People & Their Problems

New Delhi, 3 April 2008

Tackling Tuberculosis

NEED FOR NEW EFFECTIVE DRUG

By Radhakrishna Rao

Notwithstanding rapid strides made by India in areas such as healthcare and medical research, the country continues to lag behind in fighting the scourge of tuberculosis (TB), dubbed not long back as a disease of poverty and insanitary conditions. According to the World Health Organisation, India with over 3.4-million tuberculosis patients, accounts for about one fifth of the global figure, making it the most TB prevalent country.

Perhaps the most disturbing feature of the TB scenario here is that 17 per cent of the patients who have availed treatment earlier have developed multi-drug resistance form of the malady. As pointed by the WHO, of all the fresh cases in the country, 1.2 per cent is infected with HIV and 2.8 per cent of all the new cases have been diagnosed with multi drug resistant TB. Union Health Minister Anbumani Ramdoss recently stated that one in the few new cases of TB in the world is in India and this imposes enormous burden on patients, families and communities. Worse, the combination of HIV and TB further complicates the problem. .

A study by the World Bank comes to the conclusion that the economic impact of TB deaths and benefits of TB control among the 22 high-burden courtiers are greatest in China and India, where the combination of growing incomes and decreased TB deaths are translating into a significant economic gain. Clearly, with western drug firms focusing on drugs for diseases prevalent in industrialised countries of the north, the need to evolve a new effective drug for TB has become all the more pronounced

In this context Dr. T.S. Balganesh, Head of Research at Astrazeneca, a pharmaceutical outfit says that India and the world urgently need a new drug against TB because the nature of the disease itself has undergone a radical change. "When we started work eight years ago on a new drug for TB, we began with the concept of developing one that shortened the duration of a treatment. But now my vision of a new drug for TB is any therapy that works and brings benefit to the ailing TB patients, especially those infected with the drug resistant TB. The duration of treatment is not an insurmountable logistic issue, but the need for relief for patient overrides everything else today" he adds.

As pointed out, not long back TB was closely linked to poor hygiene, nutritional deficiency and poor immune conditions. "All of them were pointers that if you had a robust health system and a clean and hygienic environment, TB could be controlled. By and large that has happened in most countries, as the general economic situation has improved and we have been able to control the spread of TB,” observes Balganesh but adds that “with the new societal changes impacting the immune system, you are now seeing TB all over, now in select population group. We are also seeing a more diverse face of TB. That is worrying part because you cannot change lifestyle so easily".

Earlier TB of the lungs was widely prevalent since the immune system of the patient blocked its spread to other parts of the body "That is the way the immune system reacts to TB causing microbe". This particular form of TB is caused by the microbe by name tubercle bacilli, which spreads from one person to another through air. The sneezing by a TB patient releases a large number of germs into the air where they remain suspended for a very long time.

As it is, TB can affect any group. But the diagnosis in children is rather difficult Patients usually have cough in septum lasting for about three weeks. Further, weight loss, poor appetite and extra sensitivity are the other symptoms associated with TB. Liquor consumption and tobacco addiction add to the vulnerability one develops for TB. Carelessness, ignorance and social stigma all conspire to make TB “a difficult to treat disease”. Moreover, many patients stop taking drugs half way through treatment and the poorer ones are not in a position to spare time and money to come to the clinics for proper treatment.

As things stand now, the resistance developed by the disease causing germs to a range of antibiotics, is highly worrying to medical researchers engaged in the battle against TB. In addition to HIV, diabetes is also known to add to the spread of TB. For diabetes is known to compromise the human immune system fighting against TB. Against this backdrop Dr. Balganesh says, "There is now a shift in how TB needs to be perceived in our socio cultural environment as against a century ago, where it was hygiene, nutrition and general well being .We thus must be pragmatic and take necessary steps about what we can do."

