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Redemption of External Debt Outstanding of the Government of India 1.   The Government of India, Parliament, and the Reserve Bank of India need to work together to recognise the difference between the external debt converted to the Indian rupees at book value and the current rates. 2.   Table 1 reveals the external debt outstanding as on September 2021 taken from RBI bulletin. TABLE 1 * Source: Values extracted from Reserve Bank of India bulletin * Converted USD: INR @ 75. 3542 at 1:30 pm on 11/02/2022. Source: Financial Benchmarks India Pvt Ltd 3.  The Indian government owes Multilateral, Bilateral and IMF organizations a debt to the extent of USD 125.6 billion, that is, Rs 9,46,448 crores, which requires to be repaid on due dates. These are loans at concessional rates or otherwise. The Government of India needs to create an International Debt Redemption Fund 4.   The Government needs to be free of debt to any Multilateral and Bilateral institutions or the IMF. 5.   Parliament needs to decide that the Government of India needs to create an International Debt Redemption Fund. It can decide to allocate a nominal amount of Rs. 2500 Crores for this financial year 2022-23. 6.   One of the sources for the international debt redemption fund that can be decided by Government and Parliament is the annual surpluses from the Reserve Bank of India, entirely or a portion. 6.1. It is also clearly required to be stated that the profits of the Reserve Bank of India as determined annually is a surplus allocated to the Government of India. 6.2. For the next 10 years, it needs to be solely used for economic purposes as it is solely an earning from economic activity. 6.3. The Reserve Bank of India is in a position to share this and the Government can utilize it better. 7.   The liabilities of the Government of India clearly state as follows: TABLE 2 *Balance according to book value Source: Value extracted from statement of liability of Central Government from union budget India. 8.   The unnoticed contingent liability of Government of India. 8.1.  The Government of India does not “hedge its foreign currency borrowings in foreign currency”. 8.2.    As on the date say, 31st December 2021, the Government has “contingent liability of Rs. 4,77,413.48”. This is arrived explicitly in the Table 3 below. TABLE 3 9.  Parliament needs to examine the Pros & Cons of prematurely retiring sovereign foreign currency debt of India. Questions:    To what extent will the Reserve Bank of India and the Government of India with Parliament work together on the redemption of the Government’s Foreign Borrowings?     Is an early retirement or prepayment of the Government’s Bilateral, Multilateral and IMF loans appropriate for India, given the Foreign Exchange Reserves at Record levels?    Can the Government of India and the RBI enable current surpluses in the Global economy to create assets in India through the Financial System without risk?    If any nation in the world is condescending on India, the need for introspection is, do we need any loans or grants from any nation?    Is halting future sovereign loans a good policy? Henceforth, this needs to be a decision in principle. Remedies 10.    Parliament should address the contingent liability of the foreign exchange fluctuation risk. 10.1.  It should be expressly stated to the Parliament in budget papers or in the Committee, and the Reserve bank of India should confirm it in its monthly statement. 10.2.  The Reserve Bank of India and the Government of India should work together in narrowing these contingencies by introducing special measures. 11.     When the pre-payment is decided: 11.1.  It can be done by a Debt Swap equivalent in Rupees by issue of 364 days Treasury Bills. 11.2.  On exercise of this Swap, the Government can deposit it in foreign currency with State owned banks in India till it arranges to repatriate the money in consultation with lenders. 11.3.  All the lenders must agree to take back the loans before the due dates. 11.4.  The repayment of dues to the International Monetary Fund should be the first one initiated by the Central Government. 11.4.1.  The Reserve Bank of India is a contributory to the International Monetary Fund in its International Investments Program. 11.4.2.  The Government of India can easily repay this loan and need not rely on any borrowings of IMF under a managed Foreign Exchange Reserves Program by the Reserve Bank of India, which has been carried out in an accomplished manner. 11.4.3.  Indian citizens in India or internationally also need to be allowed to participate in international holdings in the form of capital account convertibility gradually developed in the next 10 years. 11.4.4.  This would be a great moment for India if the Parliament and Government with Reserve Bank of India decides that IMF borrowings to the extent of Rs 1,75,575 crores be repaid with immediate effect. 11.4.5.  This can be done with swap of Treasury Bills raised from the market and supported by the Reserve Bank of India in a short period. 11.5.   In the case of bilateral loans, these would have been taken for a long period of 20 or 30 years with durations of 20 or 30 or 40 years. It is time that these loans be repaid or provisions made for repayment in the ensuing months. 11.5.1.  Since bilateral arrangements have to be addressed diplomatically and arrangements need to be made by communications, Parliament can resolve that the bilateral loans can be prepaid. 11.5.2.  It would also be a grand moment if Parliament decides with Reserve Bank of India and Government that we are at a confident level that we do not request, ask or take any loan from a sovereign government for the purposes intended. 11.6.   In the case of multilateral loans, India need not resort to any loan from IBRD, ADB or World Bank or any other bank. It can rely on its own rupee sources and its savings. In order to achieve all of this, a conscious creation of an External Debt Redemption Fund will induce and motivate public finance actions as well as recognition of this debt by the public of India to bring in a spirit of sovereignty. 12.   The Government of India in forthcoming sessions of Parliament budget can create two funds –   Redemption of External Debt Fund   Defence Assets Acquisition in Foreign Currency Fund 13. Credits to these funds can be channeled through appropriate Budgetary mechanisms of the Central Government. One of the options is that Reserve Bank of India’s annual surplus can be a source of credit. 14.     The Government of India should halt all sovereign borrowings in foreign currency. India should become investors in Multilateral institutions. 15.   An internal debate in the Ministry of Finance needs to be initiated and if necessary, in the public domain, inviting public views. 16.   The Government of India can decide on merits and convey the decision in principle to Parliament and the Institutions and subject itself to scrutiny in the realm of public finance. 17.     The parliament Panel can convey to Government of India at the views of public. CONCLUSION •   The Reserve Bank of India and the Government should agree to swaps that enable RBI to hold securities equal to the rupee equivalent of Government Debts and the RBI can provide the needful forex to prepay loans. •  It is therefore wise to halt all sovereign borrowings in foreign currency – multilateral or bilateral. On the other hand, the current situation in India can contribute to global development of all nations as it is meant to be. • This will increase returns of capital in India and generate employment.

