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EDITORIAL

NOIDA/DELHI

THE HINDU

TUESDAY, APRIL 19, 2016

The road not taken

tuesday, april 19, 2016

Grounding
Vijay Mallya
he suspension of Vijay Mallyas diplomatic
passport by the Ministry of External Afairs,
within a week of his failing for the third time to
heed an Enforcement Directorate summons to
appear in connection with a money laundering probe, is a
prompt and appropriate step. The Directorate had
repeatedly sought his personal presence and, in the face
of non-compliance, wrote to the MEA seeking revocation
of the passport. The Ministry, which has given the liquor
baron a weeks notice to explain why the oicial travel
document should not be revoked or impounded, should
increase the pressure on him to return to India and face
the law of the land. As a sitting member of the Rajya Sabha he is due to retire on June 30 and as someone who
portrays himself as the victim of a campaign of calumny
and asserts that he has neither the intention nor any
reason to abscond, it is appropriate that he submit himself to due process. At its last hearing, the Supreme Court
had given him time until April 21 to clarify when he
would appear before the court. Regardless of his dim
view on the merits of the allegations against him, Mr.
Mallya still has to discharge his liabilities, which the
banks that have lent to his companies have quantified at
about Rs.9,000 crore. He also has to answer the Central
Bureau of Investigations charge that the Rs.900-crore
loan Kingfisher Airlines had taken from IDBI Bank involves money-laundering; it is in this connection that an
open-dated, non-bailable warrant against him was issued
by a special court in Mumbai.
Mr. Mallyas elbow room is shrinking, and he must
know that he is not merely battling the legal consequences of corporate loans gone bad. He is also battling a widespread perception that the loans went bad because of his
profligate ways, poor management and possible malfeasance. His flamboyant lifestyle has been central to contributing to a negative public perception; if anything, his
sudden exit from the country has only added weight to
such a view. He has challenged the determination by
banks that he is a wilful defaulter by arguing that he is
personally not a borrower, and only gave a personal guarantee for corporate loans. Any credibility that one could
attach to his defence will have to flow from his own conduct and submission to due process in this country,
something that the Supreme Court has underscored by
asking him for a possible date for his appearance and an
authentic statement of his assets. The Central government must not ease the pressure on him, and must take
recourse to all diplomatic and legal means to achieve the
objective of bringing him back. It cannot aford to lend
the impression that it allowed Mr. Mallya leave India at a
crucial stage in the legal proceedings for recovery of the
money due from him and is not doing enough to submit
him to the process of law.

On March 31 and
April 1, leaders of
52 countries including
India
came together in
Washington DC
ZIA MIAN &
for the fourth NuM.V. RAMANA
clear
Security
Summit. Held every two years since 2010, these summits
started with the recognition of the risks
posed by plutonium and highly enriched uranium (HEU), the key ingredients for making
nuclear weapons, and aimed to secure all
vulnerable nuclear material in four years.
Despite this high-level political attention,
and fanfare, these summits have achieved little. To make matters worse, countries that in
2010 were producing plutonium and highly
enriched uranium continue to do so, and the
dangers from nuclear weapons have been
neglected.
The main failings were of conception and a
political willingness to settle for easy options. Despite the expansive declarations of
the need to maintain efective security of all
nuclear materials, which includes nuclear
materials used in nuclear weapons, the summits narrowed their focus to civilian holdings in non-nuclear weapon states. This material is already being monitored by
International Atomic Energy Agency (IAEA)
inspectors and, more importantly, is but a tiny fraction of actual global stockpiles. Some
numbers will help put this in perspective.

