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By Taponeel Mukherjee
The current discourse on infrastructure focuses on the amount of funding needed for its creation. While the talk about the need for funding is essential, to indeed create more funding for infrastructure, the infrastructure ecosystem itself needs to start focusing more on “revenues”.
“Revenues” here mean the returns the infrastructure assets will generate to compensate the investors for the risk undertaken. Essentially, revenue generating mechanisms and greater clarity amongst investors on the revenue generating mechanisms that will create the cashflows to deliver investment returns are the keys to unlocking funding. In finance parlance, the discussion needs to focus both on the quality and the quantity of the cash flows from the infrastructure assets.
To move towards greater clarity on revenue generation, a clear catalogue needs to be created where all infrastructure assets required are broadly classified under three categories.
The first comprises assets that have a revenue-generating capacity to adequately compensate investors for the risk, e.g., a high-quality airport. Second, assets that have the revenue generating capacity, but need subsidies to provide an adequate return to the investors for the risks involved, e.g., a Metro railway project. The third are assets that have economic benefits but do not themselves generate revenues at all, e.g., a non-toll road asset.
For assets that generate revenues, the emphasis must be on clear contract design that elucidates the revenue waterfall for the asset and on the predictability of the cash flows. It is important to realise that the investors who are looking to invest in Indian infrastructure are mostly managing global portfolios across asset classes. Therefore, Indian assets need to compete with other asset classes from both India and abroad to attract capital. The greater the clarity around revenues and the associated risks, the easier will it be to draw a more substantial quantum of money for infrastructure, and that too at lower costs.
Infrastructure financing through improving “revenue visibility” and “revenue predictability” leads to a virtuous circle whereby greater clarity around revenues leads to both greater quantity and lower cost funding, which in turn helps more viable projects to take off. The “asset monetisation” scheme that has been in talks in recent times will get a significant boost if the focus on “revenues” is built up further.
For assets that require part or full subsidies, the government will need to get greater clarity on what component of the budget will finance the much-needed infrastructure. Across infrastructure sectors such as water, power evacuation and highways, clear demarcation of fund allocation, usage and results will be crucial in delivering the much-needed assets.
It is also important to note that there is significant dispersion in the revenue generating capacity of assets within the same asset class. For instance, certain commercially busy stretches of roadways may lead to lucrative toll-road contracts whereas roads elsewhere might have significant economic benefits such as border roads but might need subsidies from the government for their financial viability.
The ability to implement flexible policies that consider the variability of financial returns from various assets within an asset class will help improve “revenue” generating capacity for infrastructure overall. For instance, given the variability in the wind energy capacity of various sites, India’s wind energy policy needs to account for the fact that highly competitive auctions that may work on the best wind sites may not be conducive to rapid infrastructure creation once the best sites are exhausted.
Additionally, besides the revenue sources, ensuring investors that contracts will be enforced without demur or recourse is essential. In a world with increasing macroeconomic volatility, pricing of revenue streams from infrastructure assets will vary as the various determinants such as the cost of funding, initial capital expenditures and foreign exchange rates vary. Therefore, the better the contract enforcement mechanism, the higher the risk-adjusted revenues from infrastructure projects, thereby greater the investor interest in Indian infrastructure.
Therefore, though much has been written and said about the opportunity and the challenges that Indian infrastructure involves, the next step should be a renewed focus on “revenues” that assets can generate. We must ensure that measures are taken to improve “revenue” visibility, and to provide alternative financing solutions when asset revenues are not sufficient. (IANS)
Everyone loves firecrackers, even the most environment-friendly advocates cannot hide their joy when they see these delightful lights colour the skies. India celebrates Diwali in the true spirit of her culture and heritage by spraying the navy-blue skies with sparkling hues of gold, silver, red, and green. Firecrackers are not just a tradition in this country, they are a legacy.
The original connotation one makes with fireworks in China. The elaborate Chinese celebrations with dragons and zapping firecrackers have left their mark in human memory, but the use of fireworks is not limited to heralding the Chinese New Year. All over the world, fireworks have come to symbolise the ultimate celebration. During Diwali in India, this spirit is re-ignited every year.
Indians have known the use of gunpowder for many centuries now. Sanskrit texts name a substance called 'agnichura' which is described as a 'powder that creates fire'. This is believed to be saltpetre.
A single firecracker ablaze Photo by Unsplash
Sometime during the rule of the Vijayanagar Empire, and the Adil Shah Dynasty in South India, the use of the Chinese pyrotechnic formulae became extensively common in entertaining the royals. Weddings, Festivals, and other special celebrations in the palace were marked with a spectacular display of fireworks.
Between the 1920s and 1940s, the dynamics of fireworks changed in India. Ayya Nadar and Shanmuga Nadar, from Tamil Nadu's Sivakasi who migrated to Kolkata, set up a fireworks factory there. It began as a match factory, but after receiving the required permission, it was converted into a fireworks unit. Within a few years, another factory was set up in Sivakasi. Before long, multiple units were set up there, and today, it is India's fireworks hub. Most of the crackers that are used during Diwali come from Sivakasi.
Recently, environmental concerns have caused the ban of fireworks as it causes air pollution. The sale of crackers has reduced drastically after this new law. During the lockdown, the factory labourers underwent great losses, especially in Sivakasi. But keeping the spirit of Diwali in mind. crackers cannot be entirely done away with, and continue to light up the skies at least for a few hours every year.
Keywords: Diwali festival, Fireworks, Sivakasi, the Vijayanagar Empire, culture and heritage in India.
