Daily News Compilation (HINDU) for 5th June

Fighting for survival

Some facts highlighting the sorry state of our health system:

• Of the three million neonatal deaths globally in 2012, some 779,000 were in India (India ranks number 1 here also)
• Also, globally there were 2.6 million stillbirths in the same year, of which 600,000 were in India. 
• Of the one million newborns dying globally on the first day of birth, nearly one-third are in India.
• The country, which had a neonatal mortality rate of 29 per 1,000 live births in 2012, recorded an average annual rate of reduction of just 2.6 per cent during 1990-2012. According to papers published recently in The Lancet , India, Nigeria and Pakistan registered the “slowest rates of progress” in reducing neonatal mortality.

According to a 2012 WHO report, India is one of the 10 countries with an estimated 100,000 to 250,000 preterm births, as in 2010. The high number of preterm births is one of the reasons for the very high numbers of newborn deaths in the country — preterm births cause about 50 per cent of neonatal mortality. 

Some steps taken :

• Starting 2006, over 500 special-care newborn units have been set up in district hospitals, and about 600,000 admissions take place a year. 
• Thanks to initiatives such as cash transfer, institutional deliveries have increased since 2006. 

Yet, a concomitant reduction in infant mortality has not been achieved; many deliveries still take place at home, especially in the States of Uttar Pradesh and Bihar. 

Steps required:

• need to increase the number of well-trained birth attendants. 
• Also, the lack of well-trained healthcare workers and well-equipped healthcare centres has proved to be a “barrier” to improving newborn survival. There is, hence, an urgent need to improve the quality of care. 

What must be borne in mind is that many of the initiatives taken to save neonates’ lives would also help in reducing maternal mortality. With 50,000 deaths, India has the highest maternal mortality in the world.

For quicker decision-making

News: abolishment of the system of having Empowered Groups of Ministers and Groups of Ministers.

A press note issued by the Prime Minister’s Office said this would empower the Ministries, expedite decision-making and usher in greater accountability. 

The mechanism of EGoMs and GoMs had been created by the first NDA government of Atal Bihari Vajpayee to tackle complex policy issues and resolve the clash of interests that are inevitable in a democracy, more so in a coalition where inter-ministerial turf wars are harder to resolve. However, under the UPA it often became an instrument to delay decisions. 

While this decision should restore coherence in the functioning of the government, especially as the BJP’s decisive electoral mandate will ensure it is not hampered by difficult coalition partners, Mr. Modi must guard against administration by fiat. The Congress, citing the PMO press release that has asked all Ministers who have difficulties in deciding issues relating to their own Ministry to refer them to the PMO and the Cabinet Secretariat for resolution, has cautioned that this should not lead to an unhealthy “centralisation of power” and an “autocratic regime in the future.” An omniscient super-PMO must not destroy the Cabinet system that envisages decisions through consensus. 

Finance Ministry mulls nodal agency to take over bad loans 

The Finance Ministry is considering a proposal to set up a National Asset Management Company, which may act as a nodal agency, for taking over bad loans of banks and help revive sick units.
The public sector banks can jointly put in capital to form such an entity, which could act as an aggregator of NPAs and clear such assets quickly.
Once set up, the proposed National Asset Management Company can pick up large stressed assets entirely from a consortium instead of the normal practice of a partial takeover.
Stressed assets have been on the rise due to the economic slowdown and the delay in infrastructure projects. There is also a proposal to finance the acquisition of bad assets. In such cases, bank finance would be made available to a financially strong buyer to acquire stressed assets or a sick company.
The Finance Ministry has asked public sector banks to act tough in case of willful defaulters and has suggested that they go in for a change of management of defaulting companies.

Some facts:

• The top 30 NPAs of PSBs account for 40.2% of their gross bad loans.
• Bad loans of PSU banks rose by 28.5 per cent to Rs.1.83 lakh crore in last two quarters.

RBI bi-monthly monetary statement

Travails of renewable power in Germany

Germany has invested heavily in renewable energy in past two decades. Between 2000 and 2011 electricity from renewable sources grew from 6.8 to 20.5 per cent of total electrical consumption — nearly tripling the amount of power coming from sources like wind and solar.

Virtually every one who owns a roof in Germany erected solar panels, produced power and sold the excess back to the utility at fixed prices guaranteed for decades. But this transition to renewables in not so smooth and is attracting a lot of criticism.

Severe criticism :

• Many think Germany’s pro-renewable energy policy is bad for the consumers, producers and the environment. The only people who benefit are the homeowners and the solar panel installation companies.
• Massive construction of new capacity required huge investment but electricity output from renewables especially from wind and solar grew at a sluggish rate. The spiraling cost of the renewables has sparked a backlash, including government proposals to slash subsidies and deployment rates.
• Germany is been avoiding blackouts-by opening new coal and gas fired plants to endure the peak-load. Renewable electricity is proving so unreliable and chaotic that it is starting to undermine the stability of the European grid and provoke international incidents.
• Large-scale photovoltaic solar power is unmanageable and is causing severe grid fluctuations. The technology for grid-scale electricity storage does not yet exist. German Utilities are replacing lost nuclear power with “lignite, a cheap, soft, muddy- brown... form of sedimentary rock that spews more greenhouse gases than any other fossil fuel.