Creation of Strategic Petroleum Product Reserve – 20 percent Ethanol Blended India has a Strategic Reserve for Crude Oil. There is a need for having a Strategic Petroleum Product Reserve at Points and Proximity of Consumption in the Indian Union. An aggressive stance on blending ethanol with petroleum products can give rise to the new series of tactical investment, physical and working capital. Citizen’s participation will also be called for as it is in the interest of the consumer and the economy that vital fuels are always accessible. This demands a policy that these reserves are part of the locales, so that at any given time, the Products Reserve is sufficient to meet the requirements for 30 days and beyond. The possible locations can be: a)     Strategic Locations at Junctions of Indian Railways and NHAI b)     Rural Stations at a distance of 25 kms to 50 kms from cities and towns  c)     Proximity to producers – within 25 kms to 50 kms d)     Suitable for Blending, Stock and Flow with Ethanol 20 percent. e)   Blending with refined products needs to be separated from refineries with tanks, approved blending technology and ready delivery for routine sales as well as defined national or international calamities. f)      The total ” floating ” stock of blended products can be mandated to be available to all Marketing Companies.  g)  Marketing companies need to be offered pooled facilities at nominal national cost, where all Departments – Central and State Government Activities converge. h)     National Interest defined and mandatory connectivity to National Users  ·     Normal Conditions ·     Disruptions in commercial activities –  § notified and sudden refinery or logistics related mishaps § localised calamities  § national calamity related stoppages and shutdowns as determined by Authority Nodal National Agency For Example: o       Projects and Equipments Corporation Limited – Can be the National Agency and can be an Equity Partner with all other agencies as a Catalyst up to 26 percent of Equity. o       All Petroleum Marketing Companies with written agreements on supply and demand matching at respective locations. NHAI –        Needs to float a Subsidiary with commercial viability offering Right of Way and annexed facilities for tanks and pipelines and extended support to Highway Transport. Indian Railways # Needs to nominate an existing subsidiary like RITES or IRCTC or both that can use railway infrastructure in rural areas. # These facilities with strategic and tactical inputs also meet # Defence  # State Government nominated uses. International agencies and Government subsidiaries with interest in Petroleum sector can be invited based on their interest in the Indian markets if, –        they have expressed interest, as India is a dominant importer, –         they also have sovereign funds.    –       Example – Norway, Abu Dhabi, who can provide, Capital International Specialisation Innovation Systems Stakeholders Protecting their interests Safety of Capital Return on Investment Strategic interest Commercial Interests in finding neutral markets  Green Funds Agriculture and Employment Generating Agencies can be participating Example: Milk Unions Poultry organisations State Road Corporations Private Transporters who will value lower costs Indian Railways  PROMOTE –        Own Your Wagons –        Rakes For specific delivery points to long distance consumers.  For example, Kerala, North East, heavy consumption zones outside Major Cities.  METRICS –        One Month Equivalent to Stocks required in each District –        Two Months Equivalent for Defence and National Interests Stock and flow Principle This implies that the petroleum products stores remain fresh and regular commercial sales will be done from the same tank farm. The Base Stock – Diesel and Petrol Pooled Stock Working Notes  1.     There is a need to focus on the supply of products in proximity. 2.     In a market economy, producers will strive to reduce costs and maximise profits. They will not be “greedy” but work in “self-interest”. 3.     National interest has to be paid for by the Central Government and State Government.  4.     In the scenario described, both capital assets and running costs will be paid for by better efficiencies. 5.     Digital management to reduce costs. 6.     Public participation in Equity and Bonds where and when feasible for higher returns. 7.     50 percent utilisation concurrently for flow purposes will pay for the cost of the Product Reserves. 8.     There need not be heavy investment by the Central Government – participation can be restricted to 26 percent. 9.     State Governments will be benefited by infrastructure creations. 10.   Magisterial function in crisis will be with least disturbance to the public. 11.    Any world calamity can be resolved in 60 days with alternative supply. 12.    Public needs to be educated and participative not to waste petroleum products. 13.   Pollution needs to be penalised. 14.  Railway Rakes can be “floating” stocks and can be turned around at will, parking at midway points in loop lines or rural terminals.  15.  All Defence installations can have 8 point strategic storage surrounding the installation or camps and cantonments. Defence buying should specify compulsorily 20 percent blended under stringent quality specifications, which will in turn help civilian supply quality in surrounding areas. 16. Considering the Experience of SPPR – SPPR can be a minority but strategic equity partner at 26 to 35 percent with at least 35 entities to implement this nationally over next 5 years, with Mangalore as Headquarters due to convenience and congruence. Green Energy Promotion should be a win win win win win for the Indian economy

Cashew (Anacardium occidentale) is a tree nut of growing importance in the global trade of horticulture produce. Of late, many issues have cropped up and problems have surfaced on dealing with the harvesting and post harvesting stages and further treatment in the commercial value chain. The ratio of kernels to raw cashews is 1: 4 or below, depending on various factors that reduce yield. As it is a very expensive product, processing of cashew kernels must result in least possible destruction or damage or depreciation. Technology has not been a driver in cashew processing and the record of failures is higher than successes over a period of time. The conflict has been between the conventional processes and the newer developments. The evolution of cashew processing followed the course of demand. The higher demand for kernels led to the linear expansion of cashew processing, where the availability of labour was abundant. The increase in the economic cost of labour led to the concept of division of labour and evolution of the small version of the cutting machine. The history of mechanization of cashew is since late 1950s. The advent of mechanization began as supply of equipment trade