US Department of Justice has allowed internet platforms to amass economic power in a manner that could threaten the very future of democracy.
• He points out how in the past such concentrations of economic power, even by information technology companies (notably AT&T, IBM, and Microsoft), were effectively attacked using antitrust laws, resulting in the birth of the internet as we know it today (Kumar 2019).
• That is not the only argument that Wu makes in his book. He traces the political origins of the principal antitrust law in the US, the Sherman Act, 1896, and the underlying concerns which it was trying to address.
• He finds that the concerns were primarily political, that the amassing of such economic power as the world had never seen before in the hands of the robber barons of the so-called “gilded age” in the US were considered a threat to democracy.
• Election campaigns were fought and won on the pledge to break up the vast business empires of the likes of J D Rockefeller and J P Morgan. The speeches of the political leaders of the time, especially President Theodore Roosevelt, show that the concern was not just to address market failures, but also to stave off potential threats to democratic systems of governance posed by the so-called “trusts” which controlled businesses.
• This political aspect of antitrust, however, was lost since the 1980s as the so-called Chicago school of economists (led by Robert Bork) gained prominence. Wu argues that the Chicago school’s approach disingenuously tried to simplify antitrust law for lawyers and judges by reducing the whole field to the question of whether consumer welfare was being affected by a cartel or a monopoly.
• This approach also fit within the larger political move to shrink the state and give free rein to businesses, or the so-called “Reagonomics,” and this found favour with the governments and judges of the day. In Wu’s telling, this approach has allowed regulators in the US to ignore the harmful effects of internet platforms swallowing their competitors whole.

He points specifically to Facebook being allowed to acquire Instagram and WhatsApp without a murmur of disapproval from the authorities.

• Wu calls for a “neo-Brandesian” app­roach to the problem of tackling internet platforms’ dominance. While still short on specifics, The Curse of Bigness explains the broad outlines of the approach, harking back to Justice Louis Brandeis, a pioneering trust-busting judge.
• The approach calls for greater enforcement of existing laws to hinder the outright acquisition of competitors. Wu does not rule out the need to break up the existing tech companies to separate the various things to prevent them from getting access to more and more of our data.

For instance, he suggests a “de-merger” of Instagram and Whats­App from Facebook, allowing these platforms to compete rather than collude over users’ data.

Why Data Is Not the New Oil

Wu’s comparison of the near monopoly of present-day internet platforms with the Rockefeller-owned Standard Oil Trust might tempt one to conclude that “data is the new oil.” Inasmuch as data is a valuable resource and will continue to be so in the coming decades, it is true, but the comparison stops there. Data, unlike oil, is more valuable the more there is of it.

• While increased production of petroleum might lead to prices ­dropping, it is just the opposite with data. While petroleum can be mapped to jurisdictions and boundaries, data ­cannot. While petroleum, like all other natural resources, is finite, data is potentially infinite.
• As Wu points out, internet platforms owe their power to the network effect. With Google and Facebook offering their products free, there is little chance of a competitor being able to undercut them by price. Even when a competitor comes along with a better product, their accumulated capital allows competitors to be acquired swiftly, with little regulatory disapproval.
• Even if a competitor were to arise, they would be unable to compete on one key feature: data. Internet platforms probably know their customers better than they themselves do. The vast ecosystem of apps and devices which go along with the internet platforms means that incumbents will be virtually unassailable by entrants in the kind of service that they can provide their consumers.
• Seen in this light, Wu’s and Warren’s calls for antitrust action against internet platform companies cannot come too soon. They are of relevance for India too. While internet penetration in India is still low enough that it is possible for new entrants to compete with the incumbents (for example, the successful entry of Chinese apps into the Indian market) (Shaikh 2019), the concerns cannot be entirely brushed aside.
• The Competition Commission of India’s order in the context of Google Flights (John 2018), and the foreign direct investment in e-commerce policy limiting e-commerce companies from selling their own products (Badri Narayanan and Juneja 2019)2 are two instances of pushback on such concerns from regulators and concerned agencies.

The measures to prevent monopolisation of data in India could be both ex ante and post facto, depending on the situation and the powers of the regulator.

• Whether regulators in the US are alive to the fact or not, those around the world (especially in the European Union) are growing wary of the increasing economic clout of the internet platforms. The pushback has taken many forms, whether in the form of the European Commission levying one of its largest fines on Google for violations of EU competition law (Warren 2018), or India’s net neutrality regulations.
• If the US DoJ were to drop its laissez-faire attitude towards applying antitrust law and regulations on internet platforms, a new front may be opened in this long-running battle.

Notes

1. For the purposes of this column, the terms “competition law” and “antitrust” will be used interchangeably, though the latter is mostly used in the American context, while other jurisdictions discussed here use the former term.
2. However, the fact that this principle has not yet been extended to Indian e-commerce companies suggests protectionism rather than genuine concern over competition.

New Rural–Agrarian Agitations

• The recent farmers’ protests manifest the emergence of a new politics evolving in and around the rural–agrarian question. Although this new politics can also be seen as an amalgamation of farmers’ politics during the 1960s and 1980s, the more immediate reasons can be found in the socio-economic changes that happened in the Indian countryside after the economic reforms of 1991.
• The economic reforms did produce massive changes in various parts of India, including in regions like Malwa in Madhya Pradesh, Vidarbha in Maharashtra, or Sikar in Rajasthan, where the first wave of protests started. These regions have undergone significant economic and social changes in the last three decades (Suthar 2017a, 2017b).
• These protests initially began in the Mandsaur town in Madhya Pradesh in June 2017. The protesting farmers were demanding the waiver of agricultural loans and a rationalised MSP covering more crops as well as input costs based on the Swaminathan Committee report’s recommendations.
• This led to a nationwide farmers’ protest after the killing of six farmers in police firing. Soon, various farmers’ organisations from Maharashtra, Punjab, Rajasthan, Uttar Pradesh, among others, came in support of Mandsaur farmers.
• This common reaction was just the beginning of large numbers of agitations, which were to commence in the next few months. Several farmers from Tamil Nadu also gathered during the same time at the Jantar Mantar in Delhi, holding human skulls, bones, and dead rats in their mouths, symbolising their poor living conditions.
• A month later, farmers in Sikar and Ganganagar districts of Rajasthan also protested against the government’s negligence of farmers’ issues. The entire district of Sikar came to a standstill when people from every walk of life came in support of the protesting farmers.
• Eventually, these agitations resulted in the formation of a joint platform of around 180 farmers’ organisations working in different parts, called All India Kisan Sangharsh Coordination Committee (AIKAsCC).
• These agitations culminated in a massive protest march followed by a Kisan Sansad (farmers’ parliament) in the national capital on 20–21 November 2017, attended by thousands of farmers.
• The most significant show of strength of farmers was witnessed when around 50,000 farmers marched on foot from Nashik to Mumbai to pressurise the Government of Maharashtra to accept their demands.
• These agitations have been very diverse in their strategies and methods of mobilisation. Mostly, the protests were remarkably peaceful and well organised. The demonstrations were organised forms of political resistance with participation from diverse socio-economic groups or castes and classes.
• A large number of women along with educated youth took part in these protests. Unlike the 1980s movements, the leadership in these movements was not very traditional in outlook.
• These protests witnessed the emergence of an informed, professional new leadership—very articulate and technologically sound—along with the traditional form of leadership.
• Many of the protests also had a very successful social media campaign to garner nationwide support. These protests were also characterised by a unique mix of unorganised and decentralised forms of mobilisation as well as a highly coordinated and organised form, led by the All India Kisan Sabha (AIKS).
• In Madhya Pradesh, Punjab and western Uttar Pradesh, protests were largely coordinated by the local farmers’ organisations. In the case of Sikar (Rajasthan) and Maharashtra, on the contrary, protests were organised by the AIKS.
• In the case of Sikar, the entire city, and in the case of Maharashtra, an entire region came to a standstill. In the case of Sikar, people from all walks of life including bus and taxi drivers, rickshaw pullers, students, women, and landless labourers participated in the protests.
• A national magazine had called the protests a “farmer’s revolt.” Similarly, in an interview, Yogendra Yadav, a political activist associated with Swaraj Abhiyan also called this a historic moment and a move towards “peasant rebellion.”
• Probably, it is too premature to categorise these protests as a movement or to judge them with a yardstick of “success” or “failure,” but they do reflect a qualitative shift in the politics in rural India.
• This political shift is an outcome of specific processes of sociological and economic changes that took place since the introduction of large-scale economic reforms in 1991.

The Rural–Agrarian and the Urban

• Since independence, the rural–agrarian society in India has undergone two significant phases of socio-economic transformation. Economically, both these phases produced newer classes, whereas sociologically, they resulted in the emergence of new rural sociocultural value structures.
• These changes further led to new forms of political mobilisation in the countryside, demanding more state support for the agricultural sector. But both these phases also generated different kinds of crisis and stress situations.
• The first phase produced a rural–agrarian crisis whereas the second phase, after the 1991 economic reforms, led to a crisis in the urban. The present phase of rural–agrarian protests can be seen as an amalgamation of both these “crises” situations, which look back to the rural–agrarian as a way out.
• The first phase of rural–agrarian change occurred after the green revolution during the late 1960s. This phase was characterised by high growth in agricultural production, bringing economic development in the selective regions of India.
• Socially, this also facilitated the emergence of a new rural landed class, which was looking up to more state support for agricultural development. This class asserted its demands politically by organising massive protest rallies in New Delhi during the 1980s.
• However, these acts of political assertion were organised in a decentralised manner, and also lacked any concrete ideological basis.
• K Balagopal (1987) had called this new landed and educated class the “provincial propertied class.” Though this class had expanded itself into urban areas through its economic diversification or by investing into the properties or business, it always looked back to the rural as a support base.
• Strong ties with the rural compelled them to articulate the demands of the rural–agrarian sector politically. A major factor behind this section’s political activism in defence of the rural was a sense of nostalgia and attachment resulting from their embeddedness in the rural sociocultural spheres.
• Consequently, apart from the political economy reasoning behind demanding more state support, preservation of the rural society and its sociocultural ethos was also adopted as a major mobilisation strategy by these movements (Gupta 1997).
• This new class also criticised the existing model of development for giving precedence to urban India at the cost of the rural and agrarian India.
• However, the farmers’ politics during the 1980s largely remained confined to protection of the political and economic interests of a particular class of the rural–agrarian, especially the landed class. They hardly had any transformative agenda for the holistic development of the rural.
• The agenda of the rural poor or landless labourers or the rising inequalities due to the impact of green revolution were either sidelined or were missing from the political campaigns of these movements.
• Tom Brass (1999) and other scholars had discussed these “new farmer movements” highlighting some of the limitations of these movements, including a tendency to support the right-wing political forces.
• The second phase of the rural–agrarian transformation occurred in the aftermath of 1991 economic reforms. Unlike the late 1980s, this phase witnessed declining state investment in the agricultural sector and linking of Indian and global agricultural sectors.
• Besides, the expansion of the service sector in the Indian economy also resulted in the rise of the informal economy, small-scale business activities and enlargement of education industry (Jodhka 2014).
• These developments in the Indian economy opened up newer employment and social avenues for the people living in rural areas. Consequently, urban areas became the new sought-after destination of the youth and middle class who were educated and also desired a modern lifestyle.
• Besides, the emergence of a new informal economy in the urban areas as well as in the mandi spaces also led to the socio-economic transformation of rural society (Vasavi 2012; Gupta 2005; Jodhka 2014; Harriss-White and Shah 2011; Mohanty 2005).
• The new economy produced new sociocultural values of individualisation and led to the disintegration of caste and other social hierarchies in the rural areas.
• Overall, these structural economic changes resulted in, what Jodhka calls, “emergent ruralities.” According to Jodhka, the new rural was qualitatively different from the rural society of the late 1980s. He further explained it in the case of Punjab (Jodhka 2006: 1534):
• Growing obsession with the so-called “new economy,” information technology, media and the urban consumers led to a complete marginalisation of “rural” and agrarian sector.
• Farmers were looking at avenues to move out of agriculture as well as from the rural areas. They preferred employment as security guards or any other low-paid jobs in the city spaces than being small cultivators.
• The middle- or marginal-farmer households began investing heavily in the education of children, especially in the field of technical education or coaching economy with a dream of joining organised sector employment.
• Unlike the 1980s, when the socio-economic change had fostered political assertion of the farmers, the second phase produced some form of depoliticisation of the rural–agrarian society. Politics was not seen as a collective social activity but as an instrument either for economic gains or as a waste of time and energy.
• However, for the marginalised groups, electoral politics was the only ray of hope. The farmers’ movements of the 1980s had not incorporated the demands of socially marginalised groups into their political agenda.
• Consequently, these sections, especially the rural-educated youth coming from marginalised groups saw electoral and organised politics as the only political tool available to them for protection of their socio-economic interests.
• This political consciousness amongst the marginalised groups led to the emergence of the politics of the “bahujan” (Yadav 2002). These emerging forms of political mobilisations produced political as well as social contradictions in the rural and agrarian political realm.
• These contradictions required a new understanding of determinants of politics and also of the society and economy of the rural. Priyanshu Gupta and Manish Thakur (2017) have argued that the classical political economy approach of the rural–agrarian dominance may not be very useful in understanding the “fundamental transformation of the ‘village’ from the spatial habitat of the traditionally ‘dominant’ to the ‘waiting room’ for the aspiring and the despairing.”
• In addition to this, the rural–agrarian discourse has remained village- and agriculture-centric. With the changing nature of economy and “ruralities,” there are strong rural–urban linkages emerging.
• These linkages are producing newer interactions between the two sets of social values, putting rural–agrarian on the centre stage. In a special issue of Review of Rural Affairs in this journal, the limitations of the existing “formulations like Bharat versus India, the narratives of ‘crises’ or even the formulation of rurbanity” were highlighted (Jodhka 2016).
• Largely agreeing with these limitations, this paper argues that a new process of “rural–agrarian–urban,” linking three processes while retaining some of their essence simultaneously, is shaping the 21st-century rural India.
• The new rural–agrarian is a product of the aforementioned two phases. This new linkage has produced newer crises situations on the one hand, but also produced newer forms of political possibilities and aspirations of the rural on the other.
• This is getting consolidated in the form of a quest for a new identity. Although it is yet unclear what this identity would be, it appears to be a mix of individual as well as community values, community building around the agrarian and the land, and finally, a new rural with modern facilities.

