Viswanathan K's Thoughts

Delhi suffers from smog every winter. The biggest cause for that, of course, is pollution. A lesser cause, but not a trivial one, is because of the crop residue being burnt in neighbouring Punjab. And therein lies a tale , one narrated very well by Pranay Kotasthane.   The problem isn’t that the crop residue is being burnt; rather, it is that it is burnt simultaneously across many farms in a very short time period (the first week of November). Ok, so why’s that the case? And can the problem be reduced by spread over a larger time period?   In theory, sure. In practice, no. Why not? Because the kharif crop (paddy) is sowed after June 15: “This leads to a delayed output leaving farmers with very little time to clear the field for the next crop. ” But that just raises a new question – why is the crop sowed late? And would sowing it sooner help with Delhi’s smog problem?   No. Because the Punjab government’s act of 2009 prohibits paddy transplantation before ...

Often, answering a silly question can lead to better understanding. Randall Munroe proved that in the context of physics via his two “What If” books. Tim Harford tries the same with “silly” economics questions .   There’s a lot of talk on mining asteroids for ores. That’s the first question Harford takes on. How big would an asteroid need to be to make it worth a space mission to mine it? There are 3 aspects to consider, he says. First, engineering. Either you setup a refinery in space (very expensive, maintenance overheads) or you bring the raw ore back to earth (very messy. And expensive). Second, economics. Increase the supply of something and prices could drop. Which makes any cost-benefit analysis tricky and error-prone. Third, physics. It is very expensive to carry anything into space – the extracting equipment, tools etc.   All of that also means that it is better to set up some system in space to launch, receive and refine things (in space). Some place cheaper ...

Decades back, when travelling abroad, I remember my passport had an ECNR label on it. It stood for Emigration Clearance Not Required. I never bothered to find out about it back then, and only recently stumbled upon an article that explained what it was all about.   In India, people who haven’t completed schooling until 10 th standard were issued an ECR (Emigration Clearance Required) passport. When men with such passports want to travel abroad (18 countries on that list) for employment, they needed to get an “Emigration Clearance” from the Protector of Emigrants department. For women holding such ECR passports, it was worse – if under the age of 30, they could not go for work to those countries at all.   This sounds outrageous and discriminatory, so why was such a policy even created? Pranay Kotasthane says the reason was actually a good one: “This system was adopted to prevent the exploitation of uneducated and, hence, vulnerable Indians. The logic was that this a...

I read of this Italian town called Monfalcone that banned (surprise, surprise) cricket! Why? And who even plays cricket in Italy? Therein lies a tale. In the 1990’s, the town had a need for labourers to build ships. The locals (and most Europeans) weren’t interested, and so the role went to Bangladeshis, most of whom were Muslims. Thus, a third of the town are foreigners. “In Monfalcone, Italians in Western clothes mingle with Bangladeshis wearing shalwar kameez and hijabs. There are Bangladeshi restaurants and halal shops .”   The culture difference, the Islamic angle, the rise of the right wing in Italy… cricket was the last straw in this town. Outsiders, not integrated, and now insisting on playing their “national sport” – it was just too much for this town. ~~   It reminded me of Shruti Rajagopalan’s post on an unrelated topic – the young population of India and its global ramifications. “Globally, one in five people below 25 is from India. 47% of Indians,...

As China got richer, the wanderlust hit the Chinese citizen. But they faced two major challenges when it came to travelling abroad, says Kevin Shimota in The First Superapp . The first one is the language problem – most Chinese don’t know English. The second one, surprisingly, is navigation. What? Don’t smartphones have maps? More on that in a bit.   The language problem hurt a lot. Prospective travellers would end up relying on posts and blogs by fellow Chinese (in Chinese, of course), and would often miss other worthwhile spots, even if they were close by. In most tourist spots, information was almost never in Chinese, so no help there either.   Now to the surprising problem – navigation. How’s that even possible when everyone has a smartphone? Because for the Chinese, everything Google is banned. That includes Google Maps. Even when they go abroad, if they are using a Chinese SIM , Google Maps won’t work. Alternatives like Bing Maps and Apple Maps aren’t too good. A...

This blog goes into the details of implementing GST. One of the major problems is the “inverted duty structure”. Pranay Kotasthane explains the problem well with an example: “Inadvertently, this resulted in some raw materials being taxed at a much higher rate than the final product. For example, the tax on rubber used in hawai chappals is a mighty 18 per cent... On the chappals itself, the tax rate is just 5 per cent presumably because we have to save this laghu udyog. This situation is what’s called an inverted duty structure.”   Why is this a problem? Kotasthane expands: “Assume the hawai chappals are sold at ₹120 to customers. The output tax payable would be ₹6/chappal (5 per cent of 120). However, since the GST is a value-added tax, the chappal maker can net out the taxes she has paid for the inputs. Assuming that she purchased rubber of ₹50, she has already paid a tax amount worth ₹9 to her supplier (18 per cent of 50). The net tax to be paid by her is ...

GST. Goods and Service Tax. It replaced all indirect taxes imposed by state and center in 2017. Simply put, GST is a form of value-added tax (VAT). What does that mean? An example helps. Take a company that buys steel to make and sell pressure cookers. The idea of VAT is that each layer (mining, steel maker, pressure cooker maker) pays tax only on the value addition it did (mining, making steel, making pressure cooker), not for the entire chain of activities preceding it. This makes sense by considering the alternative to VAT – (1) if each layer pays tax for the entire chain, well, we’re collecting tax multiple times for the same lower-level activities, (2) which raises the cost and thus sale price of the product, (3) in turn, making Indian goods expensive and thus uncompetitive in the global market.   Other advantages flow from a single tax system. If simplified enough, it makes compliance and comprehension easier. A corollary of that is greater transparency. Since taxes ...