Working Paper Abstracts
Following are abstracts of policy papers commissioned
by Liberty Institute. So far issues covered are in the categories
of environmental issues, regulatory reforms, social issues,
and trade. Some papers are available for download. Comments
and criticism will be appreciated. If you have comments
for the authors or wish to review one of the papers, please
write to liberty@nda.vsnl.net.in
ENVIRONMENT:
Public & Private Garbage Removal Services
in India: Impact on the Environment
Laveesh Bhandari, Amar Gujral, and Aarti Khare
Waste generated in urban India is increasing
rapidly. The poor public provision for collection and disposal
of household waste is becoming increasingly conspicuous.
In such a situation private informal activities provide
essential relief by functioning at various stages of the
garbage disposal process. Agents at various stages of the
process either provide better service or simply provide
a service where there is none. This private activity not
only prevents a large portion of the waste from landing
up in overloaded and unsanitary landfills but at the same
time it provides cheap inputs for recycling firms operating
in the formal sector. But much of this activity takes place
almost outside the laws governing urban waste disposal.
Good environment policy therefore would be one that creates
conditions where such activities can be organised by communities
and private sector themselves.
Breaking the Gridlock in Water Reforms through Water
Markets
Nirmal Mohanty and Shreekant Gupta
 Available
for download in PDF (115 Kb)
Water markets have been in operation in many
parts of the world including India. Although informal water
markets have been in existence for decades, formal markets
with clearly assigned, private and transferable water rights
are of relatively recent origin. International experience
also shows that formal and developed water markets strengthen
the incentives for conservation and more efficient use of
water. The current challenge in India is therefore to establish
formal water markets, which will expand the scope of trading
and make inter-sectoral water transfers possible. Further,
since formal water markets have a legal basis, effective
regulation can be designed to address the issue of ecological
sustainability. These markets will be of significant relevance
to the urban sector, which has been suffering from acute
shortages of water, but has not been able to access informal
markets. Formal water markets can provide low cost solutions
to augmentation of water supply relatively quickly.
In recent decades India has witnessed rapid
growth in demand for water, particularly in domestic and
industrial sectors due to population growth, urbanisation,
industrialisation and rising incomes. This growth in demand
has not been matched by an increase in supply. The problem
is compounded by pollution of water, which has reduced its
suitability for various uses. At the same time, in traditionally
water intensive sectors of the economy such as agriculture,
costs of irrigation have increased significantly. Under
these circumstances, it is more important than ever before
to use water efficiently.
Private Response to Poor Public Provision for Household
Water
Laveesh Bhandari and Aarti Khare
Lack of funds, and generally poor municipal
governance has contributed to a situation where much of
urban India does not obtain 24 hour water. This has prompted
individual households to undertake self-supply measures
such as boring underground to access sub-surface water.
This has contributed to the dramatic fall in sub-surface
water levels and associated environmental damage.
In parallel, a large private sector is emerging
in water supply though illegally. Indian laws, partly due
to environmental considerations, do not allow private operators
to undertake water supply using sub-surface water. In fact,
policy has directly or indirectly, discouraged any type
of private sector activity in water supply. However, these
laws are proving to be un-enforceable due to inability of
the local governments to satisfy the demand for water. If
the private sector is included and not excluded from water
supply and in a legal manner, both coverage and environment
would benefit.
Conflicts in Indian Fisheries: A Property-Rights Based
Interpretation
V. Santhakumar
Issues of sustainability and distribution
in Indian fisheries have been attracting popular attention
within the country and abroad during the past two decades.
This was greatly facilitated by the several agitations of
traditional fishermen against coastal aquaculture, mechanised
trawlers, and foreign fishing vessels. It is in this context
that the institutional or property-right contexts of these
conflicts are analysed in this paper. The paper highlights
in each case, the major issues of conflict, and the demands
of, or potential solutions suggested by, different groups
of stakeholders. It considers that the institutional arrangements
adopted to tackle the problem should be the one that maximises
net-income generation in the long run and on a sustainable
basis. The cost of monitoring and enforcement, ability to
adapt to the technological change, and the political feasibility
of implementation should also become concerns in deciding
the nature of institutional arrangement. However, we believe
that the adoption of an inefficient arrangement (which do
not aim at maximising net benefits) for the sake of meeting
certain distributional requirements of today can hamper
the generation of overall benefits and can hence reduce
the ability to distribute in future.