Nuclear Security Summits have yielded little by

focussing on securing small amounts of nuclear
material. Any real progress must entail the U.S.
and Russia reducing stockpiles and India and
Pakistan reining in competitive nuclearisation

Nuclear haves and have-nots

Closing the 2016 Nuclear Security Summit,
U.S. President Barack Obama summed up
what has been achieved in the six years since
this efort started: Weve now removed or
secured all the highly enriched uranium and
plutonium from more than 50 facilities in 30
countries more than 3.8 tons, which is
more than enough to create 150 nuclear
weapons. This may sound like a lot, until
one looks at the scale of the actual problem.
Since 2006, the International Panel on Fissile Materials (IPFM), an independent group
of arms-control and non-proliferation experts from 17 countries, has been keeping
track of HEU and plutonium around the
world. In Global Fissile Material Report 2015,
IPFMs most recent annual assessment of
stockpiles, it was estimated that there is
about 1,370 tons of HEU in the world,
enough for more than 76,000 simple, first-

Obama said at hundreds of military and civilian facilities around the world, theres still
roughly 2,000 tons of nuclear material.

generation fission implosion weapons with

about 99 per cent of this material held by nuclear weapon states, mostly Russia and the
United States. The IPFM estimated the global stockpile of separated plutonium as about
505 tons, enough for about 1,30,000 nuclear
weapons. About 98 per cent of this material
is stored in the nuclear weapon states. Taken
together, this gives a total global stockpile of
almost 1,900 tons of nuclear weapons-usable
material.
To be sure, IPFMs stockpile figures are
unoicial estimates most of the nuclear
weapons states have not declared their fissile
materials stocks but there is reason to assume the overall figure is reasonable. In his
opening remarks at the 2016 summit, Mr.

(600 kilograms) of weapons-grade plutonium, while Pakistan has about 0.2 tons (200
kilograms). India is also believed to have separated about 5 tons of reactor-grade plutonium material that can be fashioned into nuclear weapons but was not made for that
purpose. India has another 0.4 tons of reactor-grade plutonium that it has placed under
IAEA safeguards and thus is not available for
use in weapons. Pakistan, so far, has no stockpile of reactor-grade plutonium.
Many, including Mr. Obama, have recognised that plutonium is a problem. Speaking
in Seoul, South Korea, in 2012, he stated, We
know that just the smallest amount of plutonium about the size of an apple could
kill hundreds of thousands and spark a global

The summits narrowed their focus to civilian holdings in

non-nuclear weapon states. This material is already being
monitored by IAEA inspectors and, more importantly,
is but a fraction of actual global stockpiles.

The subcontinental race

No one at the Nuclear Security Summit
talked specifically about HEU or plutonium
in South Asia. This is despite that fact that India and Pakistan, in many ways, lie at the centre of concerns for those wanting to reduce
the risks from fissile materials. For a start, the
two countries are among the four states in
the world that continue to produce HEU and
plutonium for weapons, the other two being
Israel and (possibly) North Korea. There are
no oicial reports of the sizes of Pakistani
and Indian stockpiles of HEU and plutonium.
The IPFM estimates that India and Pakistan
each have a stockpile of about three tons of
HEU. In addition, India is estimated as of
end-2014 to have a stockpile of about 0.6 tons

crisis. This is why we simply cant go on accumulating huge amounts of the very material, like separated plutonium, that were trying
to keep away from terrorists.
This insight, shared by almost all countries
with nuclear energy, has been lost on Indias
Department of Atomic Energy, which is committed to the separation of plutonium from
the spent fuel from nuclear reactors (dubbed
reprocessing). It has also pursued the construction of a special kind of nuclear power
plant called a fast breeder reactor that makes
more plutonium than it consumes as fuel.
Most countries with nuclear energy have
never gone down this route; of the few countries that have tried, most have abandoned it.
Nonetheless, India continues to pursue this
goal despite the fact that the two technologies underlying this way of generating nuclear energy, reprocessing and fast breeder reactors, have proven hugely expensive and

