The reshuffle in the BJP and the message

Neena Vyas
The Hindu, 31 January

The move is a clear signal that no leader, howsoever powerful, is above the party.

PERHAPS THE most important message that Bharatiya Janata Party president Rajnath Singh has sent out through the re-shuffle of his team is that no leader, howsoever big, is above the party. A big party machine like the BJP closely monitored as it is by its mentor — the Rashtriya Swayamsevak Sangh — cannot be taken for granted.

It is this message that seems to come through in the dropping of Gujarat Chief Minister Narendra Modi from the party's highest decision-making body, the Parliamentary Board, and from its Central Election Committee that has the final word in the selection of candidates for elections to the Lok Sabha, the Rajya Sabha, and the StateAssemblies.

The other big leader he has touched, but not needled, is Arun Jaitley, from whom the responsibility of leading the team of party spokespersons has been taken away. It is also not a coincidence that Mr. Jaitley has been the most articulate supporter of Mr. Modi in the BJP — riots and all. Even the Leader of the Opposition and former party chief L.K. Advani comes second to Mr. Jaitley in his support for Mr. Modi.

As far as Mr. Jaitley is concerned, no one in the party doubts his capability and intellect.

However, many senior leaders suspect that the spate of media reports over the last couple of years against some senior leaders, including Mr. Advani and the former Prime Minister, Atal Bihari Vajpayee, were inspired by Mr. Jaitley. That explains the decision to keep him away from the media.

For some time now it has been acknowledged by those outside and inside the BJP that Mr. Modi is undoubtedly the one saffron leader who has a firm support base. He virtually commands the whole of Gujarat and his detractors in the State have been unable to have their way despite several serious attempts to get him removed. His vice-like grip over the State's administrative and political machinery is so complete that he has now totally shed his earlier dependence on the support of RSS organisations such as the Vishwa Hindu Parishad and the Bajrang Dal.

Party leaders admit that after the heyday of Kalyan Singh's leadership in Uttar Pradesh — the party bagged more than 50 Lok Sabha seats in two consecutive elections — there has been no leader other than Mr. Modi who has shown he can deliver a victory single-handedly.

Mr. Modi's name had been in the air even as early as the middle of 2005 when it became clear that Mr. Advani's time as party president was coming to an end. Would he be catapulted on to the national stage and given charge of the party? That did not happen for two reasons — one, the BJP needed him in Gujarat; and, two, the RSS perhaps did not want another "star" (like Mr. Advani) who might some day think it to be dispensable.

There is also the view in the upper echelons of the BJP that even to win the next election in Gujarat the anti-Modi faction in the State led by the former Chief Minister, Keshubhai Patel, needed to be given some hope that Mr. Modi will not be allowed to ride roughshod over everyone all the time.

Mr. Modi may have managed to stay on as Chief Minister despite a clear indication by Mr. Vajpayee after the National Democratic Alliance defeat in the May 2004 Lok Sabha election that his days as Chief Minister were numbered. But that does not mean he is to be allowed to have his way at the State level and at the Centre.

It is more than clear that Mr. Rajnath Singh could not have moved against Mr. Modi without the RSS agreeing to it and without the approval of Mr. Vajpayee whom Mr. Singh is known to have consulted before announcing his team.

The carrot and stick approach adopted by Mr. Singh is also evident in Ananth Kumar's elevation as member-secretary of the party's Central Election Committee. Mr. Kumar was earlier not allowed to have his way in Karnataka where he did not want Sadanand Gowda to get another term as State unit president. Nor was he too happy at the prospect of B.S. Yediyurappa taking over as Chief Minister from H.D. Kumaraswamy later this year under the arrangement between the BJP and its coalition partner — the Janata Dal (Secular).

The other major change was the dropping of Sanjay Joshi as general secretary (organisation) and replacing him with Ram Lal, another senior RSS pracharak. Apparently, after the scandal involving him that had rocked the BJP's national council session in Mumbai in December 2005, his going was considered necessary to wash clean the stain that had been splattered on the "character" of RSS pracharaks. He resigned at that time only to come back after an internal inquiry found him to be innocent. The idea was to allow him to go with dignity.

And finally, it must be said that even the dropping of Mr. Joshi takes one back to the main subject: Mr. Modi. To this day many senior leaders suspect that he was part of the sting conspiracy. After all, the animosity between Mr. Modi and Mr. Joshi goes back a long time.

Let's jointly work for peace: Tutu

Special Correspondent
The Hindu, 31 January

As long as disparities prevail, the war on terror cannot be won, he says

NEW DELHI : The war on terror cannot be won as long as disparities prevail and people are treated as rubbish. The key to peace and prosperity is in working together.

South Africa's crusader against apartheid Archbishop Desmond Tutu said this on Tuesday at the closing plenary of the two-day international conference here on "Peace, Non-violence and Empowerment — Gandhian Philosophy in the 21st Century."

Referring to conflict zones such as Iraq, Sri Lanka, Chechnya, Myanmar and West Asia, he said the catalogue was long but peace and stability could be attained through negotiations, compromise and attempts by warring parties to understand one other.

The Nobel laureate said those who wielded power and inflicted suffering on fellow human beings were forgotten but the world had deep reverence for great people such as Mahatma Gandhi, Nelson Mandela, Mother Teresa and Aung San Suu Kyi.

Pat for Manmohan

While describing the conference as a "moving and significant event," Archbishop Tutu had a special word of praise for Prime Minister Manmohan Singh for charting India's economic growth.

Turning to Congress president Sonia Gandhi, he said he was "greatly moved when you ... willingly stood down at a time when your candidature was going to cause a bit of rupture; thank you for your graciousness." Dr. Singh said Satyagraha should not be viewed as a means of obstructing dialogue or change. "We must respect the value of dissent. But those who dissent must also respect the value of building consensus. We must foster tolerance of the other point of view. Violent conflict never allows this. Violence deafens us. Non-violence helps us hear."

The conference adopted a declaration resolving to work towards a world free from hatred and violence; united in mutual trust, harmony and friendship; for more equitable access to global resources; united in struggle against poverty, illiteracy, diseases, injustice and hunger; free from nuclear and other weapons and where territorial boundaries became irrelevant.

It appealed to the U.N. to declare October 2, birth anniversary of the Mahatma, International Non-violence Day.

Economist Wants Business and Social Aims to Be in Sync

NYT, January 30
By LOUIS UCHITELLE

Dani Rodrik, a trade economist at the John F. Kennedy School of Government at Harvard, received his introduction to the idiosyncrasies of globalization while growing up in Turkey.
His father made ballpoint pens, protected by high tariffs from less expensive imports. The company was successful enough that his father could afford to send Dani to Harvard in 1975, the first in the family to study abroad. The younger Mr. Rodrik, a tall, thin, soft-spoken man, still credits Turkey’s effort to support less-efficient domestic manufacturers for his good start in life.

“I am the creation of import substitution,” he says, playfully aware of the incongruity of having benefited from an approach that flourished in the developing world a generation ago and is now widely disdained.

The experience helped Mr. Rodrik, who is 49, develop a flexible approach to trade. He has built a reputation among mainstream economists and policy makers for favoring eclectic solutions that mix government and the private sector in pragmatic ways.

“You scratch the surface of most industries that are successfully developing export capacity anywhere in the world,” he said in an interview, “and you will invariably find a combination of market forces and government forces at play.”

His specialty is the developing world and he tries, in his travels as an adviser, to help countries improve the mix. Now he is arguing for an improvement in the United States, his adopted home.
As a practical matter, he says, Washington must counteract the damage from America’s trade policies more than it has in the past. It is a message that is resonating not just with populists in both parties, who have long been skeptical of the benefits of globalization, but increasingly with mainstream policy thinkers, many of them associated with former President Bill Clinton.
The focus, Mr. Rodrik and others argue, should not be simply on cutting tariffs and eliminating other barriers, but on offsetting the negative effect on wages and jobs from the spread of globalization and outsourcing.

“The consensus until recently was that trade was not a major cause of the earnings inequality in this country,” said David H. Autor, an economist at the Massachusetts Institute of Technology. “That consensus is now being revisited.”

He added that “not everybody agrees with Dani, but at this point there is agreement that outsourcing abroad, in particular, is potentially a source of real downward pressure on employment and wages.”

Like most economists, Mr. Rodrik believes that unrestricted trade enriches the participating nations, helping more people than it hurts. But in his view, this is not the moment to lower trade barriers another notch.

The movement across borders of goods, services, capital and production, he said, is “open enough as it is.” He would concentrate instead on building public awareness that social insurance and free trade are “two sides of the same coin,” a concept entrenched in Europe but not in the United States.

“The people who talk incessantly about trade and its importance,” Mr. Rodrik said, “do so without recognizing the importance of the social insurance agenda as part and parcel of that process.”

Unlike Mr. Rodrik, most mainstream economists favor pushing ahead with the currently stalled Doha round of negotiations, aimed at further reductions in trade barriers.

Still, many Democratic policy thinkers are beginning to embrace the Rodrik argument that trade and social programs must be intertwined. And they talk more about that lately than restarting the global trade talks.

“The best thing we can do for free trade is focus on strengthening domestic policies that strengthen social insurance,” said Jason Furman, director of the Hamilton Project, a research group founded by Robert E. Rubin, who served as Mr. Clinton’s Treasury secretary.

The goal of the Hamilton Project is to put together economic policies aimed at influencing the Democratic Party’s platform. When it comes to trade, Mr. Rubin and his followers want to push ahead with further trade openings, disagreeing with Mr. Rodrik on this point. But to soften the backlash they, too, propose a safety net that goes beyond the education and retraining that was Mr. Clinton’s principal response in the 1990s to the damage from trade.

“My argument is that we need to have a new social contract,” said Jacob Hacker, a political scientist at Yale who is working on a plan for health insurance modeled on Medicare and a program to provide subsidized 401(k) accounts. “This new social contract won’t be as extensive as those in Europe,” he added, “but it will move a lot of the responsibility for providing economic security off the backs of employers.”

