Do you know what you are reading?

Two senior executives of Zee news have been arrested on charges of extortion. Navin Jindal (owner of a steel and mining conglomerate and a sitting member of parliament on a Congress ticket) has alleged that he was being blackmailed by the media house and asked to pay up Rs. 100 crore ($ 18.2 million) over a period of four years in advertising money to Zee news. A grainy video (edited version) allegedly shot by the Jindal employees has been posted on Youtube. The video suggests that a deal is being struck to prevent damaging coverage of coal mine allocation to the Jindals. Zee news has rubbished the allegation and the case is now sub judice. More will be revealed in the coming months, but this leaves us wondering whom to believe and what to ignore?

It is widely accepted that Indian media is free and uncensored, which to a large extent is true. All the media reporting on scams by the sitting UPA government would not have been possible without a free media. The kind of support lent by the media to Anna hazare’s movement, which was clearly anti establishment, once again proved the freedom enjoyed by Indian media. Despite this there are a lot of grey zones. As claimed in the Jindal video by the Zee executives that the likes of Amir Khan and Madhur Bhandarkar (well known Bollywood actor and director respectively) also have to pay for news coverage and that the front page stories in The Economic Times are paid, are enough to shake our faith in independent reporting. The ugly nexus of corporate world and media companies has come to the front.

The colour yellow looks good on mailboxes
not on newspapers

Indian society has always relied on media. The secretly published regional newspapers during colonial times were trusted over the official media. When Indira Gandhi declared state emergency on 26^th June 1975, newspapers protested by leaving blank front pages and announcing the demise of democracy in their obituary columns. Indians have grown up trusting their newspapers. After the advent of private electronic media more people now rely on them for independent news and views rather than on state media. The change in which started in mid 90s did little to assign accountability to the media. Media houses disclose little about their investment structure, their relationship with other media firms and businesses. Disclosure is completely lacking when it comes to reporting. As a reader one is entitled to know the background of a news piece.

Take the example of the Zee news Jindal scandal. There was wide spread reporting of the matter in various newspapers including DNA. DNA batted for Zee news and carried full press statements from the electronic channel. What it failed to inform the readers was that DNA is part owned by Essel Group which is also the owner of Zee news. Readers would have formed a better opinion if this information was disclosed in the news article. Non disclosure of full information is just one aspect of dishonest reporting.

The problem of misleading the readers is not limited to business reporting. Popular, award winning journalists like P. Sainath (writes mostly for The Hindu, a Chennai based newspaper on social cause related to farmers and poverty) too tend to distort or hide facts in their reports. In his article, “To fix BPL, nix CPL” published on 26^th March 2012 he talks about how the government is helping corporate world by writing off Rs. 5 lakh crore ($ 91.4 billion) in the annual budgets since 2005-06 as revenue foregone. He on purpose fails to tell his readers what exactly is included under the revenue foregone head. Reading the article one gets the impression that it is all about giving concessions to big multinationals at the cost of poor people. The truth however is that revenue foregone includes more than just tax breaks to businesses. It includes the amount waived off by the government under various sections of income tax (investments, donations, savings, provident fund and pension contributions, rent allowance, higher education loan, etc), area based exemption in excise for North Eastern states and hill states, etc. Revenue foregone is also the subsidy the government provides on cooking fuel, electricity to farmers, fertilizers, etc. If the readers know the real definition of revenues foregone they would probably form a different opinion.  

Indian media which carries out anti corruption campaigns should start doing some housekeeping. It is time that the readers are given honest information complete with background information where ever it is required and clearly disclosing their business and investment relationships. Reporters like P. Sainath who are known for their good work and recognized by international institutions of repute should not mislead their readers by promoting their agenda instead of reporting.

The Zee news scandal should also send a signal to the readers on how they form their opinions. They should learn to question the report and try to find out the truth behind it. Blindly believing or rubbishing a report will turn us into a herd of sheep.

