Tag Archives | Mint

In Mint: Let India’s urban poor pay for good water

I write in Mint this week on how thinking along the lines of micro finance principles can change how we approach water pricing. Instead of an ideological stand on keeping water free, it’s better to ask how we can make clean water cheaper and more affordable for urban India’s most deprived.

In microfinance, people also acknowledge that it costs more to lend to the poor. When most people have to take a big loan from a bank, they have a steady income to show. They have a credit history. They also have assets they can pledge as surety, in case they default on the loan. The poorest of the poor don’t have salaries to showcase. They don’t have assets to pledge. The risk of defaulting on a loan is higher, and it is humane that they be allowed to default when the circumstances are dire. By allowing microfinance institutions to charge higher interest rates, the policies allow them to service these needs.

Similarly, the costs of supplying water for a city’s poor can be high. People often don’t have address proofs or any proofs of legal residence, making installing water connections harder. Getting even basic piping to reach the heart of a slum is not always cheap, given that there is hardly any road space to dig up. Maintaining pipes is even tougher. Installing and maintaining water meters is difficult, thereby making bill collection costlier.

It is highly disingenuous to ignore all these real issues and shout for a right to free water.The better approach is to ask, “how can we make water cheaper for the poorest?” And that line of thinking can birth an entirely new range of solutions.

Read the full article at Live Mint, February 13, 2015.

Live Mint e-Paper - Mint - 14 Feb 2015 - Page #11 Pavan Srinath

 

Comments { 0 }

Economic conservatism vs. social conservatism

Mint has a great editorial today on the Bharatiya Janata Party and its ideological conflicts:

The BJP needs to get over this dichotomy. The bulk of Indians today are concerned with livelihood issues. Since the mid-1990s, cultural nationalism of the kind championed by Advani at one point has lost salience. It is time for the BJP to transform itself into a party of economic conservatism, one that argues for free markets, secure property rights and a minimalist state. India cannot afford to have a party in power that does not pay attention to sound macroeconomic management. [Livemint, June 11, 2013]

There are a few things that need to be elaborated on here. First, there is some subjectivity in the application of labels like conservatism and liberalism for economic philosophies, even before we bring in social concerns. There’s fiscal conservatism on one end, which advocates for healthy public finance with minimal debt spending, and moderate, balanced government budgets. There’s economic liberalism on the other end, focusing on strong property rights, a large role for free markets and individual action, limiting the state’s role to the provision of public goods and the correction of market failures. A lot of fiscal conservatives do believe in economic liberalism and a free market economy, but the two concepts are not necessarily wedded together.

Second, over and above these, there’s the school of liberal conservatism, that blends fiscal conservatism, economic liberalism and a socially conservative outlook. Social conservatives are often driven by the understanding that society (and institutions) are inherently fragile, precious and require safe-guarding. They believe that for social harmony, a certain amount of consistency needs to be maintained in the social fabric. They believe in preserving the ties that bind people together: family, religion and customs. Whether or not one agrees with this worldview, or be willing to compromise on individual liberty and justice for the cause of greater social harmony, there is certainly a political space for social conservatives to occupy in any healthy democracy.

In most rich nations, there are major political parties with the aforementioned liberal conservative base. The Republicans in the United States, the Conservatives in United Kingdom, the Christian Democratic Union in Germany are all examples of the same. Several of these liberal conservative parties are in power right now around the world. Thanks to this, people often assume that those who espouse the cause of social conservatism also care about economic freedom. Consequently, there are frequently calls for the Bharatiya Janata Party to do the same, and there is a lot of disappointment when they don’t.

Economic liberalism and social conservatism go hand in hand in richer nations as their social stability is dependent on them continuing to be rich and prosperous. This is not the same for a growing country like India. As the Mint editorial rightly states, “Embracing free markets and its cognate political position—liberalism —is bound to weaken cultural nationalism.” Economic freedom and growth are very likely to empower new groups of people (like Dalits), chafe at established social orders, and overturn social mores – be it women working during late hours or filing for divorce more often.

So can the BJP transform from a socially and economically conservative party to one that socially conservative but economically liberal? How will it chart the course to get there, given that the ordinal axes that explain Indian political ideologies are very different from western ones? Or is a new, yet-to-emerge political formation the best vehicle to champion the liberal conservative cause? Or, is fiscal conservatism minus a support for free markets and property rights a compromise platform that the BJP can take up?

The coming months and years will tell us.

Comments { 4 }