Mr. Furman, for his part, singled out two priorities: a law that would maintain health insurance for laid-off workers and another that would provide wage insurance for American workers, paid out when a worker loses a job and finds another but at lower pay. The wage insurance would make up some of the lost pay during the first two years in the new job.

“People are more likely to support free trade,” Mr. Furman said, “if it does not have the intense personal downside that it so often has today.”

For all the similarities between Mr. Rodrik’s thinking and that of the middle-of-the-road economists associated with the Hamilton Project, there are some important differences, too. Among them is Mr. Rodrik’s matter-of-fact insistence that in the rest of the world, trade goes forward because government plays a decisive role in promoting it.

Mr. Autor counters that Mr. Rodrik puts too much trust in policy makers. “Government does not have special information that allows it to pick winners and losers,” Mr. Autor insisted. “So unless there is a specific market failure that requires public intervention, we economists do not presume that government does a better job than the icy fingers of the invisible hand.”

N. Gregory Mankiw, a Harvard economist and a former chairman of President Bush’s Council of Economic Advisers, puts the mainstream case in the language of David Ricardo, the 19th-century British economist whose initial description of the doctrine known as “comparative advantage” still holds sway today.

“We in the United States,” Mr. Mankiw said, “have a comparative advantage in higher education, financial services, aircraft manufacturing and a variety of forms of intellectual property such as movies and software. Putting our resources into these rather than into areas where we don’t have a comparative advantage, such as textiles, allows us to increase the total income of Americans more than if trade were restricted.”

Mr. Rodrik sympathizes with this view, but he nevertheless says that in the developing world, almost no one practices hands-off economics. Government, he argues, often plays a role in creating a comparative advantage where one did not exist before. He made this point at the annual meeting of the American Economic Association in Chicago this month.

While several hundred people filled a large hotel conference room to hear a panel of economists discuss abstract trade issues, Mr. Rodrik, holding forth in a smaller meeting room two floors below, explained China’s success in concrete terms. Most of the 30 people in his audience were Asian economists studying in the United States or working here.

The Chinese government operated on several levels as that nation grew into an export powerhouse, Mr. Rodrik said. It nurtured the manufacture of electronic products and auto parts. It forced foreign investors into joint ventures with domestic producers. Beijing lowered trade barriers, he said, “only after it developed a relatively sophisticated manufacturing capacity.”

Absent an activist policy to protect China’s nascent industries, it would not have emerged as an export power, Mr. Rodrik said. “The traditional forces of comparative advantage,” he said, “would have pushed China to specialize only in the labor-intensive products ‘appropriate’ to low-income economies.”

Mr. Rodrik, who maintains his Turkish citizenship and is married to a Turkish woman who also teaches at Harvard, is descended from a family of Sephardic Jews who migrated to Turkey from Spain five centuries ago. During his senior year at a private high school in Istanbul, he applied to Harvard, mostly for the adventure of it, and was accepted.

“Like most Turks of my generation I thought I would end up doing engineering,” he said. But at Harvard, “a new world opened for me and I started to understand that the problems of underdevelopment were not technical problems in the sense of a lack of engineers or a lack of doctors. It was a problem of social organization.”

As an undergraduate, he majored in political science but, prodded in part by his father, he eventually entered the Ph.D. program in economics at Princeton. He taught for four years at Columbia before shifting to the Kennedy School in 1996, where he became expert at helping developing countries organize export industries.

“Costa Rica is not a natural place to manufacture semiconductors,” Mr. Rodrik said, citing just one example, but the government “got Intel to come in and do just that.”

Over the last year, his travels have taken him to South Africa, Portugal, China, the Philippines. In Portugal, the people he advises are trying to decide whether to invest heavily in vast retirement complexes for elderly Germans, French and British, or whether to make a “huge leap” into high-tech industries.

Mr. Rodrik encouraged the Portuguese to go down both paths. “You take into account that there is a lot of uncertainty about what will eventually be successful,” he said, “so you try to spawn experimentation in different kinds of economic activities.”

That, too, fits with his own experience in Istanbul, where the family business initially faltered as the spread of free trade reached Turkey. But an older brother, now running the business, shifted to selling imported pens. The transition away from tariff-protected manufacturing was not easy, he says, but his brother, too, was finally successful.

A question marked in red

Sumit Sark
The Indian Express, January 09

As a lifelong Leftist, I am deeply shocked by recent events in the countryside of West Bengal. On December 31, a group of us went to Singur, spent the whole day there, visited 4 out of the 5 most affected villages which border the land that has been taken over. We had conversations with at least 50-60 villagers. Almost all rushed to us and told us their complaints.

From this brief but not necessarily unrepresentative sample, three things became very clear, because of which the West Bengal government’s version cannot be accepted. One, the land, far from being infertile or mono-cropped, as has been stated repeatedly, is sextremely fertile and multi-cropped. We saw potatoes and vegetables already growing after the aman rice has been harvested, some of them actually planted behind the now fenced-in area which the peasants had lost. Two, there is no doubt that the vast bulk of the villagers we met are opposed to the take-over of land and most are refusing compensation. It should also be kept in mind that at best the consent of the registered landholders as well as sharecroppers is being taken. But agricultural production also involves sharecroppers who are not covered by Operation Barga since they have come in later, as well as agricultural labour. Under the government-announced scheme for compensation, such people are not being remembered.

Three, we found much evidence of force being employed, particularly on the nights of September 25 and December 2. We met many people — men and also a large number of women — who had been beaten up, their injuries still visible, including an 80 year old woman.

What the villagers repeatedly alleged was that along with the police, and it seems more than the police, party activists, whom the villagers call ‘cadres’ — which has sadly become a term of abuse — did the major part of the beating up. Clearly, the whole thing had been done without consultation, with very little transparency, and in a very undemocratic manner.

As for the official claims of land being mono-cropped, the Economic and Political Weekly in an editorial of December 23 has pointed out that the last land survey of the area was done in the 1970s which means that the records with the government are backdated. Surely there must be much more investigation on the ground and consultation with panchayats and other local bodies.

No one, not even the government, has actually claimed that such consultation has taken place. It was done entirely from the top.

These mistakes, to put it mildly, are being repeated on a much bigger scale in the Nandigram region. This has become far more serious because a much greater area of land is being taken — with the same lack of transparency, absence of consent and massive brutality. Once again, one is hearing reports of CPM cadres engaged in an offensive against peasants. What is happening at Nandigram is a near civil war situation.

The West Bengal government seems determined to follow a particular path of development involving major concessions both to big capitalists like the Tatas and multinationals operating in SEZs. Yet the strange thing is that these, particularly the latter, are things which Left parties and groups as well as many others have been repeatedly and vehemently opposing. No less a person than the CPM General Secretary in the course of last week made 2-3 statements attacking SEZs. The CPM has been at the forefront of the struggles against such developments in other parts of the country.

Surely there must be a search, at least, for paths of development that could balance necessary industrial development with social concerns and transparency and democratic values. Is this SEZ model that implies massive displacement and distress really the only way? If the West Bengal government thinks so, then it also has to accept that the inevitable consequences are going to be a repetition of Nandigram across the state.

This is the price that will be paid by government, ordinary people as well as investors for this model of development.

The writer is an eminent historian

Why Africa now relies on Arnold Schwarzenegger

Mary Riddell

Popcorn politics is doing more good for Africa than all the talk coming out of Davos.

I ONCE went for dinner at the British embassy in Khartoum. The walls were hung with oil paintings, the gin was iced, and the velvety interior suggested a Belgravia drawing room. Not far away, women held bone-thin babies who would die soon. Britain's then ambassador to Sudan knew little of such scenes. He did not seem to get out much. No doubt communications have improved.

No one need to move far now to witness desolation. Hollywood loves Africa and almost every multiplex is showing one or more lament on civil war. Blood Diamond and The Last King of Scotland, the two latest examples, have gathered Oscar nominations and plaudits for their assault on Western consciences. Both also carry an unmeant subtext of exploitation.

Like The Constant Gardener, they depict an Africa whose job it is to kill, to suffer, and to supply a backdrop for a white man's odyssey. The Last King, offers the tale of a Scottish doctor caught up with Idi Amin. Blood Diamond, set in Sierra Leone, is the vehicle for Leonardo DiCaprio and enough military hardware to provoke envy in any ordnance-starved general in today's Afghanistan.

Still, there is much to be said for the popcorn branch of foreign policy. Blood Diamond has sent a shiver through a gem industry that has offered Beyonce Knowles and Jennifer Lopez $10,000 each for charity to flaunt sparkling rings and repel any public-relations disaster. Although Sierra Leone, like most exporters, has cleaned up its trade, conflict diamonds worth $23 million recently reached international markets from the Ivory Coast. Consumers will ask more questions and Global Witness, the charity that publicises the link between natural resources and war, is justly proud.

Tony Blair must have wished, as he spoke in Davos on Saturday, that he had a film star's power. At the World Economic Forum, he reported progress since Gleneagles and placed the continent at the top of his agenda. On Darfur, there was no good news. It was, Mr. Blair said, "a scandal, not a problem."

An estimated 400,000 have died there and thousands more face genocide. Aid agencies are on the brink of leaving after the murder and rape of staff by the government-backed janjaweed militia and rebel groups. Moves to get U.N. peacekeepers in to help the existing African Union contingent have been frustrated by President Bashir, who has reportedly bombed villages in the last few days. The response is international silence. No one is queuing to make a film about Darfur.

Sudan's leader does not take kindly to scrutiny. Mr. Blair was uncertain, on the eve of his Davos speech, about how tough to sound. Is this the moment for the West to tell Mr. Bashir that he must make good his promises or face the consequences? Mr. Blair's eventual call for better peacekeeping institutions will do little for those whose lives are measured in days or hours.