The bright spot in India's TB scenario is the successful implementation of the highly- effective DOTS (Directly Observed Treatment Short Course) which is being made available to every segment of the society. As pointed out by the WHO, DOTS is the best prescription to fight the menace of TB. Physicians too specializing in TB treatment say that only a combined crusade with the active cooperation of the government agencies and the NGOs, which incidentally are doing much better work can help combat TB. Experts attribute the spectacular increase in TB cases across the world to the emergence of multi drug resistant strains of the disease causing germs, spread of AIDS and bleak chances of new drugs hitting the market.

In a significant move, a group of Indian scientists has developed a molecule that promises to drastically cut down the time required for the treatment of TB to just two months. This novel molecule which has been tested on mice and guinea pigs and proven to be effective was developed under the Council of Scientific and Industrial Research's "New Millennium Indian Technology Leadership Initiative" by the pharmaceutical major Lupin in collaboration with the Hyderabad University, the National Chemical Laboratory, the Central Drug Research Institute and the Indian Institute of Chemical Technology.

All said and done, public health experts in India have expressed concern that the massive upsurge in HIV/AIDS cases in the country could lead to an increased incidence of TB infection. For most of those who get infected with TB causing micro organism in normal circumstances, don't develop the disease since their immune system keeps the disease causing germs under check. However, once HIV infection sets in they develop full blown TB. Medical experts on their part drive home the point that while a person with only a TB infection has just 10 per cent lifetime risk of developing active TB, the risk is six times higher for those infected with both TB and HIV.

Further, enough evidence has been gathered to show that TB accelerates the regression of an HIV infection into full blown AIDS. In this context, guidelines issued by the National AIDS Control Programme say, "If TB occurs in the early stages of infection when immunity is only partially compromised, it usually manifests as typical tuberculosis that affects the lungs. But as the HIV infection advances, patient can develop other lung infections that resemble tuberculosis or a form of tuberculosis." Guess research needs a greater push. ---INFA

 (Copyright, India News and Feature Alliance)

Economic Highlights

New Delhi, 17 April 2008

Growing Inflation

GET SERIOUS ABOUT AGRICULTURE

By Dr. Vinod Mehta

(Former Director, Research, ICSSR)

Last week the government went into a tizzy as inflations rose over seven per cent. In a knee-jerk reaction Finance Minister Chidambaram said that if necessary he would not mind sacrificing growth for the sake of controlling inflation. Well, as a politician, he may have his compulsions, but as an economist he should know that inflation occurs when there is a mismatch between demand and supply. The wider the gap between demand and supply, especially of essential commodities like grain, edible oil, fuel etc., the more severe the rate of inflation will be. 

It is also well-known that in the short term, inflation can be tackled by augmenting the supply of goods in short supply by importing or by acting against hoarders. However, if international prices are higher than the domestic prices, then imports will certainly not work. The imported goods will in fact, further push up the prices, unless of course the Government is willing to subsidise heavily.

This leaves us with only long term measures to augment the supply of essential goods on a sustainable basis to tackle inflation.  Since there is a severe mismatch in the demand and supply of agro-based products like grain, edible oil, pulses etc., we need pay serious attention to the agricultural sector.  Its neglect can impose heavy costs on the country in future both in terms of inflation as well as growth.

In a report, “Re-energizing the Agricultural Sector to Sustain Growth and Reduce Poverty” (2005), the World Bank states: “Agriculture will remain the mainstay for a large share of the rural population in the next decade, many of which also comprise the rural poor. Promoting more rapid agricultural growth, particularly achieving the government goal of  four per cent growth per year not only exclusively during the 10th Plan period but for the medium to long term, will be extremely crucial not only to achieving strong economic performance for the country as a whole, but also in lifting large numbers of agricultural households above poverty.”

Independent studies too have pointed out that the situation will not remain the same by 2020 unless we attend to the agricultural sector now. In a study prepared for the International Food Policy Research Institute it has been said that if food productivity continues to decline the demand for cereals will exceed domestic production by 23 million metric tonnes by 2020.  By then India will be a net importer of food grain to feed its people. Thus, it is time for us to start serious thinking about our agricultural sector.