PARIS — In a decision with potential ramifications across European museums, France is displaying 26 looted colonial-era artifacts for one last time before returning them home to Benin.
The wooden anthropomorphic statues, royal thrones and sacred altars were pilfered by the French army in the 19th century from Western Africa.
President Emmanuel Macron suggested that France now needed to right the wrongs of the past, making a landmark speech in 2017 in which he said he can no longer accept "that a large part of many African countries' cultural heritage lies in France." It laid down a roadmap for the controversial return of the royal treasures taken during the era of empire and colony. The French will have a final glimpse of the objects in the Musée du Quai Branly–Jacques Chirac from 26-31 October.
French Culture Minister Roselyne Bachelot tried to assuage jitters among European museums, emphasizing that this initiative "will not create a legal precedent."
A royal seat of the 'Royal treasures of Abomey kingdom' (Œuvres des tresors royaux d'Abomey) on display at the Musee du quai Branly in Paris, Sept. 10, 2021. Photo Credit: VOA
A French law was passed last year to allow the restitution of the statues to the Republic of Benin, as well as a storied sword to the Army Museum in Senegal.
But she said that the French government's law was intentionally specific in applying solely to the 27 artifacts. "[It] does not establish any general right to restitution" and "in no way calls into question" the right of French museums to hold on to their heritage.
Yet critics of such moves — including London's British Museum that is in a decades-long tug-of-war with the Greek government over a restitution of the Elgin Marbles — argue that it will open the floodgates to emptying Western museums of their collections. Many are made up of objects acquired, or stolen, during colonial times. French museums alone hold at least 90,000 artifacts from sub-Saharan Africa.
A woman looks at the Parthenon Marbles, a collection of stone objects, inscriptions and sculptures. Photo Credit: VOA
The story of the "Abomey Treasures" is as dramatic as their sculpted forms. In November 1892, Colonel Alfred Dodds led a pilfering French expeditionary force into the Kingdom of Danhomè located in the south of present-day Benin. The colonizing troops broke into the Abomey Palace, home of King Behanzin, seizing as they did many royal objects including the 26 artifacts that Dodds donated to the Musée d'Ethnographie du Trocadéro in Paris in the 1890s. Since 2003, the objects have been housed at the Musée du quai Branly–Jacques Chirac.
One hundred and twenty-nine years later, their far-flung journey abroad will finally end.
Benin's Culture Minister Jean-Michel Abimbola called the return of the works, a "historic milestone," and the beginning of further cooperation between the two countries, during a news conference last week. The country is founding a museum in Abomey to house the treasures that will be partly funded by the French government. The French Development Agency will give some 35 million euros toward the "Museum of the Saga of the Amazonians and the Dan home Kings" under a pledge signed this year.
The official transfer of the 26 pieces is expected to be signed in Paris on Nov. 9 in the presence of Macron and the art is expected to be in Benin a few days later, Abimbola said.
While locals say the decision is overdue, what's important is that the art will be returned.
"It was a vacuum created among Benin's historical treasures, which is gradually being reconstituted," said Fortune Sossa, President of the African Cultural Journalists Network. (VOA/RN)
Keywords: Benin art, Emmanuel Macron, European museums, Abomey Treasures, anthropomorphic statues
GENEVA — The battle to stem climate change may be lost as new information indicates the Amazon rain forest is turning from a carbon sink – or area that absorbs CO2 – into a source of carbon dioxide, the World Meteorological Organization warns.
The latest edition of the WMO's Greenhouse Gas Bulletin reports emissions of carbon dioxide, methane, and nitrous oxide once again broke all records last year.
The U.N. agency's report warns the concentrations of these greenhouse gas emissions into the atmosphere are driving climate change. It says carbon dioxide, the single most important greenhouse gas, accounts for approximately 66 percent of the warming effect on the climate.
The secretary-general of the World Meteorological Organization, Petteri Taalas, says about half of CO2 emissions remain in the atmosphere for centuries. He says the other half is taken up by oceans and land ecosystems.
He says it is not clear for how much longer forested areas, often referred to as the lungs of the Earth, will continue to act as effective carbon sinks.
"We have already seen some alarming indications that, for example, Amazonian rain forest ecosystem, which used to be a major sink of carbon, has become now a source of carbon, which is alarming," Taalas said. "And this is related to deforestation in the area and also changes in local climate because of this deforestation."
Oksana Tarasova, who heads the WMO's Atmospheric and Environment Research Division, says the WMO only now is revealing this new finding because it has taken nine years of observation to gather the measurement data set needed to understand the changes taking place. She says not all of the Amazon forests are turning from a carbon sink to a net producer of carbon.
"So, the Western part of the Amazonia still continues to work as a carbon sink at this point. But we do not know for how long that will continue this way," Tarasova said. "We are making the measurements there and keeping our track of what is happening there. … I would take the whole Amazonia as a whole that is seen that it is a sink, but its capacity is substantially reduced."
Meteorologists say climate change negotiators at an upcoming conference in Scotland must take concrete action and make concrete pledges to reduce carbon dioxide emissions.
They say setting carbon-neutral targets will not work in stemming climate change. They also warn the world is heading toward a temperature rise of 2.5 degrees Celsius by the end of this century. This, they say, is far more than the Paris Agreement target of 1.5 to two degrees Celsius above pre-industrial levels. (VOA/RN)
Keywords: Climate change, amazon rain forest, UN Agency Warns, World Meteorological Organization, greenhouse gas emissions.
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