Quest for Rural–Agrarian Identity

• The present protests are a political manifestation of the increasing quest for a new identity. This identity is a mix of an individual (being and dignity) as well as a collective sense of belonging.
• This also emerges from a sense of disillusionment from the urbanisation process but also a desire to reimagine the rural in newer ways with more space for individual freedom.
• It is also based upon newer aspirations in the rural where city-like facilities are demanded. It is this complex interplay between the rural and the urban with agrarian in the middle that makes the new process of politicisation over the agenda of rural–agrarian possible.
• Both the processes of agrarian crises and anti-urban sentiments have produced an identity crisis, not only in an individual but also in a collective sense. As an individual, this quest is driven by one’s sense of loss of self-dignity and respect resulting from economic as well as social reasons.
• But it is also linked with one’s sense of getting lost in an urban crowd. With the rise of individualised and consumerist lifestyles in the urban areas, the sense of community has gradually weakened. This has also led to an anxiety arising out of the present conditions of rural society.
• These disillusioned social groups belonging to the rural or/and urban spaces find the focus on issues plaguing the rural–agrarian as a more effective agenda for political assertion. There are two reasons behind this.
• First is a gradual realisation of sense of urban impacting upon the agrarian (Gurunani and Dasgupta 2018). This impact is strongly linked with, but not confined to, the spatial questions like land acquisition for various projects for urban expansion. Rather, it has deeper socio-economic implications on everyday life of the rural–agrarian.
• Secondly, the rural–agrarian is still seen as a cultural community with a sense of belonging and brotherhood. This makes the rural–agrarian a possible notional sight of protest and mobilisation.
• The farmers came out protesting against government policies as they are left with no other choice, as highlighted by many people during the author’s fieldwork. Some of the factors like declining prices of agricultural products, increasing expenditure on agricultural inputs and also increasing costs of education and health are responsible for making rural life miserable (Reddy and Mishra 2009; Himanshu 2018).
• What made the present protests different from earlier ones was the massive participation by all sections of the rural–agrarian society. Not only the male farmers, who have historically been a dominant group in farmer politics, but also many other social categories such as women, youth, middle-aged persons, educated and uneducated persons, tribals, and even the landless took part in these protests.
• The primary reason behind this is that the agrarian crisis is not confined to farmers and affects all sections of the rural society who are directly or indirectly associated with agriculture or allied professions.
• In the case of urban crises, it involves those who may not be involved in farming directly but are still associated with rural society through their kinship or social networks or because they continue to own a piece of land in the rural areas.
• This social group consists of those who had moved out of rural life some years ago with new aspirations. They either came to urban spaces to study and find employment or for better living conditions.
• However, these classes soon realised that even urban life had its own problems, including an expansive consumerist lifestyle, individualised life, urban forms of discriminations and so on.
• Besides, gradually declining economic opportunities, and jobs in the private sector becoming less lucrative and more exploitative have made urban spaces difficult for those who were the first-generation to move to the city from the family or the village.
• The prospect of moving to urban areas gave hope amidst the rising crisis in rural–agrarian society, resulting in massive migrations to city spaces. However, emerging challenges of survival in the urban areas are leading to a reverse push from the urban areas as well.
• Those who took part in the recent protests were not able to articulate the nature of this “new” identity, but acknowledged that rural India needs to reinvent itself, if it wanted to survive.
• Rajaram Singh, who is the national secretary of All India Kisan Mahasabha and was an active partner in the AIKScC, spoke to the author during the Kisan Sansad, a mock parliament by the people coming from rural areas, on Parliament Street in Delhi on 20–21 November 2017. He mentioned:
• Ye kisan ke liye, gaon ke liye, astitva aur pehchan ki ladai hai. Hamare pas iske siva koi rasta hi nahin hai. (It is a fight for survival and identity for the rural–agrarian India. We have no other way but to speak against this. (referring to the protests)3
• Yashwant had also come to take part in the Kisan Sansad. Yashwant, a combine driver from Sangrur district of Punjab is not a cultivator, nor did he own any land. However, in response to the question on why he was here, he said:
• We have no choice but to fight. Have you ever heard of banks taking action against an industrial defaulter? But when a farmer fails to repay a loan for few months after paying it in time for two to three or more years, the bank authorities start knocking his doors and threatening him.
• You have a job, and you get a salary. Our boys are without any work. I need to come here for them. I am not bothered about the result. But I feel satisfied that I did my due.4
• Broadly, three major reasons behind this shift in the nature of the rural–agrarian and quest for new identity can be identified. There are pull- and-push factors involved here. Push factors are forcing people to move away from urban spaces whereas pull factors are those attracting people back to the rural–agrarian.

Urban Spaces, Unfulfilled Aspirations

• The most crucial determinant of this phenomenon in the category of push factors is the emergence of negative externalities associated with urbanisation. These include lack of job opportunities, high living costs in the cities and above all, the increasing sense of alienation and exclusion.
• The individualised urban lifestyle promotes a sense of social isolation, and also an absence of the sense of belonging. Besides, the faster pace of competitive life is challenging for people coming from the rural–agrarian sector.
• The new rural–agrarian youth, who shifted to the urban spaces looking for a better life, now feels disillusioned and left out in the city.
• Prakash was amongst the farmers who had come from Tamil Nadu, and could not complete his engineering because of crop failure and his inability to pay the bank loan. He said: People tried shifting to urban areas and looking for new avenues.
• But all of them are dissatisfied. They got nothing. Even my family tried it. Many others also did. Many families are puzzled. Our future is in the villages and not in cities. What do we do in cities? We cannot even pay the rent of the house. In the village, we had a house and a respectable life. In the city, nobody knows you.
• This has further compelled people, especially the younger generation, to look back at rural areas, which had some sense of belonging, psychological association and also availability of, or at least a myth of presence of a social support system.
• What attracts them towards the rural, or keeps them associated with it, is its vibrant social life, fresh air, fresh vegetables, a relatively less expensive lifestyle and above all a sense of community.
• On the contrary, the idea of urban lifestyle is associated with multiple forms of exclusions and discrimination leading to disillusionment with the urban way of life.
• Sudhakar who holds a graduate degree and started his dairy farm was also on the streets of Delhi for a month. In response to the question on why he was here, he replied:
• I am here for my sons. I want to give them a decent life. This life is possible only in the village. They should go out, study and learn new things but village gives you a natural life. My parents gave me that and I want to give this to my children. It is not a fight for money. It is a fight for prestige and rural survival.
• Amra Ram from the AIKS, who was one of the prominent leaders of the movement, explained what made this possible:
• Everyone realises that the rural–agrarian is in a deep crisis. The fact is that India is a rural society which is largely agrarian. Youth do not see any other future and have no option other than to fight for the survival of rural India.
• They also understand the need to change if this fight has to be won. Ye smajh ki ise bachane ke liye ladayi jaruri hai, is andolan ki saflta hai (It was this realisation that resistance is necessary which made this movement a success).
• It is necessary to highlight here that this may not be a pan-India rural phenomenon. Besides, this feeling of looking back to the rural may not be present among all sections of the rural–agrarian society.

Education and Migration

• Another major push factor taking people away from the urban is the massive privatisation and commercialisation of the education sector and a simultaneous but gradual withdrawal of the state from organised sector employment.
• One major factor during the 1980s attracting people to the urban areas was the availability of educational institutions. Scholars have highlighted (Gill 1985; Balagopal 1987; Vasavi 2012; Jodhka 2014) how increasing access to education had played a crucial role in changing the rural society.
• It was one of the major causes of migration from the rural to urban areas. Dipankar Gupta (2015: 41) has argued that, “an important and necessary condition for being a ‘rurbanite’ is education.” He had further argued that it was the rural poor who were spending on education much more than what they could afford.
• The increasing youth participation in the education sector had exposed them to a new culture of consumerism and individualism in the urban areas.
• However, the growing expenditure on various educational heads, especially on the tuition fee on the one hand and increasing role of coaching centres on the other, had also put this new generation of rural youngsters under immense psychological stress.
• In Wardha city, I spoke to a 14-year-old boy in the month of June, during the school vacation period. He belonged to a nearby village and had just taken the ClassX exams.
• He was living in Wardha to attend coaching classes for Maharashtra Public Service Commission and Indian Engineering Services entrance exams, along with mathematics tuition classes for Class XI and Class XII syllabuses. I asked him why he had taken on so many assignments instead of enjoying his vacations at home. He replied:
• Sir, we are people from the village. People from the cities think that we are backward. Since we come from a rural background (gaon se aate hain) therefore, we do not know how to live a good life (achha jivan).
• I want to do well in my life. I want to achieve something and want to show these people in cities that we villagers can also progress and do well in our lives. That’s why I am doing so many things in studies now.
• Surprisingly, he also said that there are problems in the villages as there is too much of interference in personal life. However, he also added that in case of cities, no one cares for others. In the village community, one could call people immediately in case of an emergency.
• In the times of agrarian crisis, families of such youth could hardly afford to pay for their education. Simultaneously, there is a pressure to perform well in order to secure a better future.
• Increasing access to education is not commensurate to the employment opportunities available. But there is an increasing sense of anxiety due to the lack of job opportunities in urban areas.5 Most of the available jobs in the cities are in the private sector.
• These employment opportunities are contractual, short-term opportunities, and are also not very well paid. The kind of humiliation and discrimination one has to face in these workplaces further generates a sense of inferiority.
• The exploitation and marginalisation in the urban job market have worsened in the last two decades. Jitendra (aged 32), from Trivedi Ka Purwa village of Banda district, Uttar Pradesh, used to work as a security guard in Kanpur.
• He lost his hand in an accident. The company threw him out and also did not pay his remaining salary. “I thought it is better to go back and work on the land instead of facing insult in the cities.” Now he does farming in the village along with his family.6
• As a result of job-market-related challenges, the rural youth who are now educated and exposed to the urban lifestyle and its comforts, find it financially unaffordable. Mostly, these youth belong to marginal or small farmers’ households with an upper-middle caste family background.
• They do carry a sense of prestige originating from their caste–class location in the rural se-up. Profitable agriculture and rural community play the roles of support systems in case of a crisis in the city spaces.
• However, with the economic crisis in the agrarian economy on the one hand and increasing socio-economic complexities in the rural society on the other, they suddenly feel a significant loss of that support system.
• Any political mobilisation around the rural–agrarian question is a potential point of reclaiming that past. It is this mix of alienation, exclusion, and insecurities amongst urbanised youth that is leading to the rise of popular agitations in defence of the rural–agrarian.
• While conducting fieldwork in Nagpur during May 2017, I interviewed a few youngsters who were continuing their studies in the city. Although they were living in the cities since long, they wanted to go back to their villages provided they get some economic opportunities there.
• They also had the dilemma of village social life being one with too much interference in individual lives, but they juxtaposed it with the discrimination and alienation present in the urban spaces as well. They all expressed their anxieties with the prevailing conditions in rural India and therefore articulated the need to rebuild the rural–agrarian.
• While attending the massive farmers’ protests in Delhi in July and later in November 2017, various participants mentioned that although they themselves might not be farmers, they were related to the rural economy that is integral to the farming sector.
• They have relatives and friends who are farmers, and therefore they believe that it is their moral responsibility to stand with them in times of crisis.
• Santosh Lakshmanrao from Yavatmal district of Vidarbha articulated their plight, two months before these agitations started:
• Agriculture and rural society are in terrible condition. We do not know how to articulate it, but we know that the government does not take us seriously. The government works for big players (bade log) and not for farmers and the poor. This will turn explosive one day. When, and how I do not know.
• The village Donoda to which Lakshmanrao belongs had seen more than one villager committing suicide almost every year in the last one decade. When I spoke to some of the youngsters they argued: “Sir, you talk only about those who have committed suicide. What about those who died due to depression or shock because of social pressure? Is that not suicide or murder?”
• When I was clicking their pictures, one of them said: “Sir, take a picture of this person (pointing to the man standing next to him). He is going to commit suicide soon.”
• He continued, “He will commit suicide soon and one by one in the next few years, we all will. He refused to tell me his name.” The unrest was visible on their faces. Another person standing next to him added:
• We all are graduates. We did not get a job after completing our education. By the time we finished our degrees, there were no jobs. Even if there were, one has to pay a heavy amount to purchase a job position. For this, a farmer has to sell his land.
• We did not want to sell our land due to our emotional attachment to the land and village. Hence, we decided to continue with agriculture and live in the village. Now we are into agriculture with three–four acres of land. This land is not enough for leading a good life in today’s times.
• Nobody wants their daughters to marry boys like us. Because we live in a village and we do not have wealth, we remain unmarried though we are touching 30s. Sir, you tell us, what charm we have in life? Our life is a waste.8
• He laughed along with others. Such narratives reflect a sense of anxiety, alienation and above all a sense of identity crisis in people living in rural areas engaged in agriculture.

The Land Question

• Another major factor contributing to the emergence of the new identity is the question of land. The land question has been in the news since the last two decades due to increasing cases of disputes between the farmers and the government over land acquisition for various industrial or other developmental projects.
• Traditionally, land was seen as a major asset in rural society. It was a source of livelihood, social prestige and also provided a sense of security. However, this emotional attachment with land had witnessed a change in the last two decades due to the increasing inclination towards urban spaces and declining interest in agriculture.
• With a gradual decline in the number of jobs available in the market, an increasing sense of exclusion in the urban settings and a sudden jump in the land prices due to increasing demands for various urbanisation projects, the rural youth have started looking back to land as a source of support, prestige, and economic security.
• Some of the protests around the land question during late 1990s and 2000s were about the disputes over the amount offered by the government as compensation. However, the recent protests are against the very idea of land acquisition.
• Villagers have gradually started refusing to give away their land irrespective of the amount offered. The question of land is no more about the agricultural land but is also associated with the idea of natural resources and their ownership (Naga 2016).
• Vijoo Krishnan, who works with the AIKS and has been quite proactive in articulating farmers’ unrest, said in a conversation with the author:
• It is wrong to assume that these protests are sporadic and they occurred suddenly. They are just a manifestation of farmers’ unrest against the manner in which various governments have been dealing with their concerns.
• In many states, the government had been proactively involved in giving away the land to the corporates without even taking farmers’ concerns into account.
• This change of attitude is also an outcome of some of the policies adopted by various governments to create alternative sources of income in the rural areas itself. In case of Kerala, Rajasthan and Gujarat, the state governments had invested in making villages into tourist destinations with policies such as “ideal villages,” “homestays,” “weekend holidays” that generated employment opportunities and sources of income within the rural spaces (Verghese 2018).
• In the case of Punjab, many farmers have opened their farms to tourists. These experiments served twin objectives: promoting tourism and also making people aware of rural lifestyle and agriculture.
• This kind of exposure has also helped in generating a sense of confidence and self-pride amongst the villagers. With such activities, the prices of land have gone up. Besides, people also consider ownership of even a small piece of land in such areas as a major asset.

Conclusions

• The recent farmers’ protests show certain continuities as well as changes in the rural–agrarian politics. Although it is difficult and premature to measure them in terms of “success” and “failure,” these protests have given the farmers’ politics a new lease of life.
• The sudden emergence of these protests symbolises the underlying deep and silent processes of socio-economic change in the countryside. These protests also reflect certain profound changes emerging in Indian politics.
• They constitute a rather unorganised and fluid form of politics and can be interpreted as the post-ideological phase of Indian politics. How far these protests will have an impact on India’s electoral politics is an open question.
• The survival and strength of these protests will depend upon their ability to confront the few challenges that were also faced by the farmers’ movements during the 1980s, such as the questions of rural poverty and labour and resolution of the caste–class dichotomy existing in the rural areas.
• Above all, the future of these movements is contingent upon their ability to fight with the ongoing religion- and caste-based polarisation on the one hand and massive penetration of the market forces on the other.