It is common knowledge that till date there is no agricultural policy worth its name in this country.  Successive governments have failed to lay down any sensible agricultural policy.  It is also a fact that the rich landlord lobby in every political party has ensured that the national agricultural policy does not go beyond fixing procurement prices and paying them subsidies.

If we have to achieve a reasonable growth of the agricultural sector, then we must take reforms in the agricultural sector more seriously and ensure their implementation. As per the data from UN Food and Agricultural Organization, India is the second largest producer of wheat, rice and corn in the world, after China. However, productivity of Indian agriculture is very low, while on the other hand, China has only seven per cent of the world’s arable land but is able to feed its population. Thus, we have to pay attention to the per-hectare productivity, which is very low by world standards.

For instance, Egypt recorded the highest yield of 89 quintals per hectare for rice, while England recorded the highest yield of over 80 quintals per hectare for wheat. China recorded the average yield of 63 quintals for rice and 40 quintals for wheat. As against this, India’s average annual yield of rice is 29.3 quintals per hectare and that of wheat 25.8 quintals.

However, one disturbing feature of India’s agricultural sector is that public investments in this sector have been declining steadily in absolute terms and as a share of total investments, since the mid 80s. As pointed out by the World Bank, the decline has serious implications for the (agricultural) sector’s longer term growth prospect. One estimate shows that 10 per cent decrease in public investments (including irrigation and power) leads to 2.4 per cent reduction in agricultural GDP growth. One of the reasons in decline in public investments in the agricultural sector has been the growing subsidy requirements.

Again, according to one estimate, in the year 1999-2000 public investments amounted to only about 14 per cent of agricultural subsidies (including food grains, fertilizer, canal irrigation and power subsidies). Fertilizer alone takes a very large chunk of the total subsidy. Between 1981-82 and 1999-2000 the total subsidy increased from Rs. 15.6 billion to Rs.83.3 billion. It is estimated that subsidy share of the farmer was 67 per cent, whereas that of the industry was about 33 per cent.

One of the consequences of this subsidy on fertilizer has been that it has led to distortion of input use, leading to nutrient imbalances in the soil and ground water contamination in many areas.  Similarly, subsidies on crops are also distorting the production structure of crops. Anyhow, one thing is clear-- subsidy cannot lead to increase in productivity.

Productivity, however, can be easily increased by developing newer varieties.  We will need to put in all our efforts to develop high-yielding varieties of different kinds of agricultural products, which can go well with the weather conditions in India; and such a research will need to be extended to allied activities like animal husbandry, fishing and plantation. But the bureaucratic environment that exists in our agricultural research institutes is regrettably not conducive to research that is needed for the development of high-yielding varieties of crops or milch animals. 

The number of suicides we have had in the past at the ICAR shows how callous we are towards the agricultural research scientists. Therefore, as a first step, we must revamp the setup of our agricultural research institutes and agricultural universities and fix some goals for the development of high yielding strains of food crops, edible oil seeds, sugarcane etc.

Pending development of our own high-yielding strains, we should make best use of high-yielding seeds of various crops that are available in the international market.  If the seeds, being sold by the multi-national companies can substantially raise the agricultural productivity per hectare, why should not the country go in for them, even if they are expensive?  The use of such seeds would also increase the earnings of our farmers.  What the agricultural research institutes can do is help identify the seeds being sold by MNCs which would be more suitable to Indian climatic and soil conditions and would yield the maximum produce per hectare.

The country also needs to pay attention to the irrigation system.  Sixty years since Independence our agriculture is still dependent on rainfall and a shortfall during any year can severely upset our crop targets. Besides, whatever water we have for the agricultural sector, most of it goes waste because of mismanagement.  A large number of countries have gone in for drip irrigation system, which for the moment is said to be the best irrigation system for a number of crops.  Therefore, we need to rethink our irrigation policy--either develop our own system or scout for one available in other countries and if possible buy the technology outright and implement it.

