Protecting Indian Capital in Bangladesh

The recent dramatic developments in Bangladesh, including the resignation and flight of former Prime Minister Sheikh Hasina, have created a political vacuum and increased uncertainty in India’s eastern neighbour. Beyond the immediate political and diplomatic fallout for India, a significant concern is the impact on Indian companies operating in Bangladesh.

Introduction

Political turmoil not only disrupts the affected nation and its economy but also impacts neighbouring countries, their economies, and the investors who have invested in the troubled country. Indian companies with investments in Bangladesh, such as those by Adani and other firms, now face heightened risks. The need for legal protection for these investments has become more pressing.

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Indian Investments in Bangladesh

• Indian investments in Bangladesh span various sectors, including edible oil, power, infrastructure, fast-moving consumer goods, automobiles, and pharmaceuticals. 
• Despite political opposition, the previous Sheikh Hasina government actively encouraged Indian investment, creating special economic zones to attract investors. However, her opponents launched an “India out” boycott movement targeting Indian goods. 

Legal Protection for Indian Investors

Jeswald Salacuse identifies three primary legal frameworks applicable to foreign investment:

• Domestic Laws: These are the laws of the host country where the investment is made. Indian companies in Bangladesh can utilise local laws like the Foreign Private Investment (Promotion and Protection) Act. 
  • However, these laws can be changed unilaterally by the host state, posing a risk to investors.
• Contracts: Agreements between foreign investors and the host government or local companies can offer some protection. 
  • However, contracts may have limited effectiveness in challenging sovereign actions that adversely affect investments.
• International Law: This framework includes treaties, customs, and general legal principles recognized internationally. 
  • For Indian companies, international law provides a crucial layer of protection, particularly through Bilateral Investment Treaties (BITs).

The India-Bangladesh BIT

• The India-Bangladesh BIT, signed in 2009, aims to protect investments by imposing conditions on the host state’s regulatory behaviour, thus preventing undue interference with investor rights.

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The BIT includes 

• Restrict host states from unlawfully expropriating investments.
• Ensure fair and equitable treatment (FET) of foreign investments.
• Prevent discrimination against foreign investments.

Impact of JINs ( Joint Interpretative Notes)

The JINs adopted in 2017, aimed at overhauling India’s investment treaty practice, may have unintentionally diluted the BIT’s investment protection features:

• Taxation Measures: The exclusion of taxation measures from the BIT’s ambit limits recourse for Indian companies facing unfavourable tax regulations.
• FET Provision: Linking FET to customary international law increases the difficulty of proving treaty violations.

Thus JIN, designed to protect the regulatory freedom of the capital-importing country, might ironically benefit Bangladesh more than Indian investors.

The Larger Question

• India’s foreign direct investment (FDI) has significantly grown, with outward FDI in 2023 reaching approximately $13.5 billion. 
• As one of the top 20 capital-exporting countries, India must ensure robust legal protection for its investments abroad.

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Conclusion

Given India’s role as a major capital-exporting nation, it is essential to refine investment treaty practices to safeguard Indian interests. The case of Bangladesh highlights the need for effective legal frameworks to protect Indian investments globally. India should ensure that investment treaties and protections are beneficial for Indian investors.

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In 2022, on the auspicious occasion of the 75th anniversary of our Independence, the Government amended the Flag Code to include “machine-made polyester bunting” and simultaneously exempted polyester flags from the Goods and Services Tax (GST).

This move put polyester flags on the same tax footing as khadi flags. The Prime Minister’s renewed call for the ‘Har Ghar Tiranga’ campaign in the week leading up to Independence Day (August 9-15) offers us an opportunity to reflect on the significance of our national flag and implications of above amendments for the khadi industry.