For decades, India’s statistical machinery has enjoyed a high level of reputation for the integrity of the data it produced on a range of economic and social parameters. It has often been criticised for the quality of its estimates, but never were allegations made of political interference influencing decisions and the estimates themselves.

Lately, Indian statistics and the institutions associated with it have however come under a cloud for being influenced and indeed even controlled by political considerations.

• In early 2015, the CSO issued a new gross domestic product (GDP) series (with the revised base year 2011–12), which showed a significantly faster growth rate for 2012–13 and 2013–14 compared to growth under the earlier series.
• These revised estimates were surprising as they did not square with related macroaggregates. Since then, with almost every new release of GDP numbers, more problems with the base year revision have come to light. In January 2019, for instance, the CSO’s revised estimates of GDP growth rate for 2016–17 (the year of demonetisation) shot up by 1.1 percentage points to 8.2%, the highest in a decade.

This seems to be at variance with the evidence marshalled by many economists.

• In 2018, two competing back series for varying lengths of time were prepared separately by two official bodies, (a committee of) the National Statistical Commission (NSC) and later by the CSO.
• The two showed quite opposite growth rates for the last decade. The NSC numbers were removed from the official website and the CSO numbers were later presented to the public by the Niti Aayog, an advisory body which had hitherto no expertise in statistical data collection.

All this caused great damage to the institutional integrity of the autonomous statistical bodies.

• In December 2018, the schedule for the release of results from the Periodic Labour Force Survey (PLFS) of the NSSO was not met. This was the first economy-wide employment survey conducted by the NSSO after 2011–12 and was therefore deemed important.
• Two members of the NSC, including the acting chairperson, subsequently resigned because they felt the NSSO was delaying the release of the report, though the NSC itself had officially cleared it. Subsequently, news reports based on leaks of the report showed an unprecedented rise in unemployment rates in 2017–18; this perhaps explained why the government did not want to release the report.

There have since been news reports that the PLFS of 2017–18 will be scrapped altogether by the government.

• In fact, any statistics that casts an iota of doubt on the achievement of the government seems to get revised or suppressed on the basis of some questionable methodology.
• This is the time for all professional economists, statisticians, independent researchers in policy—regardless of their political and ideological leanings—to come together to raise their voice against the tendency to suppress uncomfortable data, and impress upon the government authorities (current and future, and at all levels) to restore access and integrity to public statistics, and re-establish institutional independence and integrity to the statistical organisations.
• The national and global reputation of India’s statistical bodies is at stake. More than that, statistical integrity is crucial for generating data that would feed into economic policy making and that would make for honest and democratic public discourse.

By providing quality information in the public domain, official statistics helps in measuring progress, analysing interplay of market forces, and in shedding light on business opportunities in the changing socio-economic, technological, and political environment.

The government owns the system to fulfil its commitment to produce statistics as a public good, make informed decisions in formulating policy, and evaluate performance.

As official statistics informs people about the state of progress of a country in various spheres, it has to follow a sound methodology and be authentic, dependable, trustworthy, transparent, and timely.

• In a democracy, a government is a contract between those who govern and those who are governed. Official statistics is expected to give concrete empirical evidence about governance.
• Governance, defined as the capacity of a country’s institutional matrix to implement and enforce public policies and to improve private sector coordination, affects the incentives of politicians, bureaucrats, and private economic agents alike and determines the terms of exchange among citizens and between them and government officials. (Ahrens 2002)
• Governance is independent of government. This separation expects a statistical system to be independent to provide impartial, verifiable empirical evidence on the quality of governance in its various dimensions.
• India is a vast country, united by collaborative federalism. The country inherited a stately history along with a fractured society. The country has seen great preachers of humanity along with worst forms of oppression that muzzled the voice of the poor and deprived.
• As Smith (2004) observed, “The impoverishment of India is a classic example of plunder-by-trade [emphasis in the original] backed by military might.” Freedom, and a democratic system of governance, provided people—for the first time—an opportunity to participate in socio-economic development and redeem themselves from centuries of subjugation and deprivation.
• Jawaharlal Nehru, the first Prime Minister of independent India, in his memorable speech on the eve of independence on 15 August 1947 said,
• Long years ago we made a tryst with destiny, and now the time comes when we shall redeem our pledge, not wholly, or in full measure, but very substantially …. We end today a period of misfortunes and India discovers herself again.
• The achievement we celebrate today is but a step, an opening of opportunity to the greater triumphs and achievements that await us.
• India has come a long way since then. But much more remains to be accomplished.
• Official statistics has discharged an important role in the country’s development effort by providing credible evidence about the state of development.
• The Indian statistical system is committed to continue providing, through professional quality data, an independent and impartial account of the country’s socio-economic progress. How can this cause be strengthened by a better system? That is the critical question.
• An appraisal of the present state of our system, to set the context, and suggestions for modernisation based on available options, form the contour of the paper.

The Indian Statistical System

• The system for official statistics in India as it exists today owes heavily to the great statistician Prasanta Chandra Mahalanobis (1893–1972) for its foundation. His birthday, 29 June, is celebrated as Statistics Day.
• The 125th birth anniversary of this great soul was celebrated on 29 June 2018. The Indian Statistical Institute, founded by Mahalanobis, is conducting a year-long programme to commemorate the anniversary.
• As honorary statistical adviser to the Cabinet, Government of India, Mahalanobis guided the process of laying a solid foundation for official statistics in the country. To him statistics was the “key technology.”
• This technology was considered a powerful means for not only scientific investigations but also for supporting the socio-economic development of the country, which was badly ravaged by colonial exploitation.
• The planning process, as part of the strategic objective of self-reliance, was conceived for the optimal use of resources for fast growth, as per the country’s priorities. This necessitated reliable data on various dimensions of the economy, which formed part of official statistics.
• Mahalanobis continued to nurture the development of official statistics as long as he lived. His contributions in the area of statistics are well-documented by Rudra (1996).
• The hallmark of excellence of PCM’s scientific work consists in the inseparable relation it represents between theory and application. He had an articulated philosophy of research in statistics. He believed statistics to be a Key Technology meant to help in the analysis of problems in the different sciences.
• All through his life, in all his research work, he remained true to this philosophy.
• The chapter in Rudra (1996) on the Indian statistical system records the creation of the two major wings of the present National Statistics Office—the National Sample Survey Organisation (NSSO) and the Central Statistical Organisation (CSO).
• No country, developed, underdeveloped, or over-developed, has such a wealth of information about its people as India has in respect to expenditure, savings, time lost through sickness, employment, unemployment, agricultural production, industrial production.
• We in this country, though accustomed to work in large-scale sample surveys were aghast at Mahalanobis’ plan for the national sample surveys of India.
• Their complexity and scope seemed beyond the bounds of possibility, if not beyond anyone else’s imagination, but they took hold and grew,” said Edward Deming (quoted in Rudra 1996), a renowned expert in sample survey methodology.
• The system developed for official statistics was then one of the best. India was among the earliest countries to adhere to international commitments on quality, comparability, and timeliness, such as the System of National Accounts (SNA), for estimating gross domestic product (GDP) in harmony with other systems on flow of funds, balance of payments, and fiscal statistics.
• This solid foundation helped it participate in the Special Data Dissemination Standard (SDDS) of the International Monetary Fund (IMF). These are positive aspects of the Indian statistical system, and provide methodological soundness for consistency and transparency, which are required for confidence in the data produced.
• However, the system required continual updating in keeping with the technological, organisational, methodological, and data-related issues and, when certain deficiencies became highly disturbing, it became necessary to review the system.

Rangarajan Commission

• The task of reviewing the system was entrusted on 19 January 2000 to a commission chaired by C Rangarajan, the then governor of Andhra Pradesh. The Rangarajan Commission submitted its report on 18 August 2001.
• The report examines the whole gamut of data quality, consistency, relevance, and timeliness of collected statistics, along with systems and processes for their administration, and is a major landmark.
• The Rangarajan Commission noted the shortcomings of the Indian statistical system and observed that its credibility, timeliness, and adequacy needed improving.
• The commission recommended that data gaps be identified and alternative techniques explored to improve the methodology of collecting, compiling, and disseminating data, and suggested reforming the administrative structure, grant it autonomy required for independence and upgrading infrastructure.
• As part of the implementation of the Rangarajan Commission’s recommendations, the National Statistical Commission (NSC) was set up in 2006. It was expected to be empowered to serve as a nodal body for all core statistical activities.
• This commission was to be backed by an act; it was drafted, but not enacted. Since 2006, the commission has considered many pressing issues confronting the generation of official statistics.

Areas of Weakness

• Several standing committees support the development of concepts and methods to maintain the quality of data collected—measurement of variables, survey sampling, updating the base of indices.
• Some of these are the Advisory Committee on National Accounts, the committees on prices and industrial production, and working groups on sample surveys. Whatever these committees did, became available in the public domain.
• Transparency remains a hallmark of the Indian statistical system but, despite these achievements, timeliness, quality, consistency, and coherence remain weak.
• It takes almost five years to revise the base period weighting diagram for price and production indices, whereas advanced economies produce chain-based indices for them, revising the weighting diagram every year. This is possible because systems are digitalised.
• Several attempts have been made in India to prepare an exhaustive register of business units to serve as a frame for drawing samples for various surveys. In a country where any business worth its salt requires to be registered, it is a pity that we cannot have a dependable business register.
• The data on business units collected through the economic census is not only expensive but also highly deficient.
• The Annual Survey of Industries (ASI) is an example of how a deficient frame contributes to erroneous estimates. The data on international trade based on customs and payments were also differing for different reasons.
• There is a wide variation between the consumption data based on the household surveys conducted by the NSSO and the estimates obtained through the national accounts. The present system is not equipped to reconcile the differences and look for solid evidence therein, which is needed.
• The estimation of gross state domestic product (GSDP) is a new, and more disturbing, issue thrown up by the latest revision in methodology for the current series of the GDP with base year 2011–12, which replaced the previous series with base year 2004–05.
• This has happened for several reasons; a major reason is the use of Ministry of Corporate Affairs (MCA 21) data on the corporate sector, which replaced the age-old ASI. The ASI data had various shortcomings, particularly under-coverage of the factory sector, and corporate-sector data were considered better for GDP estimation.
• The allocation for GSDP estimate for the year 2011–12, for the new series in respect of Gujarat was as high as 74.4%, to align the state’s estimates with those of the CSO, while the same for the GSDP estimate for the previous base of 2004–05 was only 30.0% (Dholakia and Pandya 2017). The allocation was as high as 100% for mining and quarrying, manufacturing, railways, and communications and services related to broadcasting and financial services.
• This has thoroughly disturbed the system developed painstakingly for estimating GSDP over many decades. It is particularly so for manufacturing, which should not be worked out by allocation.
• In a federal structure, where regional development is an important focus of development, the most important macro-parameter should be sufficiently credible.
• While pointing out major limitations of the revision carried out in the new series, Dholakia and Pandya (2017) observe that “most of these impacts are negative on the quality, reliability, valid usage, interpretation and meaningful analysis of long term trends of sectors and the economy at the state level in the country.”
• The story is similar for other states as well. New sources of data must be made use of. The goods and services tax (GST) system is capturing a lot of information on traded goods and services.
• An appropriate system must be developed for making use of these data for various estimates. Likewise, e-governance data need to be integrated more closely into official statistics.
• The Rangarajan Commission recommended that a data warehouse be built to consolidate fiscal data. The idea is to capture granular data for shedding much more light on the government effort on revenue generation and intervention for promoting socio-economic objectives.
• This will make available detailed information on government spending under various heads in any geography, district upwards, which could be related with other data for understanding the success of interventionist government policy.
• There is no such integrated system for fiscal statistics, though aggregated data are available under various heads for both the central and state governments.
• Even financial statistics, which is otherwise well-organised, needs to address emerging challenges on the distribution of financial assets and liabilities, and their sources and use, by geography, along with other characteristics, including riskiness and reasons thereof.
• Data on the regional distribution of some of the components of flow of funds are required on a quarterly basis to understand the nexus and dynamics of interactions between the real and financial sectors in shaping the course of the economy over space and time.
• This is because an enterprise is a product of opportunities, resources available, market conditions, and availability of risk capital. The success of government intervention for reducing imbalances in development and creation of jobs for demographic dividend can also be assessed when these data become available at lower levels of aggregation.
• Many areas of official statistics require improvement, and a major effort is needed to improve the legacy systems and processes that support the production of statistics and that are based on disparate conventional practices.
• The Indian statistical system was developed in the aftermath of independence to support development plans. The system improved over time, but the silos of decentralised systems created under the allocation of responsibilities to administrative ministries remained largely intact.
• More than one ministry collects and disseminates consumer price data. Now it is possible to meet user demand on agricultural, industrial, urban, rural and composite indices based on back-end compilation, and using the data repository on consumer prices and the corresponding weighting diagram for each type of index.
• In the past it was almost impossible to match unit-level data going into trade statistics compiled by the Directorate General of Commercial Intelligence and Statistics (DGCI&S) and the balance of payments (BoP) statistics produced by the Reserve Bank of India (RBI).
• Likewise, the establishment and enterprise approaches for the ASI and company finance data for manufacturing units were not amenable for mapping. Ideally we should have unit-level data on household production, consumption, and saving.
• While different sources provide these data at the aggregate level, it becomes difficult to compare them for regional distribution. Geocoded data for these three important household components would enable a better understanding of their inter-consistencies.
• It may be possible to examine household consumption expenditure for possible sources of divergence—households eating out but not reported in consumption surveys, midday meals supplied free of cost, and corporates providing their employees subsidised food.
• The GST data on sales at comparable regional levels could partially help. Digital payments data could be another source, though these data would not provide perfect mapping—except for some kind of dimensional checking.
• In short, data with comparable dimensional characteristics will allow for reconciliation of data available from alternative sources through a matching exercise by geography and institutional characteristics, and through a comparison of data from different sources that can be pulled using conformed dimensions in data warehousing parlance.
• It is relatively easy to reconcile differences in a smaller geography. Consider a few examples on comparability of data arising out of different sources.
• The data collected in the ASI details items manufactured, industrial classification, materials consumed, and location, but the MCA 21 focuses on financial performance in manufacturing units.
• As many large companies operate in multiple states, it is not possible to separately estimate statewise output. This is how the use of MCA 21 data in the new revision, instead of ASI data, led to very sizeable allocation of company output into different states.
• This problem can be greatly solved if the two sets of data are mapped through a common identity. The matching will not be perfect, but the census sector of the ASI will mostly be enterprises; hence, a major part of corporate manufacturing output can be identified to the respective geography.
• If no better alternative is available, allocation may be restricted to an unmatched portion. This will also relate two very important sets of data for various other analytical purposes.
• The NSSO is uniquely placed to conduct possibly the largest household survey. The NSSO uses professional, sophisticated, and statistically advanced methods to collect data from about 1,50,000 households.
• That is a large number of households but a tiny fraction of the 250 million households in India. Using the data to estimate household employment by state and occupation will reduce the number of households for each element.
• Even for the all-India estimate, there are some issues when it comes to sub-classifications. The NSSO estimate of urban population is significantly lower than the census figure. The standard error, even if low, does not help in the correction of such an estimate.
• One reason could be the deficiency in the urban frame of households the sample is drawn from. This deficiency leads to a major problem of consistency and validity as these estimates are used for value-added components for the unorganised sector.
• The Index of Industrial Production (IIP) is used to estimate quarterly GDP. The annual growth rate of value added by industry based on the IIP differs from the ASI rate, and when the quarterly estimate is derived using IIP it becomes deficient to this extent. The IIP is a measure of output, not of value added.
• Conceptually, the system for estimating national accounts follows three approaches based on production, income, and expenditure, which is useful for cross-checking consistency and coherence, in addition to other things. Many countries follow production and expenditure approaches for major components.
• Only a few countries follow all the three approaches because in these countries the income approach is also reliable. India follows the production approach predominantly. There are expenditure data on households, the government, and the corporate sector—the three major institutional sectors.
• However, the NSSO estimate of household expenditure differs widely from the CSO estimate, which is based on national accounting, and the difference is widening over time. There is no satisfactory way of verifying the various sources of this widening divergence.
• In big data parlance, production and expenditure data for the government, the corporate sector, and households under different heads at lower levels of aggregation, even if approximate, may allow for a way to cross-check each estimate for inter-consistency on dimension and direction of change.
• At present attempts are made to defend differences intellectually by arguing over possible sources of divergence. In some cases, one source is accepted as more credible than the other. Trade data is relied on to calculate exports although the RBI also collects payments data.
• As the RBI and the DGCI&S have much better systems now, it may be possible to undertake matching exercise periodically, at least on a sample basis.
• The Indian statistical system is highly decentralised. It has its own challenges. So far, some of the major concerns, which are legacy conventions, have been considered. Now, certain unconventional questions are raised on issues confronting official statistics.
• Do we understand the economy very well? It is about man and material resources, and their use over time and space; behavioural traits; market factors; impact on individuals and groups; opportunities and threats; policy prescriptions and their impacts; price formation; wins and losses; and the environment and its degradation.
• Do we understand poverty, inequality, and deprivation well enough to pursue policy to support vulnerable sections in a focused way and by geography? We need data to focus our programmes for success.
• To assess progress on the Sustainable Development Goals (SDGs) of the United Nations (UN), which span over 15 years up to 2030, India needs a system for collecting data on 17 major indicators and formulating plans and milestones.
• In a vast country of India’s size, non-linearities and heterogeneity cannot be wished away. India needs to use information and communications technology (ICT) to organise data for informing regional and subregional development.
• For an economy to function efficiently, it is necessary that authentic information about its functioning at each level is available in the public domain—that is, there is no information asymmetry.
• As pricing is a thermometer of market pressure, an understanding is necessary of how each market prices products and allows competition for efficiency and social welfare.
• Also, people need to be informed on how effectively government intervention is working to promote an environment conducive to growth, stability and equity, and how parliamentarians are performing to safeguard the welfare of the people.
• As enterprises use household savings for investment, risks thereon become a public concern. High-quality, dependable data at all levels of governance is needed to address these concerns.