by UK, Japan and Italy. Probably other nations chipped into help the producers and consumers. Mechanization took root in Brazil and evolved, but the industry could not deliver the volumes required for world markets from their own production. Non-availability of labour led to the innovation, which automated a part of the shelling cycle. Peeling was the most laborious part and machines were developed to remove the outer peel to the extent of 70 to 80 percent. Grading by hand evolved to small graders, which automated the process slightly to the optically sorted grades, almost simulating hand grading for sizing purposes. The Brazilian industry got protection from increases in global raw cashew prices, which indirectly gave compensation to some of the destructive aspects of mechanization on the process and the product. A precondition for good preservation of raw cashew is ideal to perfect sun drying to bring the equilibrium in moisture content. A fully well dried raw cashew has slightly below 9 percent moisture content. The biochemical actions turn for the worse if raw cashews are not well dried. This causes irreversible destruction and hence universal education of producer and traders is essential for making them aware of the value lost when raw cashews are not dried well. The pre-requisite is to complete the post-harvest. Drying process and process raw cashew fit for any type of manufacture. In Africa, a combination of state policy and practices, control and regulations and market practices globally contributed to the installation and failure of mechanised practices. It ran the cashew economy to the ground and revived with market practices and resulted in the massive growth globally when market prices generated market driven policy and practices which we see today. The challenge for cashew is that the means of producing kernels and technology for production needs to be defined.The cashew kernel extraction follows the processes of proper post-harvest care, further processing of raw cashews, conditioning of raw cashews and then roasting, shelling, oven treatments, conditioning of heated shelled kernels, peeling, sorting, elimination of testa and non-conforming degraded kernels and final grading as per commercial standards. The Raw Cashew Is A Tough Nut To Crack. The Following Table Reveals The Process: The peculiarity of raw cashews is that it cannot be compared to other nuts or agricultural processes. The evolution of processes to develop the kernels have been ad hoc and handed over as skills and sub processes to suit manufacture and delivery of kernels. Cashew manufacture requires a systemic study of all processes and sub processes and this need to be in situ in factories. It would be a huge challenge to have a central laboratory and development centre for cashew. Study and research of cashew manufacture is to be preceded by intense studies of the raw cashew for physical, chemical, biological, microbiology, biochemistry and water activity characteristics and behavior under different conditions and parameters. Thus, it is clearly a case for partly manual and partly mechanical process for extracting the full or potential value of a raw cashew. The raw cashew nut is the only tree with a hard shell which has a phenolic substance. The acid which the shell can release in process and how the shell can be separated without any contamination has been satisfactorily done with manual or partly manual and mechanical processes. Optical sorters with RBG technology evolved over sensors, which could sort to requirement. In all, the requirement of 60 employees per metric tonne produced got reduced to 10 employees in this year. The industry now comprises of a large number of heterogeneous processes. Cashew has also a kidney shape with an indent. The other characteristic or shape issue is that it has length, width and depth which vary. The thickness of the shells varies not just from nut to nut but within a single nut at the points where the shelling would take place. Any shelling that happens has to be at a particular point with a shape that has half a kidney characteristic with a sharp centre. This leads to issues when the nut slips and various types of damages can occur if this is done devoid of skill and when done mechanically there is no uniformity. Without shelling no further activity happens. This brings to us the sensitivity of parts of raw cashews when exposed to the process. Cashew manufacture involves heat transfer in multiple stages that can be applied, which are critical for extraction from the outer shell and further for the gentle removal of inner testa. Cashew kernels are covered by an inedible outer skin with a predominant component of tannin. The intricate processes for cashew kernels extraction once simple in the manual process has led to a series of complication when there are automated or mechanical processes. In mechanised processes the prerequisites go higher than in the manual process and the output or yields have qualitative, quantitative impacts as well as it alters the characteristics in a significant way that can affect the final product or the way consumer requires it. Packaging is special to cashew due to its delicate nature. Cashew kernels have another characteristic compared to other tree nuts. It is “meaty” and has good doses of fat and carbohydrates. This requires cashew kernels to be preserved well. Cashew requires an “inert” atmosphere which requires it to have specialised packaging. It is therefore desirable that cashew conversion is subject to severe tests after a series of observations. The objective is to magnify the value from each gram of raw cashew. Cashew as a tree produce will defy uniformity. It is a regrettable fact that there is no established or recognised industrial research on cashew manufacture. The nature and volume of the industry now requires it to be a national or international effort, preferably backed by United Nations or an internationally recognised and backed agency. Cashew manufacture and technology anywhere in the world will be standardized and a success only on the following criteria when set into a pre-requisite programme: Complete and thorough post-harvest drying of raw cashews practices by producers and traders or intermediaries e.g. cooperatives and handlers Protocols for storing and transportation of raw material that is raw cashew Complete understanding of biochemistry in process once raw cashews are submitted to process Suppliers and customers of cashew kernels understanding the cashew value chain Participation of the entire value chain as stakeholders in the study, research and development Any process technology will have to completely be the result of in depth study of the material. It is time for a World Conference on Science and Technology on cashew to establish thoroughly, the agenda and priorities for industrial research, to consolidate and explore new frontiers for cashew.