In our country, the development of agriculture has been uneven. Some States such as Punjab and Haryana have gone through the phase of green revolution, while Orissa and Bihar are yet to experience it.  The plus point is that we have still a vast untapped potential for the development of agriculture in the country.  Instead of having an all-India agricultural strategy, it may be more meaningful to have a State specific agricultural strategy within an overall general national agricultural strategy. This would help because the specific local, cultural, social and economic factors could be taken into account for the rapid development of the agricultural sector.

In sum, we have to reduce our dependence on rain, increase area under irrigation, develop and use high-yielding varieties of seeds and other modern inputs on a largescale to achieve surplus in almost every agricultural product. In short: we need a holistic approach. --INFA

(Copyright, India News and Feature Alliance)

Economic Highlights

New Delhi, 10 April 2008

Financial Sector

CRYING FOR REFORMS

By Dr. Vinod Mehta

(Former Director, Research, ICSSR)

With the economy achieving a growth rate of over eight per cent for the past four years, it’s time to complete the financial sector reforms, especially in banking. Whether the Government can gather enough courage to draw a map for such reforms at a time when General elections appear to be looming large, is highly doubtful. But, it must remember that reforms in the industrial sector will remain incomplete without wide-ranging reforms in the financial sector.

In the past few years, both the insurance and banking sectors have been thrown open to the private sector players, but the public sector banks and insurance companies continue to play a dominant role. In fact, the public sector units are responding well to the competition by private players and may just maintain their dominant position. At the same time these banks and insurance companies are also expected to play a major role in sustaining the over eight per cent growth rate.

Following economic liberalization over a decade-and-a-half ago, there has been resistance to reforms from employees in the financial sector. They fear they would soon become redundant as the public sector units would not be able to match competition from foreign firms. However, the reforms that have been initiated till date in this sector have belied all these fears, but opposition from the employees still continues. One may or may not accept it, but the fact is that the era of mega banks and insurance companies is here to stay.  And, the Indian financial sector has to prepare itself to this change.      

The reforms would need to be tackled simultaneously at four levels: one relates to the public regulation of these companies, two, organizational structure within these companies, three, changing the psyche of the employees and lastly technological upgradation. 

While we open up the financial sector to private business, both Indian and foreign, we must ensure that there is a stringent regulatory mechanism in place for all kinds of financial companies such as banks, insurance, chitfunds etc.  A sound regulatory mechanism as well as an early warning system can check any financial fraud at the first stage itself.  Such a regulatory mechanism should have statutory powers to deal with the compliance to financial regulations independent of the Government.  Remember, if the regulatory mechanism were in place the Global Trust Bank, the first private sector bank after the economic reforms, would not have failed a few years ago.  Besides, we also need to guard against sub prime crises of American banks. 

A corollary of stringent regulatory mechanism could be the standardization of accounting practices and single format for preparation of balance sheets, profit and loss account, income and expenditure account, etc. for all financial companies. 

As for the insurance firms, the regulatory authority is already in place and for the banking sector we have the Reserve Bank of India. However, it is more advisable to have a separate cell or body within the RBI with statutory powers to oversee the functioning of the banking sector especially with a view to tackling problems of unpaid loans and financial frauds as in the case of cooperative sector banks. 

The second aspect of financial reforms is the organizational structure. In both the banking and insurance companies this has become outdated. The Government’s hierarchical system has been superimposed on them. Such a system not only adds to the relative service costs but is also responsible for delays in taking appropriate decisions.  As against this, the new banks in the private sector, which came up after the economic reforms, have different organizational structures, which are much leaner and more efficient. 

This holds true for the public sector insurance companies too. Let’s say, the use of computers in keeping policy records of insured persons, has gained currency in big cities, but the bulk of work in small towns and villages continues to be done manually. In most private sector banks almost all the front desk work is now officer-oriented with a limited chain of command between the lowest and the highest ranking officers.  This is something, which our nationalized banks and insurance sector would need to do to survive the competition from private financial companies. 

