Anupam Manur Ko Gussa Kyon Aata Hai?
Forty years ago, in 1984, two relatively unknown economists, Mark W. Frankena and Paul A. Pautler of the Bureau of Economics of the US Federal Trade Commission, wrote an extensive paper (it was 184 pages long) on why regulating taxis and taxi fares is often a self-defeating exercise.
On taxi regulations, they wrote:
“In addition to causing misallocation of resources, taxi regulations adversely affect the distribution of income. Low income people spend a larger percentage of their incomes on taxis than do high income people, and in many taxi markets consumption of taxi rides per capita is higher for low income people. As a result, entry restrictions, prohibitions on shared-ride service, and other regulations that increase fares and waiting times impose a disproportionate burden on low income people. Restrictions on the number of taxis also limit the employment opportunities of less skilled workers.”
The Karnataka government did exactly the opposite. On February 3, it announced uniform fares for cabs operating under aggregator rules by firms like Ola and Uber, as well as for city taxis (non-app-based city taxis). The new fare structure has a rigid three classes, depending on the cost of the vehicle.
Our very own Anupam Manur writes in his fiery op-ed for Moneycontrol:
“There’s ridiculous and then, there’s this! In a long list of antagonist policy decisions taken against cab-aggregators by Indian state governments, the latest one by the Karnataka government takes the cake. In a policy that plans to emulate the pricing structure of the city’s autos, the Karnataka government plans to fix prices for all taxis in the state.”
Lekin, Anupam Manur ko gussa kyon aata hai? Let us explain.
Anupam says that the transport department’s decision has discarded all nuance and sophistication and reduced the complex pricing algorithm, which takes into account traffic conditions, time of day, demand and supply, route complications and a whole other host of factors into a simple black and white fare structure.
“Prices act as an incentive and as a signal,” he writes. “If price controls (placing limits within which the price can move) were bad enough in distorting the market mechanism, fixing prices is many shades worse. There will be shortages and excesses in the market as price signals no longer work.”
He says:
“If we discard the political economy of making these laws to favour a narrow set of interest groups and look at ways to genuinely improve cab availability and prices, there are a number of things we could do. Allow taxis to charge dynamically and equally importantly, according to the time spent on the road. Market conditions are dynamic – demand varies according to various factors, but supply, however, is fixed. Even in peak hours, the number of cab drivers does not magically increase. This can change – remove the rule which distinguished commercial yellow boards and personal white boards for cars... The allure of fixing prices is understandable, but ignoring the weight of evidence and basic economic principles is unforgivable. Prices work. Don’t interfere with it.”
You can read Anupam’s column, complete with righteous anger, here.
The 32nd Flavour May Have Some Issues
If a certain global ice cream brand were government, there would be a 32nd flavour introduced — artificial intelligence (AI) — without much thought given to public benefit, taste acceptance, price structure, etc. “We have money, we have a flavour, let’s get the thing going.”
That money is ₹10,000 crore, and the 32nd flavour is the government of India’s AI computing mission. This initiative seeks to create a ‘sovereign AI’ computing infrastructure that can provide computing resources as a service to Indian startups, particularly in the sectors of agriculture, healthcare, and education.
What could go wrong? A lot, writes Bharath Reddy:
First, there is a massive demand for the current generation of NVIDIA GPUs like the H100, which power AI-related tasks, and the lead times stretch up to 52 weeks. Even if the government orders these GPUs now, they won't be able to use them until a year later. By then, newer and more advanced GPU models may be available, and the number of cloud service providers that offer AI computing infrastructure is also likely to increase…
Second, managing computing infrastructure demands specialised expertise and continuous investment to stay updated with the latest hardware and software. It also lacks the seamless integration with other services typically offered by commercial cloud providers. Third, the government's allocation of computing resources to important projects disrupts the efficient allocation of resources usually achieved by market pricing… Lastly, the social cost of the government's spending is high; every ₹1 spent is estimated to cost society ₹3 effectively. Such spending is only justifiable if the societal benefits exceed this high threshold.
You can read Bharath’s perceptive piece here and hope for a clearer, more targeted policy.
A Top-Level India-China Meeting is Overdue
Not-so-fun fact — The last time Indian Prime Minister Narendra Modi and Chinese President Xi Jinping met formally for a summit engagement was in 2019. They have met each other after that, but those meetings can best be described as informal.
Two more not-so-fun facts — China has not stationed an ambassador since October 2022, and Xi refused to attend the September 2023 G20 meeting in New Delhi.
What gives?
