GREEN IS THE NEW BLACK!

Merely taxing diesel vehicles can backfire!

The debate on subsidy on diesel price never seems to reach a consensus. On one hand, diesel subsidies are important to keep food prices and transport prices under check, while on the other hand, this subsidy is being exploited by luxury car owners and owners of commercial hubs. In simple words, tax paid by the aam adami which is meant for societal development is latently being directed as subsidies to industrialists and rich business houses! Thus it becomes far more important for the government to either come up with a differential pricing system or some other model which categorises these two different set of users under two different price bands.

In the same light, the Supreme Court has recently floated a proposal to impose “a green tax on new and existing private diesel vehicles to check pollution in the National Capital Region.” The bench proposed to tax diesel vehicles with a green tax that would be 25 per cent of the cost of the vehicle. This is to make sure that the subsidy being offered in form of lower diesel prices comes back to the government. The initiative looks quite promising but then there are lots of misses between the cup and the lip. These taxes may later increase the sale of second hand diesel vehicles (which is more polluting) and may deter the sale of new diesel cars.

Contrarily, green taxes are a globally practiced method of encouraging green-vehicles and not the other way around. A report by Professor Robert N Stavins of Harvard Kennedy School published by Harvard University states that such initiatives can accrue ‘double dividend’ as it will discourage non-green vehicles and also would be a source of new revenue for the government. However, merely collecting taxes and fines won’t solve the purpose. There needs to be a system of using the collected amount in more judicious manner, especially towards refurbishment of traffic and transport structure. As per Media report published in November 2012, Pune despite of collecting Rs 4 crore (out of polluting vehicles in form of green taxes) failed to utilise the money for any purpose, leave aside using the same for pollution control. Nagpur is another example wherein they raked in Rs 1.30 crore but again didn't use the money for any pollution control measures. The same is true for cities across the nation.

Almost all countries across the world are tweaking with their green taxes with an objective of eliminating polluting vehicles in next couple of decades. Sweden is all set to increase taxes by almost 35 per cent on polluting cars while exempt taxes on electric vehicles to push green-electric vehicles on the road. Similar measures are being adopted by other EU nations including Germany that went steps ahead in implementing taxes that would encourage the manufacturers to design greener cars! Similar systems are also present in UK, US and Australia.

The proposal suggested by the Supreme Court should, along with taxing polluting vehicles, have provision of floating market with affordable electric and hybrid cars and cars running on gases. This multi-dimensional policy would serve dual purpose of both preventing misallocation of diesel subsidy and enhancing pollution control measures. The Supreme Court recent decision should also keep in consideration the cost of manufacturing diesel vehicles. Given the fact that diesel vehicles are relatively expensive than their petrol counterparts, such taxes can further dent the automobile market. The Supreme Court and the policy makers should include clause that provides incentive to green vehicles manufactures and dealers. Let this policy be not a half-backed and self-destructive one!

IITF IS STILL AN INFANT

Expos and trade fair needs to match the global standards

The importance of trade fairs has never been so profound. The recent IITF 2012 opened the gates for budding as well as established enterprises to showcase their products and services that eventually allows them to display and project their services not only to their potential customers but to the entire region at large. The power of trade fairs notwithstanding, it is fascinating to delve into its genesis that dates back to the medieval era in Europe. Since then, its impact has grown from strength to strength through the industrial revolution in Britain and Europe and later in North America. The trade fairs, in fact, became the face of industrial revolution that reflected its vitality and showcased the same to the world.

The trade fairs, unlike consumer fairs, do not have any restrictions to curtail the entry of the general public. Thus, the hype that surrounds the event invites the participation of not only professionals and company representatives but also the intrigued public. The large trade fairs are gala affairs that attract an onslaught of advertisements and media frenzy that is, even sometimes, carried on as developmental strategy for the host city. The biggest trade fair in India is India International Trade Fair (IIFT) which takes place at Pragati Maidan in New Delhi. It has entered its 32nd year in the 2012 event with a deep reservoir of strength in their roster of 7,000 exhibitors that include 350 overseas firms’ participation across 28 countries. It can also boast of 1 million visitors last year that turned the organisers proud that a world class trade fair atlas is beginning to take shape in India. Some of the other Indian trade fairs include the India Int’l Maritime Logistics Expo in Mumbai, International Leather Goods Fair in Kolkata, India International Leather Fair in Chennai, Arogya in Trissur and Aahar – The Int’l Food Fair in Shillong, to name a few.

However, in spite of commendable efforts to retool and upgrade the Indian trade fairs, it’s still way below the global standards. The Canton Fair held in Guangzhou, China draws 207,103 participants from across the globe taking place at a state-of-theart venue with world class infrastructure that’s beyond the imagination of the IIFT’s unglamorous grind. The total size of exhibitors in Guangzhou crossed 24,415 professionals hailing from over 200 countries with total business transaction touching a humongous $ 36,800 million last year. It boasts of wonderfully craft ed pavilions separately for national and international participants drawing huge pool of visitors. In its 105th session, the data for number of booths surpassed 55,800 with business turnover of $ 262.3 million and was attended by 165,436 visitors. In Germany, Angela Merkel endorsed a massive 134 international trade fairs that encompassed 159,945 exhibitors of whom 55.4 per cent are foreign nationals. Leading the pack of quality as well quantity gap is United States, which host 2,500 trade shows every year! The coveted top position is occupied by Consumer Electronics Association’s International CES held every year at Las Vegas Convention Center with an expansive 1,442,000 sq ft floor space, followed by The Association for Manufacturing Technology’s biennial International Manufacturing Technology Show in Chicago and Packaging Machinery Manufacturers Institute’s biennial Pack Expo also held in Las Vegas. These are world shows where Indian trade fairs don’t stand a chance to compete, be it scope, size or frequency. Indian shows, run-down and neglected looks need a boost at the earliest because in this age of publicity, Indian products and services along with its image should be light-years ahead of where Indian trade fairs are stuck in today!