Opinion
Art of constructive destruction
29 Jun 2010 |
Dr Leena Srivastava
| Financial Chronicle
The vulnerability of ecosystems, and, therefore, human beings, has resulted in this enormous global effort being made towards tackling the problem of climate change. By themselves, temperature variations and climatic changes that are off the mean by a few degrees would not have meant very much if millions of livelihoods, and indeed lives, were not adversely affected. As such, it would be safe to say that this unprecedented global effort to fight climate change is about nurturing and protecting the vulnerable populations in the world. Why then did we choose to ignore the vulnerability of those businesses today that are contributing significantly to the emissions of greenhouse gases? If, indeed, the developed world has to bring down its emissions by at least 80 per cent of 2005 levels by 2050 - and the developing countries by a lesser amount - it does not require a genius to deduce that a number of businesses and activities would need to be closed or transformed radically.
The magnitude of the task ahead of the world - in particular, for the developed countries - is so huge that we tend to hide behind the comfort of statistics. Mitigation action, we assert, will not negatively impact GDP growth in OECD countries by more than 1 or 1.5 per cent. Undoubtedly, this is a lower cost than the cost of global adaptation that the developed countries should bear, but this is of little solace to the coal or oil industries, or the industries involved in the meat supply chains as so many others. The jobs lost in the affected industries would be more than made up by \'green\' jobs. Try telling that to the petroleum engineer who can engage in little else, but has a family to support and a personal pride to protect.
Margaret Thatcher - the Iron Lady of the UK - shut down the coal industry in that country. India, on the other hand, is seeking backdoor entry points to loosen the grip of the public sector on this industry and sneak in the private sector and market forces so as to bring some semblance of viability into its operations. The political challenges of changing a way of life are so daunting that even the governments with the strongest mandates would hesitate to venture in that direction. What the world urgently needs is models of constructive destruction - destruction that would give rise to other opportunities with little or no lags in skill re-setting, but on accelerated time scales. Sunset and sunrise industries have been part of the evolution of humankind over the last century-and-a-half, but it is the time pressure of change and its consequences, as well as the spread of industries that need to be transformed.
The most obvious example of constructive destruction that we can easily recall in recent times is that of the telecom sector. In a short period of 10 years, India has virtually thrown out the fixed line phone industry. The mobile phone industry that has taken its place has itself transformed 2-3 times with replacement of technologies and expansion of access taking place at lightning speeds, but at which no one bats an eyelid. Someone may have calculated the net greenhouse gas emissions of this transformation, but the example here is to draw attention to the confluence of technology developments, policy support, entrepreneurship, consumer demand, easy skill migration and effective regulation that provided an enabling environment for this to happen.
How can we ensure such constructive destruction takes place in other relevant sectors? One critical sector from the point of view of climate change is the power sector. In India, we are mostly dependent on coal - one of the most polluting greenhouse gas sources - for power generation. Some tentative first steps have been taken in exploring alternative renewable energy options for electricity generation with the announcement of the National Solar Mission, which targets a new capacity of 20,000 mw by 2020.
While targets signal some long-term directions, we need to identify the weak links in the creation of an environment that would facilitate a capacity expansion beyond targets. Is the technology in place? Early versions of mobile phones were elite products - not mass consumption products. Telecom regulatory systems underwent turmoil with the first chairman being summarily removed. The auctioning process of spectrum has been under intense scrutiny for some time now. But we have learnt and moved forward. Solar power is considered to be expensive today. The policy establishment and regulators seem to be willing to experiment. Industry is engaged. The unmet demand in this sector is so huge that the immediate need for skill migration is mitigated. Maybe India has already embarked on a second process of constructive destruction.
Seen to be poised as an emerging economy, placed between the developed and the developing world, India is watched as a living laboratory of experiments for social transformation. Our responsibilities today extend well beyond the boundaries of this country.
What lies beneath
25 Jun 2010 |
Dr R K Pachauri
| The Hindustan Times
It was in 1989 that Ali Shams Ardekani, former deputy foreign minister of Iran, and I came up with the concept of the Iran-Pakistan-India (IPI) pipeline. In 1990, I invited Ardekani to present this project at an international conference organised by us at New Delhi, and it received considerable interest, resulting in the Government of India pursuing it seriously in the ensuing period. There were obvious concerns from the Indian side, on the risk of a critical part of the pipeline that will pass through Pakistan, particularly the Balochistan region.
