Opinion On Rules: Environment and Others

My predecessor,Pitamber Pant had written Mrs. Gandhi’s famous Stockholm Speech on poverty is an environmental problem and had fascinating correspondence wither literally from his death bed. In the final Fifth Plan in the mid seventies we introduced for the first time a table of balance reserves of some non renewable resources at terminal levels of consumption.

The idea was to sensitize the country not to live on the future generations and to conserve and use wisely. The Prime Minister loved it and that became the institutions strength in dealing with such issues. We were to argue for limited imports of coking coal as also imports of power grade coal in port towns away from the coal mining centers. All that became orthodoxy soon.

In the mid eighties I was back in the Planning Commission,this time as a member. A young consultant to the Energy Policy Committee,chaired by K.C.Pant argued that we should allow import of timber freely and without import taxes to save our forests. He had a MIT degree and was very persuasive.

The Planning Commission pushed his ideas,which were accepted and also supported a ban on logging which we imposed long before the World Bank’s Forest policy in the nineties. That consulatant’s name was Jairam Ramesh. The Planning Commission must have very weighty reasons to oppose rule based environmental regulations. These are generally less damaging because they allow for less corruption than discretionary policies,the damage of which we have seen lately and it would be useful to know them so that there can be debate. I must declare a personal interest in all this since we have been allotted some Coal India shares.

The other objection to rule based systems is the objection to tariff based bidding on power projects reportedly by parastatals. When I was in Delhi the rumuor was that the objections are not from the power parastatals but power generation private companies who find the profits from tariff based bidding very meager and want more comfy bidding procedures.

Again I have argued in my columns that tariff based bidding rules have been very influential and the replication of the Delhi privatization bidding is the name of the game so some discussion would be useful. Trasparency here would avoid some of the murkiness on fuel pricing Radigate gets into.

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