Thursday, December 29, 2011

Understanding theme 1 of the Rio+20: “A green economy in the context of sustainable development and poverty eradication”

Rio+20 marks the 20thanniversary of United Nations Conference on Environment and Development (Rio 1992) and the 25th anniversary of the Brundtland Report. Sustainable development has been the overarching goal of the international community since Rio 1992. However, two decades on, the world is far from realizing the vision of Rio. The upcoming UNCSD is therefore, an opportunity for world leaders to address the economic, social and environmental crisis gripping the world today. Theme 1 of the conference is as follows:
“A green economy in the context of sustainable development and poverty eradication”
The concept of green economy has moved into the mainstream of policy discussions, however, it is not a concept that enjoys widespread agreement and there is substantial ambiguity in its definition. The following definitions of green economy/ green growth exist in the literature:

“The green economy approach is an attempt to unite under one banner a broad suite of economic instruments relevant to sustainable development. (UNCSD, 2010)”

“A green economy is one that results in “improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities. (UNEP, 2011)”

“Green growth is environmentally sustainable economic progress to foster low-carbon, socially inclusive development. (UNESCAP )”

In a nutshell, the concept of green economy amalgamates several existing concepts such as durable economic activity, reduced environmental impact, sustained growth in high quality jobs and reduced poverty.However, it is not clear how the green economy approach adds value to the sustainable development paradigm. Discarding sustainable development without a proper understanding of what the green economy approach entails might stall the progress on sustainable development particularly in the developing world where the achievements have not been impressive on many dimensions of sustainable development.

The critiques of this concept imply that the social pillar of sustainable development receives inadequate attention and that the environmental protection agenda, which is dominant, could negatively impact economic growth. As such, recognising the different stages of development of nations and the differences in environmental endowments and challenges, each country would need to define its own strategy for achieving a ‘green economy, and identify both the opportunities, challenges and needs in doing so.

The green economy approach presumes a higher rate of growth, poverty alleviation and social equity. However, some of the difficult but important questions that need to be answered are: how the green economy approach would contribute to poverty alleviation and achievement of millennium development goals: what would be the impact on economic growth in developing countries; how to identify and deal with trade off; how to garner resources for the transition to a green economy; how to handle the transition from the present to the greener economy; what are the elements that should be incorporated in the green economy concept so that it adequately addresses the issues of poverty and equity?

Wednesday, August 17, 2011

Why Dr Manmohan Singh is wrong

On the eve of India’s 64th independence day, Anna Hazare appealed to the people of India to join the peaceful protest against corruption and demand a strong Lokpal Bill which will reduce corruption from the Indian society. His speech became the biggest news of the day and overshadowed Dr Manmohan Singh’s address to the nation. In the last one week he has said time and again that he has no magic wand against corruption, Parliament has the sole right to make laws and protests will affect India’s image and economic growth. The fact he had no power over his corrupt colleagues is clear to the entire nation. He failed to garner support from fellow Parliamentarians. All the opposition parties critised Anna Hazare’s arrest. The main opposition party has targeted him on grounds of corruption in Common Wealth Games and 2G spectrum allocation even before Anna Hazare started his fast in April. The credibility of his government lowered further because of the active smear campaign launched by his party colleagues. The new charges against his government are arrogance, murder of democracy and brute force. Since use of police force and “I will not submit to the fancies of activists” attitude proved counterproductive, he tried to lean on the economic pillar. Indeed, he is widely respected in India and abroad as a good economist. He has also been hailed as the man who abolished license raj, liberalized India and put the Indian economy on a higher growth trajectory. However, the common man has dismissed his theories on the resilience of Indian economy in the face of global imbalances. Most of the protesters refuse to accept his argument that global factors are responsible for high inflation and are critical of Government’s supply side management. No one in India except the policy makers is convinced about India’s economic progress. Most of the urban residents are critical of the government’s indifference towards agrarian distress. Therefore, his third line of defence also fails. Dr Singh is absolutely wrong because protest against corruption is not anti-growth, on the contrary, corruption is the greatest obstacle to economic and social development. It undermines development by distorting the rule of law and weakening the institutional foundation on which economic growth depends. Corruption in the Common Wealth Games severely dented India’s image and most of the Indians felt humiliated when foreign players opted out of the games. Moreover, the ills of corruption are particularly severe on the poor because they are most reliant on the provision of public services and are least capable of paying the extra costs associated with bribery, fraud and misappropriation of economic privileges. He needs to understand that Indians are no more content with political freedom and economic prosperity of the select few. They demand accountability from the government which they have elected not blows of police lathis. Although many of the protesters do not know of the nuances of the Lokpal Bill and how it is expected to reduce corruption, they have united against the governance deficit in his government. Instead of trying to kill the movement with a heavy hand, he should admit the follies of his government and try to regain the confidence of Indian society as “Mr Clean”. At the moment he unfortunately does not have many friends outside his cabinet.