To create some level of assurance, we managed to get the United Nations Development Programme (UNDP) to support a project involving energy cooperation between India, Pakistan and Nepal. The focus of this project was to develop an ironclad agreement for the IPI pipeline. We were able to get the involvement of two politicians from each country to ensure that the exercise was not merely a pipedream put forward by academics and researchers but something that politicians, in at least India and Pakistan, found acceptable. The two Indian politicians who participated in the exercise were Jaswant Singh of the BJP and Mani Shankar Aiyar of the Congress. Of the two Pakistani politicians who took part in the project, one was Shah Mehmood Qureshi, the current foreign minister of Pakistan.
Back then, Iran was eager and almost desperate to sell gas to India and Pakistan at very low and stable prices, a situation which has drastically changed today. Today, the IPI pipeline, as far as India is concerned, won\'t only be a difficult political proposition. With the pricing arrangements being offered by Iran, its economic viability has become questionable. Meanwhile, Pakistan reportedly signed an agreement recently for a pipeline to get gas from Iran with a total investment reported to be in the range of $7 billion. India is not part of this project, even though it was originally conceptualised and developed by an Iranian and an Indian.
Today, Iran is being subjected to escalating UN sanctions to which even China is a party, much to the disappointment of Iran. Fifteen years ago, however, the situation was different because Iran was not known to have started work on nuclear technology, and the rest of the world, except the US, did not have serious political or diplomatic problems with it. At that stage, I recall a conversation I had with the then Under Secretary of State to whom I pleaded that the US should initiate a dialogue with Iran, which will strengthen the moderates\' position in that country. Perhaps India could have played the role of an honest broker in bringing about a thaw in US-Iran relations.
Whether India will ever be able to take advantage of Iran\'s abundant reserves of natural gas is questionable. But it should focus on the bigger issue of its relations with fractured societies. Clearly, the lesson from Iran will have important implications on our dealings with Pakistan. Pakistan is not a monolithic society. A growing number of Pakistani moderates want both peace with India and an elimination of terrorism - which was earlier aimed largely at India but now poses a threat to peace and stability in Pakistan itself. The prime minister\'s efforts in this regard show his wisdom, sagacity and vision, the exercise of which will benefit both nations.
A new complication, which makes the need for peace with Pakistan more urgent, is the discovery of precious minerals in Afghanistan by the US Geological Survey. Of critical importance are the reserves of lithium, a metal that\'s essential for the production of efficient batteries. If India were to move towards electric vehicles - which it cannot avoid for long - easy access to large reserves of lithium, like the ones discovered in Afghanistan, will be hugely beneficial.
But, clearly, access to Afghanistan\'s mineral resources will be out of question if our relations with Pakistan remain strained. In fact, it is not inconceivable that, like with an oil-rich Iraq, the presence of foreign troops in Afghanistan, and their dominance in the area, could become a permanent feature. An understanding with Pakistan could perhaps ensure earlier withdrawal of foreign troops from Afghanistan and its peaceful development.
The central theme of the last South Asian Association for Regional Cooperation (Saarc) meeting, held in Bhutan in April this year, was climate change. It is a challenge that afflicts all countries in South Asia. To overcome water scarcity through cooperation and collaboration or use solar energy on a large scale in the Thar Desert and other regions, peace between India and Pakistan is a prerequisite.
Now that serious attempts are being made to resume the composite dialogue between the two countries, people in India must support the effort. The strategic implications of Afghanistan\'s newfound mineral wealth need to be viewed in a strategic context. We cannot change our neighbours and, today, we cannot ignore the fact that our neighbour\'s neighbour has become mineral-rich overnight.
When you spill, don't lose the lesson
24 Jun 2010 |
Dr R K Pachauri
| The Indian Express
The oil spill in the Gulf of Mexico has not only attracted widespread attention and created a major political fallout in the US, but has posed some major issues that impact the future of global energy policy and the international response to the growing challenge of climate change. Some general inferences can be drawn from this tragic occurrence, which has not only led to the loss of human life, but is continuing to threaten marine life and coastal areas in the Gulf.
The first major inference relates to the manner in which decisions are taken for deep sea exploration that were infeasible in the past. Today, deep sea drilling technology has been perfected to a level where going as deep as several kilometres has become routine. However, before a project is implemented for drilling at such depths, seldom is a proper analysis of possible scenarios carried for assessment of consequential risks.
It is obvious that there is a lag between the use of deep sea drilling technology and the development of solutions which could be implemented promptly and
effectively in the event of a major disaster taking place. Unfortunately, regulations that might ensure appropriate safety measures in the event of disasters (which may be low in probability but high in impact), have lagged behind. The US in particular is likely to put in place effective regulatory measures by which this gap hopefully will be filled with safeguards preceding offshore drilling in these high risk areas.