Why We Failed to Overcome Known Shortcomings

• The Rangarajan Commission’s review of the Indian statistical system was a bold attempt to identify shortcomings and suggest appropriate action. In addition to methodological improvement, the commission wanted a major thrust on the use of modern technology for reporting; data processing, using data warehousing; and strengthening state statistical systems.
• There is no data warehouse yet for national accounting or large-scale sample surveys. When the world is using parallel processing in a cloud environment for processing voluminous data, India cannot fall behind any further.
• Procuring and deploying such a technology is a complex exercise. While solution providers can help with technology, there is the need to clearly spell out business requirements; source data; develop a methodology for collating data for estimation of parameters that adheres to accepted concepts and definitions; create classifications; and check for consistency, coherence, and timely dissemination as per policy.
• Conventional tabulations, spreadsheets, and traditional databases involve drudgery, and make for disjointed, relatively inflexible systems; adopting advanced technology will free us to do more worthy and stimulating work.
• The system needs to be more sensitive to public criticism. When the new GDP series was released, there was severe criticism, but remedies could not be made for want of appropriate data.
• If GDP estimates need to be tracted going into granular data and the method used for aggregation at different layers, there are few options, as inputs on these estimates are spread in such a way that verification is difficult.
• Data governance is another major issue. It includes laying down standards for maintenance of data, information technology (IT) architecture, and business continuity to ensure integrity and availability of these data.
• When spreadsheets are widely used to maintain data, it is not possible to impose rigorous data governance standards. The processes followed while processing data to check for consistency and coherence remain partial. It is not certain that estimates will withstand the test of inter-consistency and robustness. This is a major concern.

Our International Commitment on Quality Statistics

• In 2014 a UN resolution laid down 10 fundamental principles for official statistics. The first is official statistics provide an indispensable element of the information system of a democratic society, serving the government, the economy, and the public with data about the economic, demographic, social, and environmental situation.
• To this end, official statistics that meet the test of practical utility are to be compiled and made available on an impartial basis by official statistical agencies to honour citizens.
• The other fundamental principles relate to methods and procedures, scientific standards, proper interpretation, all sources of data, confidentiality, rules and regulations, coordination, use of international concepts, and cooperation.
• The 10 principles were notified by the Government of India through a gazette notification dated 15 June 2016 for adherence as part of our international commitment and also to improve data quality.
• It is necessary to put in place a system to review progress consistent with the commitments made. A code of practice for promoting the use of scientific methods and procedures for maintaining confidence in produced statistics is a major instrument for ensuring high quality, as will be explained later.
• The Indian statistical system can be proud of a variety of data on many dimensions of the economy, but systems and processes suffer from many legacy issues, particularly on absorption of technology.
• Many countries took up the challenge at the highest level because the pressure was very high to do so, as it was cutting at the roots of democracy.

What Are Our Options?

• There is a need for a comprehensive review of our official statistical system once again, not only to examine these major deficiencies but also to take advantage of new developments on explosive growth in digitisation of business operations and corresponding data sources along with technology, methodology, and user demand for data.
• There are countries that are moving away from well-established systems by undertaking a thorough revamping of their system. Apart from methodological and technological aspects, the organisational and administrative machinery also plays an important role, as recognised in the Rangarajan Commission report.
• If India had acted on some of the recommendations of the commission, the statistical system would have been in a much better state.
• An analysis of these recommendations should help to identify the weaknesses and courses of action to put the system on a sound footing. The major reason for advocating a thorough revamp of the Indian statistical system—“creative destruction” (Schumpeter 1976)—is not to criticise the well-established and time-tested systems existing now.
• These were developed when it was difficult and expensive to collect data and integrate them for multivariate distribution for analytical purposes. The technology and tools for processing and analysis of data were vastly different then.
• The systems, thus, remained disjointed. The main concern is that when we are going for changes, these are basically in bits and pieces. It is like an old Rolls-Royce, still roadworthy because of continual maintenance.
• However, maintenance has become costly and it does not pick up speed the way a new one will do. But we cannot abandon it unless we get a new one, which is tried and tested. This is where we need creative destruction.
• There have been major developments using advanced technology—geographical information systems (GIS); satellite remote sensing; broadband connectivity covering all gram panchayats; and GST for indirect taxes.
• Most government offices are digitalised and access to information online is widespread. How do we take advantage of these developments in building a system that allows for much more insight into the economy?

System of National Accounts

• The GDP is the single-most important barometer on the economy. Its compilation is guided by the SNA. The GDP covers all important parameters of economic statistics and is harmonised for consistency. In recognition of new possibilities in measuring GDP, the United Nations et al (2009) suggested:
• The sequence of accounts and balance sheets of the SNA could, in principle, be compiled at any level of aggregation, even that of an individual institutional unit.
• It might therefore appear desirable if the macroeconomic accounts for sectors or total economy could be obtained directly by aggregating corresponding data of individual units.
• There would be considerable analytical advantages in having micro-databases that are fully compatible with the corresponding macroeconomic accounts for sectors or the economy.
• Data in the form of aggregates, or averages, often conceal a great deal of useful information about changes occurring within populations to which they relate.
• However, a debate is going on over the importance of the GDP as a measure of the economy and over the analysis that assumes its central importance (Coyle 2014, 2016).
• In a review essay on her work, Syrquin (2016) agreed on one issue of particular relevance: “It may be correct, as argued in the book, that GDP has outlived its usefulness in the digital age.”

Micro–Macro Linkage Matters

• The two important factors contributing to strengthening an economy are productivity and competition. Both are much more relevant at micro levels. This does not mean that the macro level is not important. It is definitely useful for growth and stability.
• However, the quality of growth is equally important. Likewise, if tightening the economy for stability causes the small and marginal sections disproportionately higher suffering, a way must be found to protect them.
• Thus, macromodels and a calibrated approach may not be enough. Solow (2008) critiqued the stochastic general equilibrium model, stating that macromodels are made up of a single “representative agent.” There are many other issues (Barman 2016).
• This is where micro–macro linkages make eminent sense, though there will be challenges in analysing huge volumes of data. Porter (2002) said,
• Developing countries, again and again, are tripped up by microeconomic failures … countries can engineer spurts of growth through macroeconomic and financial reforms that bring floods of capital and cause the illusion of progress as construction cranes dot the skyline …
• Unless firms are fundamentally improving their operations and strategies and competition is moving to a higher level, however, growth will be snuffed out as jobs fail to materialise, wages stagnate, and returns to investment prove disappointing … India heads the list of low income countries with microeconomic capability that could be unlocked by microeconomic and political reforms.
• The other major issue is of poverty, inequality, and deprivation. Income inequality has worsened in the past 35 years; in 2016, the top 10% of earners cornered over half the country’s national income (World Inequality Lab 2018).
• In pursuing equilibrium for analytical elegance, glossing over basic issues of distribution and equity in a country where one-third of the world’s poor lives can lead only to peril.
• As Schelling (1978) pointed out, one’s search of equilibrium is meaningful when the dust is settled: “The body of a hanged man is in equilibrium when it finally stops swinging, but nobody is going to insist that the man is all right.”
• For India, the dust has not settled yet. In its tryst with destiny, the country needs to give vulnerable sections sufficient space to realise their potential.
• Should official statistics be burdened with these analytical issues? This can be debated. However, there must be a way to extract data to support various possibilities on analysis. There is a need for an integrated system populated with data of ultimate granularity and tools to extract relevant information flexibly.

Real Sector, Financial Sector, and Fiscal Sector Nexus

• In the analysis of an economy, the focus is on production, consumption, saving, investment, and exchange of goods and services. As a behavioural science, its concern is on explaining how society makes choices under conditions of scarcity of means of production, what enables growth and stability, and how the benefits are distributed. Reinert (2007) observed:
• Between the value of the raw material and that of the manufactured product lie much of employment, stable profits under increasing returns and much taxable income for the government.
• The benefits from manufacturing spread as “triple rents”:
•  to the entrepreneur in the form of profits;
•  to the employee in terms of employment; and
• through the government in terms of increased taxes.
• The framework for official statistics is detailed enough to provide data on these aspects, but these data are not well organised for access to microdata or for masking identity as required. The published data cater to user requirement following certain conventions.
• To understand the interplay of demand and supply, the domestic economy is divided into three sectors—real, financial, and fiscal. The real sector relates to production of goods and services; the financial sector relates to the flow of money-supporting transactions; and the fiscal sector relates to government revenue and expenditure.
• The issues relate to how market forces behave and respond to inducements, and how they approach equilibrium.
• To analyse performance, basic data is collected on these three sectors. There is also an external sector to complete the building blocks for analysis. As we have a reasonably good set of data on transactions forming part of the external sector, the focus here is on these three sectors only.
• How should data on the three sectors be organised, collected, compiled, and disseminated for analysis and for shedding light on behavioural dynamics?
• In the present system, microdata on entities are spread over many silos. There is limited data at the level of the village or village panchayat, the lowest tier of governance. We have 2,50,000 rural and urban bodies, and over three million government representatives as part of these institutions.
• The National Institution for Transforming India (NITI Aayog) has an aspirational objective to get data at this level to formulate credible plans at the village level and aggregate these progressively at higher levels, but new age IT is needed.

What New Age Information Technology Provides

• To take advantage of the new information age for official statistics, it will be necessary to seamlessly integrate conventional data collection methods with new government initiatives for capturing data digitally—direct benefit transfer, GST, tax collection, dispensation under other social benefit schemes, land record, land use, etc.
• Digitisation of payments is another exponentially growing area of data. Modernisation of systems for data on employment, health, education, etc, is on the anvil.
• How can capacity be built to integrate these data for shedding much better light on the economy and socio-economic development? It should also be possible to navigate the data repository or mine the data to pick up nuggets from the submerged mountains of data.
• Big data enables collection of audio, video, text, and digital data. These data may be structured, unstructured, or semi-structured. The concern now is mostly with structured data. Hence, the Statistical Data and Metadata eXchange (SDMX) has evolved as an internationally adopted method for data transfer for processing.

Statistical Data and Metadata eXchange

• The SDMX is a new-generation IT tool developed by the UN Statistics Division, along with other international agencies, for statistical reporting and sharing data and metadata following a common standard.
• The SDMX reduces delay in data transmission; uses less resources for processing at different levels; and improves the overall quality and timeliness of collected statistics. The taxonomy and classification for data elements, developed by user countries, can be customised for India’s purposes.
• Reporting under the MCA 21 uses the eXtensible Business Reporting Language (XBRL), which takes care of standardisation of concepts and definitions, nomenclature, classification, and hierarchical dimensions.
• Each individual item has a taxonomy and is assigned a unique computer-readable tag; precise, contextual description makes for seamless aggregation. The XBRL adheres to accounting principles for financial reporting.
• The same technology underlies the SDMX; the difference is due to its focus on statistical reporting. India needs a road map to implement the SDMX for the reporting and exchange of data.

