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Posts Tagged ‘green economy

Taxing knowledge and nature

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The success of GST cannot come at a cultural cost to India. A well-informed tax system must widen the dialogue finance has with handicrafts and hand weaves. [This article has been published by The Pioneer, New Delhi.]

On 15 September, in a notification about the Central Goods and Services Tax (GST) Act 2017, the Central Board of Excise and Customs exempted “casual taxable persons making taxable supplies of handicraft goods” from requiring to be registered under the Act. The previous day, a similar exemption was given for the Integrated GST, and which concerns the inter-state supply of handicraft and handloom goods, a traffic that contributes a substantial livelihood to many crafts households.

There are a few conditions explained in the stilted language such notifications employ, such as value of sales, the need for craftspeople and artisans to obtain a Permanent Account Number (PAN) and fill out an e-way bill.

Yet these corrections to GST, made by the Ministry of Finance, are the first signals that the entreaties made to the Government of India by craftspeople and artisans are at last being heeded and responded to. They were made, and took shape in the form of a representation, titled “A plea for reconsidering GST rates for the crafts sector” and was submitted in July 2017 to the Prime Minister’s Office.

The reason this representation had been discussed, compiled and delivered was the ruinous effect on the handicrafts and handloom sector of the Goods and Services Tax (GST), which came into force on 1 July 2017 under the slogan, “the single biggest tax reform in the history of the nation”. The representation to the PMO pointed out that this single biggest tax reform had been drafted, passed and was being implemented without a single consultation with the largest national number of craftspeople and artisans in the world.

The representation went on to explain that the GST consultations had not included or even recognised “the widespread existence of crafts people, practices and products based on centuries old histories and skills, which give India a unique place in the world and brings economic benefits to dispersed rural artisans”.

Handicrafts and hand weaves provides employment and livelihood which is, in terms of numbers, next only to agriculture (indeed the two are concomitant, being based on nature and the application of knowledge). While many crafts and artisanal products are seasonal, estimates are that over 110 lakh persons are so engaged, with more than 43 lakh in the handloom sector alone.

Click for a pdf file of this article (courtesy The Pioneer).

The GST crisis for handicrafts and hand weaves has shown that this sector is constantly on the defensive. It can only proceed by causing the recognition in economy that this sector (cultivation and its ‘arts and local manufactures’ included) does not produce only food, it also produces feed for animals, fuel (both traditional fuels and biofuels) and fibres and grasses and woods, the minerals and clays, the colours, for artisanal (and industrial) production, and that the maintenance of the bio-economy – that is the service of balancing our ecological habitats upon whose gifts we base our lives, a balancing brought about by the application of uncountable streams of local knowledge – is fundamental to the well being of the country’s peoples.

“One would assume that natural materials, organic cultivation, reduction of plastics and other synthetic materials, and recycling would figure in the Centre’s approach to policies across the board,” Jaya Jaitly has observed. As president of Dastkari Haat Samiti, the conceiver of Dilli Haat and the initiator of several of India’s most innovative programmes to return dignity and viability to craftspeople and artisans, her expectation of policy coherence is well warranted.

Both dignity and viability are important, and for as long as handicrafts and hand weaves were held in high esteem by the ruling administrations of ancient and medieval, colonial and independent India, both were assured. In the 1951 Census, the first of independent India, among the list of industries and occupations according to which the working population was described were herdsmen and shepherds, beekeepers, silkworm rearers, cultivators of lac, charcoal burners, collectors of cow dung, gatherers of sea weeds and water products, gur manufacture, toddy drawers, tailors and darners, potters and makers of earthenware, glass bangles and beads, basket makers.

The liberalisation and ‘market reform’ which swept through the country from the early 1990s brought with them a view of both macro- and local economics that became more distant from ‘arts and local manufactures’. India began to pay more attention to GDP and less to the meanings which handicraft and hand weaves represented. By the middle of the decade of the 2000s, biodiversity, carbon, ecosystem services, and even cultural services had begun to be discussed and considered. Terms and ideas such as ‘externality’ and ‘social costs’ began to be used to describe the changes to society and environment that were under way, visible but never acknowledged, which weakened and sickened both.

Such discussion rarely recalled quiet efforts that had been made in the same direction only a little earlier, such as in the report of the Steering Committee on Handlooms and Handicrafts for the Twelfth Plan, which had observed that “these two sectors constitute the only industry in the country that provide low cost, green livelihood opportunities to millions of families, supplementing incomes in seasons of agrarian distress, checking migration and preserving traditional economic relationships”.