The second major inference from this disaster is the fact that there would be a timely reappraisal of how far our thirst for oil should take us to different regions of the globe. A recent article in Newsweek mentions that if the oil industry has its way, we may have more such unplanned experiments as we have seen with the Deepwater Horizon disaster in the Gulf. It is estimated that there are 30 billion barrels of crude oil equivalent beneath the Gulf of Mexico\'s ultra-deep waters, that is depths below 6000 feet. It is reported that in 2008, Shell finished drilling an oil well 9000 feet under the gulf and BP has another well 7000 feet below.
All of this raises a very fundamental question about energy policy. Former US president George W. Bush deprecated the fact that Americans are addicted to oil. Unfortunately, the rest of the world, and certainly countries like China and India, are blindly following the US example. The question is whether we can rely on the growing demand for oil being met at reasonable prices. This seems very unlikely given the fact that even the International Energy Agency (IEA) has revised its estimates of oil production downwards in recent years. One statement that has been made by the IEA is very pertinent in defining future global energy policy - \"sustained investment is needed mainly to combat the decline in output at existing fields, which will drop by almost two-thirds by 2030\". If the oil spill in the Gulf leads to stringent regulation and restriction on drilling in offshore and other difficult areas, clearly the decline in existing reserves is unlikely to be made good through new discoveries. At the same time, demand for oil is continuing to grow notwithstanding the slight pause due to the recent economic recession. However, even in North America, demand for automobiles has picked up again, assisted by government support for the automobile industry and programmes like \"Cash for Clunkers\". According to the IEA\'s reference scenario, non-OECD countries will account for 93 per cent of the increase in world primary energy demand and all the growth in oil demand, which will rise from 85 million barrels per day in 2008 to 105 million barrels per day in 2030.
All these facts also have to be seen in the context of the need to mitigate emissions of greenhouse gases. One of the major findings of the Fourth Assessment Report (AR4) of the Intergovernmental Panel of Climate Change (IPCC) is the fact that mitigation of emissions is accompanied by large scale co-benefits such as reduced air pollution, higher energy security and greater employment (such as with a shift to renewable sources of energy). The Gulf oil spill also reminds us that another major co-benefit could be avoidance of marine pollution and damage to vulnerable coastal areas. In the case of India, a lack of coordinated attention to energy security issues is propelling the country towards crisis. TERI has carried out detailed analysis of future prospects using an extensive energy economy model, which reveals that on a business-as-usual basis, at the end of two decades from now India may be importing 750 million tonnes of oil and 1300 million tonnes of coal. Now that coal prices exhibit similar increases as the price of oil, it is obvious that with this level of import dependence on fossil fuels, India is certainly not moving towards an energy secure future. The answer lies in substantial improvements in energy efficiency and a shift to renewable sources of energy, all of which would require a major restructuring of the economy and changes in lifestyles. For instance, our growing dependence on private vehicular transport would only increase our vulnerability to substantially higher oil imports. Price increases in the global market could hit India\'s economy to a disastrous extent. It was only three years ago that global oil prices reached a level of $147 per barrel, and given current trends in the global market a similar level of global prices cannot be ruled out in the not too distant future.
The Gulf oil spill certainly has major lessons for the global community, but it is in India\'s interest to learn from it before developments force us into taking action that over time would become much more expensive. For instance, it is cheaper for us to improve the efficiency of our buildings, factories and commercial complexes right now than to have to retrofit them with efficiency enhancing measures in the future. Likewise, for us to enhance our public transport infrastructure and modernise the Indian Railways today is preferable to being forced into doing so in the wake of unacceptably high oil prices in the future. If we learn these lessons today, then perhaps the Gulf oil spill would leave us wiser.
Delivery key for energy sector
15 Jun 2010 |
Dr Leena Srivastava
| Financial Chronicle
The energy sector is a high priority area for the government. Many measures have been tried to accelerate reforms in the sector - intense discussions took place for years on vertical unbundling of functions with limited success and new regulatory institutions have mushroomed all over the country providing a great extended employment opportunity to various public servants. But a decade and a half have gone and progress has not matched the rhetoric.
The scale of investments required in the energy sector necessitates the aggressive participation of the private sector. Wisdom led to the identification of distribution reforms in the electricity sector as the key to bringing about improvements in the financial performance and operations of utilities. However, the vexed issue of pricing of electricity brought this promising and much-needed area of reform to a standstill after the Delhi distribution privatisation experience. The case with the pricing of petroleum products was just the same. The independent electricity regulatory commissions were brought in to provide an arms-length distance between politics and the economic functioning of the energy sectors - constant interference in the electricity pricing decisions and a diluted petroleum regulatory board ensured that the government defeated itself in its purpose.