The third set of reforms relate to the employees’ attitude towards its customers.  Even though there were a large number of banks in the public sector there was never really a competition among them, as they were following the same policies, offering same products and had the same wage/salary structure for the whole of the banking industry.  There was no system of reward or punishment.  And it is perhaps for this reason that bank employees by and large treat their customers with contempt.  This attitude needs to change drastically. Employees must be customer-friendly. While some staff at certain bank and insurance branches has changed attitude towards customers, in most cases they continue to be far from pleasant.  Therefore, in the new environment, there is need to develop a training programme to change staff attitude towards customers if they wish to survive in a highly competitive era.   

The fourth aspect of reforms relates to the technological base of our existing banking and insurance companies, if these are to survive competitive business. Even though a few banks and insurance branches have been computerized in metropolitan cities, technology in our financial companies is still outdated-- most work is still done manually.   It is thus not surprising that there are scams all the time, but are discovered only a year or two later.  It’s not enough to scrutinize bank branches alone. All banking activities must be integrated not only within the bank branch itself but also with other branches, regional offices, head office, insurance companies etc, and ultimately with the RBI.  All this requires a high quality of reliable financial management package for the financial companies. 

Sadly, most of our banks don’t have such packages. While in other countries, one can do all the transactions at one counter, here one has to go to separate counters for each banking transaction. In some cases, the same bank may treat the same customers differently.  For instance, let’s take the case of the State Bank of India.  At the Delhi International Airport foreign exchange counter it takes just a few minutes to change currency -- no forms need to be filled, only give your passport and the foreign currency and get the money changed.  Whereas, at the SBI main branch on Parliament Street, foreigners are asked to fill up forms and write each currency note number on the reverse of the form. A customer has to wait for a good ten to 15 minutes to change currency as all this is done manually! Why different requirements by the same bank? 

In fact, recent technological advances have made a bank branch or an insurance branch meaningless. With integrated financial packages one can process any transaction from anywhere in the city, or country, or even abroad.  Electronic banking has today made the mode of payment through bank draft or cheque simply obsolete – within moments one can make and receive payments. A customer can well sit at home or office and conduct all banking operations including buying and selling of shares, and mutual funds. But all banks are yet to provide such facilities here.  So, in sum we need to speed up financial reforms if we want to help the present growth rate in the economy. ----INFA

(Copyright, India News and Feature Alliance)

Events & Issues

New Delhi, 21 April 2008

India, Burma Talks

FRESH IMPETUS TO TIES

By Dr. Syed Ali Mujtaba

The Indo-Burmese relationship is acquiring a positive momentum of its own, despite western rights’ groups criticism of Myanmar's handling of pro-democracy demonstrations some six months back. India had rolled out the red-carpet for the Burmese military junta’s top leadership’s visit beginning April.

The Burmese delegation was led by the second-most senior military leader and Burmese Army’s chief, General Maung Aye. His entourage included the junta’s number five General, Thiha Thura Tin Aung Myint Oo.

General Maung Aye has the reputation of being anti-Chinese and wanting to be the architect of stronger military and economic ties with India, ever since New Delhi set up its “Look East” foreign policy in the early 90s, in order to have close links with the South East Asian nations.

General Maung Aye held a series of meetings with the Indian leadership including External Affairs Minister Pranab Mukherjee, followed by a call on President Pratibha Patil and Prime Minister Manmohan Singh. He also held extensive discussions with his counterpart, Vice-President Hamid Ansari.

“Several agreements were signed in the presence of Vice President Ansari and Vice Senior Gen Maung Aye, including an agreement and two protocols of the Kaladan Multi-modal Transit Transport Project and Double Taxation Avoidance Agreement,” the foreign office said in a statement. It added that Maung Aye had spoken to Ansari about the forthcoming referendum in May and the general elections in 2010 as part of the Burmese junta’s “political reform” and “national reconciliation” process.