Big Data and Data Warehouse

• As defined in the Oxford dictionary, big data is made up of “extremely large data sets that may be analysed computationally to reveal patterns, trends, and associations, especially relating to human behaviour and interactions.”
• Wikipedia defines big data as “a term for data sets that are so large or complex that traditional data processing application software is inadequate to deal with them.”
• Generally, big data originate in transactional data collected through data streaming—the way Google, Facebook, YouTube, and Amazon throw up data. However, these data are mostly unstructured.
• While these data can be useful for official statistics in certain circumstances and for certain purposes—like the spread of epidemics, volume of business, and the use of digital modes of payment—official statistics relies on data that are well-defined in terms of concepts, definitions, classification, representativeness, etc.
• The processing capability of big data technology is useful for integrating granular data, forming part of official statistics and their processing, taking advantage of parallel processing in clustered environments and analysis using advanced statistical and machine learning techniques.
• Official statistics builds out of huge amounts of microdata. Agriculture data—on land availability, land use, yield rate, area under irrigation, crops cultivated, cost of cultivation, farm gate price, wholesale price, consumer price, trade and transport margin, weather, and topography—are available in digitised form, by way of published, summarised tables, but are not well-integrated or geocoded. Researchers have to painstakingly cull these data from different sources.
• As these data are also pre-aggregated in tabular form, there is no flexibility to delve deeper into non-linearities, heterogeneity, or geography. These issues cannot be overlooked if agricultural productivity has to be examined in appropriate contexts.
• Also, data are required at much lower levels of aggregation than what is available now for evaluation of policy, monitoring of progress, and appropriate follow-up action needed to raise farms out of distress.
• Big data technology has the capability to pull out and process multivariate data of ultimate granularity stored in data lakes for much deeper insight on the issue being investigated, and for policy formulation and implementation.
• In the present illustrative example on agriculture, it is not only productivity and competitiveness that can be analysed in situational contexts but also the conditions of people engaged in agricultural labour; poverty levels; and malnutrition by age, gender, social group, and skills.
• This kind of analysis will be more purposive, relevant and penetrative, and shed much better light on human distress and possible remedies. This will not only support better, and more empirically based, decisions at all levels of governance—rather than a broad-brush approach, using aggregate data—but also better performance.
• A data warehouse is “a single, complete and consistent store of data obtained from a variety of different sources made available to end users in a way they can understand and use in a business context” (Devlin 1996).
• A data warehouse is generally subject-oriented, integrated, non-volatile, and time-stamped, which is accomplished by a data model organising data as facts along with dimensions as indexes for easy retrieval of these data as per user needs.
• The basic data elements are stored in the structure of a relational database management system (RDBMS) and then de-normalised using schema and populated in a multidimensional database (MDDB) server for quick retrieval.
• The idea is to fuse the two architectures of big data and data warehouse. There is also a need for metadata to explain the end-to-end life cycle of each data item used for different aggregates. This is the approach explained in Mohanty et al (2013).
• Its advantage is that it allows for the creation of a data repository, like a data lake, if advisable, for all data to flow into a central system or centrally connected systems. That may be a cloud-based cluster of servers from where a specific user can source data for storing in a data warehouse as per requirements.
• For example, the CSO may have a data warehouse for national accounting; line ministries can have their own data warehouse as per their requirements, drawing data from integrated system as a repository.
• Can we still have a single version of the truth? There is no easy answer to this question. Many iterations of carefully estimating various aggregates are needed over a long time, along with metadata mapping inputs with outputs, to find sources of differences and reconcile these.
• It will be a very complex exercise, and it may not always be feasible. Thus, a single version of the truth may not be easily achievable; however, much insight will be gained when our system can respond to such investigation because of virtualisation of data as part of an integrated repository.

What Kind of Technology?

• Big data technology has the capacity to handle huge volume of data, and appears very appropriate as a central system for official statistics for the country. The technology has been under development for the past decade and has now achieved maturity for adoption.
• The software for the system is largely open source, and the hardware is available like a commodity, which can be expanded at will to cater to increasing demand for storage and processing. The cluster of servers in a distributed cloud environment can support very high scalability.
• The data processed for official statistics are well defined in terms of concepts and definitions and need to meet high quality standards following sound methodology.
• Considering that the data originate from many sources spread throughout the country, sourcing data from decentralised systems following clearly defined measurement standards and integrating these can be a daunting task.
• There is a need for metadata that track the entire life cycle of data and for discipline on flow of data from these sources. The data can be administered through a system-driven process for timeliness and quality check.
• Considering the huge task at each stage, quality checks can be greatly process-driven. This system needs to work under professional supervision for both on-time and penetrative analysis regarding quality, consistency, and coherence of collected data. The outliers thrown up by the system or the missing data need to be attended to promptly.
• Considering the challenges in data collection and processing and in the management of operations, a modern data warehouse with big data technology is needed for the central system.
• This can be connected with all the other systems that form part of the national statistical system for two-way flow of data and processing. The requirements would be defined by users—data producers in central and state government ministries and coordinating offices.
• The details of such arrangements, supporting technology, and integration standards have to be worked out. The broad approach for data flow for the same is shown in Figure 1. It should be noted that this is only an illustration, not a prescription. Help is required from experts to work out appropriate technological solutions.
• The data can be captured by various means—surveys, census, web-based reporting, administrative records, automated systems for periodic sourcing from feeder systems, satellite images, Facebook, external open sources, and so on.
• Then, according to predefined concepts, the data are filtered and processed for extraction, transformation, and loading, and validation checks imposed to ensure quality. Complex event processing engines may include spatial engines.
• These data then move to the spatial big data warehouse. The spatial element is expected to take care of geography right from the village level, wherever applicable. The user interface is a facility to take control of entire operation according to specific
  user needs.
• Data warehouses can be used for predefined and ad hoc tabulations. Requirements for data tabulation are set by the SNA along with other harmonised systems for flow of funds, balance of payments, input–output tables, etc.
• These data are produced by different organisations and the processing systems are also different. Each state is responsible for estimating the state domestic product. Other line departments are responsible for production of data falling under their ambit.
• While this will continue to be so for a long time, it will be desirable to make provisions for certain checks as required for consistency. The harmonised system of official statistics expects this for quality and coherence of these data.

Dashboard and Data Visualisation

• At present, data production and dissemination for official statistics follow a predefined set pattern. While this is the primary responsibility of the national statistical system, each line ministry has a set-up to produce data specific to the needs of users.
• There are also ad hoc queries, which can be analysed for discovering regularity in those needs. These requirements can be systematised by developing dashboards.
• A dashboard is defined as an information management tool made available to users as a canned report containing data and visual graphics on key performance areas, which help in monitoring progress and evaluating performance on set objectives.
• The dashboard is easy to read and the visual is usually revealing. An intelligent dashboard can also be designed to be interactive and support further requirements for review and analysis.
• The dashboard culture is widely prevalent in professional organisations. Bloomberg is a classic example of intelligent dashboards feeding data on how global markets move, economies perform, rates change, and even opinions differ every day.
• Some of the information contained in such intelligent content can be important sources of external data for authorised users, subject to terms of agreement. The availability
  of these data can enhance the usefulness of information systems that look continuously for signals that may have policy implications.
• The Indian official statistical system has emerged out of the planned era. In the predominantly market-led economy, the requirement is varied and covers a much broader canvas.
• Price signals, forward trades, and international trade are but a few examples of demand for information in the present globalised world. It is necessary to work out how far an official statistical system can move to accommodate user requirements where external sources of data would be required.
• Official statistics is a public good; hence, data from other countries can be collected from their official sources as admissible. However, data from non-official sources may lack quality and credibility, and need to be evaluated against quality standards.

Data Quality and Code of Practice

• Official statistics needs to be compiled following standards laid down for concepts and definitions; data collection and aggregation methodology; a data dissemination policy as per our commitment; and a publicly disclosed policy on transparency to maintain high confidence.
• The Rangarajan Commission specified quality assurance standards. Our commitment on quality—as set out on 15 June 2016, and consistent with the UN resolution of 2014—stipulates certain core principles: impartiality, objectivity, integrity, sound methods, confidentiality, accessibility, accuracy, reliability, coherence, and clarity.
• A system of statistical audit is prescribed for ensuring these quality standards. Stringent data quality conditions are stipulated in the code of practice in many countries. For high-quality data, systems and processes need to be upgraded and modernised; resources strengthened; and feedback solicited from users periodically.

The Rangarajan Commission found that

• At the moment, as the system operates, there is no effective coordination either horizontally among the different departments at the Centre or vertically between the Centre and the States …
• For reform of administration of the Indian Statistical System by upgrading its infrastructure and thereby enhancing the credibility of official statistics, the Commission is of the view that an independent statistical authority free from political interference having power to set priorities with respect to Core Statistics is needed to ensure quality standards of statistical processes.
• Such an authority will also improve the coordination among different agencies collecting data. Though the National Advisory Board on Statistics was constituted with this objective, its impact has been minimal.
• In view of this, the Commission has recommended the creation of a permanent and statutory apex body—National Commission on Statistics [sic]—through an Act of Parliament, independent of the Government in respect of policy making, coordination, and maintaining quality standards of Core Statistics.
• Though the Rangarajan Commission was appointed by the Vajpayee government, and its report was implemented by the next government, some vital recommendations have not been acted upon.
• The NSC needed the backing of an act for effectiveness. Without it, the NSC remained largely handicapped. The NSC came out with many more reports, but these were not acted upon. Without accountability on implementation of well-thought-out decisions, it effectively remains helpless.
• As the NSC functions with part-time members and a small contingent of staff, it has not been effective in carrying forward its mandate. This is further weakened by its complete dependence on the ministry for administrative and financial matters, which creates various frictions.
• A way to ensure genuine independence must be found.

Learning from the United Kingdom

• The commission approach at the apex of the statistical system does not work well. Such a system in the United Kingdom (UK) was replaced by the UK Statistics Authority (UKSA), which is a board backed by the Statistics and Registration Service Act, 2007, and is directly responsible to parliament through the Ministry of Cabinet Affairs.
• A highly professional membership and robust systems and processes has made a major difference. The UKSA system ensures high standards of transparency and professionalism and makes executives responsible.
• For production of official statistics to be independent, the entire machinery must work at arm’s length from ministerial control.
• The UKSA has oversight of the Office for National Statistics (ONS), a non-ministerial government department. The UKSA is also responsible for independent monitoring and assessment of official statistics; maintaining a code of practice for official statistics; and according code-compliant statistics as “national statistics.”
• The chief executive of the ONS is the National Statistician and is directly accountable to parliament through the UKSA. The ONS started the first phase of modernisation in 2001. Its experience is well documented in Penneck (2009):
• Pressure to operate more efficiently, respond more rapidly to changing user demands, exploit data more effectively and improve statistical quality have led a number of statistics offices to seek to modernise their statistical systems in similar ways: adopting an information technological environment, using standard tools, and processes across statistical systems, with common business processes driven by metadata.
• “Together the Design Authority and IT strategy provide clear direction for modernisation” for delivering “high quality and noticeable business benefits.” This should be the most important learning point for India.
• The ONS is now going through the second phase of modernisation. Charles Bean (2016) Committee Report sets the agenda for this phase of reform, which is challenging organisationally, methodologically, and technologically. The report notes how the methodology focusing on GDP is deficient in many respects.
• The UK went about this reform as a part of its election manifesto. Parliament was fully involved in the discussion on systems, checks, and balances. This was in the making for a long time. Jack Straw, a prominent member of parliament and minister (until 2014) told the Royal Statistical Society in 1995:
• Democracy is about conceding power to those with whom you disagree; not those with whom you agree; and about ensuring that every citizen has a similar access to the information on which decisions are made, and governments are judged. In a modern democracy, the system of official statistics should be a dignified part of the constitution.
• Independence and authority for official statistics have been fortified in many other countries in the West by enactment and establishment of a statistical authority. Such an authority is free of any kind of extraneous influence and it is vested with the power to produce high-quality statistics.
• The European Union has prescribed a code of practice that member countries follow. India must follow similar organisation, systems, and processes to revamp its statistical system.

Action Points

• India needs an exhaustive list of data going into estimation of GDP, and for financial and fiscal statistics, with clear definition, classification, and sources for each item. The list may run over 3,000 items, expected to be available with the CSO.
• A system is needed to capture data from various sources. Milestones for web-based reporting may be defined following reporting standards such as SDMX or XBRL. India needs to build capacity for processing voluminous data using modern big data and data warehousing technology.
• It is desirable to have a design authority to lay down standards on technology for integration, high value on low cost, and use of standard tools so that local development is avoided.
• India needs to develop capacity for using advanced techniques for survey sampling; measurement of variables as contained in the SNA and other manuals; and undertake experimentation for discovery of patterns and dependencies using techniques of multilevel analysis, machine learning, and artificial intelligence.
• The time has come for statisticians to acquire advanced knowledge in software and domain knowledge of subject area of analysis and graduate as data scientists.
• Last but not the least is an act, to make the system really independent. Official statistics is a public good, and an important part of the democratic process. An act that provides for the creation of an independent, professional authority that can raise the quality of data and confidence in the system, will make a major difference.

Conclusions

• Official statistics is an important part of the democratic process: it informs people how the economy is progressing; how interventionist government policy helps in maintaining stability conducive to growth and advances the cause of social development, particularly in respect of vulnerable sections of the people; and how private enterprises work in a market economy.
• These data should be available from the local level and upwards to support more efficient use of resources and more responsive governance in all walks of life. The data should withstand rigorous scientific scrutiny and be made available to users as a public good.
• New techniques are needed in the social sciences to analyse the complexities of socio-economic dynamics. A prerequisite is the availability of granular data and tools for their access as per analytical needs.
• A spatial big data warehouse, which can capture the entire life cycle of data going into estimates at different levels of geography, is expected to serve as the backbone of analytics and give a new direction on research backed by solid empirical evidence. The flow chart is only an illustration, not a prescription.
• We do not suggest any specific tool. The widespread use of artificial intelligence, along with massively parallel processing in cloud environments, should lead to new breakthroughs. The prerequisite for this is relevant data extracted from various sources for such analysis.
• A new breed of researchers and data scientists with statistics and machine learning expertise, who understand business objectives and are good at handling huge volumes of data, will find interesting patterns.
• Tobler’s first law of geography is, “Everything is related to everything else, but near things are more related than distant things.” There is the option of multilevel analysis as a powerful statistical tool for a layered approach to data analysis.
• In the process our long-standing ideas based on too much of abstraction will come under scrutiny and pave the way for deeper insight on development issues. It will help in creating a new vista in our development effort in the present millennium.

Here is the most expensive infrastructure project of the country, with a record high unit cost of ₹ 1,200 crore per kilometre (km), but no functionality beyond electoral rhetoric. Whether this corridor can “decongest” the city roads is a black box given that the proposal of this project is not based on any extensive transport survey.