Manoj Kewalramani writes in The Fulcrum, a Singapore publication:
“While both countries continue to engage and even collaborate when their interests coincide at multinational forums, high-level political engagement is in a state of suspended animation. First, both countries have experienced simultaneous expansion in their respective interests and capabilities. Second, while both countries have risen, there now exists a deep power asymmetry between them. Third, Sino-U.S. strategic competition and deepening India-U.S. ties weigh heavily on the relationship.”
It is not just at the government level. Manoj, Takshashila’s head of the Indo-Pacific Programme, explains how the people-to-people relationship between the two sides has deteriorated:
“The pandemic disrupted travel. But more significantly, the past four years of friction and political discord have resulted in a worsening of mutual perceptions. At its height towards the end of the 2000s, China’s favourability rating among Indians was around 40 per cent; the latest Pew survey in 2023 put this at 26 per cent, with negative opinions about China in India rising from 46 per cent in 2019 to 67 per cent in 2023. Indian media coverage continues to view China from the lens of the country being a threat. Likewise, in China, India is increasingly being viewed from a threat-prism.”
There is a deeper problem, though: strategic perceptions. New Delhi believes that while Beijing talks about shaping a new multipolar world order, it desires unipolarity in Asia. This is an unacceptable proposition from India’s perspective.
Manoj’s piece can be read here.
Science Fiction as a Beacon of Hope
First, the background: There was a big controversy in the science fiction community last month when it emerged that the 2023 Hugo Awards, decided at the world convention in Chengdu, China, in October, had inexplicably disqualified a few prominent entries from the list of nominations. Those quietly dropped included R F Kuang’s bestselling Babel and Xiran Jay Zhao's Iron Widow, prompting suspicion that they might have triggered Beijing’s censorship filters. Even an entry by the legendary Neil Gaiman was disqualified. A couple of heads have rolled since then, but the mystery remains.
That China indulges in censorship is no surprise, but it is not just China. Other platforms have used their power to “cancel” some writers. Politics in art and literature is not news, to be sure. Yet, global conflicts have brought this back into focus. And what of the future, then?
Takshashila co-founder Nitin Pai says if there is one genre of literature that primes us for the future, it is science fiction.
“Some of humankind’s big achievements of the past century — space exploration, global communications and avoidance of nuclear war — were in part due to the science fiction writers who imagined them first. Surveying the scene today I see that dystopian themes dominate. Twelve of the twenty nominees of the 2023 Goodreads Readers Choice Awards for Science Fiction had dystopian themes, up from six the previous year. To add to Orwell’s totalitarian state, Huxley’s eugenics, Atwood’s patriarchy, Miller’s nuclear annihilation, we are now filled with dread from artificial intelligence, techno-capitalist and post-human futures. Quite a number of books feature a post-apocalyptic world brought about as a result of climate change. In comparison to the dozen or so ways in which we will arrive at a dystopia, there are very few that offer hopeful or balanced visions of the future world.”
Read Nitin’s piece here.
Takshashila’s Academic Conference: A Huge Success
Over the weekend, Takshashila’s latest GCPP academic conference made for some intellectually stimulating discussions in subjects as diverse as geospatial technology to Arthashastra.
Speakers included Narayan Ramachandran, Nitin Pai, Pranay Kotasthane, Anupam Manur, Lt Gen Prakash Menon, Malathi Renati, Rohit Lamba, Shambhavi Naik, Manoj Kewalramani, Sarthak Pradhan, Bharath Reddy, Sridhar Krishna, Amit Kumar, Anushka Saxena, Shrikrishna Upadhyaya, Y Nithiyanandanam, Bhuvna Anand, Bharat Sharma, Kajari Kamal, GK Ananthasuresh, Ashish Kulkarni and Shivshankar Menon.
You can find updates here, here, and here.
Wait, There’s More
Pranay Kotasthane continues to make waves with his new book ‘When the Chips are Down’. This week at Bangalore International Centre he will be in conversation with technologist Dr Shrinivas Gorur. Click here to RSVP.
We announced the NAST Fellowship last week. In case you missed it, then make sure you spread the word this time around. All the details are here.
Our favourite podcast of the week features Kripa Koshy (Programme Manager, Takshashila) and Anirudh Dinesh (Research Fellow, Burnes Centre for Social Change and GovLab affiliated with Northeastern University), where they discussed old and new ways of citizen engagement for more effective governance and policy making. Listen to the fascinating discussion here.
The latest episode of Police Chowki was out today. In this episode of Police Chowki, Shrikrishna Upadhyaya speaks to former police officers S. Ramakrishnan and Javeed Ahmad on the fascinating world of mounted police, exploring their historical and modern-day role in law enforcement, public safety, and ceremonial functions. Listen to it here.
This Friday, we have the next edition of Organise for Change (#OFC) coming up exclusively for our alumni. Click here for all details.
That’s all from us this week. Take care!