May 30, 2018 @ 2:00 am

30 MAY 2018

Transition tests

Pakistan in election mode

The appointment of a caretaker PM in Pakistan signals it’s in election mode

The appointment of a caretaker Prime Minister in Pakistan, under whom the country will face general elections on July 25, sets the stage for the second consecutive transfer of power from one civilian government to another. This in itself is alandmark for democracy in Pakistan, where no civilian Prime Minister has completed a full term in office; only in 2013 did a government complete its full tenure for the first time. The choice of Nasirul Mulk, a former Chief Justice, as caretaker Prime Minister has been welcomed across the spectrum, with leaders of the main political parties, including the Pakistan Peoples Party, the Pakistan Tehreek-e-Insaf and the Jamaat-e-Islami, issuing statements commending outgoing Pakistan Muslim League (N) Prime Minister Shahid Khaqan Abbasi’s decision. During his time in the Supreme Court, Justice Mulk heard several contentious constitutional matters, including one in which a sitting Prime Minister, Yousaf Raza Gilani, was summoned on contempt charges in 2012. He was also on the seven-judge bench that issued a restraining order against the then all-powerful President, Pervez Musharraf, in 2007. In 2013-14 he served as the acting Chief Election Commissioner, which will hold him in good stead in his task of taking Pakistan through free and fair polls, and conducting necessary government business in the interim in an impartial manner.

However, Justice Mulk and his caretaker Cabinet will have crises to deal with over the next two months. To begin with,Pakistan is set to be placed on the grey list by the international terror financing watchdog, the Financial Action Task Force, at its plenary session in June. The second issue is internal, but stems from the same problem: Pakistan faces the danger of terrorists and extremists being ‘mainstreamed’ into the electoral arena and marginalising the political centre, which is already missing former Prime Minister Nawaz Sharif after his disqualification from public office by the Supreme Court. Hafiz Saeed’s Milli Muslim League has already gone to court to demand recognition. Security during the campaign will also be a challenge. Earlier this month, an attack on the PML(N) office in Karachi and an assassination attempt on Interior Minister Ahsan Iqbal underlined just how serious the threat is to politicians. As caretaker Prime Minister, Justice Mulk will be also required to steady the economy. A balance of payments crisis, for which the outgoing government has reportedly asked Beijing for a loan of $1 billion to $2 billion, will add to Pakistan’s burgeoning debt on account of the China-Pakistan Economic Corridor. The caretaker regime has its task cut out, and it will need internal support and that of its neighbours and the world community. The successful completion of the exercise will be a positive signal for all of South Asia as well, with Bhutan, the Maldives, Bangladesh, India and Afghanistan (in that order) all due for elections over the next year.

Green push?

Policy on biofuels

The new biofuels policy is high on ambition, but success will depend on the details

At a time when rising oil prices are putting increasing pressure on the economy, even small steps to encourage the use of biofuels are welcome. The Cabinet this month approved a National Policy on Biofuels, which encourages the generation and use of biofuels such as ethanol. It primarily tries to address supply-side issues that have discouraged the production of biofuels within the country. For one, it allows for a wider variety of raw materials to be used as inputs to produce ethanol that is blended with petrol. Until now, only ethanol produced from sugarcane was approved for this purpose. Under the new policy, feedstock for biofuels includes sugar beet, corn, damaged foodgrain, potatoes, even municipal solid waste. This will likely reduce the cost of producing biofuels and improve affordability for consumers, particularly during times when oil prices reach discomforting levels. In India, industrial-scale availability of ethanol so far has been only from sugar factories, which were free to divert it to other users such as alcohol producers, who would pay more. The oil companies have been floating tenders for ethanol supply, but availability lags behind their needs, because the price is often not attractive enough for the sugar industry. The Centre hopes the new policy will also benefit farmers, who will be able to sell various types of agricultural waste to industry at remunerative prices. But given the technology available, a large chunk of the biofuel will have to come from the sugar sector for now. Therefore, pricing is the key. The government estimates that ethanol supply of around 150 crore litres in 2017-18 could save foreign exchange worth over Rs. 4,000 crore. The production of biofuels from agricultural waste, it is hoped, will also help curb atmospheric pollution by giving farmers an incentive not to burn it, as is happening in large parts of northern India.

But policy should not get ahead of technological and financial feasibility — and options should be realistically laid out for farmers. There is also a need for caution in using surplus foodgrain to produce ethanol. And while removing the shackles on raw material supply can have definite benefits, it cannot make a significant difference to biofuel production as long as the supply-chain infrastructure that is required to deliver biofuels to the final consumer remains inadequate. To address this issue, the new policy envisages investment to the tune of Rs. 5,000 crore in building bio-refineries and offering other incentives over the next few years. The government should also take steps to remove policy barriers that have discouraged private investment in building supply chains. Until that happens, India’s huge biofuel potential will continue to remain largely untapped.

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