• If decongesting road traffic is the real intention, then why not first expedite the completion of the metro rail work across the city? The coastal road cannot be considered a silver bullet for the city’s infrastructural issues, which are not only varied but often mutually exclusive.For instance, if citizens must benefit from easy connectivity via the coastal roads, they must endure the degradation of their city’s inter-tidal ecology almost as a natural corollary.
• These hard choices, however, cannot be explained away simply as dilemmas of development. Evidences of coastal development in this country over the past two decades, and particularly in the last five years, indicate that such trade-offs are the result of an emerging partisan politics of welfare, which is characterised by a brazen display of corporate clientelism.
• From Gujarat to Kerala, vast stretches of the coastal lands are under corporate control through the state-abetted circumvention of regulations, especially in the name of special economic zone (SEZ), and the coastal regulation zone (crz) or the coastal management zone (CMZ) schemes.
• On the one hand, this encroachment has ousted traditional fishing communities from their ancestral lands, while on the other, a number of extractive industrial and construction activities in these zones are jeopardising their conventional livelihood.
• Simultaneously, it is hard to dismiss how the government policies, camouflaged by the rhetoric of “blue economy,” have “de-commonised” the sea and displaced the traditional (local) institutions of fisheries management.
• With the corporate-friendly policies framing the seas and the coasts as the new frontiers of economic opportunity and growth, private takeover of the marine resources is progressively squeezing out traditional fisherfolk from their native fishing grounds.
• Yet, be it the CMZ or the SagarMala, all schemes of the current government having to do with the fishery sector either make cursory or rhetorical references to the “blue economy.”
• Neither do these schemes or policy documents provide any comprehensive guidelines for the promised breakthrough, nor do they recognise the inherent heterogenity of the sector, for in doing so the government will have to face disconcerting questions on the eviction of the original inhabitants of the land in the name of “development.”
• In such a context, “rehabilitation” can gag those voices of concern that hold the government accountable for its failure to ensure the fundamental rights of its citizens.

The men are on death row for more than a decade, living solitary, tortured, and pitiable lives in jails. One of them turns out to have been a minor when the offence allegedly took place, but no heed is paid to that by any of the courts. When three of them find their death sentences commuted by the Bombay High Court, the Supreme Court overturns such commutation and awards the death penalty without hearing them at all. The ­Supreme Court then dismisses their review petitions without an open court hearing.

• It was only when the curative petition in the Supreme Court was placed before a totally different bench and the “error” was discovered that the wheels of justice finally began to turn.
• This case provides ample justification for the rule introduced by the Supreme Court that review petitions in death penalty cases must be heard in open court to bring in transparency to the ­process.
• In the end, the Supreme Court has acquitted all the ­accused, directed the state of Maharashtra to pay compensation to them, and attempted to hold the police accountable for this callous lapse. What it has not done is offer any sort of mea culpa for its own failings in this case.
• While the Supreme Court is fond of justifying the death penalty on the grounds that it must be applied only in the “rarest of rare cases” and after carefully weighing all mitigating and ­aggravating factors in a case, in reality it has been happy to discard the law at the drop of a hat. The judgment awarding the death penalty to the convicts in the “Nirbhaya” case, for example, is long on impassioned rhetoric and short on the law when it comes to awarding the death penalty.
• The very same bench that overturned the death penalty in the Ankush Shinde case also awarded the death penalty in another case on the same day, in a judgment that is empty of any analysis or reasoning on why the death penalty was merited in the matter (Khushwinder Singh v State of Punjab).
• To be fair to the Supreme Court, while it has commuted ­almost all death penalties in the recent past (11 out of 12 in 2018, for instance), the trial courts on the other hand seem to be more perversely enthusiastic about death penalties than ever.
• As the report by National Law University, Delhi on the annual statistics for the death penalty shows, 2018 paradoxically also saw the highest number of death penalties awarded by the trial courts since 2000. If the quality of the investigation, trials, and the judgments in the Ankush Shinde case are anything to go by, it is safe to assume that a large number of such death penalties have been awarded by the courts in cases with grievously faulty trials.
• And, yet, this hardly seems to inform bloodthirsty calls in the public for increasing the imposition of death penalty by the courts.
• Politicians of all stripes are happy to accede to these ­demands, which are ignorant or unconcerned about the ­vagaries of a broken criminal justice system that only ends up crea­ting more victims than punishing any hardened criminals. The courts at the lower level seem happy to go along with the popular mood, imposing the death penalty liberally despite the evident failings in the prosecution’s case or the ability of the ­defen­dant to mount a proper defence.
• It is then up to the appe­llate courts to try and remedy the injustice, but, as the Shinde case shows, they too are fallible. Even when they are eventually acquitted or find their death penalty commuted, the torment suffered by convicts as a result of the endless delays and flawed decision-making in a broken criminal justice system is rarely remedied.
• With the criminal justice system being what it is, it is hard to see the death penalty as anything but an institutionalised form of murder, one that unerringly chooses its victims from the ­oppressed and disenfranchised sections of society. With the political leadership unwilling to do the morally right thing, we can only hope that the Supreme Court will finally awaken to the reality of the situation and put in place an immediate moratorium on the death penalty.

We should not fail to recognise the fact that although most teachers, especially English teachers, in Karnataka have ­become public figures by virtue of their writings in Kannada, they have always exercised tremendous influence on generations of students who cherish their classroom experiences under their teachers.

The media and the public too often overlook the teaching careers of such personalities and valorise their writing selves.

• What interests me in Giraddi is his extraordinary career as a scholar–teacher. He began his teaching career in a small village called Hanumanamatti near Ranebennur in 1963 and, then, went on to teach at Karnatak College, Dharwad.
• This was when Giraddi was initiated into the rich tradition of scholar–teachers that was flourishing in the Dharwad of those days. D R Bendre, the great poet, used to be addressed as “Bendre master.”
• In Dharwad, Giraddi’s literary sensibilities took shape under the tutelage of V K Gokak, another prominent Dharwad intellectual. Giraddi, along with Champa (Chandrashekhar Patil) and Siddalinga Pattanashetty, who are also scholar–teachers and writers, comprised the trio that brought out Sankramana, a leading literary magazine of the time.
• It was the literary activities at Dharwad that contributed immensely to the making of the teacher in Giraddi. While Giraddi in his teaching borrowed heavily from Dharwad’s literary culture, he could also contribute to it considerably drawing from his teaching experience.
• When Karnatak University set up a postgraduate centre in Gulbarga, Giraddi became a university teacher at the ­centre, where, as he used to recall, his leisurely job and the unchallenging students in class gave him ample opportunities in the evenings to engage himself with ­theatrical activities.
• What he taught in his classroom—say, for example, plays—he could practise in the evenings along with amateur theatre participants. Giraddi, thus, was one of those rare teachers who utilised the opportunities provided by his teaching career to cultivate the writer in him.
• Giraddi’s literary engagement with Kannada would not have been possible without his expertise as an academic in English studies, although he did not produce any significant writings in English. Some of his “pure-English” colleagues criticised him for having betrayed the discipline by not writing in English.
• As far as my knowledge goes, ­Giraddi was capable of extraordinary work in English, at least on par with his contemporaries. But, he, like several academics of his generation, made a conscious decision of writing in the bhasha.
• I remember him once telling me that English departments in India should serve the purpose of our local cultures; in Karnataka, for example, they should work for the enunciation of Kannada life.
• This often resulted in his colleague M K Naik, one of the leading proponents of Indian English literature, having differences with him.
• Though ­Giraddi was trained in linguistics at the Central Institute of English and Foreign Languages (CIEFL; now English and Foreign Languages University), Hyderabad, and completed his master’s in linguistics from Lancaster University, United Kingdom, he chose to work for Kannada. Otherwise, he could have settled down at one of the premier institutions elsewhere.
• When I went to do my master’s in English at Karnatak ­University in the late 1990s, I was surprised to find Giraddi the chairman of the English department. I, like several friends of mine, had thought that he was a professor of ­Kannada literature as we had read his short stories in Kannada before going to university.
• That indeed was the beginning of our literary education. But, it was intriguing that ­Giraddi never revealed to us his identity as a Kannada writer in class. He hardly cited examples from Kannada literary texts, nor did he share his experiences of interacting with great Kannada writers. This left many of us disappointed.
• I still find it puzzling why Giraddi kept his engagement with Kannada literature, his most sought-after passion, away from his classroom teaching. I now believe that it is an ­extremely important obligation of English teachers in India to forge their bilingual and bi-literary sensibilities.
• Some of my classmates who had introduced me to Kannada literature were quite upset when Giraddi did not mention anything about the writer and polymath K Shivarama Karanth when he passed away in 1997.
• On that day of gloom in our class, we were eagerly waiting for Giraddi to talk about his experience with Karanth and his writings. But, to our dismay, he went on with linguistic analysis as if all was well in the ­Kannada literary world.
• Giraddi, who was in the news recently for proposing the golden mean, the madhyama maarga (middle path), was a dvaiti (dualist) as far as the use of language was concerned. He spoke only in English in our classes; never did his Kannada interfere with his “English-medium” teaching.
• However, when he spoke in public, he used Kannada as if he did not know English. This was completely at odds with his intellectual conviction of working for the local culture. Sometimes, it is difficult to understand the ways of the people we admire.
• Probably, he did not want to show off his scholarly achievements and, obviously, he was never pretentious about his ­intellectual life. I remember having read about Immanuel Kant maintaining such a disciplined separation; he never talked about philosophy outside his academic interactions. A rare thing to observe in philosophers!
• Giraddi was very dry and monotonous when he taught ­linguistics, but was quite lively when teaching British modernist literature. Our generation of students will never forget the way he taught us T S Eliot and W B Yeats.
• Probably, Eliot was his favourite poet. He taught us Eliot, especially The Waste Land, for half a year. I remember one of my seniors saying that Giraddi would make The Waste Land dance before us.
• It was such an unforgettable experience for us as students that we started saying that “Giraddi Sir is not a Professor of English, but a Professor of T S Eliot.” Of course, Eliot was such an influence on Giraddi that, due to his teaching, Eliot became the favourite of many generations of his students.
• He also drew our attention to the extraordinary merit of Eliot’s prose, not to mention the pleasure and profit one derives from reading it. Thanks to his suggestion, I now take refuge in Eliot’s prose whenever I am feeling low. We could not have discovered the poet in Eliot’s prose, but for Giraddi.
• His teaching of Eliot not only shaped us, but also shaped Giraddi, the critic. I would see him go over to meet G S Amur, the writer and professor of literature whom he admired as his guru, only to learn from his conversations with him.
• The learner never ceased to exist in Giraddi, and he taught us that to be a teacher is to be a learner forever. During our student days, he was at the fag end of his career, retiring when we graduated. But, he was never tired of engaging classes even during his retirement period.
• He used to prepare for classes as if he were doing it for the first time. When he assumed office as chairman of the Karnataka Sahitya Akademi, he would come down from Bengaluru during the weekends to complete his portions of the syllabus enthusiastically.
• As a writer, he inspires us even today to work for Kannada and, as a teacher, he inspires us to love teaching amidst the challenges posed by the resistance to learning. Our challenge is to cultivate literary sensibilities in the age of social media.
• His scholarly teaching showed us that to be a teacher is to lead the life of a scholar, for the teacher cannot come into ­being without the scholar.

This paper analyses the potential benefits of the price deficiency payments system vis-à-vis the existing MSP policy for selected crops such as rice, wheat, gram, tur (arhar) and cotton, and looks at the challenges involved in implementing the proposed system.

It also examines whether price deficiency payments will work better than the existing MSP policy to improve farm productivity and incomes, as well as help reduce the farm subsidy bill of the government. The paper is based mainly on the analysis of secondary data and review of relevant literatures.

Why Price Deficiency Payments?

• The case for price deficiency payments to farmers is made out on the ground that the existing MSP policy, which is being followed in India since 1965 for various agricultural commodities, is highly inadequate and ineffective from a farmer’s perspective and also inefficient from an economic point of view.
• First, the costs of production vary widely from region to region and the existing methodology of fixing MSPs, based on all India weighted average costs, does not necessarily guarantee remunerative prices to all farmers in all regions.
• Second, the farmers in general are unhappy with the MSP programme because the input costs in crop production have recently gone up at a faster pace than the MSPs.
• From 2004–05 to 2014–15, the average annual growth rate of C2 cost of production of paddy was 11.2% in Bihar and 11.9% in West Bengal, while the MSP of paddy increased only at the rate of 10.6% per year.
• Third, MSPs are to some extent effectively implemented only in Punjab, Haryana and Madhya Pradesh for wheat and Andhra Pradesh, Chhattisgarh, Punjab and Haryana for rice. The farmers in other states hardly benefit from MSPs as there is either a very small or no presence of government procurement agencies.
• The 70th round of National Sample Survey for 2012–13 reveals that only 32.2% of paddy farmers and 39.2% of wheat farmers in the country were aware of the MSP, while only 13.5% of paddy farmers and 16.2% of wheat farmers sold their produce to government procurement agencies (GOI 2014).
• The main reason cited for not selling to these agencies was their non-availability at the local level.
• In the case of commercial crops like cotton and jute, the Cotton Corporation of India (CCI) and Jute Corporation of India respectively intervene only when the market prices fall substantially below the MSPs. There is no effective procurement policy for coarse cereals, pulses and oil seeds.
• Also, the fair and remunerative price fixed for sugar cane generally comes in conflict with state-advised prices and is rarely implemented. Under these circumstances, a majority of the farmers in the country do not really benefit from the MSPs.
• At the same time, the MSP policy has been under attack recently by several economists. It is argued that this policy destroys the power to harness the market potential and kills efficiency (Chand 2013). Chand further argues that
• it is not feasible for public agencies to procure the marketed surplus of each and every commodity everywhere in the country to prevent prices falling below a floor level; nor would this be desirable … So, new mechanisms have to be devised to protect producers against the price falling below the threshold level. (Chand 2012)
• There are other economists who criticise the MSP policy because of its adverse impact on the gross domestic product and food price inflation (Parikh et al 2003; Bhattacharya and Sengupta 2015).
• Moreover, the union government, especially the Ministry of Finance, is worried that higher MSPs of rice and wheat, offered in the recent past, have increased the food subsidy bill. The food subsidy bill increased from ₹72,370.90 crore in 2011–12 to ₹1,05,509.41 crore in 2015–16 (GOI 2016).
• In addition, the increase in MSPs in recent years, resulting in huge procurement and public stock holding of grains, has attracted the attention of the World Trade Organization (WTO), requiring India to find a permanent solution on a best endeavour basis.
• The agricultural trade rules as outlined in the WTO Agreement on Agriculture (AoA) do not bar public stockholding programmes in developing countries for food security purposes. However, if food is procured at administered prices and not at market prices, then this is deemed support to farmers, and this cannot exceed the limit of 10% of the value of the production in question.
• Therefore, it is not surprising that the policymakers in India are trying to find an alternative mechanism, which would keep the quantum of the subsidy in check and also meet the restrictions on the subsidy imposed by the WTO.
• The main objective of the intended policy shift is to improve farmers’ incomes as well as reduce farm subsidies (GOI 2015a), whereas the objective of the MSP policy is to incentivise farmers to produce more and earn more without caring for subsidy management.