Friday, January 7, 2011

Characteristics of urban transport in India

Introduction
India is one of the fastest growing economies of the world. The growth rate of the Indian economy averaged 8.5% from 2005-06 to 2009-10. The key driver of India’s growth has been high growth in industrial and services sector. The industrial and the service sectors grew at 8.2 and 8.7 per cent respectively as compared to 0.2% growth in agriculture during 2009 – 10 (MoF 2010). The increasingly urban character of growth has led to a rapid growth in transportation activity in Indian cities.

Increasing per capita incomes have had direct impact in terms of growing motorization rates in Indian cities, which has been the precursor to most of the urban transport related challenges that these cities face. The supply of transport infrastructure and services, by comparison, has lagged far behind demand. Most transport facilities are used far beyond their design capacity.

The Urban transport systems in large developing cities like India face major challenges, due to high rates of motorization, equity issues, importance of intermediate public transport such as three wheelers, vans etc and high congestion levels. When the urban transport system experiences major difficulties, consequences are felt by households, businesses, and the urban community at large. After a point, transport may even become a binding constraint on both economic growth and social development along with increased negative impacts on health and on the environment. Therefore, sustainable transportation is a prerequisite for sustainable growth.

Characteristics of urban transport in India
India’s transport crisis has been exacerbated by the extremely rapid growth of India’s largest cities in a context of low incomes, limited and outdated transport infrastructure, rampant suburban sprawl, sharply rising motor vehicle ownership and use, deteriorating bus services, a wide range of motorized and non-motorized transport modes sharing roadways, and inadequate as well as uncoordinated land use and transport planning. In the following section I discuss the major issues of urban transportation in India:

a. Growth trend of motor vehicles in India
The economic growth, increasing disposable income, and increasing urbanization is creating greater demand for transport and the number of vehicles on India’s road system is growing at a rate of 10% per annum. India had 89.6 million registered motor vehicles at the end of 2005/06.Personalized modes (two wheelers and cars) accounted for about 85% of the total number of motor vehicles in the country. A further break up of motor vehicle population reflects the dominance of two-wheelers with a share of more than 72% in the total vehicle population, followed by passenger cars at 13%. In contrast to personal vehicles, the percentage share of buses in the total number of registered vehicles has declined from 11.1% in 1951 to 1.1% during 2006, which indicates slow growth in public transport modes.

Economic development has historically been associated with an increase in the demand for transportation and particularly in the number of road vehicles. This relationship is also evident in India as outlined above. However, pattern of motorization in India is very different from that of the developed countries. In spite of the high rate of growth of personalized vehicles in India in the last decade the current vehicle ownership in India is still very low compared to industrialized countries.

Dargay et al (2007) examined the trends in the growth of the stock of vehicles for 45 countries and made projections till 2030 with the help of a Gompertz function which was used to estimate the relationship between vehicle ownership and per capita income. They estimated the stock of vehicles and vehicle ownership to be 156 million and 110 vehicles per thousand population respectively in India in 2030. These figures may be regarded as gross underestimates because they included only 4-wheeled motor vehicles. The classic S-shaped curve is based on developed countries experience where two and three-wheeled motor vehicles did not play an important role. In India and in many parts of Asia two wheelers account for over 70% of vehicle population. The four Asian countries of India, China, Japan and Malaysia have much higher levels of two wheeler penetration as compared to developed countries, therefore, with motorcycles as a much more affordable vehicle type, motorization levels in Asian countries may increase at even higher rates than found in the developed world.

b. Equity issues
With 25.7% of the urban population living below the poverty line, the mobility problems of the poor need special attention. Although India experienced very high rates of motorization in the past decade due to higher growth rates witnessed in the last decade, the growth has bypassed a vast majority of the population. The following table shows that a mere 4.6% of the urban households owned a motor car whereas 41.7% of the urban households owned a bicycle. Most of the poor urban households cannot afford any private motorized transport and are forced to walk or cycle long distances. About two-thirds of the trips in selected Indian cities were by walking or cycling as compared to 10-20% of the trips by private motorized transport (mainly cars and motor cycles). Similar results were found by Baker et al (2005) for the city of Greater Mumbai. Baker et al did a survey of 5,000 households and found that 44% of the commuters in Mumbai walk to work and the proportion of poor people who walk to work is even higher at 63%.

