BY PRAFUL BIDWAI
‘Scorched earth’ is the kindest phrase to describe the approach of the last budget (rather, vote-on-account) of India’s United Progressive Alliance in its inglorious second term. Finance Minister P Chidambaram savaged social-sector spending, cut productive capital expenditure by Rs1.5 trillion, and pampered the elite.
He even made a 31-percent cut in the current year’s allocation to schemes which benefit the poor and address long-neglected areas like health and education. The budget for school education was slashed by seven percent, sanitation by 46 percent, rural drinking water by 12 percent, and the National Health Mission by 13 percent.
In the coming year, health and education allocation will fall by about three-fourths, the agriculture budget will be almost halved, and rural development will get less than one-tenth of what was budgeted for 2013-14! True, some money will be transferred to the states, but overall social spending will decrease.
Even more deplorably, Chidambaram pampered the middle- and upper-class elite by reducing excise duties on consumer durables ranging from refrigerators and air conditioners to washing machines, DVD players, microwave ovens and vacuum cleaners. Computers/laptops too will become cheaper.
Similarly, Chidambaram tried to please nearly one million middle-class students by waiving interest on pre-March 2009 education loans. He targeted 2.5 million ex-servicemen through the one-rank-one-pension scheme. He also created a venture-capital fund for Dalit entrepreneurs – an elite target.
All these handouts pale beside the generous across-the-board excise duty reductions ranging from four to six percentage-points on two-wheelers, trucks and cars, including big cars and sport-utility vehicles (SUVs). The duty-structure is regressive: the larger and costlier the vehicle, the higher the cut!
Thus two-wheelers will be cheaper by Rs1,100-Rs3,000. But an entry-level Nano will cost Rs 4,500 less, and a Maruti Alto Rs10,000-Rs 12,000 less. Mid-sized sedans will be cheaper by Rs 24,000-Rs36,000. SUVs are favoured even more, and will become Rs 34,000-Rs 76,000 cheaper. Upper-end Audis will cost Rs 2-4 lakh less.
Never before has India seen such concessions for the automobile sector – not even five years ago when the Tata Nano was launched. This is only partially meant to boost the auto industry, whose sales have dropped somewhat over the past year. An equally important motive is to cultivate a middle class or upper middle-class constituency for the UPA. But it’s doubtful if that will improve its electoral chances much.
Society will pay dearly for this state-induced automobilisation – through greater road congestion, slower commuting speeds, horrendous air pollution, widespread health damage, and increased fatalities and injuries from accidents.
India has one of the highest rates of deaths from road accidents, estimated at over 140,000 annually – or about the same as deaths from AIDS-related causes. Road accidents in India claim one-fourth as many lives as cancer. India’s mortality rate per 10,000 vehicles is 10.5, compared to less than two in the developed world.
Indian cities are among the world’s dirtiest. The distinction of being the world’s most polluted city no longer belongs to Beijing, but to Delhi. Its PM 10 (particulate matter of dimensions less than 10 microns) and PM 2.5 (less than 2.5 microns) levels routinely exceed 200 or 300 units. The WHO safe limit is 25 units.
Other large Indian cities too have extremely high pollution levels, especially of PM 2.5 which readily penetrates the lungs. More than a third of their children have respiratory problems.
Cars, which account for less than 10 percent of commuter trips in Indian cities, contribute roughly three-fourths of the air-pollution load. Their number has annually risen by 10 percent-plus for two decades – driven by consumerism, the elite’s search for ‘status’, neglect of public transport, and relatively low-interest bank loans.
Most Indian cities suffer high and rising traffic congestion, which impedes vehicular movement, enormously wasting social time. Traffic speeds have slowed down by 30 to 55 percent over the past decade. Soon, vehicles will crawl at an average of 5-to-10 kilometres per hour.
The government is promoting cars as part of its Automotive Mission Plan, which wants India “to emerge as the destination of choice in the world for design and manufacture of automobiles and auto components”. This flies in the face of all rational urban transport priorities.
Cars are the most inefficient, expensive and polluting mode of road transport ever invented. In India, their ownership is under 10 for every 1,000 people. Yet they occupy the lion’s share (75 percent) of road space, meeting only about five percent of the travel demand. Buses, by contrast, occupy five to seven percent of space but deliver 45-60 percent of commuter trips.
This is unacceptably iniquitous. The cost of the land on which roads and flyovers are built, and the expense of their construction and maintenance, add up to several thousands of rupees per square metre. But car-owners get to use them virtually for free.
The lifetime road tax on cars works out to a laughable annual average of Rs300. The government taxes buses 43 times more heavily. The tax burden per vehicle-kilometre is 2.6 times higher for buses than for cars. This is doubly perverse: a car consumes almost six times more energy than a bus per passenger-kilometre.
The government grants free parking space to cars, usually 20-25 square metres, but treats poor slum-dwellers occupying even less space as trespassers worthy of summary eviction. If the true costs of space were to be recovered, a car-owner would have to pay at least Rs 50,000 annually. Worse, car-owners are increasingly enclosing and privatising pedestrian pavements.
The government has added to all these injustices in four major ways. First, it has encouraged SUVs, which have truck-level emissions, and cause a disproportionate number of accidents. These should be banned altogether.
Second, the government has allowed cars to use diesel – and steal the subsidy given to this supposedly goods-transport fuel. Cars now guzzle 50 percent more subsidy than public-transport vehicles. About half the cars sold in India are diesel cars. Diesel is a far more polluting fuel than petrol. Private vehicles shouldn’t be allowed to use it.
Third, India is delaying to 2021 the imposition of stricter (low-sulphur) emissions norms called Bharat Stage-V which were to be in force by 2016. Coupled with lax car safety standards – four out of five of India’s highest-selling small cars, including the top-selling Maruti Alto and the Nano, recently failed crash tests based on UN norms – this spells less safety on Indian roads.
Fourth, India will soon have a new flimsy breed of four-wheelers called quadri-cycles, which won’t undergo even the minimal safety tests that cars are expected to pass. This is a suicidal move. The government claims that quadri-cycles will only be allowed to ply in the cities. But it’s hard to believe they won’t invade highways and cause more accidents.
India must at once correct course by adopting policies similar to those tried in Singapore, Shanghai and Beijing, including taxing cars heavily, limiting/auctioning additional licence-plates granted annually, restricting sales only to those with proof of parking-space ownership, banning use of even- and odd-numbered cars on alternate days, levying high parking fees, and instituting vehicle-free zones and days.
There’s no alternative to such tough measures – and to promoting safe, efficient, affordable, non-polluting and reliable public transport. Automobilisation is a dangerous distraction from this priority.
-the writer, a former newspaper editor, is a researcher and rights activist based in Delhi
-courtesy: The News International