The Historical Significance of Khadi

• The Flag Code of India has traditionally required the national flag to be made of “hand-spun and hand-woven wool/cotton/silk khadi bunting.” 
  • Khadi, the coarse but versatile fabric that Mahatma Gandhi spun and wove during the national movement, holds deep historical and cultural significance. 
  • Khadi is at once a symbol of our storied past, and an icon of Indian modernity and economic vitality.
  • It was an instrument to locate sovereignty and self-sufficiency during colonial rule and has continued to represent national integration and revitalization in independent India.
  • It was in deference to this eternal symbolism that the tricolour once bore the Mahatma’s charkha as its centrepiece, and that the modern-day Indian flag used to insist on khadi as its sole fabric.

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The Government’s Decision and Its Impact

• In 2022, the Government’s decision to include machine-made polyester bunting in the Flag Code and exempt it from GST, while placing it on the same tax footing as khadi flags, was a significant shift. 
• The Karnataka Khadi Gramodyoga Samyukta Sangha (KKGSS), the only national flag manufacturing unit accredited by the Bureau of Indian Standards (BIS), went on an indefinite strike to protest against what they viewed as a state-sponsored attack on India’s khadi industry.
• This policy change came at a time when India, no longer a global hub for polyester manufacturing, became a net importer of polyester yarn, primarily from China. This shift tends to undermine our national pride, especially amid tensions with China and the Prime Minister’s ‘Aatmanirbhar Bharat’ initiative.
• This shift would also have direct and calamitous consequences for the Mahatma’s foremost legatees — our khadi spinners and weavers.

The Broader Consequences for the Handloom Industry

• Demonetization, punitive GST policies, and the unplanned COVID-19 lockdown have forced many handloom workers to quit their professions. 
• The Government’s neglect has unravelled our handloom traditions, which are a testament to our shared history and culture.

GST Burden on Handloom Workers

• The GST burden on handloom workers is significant, with taxes applied to both the final product and raw materials such as yarns, dyes, and chemicals.
• Despite consistent demands from workers to exempt handlooms from GST, their pleas have been ignored. 
• Rising costs, particularly for electricity and cotton fibre, further strain the industry. 
  • The Vishwakarma Yojana, launched to support artisans, does not include handloom spinners and weavers, reflecting a gap in support for these crucial workers.

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Falling Khadi Procurement and Global Relevance

• Government procurement of khadi has declined as departments ignore or override mandates for its purchase.
• There has been less effort to build a global market for Indian handlooms, even as global consumers increasingly value sustainable and fair-trade products. 
• Failure to regulate the market has led to confusion between semi-mechanized khadi and traditional hand-spun khadi, impacting the livelihoods of our khadi spinners, who earn inadequate wages despite their hard labour.

The Path Forward: Restoring Khadi’s Prestige

The path forward requires reimagining the role of India’s handloom traditions in our society and economy. 

• Export Promotion: Strengthen global marketing and promotion of Indian handlooms to expand their international presence.
• Flag Code Amendment: Revoke the recent amendment to the Flag Code that allows polyester bunting and return to the use of traditional materials like khadi.
• Reviving the Khadi and Handloom Industry: Implement measures to support and revitalise the khadi and handloom sectors, ensuring their growth and sustainability.

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Conclusion

Thus, khadi as the exclusive fabric for our national flag should be restored . This fabric, described by Pandit Jawaharlal Nehru as “the livery of India’s freedom,” must be reinstated as a symbol of our national pride.  Also, the preservation of the handloom industry is crucial not only for economic reasons but also for maintaining our cultural heritage. India’s diverse handloom traditions, such as Chanderi, Muga silk, and Pochampally, are integral to our legacy. To safeguard this sector, it is essential for the government to support MSMEs and exempt GST on handloom products.

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Bamboo, often referred to as the “poor man’s timber,” has emerged as a lucrative crop for farmers, earning it the epithet “green gold.” Its cultivation, when carried out with modern agronomic practices, is proving to be more rewarding than many other crops, including highly lucrative ones like sugarcane and cotton.