Modus Operandi for Price Deficiency Payments

• The effectiveness of price deficiency payments in either helping the government to reduce its agricultural subsidy bill or improving and stabilising farm incomes will depend on how the programme is conceptualised and operationalised.
• Although, the government has not yet clearly decided the face of the programme, one can refer to several alternative frameworks. Also, one can develop a mechanism based on the experiences of the United States (US) with countercyclical payments or Price Loss Coverage (PLC) schemes in the last several years.
• The first alternative we put forth is that price deficiency payments be based on the difference between the MSPs and farm harvest prices (FHPs).
• The government may continue to fix MSPs for 23 agricultural commodities and provide deficiency payments to farmers for all such commodities whenever the FHPs rule below the MSPs, without purchasing any quantity of the covered crops or purchasing only a limited quantity of any important crop.
• The Ramesh Chand Committee (GOI 2015b) suggested that mechanisms such as deficiency price payment or price insurance should be put in place for price surety for all the crops for which MSP is declared. This is because the MSP cannot be implemented everywhere for all crops through a system of procurement.
• The second alternative suggested is that deficiency payments should be based on the difference between the average of FHPs of the preceding three years and the fourth year price. The NITI Aayog occasional paper proposes that, under the system of price deficiency payment,
• the government would announce a floor price for each crop. This floor may be the average of the market price in the preceding three or four years. Each farmer would register his/her crop and acreage sown with the nearest APMC [agricultural produce market committee] mandi.
• If the market price falls below the floor price, the farmer would be entitled to the difference up to a maximum of, say, 10% of the assumed price that could be paid via direct benefit transfer into an Aadhaar-linked bank account. (GOI 2015a)
• Let us analyse the potential gains and drawbacks of both these propositions.
• Alternative 1: The first proposition involves basing deficiency payments on the difference between the MSPs and FHPs.
  Considering the country as a whole, the average FHPs and MSPs of paddy increased at the rate of 7.84% and 7.77% respectively during the period 1998–99 to 2014–15.
• It may be seen from Tables 1a and 1b (p 54) that the FHPs of paddy were marginally above the MSPs in 13 out of 17 years (1998–99 to 2014–15). From 2010–11 to 2014–15, the average FHP was lower than the MSP only once in 2011–12.
• In fact, the average FHP in the country from 2010–11 to 2014–15 was ₹1,296 per quintal against the average MSP of ₹1,200 per quintal. In such a case, the government does not have to make deficiency payments to farmers.
• But a difference of ₹27 per quintal in 2011–12 would have translated into a cost of ₹4,313 crore for the government based on total production, and ₹3,765 crore based on marketed surplus of paddy.
• In the case of wheat, the FHPs were higher than MSPs in most of the years during the period 1998–99 to 2014–15.
  Figures 1a, 1b, 2a and 2b show the movements of average FHPs and MSPs of paddy (rice) and wheat.
• From 2010–11 to 2014–15, the average of FHPs of wheat was ₹1,324 against the average MSP of ₹1,331. In 2011–12, however, the FHP was lower by ₹126 per quintal in which case the government would have to incur ₹11,529 crore as deficiency payment to farmers.
• If we add the differential value of ₹4,313 crore for paddy production in that year, the total amount for rice and wheat would be ₹15,842 crore based on production figure, and ₹13,818 crore based on marketed surplus.
• In comparison to this, the government’s food subsidy bill due to procurement, distribution and storage of rice and wheat and the gap between their economic costs and the central issue prices worked out to ₹84,553.13 crore per year from 2010–11 to 2014–15. In 2011–12, the food subsidy bill was ₹72,370.90 crore, and in 2015–16 it was ₹1,05,509.41 crore (GOI 2016).
• Thus, the government would make a huge saving by switching to the price deficiency payment system and the farmers would get no less than the MSPs anywhere in the country.
• If the government pays only 10% of the price deficiency to farmers, the amount of average subsidy paid would be even lesser. The challenges involved in the implementation of price deficiency payments could be less in comparison to MSPs as it is not linked to procurement and distribution.
• However, the crops for which MSP has only a notional value, as it is hardly defended even if the FHPs fall below the MSP, tell a different story. In the case of tur (arhar), from 1998–99 to 2014–15, the average of FHPs remained much higher than the MSPs in 14 out of 17 years with huge differences .
• From 2010–11 to 2014–15, the average FHP of tur was ₹3,849 per quintal as against the MSP of ₹3,490 per quintal. In 2011–12, the FHP, however, was as low as ₹3,169 per quintal against the MSP of ₹3,700 per quintal, that is, a difference of ₹531 per quintal.
• In this case, for a production of ₹2.65 million tonne, the government would need to pay ₹1,407.15 crore to the tur growers as deficiency payment. This would amount to ₹1,146.96 crore for the tur sold.
• In reality, the government paid nothing to the farmers; therefore, deficiency payments would mean a net loss of revenue for the government and a gain for the farmers.
• Similarly, in the case of gram, another important pulse crop, the average of FHPs in the country was higher than the MSPs in 14 out of 17 years (1998–99 to 2014–15). Figures 2a and 2b show the temporal variations in average FHPs of tur (arhar) and gram.
• From 2010–11 to 2014–15, the average of FHPs of gram was ₹3,070 against the average MSP of ₹2,835 per quintal. In 2013–14, the average of FHPs of gram in the country was ₹3,049 against the MSP of ₹3,100, that is, less by ₹51 per quintal.
• If the government had to make deficiency payments to the farmers growing gram, the required amount would be about ₹486.03 crore based on production, and ₹407 crore based on marketed surplus of gram in that year. Since gram is not procured by the government, this would be a net revenue loss for the government and net gain for the farmers.
• In the case of cotton, a commercial crop for which there is now an attempt to pilot the system of price deficiency payment, the average of FHPs remained lower than the MSPs in 10 out of 14 years (2001–02 to 2014–15) (Figure 3, Tables 1a, 1b).
• The year-to-year movement of FHP and MSP of cotton is shown in Figure 3. Since, the FHP of cotton was generally lower than the MSP in most of the years, the deficiency payment would hugely benefit the farmers and cause a revenue loss to the government.
• In 2012–13, when the price differential was as much as ₹324 per quintal, the CCI purchased only 392 thousand tonnes of cotton at MSPs out of 34.2 million tonnes of total production.
• The marketed surplus constituted nearly 99% to 100% in the case of cotton; therefore, the MSPs covered only a fraction of the total quantity marketed and the farmers did not benefit much from the MSPs.
• Also, the cotton procurement by the CCI was concentrated mainly in Andhra Pradesh and to a small extent in Maharashtra, Odisha, Rajasthan, Punjab and Karnataka. The cotton farmers in Tamil Nadu, Gujarat and Madhya Pradesh did not benefit much from the cotton purchase operation of the CCI.
• Thus, the farmers in general would benefit immensely if a system of price deficiency payment, using the differential between MSP and FHP, is implemented. At the same time, the government can also reduce its food subsidy bill on rice and wheat.
• Alternative 2: The second proposition involves basing deficiency payments on the difference between the previous three-yearly average price and the fourth year price. If the MSP is rejected as the target or reference price, and the average of past three years FHPs is considered as the reference price, the situation looks more or less similar.
• It can be seen from Figures 4a and 4b (p 57) that the average price of paddy as well as wheat in every fourth year through 2000–01 to 2014–15 was higher than the previous three-yearly average price; therefore, the government does not have to make any deficiency payment to farmers.
• In the case of cotton also, the FHP in every fourth year during the period 2004–05 to 2014–15 was higher than the previous three years’ average price in almost all cases; therefore, the government would not have to make any deficiency payment (Figure 5, p 58).
• In the case of tur, the government would have had to make a small deficiency payment in 2004–05 and 2011–12 and for gram in 2003–04. But, the farmers would have gained because normally they do not receive this kind of benefit, as there is no effective market intervention by the government for pulses.
• Relatively speaking, Alternative 1 seems to be more beneficial to the farmers and Alternative 2 to the government. But, all in all, both the government and farmers in general would be better off switching from the present MSP regime to price deficiency payment system, using both Alternatives 1 and 2.

Production Impact

• The role of MSPs in augmenting crop production in India has changed over time.
• While the price support along with high-yielding variety (HYV) technology played an important role in raising the production of rice and wheat during the 1970s and 1980s (the green revolution period), the supply response to price change has weakened over time.
• According to Vaidyanathan (2010), non-price factors, namely input, technology and institutions, play a fundamental and dominant role in agricultural growth.
• The result of a log linear regression analysis (Table 2) further shows that during the period 1998–99 to 2013–14, MSP significantly influenced output only in the case of wheat.
• For rice, the output response to changes in MSP was positive but statistically non-significant; whereas for cotton and gram, the impact was positive albeit statistically non-significant. For tur, the impact was negative but statistically non-significant.
• The role of irrigation was found to be positive only in the case of rice and cotton. Besides, the role of technology was positive and significant in raising the cotton production. As against this, price deficiency payment, not linked to current production and prices, is not supposed to have any effect on production.
• But, in reality, such payments indirectly result in reducing the price risk and increasing the incomes of participating farmers and, consequently, their ability to invest more and enhance output.
• Although this has yet to be demonstrated in practice and evaluated, a recent study suggests that switching from MSP to deficiency subsidies would be less distortive and less costly, without affecting the output adversely (Kozicka et al 2015).

Regional Variations

• However, if region-specific price deficiency payment mechanism is followed, the farmers in different regions would either benefit or lose differently due to regional variations in the pattern of temporal changes in prices.
• If we adopt MSP as the reference or target price, that is Alternative 1, the difference between FHP and MSP is quite frequent and large in several states in respect of the selected crops. In the case of paddy, the FHPs remained generally lower than the MSP in Bihar, but in Punjab it was higher than the farm harvest prices in most of the years (Tables 3a, 3b, p 58).
• The paddy growers in Bihar would be entitled to deficiency payment, but not those in Punjab. Wheat farmers in both Bihar and Punjab would benefit from deficiency payment based on Alternative 1, but those in Madhya Pradesh would not.
• In Tamil Nadu and West Bengal, the two prices remained largely close to each other. For wheat, the FHPs were mostly lower than MSPs in Bihar and Punjab, and therefore farmers in both these states would gain by way of deficiency payments.
• But, it was higher than the MSP in Madhya Pradesh. Therefore, wheat growers in Madhya Pradesh would not be eligible for deficiency payment as the FHP was higher than the MSP.
• In the case of cotton and gram, FHPs were higher than MSPs in most states in many of the years during the period 1998–99 to 2014–15. But, for tur, the FHPs were higher than MSPs between 1998–99 and 2009–10; however, these remained lower than the MSPs thereafter.
• In other words, the MSP of tur has been ruling higher than the FHPs in the past few years. So, the tur growers may not benefit from the deficiency payment principle; although in reality, all tur and gram cultivators on the whole shall benefit as presently there is no effective implementation of MSP in the country. Even if one considers Alternative 2, farmers might be better off.
• Table 4a through Table 4e (pp 59, 60) show the variations in FHPs in important states over time in respect of selected crops. It can be seen from Table 4a that in Andhra Pradesh the FHP of paddy in every fourth year was higher than the previous three-yearly average price, so no deficiency payment would be required.
• But, in the case of Punjab and Haryana, the fourth year price was lower than the previous three years’ average price in five out of 14 years considered . In other states, the fourth year FHP of paddy was lower than the three-yearly average price in at least two to four years.
• Similarly, in the case of wheat, no deficiency payment to farmers in Bihar, Gujarat, Haryana, Rajasthan and Maharashtra was required as the FHP in every fourth year was higher than the previous three-yearly average price.
• But, in Punjab, Madhya Pradesh, Uttar Pradesh and West Bengal, deficiency payment would have had to be made. In Punjab, the fourth year price was lower than the previous three years average price only twice in 14 years, while it was thrice in West Bengal .
• In the case of cotton, almost all states had some cyclical variation in FHPs and, therefore, the government would have had to pay the deficiency in prices. In the case of both tur and gram, almost all states except Bihar had witnessed deficiencies in the two prices in the fourth year and, therefore, the government would have had to incur a net loss of revenue, while the farmers would gain.
• The overall emerging scenario suggests that both government and farmers would be better off switching to the price deficiency payment mechanism from the present MSP system, irrespective of whether Alternative 1 or Alternative 2 is followed.

Key Challenges

• It becomes clear from the above discussion that the price deficiency payment system may be a better choice over MSP for both farmers and the government under certain conditions. However, there would be several challenges in the effective implementation of price deficiency payment system.
• First, if centrally fixed MSPs do not benefit farmers of all regions equally, as the costs of production vary from region to region, price deficiency payments, based on one national reference price, could be unequal too because the farm harvest prices also vary from state to state.
• Second, if the MSP system is criticised because of high programme costs, the price deficiency payment may be equally vulnerable on that count.
• In years when production of selected crops is high, market clearing prices may be pushed to very low levels and deficiency payments and, consequently, farm subsidy would increase (Russo 2007).
• The programme costs can be reduced to some extent by limiting payments up to 10% of the price difference, as the NITI Aayog paper indicates; however, this may or may not be politically feasible.
• Third, in an unregulated market, middlemen can create an artificial shortage or glut in order to increase their profits. In the presence of middlemen and traders, holding market power, the effects of price deficiency payments on either government subsidy or farmers’ welfare would be uncertain.
• Fourth, if the price deficiency payment programme is adopted, the government may stipulate to either scrap or phase out the food procurement programme and make the deficiency payment to farmers via direct benefit transfer into their Aadhaar-linked bank account.
• Once this happens, the procurement-based MSP will die a natural death. However, the real value of cash transfers may get eroded in a period of rising prices (Ghosh 2011).
• Fifth, there would be problem in the implementation of price deficiency payments through Aadhaar-linked land record and bank accounts because a large number of farmers do not have either of these. Also, informal tenants, who benefit from the MSP currently, would fail to benefit from any price deficiency payment.
• Sixth, in the absence of MSP based procurement of grains such as rice and wheat, farm market prices may fall. Hence, the gap between any statutorily fixed reference price and the FHP may be quite large, causing a loss to the government exchequer in terms of price deficiency payments.
• Seventh, farmers may view the price deficiency payments as a risk reducing income hedge and may not fully respond to market signals.
• Eighth, price deficiency payments linked to current production would affect farmers’ current production decisions and, therefore, would be questioned for being market distorting.
• Hence, the deficiency payments should be decoupled from current production and appropriately linked to fixed proportion of any past level of production. As a matter of fact, decoupled payments would also influence farmers’ wealth, risks and crop choice, although such influence could be lower than that of coupled payments (Bhaskar and Beghin 2007).
• Finally, another point to consider is that price deficiency payments in the US have shown mixed results. The countercyclical payments under the Farm Security and Rural Investment Act of 2002 and the PLC under the Agricultural Act of 2014 have posed many challenges.
• The PLC protects the farmers of the covered crops from a fall in prices below the statutorily fixed reference prices.
• But, the reference prices fixed, based on the high prices existing during the legislation debate of 2010–12, are not only much higher than the target prices fixed in the 2008 act, but also above the current market prices, warranting higher levels of deficiency payments and farm subsidy.
• This could accelerate “the move towards the US breaching its domestic support limit, set by the AoA ($19.1 billion)” (Dhar and Kishore 2016). Also, the US is more vulnerable to sharp swings in its notified support under the product-specific aggregate measure of support because of the nature of its programme and the willingness of the government to provide more support to farmers.
• A similar situation, though unintended, may frighten India’s policymakers, especially if MSPs are used as statutorily fixed reference prices, which are determined by costs of production as well as political considerations and hiked every year.
• In other words, effective implementation of price deficiency payments may be as difficult as the existing MSP policy. In fact, the risks due to price volatility and market imperfections can be often unpredictable and their management would pose a challenge.