Exchange rate used is of today, 29/11/12 USD @ 54.73

A new dawn – Suu Kyi warms up to India

The winds of change in Myanmar brought Ms Suu Kyi to India, her first visit since her release from her house arrest. Her visit is getting covered extensively by the Indian media, something that the other heads of neighbouring states hardly manage to get. Her close relationship with India as her educational base, her father’s close political relations with India in early days of independence and her being a noble laureate have all contributed to the excitement of the press. In her interviews she appears as a calm and composed person who has overcome her bitter experiences and has moved on. She talks of being disappointed by India’s failure to support the democratic cause of her movement, but immediately jumps to accept the pragmatic aspects of diplomacy and wants to start a new chapter. Her visit has provided India a golden chance to shrug off the past and start a meaningful partnership with Myanmar.

Myanmar used to be an important trade partner of colonial India. Hundreds of thousands of Indians from Bengal (now divided as West Bengal in India and Bangladesh) went to seek their fortune in Myanmar. The Marwaris (a trading community from western Indian state of Rajasthan) established trade links and industries in Myanmar. Regular ferry services used to connect the Indian trade hub of Kolkata to Yangon and then onwards to Singapore. Indian cinema of the 40s had references of getting telephone call from Rangoon (now Yangon) where the protagonist has gone to work. Such were the close relations between the two countries. Much has changed since independence and post military takeover of Myanmar. So much so that Ms Suu Kyi could not fly direct but had to make a stopover in Bangkok to reach New Delhi.

Advantage Myanmar

The sky looks brighter, for you and for me

Myanmar shares its borders with India on its west, China on its east and Thailand on its south. All three countries are fast growing economies with a huge middle class. Myanmar is also the only ASEAN (Association of South East Asian Nations, a regional trade bloc) state to share borders with India. The country was long isolated from rest of the world due to the military rule and international sanctions, leading to a low industry base and a small economy. However the social indicators of the country are healthy with high rate of literacy and low unemployment.

Indicator	Value*	Comparison with India*
GDP	$82.68 billion	Revenue, Tata sons 2011-12 $100 billion^
Literacy	89.9%	74%
Median Age	27.2	26.5
Population Growth	1.07%	1.2%
Unemployment	5.5%	9.8%
Urbanization	34%	30%
*CIA world fact book, ^financial results Tata sons

The economy of Myanmar depends largely on agriculture. 40% of the GDP contributions come directly from agriculture, major industries are also engaged in agricultural processing and timber. Other industries are mostly in natural resource mining and oil production. This combination gives an ideal platform to build the industrial base of the country and diversify its economy. Geographical advantage of Myanmar can help India connect with the fast growing ASEAN market by linking its surface connectivity.

Top of the list

India should look at long term prospects of closer ties with Myanmar and prepare a list of top priorities. Given the low industrial base of Myanmar there is a huge potential for Indian companies to setup base there. India in the past decade has developed skills in automobile, pharmaceuticals, steel, cement, etc. all these will be required in abundance once Myanmar opens up fully for investments. India should also offer help in institutional reforms like training of civil servants, setting up of an independent election commission, training and recruiting staff to oversee elections, building capacity to improve infrastructure, etc. Another major exercise will be to provide direct connectivity between the two countries, both surface and air. India is already providing financial help to Bangladesh to connect its north eastern states. Similar help can be provided to Myanmar to complete the seamless connection into ASEAN. There are proposals of intra ASEAN high speed rail networks. India will benefit by linking its own rail network to that of ASEAN. Increasing business relation will feed the demand of travel and improve productivity.   

All this will however not happen till basics of a healthy business environment are not put into place. Independent judiciary, enforcing contracts, transparency in governance, etc are some of the aspects Myanmar has to reform before foreign investment starts pouring in. This however should not stop the Indian government and business to start chalking out their Myanmar plans. 