Government Initiatives to Promote Bamboo Farming

• Recognizing bamboo’s potential to increase farmers’ income, the government has revamped the National Bamboo Mission and the Mission for Integrated Development of Horticulture. These schemes are being implemented to promote bamboo farming across different parts of the country. 
• The programs include measures to encourage the use of bamboo as an alternative to wood in various sectors and to build a value chain for producing, domestically marketing, and exporting bamboo and its products.
  • For example, in Madhya Pradesh, bamboo-made furniture for government purposes is increasingly being used. 
  • In Assam, everyday products like toothpaste and combs are made from bamboo. In Tripura, small-scale enterprises produce bamboo sticks, which are then sold to larger manufacturing companies. 
  • The government is aiding these small firms by providing subsidies, thereby creating a value chain.
• The government is also recognizing the potential of bamboo for farmers and helping them market their products domestically. 
  • For instance, local artisans can be seen selling bamboo products near metro stations.

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India’s Bamboo Boom: Market Potential, Policy Changes, and Expansion Initiatives

Market Potential

• NITI Aayog has projected the global bamboo market to be worth around $98.3 billion by 2025. 
• India, being the world’s second-largest bamboo producer after China, is striving for a significant share of this booming market. 
• The country boasts as many as 136 well-documented native species of bamboo and produces about 3.23 million tonnes of this highly valuable and versatile plant annually.

Policy Changes

• The cultivation of bamboo as an agricultural crop, rather than just wild produce, was facilitated by the well-advised amendment to the Indian Forest Act in 2017, which reclassified bamboo as “grass” instead of a “tree.” 
• This change freed bamboo from various restrictions related to the harvesting, transportation, and sale of trees and other kinds of forest produce. 
• This move is supported by the botanical classification of plants, which places bamboo in the Poaceae (Gramineae) family of grasses, alongside important food crops like wheat, rice, oats, rye, maize, barley, sorghum, and millets. 
• Bamboo can now be grown like any other crop and marketed without the need for a licence or permission from the forest department or any other government agency.

Expansion Initiatives

• Bamboo farming is rapidly spreading in areas such as Madhya Pradesh, Chhattisgarh, the Andaman and Nicobar Islands, and the Western Ghats, in addition to its natural habitats in the Northeastern region and West Bengal. 
• The land under bamboo cultivation is estimated at over 15.70 million hectares, with the Northeastern zone accounting for about 50 percent of the country’s overall bamboo resources.
• Recent media reports indicate that the number of bamboo farmers has doubled in Gujarat over the past couple of years.
• The Maharashtra government has also announced plans to expand the area under bamboo farming by 10,000 hectares, offering an incentive of ₹7 lakh per hectare. This initiative is part of the state’s strategy to create carbon sinks (carbon dioxide sequestration zones) to contain environmental pollution.

Uses of Bamboo Plant

• Bamboo plants are known for their efficiency in converting carbon dioxide into oxygen. Studies have shown that bamboo produces about 35 percent more oxygen than most other vegetation.
• Bamboo is also among the fastest-growing plants in the world. It can grow between 30 cm and 90 cm (1 to 3 feet) in a single day, making it one of the most efficient producers of biomass. This rapid growth allows bamboo to be used in a variety of ways, from food to fuel.
• In the Northeastern states of India, fresh bamboo shoots are consumed as vegetables or used as ingredients in local dishes. Bamboo-based foods are considered healthy due to their high fibre content and low calorie count. Additionally, bamboo shoots have a unique flavour that is highly valued in culinary preparations.
• Certain parts of the bamboo plant, including its roots, are believed to possess therapeutic properties and are used in traditional healthcare systems in the Northeast.
• Bamboo can also be converted into environmentally friendly biofuels, such as ethanol, or pulped to produce paper. 
• Furthermore, bamboo is widely used in the construction sector as an alternative to wood and for making scaffolding, due to its strength, resilience, and flexibility. Its use in furniture, such as tables, chairs, and beds, is also expanding, thanks to its lightweight, durability, and distinctive natural appearance.