History of Conflict over Forests in India: A Market Based
Resolution
Arnab K. Hazra (Rajiv Gandhi Institute for Contemporary
Studies, New Delhi, and visiting fellow Liberty Institute,
New Delhi)
Available
for download in PDF (219 Kb)
Since the British introduced laws governing
forests by claiming state ownership over these resources,
the dominant idea in the forest bureaucracy has been that
conservation is the sole prerogative of the state. This
notion undermines the concern and the ability of the forest
dependent communities regarding their own natural resource
and ways to preserve the ecosystem. The poverty and alienation
of forest dependent communities from their life support
systems have resulted in widespread forest degradation and
have placed the state forest departments in perpetual conflict
with these communities.
While there has been some attempts to redress
the situation by introducing more participatory conservation
programmes under state direction such as the Joint Forest
Management, it is a utopian idea that people would prefer
to preserve their ecosystem even while they go hungry. A
meaningful conservation can be expected only when a community's
property rights over the forests and thus rights on extraction
from the ecosystem they conserve, is recognised and protected.
This will significantly strengthen the bargaining position
of local community at multiple stakeholder negotiations.
Such negotiations provide the only way out of the conflict
over forest resources. This paper looks at the law and economics
of forests in India and identifies the existing legal framework
governing forest resources to be the root cause of such
conflicts.
The Basel Convention of 1989: A developing country's
perspective
Prasanna Srinivasan
This
paper examines the Basel Convention on hazardous wastes
and evaluates its economic and environmental impact on India.
It finds that the functioning of the Convention is hardly
consistent with practices of such multi-lateral fora. The
actions pursuant to the Convention agreements have not worked
towards its stated objectives. The measures and actions
of the Convention are inconsistent with the principles of
free trade and economic development, as practiced under
the World Trade Organization (WTO). And the Convention has
not led to development of improved environment related practices
and access to better technologies amongst its member countries.
The Convention, contrary to most multi-lateral for a, is
still identifying the subject matter of its agreement approximately
12 years after its formation - what is a "waste"
and what constitutes a "hazard"?
Will Public Interest Litigations and Citizens'
Actions Lead to Sustainable Development?
V. Santhakumar
In spite of having a large number of environmental
regulations, and designated administrative machinery, the
enforcement of such regulations is very weak in India. Moreover
it is known that whatever limited enforcement that is taking
place in India, is primarily due to the public interest
litigations filed by vigilant groups and citizens, and the
activist interpretations and interventions of the courts
of the country. However this paper argues that the failure
of the general rule of law as manifested in the long delays
taken by courts, and the poor law and order enforcement,
may create a situation in which such citizens' actions do
not lead to socially efficient outcomes. This in some sense
contradicts the conventional view, among many researchers
including those of World Bank and others that these citizens'
actions (which can also be called informal regulation or
private enforcement) result in beneficial outcomes.
Incentive-Based Approaches for Mitigating Greenhouse
Gas Emissions: Issues and Prospects for India
Shreekant Gupta
The key issue that the paper examines is the
initial allocation of permits and the potential gains from
trade that could accrue to India. The paper explains the
context for incentive-based approaches. It briefly describes
these policies as well as the international and national
mandate for their use in India. It further focuses specifically
on incentive-based policies proposed under the Kyoto Protocol,
particularly CDM and the problems associated with it. The
paper also undertakes another flexibility mechanism proposed
under KP, namely, emissions trading. The possibility of
using a domestic carbon tax and its synergistic effects
with a global emission-trading regime is also reviewed.
More general problems in implementing incentive-based policies
such as taxes and permits in India and possible solutions
are also mentioned in the paper. Finally the paper discusses
the principal guideline for implementation and conclusion.
From Sustainable Development to Sustained
Development
Barun S. Mitra and Rakhi Gupta
The main point raised in this paper is that
only economic development is sustainable. And an open market,
with free trade, induces competition providing an incentive
for technological innovation. This creates an environment
for sustained economic development. Consequently, there
is an improvement in economic efficiency and environmental
performance. Improvements in agricultural productivity through
trade and technology has led to lower environmental stress
as higher production are made possible from a lower acreage.
Likewise, more units of GDP are being produced with lower
energy intensity and emission. Higher consumption patterns
are leading to better waste recovery systems.