Feeding a billion mouths

The green revolution, which took off in late 60s in India, made her self sufficient and virtually ended her dependence on international food aid. A mix of high yielding seeds, increased use of fertilizers and modern irrigation systems brought more land under agriculture. Today India is self sufficient and in some cases also provides food aid to other countries. Having said that there are some disturbing statistics, which paint a different picture all together. The HUNGaMa (hunger and malnutrition) survey (carried out by Naandi, a social sector organization) of 2011 was carried out in 100 focus districts across India to measure hunger and malnutrition among children. The results show that 40% of children surveyed were malnourished and 59% were stunted. The percentage of malnourished children is double that of Sub-Saharan Africa, which is among the poorest regions in world. On the positive side, the report says there is reduction in prevalence of child malnutrition with proportion of underweight children decreasing by 20.3% over a seven-year period (2004-11) with an average annual rate of reduction of 2.9%. The situation is extremely alarming.

The incidents of malnutrition can be attributed to many things. Lack of awareness, poor public distribution network, high wastage during transportation and storage, inefficient farming methods, all contribute their share in denying access to nutrition. 

Stop the rot 

Thanks to efforts during green revolution, more agricultural land was brought under assured irrigation, thus reducing its dependence on unpredictable Monsoon. In the past few years the total combined harvest of the year has been satisfactory and particularly the Rabi crop (harvested in spring). With bumper harvest for consecutive years the storage infrastructure ran out of capacity and fresh harvest was stored in open. For the last two years millions of tons of wheat were left to rot in open due to poor storage strategy. The governments at state and centre failed miserably to find a solution to the problem.

Productivity of Indian agriculture is another major concern. Successive governments have doled out large amounts on farm subsidies with cheap fertilizer and free power (in some states). This has done little to boost the per unit productivity. According to a study by Prof. Mahendra Dev of Indira Gandhi institute of Development Research, per hectare yield of rice is 3.4 tons in India, compared with the global average of 4.31 tons per hectare and 6.6 tons per hectare of China . The government should realize that freebies will never be judiciously used. Free power for example has lead to over exploitation of underground water and has depleted water tables at an alarming rate. Subsidised fertilizers coupled with poorly trained farmers on optimal usage, has lead to deterioration of soil quality. The situation is complex with staggering inequalities. On one hand there are stunted children and on the other the government is unable to deal with problems of storing excess food grain. Huge amounts are spent on farm subsidies, yet the yields are below global averages. There is an urgent need for India to embark upon phase two of green revolution.

To start with investments should be made in creating more storage facilities and modernizing the existing ones. Food Corporation of India (FCI) has become one of the most inefficient bodies which lets huge amount of food to rot and get wasted every year. FCI is also responsible for the corrupt Public Distribution System (PDS) which is the government’s arm to sell food to the poor at a subsidised rate. Even the Supreme Court of India has observed that the present system of distribution is highly corrupt and ineffective. The government should bring in transparency in its workings and shift from food subsidies to cash subsidies. Bringing in private investment in such areas will take some burden off the shoulders of the government and would introduce smooth functioning.

Lessons should be learnt from dairy cooperatives, where individual farmers with only a couple of cows are able to reach a larger market and get benefited from economies of scale generated. Individual farm holdings in India are smaller compared to countries with high per unit yield. According to the 2001 census 80% of farm holdings are less than two hectares. 62% of these were less than half a hectare. With such small holdings it is difficult for the farmers to raise capital or benefit from economies of scale. Farm cooperatives will be an ideal solution to use equipment, seeds, manpower in a collective manner and benefiting from it. This will also free up a lot of workforce for other high value jobs (according to world fact book of CIA, 50% of total workforce in India is working in farm sector, which contributes less than 18% to the total GDP).

Finally the government should provide infrastructure for quick distribution of food across the country so that artificial inflation can be curbed. Good transport infrastructure will reduce wastage and ensure availability when it is required. Food wastage in India (during transport) is colossal. Some estimated put the figure at 40% (including vegetables). Eliminating wastage is one way of controlling price. These measures will help in ensuring food security for India in the coming years and would keep prices under control. High food prices are a major reason why people are pushed back into poverty.