Apart from direct interference with energy pricing decisions, governments - both central and state - stymied themselves by the poor accountability of the regulatory commissions and the inadequate support to the infrastructure needed for fast-paced, innovative reforms to be implemented - the classic case in point being the electricity metering systems that would allow the measurement and monitoring of the impacts of reform measures.
The government is today deliberating on a new version of regulatory reforms bill that aims to provide uniform treatment for all public utilities in the country. This bill does take cognisance of the weaknesses of earlier systems, but stops short of proposing the truly hard measures that are needed to put the energy sector on track. First and foremost is the issue of competition. If, as is the case in the electricity sector, there is no competition in the market then the regulatory function becomes a mere accounting exercise for tariff determination purposes. The only competition being seen is in the bidding processes for setting up new infrastructure projects - which is laudable - but has little or no impact on the downstream performance of the sector.
If, on the other hand, pricing regulation is not divested to the regulatory commissions, as in the case of the petroleum sector, then too the uncertainties of politically driven pricing would greatly deter newer competition entering the market.
Then comes the issue of the regulatory commissions themselves. The new bill once again lays out the constitution of the selection committee, the minimum disciplinary qualifications needed in commissions and the protected terms of the members. But, as has been noted from past experience, following due pro-cess in a technically right sense does not necessarily lead to the desired outcomes. The need of the hour is to be able to identify members who have a vision for the development of the sector and a proven track record of performance delivery in an open, transparent and consultative manner. The draft bill has taken a big step in requiring regulatory commissions to prepare annual plans, but they should also be required to prepare rolling five-year plans into which the annual plans would dovetail.
The key issue is one of protected tenures. Theoretically, the advantages of doing so from the point of view of independence of decision-making are obvious. Past experiences, unfortunately, belie these advantages and careful thought needs to be given to these provisions. The disadvantages of a protected tenure lie in the weak pressure to perform. If a member of a commission is loathe to making decisions needed to push reforms forward, then the sector would be stuck with the situation. Of course, the question would arise as to who is evaluating the performance of the commission and its members? How can appropriate benchmarks be set? Accountability of commissions has to go beyond mere reporting of (non) performance at the end of a year.
Finally, the challenges of having multiple regulatory authorities in a sector were revealed in recent weeks in the context of the financial sector. Discussions are now on about a super-regulator for the sector. If a new draft regulatory bill is being discussed for public utilities, it is an opportune time to revisit the issue of a single energy regulator and to strengthen mechanisms for coordination across other related sectors as well.
Electricity related legislations were implemented in 1998 and revised in 2003. If new legislation is being discussed today, let there be as comprehensive and unabashed an overhaul of this new legislation as possible, drawing on experiences from across all other sectors.
Needed: Dynamism in institutions
01 Jun 2010 |
Dr Leena Srivastava
| Financial Chronicle
A recent visit to one of the east Asian countries brought into focus one major achievement that India needs to be proud of - an achievement that normally does not merit much attention in media circles. The reference here is to India\'s scientific and technical institutions, which in terms of capacity, represent a quantum improvement over the existence of individual experts in several Asian countries. Not only are institutions able to effectively put together the requisite skill sets to holistically address the increasingly complex problems of the world, but also offer the advantage of building on institutional memory while at the same time bringing greater stability, independence and accountability into their actions.
We owe the existence of these institutions largely to the vision of the early governments in India and, in no small measure, to the pioneering industrialists of the time - in particular, the Tata house. However, now more than ever, we need to ensure the dynamism and the innovativeness of India\'s institutions. Not only are we living in an age of unprecedented challenges (climate change, food security, human health) but also in such a fast-paced world that no longer can we afford to sequence the quest for, and development of, new solutions to their testing and wide-scale implementation and acceptance in society. As brought out succinctly by the national knowledge commission (NKC) in their recommendations relating to science and technology, we are faced with \"disappearing boundaries between various disciplines of knowledge and knowledge emerging as a continuum.\" This blurring of boundaries is a reflection of the need for holistic solutions - the development of scientific solutions that build on and further technological developments; the dissemination of technologies that would be sensitive to societal perceptions and inclusivity.
However, it is a common refrain today that the productivity and innovation in India\'s institutions is on the decline. While the increasingly dismal scenario in science and technology institutions has been recognised by the government resulting in an increasing emphasis on promoting science education and research, the scenario with social sciences is even more alarming. Not only are there too few a number of good quality institutions in the wide field of social science research but many disciplines vital to understanding and promoting societal transformations are under-represented, if not missing. Unless these social science institutions are developed and become more visible in terms of their contributions and relevance, it would be difficult to visualise a breaking down of boundaries between scientific research and social research within institutions leaving Indian research capacities lagging!