CARTOONSCAPE

Are negative rates

the new normal?
f it is hard to agree on strategies that are critical for
global growth, then at least avoid the ones that
could hurt progress. This seems like a reasonable
reading of the deliberations at the Spring Meetings of the World Bank and the International Monetary
Fund last week. Clearly, the earlier impatience to see a return to the robust rates of growth that preceded the 2008
meltdown is gradually giving way to a more sober acceptance of a modest medium-term recovery. Chinas slowest
rise in GDP since early 2009, low global commodity prices, and the uncertainty over Britains continued membership of the European Union, together seem to contribute
to a more cautious stance. Scepticism over excessive reliance on monetary tools, especially in the backdrop of
the prolonged low interest rates in the eurozone, is not
unfamiliar in these forums. But U.S. Treasury Secretary
Jacob Lew was in line with the majority when he spoke
uneasily about the pursuit of negative nominal interest
rates, currently being adopted by six central banks and 25
per cent of the world economy. The explicit opposition to
negative rates could partly be explained by the exceptional and experimental nature of this particular measure
rates of zero per cent and below have been a rarity until very recently. Proponents see negative rates as a
means to induce consumers to spend more and banks to
lend more, with the potential to spur growth and raise inflation expectations.
The implications of low or negative returns for individual savings, however, could be mixed. Customers
would either have to save more to meet long-term targets
or hold cash to avoid its adverse efects, assuming that
banks brave themselves to pass on the burden. The negative rates policy has thus come under considerable attack
both in Germany and Japan, despite the macroeconomic
objectives they were designed to realise. A more serious
objection, in view of the sizeable ageing populations in
these societies, is the impact on the viability of pensions,
life insurance and savings vehicles. German Finance
Minister Wolfgang Schuble has gone so far as to blame
the rise of populist anti-EU parties for the European Central Banks negative rates policy, dubbed penalty rates
in his country. Growing public anger is also said to limit
any room for manoeuvre for further rate cuts by Japan.
Curiously, within two months of the hike in the U.S. in the
rate of lending last December, the chair of the Federal Reserve did not rule out a plunge into negative territory.
While emphasising the potential to create additional
stimulus in the economy and maintain price stability, the
IMF is tentative about how long governments may persist with negative rates. Meeting in Shanghai earlier this
year, the Group of 20 countries agreed to refrain from a
competitive devaluation of currencies. It may not be long
before negative rates policies, which in efect weaken
currencies, are pushed up the agenda for concerted
action.

CM
YK

highly problematic.
But nuclear developments in India and Pakistan did come up at the 2016 summit. In his
wrap-up statement to the media, Mr. Obama
pointed out two major obstacles to nuclear
disarmament. The first was that it is very
diicult to see huge reductions in our nuclear arsenal unless the United States and Russia, as the two largest possessors of nuclear
weapons, are prepared to lead the way. The
second was wed need to see progress in Pakistan and India... making sure that as they
develop military doctrines, they are not continually moving in the wrong direction. He
is correct on both counts.
No sign of scaling down
Any real progress towards ending the
grave danger posed by nuclear weapons to
humankind must address the brute fact that
the United States and Russia had about
14,700 nuclear weapons (as of 2015), and the
other seven nuclear weapon states held a
combined total of about 1,100 weapons.
Worse yet, both the United States and Russia
have launched massive long-term nuclear
weapons modernisation programmes,
which in the case of the United States is estimated to cost as much as $1 trillion over the
next 30 years. For a President who started of
promising in Prague in 2009 that the United
States will take concrete steps towards a
world without nuclear weapons, the modernisation programme represents Mr. Obamas greatest failure.
Similarly, the nuclear situation in South
Asia is bad and getting worse, just on a smaller scale. And this has been the failure of
South Asian leaders. Both countries are developing nuclear arsenals that are basically
scaled-down versions of those created by the
superpowers during the Cold War. India has
developed a variety of land-based missile
types and is operationalising the Arihant nuclear-powered submarine, to be armed with
the 700-km range K-15 or 3,500-km range K-4
nuclear missiles. Pakistan, for its part, has
been developing air-launched, groundlaunched and sea-launched cruise missiles
and an array of nuclear-capable ballistic missiles, some with ranges of over 2,000 km. It
also has a naval strategic forces command
and may arm some of its conventional submarines with nuclear-tipped cruise missiles,
and, in the long term, seek to build its own
nuclear-powered submarine.
Pakistan also is seeking nuclear weapons
to use on the battlefield. These pose special
challenges; as the White House Press Secretary explained, Tactical nuclear weapons
that are designed for use on the battlefield
are a source of concern because theyre susceptible to theft due to their size and mode of
employment the threshold for their use is
lowered and these weapons create the risk
that a conventional conflict between India
and Pakistan could escalate to include the
use of nuclear weapons.
Just as India clings to its plutonium ambitions, Pakistan refuses to budge on its tactical
nuclear weapons. General Khalid Kidwai,
who for 15 years was responsible for the
countrys nuclear weapons programme, insists that Pakistan would not cap or curb its
nuclear weapons programme or accept any
restrictions.
The future looks bleak. Years have been
wasted securing small amounts of nuclear
material while real nuclear dangers have
grown. To address the nuclear threats that
actually imperil the world, the focus should
be on getting states to make a clear commitment to eliminate nuclear weapons and
agree to concrete and urgent plans to eliminate nuclear arsenals and the nuclear material stockpiles that make them possible.
Zia Mian and M.V. Ramana are with the Program on
Science and Global Security, Princeton University, U.S.,
and members of the International Panel on
Fissile Materials.