The Reserve Bank of India must act speedily in making special efforts to undo legacy issues. The Government of India has borrowed heavily over the last 15 years. In the process, dealing with inflation at certain periods, the Reserve Bank of India independently took steps to increase the interest rates and established a higher interest rate regime for the whole nation. It certainly made an impact on the markets; it made an impact on borrowing by the public. In fact, a re-examination of its impact must be done internally by the Reserve Bank as well as the Government of India. In the period of four years, India had extremely high real interest rates as well as nominal interest rates compared to the rest of the world. It is therefore an opportunity to correct this. The Government of India has been the worst hit victim and on behalf of people of India, it cannot be burdened by legacy issues even though it cannot manage it. Reserve Bank of India has now within its means and tools, the capability of redressing these wrongs without hurting markets or its autonomy or position. The table below reveals a substantial amount to Outgo of Interest by the Government of India. a) Due to the increase in borrowings b) Increase in rate of Interest Source: budget.gov.in The Government of India needs to reduce the interest outgo from Rs 809,000 crores per year to Rs 350,000 crores for financial year 2022-23 and need not wait for prolonged periods. The table below shows the flexibility of savings on interest payment. Source: Prepared by G Giridhar Prabhu RBI can take the following steps: 1) The total holdings of government securities that it has on its inventory, which is to the extent of Rs. 11,00,000 crores can be converted into Treasury Bills at a nominal interest rate of 0.25%. This can be proscribed as a national measure in an emergent situation. This is equal to the interest rate in the global situation and India’s position within 10 large economies. This can be for a tenor of 364 days and the Government of India will save instantly the total amount of interest pay-out this year and forever. 2) It is recommended that the Reserve Bank of India can buy back the outstanding oil bonds and convert it into normal securities like Treasury Bills at 3.35 percent. This can be done immediately in order to ensure the goal of reducing interest costs of the Government of India. The saving over the period of the Bonds is Rs 17,788 Crores. 3) The Government and Reserve Bank can work together so that Reserve Bank of India buys to the extent of Rs. 33,00,000 crores of securities. These can be converted into – o 182 days Treasury Bills @ 3.35% o 91 days Treasury Bills @ 1.75% o 46 days Treasury Bills @ 1% o 14 days Treasury Bills @ .25% The table on list of Government of India securities outstanding as on 6th September 2021 is enclosed with this document. The list has been modified by making a table and the total outstanding in each of the interest rates is summarised here below. Total Outstanding Securities at different interest rate slabs (Rs. Crore): 4) Reserve Bank of India within its purview can structure as a response to current global Indian factors as follows in the next 4 months as a borrowing structure: • Treasury Bills Reverse Repo Rate less than 14 days Maturity 0.25% • Treasury Bills Reverse Repo Rate less than 46 days 0.50% • Less than 182 days 0.75% • Less than 364 days 1.00% 5) The RBI Governor in a recent interview conveyed that interest rate on Reverse Repo is within its purview and not within the MPC. Therefore, Reverse Repo auctions can be restricted to Treasury Bills at the respective rates. 6) The Government of India and Reserve Bank of India can create the additional liquidity temporarily so that Government of India can manage to raise these resources for the current year at a low cost. To this end, for at least next 18 months it need not raise any long-term loans beyond 10 years. 7) When Government of India can turn at least 75 percent of its current outstanding, it can save Rs.4,00,000 crores of interest annually for the next 10 years. The Government of India and RBI together should cognise that saving interest outgo is an exercise of convergence. It will help reduce revenue deficit and hence the fiscal deficit. When the Government of India is affected, the whole nation gets affected. RBI’s mission and mandate are for the people of India. The Reserve Bank of India and Government of India need to act to reduce the outgo of interest from the Government of India. This needs to be acted on expeditiously and the exercises and action needs to be in the current year. Government of India will save Rs. 4,59,000 Crores when action is initiated within 4 to 6 weeks now without waiting for Budget 2022-23. European nations are at negative interest rates and rest of OECD are at marginally positive interest rates at .25 to .75 percent. It is therefore India’s moment to capture Rs 33,00,000 Crores equivalent of Rupee Debt at a cost between .25 to 3.35 percent for Treasury Bills by integrating the Forex Markets with the Bond Markets. The balance of Rs. 40,00,000 crores also needs to be brought within the 4 to 4.75 percent range. India will grow at 8 to 10 percent CAGR only when – • Government expenditure comes down. • Public consumption goes up. • Capital goods for long-term can be accessed for future returns. • High-cost debt as legacy is replaced by low-cost debt for all entities. • Growth needs to be in middle class housing. • Infrastructure and long-term finance are priced around 6.1 percent to 7.5 percent or lower, and stable for 10 to 30 years. • Savers interests are protected by secured long-term debt. • Inflation needs to have a balanced view. These are some among the steps that are required to be taken and need to get collaborated with the real economy. India will grow into a Rs 400 trillion economy when a series of actions are initiated for the medium and long-term.