‘Green livelihood’ made a quiet entry into planning vocabulary then. Now, ‘livelihood’ has been replaced with ‘economy’, which is quite a different idea, and the recent loud calls in favour of a ‘green economy’ for India have helped shelter a variety of very ungreen enterprises and practices. Perhaps in the notifications of 14 and 15 September we are seeing the first admission from the central government’s financial and planning authorities, that there is no need for a new ‘green economy’ (especially one based on expensive finance and fickle technologies) when we have had one for all the ages that we can enumerate.

The notifications are a worthy start, and I submit to the Ministry of Finance that these can and should lead it to consider anew how incentives and encouragements in the form of taxation instruments can do much to renew, revive and strengthen a ‘green economy’ that is the only genuinely grassroots activity India has and can have.

Some aspects that still require consultation and an extra-financial view are that crafts and weaves are not commodities and should not therefore be fitted by force into the Acts’ labyrinthine system of HSN codes, that the imposition of taxes higher than 5% on handicrafts and hand weaves discourages both sustainable production and consumption (at a time when such practices are gaining international currency), and that a well-informed system of taxation must include an understanding of the continuum of natural material, habitat, and the knowledge streams that use and transform nature’s materials into craft and fabric.

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A food policy pedlar’s annual derby

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IFPRI_GFPR_2012Evidence, investment, research, commitments and growth. You will find these reprised in the second Global Food Policy Report by the International Food Policy Research Institute (IFPRI, which, as I must never tire of mentioning, is the propaganda department of the CGIAR, the Consultative Group on International Agricultural Research, which, ditto, is the very elaborate scientific cover for control over the cultivation and food choices made especially by the populations of the South). And now, with the dramatis personae properly introduced, let me quickly review the plot.

The GFPR (to give this slick production an aptly ugly acronym) for 2012 follows the first such report and furthers its  claim to provide “an in-depth look at major food policy developments and events”. It comes equipped with tables, charts, cases, apparently authoritative commentary (many from outside IFPRI), and is attended by the usual complement of models and scenarios (can’t peruse a report nowadays without being assaulted by these).

In an early chapter, the GFPR 2012 has said:
“Evidence points to a number of steps that would advance food and nutrition security. Investments designed to raise agricultural productivity — especially investments in research and innovation — would address one important factor in food security.”
“Research is also needed to investigate the emerging nexus among agriculture, nutrition, and health on the one hand, and food, water, and energy on the other.”
“In addition, by optimizing the use of resources, innovation can contribute to the push for a sustainable ‘green economy’. Boosting agricultural growth and turning farming into a modern and forward-looking occupation can help give a future to large young rural populations in developing countries.”

The G20 in session

The G20 in session

Consider them one by one. Whose evidence? That of the IFPRI, the CGIAR and its many like-minded partners the world over (they tend to have the same group of funding donors, this institutional ecosystem). A round-up of food policy by any outfit would have ordinarily included at least some evidence from the thousands of studies and surveys, large and small, humble and local, that discuss policy pertaining to food and cultivation. But, you see, that is not the CGIAR method. What we have then is the IFPRI view which, shorn of its crop science fig leaf, is similar to that of the Asian Development Bank’s view, the World Bank’s view, the International Finance Corporation’s view or the European Bank for Reconstruction and Development’s view (raise your fist in solidarity with the working class of Cyprus for a moment). And that is why the GFPR 2012 ties ‘investment’ to ‘evidence’, and hence ‘research’ to ‘food security’.

What research? Well, into “the emerging nexus among agriculture, nutrition, and health” naturally. This extends the CGIAR campaign that binds together cultivation choices for food staples, the bio-technology mittelstand which is working hard to convince governments about the magic bullet of biofortification (especially where cash transfers and food coupon schemes are already running), and the global pharmaceutical industry. It is really quite the nexus. As to food, water and energy, that is hardly an original CGIAR discovery is it, the balance having being well known since cultivation began (such as in the fertile crescent of the Tigris and Euphrates, about seven millennia ago, now trampled into sterility by ten years of an invasion, or as was well recognised by the peons of central America, an equal span of time ago, and whose small fields are being reconquered by the GM cowboy duo of Bill Gates and Carlos Slim).