In September last year, California Governor Arnold Schwarzenegger signed a law forbidding the State's investment, including its huge public pension funds, in firms dealing with Sudan.

Last week, German technologies group Siemens pulled out of Sudan, citing moral grounds. The British House of Commons Foreign Affairs Committee recently urged British businesses to do likewise and Sudan Divestment U.K. is targeting firms such as Rolls Royce. When I rang the company to ask if it was planning to withdraw, it emailed back to say that its exports were "fully consistent with the relevant export control regulations and help the development of Sudan, so that it has the ability to meet the economic and social needs of its population." I took that as a "no."

When Hollywood and industry have such sway, world leaders should cringe at their own lack of progress in Darfur. Despite U.S. and British oratory, and the advocacy of charities such as Oxfam, the blood still flows, the bombs still fall, and Europe looks the other way.

Europe must lead the way in demanding a no-fly zone and an arms embargo. Sanctions are vital to a political solution and getting more peacekeepers on the ground. But when politicians prevaricate, and U.N. Secretary-General Ban Ki-Moon has hit the ground dithering, there is also a case for pressuring big business.

A region is close to annihilation at the hands of violence and inertia, the twin agents of genocide. In Darfur, there may soon be no lucky people left. If nothing is done, then in 10 years' time, a film crew might resurrect its ghost villages and deserted farms. And people of good conscience and short memory will buy their tickets and vow to change the world as they weep over what need not have been.

© Guardian Newspapers Limited 2006

Can IT-enabled services lower corruption?

Prabhudev Konana
The Hindu. 29 January

Information Technology is not a panacea but it offers the potential to minimise day-to-day harassment and corruption.

A housemaid, Subbamma (name changed), recently lost her husband. She filed an application for Rs.200-a-month allowance in the taluk office under Vidhawa Vethana — the Karnataka Government's social security scheme for widows. She was shocked when a government official demanded a bribe of Rs.150. When she offered Rs.50, the official shot back that he was not a "beggar!" Of course, he is!

What else can he be? Before this, disgracefully, nurses in a government hospital in Bangalore demanded Rs.100 to 200 each time they shifted Subbamma's husband, who was in severe trauma, on to the hospital bed! It is a disgrace that no one is spared from the cancer of corruption and moral bankruptcy.

The rhetoric of "brand India" becomes meaningless when common citizens have to suffer from this menace. Public outcry against corruption is increasing but the impact is minimal. However, there appears some promise of reducing corruption through Information Technology-enabled services. IT is not a panacea but there is potential to minimise harassment of the kind Subbamma faced.

Recently, I was fortunate to moderate a panel discussion on the role of IT in economic development and better governance at the Indian School of Business, Hyderabad. P.M. Kuriakose, Commissioner of eSeva, Andhra Pradesh, provided an interesting insight into the impact of IT-enabled government services. eSeva is a public-private partnership programme to provide one-stop services, such as bill payment, and issue of licences, birth/death certificates, etc., to citizens.

The actual delivery of services is done through private franchisees compensated on the basis of the volume of transactions. The incentives are structured to provide service with courtesy and minimal delay. Of course, eSeva is still a long way from reaching all the citizens. However, its progress since 1999 has been remarkable. Over 61 million transactions have been processed through eSeva centres. It is believed that eSeva has improved service delivery and citizen satisfaction, and reduced corruption.

The lesson is that there are opportunities to reduce corruption by reengineering and digitising government processes, minimising direct contacts between the government and citizens, establishing appropriate controls and audit, institutionalising transparency and accountability, and privatising government-citizen interactions with appropriate incentives and controls.

Michael Hammer, a well-known business consultant who championed business process reengineering — that is, redesign of business processes to improve performance — wrote an article in the Harvard Business Review titled "Don't automate, Obliterate." He argued that firms should obliterate the existing ways of doing business, simplify processes, eliminate non-value added tasks, and innovate to improve speed, quality, and service. Simply automating the existing inefficient processes with IT provides no meaningful productivity improvements.

On similar lines, to reduce corruption in government services, we need to eliminate unnecessary government-citizen interactions! The potential for corruption increases when there are face-to-face interactions. Electronic interaction can obliterate them and leave a trail for potential audit.

But the focus should not be on IT itself, but on how the government carries out various activities — that is, processes. IT is a means and not an end in itself. Research suggests that the value from IT comes mostly from process improvement and incentive alignment. Thus governments may need to give more importance to processes than to IT itself.

Complex processes with enormous paperwork increase the potential for corruption. The more the paperwork and number of steps, greater are the opportunities for brokers (consultants) to step in to get any work done in government offices. Some of these brokers are hand-in-glove with officials and become conduits for organised corrupt practices. Performance metrics have less meaning since blame is passed on to others. Further, recognising the inefficiencies or potential loopholes, private citizens may themselves become party to corrupt practices.

One of the greatest benefits of IT is enforcing queue in the system. A well-known political scientist once asked me why queues form. My response was a typical technical answer. But he surprised me when he said queues inherently represent equality and when people do not perceive equality, they break queues. Sadly, people with money, connection, or power perceive others to be unequal and tend to break queues more readily!

IT will force applications to be processed in the order of arrival. It can enforce multiple queues with different priority levels based on the willingness of applicants to pay a premium for the service. In a non-IT system, willingness to pay or accept payment is played out through bribes.

One can debate whether government services should have different levels of priorities at all since the system will be inherently biased towards the wealthy.

However when processes are simplified, controls may be compromised. Fortunately, digitisation enables us to enforce rules and bring transparency. If a case is not processed within a certain time, the system can automatically trigger a notification for higher-ups. What if the higher-ups are corrupt? The government can make the status transparent so that non-governmental organisations or the media can report delays. In fact, citizens should be able to post delays and corrupt activities for the public to view. The government must provide a conduit for people to voice concerns, corruption, or compliments. Of course, corrupt citizens can use this conduit to abuse honest officials and, therefore, there is need for checks and balances.

Controls and metrics are necessary and the government has an obligation to make high-level aggregate information public. For instance, a government dashboard for each organisation may publicly list the number of cases in the queue, average processing time and its distribution, and the number of delayed cases. Organisational leaders must be evaluated on these metrics. These metrics can be derived from the system automatically. So there is little leeway in tampering with data.

Need for political will and vision

But the above is easier said than done. Even in the corporate world, a large majority of reengineering projects have failed for mostly non-technical reasons. There will be significant resistance from unions, governmental agencies, and powerful brokers who benefit from inefficiencies and have vested interest.

Service transformation will impact power structure, employee morale and skills, departmental boundaries, job security, information control, and incentive structure. Therefore, much like in a business environment where top management support impacts the success of reengineering and IT initiatives, there is need for strong political will and vision to make this transformation.
Of course, there are economic issues to be considered. IT is expensive to create and manage.

Often, the focus is upfront cost in creating information systems. However, over 70 per cent of the life-cycle cost of the system goes into maintenance. Furthermore, a large fraction of the population has no education or access to interact electronically. Thus, governments may run an expensive system to meet the demands of a small population and a parallel expensive, manual, and inefficiency-riddled system for the masses.

In the short run, the cost will go up. Therefore, governments must pursue public-private partnership where the private partner will invest and share some risks and reach the citizens with appropriate incentives, checks and balances. This does not mean that the governments outsource social responsibility to the private sector. But this is a way to bring market efficiency and better accountability. It is relatively easier to address inefficiencies with private agencies than to deal with corrupt government officials. Further, privatising the actual delivery will eliminate the main source of corruption — that is, government-citizen face-to-face interaction.
eSeva has made remarkable progress by addressing the above issues. Hopefully, as eSeva expands and the citizens find convenience and less corruption, there will be a societal demand for even cleaner government.

However, I am a firm believer that corruption is a two-way street. It is the result of sustained participation of both the public and the private in corrupt practices. Government officials demand bribes or private entities bribe for favours; both the giver and the taker are equally guilty. Corruption is a reflection of society's tolerance and active participation. In a democracy, eradicating it is not just the government's responsibility but societal collective responsibility.
Unfortunately, corruption has become a cultural issue and transforming this culture is a daunting task. Maybe, the fastest way to reform the corruption culture is to prosecute both the taker and the giver.

The author is a Distinguished Teaching Professor at the University of Texas at Austin and can be contacted at pkonana@mail.utexas.edu.

Agitators clash with police near Singur

Special Correspondent
The Hindu, 29 January

KOLKATA: Trouble broke out at different points leading to Singur in Hooghly district on Sunday when activists of the Trinamool Congress-led Krishi Jami Raksha (Save Farmland) Committee clashed with the police. The police prevented the activists from going to the Tata Motors' project site. The activists were participating in a "march to Singur' programme to protest against the project, violating prohibitory orders, which are in force in Singur.

Eleven policemen were injured in scuffles with the protesters in the Dankuni and Baidyabati areas — two of the four points in the district where the demonstrators had congregated with plans to converge on Singur, according to Inspector-General of Police (Law and Order) Raj Kanojia. Four of them had to be taken to hospital.

The police burst tear gas shells and used lathis and water canons to disperse the demonstrators who tried to break through the police cordon. Some protesters were armed with bamboo poles.

Cheney Says U.S. Is Sending 'Strong Signal' to Iran

By Michael Abramowitz
Washington Post, 29 January

Vice President Cheney said the deployment this month of a second aircraft-carrier task force to the Persian Gulf delivered a "strong signal" of the United States' commitment to confront Iran's growing influence in the region.

Countries in the Middle East "want us to have a major presence there," Cheney said in a Newsweek interview published online yesterday. Referring to the deployment of the carrier USS John C. Stennis, Cheney said, "That sends a very strong signal to everybody in the region that the United States is here to stay, that we clearly have significant capabilities, and that we are working with friends and allies as well as the international organizations to deal with the Iranian threat."