It is a welcome news that Coal India has converted waste into wealth. Sand is going to be in perpetual requirement for a dynamic and growing building economy. This is acute in urban areas where people use sand for construction of commercial and residential buildings. Sand is also consumed in large quantities in making of concrete roads and concrete structures. There is a shortage of sand in the cities of Bangalore, in the whole state of Kerala, in Goa, where there is a pricing issue as well as a quality issue. It is earnestly requested that Coal India Ltd make trial consignments in southern parts of Maharashtra, Kolhapur district, Hubli-Dharwad and Belgaum, the State of Goa, Kasaragod district in Kerala and up to Calicut. There is a larger demand than supply, hence it puts pressure on available sand suppliers and is leading to “smuggling of sand”, “sand mafia”, “difficult to handle situations” and “when interstate issues are involved”. Coal India Ltd has no presence in Karnataka, Kerala and Goa. If sand is made available to these places it would be definitely a national endeavour. Details can be worked out based on the supply side and it is also very important that Indian Railways is involved in this exercise. Sand selling depots can be organised in smaller railway stations, where access from the road to the rail head can be managed successfully by the users. Even where sand is made available to the contractors of NHAI or Railways, it will mitigate the demand to a certain extent. But at least 40% of the sand can also be marketed to individual households who build their dream homes. The presence of Coal India will then be on all India basis, wherever sand can be made available. It is also important that if river sand is available in other parts of the world, break bulk carriers can bring it to ports – major ports where it can be then made available to consumers as well as in smaller quantities. Sand and aggregates form a very important role in building a Rs.400 trillion economy that is aspired for Government of India.

India should be a container manufacturer and a lessor nation. As a maritime nation, India has a commanding position on the water routes that go through the World. The recent attention to containers and its movement was highlighted by the blockage of the Suez Canal by a giant container vessel. India needs to specialise on “small is beautiful”. Ships across the world have grown in size and this has been engineered at shipyards based on the growing demand for the Eastern nations and the Western nations. Eastern nations have ramped up their manufacturing capacities of all the basic requirements as well as the enhanced requirements of Europe, USA, and OECD countries. The advent of marine containers started in the early 80s. Containers were basically well-designed to accommodate a fixed quantity. Now, different kinds of marine containers are easily available globally and the shipment costs by containers have reduced to some extent; the costs associated with transportation of smaller items. This has supported small and medium enterprises around the world – the ability to do, manufacture, fabricate and send across the world. The shipping companies of the world have evolved to accepting and delivering containers and this has become a major world innovation of reckoning. It would be appropriate to celebrate over 50 years of this basic change that happened in shipping. The basic change, it was an innovation that improved and expanded Commerce like never before. There are an estimated 30 million marine containers in the world. Some of these containers are owned by the shipping companies but most of it is leased from lessors. The lessors are companies around the world who specialise in this activity. The manufacture and assembly of containers require special attention as they are having rigid specifications which cannot be compromised. The steel, which goes into fabrication of containers is complex at its base but simple in its structure. The estimated cost of a container would be in the region of USD 3000, approximately Rs 219,000. 1.1) The Government of India and State Governments must get together to promote container utilisation within the nation. It brings in simplicity to operation that a container is unloaded for de-stuffing and it is available for stuffing at the same location or any other location using trailers or special lorries. A container basically is a unit which can be safely locked and kept separately and stacked. It acts like a warehouse inside and that is the speciality. 1.2) India has many Special Economic Zones where there is sufficient place for encouraging the manufacture and assembly of marine containers of all description. 1.3) This can be done by encouraging FDI or Indian manufacturers to take it up. India is not new to container manufacturing. A public sector company called Balmer Lawrie in Kolkata and others have manufactured and delivered them. 1.4) China’s engineering dominance is a reason why India has not emerged as a container assembling nation. 1.5) The container manufacture and assembling sector can be encouraged with at least 7 major manufacturers. Each of them could be given an objective target that collectively 1 million containers must be fabricated within the next three or four years. The testing facilities and the required conformity requirements will then get addressed as a cluster. Once the containers are manufactured and fabricated, they will have to be leased out. 1(i) India has developed a great NBFC sector. Among the twenty major NBFCs, at least seven of them can be encouraged to establish subsidiaries in the Special Economic Zones. 1(ii) They should be allowed capital account convertibility and associate themselves with the shipping companies of the world. 1(iii) These NBFCs can be owning the operating companies that will be leasing these containers annually or for a period of three or five years. 1(iv) Engineering majors like L&T can be invited and encouraged to make special containers. The advantage of the marine containers remaining in India is that it will be the operating base for these containers. Ultimately, they will get repositioned back to India. There is a shortage of containers currently in the world due to various factors. Eventually they will be made up. But Indian owned container ships require to be grown especially in the small and medium category. India then becomes a maritime connection to all the nations in the world, at smaller ports, and not necessarily the bigger ports of the world as these are adequately taken care of by the giants. India should advocate “small is beautiful” in the process of shipments and encourage shipping companies by registering them in the India registry; but these ships can be owned and managed from Special Economic Zones of the nation. Dollar based or Euro based financing can then be available to all these categories. It is not difficult to attract capital in India when there is regular income and profitability. India has had a very good inflow of Foreign Direct Investment and Portfolio Investment. The world is hungry for positive returns; which India can provide. It is a known fact that the lease income exceeds the investment costs. In the sense that the return on investment is higher, it is only the negotiating skills and strengths that can make a difference. With India’s vast domestic economy, another million containers will get fungible, meaning they can be deployed in India as well as in overseas nations. 