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Harvesting Bamboo

• In commercial plantations, bamboo is typically propagated through cuttings of its culms or rhizomes during the rainy season. The harvested plants regrow, producing a fresh crop. It takes nearly five years for bamboo plants to reach the harvestable stage.
• During the initial two to three years of bamboo plantations, other crops such as turmeric, chilies, and ginger can be grown between the bamboo plants to provide additional income. 
• The average annual yield of bamboo is generally 30-35 tonnes of culms per hectare. Well-managed plantations, using high-yielding varieties, proper cash inputs, and good agronomic practices, can produce even higher outputs.

Note: “Beema Bamboo” is one of the most popular high-yielding varieties developed through biotechnology. With the average price of bamboo at ₹100 per stick, growers can easily achieve a net annual profit of ₹75,000-80,000 per hectare. 

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Understanding the Multifaceted Causes of Rape

• Patriarchy and Gender Inequality: Rape is deeply rooted in patriarchal structures where men are often seen as dominant over women. 
  • For example, in many households, decisions about what to buy, what to have for dinner, etc, are made by men.
    • This inequality perpetuates the idea that women are subordinate and can be controlled or violated. Men begin to see themselves as superior. 
  • The social conditioning of men to assert dominance over women can lead to violent expressions of power, such as rape.

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• Cultural Norms and Misogyny: Misogyny, which refers to the hatred of or prejudice against women, is prevalent in many societies where women are objectified and devalued. 
  • For instance, consider ads for products like washing powder, where only women are shown, or how boys are discouraged from playing with dolls and told to “be a man,” reinforcing the idea that only girls play with dolls creates a prejudice.
  • Cultural norms that promote male superiority, victim-blaming, and the sexualization of women contribute to a mindset that justifies or normalizes sexual violence against women.
  • There are instances where rape victims are trolled for speaking out, with comments like “a clap never happens with a single hand” or “she might have been wearing short dresses, roaming out alone,” which blame the victim instead of addressing the crime.
• Lack of Education and Awareness: Inadequate sex education and a lack of awareness about consent play significant roles in the prevalence of rape.
  • When individuals are not taught about healthy sexual relationships, boundaries, and the importance of mutual consent, they may develop distorted views of sexual behaviour and relationships. 
  • Although schools have started teaching about good touch and bad touch, they should also address other crucial topics, such as asking for consent, understanding that “no means no,” and respecting others’ decisions. 
  • This education should not be limited to girls,boys should also receive proper knowledge on these topics.
• Weak Legal Systems and Impunity: A significant factor in the prevalence of rape is the weakness of the legal system in dealing with sexual crimes. When perpetrators believe they will not face serious consequences, they are more likely to commit such acts.
  • The failure to swiftly prosecute and punish rapists creates a culture of impunity. Therefore, laws must be designed to create a deterrent effect, instilling fear among potential wrongdoers.
• Socioeconomic Factors: Poverty, lack of opportunities, and social instability can also contribute to the occurrence of rape. 
  • In an environments where resources are scarce and survival is uncertain, some individuals may resort to violence, including sexual violence, as a means of asserting control or gaining access to resources.
• Media Representation: The way sexual violence is portrayed in the media can influence societal attitudes towards rape. 
  • For Example: if media portrayals normalize or downplay rape, it can desensitize the public and diminish the perceived severity of the crime.
  • Media can also perpetuate harmful stereotypes about victims and perpetrators, which can affect how rape is understood and addressed in society.

Unfortunately, media debates have degraded, with blame games and fights among politicians taking precedence over educating the masses about this sensitive issue. This must be addressed.

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Conclusion

Rape is never the result of a single factor; it is the outcome of an interplay of many factors. Addressing this issue requires a comprehensive approach that involves changing cultural norms, improving education, strengthening legal systems, and ensuring that media representations are responsible and sensitive.

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