When the Stennis arrives in the Persian Gulf next month, the United States will have two carrier groups stationed there for the first time since the 2003 Iraq invasion.

The deployment is one of several recent steps by the United States to oppose Iran, which administration officials say is responsible for growing instability in the region. Other actions included a program to kill or capture Iranian agents operating inside Iraq as well as moves to squeeze the country financially.

In the interview, Cheney declined to speculate about possible military strikes against Iran. "We are doing what we can to try to resolve issues such as the nuclear question diplomatically through the United Nations, but we've also made it clear that we haven't taken any options off the table," he said.

The Newsweek interview was the third granted to the media this month by the vice president, who had been relatively quiet since Republicans lost both houses of Congress in November's midterm elections. Despite increasing GOP criticism of the White House on Iraq, Cheney said he thinks President Bush has shored up his position with his Republican base in the past week and evinced little concern about the prospect of resolutions formally condemning the president's plan to send another 21,500 troops to Iraq.

"Most members on our side of the aisle recognize that what's ultimately going to count here isn't sort of all the hoorah that surrounds these proposals so much as it's what happens on the ground in Iraq. And we're not going to know that for a while yet," said Cheney, who also offered a veiled shot at one of the president's strongest GOP critics, Sen. Chuck Hagel (Neb.). "Let's say I believe firmly in Ronald Reagan's 11th Commandment: Thou shalt not speak ill of a fellow Republican," Cheney said. "But it's very hard sometimes to adhere to that where Chuck Hagel is involved."

In an appearance yesterday on ABC's "This Week," Joseph R. Biden Jr. (D-Del.), chairman of the Senate Foreign Relations Committee, dismissed suggestions from administration officials that his resolution condemning the military buildup would embolden the enemy.

"It's not the American people and the United States Congress who are emboldening the enemy," he said. "It's the failed policy of this president, going to war without a strategy, going to war prematurely, going to war without enough troops, going to war without enough equipment and, lastly, now sending 17,500 people in the middle of a city of 6 1/2 million people with bull's-eyes on their back, with no plan."

Sinn Fein Agrees To Back Police in Northern Ireland

Vote Is Step to Restore Power-Sharing

By Kevin Sullivan
Washington Post, 29 January

LONDON, Jan. 28 -- Northern Ireland's largest pro-Catholic political party voted overwhelmingly Sunday to cooperate with the predominantly Protestant police force, a remarkable reversal that was widely seen as a critical step toward cementing peace in a British province recovering from three decades of sectarian war.

"Today you have created the potential to change the political landscape on this island forever," Sinn Fein leader Gerry Adams told about 2,000 party members after the nearly unanimous show-of-hands vote at a Dublin conference center.

The vote by Sinn Fein, the political affiliate of the Irish Republican Army, which waged a bloody struggle to free Northern Ireland from British rule, was a required step toward restoring a Catholic-Protestant power-sharing government in the province. The British government has given the bickering parties in Northern Ireland until March 26 to form a local government or see the province's affairs fully controlled by the central government in London.

Ian Paisley, the tough-talking leader of the largest Protestant party, the Democratic Unionist Party, and Sinn Fein leaders have sparred over several issues related to governing together, but none has been more full of anger, passion and history than policing. Catholics have long argued that the police have been a corrupt partner with Protestant paramilitary groups in systematically discriminating against them, often to the point of disregarding beatings and murder.

Catholic mistrust of the police was underscored last week by a report, issued by the independent police ombudsman, that concluded that police had colluded with Protestant paramilitary informers and protected them from prosecution even when they were implicated in murders and other violent crimes.

The report cast new doubt on whether Sinn Fein members could put aside their deeply held animosity toward the police and vote to endorse them -- a key goal of the landmark 1998 Good Friday peace agreements that called for Catholics and Protestants to share power to end a war that cost more than 3,600 lives.

Paisley made no immediate public comments concerning the Sinn Fein vote. In the past, he has said he would cooperate with Sinn Fein only if the party endorsed the police and demonstrated support for law and order. Paisley has been deeply skeptical of previous peace overtures, including the IRA's 2005 declaration that it had laid down its weapons permanently and renounced violence in favor of political solutions to the province's problems.

A spokesman for Tony Blair said the British prime minister "welcomes this historic decision and recognizes the leadership it has taken to get to this point."

Traditionally, many Catholics in Northern Ireland have essentially boycotted the police force.

Many have refused to become officers or even report crime, relying instead on informal networks within their own communities to settle disputes and address crimes.

Sinn Fein's vote clearly suggested that party members were willing to swallow their bitter feelings and cooperate with police for the sake of peace. But many also said that the province's Catholic minority would begin to trust the police only if officers gave them fair and legal treatment.

"They are going to have to earn it," Martin McGuinness, another senior Sinn Fein leader, said in a speech to party members. "We have to make them realize that they must be the servants of the people and not the other way around."

Paul Butler, a Sinn Fein member and former IRA prisoner, told party members that he supported the vote even though he had been "brutalized by the police," according to the Irish Times.

"It is difficult for me to make a decision because of my personal experiences of policing," he said. But he added, "Those who want maximum change must be prepared to take maximum risks."

Former Salvadoran Foes Share Doubts on War

Fifteen Years Later, Problems of Poverty Remain at Forefront

By Manuel Roig-Franzia
Washington Post, 29 January

SAN MIGUEL, El Salvador -- José Wilfredo Salgado says he collected baby skulls as trophies in the 1980s, when he fought as a government soldier in El Salvador's civil war. They worked well as candleholders, he recalls, and better as good-luck charms.

In the most barbaric chapters of a conflict that cost more than 75,000 lives, he enthusiastically embraced the scorched-earth tactics of his army bosses, even massacres of children, the elderly, the sick -- entire villages.

It was all in the name of beating back communism, Salgado, now the mayor of San Miguel, said he remembers being told.

But as El Salvador commemorates the 15th anniversary of the war's end this month, Salgado is haunted by doubts about what he saw, what he did and even why he fought. A 12-year U.S.-backed war that was defined at the time as a battle over communism is now seen by former government soldiers such as Salgado, and by former guerrillas, as less a conflict about ideology and more a battle over poverty and basic human rights.

"We soldiers were tricked -- they told us the threat was communism," Salgado said as bodyguards with pistols tucked into their waistbands hovered nearby at his home, ringed by barbed wire. "But I look back and realize those weren't communists out there that we were fighting -- we were just poor country people killing poor country people."

Salgado said he once thought that the guerrillas dreamed of communism, but now that those same men are his colleagues in business and politics, he is learning that they wanted what he wanted: prosperity, a chance to move up in the world, freedom from repression.

All of which makes what they see around them today even more heartbreaking and frustrating. For all their sacrifices, El Salvador is still among the poorest countries in the Western Hemisphere -- more than 40 percent of Salvadorans live on less than $2 a day, according to the United Nations. The country is still racked by violence, still scarred by corruption. For some the question remains: Was it all worth it?

"We gave our blood, we killed our friends and, in the end, things are still bad," said Salgado, who has served three terms as mayor of El Salvador's second-largest city. "Look at all this poverty, and look how the wealth is concentrated in just a few hands."

North of Salgado's home, the guerrillas he once fought live with the same doubts. Speeding along the curvy mountain roads near the onetime rebel stronghold of Perquin one recent afternoon, former guerrilla Benito Chica Argueta lamented that the future didn't turn out as he'd hoped.

Today, he scrapes together a living any way he can: Sometimes he sings at parties, sometimes he sells firewood. Zipping past a few sturdy masonry houses that appeared out of place alongside flimsy shacks, he quietly observed that such luxuries were beyond his reach.

"Those are people who get money sent from their relatives working in the United States," he said. "They're the only people around here who can afford a nice house."

Miles from those nice homes, he parked and hiked through a craggy ravine, grabbing vines to steady himself as he worked higher and higher up the Cacahuatique Mountains. At the end of the ravine, he reached a cave. Inside, bats skittered through the cool darkness that was his refuge as a scared young guerrilla. It still feels like a safe place to him.

Chica Argueta, who maintains the pencil-thin mustache he wore as a young rebel, once trudged through a shallow stream to get there, so that he wouldn't leave footprints that would give away the location of the guerrillas' Radio Venceremos -- Radio We Will Be Victorious. Now he'll take anyone there for a few dollars.

In a honeyed voice that once crooned revolutionary anthems, Chica Argueta, now 46, said his guided visits are part of an effort to build a tourist industry on the relics of El Salvador's civil war -- one of the first such endeavors in Central America. But something else is at work. He is trying to secure his guerrilla movement's place in history.

Even though some factions of the coalition of guerrilla armies that fought in El Salvador's civil war were Marxist, he said, ideology had nothing to do with his decision to take up arms and leave the farm where his father earned only a few colones for backbreaking work. Nor did ideology play a role in motivating his friends in the People's Revolutionary Army -- one of five guerrilla factions during the war -- that he served with in the northern Morazan region, he said.

He remembers fighting "for a piece of land, for the chance that my children might someday get to go to the university."

The Reagan administration, fearing a communist uprising, built up El Salvador's military with weapons, training and hundreds of advisers to serve as a surrogate force against what it described as encroaching Soviet and Cuban influence in Central America. To this day, Chica Argueta seethes when he recalls the sight of U.S. planes, knowing that they were there to fight a communist threat that he believes was overblown.

The war's degeneration into senseless malice was seared into Chica Argueta's mind in a tiny mountain town called El Mozote. In December 1981, a U.S.-trained battalion of government troops tortured and executed about 500 villagers there; the names of dozens of victims -- many under the age of 2 -- are now etched on the wall of the rebuilt church.

Chica Argueta and his fellow guerrillas arrived in El Mozote several days after the massacre and, fearing a return of the soldiers, hurriedly buried the dead beneath a thin layer of adobe bricks. Salgada arrived months later, after rains had unearthed the corpses, and piled skulls into sacks as souvenirs. He had "lost his love of humanity," he recalled, but a kernel of doubt was forming. He was conflicted, as he is today.