LETTERS TO THE EDITOR

Patel agitation
Yet another episode of agitation by
the Patidar community indicates
that the reservation issue is
acquiring a new dimension (Patel
agitation turns violent, April 18).
Since Independence, diferent
communities have been pushing
for greater reservation, with
political parties supporting this for
the sake of vote bank politics. Is the
political class considering the
efect of these agitations on the
morale of students and candidates
appearing for various competitive
examinations, and who do not
come under the reservations
umbrella?
Vinay Kumar,
Ludhiana, Punjab

While positive discrimination has

lifted millions out of poverty and a
life of indignation to bring them on
parity post-Independence, the
ensuing
deliberate
discrimination
against
unreserved students is creating
another strata of dispossessed and
utterly helpless citizenry. Intergenerational equity does not
necessitate the carrying over of
historical baggage. A lot of Indians
go
abroad
as
reservation
refugees due to virtually nil access
to
higher
education
and
employment at home. There is an
urgent need for a rationalisation
of reservations. At least now, let
there be a semblance of a beginning
to set right things by enabling all to
have an equal access to
opportunity.
Anoop Hosmath,
Mysuru

Country without a pause

Elections in India are influenced
more by the personality of the
candidates contesting them than
the
larger
electoral
issues
(Editorial, April 18). This leads to

Letters emailed to letters@thehindu.co.in must carry the full postal address and the full name or the name with initials.

the creation of vote banks in the

country, and voters of the same hue
are overcome by waves into
looking towards a particular
political outfit. The Constituent
Assembly did not explicitly lay
down
any
provision
for
simultaneous
elections
to
panchayats, local bodies, State
assemblies and Parliament. Of
course there is the cost factor In
a polling booth, there is one box for
the provincial election and another
one for the Central election and
hence no additional cost The
voter has just to drop his ballot
papers into two boxes. While the
idea of simultaneous elections
sounds promising on paper, it
could spell political hara-kiri for a
diverse nation like India. In a
politically
charged
electoral
atmosphere, the election of a
common regime to oice, though
highly improbable, to all tiers of
governance, could prove to be a
constitutional
nightmare.
Therefore,
sacrificing
representative democracy at the
altar
of
administrative
convenience is not a prudent idea.
Shreyans Jain,
New Delhi

KG gas scam
In its eastern ofshore units, the
Gujarat
State
Petroleum
Corporation is currently dealing
with High Pressure and High
Temperature (HPHT) fields that
are being explored in very few
parts of the world (The new KG
scam, April 18). Such diicult
projects are known to take time to
develop. Perhaps the fact that
ONGC has not produced a single
barrel of oil from its deepwater
eastern ofshore locations till now
might help.
Oil companies take up projects
only after elaborate surveys by the
Directorate
General
of
Hydrocarbons There is oil and gas

in the KG Basin, but it is a diicult

project. Moreover, India does not
have even basic, indigenous HPHT
tools. Almost all service projects
are given to U.S.-based oil service
companies, that take up both the
role of service and technical
partner in domains like drilling,
well-testing and production.
Mayur Nawal,
Mhow, Madhya Pradesh

