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Some sweet news for sugar

For long TN Chief Ministers have not been enthusiastic about interacting with business leaders. It’s a welcome change that the TN Chief Minister met with a delegation of sugar producers and listened to their specific problems.

For years, there has been an unresolved conflict: sugar companies expressing their inability to pay the state-advised price for sugarcane fixed over and above that recommended by the Centre after a detailed study of costs and prices. This has been resulting in mounting arrears on sugarcane supplied. There are prolonged litigation and difficulties in reconciling the differences.

With national production falling steeply during the sugar season 2016-17 to 203 lakh tonnes, Tamil Nadu, already a weak producer, witnessed production dropping to around 6.5 lakh tonnes against the capacity of 25 lakh tonnes. Even as all India production in the current season estimated to bounce back to 322 lakh tonnes, the state’s production is predicted to rise to just 10 lakh tonnes.

The delegation led by Dr P G Periasamy, President, South India Sugar Mills Association, is sanguine about the meeting with the Chief Minister held after years. With the monsoon normal and the Mettur dam overflowing, there are good prospects for the industry enjoying better times during the next season as well. But over the longer term, the viability of the industry, dependant on water-guzzling sugarcane crop, appears uncertain.

With the criterion changing from production per acre to water consumption per crop, there will be increasing queries over the rationale for water-intensive crops like sugarcane and rice raised in water-stressed states like Tamil Nadu.

Trump’s popularity ratings still high

I spent a large part of June and July in the US. News during the weeks were dominated by US President Trump’s meeting with North Korean President Kim Jong-un, the G6 Summit in Canada, the NATO meeting in Brussels and with the Russian President Vladimir Putin. The unpredictable stances of President Trump evoked mixed reactions: widespread criticism by those wedded to the American ideals of globalisation and free trade on the one side and vast sections of Republicans admiring his America First pronouncements.

There are several factors favourable to Trump: the country recording a high rate of economic growth, low level of unemployment, a strong dollar and robust consumer spending. Both the meetings with Presidents of North Korea and Russia, though did not result in immediate tangible results, were welcome in the move towards global peace. The comraderie witnessed pointed to the scope for bridging differences through close personal relations.

Trump’s blunt utterences bordering on insults at Toranto and Brussels evoked wide criticism. Still, the NATO meet held at Brussels had the effect desired by Trump; he urged member countries to step up their spending to 2 per cent of the GDP on defence. This is expected to reduce the substantial support of NATO budgets by the US. For several decades now the US has been suffering huge budget deficits, massive trade deficits with every other country and mounting public debt. The US consumer has been accessing goods across the globe at the lowest prices. This has resulted in several of the manufacturing activities moving out of the US. The gap between the haves and have nots have been widening; the vast differences in income levels of the top 1 per cent of the population and the bulk of those at the bottom are disturbing.

The focus on bringing back manufacturing to the US will help expand employment. However, with much higher wages, the comfort enjoyed of low prices will be threatened and the consumption-oriented citizens can turn against the party in power. In my discussions with US citizens, I got the impression that this will turn the tide against President Trump. Despite a high degree of automation, cost of manufacture in the US cannot bear comparison with low-wage countries and fast developing ones like Mexico, Poland, Vietnam…

Corrupt habits die hard

Over the decades corrupt practices have been effectively and efficiently institutionalised. The PDS system has been seethed in corruption: there was a proliferation of bogus ration cards. The universal entitlements extending the benefit of subsidised prices to the entire population of the state and under-weighment were contributing to massive leakages and diversion of stocks in massive quantities. Often one came across lorry loads of rice moving out to neighbouring states and sold to profit.

The practice is so well-entrenched that it would be quite challenging to wean the politicians and staff from these corrupt practices.
A colleague of mine expressed admiration over the ‘streamlining’ and digitalisation of the administration of the public distribution system. Printing the bills listing the purchases and recording this in the cell phone of the consumer are welcome measures that can eliminate malpractices, he said.

I was keen to check and convince myself of the change. My colleague provided details of the purchases made by him of rice, dhal, sugar, etc. He said he paid Rs 53. To my query whether he checked the bill he said that no printed bill was provided and was informed that the bill will be transmitted to his cell phone. Inexplicably, despite the PDS shop supplied with hand-held printing machines, the bill was sent only the next day. When I checked, it showed the items sold with quantities inflated. The statement showed Rs 93 as the total!

While switching to the computerised system the effectiveness could be ensured only if the implementation is strict and rigorous.
There was a report of even more blatant violations of law in the most lucrative liquor business. Look at these instances:

  • It has been a well-established practice at the TASMAC sales outlets for routinely charging an extra Rs 5, Rs 10, Rs 20 per bottle of liquor-related to quantity. Each shop generates a few thousand rupees every day of such cash that is reportedly divided among the influential local politicians, police and the staff. The introduction of digital hand-held billing machines expected to correct the malpractices didn’t help.
  • In several areas shops and bars operate illegally far beyond the closing hours. In places like Jafferkhanpet, these continue into the morning hours, of course with the connivance of the local police.
    Since all major political parties have a share in such loot, there is little scope for correction.

Tribute – G N Subramanian

We record the demise of G N Subramanian (GNS) at the ripe age of 101. He was among the first subscribers of IE and continued this all through our existence of over five decades. When I passed a hat around for raising small loans for the purchase of imported printing machines in the 1970s, he, along with his younger brother, N Venkataraman, responded spontaneously. I had a special affinity with him on another account. He was one of the students of Madras Christian College soon after it moved to a sprawling campus at Tambaram. GNS used to provide vignettes of commuting from George Town to Tambaram. Like him I pursued the honours course in mathematics; served the Maths department of MCC during 1960-62.
GNS served with distinction the Posts & Telegraphs department in Delhi and Chennai where he headed the accounts department of Madras Telephones.
At my request, he lent his guidance and served as the President of the Social Service Centre, Mambalam, engaged in a variety of social, literary and cultural activities. GNS had been supporting several social and religious causes.

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