Salgada kept the skulls for years. They were reminders of how deeply he had sunk into depravity, yet somehow they also represented his awakening, he said. Witnessing the aftermath of what his colleagues did in El Mozote and reflecting on those skulls changed his mind about how the war was being fought. He might still have the skulls, he said, if not for the new family and the new life he has forged.

"Could you imagine the nightmares my children would have if I kept them in the house?" he said.

Salgada's mentor, the vaunted Col. Domingo Monterrosa, ordered the attack in El Mozote, which Salgada said he now considers "a genocide." Yet Salgada displays a huge painting of himself and Monterrosa -- who was killed during the war -- in the foyer of San Miguel City Hall. Perhaps it will make people ask questions about the war, Salgada said, though he's sure "people hate me" for displaying it.

If Monterrosa had lived, Salgada said, he should have been prosecuted for "war crimes like a Hitler." But he tempered his historical indictment, saying that "those were different times."
The scars of what he and his compatriots did, of the horrors of their brand of war, linger. Just two years ago, on a bridge in San Miguel, Salgada encountered a former government soldier who appeared to believe the war was still underway. He saluted Salgada and told him he had secured the bridge so that rebels couldn't cross, even though the war had been over for more than a decade.

"These are old wounds," Salgada said. "These anniversaries just open them wider."

Salgada and Chica Argueta now share a point of view, a common phenomenon in El Salvador today, where former soldiers and guerrillas often work together and intermarry. Chica Argueta said he believes the intermingling of former enemies was made possible by peace accords signed in 1992 without declaring a loser, thus leaving the guerrillas and the government soldiers on an even plane.

While Salgada and Chica Argueta struggle with doubts about the war, El Salvador's ruling party, the Nationalist Republican Alliance, or ARENA, presents a less nuanced image. ARENA prides itself as a bulwark against communism. The party's official hymn, sung often at political and government gatherings, boasts that "El Salvador is the tomb of the red ones," a reference to communist sympathizers.

Walter Araujo, an ARENA stalwart who is president of El Salvador's Supreme Court and former head of the party, said in an interview that the civil war "put up a barrier against communist expansion. . . . To say communism wasn't a threat at that time would be to deny history."

Araujo is quick to point out that some rebel factions received support from Fidel Castro in Cuba and Daniel Ortega's Sandinista government in Nicaragua. And those countries might have played an outsize role in shaping El Salvador if the war had ended differently, Araujo said.

"We would have suffered the same fate as Nicaragua if there had been a victory by the left," Araujo said.

Today, Araujo and others describe what they portray as a similar threat -- the rise of populist socialist movements in Latin America -- and worry that El Salvador once again will be swept up in a bitter ideological fight.

"The risk has resurged," Araujo said.

A group of former guerrillas watched Araujo speak on television a few days before the Jan. 16 anniversary of the peace accords and scoffed at his comparisons between the present and the civil war era. On the patio of a small hotel in Perquin, where a civil war museum promotes the guerrilla version of history, they fretted that their struggle is still misunderstood.

The conversation drifted toward their disappointments about postwar El Salvador: the continued mass migration to the United States by Salvadorans who cannot find work at home, their fears about violence in a country with one of the highest murder rates in the world, their worries that the government isn't doing enough to address either problem.

"We have no historical memory here in El Salvador -- has everyone forgotten what we fought for?" said Adolfo Sanchez, a 47-year-old former guerrilla whose left arm is several inches shorter than his right because a bullet obliterated his elbow.

Then Sanchez paused. A smile grew on his face.

"You know," he said, "before the war we never could have sat here, right out in the open, and said such things."

Maybe, they all agreed, it had been worth it after all.

Iranian Reveals Plan to Expand Role in Iraq

NYT, January 29
By JAMES GLANZ

BAGHDAD, Jan. 28 — Iran’s ambassador to Baghdad outlined an ambitious plan on Sunday to greatly expand its economic and military ties with Iraq — including an Iranian national bank branch in the heart of the capital — just as the Bush administration has been warning the Iranians to stop meddling in Iraqi affairs.

Iran’s plan, as outlined by the ambassador, carries the potential to bring Iran into further conflict here with the United States, which has detained a number of Iranian operatives in recent weeks and says it has proof of Iranian complicity in attacks on American and Iraqi forces.

The ambassador, Hassan Kazemi Qumi, said Iran was prepared to offer Iraq government forces training, equipment and advisers for what he called “the security fight.” In the economic area, Mr. Qumi said, Iran was ready to assume major responsibility for Iraq reconstruction, an area of failure on the part of the United States since American-led forces overthrew Saddam Hussein nearly four years ago.

“We have experience of reconstruction after war,” Mr. Qumi said, referring to the Iran-Iraq war in the 1980s. “We are ready to transfer this experience in terms of reconstruction to the Iraqis.”

Mr. Qumi also acknowledged, for the first time, that two Iranians seized and later released by American forces last month were security officials, as the United States had claimed. But he said that they were engaged in legitimate discussions with the Iraqi government and should not have been detained.

Mr. Qumi’s remarks, in a 90-minute interview over tea and large pistachio nuts at the Iranian Embassy here, amounted to the most authoritative and substantive response the Iranians have made yet to increasingly belligerent accusations by the Bush administration that Iran is acting against American interests in Iraq.

President Bush has said the American military is authorized to take whatever action necessary against Iranians in Iraq found to be engaged in actions deemed hostile.

The Iranian ambassador abruptly agreed to a longstanding request for the interview — made repeatedly after the first American seizure of Iranians here on Dec. 21 — and seemed eager to rebut the accusations.

The political and diplomatic standoff that followed the Dec. 21 raid until the Iranians were released nine days later has contributed, along with a dispute over the Iranian nuclear program, to greatly increased tensions between the United States and Iran. This month, American forces detained five more Iranians in a raid on a diplomatic office in the northern city of Erbil.

While providing few details, the United States has said that evidence gleaned in the Baghdad raid, made on an Iraqi Shiite leader’s residential compound, proves the Iranians were involved in planning attacks.

How much direction, if any, Mr. Qumi was taking from his government was unclear in the interview, in which he showed disdain for the American accusations as well as a few flashes of restrained sarcasm.

He ridiculed the evidence that the American military has said it collected, including maps of Baghdad delineating Sunni, Shiite and mixed neighborhoods — the kind of maps, American officials have said, that would be useful for militias engaged in ethnic slaughter. Mr. Qumi said the maps were so common and easily obtainable that they proved nothing.

He declined to say whether he believed the maps bore sectarian markings or address other pieces of evidence the Americans said they had found, like manifests of weapons and material relating to the technology of sophisticated roadside bombs. But that is not why the Iranians were in the compound, he said.

“They worked in the security sector in the Islamic Republic, that’s clear,” Mr. Qumi said, referring to Iran. But he said that the Iranians were in Iraq because “the two countries agreed to solve the security problems.” The Iranians “went to meet with the Iraqi side,” he said.

In a surprise announcement, Mr. Qumi said Iran would soon open a national bank in Iraq, in effect creating a new Iranian financial institution right under the Americans’ noses. A senior Iraqi banking official, Hussein al-Uzri, confirmed that Iran had received a license to open the bank, which he said would apparently be the first “wholly owned subsidiary bank” of a foreign country in Iraq.

“This will enhance trade between the two countries,” Mr. Uzri said.

Mr. Qumi said the bank was just the first of what he said would be several in Iraq — an agricultural bank and three private banks also intend to open branches. Other elements of new economic cooperation, he said, include plans for Iranian shipments of kerosene and electricity to Iraq and a new agricultural cooperative involving both countries.

He would not provide specifics on Iran’s offer of military assistance to Iraq, but said it included increased border patrols and a proposed new “joint security committee.”

Any Iranian military assistance to Iraq would be fraught with potential difficulties. Aside from provoking American objections, such assistance could further alienate Sunni Arabs, many of whom already suspect that Iran, overwhelmingly Shiite, is encouraging Iraq’s Shiite-led government in persecuting them.

A number of American and Iraqi officials said Sunday that it was difficult to respond to Mr. Qumi’s statements until they had been communicated through official routes. A spokesman for the American Embassy in Baghdad, Lou Fintor, declined to address the statements.

Sean McCormack, a State Department spokesman, said Sunday that the United States had a significant body of evidence tying Iran to sectarian attacks inside Iraq. “There is a high degree of confidence in the information that we already have, and we are constantly accumulating more,” Mr. McCormack said.

He did not address any of the specifics of Mr. Qumi’s comments about plans for stronger economic and security ties, but said that Iran currently plays “a negative role in many respects” in the country.

Iraqi officials also said that they could not comment on specific programs until they had seen the details, but expressed a range of views on the wisdom of expanding ties with Iran.

“We are welcoming all the initiatives to participate in the process of reconstruction,” said Qasim Daoud, a former national security adviser who is now a secular Shiite member of Parliament.

“My belief is that our strategic alliance is with the Americans, but at the same time we are
looking for the participation of any country that would like to participate,” Mr. Daoud said.

Barham Salih, a deputy prime minister who is Kurdish and whose duties include economic matters, took sharper issue with Mr. Qumi’s criticism of the American presence.

“Iraqi national interest requires seeking good neighborly relations with Iran as with other neighbors, but that requires respect for Iraqi sovereignty,” Mr. Salih said.

Mr. Qumi spoke largely in Persian during the interview, but he occasionally broke into English when he wanted to be certain that a point had been conveyed forcefully.

Although Mr. Qumi was not given specific questions before the interview, he was made aware of the general topics that would be covered and seemed prepared with detailed answers in many cases. He seemed keen to give his government’s view of what occurred in the early morning of Dec. 21, when American forces raided the Baghdad compound of Abdul Aziz al-Hakim, one of Iraq’s most powerful Shiite leaders, who had traveled to Washington three weeks before to meet President Bush.

