PM IAS DECEMBER 28 – 29 EDITORIAL

1. A progressive step: Formation of a panel to look into withdrawal of AFSPA from Nagaland is a welcome move

---

Context: The announcement by the Nagaland government that a high-powered panel will be set up to look into the withdrawal of the Armed Forces (Special Powers) Act in the State addresses a key concern in the Northeast following the Mon massacre where a botched ambush by an armed forces unit led to the deaths of 15 civilians earlier this month.

2. The Ministry of Home Affairs (MHA) — whose Additional Secretary (Northeast) is to head the committee — has been tight-lipped about the proposed panel with the information about it emanating only from the Nagaland government.

Importance of the move:

3. The gesture to set up a panel, even if it is acknowledged only by the Nagaland government, should help in assuaging some concerns of citizens of the State who had immediately associated the massacre with the impunity afforded by the unpopular Act.
4. The Indian Army has also reiterated that it deeply regretted the loss of lives and that a probe into the incident was progressing, even as the Nagaland government in its statement mentioned that a court of inquiry will initiate disciplinary proceedings against the Army unit and personnel involved in the incident.

The AFSPA: The Act is in place in Assam, Nagaland, Manipur, three districts of Arunachal Pradesh, and areas falling within the jurisdiction of eight police stations of the State bordering Assam, with the authority to use force or open fire to maintain public order in “disturbed areas”.

5. The support for AFSPA: the Act has remained in place because of the resolute opposition to its repeal by the Army.

The demand of revocation of AFSPA

6. The Meghalaya Chief Minister has already sought its revocation in the Northeast, while Manipur is also set to discuss the demand for its repeal.
7. People in the Northeast associate the series of civilian killings in the region over a number of years with the Act being in effect.
8. The Justice Jeevan Reddy Committee set up by the previous UPA-led government at the Centre in 2005 had recommended the repeal of the Act calling it “highly undesirable” and that it created an impression that civilians in the Northeast were being targeted for hostile treatment.

Way Forward:

9. The panel can take recourse to studying precedents — Tripura revoked the Act in May 2015 after noticing an improvement on the ground in the State while Meghalaya did the same on April 1, 2018.
10. Both States did so after the Act was in force for decades. A clear-cut understanding on the definition and the extent of “disturbed areas” in Nagaland following discussions among the State, the MHA and armed forces’ representatives will go a long way in working towards a rethink on the Act’s relevance in the entire region.

1.  

2. The gaps in the plan to tackle plastic waste: The draft regulations on extended producer responsibility are retrogressive in their approach

---

Context: In October, the Environment Ministry published draft regulations on Extended Producer Responsibility (EPR), set to come into effect by the end of this year. Disregarding the commitments made by the Solid Waste Management Rules, 2016; the Plastic Waste Management Rules, 2016; and the Swachh Bharat Mission (SBM), these regulations denote a backslide, particularly with respect to integration of the informal sector.

Plastic packaging can be roughly grouped into three categories:

• Recyclable and effectively handled by the informal sector,
• Technologically recyclable but not economically viable to recycle,
• Technologically challenging to recycle (or non-recyclable).

The Concept of Extended Producer responsibility(EPR)

• EPR requires the manufacturer of a product, or the party that introduces the product into the community, to take responsibility for its life cycle.
• An FMCG company should not only account for the costs of making, packing and distributing a packet of chips, but also for the collection and recycling/reuse of the packet.
• Before 2016 rules: EPR was left to the discretion of the local bodies.
• Now: Producers and Brand owners have been made responsible for collecting waste generated from their products. They have to approach local bodies for formulation of plan/system for the plastic waste management within the prescribed timeframe.

Waste segregation & Collection system in India – the backbone of EPR:

• For decades, waste pickers, working in dangerous and unsanitary conditions, have picked up what we throw away. In India, producers have externalised these costs due to the presence of a robust informal sector composed of waste pickers.
• They form the base of a pyramid that includes scrap dealers, aggregators and re-processors. This pyramid has internalised the plastic waste management costs of large producers.
• Besides, by diverting waste towards recycling and reuse, waste pickers also subsidise local governments responsible for solid waste management.
• Further, they reduce the amount of waste accumulating in cities, water bodies and dumpsites and increase recycling and reuse, creating environmental and public health benefits.

Problem with the recently released guidelines:

• Rag-pickers not included: It fails to mention waste pickers or outlining mechanisms for their incorporation under EPR.  
• Disregard of the existing chain: The SBM Plastic Waste Book attributes India’s high recycling rate to the informal sector. The guidelines don’t involve them as stakeholders in formulating the guidelines, instead it directs producers to set up a private, parallel plastic waste collection and recycling chain. This contributes up to 60% of their incomes, which will likely be siphoned away from them and channelised into the new chain.
• No Social security: Unfortunately, most informal waste pickers remain invisible. Between 1.5 and 4 million waste pickers in India work without social security, health insurance, minimum wages or basic protective gear.
• Limited scope: It is limited to plastic packaging, while a large part of single-use or throwaway plastic packaging are other multi-material plastic items like sanitary pads, chappals, and polyester that pose a huge waste management challenge today, but have been left out of the scope of EPR.
  • Issue of recycling of contaminated plastics: Typically flexible plastics like LDPE and PP bags are recyclable, but due to their contamination with organic waste, light weight, and high volume, the costs of recycling are prohibitively expensive relative to the market value of the output. Market value for these plastics can be increased by increasing the demand for and use of recycled plastics in packaging, thus creating the value to accommodate the current costs of recycling.
• Multi-layered and multi-material plastics to continue: These are low weight and voluminous, making them expensive to handle and transport. Since they are primarily used in food packaging, they often attract rodents, making storage problematic. Even if this plastic is picked, recycling is technologically challenging as it is heterogeneous material. The Plastic Waste Management Rules mandated the phase-out of these plastics. However, in 2018, this mandate was reversed.
• Misunderstood Processing: Not all processing is recycling. Processes like waste-to-energy, co-processing and incineration have been proven to release carbon dioxide, particulate matter, harmful dioxins and furans which have negative climate and health impacts.
• No case for investment support: Technologies like chemical recycling and pyrolysis are capital-intensive, yielding low returns and running into frequent breakdowns and technological problems. They also release carbon dioxide and other pollutants. GAIA estimated that such technologies wasted at least $2 billion in investments, due to permit complications, operating costs, etc. While the environmental impact and desirability of these processes continues to be debated, the draft regulations legitimise them to justify the continued production of multi-layered plastics.

Way Forward:

• Involve ragpickers: An effective EPR framework should address the issue of plastics and plastic waste management in tandem with the existing machinery, minimise duplication and lead to a positive environmental impact, with monitoring mechanisms including penalties for non-compliance. 
• Fund and Utilize exiting chains: EPR funds could be deployed for mapping and registration of the informal sector actors, building their capacity, upgrading infrastructure, promoting technology transfer, and creating closed loop feedback and monitoring mechanisms. For easily recycled plastics, EPR requirements could have been fulfilled by formalising and documenting the work of the informal sector and adequately compensating them.
• Government must regulate the job: Without strong government regulation, the millions of workers who have shouldered the burden of waste management for decades will stand to lose their livelihoods – only so that companies can keep meeting their targets to continue producing plastic.
• Addressing infrastructure needs: the government could support and strengthen the informal recycling chain by bridging gaps in adequate physical spaces, infrastructure, etc.
• The mandated use of recycled plastics, as prescribed in the draft regulations, is a strong policy mechanism to create this value.

Conclusion: the government should redo the consultation process for the draft guidelines and involve informal workers. The scope of plastics covered by the guidelines could be altered to exclude those plastics which are already efficiently recycled and to include other plastic and multi-material items. And end-of-life processing technologies should be closely evaluated, based not only on their health and environmental impacts, but also on the implications for continued production of low-quality and multi-layered plastics.

DECEMBER 29:

​​1. Trade defence: A reflexive resort to the anti-dumping duty risks skewing market dynamics

---

Context: The Central Board of Indirect Taxes and Customs (CBIC) recently notified the imposition of anti-dumping duty on five products manufactured in China in order to safeguard domestic producers from lower-priced imports that the Directorate General of Trade Remedies (DGTR) had found as being ‘dumped’ in the Indian market.

2. These duties were imposed following recommendations of the commerce ministry’s investigation arm Directorate General of Trade Remedies (DGTR).
3. These might remain for up to five years.
4. Notification by Central Board of Indirect Taxes and Customs (CBIC): the duties have been imposed on:

• Certain flat rolled products of aluminium for solar modules;
• Sodium hydrosulphite (used on dye industry);
• Silicone sealant (used in manufacturing of solar photovoltaic modules, and thermal power applications);
• Hydrofluorocarbon (HFC) component R-32; and
• Hydrofluorocarbon blends (both have uses in refrigeration industry).
  • In almost all the five products, the Commerce Ministry agency initiated its anti-dumping investigations in September 2020 and reached its final findings about 12 months later.

Reasons for the imposition:

• To prevent dumping: CBIC’s imposition of the anti-dumping levy for five years on these Chinese products is based on the DGTR’s findings that their import constituted ‘dumping’, which was causing injury to local producers, and an ensuing recommendation that a protective duty was warranted.
• WTO Norms allow it: A remedy sanctioned by the WTO to protect a member country’s domestic industry from imports that have been priced at levels below those prevailing in the exporting nation’s home market, the anti-dumping duty has become one of India’s most widely used trade weapons, especially against a flood of cheaper Chinese imports.
• As of February 2020, India had imposed anti-dumping measures on 90 Chinese products, with another 24 China-specific anti-dumping investigations in progress at the time, according to a reply made in Parliament by Commerce Minister Piyush Goyal.

A Critique of the move:

• Skewed Indian markets: A reflexive resort to the anti-dumping duty, especially if the domestic applicant is a significantly large and relatively resilient manufacturer of the product, risks skewing the market dynamics in the Indian company’s favour.
• Higher prices for consumers & intermediate producers: downstream industries, intermediate goods, and consumers likely to face the consequences of reduced competition on final prices.
• Protectionism has not been effective in reducing imports: efforts to narrow the sizeable trade deficit with China by targeted recourse to the levy have made little headway in addressing the widening gap as imports have continued to largely outpace India’s exports.

Conclusion: With companies worldwide now seeking to de-risk their businesses from an excessive reliance on China in the wake of the COVID-19 pandemic, the prospect of more capacity in that country turning surplus and being used to produce goods for dumping overseas increases. Indian policymakers have their task cut out to bolster trade defences in time.