
About: the world this week, 11 February 2024 to 17 February 2024; Israel rescues; Elections results in Pakistan, and Indonesia; India negotiates prisoners with Qatar; 1% of India’s farmers agitate; and India’s Electoral Bonds Scheme is struck down.
Everywhere
This week, Israel rescued two hostages in a deadly stealth operation in Rafah, Southern Gaza. This is the first successful rescue mission since the 7th October massacre of Israelis by Hamas Terrorists and should be a huge boost to Israel’s ‘lonely’, relentless efforts to bring home all the hostages kidnapped on that fateful day. There are about 130 of them still out there.
After Israeli intelligence identified a building in Rafah in which two hostages were held, Elite Commandos stormed a house and extracted the hostages after killing three terrorists guarding them. Within minutes, the Israeli Air Force carried out a massive air-strike providing cover for the hostages to be safely taken to an armoured vehicle and then onto a waiting military helicopter. The two Israeli hostages rescued were Fernando Simon Marman, 60, and Louis Har, 70, who were ‘taken’ from Kibbutz, Nir Yitzhak.
Israel also discovered a baffling network of the ‘signature tune’ Hamas underground tunnels beneath the headquarters of the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA), which served as a command centre for the terrorists and also held the hostages. This is another damning find on the Hamas-complicit actions of UNRWA operating for decades in the Gaza Strip. Later, Israel promptly blew-up the Headquarters!
The final results of last week’s General Elections in Pakistan were out, amid reports of massive rigging and delays in counting of votes due to multiple reasons that’s possible only in Pakistan. The Election was dubbed as the most rigged (in favour of PML-N) election in the history of Pakistan. And the first reaction, to the outcome, is that this is something the Pakistan Army would not like at all.
Neither former Prime Minister (PM) Nawaz Sharif’s Pakistan Muslim League-Nawaz (PML-N) with 75 seats, nor the Pakistan Peoples Party (PPP) of Bilawal Bhutto Zardari, son of assassinated former premier Benazir Bhutto, with 54 seats won enough seats to form a government on their own. Independent candidates backed by former PM Imran Khan represent the largest group, with 93 of the 264 parliamentary seats declared.
The results shocked many, who had expected the showing of Imran Khan’s supporters to be severely dampened by an intense crackdown on Imran Khan and his party. But Khan cannot become PM as he is in jail and his grouping cannot form a government as they nominally ran as independents as his party the Tehreek-e-Insaf (PTI), was barred from contesting the Elections. Analysts think the election results indicate voters’ protest against perceptions of the country’s powerful military’s involvement in politics, which, of course, the military denies. That adds to the political instability, given the military’s strong historic role in the security and foreign affairs of Pakistan.
“Pakistan has been on a slippery slope for some time but a mild one. The slope is now much stiffer,” said a South Asia expert. “The military will most likely be able to manage the situation for some time, but the political situation is likely to be less and less stable”.
Former PM Shehbaz Sharif-Nawaz Sharif’s brother-is likely to lead a coalition that is being stitched together, as the new Prime Minister of Pakistan.
Now, on to another Election, this time in Indonesia.
Unofficial tallies in Indonesia’s Presidential Election show Defence Minister Prabowo Subianto taking a commanding lead. An official result is not expected until several weeks after the vote.
Prabowo Subianto, 72, is in pole position to be Indonesia’s next leader. He is a former special forces commander, and in recent times has cultivated the persona of a more charismatic statesman than the fiery, pious nationalist he earlier portrayed. He is from an elite Indonesian family and once the son-in-law of late Indonesian strongman dictator, President Suharto.
Subianto was dismissed from the military amid speculation of rights abuses, exiled in Jordan, and once banned from the United States over his alleged dark past. He is also accused of involvement in the kidnapping of student activists in 1998 and human rights abuses in Papua and East Timor.
Subianto lost in the previous two Presidential Elections to incumbent Joko Widodo who is hugely popular, but unable to run for a third term, in keeping with the ‘maximum two terms’ rule of the Constitution. In a patch-up, Subianto joined the government and has Joko Widodo’s tacit backing, with the President’s 36 years old son as his running mate and a possible Vice-President.
This week, Indian diplomacy was at its negotiating best when India convinced Qatar to release eight former Indian Navy personnel who were sentenced to death: seven returned to India this week and the remaining one is expected soon, after clearing certain legal formalities. The former navy personnel, working for a company in Qatar, were arrested on spying charges, and after a secret trial, handed the death sentence by a Court in Qatar. India then got the death sentence commuted to life imprisonment before pulling-of this stunning victory. And the process was lubricated by a special pardon by Qatar’s Ruler, Emir Tamim bin Hamad al-Thani.
This week, India saw a bumper agitation by a section of its farmers, taking off from where they left the proceedings over two years ago.
There are about 9 crore farmers in India, of which about 10 lakh are in the State of Punjab. This, barely 1%, is a ‘disgruntled’ lot owning the best branded cars in the world and reaping every benefit offered by India’s Government (GOI), such a free-electricity, highly subsidised fertilisers, open-ended procurement of wheat and paddy, among other things: a pampered lot! Well that doesn’t seem to be enough. They want more, and this week they began protests.
Over 250 farmer associations from Punjab, Haryana, and western Uttar Pradesh began a ‘Chalo Delhi’ march on their high-end cars, ‘fortified tractors’ and the kind, armed with a list of demands, raising tensions at Delhi borders. The GOI in turn set up riot control teams standing guard behind barricades on highways leading into the national capital, where police have prohibited large gatherings.
Farmer unions are seeking guarantees, backed by law, which they want the GOI to fulfill. What are they?