Sustainable Development Paradigm: Primacy
of the Apolitical
G. S. Benipal
In this paper the author traces the roots
of sustainable development to economic control instituted
by the socialist planning that saw the rise of apparently
apolitical technocrats. The environmental advocates of today
are following the steps of their socialist predecessors.
However, both fail to recognise the political nature of
the goals being set, and go about designing a delivery system
to achieve the objectives, on the basis of their apparently
technical skills. The author seeks to highlight the danger
to individual liberty, freedom of choice and democratic
institutions posed by this new breed of apolitical experts.
REGULATORY REFORMS
The Need for Structural Reform in Indian
Civil Aviation
Laveesh Bhandari
This paper examines the basic characteristics
and requirements of the Indian civil aviation sector for
positive and more profitable outcomes. The debatable issue
is the change of role of control over this sector from public
to private. High efficiency in this sector can be achieved
if the regulatory and policy system is deregulated and made
more flexible. The paper further discusses how the size
of the aircraft can increase the area covered and the frequency
of the flights. The paper discusses the characteristics
of the aviation sector and policy that could provide optimum
value addition to this sector in today's highly competitive
world.
The history of the aviation sector helps in
understanding the inability of the public sector in optimizing
profitable outcomes. Poor policy and regulation are the
key factors behind this sub-optimal performance of the air
sector. Case studies of the systems and deregulation in
three geographically large countries USA, China and Australia
are also conducted. The analysis on costing of the air transport
system highlights the high airfare price in India and low
profits compared to other countries. This leads to highly
inefficient and cost ineffective conditions. Finally, the
paper studies the future of the civil aviation sector in
India and the implication of removal of unnecessary rules,
regulations and procedures. The rules that are necessary
to impose should not kill private initiative.
SOCIAL ISSUES
Child Labour in India: Perspective and
Issues
Munmun Jha
For various reasons, some children have to
work. In this, children reflect their position in the society,
and also the nature of society itself. In the modern period,
as the nature of work has changed, so has the role of children.
Today child labour is seen by many as undesirable, a phenomenon
that needs to be rooted out. But the policy prescription
varies - from complete prohibition and compulsory schooling,
to regulation with qualitative support to phase out child
labour, to creating economic opportunities and providing
access to education that would make it possible for children
to stay out of the labour force.
In seeking to unfold certain perspectives
on child labour as they relate to India, this paper tries
to explore some specific questions. It looks at the definitional
aspects of child labour. It looks at the range of estimate
of the number of children working, and the condition in
which they work. Economic and cultural factors that may
have a bearing on child labour are analysed. In addition
the legal environment and the prospect for accepting certain
universal rights of children are suggested.
Lotteries & Gambling in India: Why Legalisation Makes
Sense
Rakseh Wadhwa
The paper examines the historical background
of the lotteries and gambling system around the world. The
origin of this can be traced right back to the story of
Mahabharat, which is pre historic. The world seems to have
experienced lottery or gambling at one point of time at
least. The paper gives a detailed history of gambling scenario
all over the world. Various countries have been identified
where gambling seems to be prominent right from the early
times.
The paper looks at legislative measures governing
lottery and gambling in India, and examines the need for
reforms aimed at greater flexibility and ensuring freedom
of choice for the consumers. The paper also examines the
popularity of lottery and gambling is prevalent in India
through Internet and popular TV game shows like KBC. The
paper also analyses a Canadian case study along with data
that shows the percentage of personal harm from gambling
is much lower compared to any other harm for e.g. driving
and food habits etc. The paper finally addresses the pro
of legalizing lotteries and gambling in India. The myths
about these issues have been addressed. Despite negative
opinions about the consequences of gambling, the actual
harm caused by gambling remains distant for most respondents.
TRADE
An Analysis of the Regional Trade Agreements
and the WTO Framework: Reconciling Free Trade Objectives
Debashis Chakraborty
Over 140 countries have accepted the multilateral
framework of the WTO. This is seen in the expansion of international
trade so much so that more than 90% of world trade is now
carried on between WTO member countries. Yet, in recent
years there has been a dramatic increase in the number of
bilateral and regional trade agreements between countries.
Today, there are about 140 regional trade agreements signed
by developed and developing countries in every region of
the world. This paper analyses the RTAs in the perspective
of WTO agreement, and suggests ways of reconciling the objectives
of free trade in both these developments.
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