In the context of science and technology research, the NKC enumerated the major causes of what they called the \"current crisis in Indian research\" as: the lack of interaction between natural and social sciences, lack of a long-term vision (one could add in a coordinated or integrated manner), lack of differential remuneration and the lack of scientific methods (the last being a reflection of the quality of education in the country). Undoubtedly, these are critical factors ailing the research establishments in India. However, one of the most crucial additional barriers to good quality research in publicly-funded institutions is the lack of peer-pressure and accountability while in the (quasi-) independent research institutions it is the lack of regulatory support to such institutions in order to access funding. Another big challenge is to find ways to improve quality research in universities. Research universities are in poor health due to inadequate infrastructural facilities and inadequate funding for quality research.
While proposing an extended version of the National Science Foundation for India - the National Science and Social Science Foundation, the NKC has tried to indicate some benchmarks of accountability by saying that we should aim for \"at least a 20 per cent success rate\". However, maybe in the conception and design of new institutions at least we need to go beyond purely publicly-funded organisations. Requiring publicly-funded institutions to leverage at least 20 per cent of their revenue from non-government sources would provide the test of the market place to such institutions. At the same time, significantly enhanced incentives should be provided for the corporate sector to invest in research in pre-qualified institutions. A precedence for this type of pre-qualification exists in the system of FCRA registrations for recognising institutes that can receive foreign contributions. Having said that, the process of receiving foreign contributions itself is in dire need of streamlining - the clearance process today are between 12-18 months and a lot more in terms of human resources.
In summary, India is privileged to have a good institutional base to build on. However, the creative spirits in these institutions need to be freed and nurtured to ensure a globally competitive research environment in the country and an ethos that results in India\'s re-emergence as an innovation leader.
Celebrating for posterity
22 May 2010 |
Dr Yogesh Gokhale
| The Asian Age
The time for celebration of the International Day for Biodiversity, which falls on May 22, has come once again. On May 22, 1992, the work on the agreed text of Convention on Biological Diversity (CBD) was culminated at Nairobi. However, in 2010, a serious retrospection of the issues concerning biodiversity is needed to understand the gravity of the problem.
India, which accounts for 2.4 per cent area of the world\'s landmass, contains 8.1 per cent of the world\'s biodiversity and is one of the 17 like-minded Mega Diverse Countries recognised at CBD. India is known for its megafauna such as tigers and elephants managed under the flagship programmes called Project Tiger and Project Elephant. The public perception of biodiversity in the form of scenic nature and wildlife neglects the ubiquitous presence of community conservation efforts such as sacred groves, which are found all over India. The widespread distribution of biodiversity within and beyond the ownership of forest departments governed by several overlapping mandates in India has made the management of biodiversity extremely complex.
Amongst the several pertinent issues model of governance for biodiversity conservation and equitable sharing of benefits arising from the commercial use of the biodiversity are posing great challenges. Governance is an important issue in the management of biodiversity, especially protected areas. The example of Sariska Tiger Reserve is an eye-opener where the tigers became locally extinct as a result of the functional lapses of the forest department. Many of these issues in case of Sariska are common for several protected areas in the country. It points towards the fact that the approaches of the conservation management in India have grossly neglected the dependence of the local communities on the forests for livelihoods. The success of eco-development programmes has remained at the pilot scales. Out of more than 600 protected areas, not even 100 protected areas have addressed issues of dependence of local communities on the surrounding natural habitats. The estimated over 200,000 sacred groves in India only symbolises the importance of community-based conservation but even today efforts of local communities remain unknown for the purpose of conservation management.
The implementation of the Biological Diversity Act, 2002, is struggling with herculean mandate as against the miniscule infrastructure such as to establish over two lakh local Biodiversity Management Committees (BMCs) to execute documentation of the People\'s Biodiversity Register, safeguard the vast biological resources and associated traditional knowledge against the biopiracy and so on.
There is a huge deficit on behalf of states to have full-fledged State Biodiversity Boards to strengthen the functioning of National Biodiversity Authority.
The biodiversity conservation strategies need to develop the approach at a larger landscape level, going beyond the existing single large protected areas and taking into consideration the supporting functional value of several smaller patches of the forests in the vicinity of the protected areas. There is a need to develop the directories of potential conservation areas in form of Community Conservation Areas, traditional conservation practices like sacred groves, etc, corridors, habitats of migratory species. The availability of the geo-specific information along with the requirements for conservation management of such areas will help devise the conservation options.