Minimum Support Prices (MSP) for 23 crops should receive a statutory legal backing; MSP should be fixed at above 50% above the comprehensives cost of production- actual cost incurred to grow crops and assumed values of other items such as family labour; Farm Loan waivers; Pension – about INR 10,000 per month for farmers over 60 years old; and pulling out of the World Trade Organisation (WTO).
The MSP, which is the cost at which the GOI purchases crops from farmers, provides farmers with an assured income for their produce. This price acts as a safety-net ensuring farmers receive a fair price, particularly during times of market uncertainties and fluctuations or when market prices fall below the MSP. Of the 23 crops that the government currently announces MSPs for every year, there are seven cereals-paddy, wheat, maize, bajra, jowar, ragi, and barley; five pulses-chana, arhar, moong, urad and masoor; seven oilseeds-groundnut, soybean, rapeseed-mustard, sesame, sunflower, niger seed, and safflower; and four commercial crops-sugarcane, cotton, copra, and jute.
However, while MSP is announced for all crops it works mainly for rice and wheat, because the GOI has a vast storage system for only these grains that feed the GOI’s Public Distribution System (PDS). The GOI often ends up buying twice the amount needed for a buffer stock.
The issue is best understood through the political economy of Punjab, the most prosperous and fully irrigated agriculture system in the country. There are years when the procurement in Punjab, especially paddy has exceeded the production in the state. As paddy comes from other States- Uttar Pradesh and Bihar-to be sold in Punjab as the market price is often 15-25% below the MSP in these states and there is hardly any procurement in the home states. And everyone in the grain procurement network benefits and profits from the system: Commission Agents charge 2.5% commission; Punjab Govt charges 6% Mandi fees and other cess. The bill is footed by the GOI for the Food Security Programme which is executed by the Food Corporation of India (FCI).
Punjab farmers have high productivity of paddy and wheat and use high doses of subsidised fertilisers. But their prices are constrained, especially when exports are banned and stocking limitations are imposed. The FCI also unloads wheat and rice at prices below their economic cost to bring down market prices on par with MSP or even below so that they can procure enough grains at ‘easy costs’. The GOI policy is biased towards urban consumers at the cost of farmers.
If the GOI policy does not allow the markets to operate especially when market prices are higher than MSP farmers stand to lose. So they clamour for higher and higher MSP based on unrealistic comprehensive costs. The difference between what farmers want and the GOI’s current cost calculation for MSP is about 25-30% in most crops. In the long run farmers stand to lose if they do not adapt to the ‘free’ market pricing of the simple ‘demand and supply’ mechanism.
Agricultural scientist and this year’s Bharat Ratna (India’s highest civilian award) winner, late Dr M S Swaminathan, called the Father of India’s Green Revolution, recommended that the GOI fix MSPs for farm produce based on a comprehensive measure of cultivation costs – weighted average cost of production – that includes the input cost of capital and the rent on the land (called ‘C2’ ) + 50% of C2, to give farmers 50% returns, rather than a narrower measure that takes into account the direct costs- out-of -pocket expenses incurred by the farmer and the value of family labour ( called ‘A2+FL’ ), which the GOI uses.
The M S Swaminathan Committee, established to recommend farm policy through the National Commission on Farmers, submitted its final Report in the year 2006. And the MSP calculation methodology was not readily accepted by the then GOI headed by Economist Prime Minister Dr Manmohan Singh, as it was considered irrational, untenable, and unviable and would probably distort the market. And there were aspects of the comprehensive costs that were not ‘comprehensively’ defined.
Ashok Gulati, India’s most respected Agri-economist argues that agreeing to the framers demands means fiscal stability will go for a toss, food inflation will rise, and no Government can afford to accept these demands. He suggests farm income augmentation should be through diversification to high-value crops and livestock. And the Punjab farmers should come out of cultivation of only staple crops, and tap exports.
In 2021, when the year-long protest by farmers pushed the present GOI to repeal some farm laws, designed to deregulate vast agricultural markets, the GOI said it would set up a panel to find ways to ensure support prices for all farm produce. Farmers accuse the GOI of going slow on that promise and also not achieving a GOI stated goal of ‘doubling farm incomes by 2022-23 (over a base of 2015-16).
The GOI is in talks with the agitating Farmers and some ‘minimum’ results are expected in the upcoming week.
Meanwhile-to get a hang of the situation-a farmer in down South Karnataka State had this to say: “MSP of paddy is INR 2,204 per quintal; the market price near Mysuru is INR 3,000 per quintal; Last week I sold 10 quintals of paddy at INR 3,100 per quintal to a buyer in Nanjangud (a Town in Mysuru district). Why are farmers protesting in Punjab?”
In a historic judgement this week, India’s Supreme Court struck down as unconstitutional the Electoral Bond Scheme introduced by the Government in 2018. This allowed anonymous corporate contributions to Political Parties through the State Bank of India (SBI) – the only bank authorised to issue these bonds. There is not limit on the amount and an existing corporate limit was removed to facilitate the flow of ‘unlimited’ funds. Further, the contributions did not attract income tax. The GOI’s stated intent was to curb black money in Elections and bring ‘transparency’ in Electoral Funding. And by not revealing names, any political harassment was sought to be avoided. However, the Court said this could be quid pro quo for future benefits and that the citizen has a right to know the donations coming-in to a Political Party. On the other side, ‘right to privacy’ of Corporate Houses is in jeopardy.
The SBI has been ordered to stop issuing these bonds forthwith, and furnish details of contributions received for publication on the Election Commission of India’s website by 13 March 2024. Parties which received the funds have been ordered to return un-encashed Electoral Bonds to the donors.
More bonding stories coming-up in the weeks ahead. Vote for World Inthavaaram.