Table 1: Percentage of urban households possessing a specific vehicle
Year Bicycle Two wheeler Motor car
1993-94 37.1 11.6 1.2
1999-00 39.0 18.4 2.7
2004-05 41.7 26.0 4.6
Source: NSS 2005

However, transport policy in India continues to focus on the needs of the urban elite and middle class. Most of the funds are allocated to roadway expansions and improvements such as construction of flyovers, multi-laning of existing roads etc. which encourage the use of personal vehicles and ignore the needs of the poor. Urban transport infrastructure does not include any facilities for walking and cycling. With the exception of few cities, most of the major road networks have not been provided with footpaths and bicycle lanes.

c. Importance of intermediate personal transport (IPT) and paratransit
Public transport facilities are inadequate in most Indian cities. Therefore, IPT modes like auto-rickshaws, maxi cabs and motor cabs assume importance to meet the travel demand, particularly in the smaller cities. There are also locally contrived mechanical contraptions (commonly called jugad) which are used for ferrying goods and passengers in most cities of India. IPT are preferred by urban residents because they provide greater flexibility, frequency, better access and comfort over existing public transport.

Auto-rickshaws/passenger three wheelers are a very important mode of travel in most of the Indian cities. The share of passenger three wheelers in total stock of passenger vehicles namely two wheelers, passenger three wheelers, cars and jeeps, taxis and buses was 4% in 2006. The share of passenger three wheelers is highest in Cochin (43%) followed by Patna (10%) and Bombay (8%).

Public transport is the predominant mode of transport in mega cities while the IPT modes are popular in smaller cities. This is because larger cities have better public transport facilities as compared to smaller cities. The share of trips by IPT modes was higher than public transport in cities with population of 0.1-0.5 million in 1998 but the share of IPT modes in total trips declined with increase in city size.

d. High congestion levels
Traffic congestion is one of the most pressing transport problems in Indian cities despite the fact that vehicular ownership rates in most Indian cities is much lower than developed countries. The road way speeds for motor vehicles has declined in most cities and the average travel time has increased greatly. The stop-and-go traffic flow caused by congestion also wastes energy and increases pollution. Moreover, roadway congestion increases the likelihood of crashes.

The three main reasons for increasing congestion levels in the Indian cities are as follows:

1. Uneven distribution of vehicles: The vehicular penetration of India at 22 vehicles/1000 persons is quite low as compared to the developed countries like U.S.A. (675/1000 persons) and Japan (598/1000 persons). However, even at such low levels of motorization congestion has become a major problem in Indian cities because of uneven distribution of vehicle population. In 2006, the twenty-three metropolitan cities in India, each with over one million population, accounted for about 28% of the total vehicles registered in the country. About 53% of the total cars and 31% of the two-wheelers in the country were confined to these metropolitan cities in 2006.

Moreover even within metropolitan cities vehicles are distributed very unevenly. In 2006, Delhi, Mumbai, Kolkata and Bangalore accounted for 48% of the total registered vehicles in metropolitan cities. Delhi had the highest stock of registered motor vehicles at 4.48 million and its share in the two wheeler and car population in metropolitan cities was 16% and 30% respectively in 2006.

Congestion levels are likely to rise in the future as the second tier cities like Coimbatore (12.9%), Madurai (10.9%), Nagpur (14.6%) and Vishakhapatnam (17.2%) posted higher average annual growth rates as compared to Delhi (4.3%) and Mumbai (6.2%) during the period 2001 to 2006. Ahmedabad experienced the highest growth rate at 16 % during the same period. (MORTH 2009)

Heterogeneous traffic: Indian cities are characterized by the co-existence of slow non-motorized modes such as bicycles, cycle-rickshaws, pedestrians, and animal-drawn carts along with faster motorized modes such as cars, trucks, buses, and auto rickshaws. Slow moving transport modes reduce the average motorway speeds for motor vehicles and increase travel time of urban commuters. They also increase the probability of accidents.

2. Inadequate transport infrastructure: The motor vehicle population in metropolitan cities of India increased from 7.42 million in 1991 to 21.06 million in 2006, registering an average annual growth rate of 8.4%. (MORTH 2009) However, the length of urban roads increased from 186,799 km in 1991 to 301,310 km in 2004 at an average annual growth rate of 3.7%.(TERI 2009) Moreover, most roads in Indian cities are narrow, with only one lane in each direction. Barring a few cities, roads are generally in a state of disrepair and there is a general lack of modern traffic signals and signage.

The addition of more capacity in the form of roads and flyovers has not been able to meet surging demand by private vehicles. These measures have only succeeded in shifting the point of congestion further up the traffic stream, without really improving the overall performance of the network.