What kind of ‘green economy’? Among the many shortcomings of IFPRI (in common with the other CGIAR components) is its studied refusal to incorporate evidence from a great mass of fieldwork that supports a different view. ‘Growth’, ‘modern’ and ‘forward looking’ are the tropes more suited to a public relations handout than an annual review of policy concerning agriculture and therefore also concerning the livelihoods and cultural choices made by millions of households. IFPRI’s slapdash use of ‘green economy’ reflects also its use by those in the circuit of the G20 and by the Davos mafia – they are the hegemons of politics and industry who force through decisions (they use sham consensus and gunpoint agreement) that have scant regard for climate change, biodiversity loss or dwindling resources. Hence the IFPRI language of “optimizing the use of resources”. The idea of unfettered growth as the way to end poverty and escape economic and financial crisis remains largely undisputed within the CGIAR and its sponsors and currently reflects the concept as found in ‘green economy’.

Food (trade and commodity) security.

Food (trade and commodity) security.

[The GFPR 2012 report and associated materials can be found here. There is an overview provided here. There are press releases: in Englishen Français and in Chinese.]

“Building poor people’s resilience to shocks and stressors would help ensure food security in a changing world”, the IFPRI GFPR 2012 has helpfully offered, and added, “In any case, poor and hungry people must be at the center of the post-2015 development agenda”. Ah yes, of course they must be, in word and never mind deed. “International dialogues, such as the World Economic Forum, the G8, and the G20, must be used as platforms to develop this concept, propose policy options, and formulate concrete commitments and actions to reduce poor people’s vulnerability to food and nutrition insecurity and enhance their capacity for long-term growth”.

To call the World Economic Forum, the G20 and the G8 ‘platforms’ and ‘dialogues’ is laughable, for there are no Southern farmers’ associations present, nor independent trade unions, nor members of civil society and community-based organisations that actually pursue, rupee by scarce rupee, the agro-ecological restoration of rural habitats in the face of migration, rural to urban, that occurs through dispossession, nor are there any of the myriad representatives of socialist and humanist groups whose small work has a restorative power greater than that of the CGIAR and its sponsors.

Never part of the CGIAR-IFPRI sonata that is played at these ‘dialogues’, there is ample evidence (since that is the theme) of locally articulated and politically wrested food sovereignty that can be held up as examples with which to reduce poor people’s vulnerability. In the past ten years, countries particularly in South America (we salute you, Hugo Chavez) have incorporated food sovereignty into their constitutions and national legislations.

In 1999 Venezuela approved by referendum the Bolivarian Constitution of Venezuela whose Articles 305, 306 and 307 concern the food sovereignty framework. In 2001 Venezuela’s Law of the Land concerns agrarian reform. In 2004 Senegal’s National Assembly included food sovereignty principles into law. In 2006 Mali’s National Assembly approved the Law on Agricultural Orientation which is the basis for implementation of food sovereignty in Mali. In 2007 Nepal approved the interim constitution which recognised food sovereignty as a right of the Nepalese people. In 2008 Venezuela enacted legislation to further support food sovereignty: the Law of Food Security and Food Sovereignty; the Law for Integrated Agricultural Health; the Law for the Development of the Popular Economy; the Law for the Promotion and Development of Small and Medium Industry and Units of Social Production. In 2008 Ecuador approved a new constitution recognising food sovereignty. In 2009 Bolivia’s constitution recognised the rights of indigenous peoples as well as rights to food sovereignty. In 2009 Ecuador’s Food Sovereignty Regime approved the Organic Law on Food Sovereignty. In 2009 Nicaragua’s National Assembly adopted Law 693 on Food and Nutrition Security and Sovereignty.

This is what true resilience looks and sounds like. For those unfortunate populations that continue to struggle under a food price inflation whose steady rise is aided and abetted by the CGIAR and its sponsors, the alternatives become clearer with every half percent rise in the price of a staple cereal, and with the loss of yet another agro-ecological farming niche to the world’s land grabbers.

The carefully constructed mirage of the ‘green economy’

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Not a week goes by nowadays without one high-profile institution or high-powered interest group directing us all to be part of the ‘new, green economy’. That’s where the next jobs are, where innovation is, where the next wave of financing is headed, where the best social entrepreneurship lies. There are the big inter-governmental organisations telling us this: United Nations Environment Program, UNCTAD, OECD, International Energy Agency, the big international lending agencies like the World Bank and Asian Development Bank. There are big think-tanks telling us the same thing – backed up by hefty new reports that are boring to read but whose plethora of whiz-bang charts are colourful. There are big companies, multinationals and those amongst the Fortune 500, also evangelising the new green economy and patting themselves on the back for being clean and green and so very responsible.