Capacity factor is the amount of electricity, a generator produces in a year divided by the amount it will produce if it ran at full capacity for all 8,760 hrs a year. It is a very important marker for the viability of any energy source.
In Germany, during 2012, CFs were for solar: 11; wind: 17; fossil fuel: 80 and for nuclear: 94.

• Germany has subsidized its renewable energy expansion by enhancing the power tariffs and justifies it through the “polluter pays principle”. Electricity tariffs are the highest in Europe. Almost one in five German industrial companies plans to or has shifted capacities abroad because of cheaper electricity costs.

Lessons for India:

• the annual need of power in India may be met through renewable energy sources alone. However, because of the intermittent nature of solar and wind power; there is a serious mismatch between the diurnal variation of electricity generation by renewable sources and the demand for electricity. 
• India must promote all modes of power generation including solar and wind. Copious sunshine and abundant wind may lead to over production in the grid. 
• Balancing the grid may be a challenge. Central Government must organise a systematic review of the challenges to arrive at India- centric solutions.

Will tax hike reduce tobacco consumption in India?

India is the second highest consumer of tobacco products in the world — nearly 35 per cent of the adult population consumes tobacco products. Tobacco consumption kills one million Indians annually; the global burden is 5.5 million.

Health Ministry recently said it supports higher taxes for cigarettes and tobacco products so they become very expensive and thereby reduce consumption.

The author disagrees with this argument saying that taxation practices in India and developed countries are quite different. The reasons are:

• 98 per cent of beedis available in the market are handmade though mechanisation is possible as handmade beedis are taxed just Rs.12 per 1,000 sticks while machine-made ones are taxed Rs.30 per 1,000 beedis.
• Beedi manufacturers don’t have to pay any tax if they produce less than two million beedis per year. Therefore, number of small-scale beedi manufacturers has reduced by more than 50 per cent with a concomitant increase in households involved in beedi rolling.
• In the case of cigarettes, unlike the system followed abroad, the taxation in India is based on the length of the cigarette. Since longer cigarettes attract more tax, consumers simply shift from longer cigarettes to shorter ones.
• The taxation structure in India is not linked to inflation. This makes any increase in tax irrelevant over a longer period. Tobacco products become cheaper relative to income affordability.

Consumption can be reduced substantially through taxation only if India changes the taxation structure. Changes needed are:

• Ensure that excise duty is “consistent across tobacco products” so as to prevent product substitution.
• Taxation of all tobacco products should be inflation-adjusted and corrected annually.
• The tax on cigarettes is about 43 per cent of the retail price. This is way below the WHO’s recommended excise duty of 70 per cent of the retail price. There is huge room for the government to increase cigarette tax.
• Removing the differential tax system between handmade and machine-made beedis.
• Remove the tax exemption to those who produce less than two million beedis a year.

Tinkering with the beedi taxation system and increasing taxes on beedis will be the most difficult part. However, huge gains will accrue if that is done. Generally People from the lower socio-economic stratum consume beedis hence consumption will come down quickly if beedi prices are increased.

New light on ocean warming, rainfall

For the past 30 years, it was believed that there is a threshold of temperature (29 degrees C) beyond which any increase in sea surface temperatures (SSTs) does not significantly affect the variability of rainfall over the Indian Ocean.
Now, this classic hypothesis based on a study published in 1984, has been challenged.
The New study states that there is a direct, statistically linear relationship between SSTs and rainfall, and that rainfall increases along with increase in SSTs, over the entire range of possible SSTs over the Indian Ocean (26-32 degrees C).
This understanding is significant in a changing climate scenario, where the SSTs are increasing. The earlier belief was based on studies in which SSTs and rainfall were analysed simultaneously and it was found that beyond 29 degrees the rainfall showed no substantial variability.
The new study using satellite data over the Arabian Sea, Bay of Bengal and South China Sea found that there is a time-lag between SST rise and rainfall increase. The lag is 5 days for Arabian Sea, and around 12 days for Bay of Bengal and South China Sea.
The difference in the lag is attributed to the spatial variance in surface convergence and uplift over these regions.
The converging warm moist air near the surface has to rise or uplift as it is less dense (lighter) than the air above. The uplift of the warm moist air results in the convective activity (cloud formation).
The winds and the convergence associated with the summer monsoon are stronger over the Arabian Sea, while they are relatively weaker over Bay of Bengal and the South China Sea. This probably leads to a faster uplift and cloud formation over the Arabian Sea while delaying the response over the Bay and the South China Sea.
The results of the experiments indicated that rainfall over the monsoon basins will continue to increase in a global warming scenario.

Why is it not possible for mosquitoes to spread AIDS?

HIV does not survive outside the body for very long, and it does not replicate in insects.
Mosquitoes transmit malaria and other infections when they inject saliva into the victim.
Unlike a syringe, the mosquito delivers salivary fluid through one passage and draws blood up another. As a result, the food canal is not flushed out like a used needle, and blood flow is always unidirectional.