Where the long-term sustainability of biodiversity and wildlife depends on the secure and inviolate protection of their habitat, the relocation and settlement of the rights of people should be undertaken sensitively. The relocated community should be compensated beyond the value of land in terms of employment opportunities or share in revenue may be in the form of preferential shares in the eco-tourism business. Displaced people without land should be assisted through skill retraining and employment options, preferably linked to conservation.
Amendments in the Wildlife (Protection) Act, 1972 for community and conservation reserves provide new opportunities to involve communities in conservation.
These provisions can also be used to change the status of existing protected areas so as to involve local communities in management wherever necessary to reduce the conflicts. Similarly, the provision of declaring National Biodiversity Heritage Site as per the Biological Diversity Act, 2002, can be applied to a range of community conservation efforts such as of sacred groves, Nistar forests etc. Conservation management can, thus, be institutionalised by the involvement of local communities.
Saarc silver lining for energy
18 May 2010 |
Dr Leena Srivastava
| Financial Chronicle
The South Asian Association for Regional Cooperation (Saarc) recently celebrated 25 years of its establishment and came out with a fitting declaration titled "Towards a Green and Happy South Asia". Several exciting initiatives have been identified in this declaration, which also recognised the need to focus on people-centric development and the concept of Gross National Happiness, as opposed to Gross Domestic Product (GDP), which has been pursued by Bhutan. Framing this in the context of the fairly impressive rates of economic growth that several countries of the region have been experiencing, resulting in an attractive regional average growth rate, and the overall theme of the summit around climate change ensured that this silver jubilee edition of Saarc was truly reflective of the concept of sustainable development.
The Thimpu Statement on Climate Change recognised the need for formulating mitigation and adaptation strategies at various levels and also recognised the win-win opportunities that existed around cooperative regional initiatives to address the challenges of climate change. The summit declaration simultaneously recognised the need for enhanced cooperation in the energy sector in order to facilitate energy trade and the development of renewable energy sources (including hydropower) as well as conventional energy forms. So, how can this agenda be taken forward? Do we need to differentiate clearly between the opportunities for trade vis-a-vis the opportunities for cooperation?
Variations in resource endowment and energy consumption pattern among the Saarc member states theoretically create opportunities for energy trade among them. However, the only tradable resource surpluses that can be identified are the rich hydro resources in Nepal, Bhutan and the northeastern regions of India, which are somewhat isolated from the rest of India because of the geographical positioning of Bangladesh. Electricity generated from hydro sources is not only low-carbon but also relatively cheaper. The challenge, however, for regional cooperation around this resource would be the expectation of magnanimity on India's part -- to allow the use of its territory to wheel electricity from this source to other countries when India itself suffers from huge power shortages!
The other sources of low-carbon energy that may be abundant in the region would be primarily solar energy as well as biomass. While both these energy forms could meet local energy demands in a decentralised form, solar energy could also contribute to the centralised electricity grid through largescale capacities that can be developed, as is being planned in India under the National Solar Mission. However, it is difficult to visualise regional electricity trade centred around these resources in the short or medium term due to their higher costs. What may be an option is to set up an electricity-trading platform that would allow the countries of the region to trade in any surpluses that may exist during time of day or over the year (seasons).
With no other energy resource surpluses, Saarc may well have to limit itself to regional cooperation either in the form of sharing of non-energy resources (such as human, technical or financial resources), or a joint procurement of energy from outside the region -- all member states are either dependent on crude oil import or petroleum product import to meet their domestic demand! Such 'soft' opportunities too could go a long way in building the necessary environment of trust that is sorely needed among the countries of the Saarc region. Additionally, given the scale of differences that exist in the energy markets of the region, yet another set of opportunities for regional cooperation could exist around shared energy infrastructure - be they power plants, refineries or energy import infrastructure. Smaller member states could buy stakes in large energy generation/import facilities and earn proportional rights to the energy therefrom benefiting from economies of scale and technological progress.
Energy demand in the region is expected to grow at a rapid pace with substantial investments required in building requisite energy related infrastructure. According to an estimate, Bangladesh requires an investment in the range of $5-6 billion over the next 10 years for power sector development. The International Energy Agency estimates the investment cost of meeting the projected increase in generating capacity, transmission and distribution in India to be around $680 billion till 2030. Nepal's combined investment need for generation and transmission for the next 10 years is estimated at $1.22 billion. If the countries of the region are to develop along optimal low-carbon energy paths, and not lock themselves into soon-to-be-obsolete infrastructure, it is imperative that they take a long-term integrated view of energy cooperation development and exploit all possible opportunities for both trade and cooperation. Not the least of their challenges, and opportunities for cooperation, would be to provide clean energy access to the vast majority of their population!