In all the meetings, the current situation in Burma came up for discussion.  The General had briefed them about the recent initiatives of the military regime, including its decision to hold a referendum on the new draft constitution in May and the general elections in 2010.

While Manmohan Singh did make a note of the ‘positive steps' being taken by the Burmese government, he underlined the need for Myanmar to expedite the process and make it broad-based to include all sections of society, including Aung San Suu Kyi and the various ethnic groups in Myanmar, said the foreign office statement.

Besides political issues, matters of trade also came for discussion and the two sides sought to find ways to increase connectivity and opening up of more border points between them. Of special interest was the north-eastern States connecting Burma to increase bilateral trade. The two sides also talked about intensifying cooperation in the hydrocarbon sector. India showed its commitment to support Burma’s IT and telecommunication sectors.

Cooperation in security matters on the India-Burmese border, particularly in regard to the north-east insurgent groups taking shelter in Myanmar, was much on the agenda. India sought Burmese cooperation in controlling the insurgent groups, which often slip across the border to set up camps when pursued by Indian police. The Burmese side assured New Delhi that it will take care of India’s sensibilities and do its best to rein the insurgent groups on its soil.

An agreement and two protocols on the Kaladan Multi Modal Transit Transport project, which will allow sea access to the north-eastern States, were signed. The Kaladan project includes upgrading the Sittwe port and Kaladan waterway and construction of a road from Setpyitpyin (Kaletwa) to the India-Myanmar border at a cost of Rs.5.3 billion.

The project is expected to be completed by 2011-12 and would connect Kolkatta port with the Sittwe Port in Burma, a distance of 539 km. From Sittwe Port to Kaletwa in Burma, the transportation will be undertaken by waterway along the river Kaladan, a distance of 225km. The Kaladan River is navigable from its confluence point with the Bay of Bengal near Sittwe up to Kaletwa. Beyond this the river is not navigable. From Kaletwa to India-Burma border transportation will be by road along the border-- another 62 km by road. This would provide access to Mizoram and to other north-eastern States, as well as an outlet to the sea bypassing Bangladesh.

Ahead of the signing of the Multi-Modal Transit Transport project, the Indian Government had cleared a whopping Rs 535.91-crore as ‘Aid to Myanmar’ funds. The two countries also signed double taxation treaty that aimed at checking tax evasion, and boosting trade and investments between the two neighboring countries. The Double Taxation Avoidance Agreement will cover taxes on individual income, company profits, dividends, interest and capital gains.

At a banquet hosted in honour of the visiting Burmese General, Ansari termed Burma as a natural bridge between the Association of South East Asian Nations (ASEAN) and the South Asian Association for Regional Cooperation (SAARC). He confirmed India’s support for the efforts of the UN Secretary-General’s special envoy, Ibrahim Gambari, and conveyed that India did not believe that sanctions were helpful and could prove to be counterproductive. He urged the leaders of the Burmese junta to expedite political reforms and make these more broad-based to include the issue of imprisoned pro-democracy leader Aung San Suu Kyi.

While the discussions went off well, the Burmese military junta’s visit was marred by demonstration in New Delhi. Organized by Burmese, Indian and Tibetan activists the protests were against the Indian government’s policy on Burma, in which more than 1,000 people participated. Fortunately, these demonstrations were quite a distance from the place where the visiting guests were staying.

Apart from New Delhi, Maung Aye visited Bangalore to see India’s progress in space programme (even evinced interest in satellites for Burmese usage), and Bodhgaya, the site of the Buddha’s enlightenment.

India's strengthening of ties with Burma has been partly a result of the military junta cozying up to China, which had rung alarm bells in New Delhi. However, following Burmese junta's brutal crackdown on peaceful demonstrations led by Buddhist monks in September 2007, India had put on hold the sale and transfer of all arms to the Burmese government.

The momentary pause that withheld Indo-Burmese relations seems to be over and the recent thaw tends to suggests that a new momentum is gaining ground in Indo-Burmese relationship.--INFA

(Copyright, India News and Feature Alliance)