1 (A)The issue about internationally leased containers getting into India is that the containers are required to be given a bond that they are to be shipped back. If they are Indian owned containers from Special Economic Zones and a blanket permit is given, these containers can be taken to any part of India and taken back to the overseas markets under the registry. 1. (B) Government of India, Ministry of Commerce and Ministry of Shipping should give the best of resources to the concept and make it implemented as early as possible since Indian exports and imports are getting uncompetitive. 1. (C) An objective support document is also ready to be made and in this regard the Federation of Indian Chambers of Commerce and Industry, Karnataka should take the lead in encouraging this concept to be established as a pioneer industry in Karnataka. The North Karnataka region is highly suitable for the handling of the activity for container assembling. 1. (D) The ArcelorMittal group has chosen Karnataka as an investment destination for its steel plant. It has already secured the land and all the citing has been done for a steel plant. A sector specific SEZ can be declared to house all the container manufacturers in one location. The demand for steel from this location will be considered as a deemed export from other steel plants of India. The ArcelorMittal group can make available the required quantity of steel overseas into the Special Economic Zone by allocating itself the Mangalore SEZ available land into both an SEZ specific activity, which is where the leasing will happen in international currency. 1. (E) The Mangalore SEZ Ltd also has surplus land in the DTA area where the domestic leasing or sales can happen. The employment generation can also happen if the global container surpluses can be brought into Karnataka, where it can be reconditioned and refurbished or sold as scrap. All these activities are a combination between the Special Economic Zone and Domestic Tariff Area. The Mangalore SEZ is well connected to the Indian railway network. Therefore, the evacuation of the containers or bringing in the containers in the Indian context can be done both by National Highways as well as by Indian Railways. The CONCOR is intended to be a special purpose vehicle. The CONCOR can be encouraged to be the first pioneer investor of having the first 125,000 containers fabricated and owned as a pioneer and at least seven other nations’ companies can be encouraged to do this. This activity must be done with effortless ease as it is highly conducive for the Indian economy to grow to a Rs 400 Trillion economy. The movement of goods in containers and pallets must be an organised activity in which India can catch up with the developed nations in the quality and ease of doing business.

India needs to be a Marine container manufacturer nation with an objective target of 1 million containers on an urgent basis. Containers are ultimately to be certified up to ISO standards and should fit the requirements of maritime certifications. It is a complex activity in delivery of any maritime equipment or service. Each of them must meet product standard, safety standard and service standards. The ability to withstand certain conditions requires to be met. The frame and body of the container are made of special steel. The floor of the container is made of wood or bamboo. The weight, which is called as tare of a container, is around 2160 kilos. If India were to become a container manufacturer nation, then it would be a lessor nation. India should begin forthwith on being a lessor nation with imported containers or containers made from imported steel. India must do this both competitively, cost-effectively and with a nationalistic perspective, as both manufacture and all road regulations, rules, and laws, international and national, should be converged at one location which will handle the entire project must be classified as a national priority. A nodal agency, like the Projects and Equipment Corporation of the Ministry of Commerce or a consultant like RITES, who will have a multi-disciplinary approach, a consultant like TCS, which will provide the digital support, the Exim Bank of India to finance as a backup; participating finance companies to do the working capital finance as well as act as Special Purpose Vehicles – all need to be in partnership for servicing the stakeholders. The Government of India, Ministry of Commerce, Ministry of Shipping and Ministry of Industrial Development should envisage that this requires to be of international standards in all aspects. The cost of Finance to the lessor should be moderate at less than 3 per annum for the working life of the container, which can be three years or five years. Containers need to be refurbished, recycled, scrapped and all this activity is basic. India is a labour surplus nation and hence all aspects of container activity, like the reuse of containers will have better prospects in India than anywhere else in the world. The Logistics moving in containers has advantages that will accrue. Used containers have great potential to be given to farmers to store their nutrients or their products respectively, which means ultimately 100,000 or 500,000 used containers can get into the villages rather than building separate concrete and other store houses. These are also movable. Small enterprises and medium enterprises can use these containers for temporary storage rather than build warehouses. All of this requires a coordinated activity between all the national and state trade organisations and local associations to accept containers as a way of life, and make service providers and stakeholders involved in this process. Containers can be refrigerated. Container leasing activities should be headquartered in Special Economic Zones, given it will be worthwhile to make a Special Economic Zone by government order just for having this ecology right across at least 20 Special Economic Zones in India. The Indian Railways and Organisation CONCOR, who are already experienced in handling empty and filled containers have the required expertise in house. India can adapt to container manufacture easily. Therefore, the foreign trade policy must have special mention of both containers and container vessels and supporting shipping requirements like ocean going barges can be employed for domestic container movement, but the containers will always be of ISO standards. Therefore, the customs regulations and GST regulations and all of this will get compatible to this activity. An objective target of 1 million containers would mean that the positioning of these containers starts in India and ends in India. Globally, this activity is carried on in specialised areas and India needs to have this specialisation. The cost of a container is determinable and is not a large amount compared to other projects. India has classified several industries as infrastructure industries for the sake of infrastructure lending. Infrastructure lending if it comes to higher than world costs will render long-term issues for Indian lessors. Container owning or releasing is an integrated activity that even the major shipping lines can be invited to own containers in