Energy future remix
11 May 2010 |
Dr R K Pachauri
| The Asian Age
The American media is providing a great deal of attention to the oil spill which has taken place in the Gulf of Mexico, and it is evident that in respect of the impacts of this major environmental disaster the worst is not yet over. In fact, according to latest reports, not only is there thus far a complete failure to stop the flow of oil from the offshore well which has resulted in this problem, but much of the oil floating on the surface of the sea has yet to hit the coastline. The clean-up of this disaster would take several months according to informed estimates, and the loss in economic and ecological terms would be incalculable. The sight of birds dying slowly because their bodies and feathers have been covered by oil is not only a tragedy in terms of the species affected, but is also an indicator of how human activity is adversely affecting the ecosystems of this planet.
Governor Arnold Schwarzenegger of California has come out openly expressing opposition to drilling for oil and gas in offshore areas. The world has certainly been heavily dependent on consumption of hydrocarbons to run the economic engine of human society since industrialisation began, but we need to look at several factors that should influence our decision in favour of a distinctly different energy future. The reality is that the search for hydrocarbons will take us further and further away from established sources and into areas that are going to prove increasingly fragile. The symbolic sitting of a Russian flag at the North Pole is only an indicator of the fierce competition that we would witness over possible reserves of hydrocarbons in the Arctic region in the years ahead.
If we look at the projections of the International Energy Agency over the past five years they have changed downwards, leading analysts to believe that perhaps anything beyond a hundred million barrels a day of oil production is now going to be an impossible achievement. This figure is much lower than what was forecast just a few years ago - 115 million barrels a day.
There is no getting away from the fact that the world will have to move to a very different energy future from what we have assumed till very recently. Decision-makers should not ignore the fact that it was just three years ago that oil prices had increased to a level of $147. Further economic recovery worldwide is going to increase the demand for oil and natural gas to levels that would exert immense upward pressure on hydrocarbon prices very soon in the future. All of this should really convince decision-makers in governments and businesses to substantially step up research and development efforts and financial allocations by which not only do we improve the efficiency of energy use across the entire chain, but also bring about the development of viable and sustainable energy technologies essentially based on renewable sources.
Those countries which have read the writing on the wall are moving purposefully in creating technological solutions which would bring about a major shift in the world energy supply mix. It is now well known that China, for instance, is investing heavily in building its renewable energy supply capacity, and would clearly reach a position of comparative advantage that would not only help them in expanding supply in China itself, but also provide access to the growing global market which is likely to emerge under any set of scenarios that can be foreseen at this point of time. It is pertinent that Chinese Premier Wen Jiabao, while addressing a meeting of the State Council on May 5, 2010, to discuss issues of conserving energy and cutting emissions, emphasised the fact that China needs to make much larger efforts to cut emissions and conserve energy to meet their targets as set in the 11th five year plan. According to this plan, China will cut its per unit gross domestic product energy consumption by 20 per cent compared with the 2005 level by the end of 2010.
Another nation which has not deviated from its green growth strategy despite unfavourable economic conditions in the last two years is South Korea. In that country the green growth plan, which has been in place for over three years now, clearly targets a substantial increase in supply of green energy and in finding a share of the global market on the basis of projections made right up to 2030. The experience of Germany has also been largely favourable, not only in terms of expanding the physical supply of renewable energy, but also in generating new industry, creating employment and economic opportunities which did not exist earlier, given Germany\'s dependence on imports of energy.
Another impressive project which is been pursued vigorously now is the \"desert tech\" project which will essentially generate power in North Africa using solar energy and transmit electricity to Europe. Undoubtedly, there would be strategic opportunities from such developments because Western Europe, which relies heavily on gas from Russia, would be able to diversify its sources of supply.
The South Asian Association for Regional Cooperation (SAARC) nations met in Thimpu, Bhutan, earlier this month with climate change as the main theme of the meeting. While the declaration at the end of the summit has identified some useful directions, it is critically important for the countries of this region to embark on a programme of collaboration that would make the best use of technological opportunities and exploitation of economies of scale. For instance, the desert region of Sindh in Pakistan and Rajasthan in India have great similarities on the basis of which large-scale solar-based power could be generated to supply to a substantial area of Pakistan and a large part of western and northern India.
There are enormous benefits in exercising a vision that not only deals with the problem of pollution from conventional fossil fuel-based energy systems but also creating a base of technological cooperation that would bring this region a level of cohesion which has been missing thus far. New sources of energy could bring the nations of SAARC together, while showing the way to the rest of the world.