Conclusions

• To conclude, the system of price deficiency payment is perhaps a better option than the existing system of MSPs for both the government and farmers.
• However, necessary safeguards and corrective measures have to be initiated, as and when required, to minimise the risks involved.
• Deficiency payments should be designed not only to stabilise or improve farm income but also to improve food security, fiscal prudence and sustainability of agriculture.
• From this perspective, deficiency payments should be limited or targeted to a few specific commodities unlike the PLC programme in the US which covers almost all crops and MSP in India, which covers as many as 23 crops.
• Otherwise, the relative advantages of price deficiency payment system over the MSP policy in terms of subsidy reduction would be lost.
• Besides, updation and digitisation of Aadhaar-linked land records and bank accounts along with legalisation of land leasing would be essential for any price deficiency payment programme to be adequately effective.

Note

• Calculated by the authors, using data sourced from reports of the Commission for Agricultural Costs and Prices, Government of India.

What Is Epistemology?

The concept of epistemology, derived from the Greek word episteme (knowledge) and logos (reason) refers to the theory of knowledge. An important branch of philosophy, it is the study of the nature, origin and limits of human knowledge. The nature of knowledge is as important as the origin of knowledge in generating relevant epistemology.

• No scientific study can be evaluated or justified by the norms of faith or dictates of authority. For example, the discoveries of Copernicus (1473–1543) and Galileo (1564–1642) were epistemologically shocking to the College of Cardinals who had the monopoly of knowledge in the 16th century in Europe. Ultimately only scientific truth and not beliefs can promote and sustain progress.
• Kuhn’s (1962) view of the evolution of science as characterised by long periods of gradual “puzzle-solving normal science” followed by paradigm shifts offers an explanatory hypothesis about the nature of knowledge creation. Ola Olsson (2000: 254) argues that knowledge is created through convex combinations of older ideas and through paradigm shifts. We investigate in what manner this happened in economics.
• The nature of knowledge creation in the discipline of economics, has not been subjected to any in-depth analysis or interrogation. The almost unquestioned dominance (certainly during 1980–2008) of neoclassical economics in the academic profession and the rather pathological antipathy to Marxian epistemology and institutional economics has not been subjected to proper scrutiny.
• What I am concerned here is not Marxism as a creed but Marx’s unique contributions to the knowledge of understanding the dynamics of economic progress and the nature of the process of social history.
• I have provided a comprehensive analysis of economics courses in Indian universities based on an examination of curriculum of 26 Indian universities (Oommen 1987). This lengthy piece, inter alia, refers to the overemphasis on neoclassical economics and the deliberate de-emphasis of Marxian epistemology and economic history in teaching.
• The author was particularly struck by the dominance of Paul Samuelson’s Economics1 (this textbook first published in 1948, ran into several editions) which preferred “economic principles that display some of the logical beauty of Euclid’s geometry” as against that of Marx who defined economics as the science which studies how historically specific systems of economic relations originate, operate and change (Marx 1973: 852–53).
• Samuelson ignores the larger question of fairness in the distribution of wealth and income, but upholds “market efficiency” as the central theme of economics. An alternate textbook of the day imbued with considerable realism written by Joan Robinson and John Eatwell of Cambridge in 1974 titled An Introduction to Modern Economics rarely appeared in the syllabuses.
• My misgivings about the content of syllabuses and method of teachings, have persisted (Oommen 2004: chapter 1, 2012, 2017).2 Recent writings by Piketty (2015, 2017) gave the author hope and encouragement to raise the issue once again. After Piketty: The Agenda of Economics and Inequality, in which nearly two dozen scholars, economists and non-economists, have written, can be taken as a signal for rethinking and reflection on the epistemology of the discipline.
• It is high time that teachers and researchers of the subject ask fundamental questions about how the economy works and for whom it ticks. We may recall that most scholars of political economy in the 19th century placed the issue of distribution at the centre of their analysis, of course motivated by the great social changes they saw around them.

Neoclassical Economics

The neoclassical paradigm is treated as an immutable ingredient of social life, and many of the arguments are presented as non-falsifiable. But as Karl Popper rightly points out, all scientific propositions must be falsifiable. Further, so long as you treat prices, supply and demand, long-run equilibrium, full employment and so on, as an integrated set, the question of private ownership, vested interests, influence, power and such other factors that affect allocation and management of resources in real life, stand automatically ruled out.

• That the arbitrary whims and fancies of the top 1% or even a hardcore of 0.1% can alter the social priorities, needs and options of the rest of humanity itself and manipulate several such vital issues, are conveniently forgotten. Indeed the arc of neo-liberalism is not an innocent artifact but an engineered ideology to justify and perpetuate accumulation process and market society.
• If we accept that the ontological vocation of human beings is to transform the society in which they live, then no social science can be neutral between ends as postulated by the neoclassicals. Indeed economics is an applied social science “as medicine is an applied natural science. Biologists who do not see curing illness as their main job are not doctors even when associated with medical school” (Hobsbawm 1999: 128).
• Two historical events, namely, the Bolshevik Revolution of 1917 in Russia and the Great Depression of the 1930s checkmated the continued ascendancy of the neoclassical paradigm and influenced the growth of new economic ideas in the 20th century. The Bolshevik Revolution and the subsequent growth of industrialisation in the Soviet Union exploded the laissez-faire postulates and altered the political, economic and intellectual landscape of the world.
• The Great Depression also severely shook the prevailing faith in the free market capitalist economy. No wonder John Maynard Keynes’ General Theory of Employment, Interest and Money that sought to explain the Great Depression and to suggest remedies proved to be a spectacular success.The World War II, the post-world war rehabilitation, the growth of post-Keynesianism, the quest for social change in the postcolonial world, the emergence of development economics4 as a subdiscipline of economics, and the rise of innumerable development centres throughout the world (including India) gave a strong setback to the free market paradigm and to neoclassical economics which provided its ideological basis.
• However, with the collapse of Soviet Union, the fall of the Berlin Wall, the increasing questioning of the state spending on welfare and military hardware, the rise of Margaret Thatcher in the United Kingdom (UK) and Ronald Reagan in the United States (US) to power led to the re-emergence of the neoclassical paradigm of market-mediated growth.

During the last three decades prior to the financial crisis of 2008 that led to the downfall of Lehman Brothers and several others following the sub-prime lending, neoclassical economics influenced the world’s policy regime. Although challenged, this body of knowledge still rules the roost and continues to enjoy the patronage of most universities, notably in the US.

For those who embrace capitalism as an ideal, individuals are always rational and markets always work perfectly.

From the inception of the Nobel prize in economics by the Sveriges Riksbank of Sweden in 1969 till 2017, 49 prizes for 79 economists (39 of them are US citizens) were awarded. While the bank and the Royal Swedish Academy that give the awards have all the right to set the norms for the choice of awardees, even a cursory review of the citations and certainly the works of most of them show a pronounced bias in favour of neoclassical economics.

There are exceptions like Gunnar Myrdal, Amartya Sen, Paul Krugman and Joseph Stiglitz who could not be counted as neoclassicalists. Evidently, abstruse abstractions were chosen for research when the world faces abject poverty, growing inequality in wealth and income, intolerable inequity in the availability of opportunities, and such other acute societal problems. What Robert Solow (Nobel in 1987) while probing “inside the minds of 12 Nobel laureates” in his book Economics for the Curious observed recently (2014a) is worth citing:

The fundamental goal of economics as a discipline is to bring organized reason and systematic observation to bear on both large and small economic problems (and to have some intellectual fun on the way).

How can anyone say that economics is “for the curious” and the creation of “intellectual fun” as its avocation? Does the continued preference given to the neoclassical paradigm and its mathematical formulations provide the signal for future agenda for teaching and research? While so-called representative democracy is at best only a defender of capitalism (Dunn 1992), can the institution of social democracy or democratic values of social inclusion remain silent on questions like, for what and for whom the GDP (gross domestic product) is produced and how the claims on it are actually settled? Why economists shy away from questions of inequality and fairness in distribution? The Nobel prizes in economics do not seem to serve as a beacon for concerned social scientists to confront these and similar questions.

Richard Thaler of Chicago University, well known for his “nudge theory”

won the Nobel prize in economics for incorporating psychological assumptions into individual situations. While this is in refreshing contrast to the rational choice of neoclassical theories and opens up a rich area of study, the danger comes when policymakers like the World Bank use it as a theoretical legitimisation for inane policy options to fight poverty, inequality and the like. It is pertinent to read this author’s critique on World Bank’s “new set of development approaches” to contain poverty which to the bank is a behavioural distortion and that the poor alone have to be blamed for their plight.

• In this section, I wish to raise the question of why the Western academia as well as their colonial counterparts have treated Marxian epistemology and institutional economics with apathy while rewarding neoclassical economics and behavioural economics.
• The huge edifice of knowledge that Karl Marx created has been dismissed as poison and propaganda unsuitable for students. Can anyone consider Das Kapital and for that matter Marx’s writings in general as irrelevant knowledge? No one can refute the fact that Marx provides an excellent framework of analysis of capitalism. Mark Blaug, a noted historian of economic thought, points out that Marx wrote “no more than a dozen pages on the concept of social class, the theory of the state and the materialist conception of history” while he wrote “literally 10,000 pages on economics pure and simple”.
• Unlike the courses in macroeconomics and microeconomics that engage in abstractions, Marx does not see theory and practice or abstract and concrete as belonging to two distinct spheres. For Marx, what is abstract is closely related to what is concrete. In fact, the object of his epistemology was as much to interpret the world as to transform it. Those who love economics for its elegance and beauty are in a different moral universe altogether.
• As Thorstein Veblen (1857–1929), Clarence Ayres and other institutional economists argue, contemporary society has been considerably influenced by the folklores and mores of neoclassical economics (Ayres 1952, 1961). As noted above (and explained further in the next section) this paradigm is not an innocent artifact, but a strong ideological underpinning of the capital of the world to have their way and use all their might to perpetuate it as well exemplified in Piketty.
• Like Marxists, institutional economics founded by Veblen and enriched by a large number of economists rejected the neoclassical orthodoxy, including its most popular version by Samuelson, who attempted a grand synthesis of microeconomics (neoclassical economics) and macroeconomics (the Keynesian economics). Institutional economics proceeds on the assumption that human beings are interdependent and social and are influenced by social institutions.
• Institutional economics tries to show that the ability of a given society to use new problem-solving knowledge is limited by the patterns of social, political and economic dominations by the rich and powerful elites of that society. Here it is pertinent to quote two scholars on economic thought to show the indifference of the academic establishments towards these sources of knowledge.
• In many economics departments, the ideological domination of conservative neoclassical economists resulted in a situation in which the study of Veblen’s writings became personally, politically, and ideologically “unwise” as did the study of Marx’s writings. Evidence that a young economist took either Marx or Veblen seriously was often construed as evidence of intellectual incompetence.
• Consequently the institutionalist and Marxist schools of economic theory have remained small.
• Professional marginalisation of those who prefer socially relevant studies is a type of intellectual apartheid that must be fought for the sake of progress, alternate thinking and pursuit of relevant epistemology. It is in this setting that I wish to mention the arrival of Thomas Piketty.
• Several economists like Solow who got the Nobel prize in economics for their neoclassical scholarships have praised Piketty for the quality of his work and relevance of his findings (Solow 2014b). An empiricist par excellence, the historical evidence Piketty produced (covering 300 years and 20 countries) along with his reasoning and above all his accent on relevance rather than elegance should make many a Nobel pundit to sit back and reflect.

The Challenge Posed by Piketty

Social thinkers, economists, policymakers and ordinary people the world over have been shaken by Piketty’s book Capital in the 21st Century. That millions of copies have been sold in over 30 languages is something that the economics profession has to take note of. He has pushed forward our understanding of the working of the economy.

• His impact overflows into all social sciences. Economics has no special claim in explaining social reality and Piketty correctly treats economics as a subdiscipline of social sciences, alongside history, sociology, anthropology and political science
• Given the well-entrenched epistemological foundations of mainstream economics, it is very difficult to dislodge it.
• Boushey et al (2017) provides convincing evidence that show that the agenda for reforms of teaching, research and policy choices is formidable.
• Can the so-called “scientific” world of economists, close their eyes to the Gilded Age unfolding before them, ignore the reality of patrimonial capitalism, relentless “opportunity hoarding” and so on well underway in the world? I may mention a few lessons the discipline may do well to draw from the book:

1. history is the main source of knowledge of the economists and is the laboratory of the discipline;
2. price system knows no morality;
3. there is need for the democratisation of economic knowledge for continuously reinventing democracy. It is very important to note that economic rationality tolerates the perpetuation of inequality and in no way leads to democratic rationality (Piketty 2014: 551);
4. the destabilising growth of income and wealth is a writing on the wall and demands radical policy choices; and
5. in the context of “the past threatening to devour the future,” the call to the economics profession to bring back the political economy tradition of distribution into the centre of its discourse is very important.

Piketty has stressed the point that the profession needs a relook:

To put it bluntly, the discipline of economics has yet to get over its childish passion for mathematics and for purely theoretical and often highly ideological speculation, at the expense of historical research and collaboration with the other social sciences.

• Economists are all too often preoccupied with petty mathematical problems of interest only to themselves. This obsession with mathematics is an easy way of acquiring the appearance of scientificity without having to answer the far more complex questions posed by the world we live in.
• Hence they must set aside their contempt for other disciplines and their absurd claim to greater scientific legitimacy, despite the fact that they know almost nothing about anything.
• To conclude, I must say that Piketty’s work has upset the apple cart of mainstream economics. To be sure, the mighty defenders of the faith will fight back. Even so, he proved that the balancing forces of growth, competition and technological progress in the past have not succeeded in reducing inequalities and promoting social harmony.
• The world has before it incontrovertible evidence of widening inequality and its dangerous consequences (Oxfam 2014; World Inequality Lab 2018; Stiglitz 2012; Wilkinson and Pickett 2010; among others). Democratic societies and democratic values face serious threats. A global conversation and debate has to be initiated at the academic as well as the United Nations level sooner than later. Will the economics profession creatively respond? It is high time that we realise that pedagogy in graduate courses is sterile. The research agenda of universities also must radically change.
• If university departments are going to be funded by corporates, this can only be counterproductive. When the very large majority in the world has little access to quality education, good healthcare, good housing, quick transportation and no entitlements to participate in the market, why do the tribe of economists continue to chew the cud of neoclassical economics and call themselves “social” scientists? Certainly Piketty has not said enough about slavery, power, wealth dynamics, exploitation, and social justice, which should occupy the agenda of economics research and teaching to make it a relevant social science.