India to be positioned in India. They will go by their own standards and hence their requirements are to be understood that some of them may have the position for 5 to 10 years and some of them may not have it for 10 years, but they would be willing to look at it as considering India as a growing and important market. Indians abroad would have to be enthused in this activity as profitable that all the entrepreneurs take this as a return-based activity and not out of pure consideration for investment in India. Container leasing is not risky. It does not have high returns, but it is so basic that the Government of India, State Governments and the necessary agencies like Railways, National Highways and all take part in this activity by providing the facilities for container yards. National Highways and Railways can work together to have container yards in every 100 kilometres where Railways and National Highways converge. An example is a container yard in Balli, Goa, where the distance to the National Highway is only one kilometre or less than that, to a Railway siding. Container yards repeated every 100 kilometres would mean that the Railways can bring in 80 containers at a time and offload it at the yard while the trucks will take them to their nearest destination. This requires convergence of digital, human and requirement elements that requires a national approach for ease of doing business, but more important to bring down the near-term and long-term costs. Container positioning out of India will ultimately have an impact in Indian and global movement of all kinds of merchandise enabling India’s share in global trade to move up. 1) Total containers – 1 million 2) Description (20-foot equivalent) – 2280 kg tare 3) Total manufacture and assembly involved – 2.3 million tonnes 4) Special steels required – COR-TEN Steel 5) Operations requirements – Free zone – Manufacture in SEZ -Leasing from SEZ 6) Life of Container – 20 years 7) Cost of capital – 20% 8) Operations requirements to export and import – Favourable custom regulations 9) Leasing operation in India – Optional but likely to be favourable 10) Cost per container when Exchange Rate is USD 1 = Rs 73 – Rs 292,000 (4000 USD) 11) Total investment involved – Rs. 29,200 crores Acknowledgement: Webinar organised by Maritime Gateway on June 3rd 2021

There lived an affectionate grandmother in a home and as was the practice in early days, she was lovingly taken care of by her family. She used to enjoy betel leaves with an areca nut after lunch and supper. In India, especially in our region, small shops always make available betel leaves for the traditional paan, which is somewhat different from the ‘Banarasi paan’. It is a simple preparation. Many people would choose to buy this betel leaf in these small shops and consume it from there but this lady used to do it at home herself. She had a loving grandson, who used to bring her the requirement once in few days. Her grandson noticed that his grandma was always using the yellow betel leaf which had got ripened, whereas other people always consumed it fresh and green at shops. So, he used to chide her, “Grandma, you should not eat the yellow leaves, as I’ve brought you a fresh set.” But she smiled and replied, “No, I cannot throw away these. I will eat these as I have it.” This happened for months and years and the grandson was never able to tell her or deprive her of the fresh leaves. And their saga continued. She always used to take the yellow leaf even though he used to bring her the fresh green leaves, which she kept away and consumed only after the earlier set of leaves were exhausted. I would call this as the “yellow betel leaf syndrome”. When we are overcome with kindness and affection our perspective that one should have fresh is forgotten. The grandson could have waited till the grandmother consumed it totally and then could have provided her with a set of fresh green leaves. Otherwise, she would never change. It is a matter of only 3 or 4 days. We are governed by habits. If all the time we are using something which has outlived its usefulness and then we keep buying something fresh, we are compromising the value in freshness that we are seeking. But we are happy with it. When it comes to social life, economic life and political life, the yellow betel leaf syndrome will always be prevalent. Whether any external circumstances will remove this inertia, like if it suddenly happens that, betel leaves do not come to market for six days, only then would both accept change. If it is a conscious will that we should stop taking anything that is not good, then it is a matter of decision. The grandma will never change the habit. The grandson will have to do it kindly. He would have to find a reasonable excuse not to give her and watch her till her yellow leaves are over and then give her fresh ones. But if she insists that she will take only a yellow leaf, it is her choice, isn’t it? This is how a matter of change or addressing change could happen in myriad ways. Yellow betel leaves syndrome will remain in our lives, especially the political life – let everything remain as it is because we are not able to accept change nor do we believe that change is necessary! But increasingly change is being demanded, especially when external circumstances demand it, then there would be a sudden decision. Plan change, we are told it is smart. The transformation process can be political entrepreneurship, economic entrepreneurship, or social entrepreneurship. The entrepreneur is not confined to the area of business. Entrepreneurship is to recognise the changes. It is an observation process. And when a resource has outlived its purpose, entrepreneurship can take over when an entranced person is comfortable, but what is being done will not accept the change, the entrepreneur will engineer the change. And this observation has been prevalent for last maybe thirty known centuries that man has adapted to change. But now innovation is a tool of the entrepreneur, the entrepreneur recognises the change and becomes an instrument in handling change. This process when determining a fact that a resource has outlived the purpose and is no longer necessary and redundant is called, “creative destruction”. This term was coined by an Austrian economics Professor, Joseph Schumpeter, and followed by a school of economists – the Austrian School. The Austrian School of Economists bring reason into their studies as well as application processes. India has enormous potential for creative destruction and it is the right time for us to address this as the rapid impact of rapid change will resolve a major portion of our current crisis. Massive lead for employment, which we call as the employment of the masses beating the supply imbalances of our earning as well as deserving populace leads, transformation of our resources from a lower to a higher yield, that the land, labour and capital, improving our organisation, to organisational effectiveness, wherever be that organisation, in government domain, in public areas in areas where we serve the people whether it is by the basic production, manufacture, services and delivery of utilities. Quality is part of this process and Quality Management has improved tremendously in the last 50 years. It is now a discipline. We, therefore need to develop the practices of entrepreneurship.