Within the compound, the Iranians were seized in the house of Hadi al-Ameri, who holds two powerful positions: he is chairman of the Iraqi Parliament’s security committee and leader of the Badr Organization, the armed wing of Mr. Hakim’s party, which spent years in exile in Iran.
Although the Americans have suggested that the Iranians were providing support for militias like the Badr Organization, Mr. Qumi said that his countrymen were dealing with Mr. Ameri in his government capacity.

The Iranians would not even have stayed the night in the compound except, in a situation faced by many Baghdad residents, their business lasted beyond the early-evening curfew and they were forced to spend the night, Mr. Qumi said.

Mr. Qumi also warned the United States against playing out tensions in what he called “the nuclear file” in Iraq. “We don’t need Iraq to pay the cost of our animosity with the Americans,” Mr. Qumi said.

As the interview was breaking up, Mr. Qumi made one last stab at the Americans. If Iran is allowed to undertake reconstruction activities in Iraq, he said, all international construction companies would be welcome. “Urge the American companies to come here,” he said.

Abdul Razzaq al-Saiedi contributed reporting from Baghdad, and Mark Mazzetti from Washington.

A cut that may not heal

T T RAM MOHAN

ET, JANUARY 24

India’s fiscal deficit is falling faster than expected. That makes fiscal policy contractionary — as is appropriate in an economic expansion. The monetary authorities evidently think this is not enough. So, monetary policy is tending to be contractionary as well. The Reserve Bank of India (RBI) has responded to what it believes are signs of ‘overheating’ in the economy. With the inflation rate surging past 6%, the RBI may well think it necessary to press the brakes even harder. The decline in the fiscal deficit introduces an added compulsion. As banks have been big providers of savings to government, the decline in the deficit should reduce the government’s demand on banks and free more of their resources for lending. The RBI recognises this. That is why we have the planned ordinance that will give the RBI flexibility to lower the statutory liquidity ratio (SLR) below the current floor of 25%. However, with credit growing at 30%, the RBI would not like to abet such growth in any way. In reconciling the two requirements, the RBI has a challenge on its hands. The improvement in the finances of the Centre and the states promises to exceed expectations. There is every indication that the combined fiscal deficit of the Centre and the states for 2006-07 will end up much lower than the budgeted figure of 6.5%. The booming economy has made nonsense of the dire warnings of the fiscal pessimists. A falling deficit implies lower supply of government securities. At the same time, the savings rate seems to be rising. A lower government deficit itself implies a higher savings rate. Another sign is that the current account deficit for the year is now projected at 1.5% of GDP, lower than the earlier estimate of 2.5-3%. Given that investment in the economy appears to be going up, this also points to a rise in the savings rate. The two factors together — a lower supply of government securities and a larger pool of savings — will accentuate a trend seen in the last two years: a greatly diminished reliance on the banking system to finance government borrowings. That is the rationale for the proposed SLR cut. From the late nineties onwards, banks’ holdings of government securities increased way beyond the SLR — at its peak in April 2004, it was 42.7%. However, from 2005-06, banks have been liquidating their holdings of SLR securities in order to finance credit. This, of course, means that incremental credit/deposit ratio in the system has been 100%. The SLR in the banking system is now 29%. Going by the reduction in SLR achieved between FY 2005 and FY 2006, the SLR could touch 25% by March 2007. If the RBI cuts the SLR below 25% at that point or earlier, the incremental credit/deposit ratio at banks will continue to be 100%. But the RBI is uncomfortable with the rate of credit growth. So it could opt to retain SLR at 25% for some time. For the reasons mentioned above, this will spell excess demand for G-secs and depress yields on G-secs. Whenever the SLR cut is effected, yields will rise and expose banks to marked-to-market losses. This is hardly a desirable state of affairs. So, the SLR must be cut before long but this must not mean continuation of the present rate of credit growth. The two requirements can be reconciled only through a rise in interest rates — and indeed that is what many expect in the coming credit policy. If that happens, an SLR cut will not bring banks the promised relief.

Is it desirable at all to rein in credit growth in the present buoyant conditions? Yes, if we believe that there is systematic mis-pricing of credit risk. Mis-pricing of every kind of risk is a universal phenomenon today and it is the result of the global surge in liquidity. But the answer to under-pricing of credit risk is not to make credit more expensive across the board. That will adversely affect investment and lead to supply constraints down the road. The answer is to focus on segments of the banking system where credit risk is under-priced. If home loans are being under-priced, then measures specific to that segment (such as higher risk weights) are in order, not a generalised rate hike. The best way to ensure proper pricing of risk, as this column has long argued, is to ask banks to put in place systems to measure risk-adjusted return on capital for every borrower. If this return is lower than the threshold return on equity, the regulator knows that risk is being under-priced. In other words, the response to runaway credit growth must be microeconomic. It must be selective and it must not penalise those who are pricing risk correctly. Pushing and pulling macro-economic levers in the belief that there is ‘overheating’ in the economy will cost us dearly by derailing growth.

The author is professor, IIM Ahmedabad

Rage of the margins: Geography as key to NE

Sudheendra Kulkarni
Indian Express, January 28

For some people, geography shapes history. When geography changes, their destiny too changes — often for the worse, as can be seen in the case of the people of Assam and other Northeastern states. I had pointed out the anomaly of this region sharing only a 21 km border with the rest of India, whereas its border with Bangladesh is 1,829 km.

But take a closer look at India’s map, and another anomaly strikes you. The region, which was well-connected to the rest of undivided India, and also to South-East Asia, through the sea route before 1947, has no access at all to the Bay of Bengal. The southern tip of Tripura comes tantalisingly close to Chittagong, Bangladesh’s second largest port. But India deprived itself of an approach to it — and through it to the rest of the Northeast.

This was because the leaders of our freedom movement lacked the foresight and the assertiveness to stake a perfectly legitimate claim, during negotiations over Partition, on at least a part of Chittagong, whose glorious contribution to India’s freedom movement bears no elaboration here.

Result: Geography suddenly changed for our north-eastern compatriots. They became land-locked. Their traditional road, rail and river transportation system, running through East Bengal, also got completely disrupted. And the Northeast became a distant ‘margin’ in the eyes of ‘mainland’ India. Not surprisingly, some people in the region started to view “mainlanders” as “Indians” and themselves only as Mizos or Nagas or Kukis or Bodos or Assamese. What a tragedy!

I read with tears the following account in former Indian Express editor B.G. Verghese’s book, India’s North-East Resurgent, of the region’s isolation from the rest of the country: “...100-150 years ago, the Brahmaputra valley was in the vanguard of Indian development and globalisation. Its alluring and ever-expanding tea production and exports triggered a variety of investments with backward and forward linkages. The discovery of coal and oil in upper Assam had resulted in the development of mining and forestry. The region was a pioneer, an investment leader, a moderniser. It attracted capital and entrepreneurs... the Northeast was then a part of the mainland, a land of opportunity, an open economy well-linked with markets at home and abroad through Calcutta and Chittagong. This has been forgotten because things changed.”

We can hence see why Partition was an unmitigated disaster for Assam and the Northeast. Just as individuals feel restless when they are deprived of the open sky and the freedom to move and build relationships, communities too feel imprisoned when they are cut off from their natural neighbours and those with whom they interacted.

In Assam, this economic and geographical isolation was compounded by the influx of Bangladeshis, which is threatening the very identity and existence of Assamese. The vote-bank inspired insensitivity of the Congress led to Assamese anger finding dangerous vent in the ISI-backed ULFA.

In an insightful essay titled ‘The Margins Strike Back’, Prof Udayon Misra of Dibrugarh University writes: “Not only did the economy of Assam take a sharp downward slide, but one of the more significant aspects of this geographical isolation was the resurgence of the separatist mindset, which had remained submerged or sidelined during the freedom struggle.”

If isolation, influx of Bangladeshis, and externally-aided extremist violence are at the root of the turmoil, the solution must squarely address each of these causes. This is where we need to realise that Bangladesh, which has become the main source of the problem because of the rise of anti-India feelings fanned by Islamist forces there, has to be made a partner in solving it.

Partition was in many ways a disaster for the people of East Bengal too. The Muslim League’s bogus ‘Two-Nation theory’ had never found enthusiastic support there, and after 1947 it was hobbled with unnatural boundaries, surrounded by India on east, west and north. Much off Bangladesh’s backwardness is because of its cutting off from Mother India in 1947 and because Indian and Bangladeshi leaders failed to create an imaginatively co-operative architecture between the two countries.

However, we should not remain prisoners of the past, one that was a product of the colonial era in its dying moments. We should explore creative new ideas and bold new initiatives. This exploration will continue next week.

Red alert for the CPI(M)

Aloke Banerjee
HT, January 25

Singur and Nandigram have put the CPI(M) in a tight spot — not only in West Bengal but at the national level as well. Allegations that the party is maintaining double standards is haunting it everywhere. When Buddhadeb Bhattacharjee acquires land for industries, it is good as it is for ‘employment generation’. But then does it make sense when the CPI(M) resists Congress or BJP governments doing the same in their own states?

The CPI(M) meet in New Delhi in early 2005 had identified the main weakness of the party as its failure to grow out of the boundaries of West Bengal, Kerala and Tripura. The strategy was to oppose the Centre’s economic policies and intensify class struggle in other states, particularly in the villages. Accordingly, the CPI(M) sharpened its criticism of the Congress-led UPA government. But strangely, ever since Bhattacharjee came to power for the second time in West Bengal in 2006, the CPI(M)’s sting against the Centre lost much of its venom.