Challenge of higher education
05 May 2010 |
Dr Leena Srivastava
| Financial Chronicle
In his recent visit to Australia in early April, HRD minister Kapil Sibal did a sterling job of laying out the magnitude of the challenge that India faces in increasing its gross enrollment ratio (GER) from the present 12.4 per cent to 30 per cent by 2020 (GER in developed countries is over 70%) -an increase that would need approximately 800 new universities (nearly double the existing number) and about 35,000 -40,000 new colleges. He was also absolutely on the mark when he argued that the global community should, in its own interest of both access to a well-qualified pool of human resources as well as to avoid the social conflicts arising from a possible failure from doing so, invest in educating Indians. In laying out these statistics, Sibal was conveying India\'s seriousness about its invitation to foreign universities to invest in India. More power to him.
However, the key challenges in India are two. One relates to the poor quality of academic performance in the country and the other to the huge gap identified above. The poor quality of the existing institutions -out of 17,000 colleges and 317 universities in 2006, only 30 per cent and 50 per cent, respectively, have some quality assessment undertaken and only 97 colleges and 9 universities of these have been identified as those having potential for excellence -speaks volumes of what is ailing our education system. The most obvious issues relate to the lack of incentives for teaching as a profession (India has a student, teacher ratio of 26:1, which is double that of Brazil and China), lack of investments in higher education (0.37 per cent of GDP compared with well over 1 per cent in the developed world) and the lack of incentives for pursuing doctoral studies that has become a self-limiting factor for a future pool of university teachers! Only about 25 per cent of the teaching staff in colleges in India have PhD degrees.
In a booming economy, the past few months notwithstanding, the question that jumps out at you is -why would anybody want to do a PhD in India? It would take anywhere between 4-7 years to finish a PhD, your success rate is probably less than 50 per cent, the likelihood of finding a committed and qualified supervisor is slim and the market for PhDs is still limited to either the academic sector or academic institutions. So after going through all this stress and time-investment, a PhD candidate in India would start at a salary level that would be a fraction of what he/she may have earned as a post-graduate joining the corporate world -and all these years invested would not even count towards the qualifying criteria for a professorial position when the same years invested in the pursuit of knowledge without getting a PhD degree would! Inviting foreign universities to set shop in India is, prima facie, an essential but not a sufficient step in the direction of both improving quality as well as reducing the demand gap. Looked at from a reputed foreign university\'s perspective what is it that is attractive about this offer?
They would need to first of all step into an unknown and notoriously unstable policy environment in India. Second, they are highly unlikely to dilute their brand by associating with any educational institution apart from those that have been identified as having the `potential for excellence\'.Third, why would these institutions give up/share their prized faculty members? And, from the point of view of the faculty members themselves, why would they work in India for a salary that may be a fraction of what they would earn internationally -not to speak of the respect they command from their current affiliations.
So, where would that leave India? We may, at least till the medium term, concentrate on quality improvement in the top-rung institutions bringing them closer to international standards. But this would not help the millions that are competing hopelessly for the very limited number of seats in these same institutions. We may be able to attract back the very few altruistically oriented NRI/foreign faculty members but there is no guaranteeing the quality of all such faculty members. To say that any international faculty is superior to our homegrown faculty would be an insult to these brave academics. Not to speak of the tremendous churn that could be created if the terms of employment for foreign faculty were to be any different from those for the Indian faculty.
Sibal cannot be envied his task. The goals that are being set are ambitious. However, it is extremely important that this challenge is addressed in a holistic manner. The finance ministry and other ministries need to align themselves towards these goals. Adequate financial resources need to be provided for both education and research and a liberal environment created in which to pursue research.
Today, both the academic as well as the research institutions are languishing and unless special efforts are made to reinvigorate them through proper incentives and recognition, India stands to lose the limited but hard-earned capacity it has developed since Independence.
India’s lethargy in energy sector
21 Apr 2010 |
Dr Leena Srivastava
| Financial Chronicle
The Indian sub-continent is reeling under an unusually hot summer combined with a complete lack of rainfall due to certain weather conditions. The national capital region (NCR) too has been experiencing temperature levels thÂat are 8 - 9oC above normal for this time of the year. As such, it is no surprise that due to increased space conditioning load on the system, the demand for electricity has been higher than expected. However, should we not plan for some uncertainties in weather conditions, be it relating to an increase in demand arising from temperature abnormalities or a reduction in supplies because of rainfall patterns? Why is it that on every occasion, when we are faced with severe power crises, we seek to find excuses in such vagaries of nature?