India is an edible oil deficit country and is capable of both using and exporting soya meal. The sugar mills in India do not have profitability currently and many are having solvency and liquidity problems. They need a special package to: – Incentivise sugarcane produce to soyabean by themselves but also in neighbouring villages with small holders. – Sugar mills are free from March to September, so that they can devote attention to the edible oilseed. Edible oil production in India can go up dramatically. Sugar mills can be incentivised to have the crushing units of soya beans at the same quantum as they do the sugarcane. Soya bean crushing at the rate of 2000 metric tons per day for 24 hours brings in a huge economy of scale. The supply chain must be managed with assured supply as in sugarcane now. The soya bean crushing can begin after the sugarcane crushing is over. As there would be a value chain, the producer companies can be encouraged to bring the soya bean into silos or warehouses and store it under a warehouse receipt system and sales can happen progressively. Beginning from 1st of March till the 30th of September or till availability, these giant mills can turn out both soya bean oil, soya bean by-products and soya meal extractions, which can then meet the requirements of the feed industry in India. Soya meal is an attractive export item as well as used as animal feed ingredient. Sugarcane mills have got the expertise in handling all aspects and Government with State Governments can give an investment promotion scheme with farmers as shareholders and stake holders through the Producer Companies. India is a land where the efficiency of capital must go high. It does not need to have sugar inventory when there is a formal exchange process of internationalisation of the sugar economy. At least 6 terminals can be made at major and minor ports in order to both import and export sugar in as much as that, if there is a requirement that Indian consumption goes up, the markets get equalised in the world. But India is at an advantage with its vast consumption. Encouragement of use of sugar in processed food with other Indian surpluses like pulses or ground nuts or similar is necessary. At least 400 million people can have better standards of life. The State Governments should encourage moderate shift from rice to groundnuts in both the Kharif and Rabi crops, so that the protein needs of the population grow as the consumption grows. Protein needs should get more importance than carbohydrates. India has many rice varieties and rice crops. Soya bean can be grown only during the Kharif crop. Therefore, rice surplus states like U.P, Haryana and Punjab need to push rice farmers to grow soya beans. An aggressive drive can generate 10 million metric tonnes of soya bean production additional in India instead of rice and sugarcane. Therefore, the agricultural economy should get into a mixed crop tactic as Dr Swaminathan said – Multi-cropping is the best insurance. Each farm should be encouraged to have at least 3 crops by rotation – pulses, oilseeds sugarcane – which are then aligned by market information and artificial intelligence. The sum of the total harvest will be predictable if the farmer is identified from the ground, right up to the market. It is ideal if soya bean crushing is handled at the junctions of National Highways and Railways, so that the evacuation of the soya meal can be by containers or wagons to various destinations to which soya bean meal is now exported from India. The ecology and efficiency of all soya bean meal manufacturers are high. The Indian shipping industry and transportation industry can expand from dedicated port terminals by having a logistics critical path from all sugar mills as well as from soya bean extraction mills, within a range of 50 kilometres. What India needs now are proteins. Suitable proteins are available in the soya bean. There are different types of soya beans in the world, and in India, optimisation of soya bean cultivation can be an extension that existing rice and sugarcane farmers can be incentivised to produce soya bean. There is a short-term surplus in sugar and rice in India. The strategy for India should be to increase the domestic economy to be competitive in the World Economy.

Sugar has been produced in India since ancient times and the sugar industry is a big business in India. At present, this is the second largest agro-based industry of India after cotton textile industry. White sugar is not good for health. Different health organizations have different recommendations for the amount of sugar you should limit yourself per day. But they all agree that there’s room for some sugar in a healthy diet. Hence, the consumption of sugar in this nation should be meant for the poorer people of India. So, the Government of India can impose GST at 12% on sugar. Therefore, sugar should get directed into the bottom of the pyramid. Rich people and people with diabetes will not consume sugar. Sugar that goes into food preparations, pharmaceuticals and related will help the sugar economy. So the Government of India will realise a higher revenue along with State Governments. Sugar production in the nation is higher than its requirement. Sugar draws a lot of energy as well as water from the system. Soil nutrients like Urea are subsidised and therefore the overall costs to the nation are high. It would be therefore good to regulate the sugar production economy by imposing a necessary condition that all sugarcane farmers should form themselves into a producer company. Every sugarcane mill should be buying from a producer company and not necessarily from individuals. Individuals and groups can continue to make jaggery with it or give it to vendors of sugarcane juice. The sugar mills are well organised and producer companies can be supported by the state and central governments by channelling the necessary infrastructure and assessment. The sugarcane economy is working at the optimum efficiency level. The producer, the farmer and the delivery system are well organised and all the sugar cane producers are now in the formal payment system. Sugar companies have established accounting relationships with the sugarcane farmers. The beauty of the sugar mill system and relationship with the farmers is that 100% of the produce is purchased with all facilities given to the producers from harvesting to delivery. This ecology is great for the nation. India needs to have sweets for the poor. They can make it themselves in home industries. Therefore, the Indian economy should drive the sugar economy into making the right chemistry for sweets to reach the poor every week. Sweets mean celebrations but overindulgence in white sugar has health issues. The calories required by the labour class can be enriched with energy bars, so that nutrients are absorbed by a low-income family. They need to consume it directly rather than through the cooking process. The food processing facilities that are required can follow the strategy of FMCG giants. There should be a baker in every village or can be created. A value chain can emerge from the sugar industry. The number of farmers who are employed in the sugarcane growing can be incentivised to move to the quantum of required production of what the nation needs in a regulated way by incentivisation, motivation and also technology transfer especially crops like soya bean, green gram and ground nuts.