Editorial 1: Building a blue economy: What India can learn from China
Context: China owns the world's largest deep-water fishing fleet, which also serves as a maritime militia assisting the Chinese navy and coast guard. India too must raise its own fleet and build modern harbours to further its economic and security goals
Blue Economy
- According to the World Bank, the blue economy is the "sustainable use of ocean resources for economic growth, improved livelihoods, and jobs while preserving the health of ocean ecosystem." European Commission defines it as "All economic activities related to oceans, seas and coasts.
- Owing to its massive coastline of over 8,000 km and a vast network of rivers, fisheries have always played a significant role in India's economy. Currently, this sector provides livelihood to more than 2.8 crore people within the country.
The fisheries sector has witnessed three major transformations in the last few years:
- The growth of inland aquaculture, specifically freshwater aquaculture.
- The mechanization of capture fisheries.
- The successful commencement of brackish water shrimp aquaculture
Problems faced by Indian Fishing sector:
- Indo-Sri Lankan dispute over fishing rights in the Palk Strait.
- High Rate of Illiteracy
- Underemployment
- Absence of Mobility of Labour to Other Sectors
- High per capital earnings.
- Dwindling fish stocks, rising fuel costs, and growing tensions
- Most of India’s fisheries exports are at a low level of value addition
Case Study of China
- Since the dwindling availability of farmland forced China to become a net importer of food grain, it has mobilised the fishing industry to meet the rising demand for protein in the Chinese diet.
- Consequently, China is today a “fishery superpower”, which owns the world’s largest deep-water fishing (DWF) fleet, with boats that stay at sea for months or even years. In 2016, while China consumed 38 per cent of the global fish production, its DWF fleet brought home only 20 per cent of the world’s catch.
- To bridge this gap, China had begun distant deepwater fishing, as far back as in 1985, and, with an eye on “protein and profit”, struck contracts to fish in the exclusive economic zones (EEZ) of other many countries in Asia and Africa.
- Interestingly, China also uses a part of its fishing fleet as a “maritime militia”, which assists the navy and coast guard in their task.
Opportunities offered by Fisheries for India
- For India too, fish, being an affordable and rich source of animal protein, is one of the healthiest options to mitigate hunger and malnutrition.
- Since Independence, India’s marine fishery has been dominated by the “artisanal sector” — poor, small-scale fishers who can afford only small sailboats or canoes to fish for subsistence. India’s artisanal fishers deliver only 2 per cent of marine fish to the market, while 98 per cent is caught by mechanised and motorised craft.
Way Forward
- Reaching out across the Palk Strait to form an “Indo-Sri Lankan Fishing Corporation” under this Yojana, with a deepwater fishing fleet and dedicated fishing harbours, could not only provide a huge boost to the fishing industries of both nations, but also remove an unwanted irritant in bilateral relations and send out a positive message of SAGAR: “Security and Growth for All in the Region”.
Editorial 2: The poverty debate: Was there really a decline in poverty during the pandemic years?
Context: Frequent interference in the statistical system through changes in survey and questionnaire design, suppression of data and delaying the release of crucial data make it difficult to have a correct assessment of what really happened
Introduction
- Poverty refers to the lack of adequate financial resources such that individuals, households, and entire communities don't have the means to subsist or acquire the basic necessities for a flourishing life. This means being so poor as to struggle to obtain food, clothing, shelter, and medicines.
- Poverty is both an individual concern as well as a broader social problem.
- On the individual or household level, not being able to make ends meet can lead to a range of physical and mental issues.
- At the societal level, high poverty rates can be a damper on economic growth and be associated with problems like crime, unemployment, urban decay, education, and poor health.
Claims of the Report
- A few days ago, this paper carried a report (IE, April 4, “After pandemic, poverty kept falling every quarter from July-September 2020”) highlighting the striking claims made by Arvind Panagariya and Vishal More (hereafter PM) that there has been a reduction in poverty during the pandemic year of 2020-21 when compared to the previous year.
- The year 2020-21 was ravaged by two severe waves of the pandemic and the associated economic disruptions caused by the lockdowns. And the economy contracted by 5.8 per cent in 2020-21.
- Yet PM’s paper makes this startling claim based on data on consumption expenditure collected as part of the Periodic Labour Force Survey (PLFS) conducted from 2017-18 onwards.
- There are a number of recent papers that have come up with divergent claims on trends in poverty, showing both a rapid decline in poverty as well as a sharp increase.
Attempt to use PLFS data
- The attempt by PM to use PLFS data is not new, but they do deserve compliments for reiterating that the PLFS data is fully comparable to the earlier employment-unemployment surveys (EUS) of the NSO and that it “suffers from no known flaws of design and representativeness”.
- They are also right to point out the superiority and credibility of publicly available data with “benefit of scrutiny and oversight by scholars and statisticians” as against privately collected data.
- PM also rightly emphasise the necessity of using comparable estimates of consumption expenditure to arrive at any correct estimate of poverty.
- Poverty estimates in India have always been based on consumption estimates from the NSO, particularly based on the consumption expenditure surveys (CES), with the last official poverty estimates being for 2011-12, even though a comparable consumption survey was conducted in 2017-18.
- The latter was junked by the government without any valid reason, denying the benefit of scrutiny and oversight of scholars and statisticians — a principle the NSO has followed since the surveys began in the 1950s.
- However, leaked reports are available and these show a rise in poverty between 2011-12 and 2017-18, driven by a sharp 5 percentage point increase in rural poverty and a small decline in urban poverty. This incidentally remains the only valid and comparable poverty estimate for any poverty analysis after 2011-12.
- Independent data from multiple sources on wages, incomes and consumption of durables confirm the distress in the economy, especially during the pandemic years. But even the PLFS data, which PM use to argue in favour of poverty reduction, has enough indicators to show otherwise.
- As the PLFS data show, real incomes and consumption have declined after 2018-19, real regular wages have declined since 2011-12 and there is an increase in distress employment.
Issue, not only an Academic one!
- The issue of what happened to poverty after 2011-12 is not just an academic issue, but is also crucial for policy.
- Frequent interference in the statistical system through changes in survey and questionnaire design, suppression of data and delaying the release of crucial data are only making it difficult to have a correct assessment of the reality as it exists.
- While it does affect the credibility of the statistical system, the absence of official estimates on poverty is also a reflection of the lack of political priority of the government on such a crucial indicator.
Conclusion
- Currently, a survey on consumption expenditure is being canvassed by the NSO which again follows a completely new methodology and schedule. While it may provide another set of estimates of consumption expenditure, it is unlikely to help resolve the poverty debate.