Climate change

The year of scanty monsoon to incessant out-of-season rains and thrifty giveaways giving way to generous public payout

By Mohan Sule

It took many years of persuasion, prevarication and procrastination for the world to realize the dangers climate change posed for the survival of the human race. But, for India, 2015 was a year of sudden transformation, of paradoxes and contrasts. It took just days for the crescendo of infallibility and invincibility to crash into a pit of despair and dejection. If the high point was the feeling of smugness to see the world’s most powerful man braving smog and a drizzle to catch the Republic Day parade in the capital, the low point was the bounce-back into the political arena of a crusader from bureaucracy, one of the three strands choking the common man in their tentacles of quid pro quo. Not surprisingly, the market, too, took no time to come back to reality after reaching the zenith as the euphoria of India finally cutting the umbilical cord of giveaways to farmers and friendly capitalists got punctured by the second consecutive deficient southwest monsoon. Ironically, it poured and how in some coastal belts even as many parched states continued their tryst with famine and farmers’ suicides. The trepidation in waiting for the most powerful woman on earth to act outdid the plot line of a Hitchcock movie in its twisted suspense even as foreign equity and debt investors suffered a spell of vertigo. Nonetheless, foreign direct investment made a beeline on spotting of opportunities in insurance and defense and Make in India even as China collapsed under the weight of excess capacities and unbridled speculation in the primary market. If there was unanimity on the cause — excessive leverage — of the euro region’s recession, there was no such agreement on why India’s growth engine had lost steam. The reasons ranged from those with substance (the slow pace of reforms) to bogus (failure to build consensus with a recalcitrant opposition focused single-mindedly on stalling legislation to trip the economy).

The confusion was evident elsewhere, too. The ghost of Hamlet haunted the Fed as it wrestled with the dilemma to raise rates or not to without upending the emerging markets and so also our own central banker: tame food inflation or boost industrial output. Banks, though, shrugged off the benevolence, obsessed as they were in cleaning up their balance sheets, marked with years of generosity to customers with closeness to the movers and shakers as collateral. Squeezing margins, falling demand and spiralling food prices were not the ingredients to boost the spirits, despite plunging commodity prices proving to be a silver lining. The promise of operational autonomy in lending was as enchanting as a rainbow. In fact, the hard times exposed the unpalatable underbelly. In spite of rapid urbanization, villages held the key to savings and consumption. No wonder, financial inclusion became a buzzword, with attractive acronyms coined to capture the essence. Transfer of subsidy benefit and deduction of pension and accident cover premium were believed to be the recipe to bite into the banking habit. A welcome sign was the thrift on display, ranging from selling natural resources through bidding to reluctance in waiving loans and ramping up a minimal the minimum support price for crops. Yet, there was splash of indulgence. The hefty increments recommended by pay commissions transformed government and PSUs as sought-after employers as evident from the clamor to expand reservation quotas.

The Bihar polls demonstrated that getting the mathematics of caste and community equation right mattered more than the combustible composition of a corruption-free society. If the results underlined the limits of brand power and the downside of brand dilution, they also reinforced the adage of what it means to win the battle but to lose the war. It was triumph of parochialism (Bihari v Bahari), viewed as a legitimate concern when practiced by one set of players but not by others (presidential campaign in the US). Hypocrisy was perhaps the most enduring takeout of the year. For the sullen opposition, the idea of pulling India by the bootstraps came to imply sabka saath, ek family ka vikas. The indefatigable salesman, logging flier miles to make friends for India, was ridiculed for being an NRI and enthralling a constituency that was not going to vote. A 56-day sabbatical to mysterious lands, however, was considered necessary for reinvention and rejuvenation. Unwittingly, the argument exposed the chinks in the intolerant debate. The existential fear stemmed from the attack on holy cows of cronyism and appeasement of entrenched interests and the emergence of voices that were hitherto suppressed. There was shock and awe that many might actually like and share a new growth trajectory based on market intervention rather than the state-knows-best trickle-down economics. The climate in India surely underwent a change in 2015.