Artisanal blacksmith and his family, Maharashtra, India

What on earth are they all talking about? Does it have to do with us average, salaried, harassed, commuting, tax-paying types who are struggling with food inflation and fuel cost hikes and mortgages and loans that break our backs? Are they talking to our governments and our municipalities, who are worried about their budgets and their projects and their jobs too?

Here are a few answers from working class Asia. Let’s start with restating a couple of trendlines. One, the era of growth in the West is over. Growth is Asia is what is keeping the MNCs and their investors and bankers and consultants interested, and this means China and India (also Brazil, Russia, South Africa, Indonesia). Two, the environmental consciousness which began in the 1970s to spread quickly in the West led to many good laws being framed and passed. These were responses to the industrial and services growth in the Western economies. As globalisation took hold, people in less industrialised countries – ordinary citizens – saw what had happened in the West and learnt from their experiences with industrialisation. Green movements took root all over Asia and South America, protests were common, confrontations just as much, and global capital found itself being questioned again, even more fiercely.

These are the two major trends. The forces of production want to move much further into what used to be the ‘developing’ world, but want to meet much less resistance. That’s why they appeal to the consumer minds of China, India and the other target countries – you need jobs, homes, nice cars, big TVs, cool vacations, credit, aspirations, and lifestyle is what the messages say, whether they’re from telecom companies or condominium salesmen. But it’s hard to market all this stuff – real stuff, virtual stuff – to people who are still struggling to make ends meet.

This was after all the old 'green economy'. A late 19th century painting in a maritime museum near Mumbai, India

That’s where the ‘new, green economy’ tagline and its earnest-sounding philosophy comes in. “The main challenges to jump-starting the shift to a green economy lie in how to further improve these techniques, adapt them to specific local and sectoral needs, scale up the applications so as to bring down significantly their costs, and provide incentives and mechanisms that will facilitate their diffusion and knowledge-sharing,” said one of these recent reports. Look at the text which contains all the right buzzwords – ‘scale up’, ‘jump-start’, ‘applications’ (that’s a favourite), ‘knowledge-sharing’, ‘local’.

This makes the ‘old economy’ sound good but changes nothing substantial on the ground, or on the factory shopfloor or for the tens of thousands of little manufacturing units that do small piecework jobs for the bigger corporations up the chain. The world’s business philosophy has changed drastically even without the impact of environment and energy. To drive home this point, it has been a long time since we heard anything like ‘industrial relations’, and that alone should tell us how far the dominance of capital has reached, when labour, whose organisation gave the West its stellar growth rates in the 1960s and 1970s, has now become all but ignored. This is because the dominant interests associated with capital have insisted, successfully for investors and for pliant governments, that the manufacturing firms break loose from the industrial relations moorings they had established. The restructuring of firms to emphasise leaner and meaner forms of competition – as the ruthless management gurus and greedy consulting agencies instructed – was in line with market pressures that are viewed by the powers-that-be as crucial to the revitalisation of the economy.

Read their greenwash carefully and the control levers are revealed. “Further innovation and scaling up are also needed to drive down unit costs. Technologies will need to be ‘transferred’ and made accessible, since most innovation takes place in the developed countries and private corporations in those countries are the main owners of the intellectual property rights covering most green technologies.” So says ‘World Economic and Social Survey 2011: The Great Green Technological Transformation’ (UNESCO, Department of Economic and Social Affairs). Rights and access are built in from the start, as you can see.

And yet it is this very system of production, of the arrangement of capital and of the effort to weaken working regulations that is now talking about the ‘green economy’. Why do they even imagine we should believe them? They are the ones who have remained locked into the fossil fuel economy and who have partnered the enormous influence of the finance markets, who have followed every micro-second of the way the dictates of capital flows and what the market investors want in their endless quest for greater profits in ever-shorter cycles of production. For the major business of the world, ‘green economy’ is yet another route to super-profits and the consolidation of both forces of production and masses of consumers. The difference between now and the 1970s is that today they are able to successfully enlist the apparently authoritative inter-governmental organisations with their armies of economists and social scientists and engineers, to support this new profiteering. Only now, the cost is planetary.