The squandering of a sum of nearly

Rs.20,000 crore, and with no trace
of gas, is a case of precious money
going down the drain. It is shocking
that despite a totally unproductive
venture
being
adversely
commented
upon
by
the
Comptroller and Auditor General
of India, there has been no
meaningful attempt at aixing
responsibility. This by itself
demolishes the myth created over
the Gujarat model of development.
If the contracts were indeed
awarded to entities with no
experience in oil exploration or
production, it assumes a very
serious dimension that merits
independent investigation by a
sitting Supreme Court judge. It is
necessary to determine whether
there was an element of criminality
on the part of those involved in the
decision-making process. The
CAG reports on the 2G spectrum
and coal block allocations put the
UPA government on the mat. That
the KG scam has escaped scrutiny
speaks volumes of the BJPs deft
media management.
S.K. Choudhury,
Bengaluru

Banks and the Mallya case

The nationalisation of banks
undoubtedly served its true
purpose by enabling rural
expansion and the sanctioning of
cheaper loans to priority sectors
such as agriculture, education,
housing, retail and so on. However,

this lasted for only about 15 years

after which public banks began to
experience the consequences of
stressed assets and dipping profits
(Lessons from the Mallya case,
April 18). The writers claim that a
lack of transparency is what has
weakened the public banking
sector is grossly incorrect. The
truth is that the unholy politicalcorporate nexus, indiscriminate
loan waivers and political
populism are what are sinking
these banks. Their reputation and
revenue are both on sale.

banks is the root cause of the NPA

mess. The call for making the
entire process of lending to big
corporates transparent merits
serious
consideration.
The
Reserve Bank of India and the
government should also not come
in the way of the publication of
names of wilful defaulters. The
public has a right to know how its
money has been utilised.

Kshirasagara Balaji Rao,

Hyderabad

The
proposed
high-octane
campaign towards having smaller
families, with spacing of children
to protect maternal health, is
welcome (Weekend Being page
Whats the family plan?, April
17). For long, the emphasis on the
small family norm has been
ignored. Demographers generally
agree that unchecked global
population growth will impact
everything from pollution control
to new epidemics like Zika,
sustainable
food
production,
climate change, and freshwater
supplies. Overpopulation is the
unspoken driver of environmental
destruction. Rising numbers with
only a finite supply of resources on
our planet is a recipe for disaster,
and managing this is the challenge.
India no doubt was one of the
earliest nations to adopt family
planning as a national mission but
somewhere along the way we seem
to have lost the plot. A fresh
national approach to encouraging
small families, especially among
those who are poor, should be our
priority and the campaign should
proceed in this direction. Benefits
like enhanced rations, access to
clean fuels like gas, state medical
benefits, and continuing education
should be the incentives towards
adopting a small family norm.

It is terrible that the Indian banking

industry, considered to be one of
the strongest in the world, is now
facing the problem of nonperforming assets (NPA) because
of wilful defaulters and political
pressure. Reforms are the need of
the hour, such as removing
political influence, consolidating
public banks into manageable
blocks, creating a banking board
bureau for vigilance, more
transparency in loan disbursal
using technology, and having more
bank branches in the rural areas.
Ankit Galgat,
Panipat, Haryana

I am sure that in the Mallya case, it

will be some bank staf in the lower
ranks who will be made to face the
music rather than eforts being
made to go after those at the
highest level responsible for the
mess the banks are now in. There
must be honesty and transparency
at every stage of the paper trail.
R.S. Raghavan,
Bengaluru

It is certainly not fair to blame

banks for lending huge amounts to
Vijay Mallya despite his failing
business. Political interference in
decision-making in public sector

J. Anantha Padmanabhan,
Tiruchi

The new family plan

H.N. Ramakrishna,
Bengaluru
ND-ND