In the 2005 assembly elections in Hissar, Haryana, the CPI(M) had fielded the state secretary of the Centre of Indian Trade Unions (Citu) against the Congress candidate, Sajjan Jindal’s brother. The CPI(M)’s main slogan was: Jindals flout labour laws in their factories. Will the CPI(M) be able to raise such slogans any more after Bhattacharjee gave a red carpet welcome to the Jindal group to bag its steel plant project in the state? In 2002, the CPI(M) had bitterly criticised the Tata’s acquisition of 25 per cent share of the Videsh Sanchar Nigam Limited (VSNL). Will it be able to raise even a muffled voice after the Tata Motors controversy in Singur? In Dadri, the CPI has joined hands with V.P. Singh against the acquisition of land by the Uttar Pradesh government for the Ambanis. But the CPI(M) has not joined the fight. Is it because Bhattacharjee is eagerly pursuing the Ambanis for getting investment in the state?

If capitalism can cure unemployment, what is the utility of a Communist Party like the CPI(M)? The party will have to seek acceptable answers to such questions.

The strength of the CPI(M) in states other than West Bengal, Bihar and Tripura is abysmal. In Assam, the CPI(M) has only two MLAs. In Bihar it has one. In Jharkhand, the MLA strength is nil. In Karnataka, Madhya Pradesh, Orissa and Rajasthan it has an MLA each. In Maharashtra, the party has three MLAs, while in UP it has only two.

One Nandigram is giving enough trouble to the CPI(M) in West Bengal. Several more Nandigrams are waiting to happen. The government has plans to acquire 5,000 acres for the Salim Group at Kukrahati near Nandigram for a residential-cum-commercial complex. Two other ‘Salim townships’ are to come up at the Magrahat-Baruipur area and the Canning-Bhangore zone. Another 3,000 acres of land will be required to build the 100 km Eastern Link Highway. Several commercial blocks will be set up along the highway that will require another 1,000 acres of land. Several industrial estates will also come up over 400 acres of land. The Bhumi Uchhed Protirodh Committee, an umbrella organisation of all the Opposition parties, have already spread out to all these places and more to gear up for another round of ‘bloody resistance’.

For all the 42 years of its existence, the CPI(M) has been able to maintain its monolithic, disciplined structure. It is this belief that has so far helped the party to overcome serious differences. But the new generation of cadres is being exposed to a different ideology. They are growing up in an atmosphere vastly different from what their predecessors were exposed to.

All the veteran leaders had been jailed, beaten up by police for their struggle against capitalism. But for the new generation, red-carpet welcomes to industrialists, setting up shopping malls and expressways, travelling in cars are all acceptable. Even Left Front Chairman Biman Bose had to recently observe that if the agitation continues further and if the ideological moorings are allowed to be loosened even more, the CPI(M) could be doomed forever.

Email Aloke Banerjee: alokebanerjee@hindustantimes.com

Capitalism-Marxism brew

The Statesman, 28 January

Should we congratulate the West Bengal government for resolving one of the great dilemmas that caused so much trouble to the world in the 20th century - that is, the schism between capitalism and Communism? Ever since the Russian Revolution of 1917, it seemed that the divergence between the two ideologies would lead only to violence, war and bloodshed.And so it proved. The clash between those who believed in private enterprise and those who sought salvation in the “socialisation” of industry was aggravated as the century wore on. The early years of the Russian experiment inspired a whole generation of idealists with the tangible proof of the perfectibility of human society, while capitalism continued to wallow in depression, poverty and injustice.The future, it seemed, belonged to socialism, just as Marx had prophesied. The war against Nazism and Fascism, which allied the West with the Soviet Union, reinforced the idea that “progressive” forces were in the ascendant. After World War II, the formal decolonisation of the old European empires proceeded at an accelerating pace. Almost all these countries claimed adherence to a socialist ideology of social justice, the defeat of poverty and a degree of self-reliance. Capitalism yielded ground to these realities; and the Western democracies set up their welfare states, to attach to themselves populations which might have been tempted to vote for a socialism which, even in 1945, seemed to the “advanced” countries to be at least as likely to deliver the goods as a capitalism scarred by war, impoverishment and inequality. The fight between these two ideologies shaped the lives of the world’s people, sometimes as Cold War, sometimes ~ in Korea and Vietnam ~ as bloody and brutal conflict. There are few stories in history as dramatic and compelling as the rehabilitation of capitalism in the second half of the 20th century; so much so, that socialism crumbled and was swallowed up by the very injustice and inequality which had given birth to it. In the competitive struggle with the Soviet Union, capitalism created the consumer society - a rising standard of living that transformed Western society and re-landscaped it, so that it became a kind of parodic after-life which socialism could only dream of. In the process, the achievements of socialism looked drab, pinched and austere.

Little by little, the rest of the world opted for what had appeared in 1945 doomed and vanquished, and a regenerated capitalism swept all before it. The banners of socialism, tattered and faded, were consigned to the scrap-heap. I was in Addis Ababa in Ethiopia in 1991, when the dictator Mengistu, supported by the Soviet Union, was deposed. In a public park, I came across a pile of statues of Lenin and rusty metal red stars, the iconography of a fallen Communism reduced to chunks of broken masonry and twisted metal. For Communism was, and always had been, only a heretical version of industrial society. Marx never quarrelled with the industrialisation of the West ~ he had, as the Communist Manifesto attests, the greatest admiration for the “miracles” wrought by industrial society, which, in his view, overshadowed all the wonders of the ancient world.The quarrel was not with industrial society, but with capitalism, which distributed its rewards with such promiscuous disdain for the rights of humanity. For Marx, the ownership by the people of the means of production and distribution would be the solution to the injustices of capitalism; and it was this doctrine that set the destiny of the workers at odds with the fate of a capitalism which, Marx believed, would bring about its own ruin. It would be wrong to attribute any great novelty to the thinking of the ideologues of West Bengal in their re-hash of Marxism. Their capacity for original thought should not be over-estimated. They have been inspired by the Chinese Communists who, all too aware of the fate of their sometime Soviet allies, were too smart to lose control of power.They maintained the authoritarianism of Communism, and married it to a version of the free market. The spectacular runaway economic success of China is there for the world to see. It is this model that has inspired the leaders of West Bengal to mimic the Chinese version of Communism, which is no such thing. West Bengal has a democratically elected government, but so secure and self-confident has it become after three decades of unbroken rule, that it behaves as though governing were its natural right. And in consequence, it exhibits as little concern for human beings as the unelected ruling powers of its mentor, China. West Bengal therefore exemplifies, within India the mending of the old sectarianism of industrial society. There is no conflict between capitalism and Communism ~ the struggle, violence and bloodshed of the past were all in vain. There is now commitment only to a single form of industrialism. Capitalism has triumphed, and the West Bengal government acknowledges this by its actions, though its rhetoric may not yet be ready to fall in step. The breach is healed. There is no more conflict. Capitalism and socialism can lie down together, and of this monstrous pairing, who can tell what levels of injustice, inequality and cruelty may not be begotten? Will the efficiency of capitalism be joined to the justice of socialism, or will the ruthlessness of capitalism attach itself to the brutality of totalitarian ideology?

It is in this light that the melancholy events at Nandigram and Singur, and in all the other places marked out for “development” in West Bengal should be understood. It seems clear that West Bengal is in the process of getting the worst of both worlds. The leaders of the State project themselves as being in the vanguard of progress ~ what could be more progressive than China with its industrial might, the majesty of Pudong, the Three Gorges dam and all the other soaring paraphernalia of development?There is a flaw in this sunny second marriage of capitalism with communism. The fall of the Soviet Union revealed crisis in industrial society, but this was masked by the triumphalism of the West. We have won, they cried. Actually, they might just as plausibly have said the planet has lost.The weight of global, industrial society upon the earth becomes heavier by the day. The “footprint” of humanity threatens to smash the fragile globe beneath its industrial jackboot. The precious, irreplaceable riches of the world, including its waters and its forests, have all been transformed into raw materials. These are to feed an economic growth without end, because humanity, no longer limited by what it needs, has been set in an infinite chase after all that it desires.And because this is boundless, it will trample the constraints of a finite world with the same heedlessness as a flock of domestic animals trampling the hedge between pasture and crop. In the inexorable advance of this majestic progress, anyone who stands in its way will be destroyed. The message to humanity is don’t be a farmer, do not seek subsistence, do not be a herder or a nomad, do not be self-reliant, do not be an indigene, do not be a slumdweller, do not be poor or old or sick: if you are any of these things, you are dispensable, and will be compelled to make way for monuments to an industrialism, whose wealth and power are sustainable only up to the point where the resource-base of the earth collapses; a moment which draws nearer with each passing day. The people of Singur, Nandigram, Kalinganagar and all the other sites to be expropriated, are the only people standing in the way of these malevolent processes. They deserve the support of all who value the survival of humanity above the survival of capitalism; among whom, alas, the Communists no longer can be counted.

The author lives in Britain. He has written plays for the stage, TV and radio, made TV documentaries, published more than 30 books and contributed to leading journals around the world. email:yrn63@dial.pipex.com

PORTENTS OF FAMINE

D BANDYOPADHYAY
The Statesman, 28 January

The acquisition of land and eviction of the peasantry amounts to a death warrant for five lakh agricultural households in nine West Bengal districts.

Notwithstanding the Right to Information Act, the Government of West Bengal has been consistently refusing to come out with their current plan of “industrialisation”. Investigative journalists have been able to piece together facts from various sources to indicate that the government is bent upon acquiring 1,40,000 acres of agricultural land in nine districts of Bengal which include Hooghly (6247 acres), East Midnapur (37,297 acres), West Midnapur (26,134 acres), Darjeeling (Siliguri ~ 25,200 acres), North 24-Parganas (5743 acres), South 24-Parganas (13,318) acres), Howrah (26,500 acres), Nadia (365 acres), Jalpaiguri (161 acres). (Courtesy: Bibekananda Ray: Thus Capital: The Statesman, Dec. 17 & 18, 2006).

Never in the history of industrialisation of Bengal had such vast areas of agricultural land been ever taken at a time by the government for the purpose of setting up units by the private parties for private gain. The parties involved, as far as the information goes, are the Tata Group and their associates, the Salim Group and their associates, Videocon, DLF, Reliance Groups of both the brothers, the Chatterji Group, the Birla Group and their associates, Reshmi Cements and the Jindal Group and their associates. So far only these names have been identified by the journalists.

The question that arises is one of social cost benefit calculus. How much will the society gain by these capital intensive investments compared to the highly diffused distributive system of income under the current agrarian economic system? We are being told time and again that high value industrial products should take precedence over the low value agricultural productive system. Looking from the macro-economic point of view it may appear to be highly attractive. But what about the loss of income and productive wealth of a large section of the rural population?

Another point which is being touted loudly by the Chief Minister and his cohort of party and government functionaries is that there is no non-arable land available in West Bengal for such large-scale industrialisation. The Chief Minister is on record having said that only one per cent of the land in West Bengal is not cultivable and thereafter he posed a question whether the new industries would be located in the sky or on the ground.

The Chief Minister does have many prerogatives but he does not have any right to prevaricate facts. The total amount of uncultivable land in West Bengal, according to the statistics given by the Bureau of Applied Economics and Statistics of West Bengal, is a little over 18 per cent. In absolute terms it is over 1.5 million hectares which means merely 3.7 million acres. In the joint Midnapur district the total such land available is about 2.52 lakh hectares . In Purulia the figure is around 92,000 hectres. In Bankura and Birbhum districts the figures are 1.2 lakh and 98,000 hectares, respectively.

With so much of uncultivable land available in the backward districts of West Bengal which are geographically not very far from Kolkata, how could the Chief Minister so brazenly make an incorrect statement that no uncultivable land was available for the purpose of industrialisation?

One aspect of this large-scale acquisition of agricultural land would be serious loss of foodgrain production. The average cereal output in West Bengal is a little over one tonne per acre. Thus in 1.4 lakh acres of land to be acquired the loss of production of foodgrain would be to the tune of 1.5 lakh tonnes.

The government would argue that it would not in any way affect the food security of the state. One can concede this point while taking a macro view of the situation. But the government should know that existence of foodstock does not and cannot prevent hunger and starvation death.

The family food security, which is the cardinal issue in the whole concept of food security, depends upon a family’s ability to buy food with their own income. With loss of livelihood of five lakh families and loss of land as well as shelter they would not have adequate income after a while to access food however much they might be available in the fair price shops or in the cereal mandis.

Did not Amartya Sen point out that in the great Bengal famine of 1943 it was not the absence of stock of food but inability of the households to access such food through their own income (entitlements) that 3 to 4 million men, women and children died mostly on the pavements of what was then Calcutta city due to hunger and starvation?

The print media reports indicate that the government has a much larger plan of acquiring more land than 1.4 lakh acres and these would all be agricultural lands. Since they are not thinking of going to the backward districts where uncultivable lands are available, no one knows how many more families would be involved in such eviction. If this phenomena continues, the state will gradually move towards the same situation as was witnessed during the Great Bengal Famine in 1943.

Eviction of peasantry on such a large scale will doubtless have a very deleterious effect on the social order. We have our own Naxalite problem arising out of landlessness and food insecurity. The world has witnessed the Zapatatista movement in Mexico and similar such movements in a lesser degree in various Latin American countries. The whole of Europe suffered from Jacqueries throughout the Middle Ages till the French Revolution which did not bring peace to any of the Kings and Emperors of different countries of that continent.

If in their blind rush to appease and to seduce private investors in West Bengal the CPI-M government would like to promote peasant uprisings, it would be their choice. They should not forget that with the mounting hunger and starvation what their policy would ultimately lead to. They will not remain very safe and secure within the sheltered premises of the Writers’ Buildings in Kolkata.

The author was secretary to government of India, ministries of finance (revenue) and rural development and executive director, Asian Development Bank, Manila.

Someone (Other Than You) May Own Your Genes

NYT, January 28
DENISE CARUSO

THE Food and Drug Administration’s recent declaration that food from cloned animals is safe was a fresh reminder of how poorly the biotech industry and its regulators have managed the field’s portfolio of innovation over the years.

A recent survey found that Americans overwhelmingly distrust government and industry to provide truthful information about biotech’s risks and safety. Yet equally important as risk — and more often overlooked — are the public’s equally real and unaddressed concerns about who is looking out for its interests as the genes of plants, animals and microbes, as well as entire organisms, become privatized through the patenting system.

Stephen Hilgartner of Cornell University said he believed that the economic and political challenges surrounding these so-called life patents would come to rival those of biotech risk, and he has come up with a sensible framework for starting a new conversation about them.
From the moment the first biotech patents were granted in 1980, the industry was hailed as a new frontier — uncharted territory where a new generation of scientist-inventors could reap the traditional rewards of innovation.

But even as the gold rush began, critics as varied as scientists and human rights advocates declared that biotech’s new intellectual property frontier was already occupied. Claims of novelty and innovation as the basis for life patents, they said, disregarded the realities of not only nature, but also of research practices, democratic decision-making and global governance.

These realities led Mr. Hilgartner, an associate professor in Cornell’s science and technology studies department, to think about how society might deal with biotech discoveries outside the strict economic imperatives of intellectual property law.

The title of an intriguing paper he wrote on the subject, “Acceptable Intellectual Property,” is a wordplay on the well-known concept of “acceptable risk” — that is, the level of risk a society considers acceptable, given existing social, economic and cultural conditions.

In other words, what level of intellectual-property protection is society — not the biotech industry or its phalanx of patent lawyers — willing to accept in exchange for the benefits of biotechnology?

With this question in mind, Professor Hilgartner began to investigate whether legal theories of real property, rather than innovation, might be a more useful way to think about who owns biotech inventions and what can be done with them.

He notes that the law frames the ownership of property as a bundle of rights. People who “own” real estate actually own a set of expectations, relationships and obligations to various communities and regions.

Depending on the communities’ rules, property owners may not be able to drill for oil, cut down trees or build new structures without permission, for example. They are obliged to prevent dangerous conditions, to pay for damages if they don’t, and so forth. Communities are accountable in various ways to property owners as well.

In contrast, there is no analog to this network of obligations for a patent holder. As Tim Hubbard, a Human Genome Project researcher, noted at a 2001 conference: “If you have a patent on a mousetrap, rivals can still make a better mousetrap. This isn’t true in the case of genomics. If someone patents a gene, they have a real monopoly.”

This monopoly gives patent holders total control over patented genetic materials for any use whatsoever — whether for basic research, a diagnostic test, as a test for the efficacy of a drug or the production of therapies.

Professor Hilgartner said patents don’t just determine who will own new technologies and who has access to them. They also influence what technologies cost, whose cultural and ethical values they represent, and what aspects of the research and development process will be transparent — and to whom.

The degree of control that life patents grant their owners is of growing concern to scientists, human rights and patient advocates and ethicists. More than 20 percent of human genes have already been patented, and most of those patents are owned by corporations.

Professor Hilgartner noted how this kind of control can play out in the real world. In the case of the Canavan disease patent, for example, a family afflicted by this rare genetic disorder initiated an effort to find the gene mutation responsible for the disease. They raised money, collected DNA samples and attracted researchers to the cause.

After a researcher found the gene in the late 1990s, he and his employer, Miami Children’s Hospital, patented it and began charging royalties on a genetic test to screen for the disease — despite the fact that they would never have found the gene without the efforts and the DNA samples of the afflicted.

Patient groups filed suit in 2000, contending misappropriation of trade secrets by using their children’s DNA without consent to obtain a patent. It took until 2003 for the parties to reach a confidential settlement; it allows certain laboratories to continue collecting royalties but lets institutions, doctors and scientists use the patented gene sequences without paying.

There are many other examples of life patents causing public concern. One of the most important examples involves patents on food crops and cloned animals. These patents have a growing potential to cede control of the world’s food supply to biotech patent holders.

Important questions must also be answered about who can legitimately “own” or control our personal genetic information. And no one has yet been able to address economic, social and legal questions raised by the patenting of genetic resources taken from developing countries.

This month, for example, Peruvian farmers protested against the biotech giant Syngenta, which genetically modified a common potato variety so that the potatoes are sterile unless a chemical is applied.

Risk concerns aside, farmers say they want to know why the company can charge a premium for adding a few new genes to a potato variety — yet they cannot, in turn, demand a royalty from Syngenta for using the “property” that they and their ancestors have been “genetically modifying,” by traditional means, for centuries.

Biotech companies are also amassing huge patent portfolios by tapping the genetic diversity found in volcanoes, rain forests and deep sea hydrothermal vents. They collect DNA from micro-organisms they find, patent it, and sell access to the gene sequences to pharmaceutical, agricultural, chemical and industrial companies.

Only rarely do such companies voluntarily work with indigenous communities to come to mutually agreeable terms for these kinds of activities. There has been much international protest as a result, but very little concrete action to change the situation.

These concerns may sound like the nattering of nabobs to those who believe the present system of protecting intellectual property is acceptable. But like it or not, a large and powerful infrastructure has declared that patents are crucial for getting discoveries out of the lab and into the market, and it will not change on its own.

NEVERTHELESS, that does not change the larger reality that Professor Hilgartner describes: that decisions about intellectual property are about much more than simply finding ways to stimulate and reward innovation.
They directly affect what technologies make it to the marketplace. They determine who is accountable for biotech products and processes, under what circumstances, and how they affect everyone.

Shifting the terms of the debate from patents and innovation to the rights-based framework that Professor Hilgartner has proposed may not be an immediate solution. But it is certainly the most direct route to a more democratic and inclusive conversation about intellectual property concerns as biotech marches on.

Denise Caruso is executive director of the Hybrid Vigor Institute, which studies collaborative problem-solving. E-mail: dcaruso@nytimes.com.