Thursday, January 17, 2008

On Environmentalism, Global Warming, and the Tata Nano


A few days ago, we were witness to a a spectacular event - the unveiling by Tata Motors of the world’s cheapest car ever, the Nano, which has a base price of just Rs. one lakh (Rs.100,000 or US$2,500). When, amidst unprecedented hype and anticipation, the “people’s car” was unveiled, it exceeded all expectations. What we saw was the cutest little car ever, with room for four adults, and with adequate power for Indian city roads.


What the Nano Means for India

The Indian middle class has already fallen in love with the Nano. Some two hundred thousand people thronged the Auto Expo in New Delhi to get their first glimpse of the car (link). And no wonder! According to the rating agency CRISIL, “the new price point translates into a 65% increase in the number of Indian families that can afford a car” (link).

Millions of Indians look to the Nano to fulfil their dreams of car ownership, and most importantly, to provide safe transportation. In Delhi alone about 1,800 people die on on the roads each year - about one-third of them on two-wheelers, while only 5% die in cars (link). In Mumbai more than 3,000 die every year in the city’s dangerously overcrowded commuter rail system alone (link). While unveiling the Nano, the chairman of Tata Motors, Ratan Tata, explained the motivation for developing this car, “I observed families riding on two-wheelers – the father driving the scooter, his young kid standing in front of him, his wife seated behind him holding a little baby. It led me to wonder whether one could conceive of a safe, affordable, all-weather form of transport for such a family.”


The World Takes Note

One of the most remarkable aspects of the Tata Nano has been the very high level of prominence it has received in the world media. This is possibly the first time ever that an Indian product developed by an Indian company has been seen as a worldwide leader in innovation and technology. (see for examples, the New York Times, Businessweek, the Economist, ABC News).

Typical was an article entitled “Can Detroit be Relevant?” in the New York Times, which said,
This week, Rick Wagoner, chief executive of General Motors, was at the Consumer Electronics Show in Las Vegas talking about driverless cars and the Cadillac Provoq, a concept vehicle powered by a fuel cell. But bigger news came half a world away, at the New Delhi Auto Expo in India. Tata Motors was unveiling the Nano. Nicknamed the People’s Car, the Nano is a small $2,500 car that is expected to revolutionize the auto industry, in India, at least (link).

An Article in a British newspaper actually speculated on the possibility of the Tata Nano ushering in world peace,
Perhaps the idea of the car industry succeeding in bringing peace and prosperity to parts of the developing world where countless governments and other institutions have failed is just too fanciful, but if it ever happens, just remember that it all started with the little Indian (link).

The Detractors

While the Tata Nano has already become India’s pride and joy, and is seen as a world leader in technology and innovation, it does have its share of detractors.

Land Acquisition for the Manufacturing Plant

When Tata Motors was looking for a site to locate a new manufacturing plant for its small car, the state government of West Bengal government successfully persuaded Tata to choose Singur, near Kolkata, as their site. In order to make space for the plant, the West Bengal government had to acquire land from farmers in Singur - a small part of it forcibly. This land acquisition has now snowballed into a major controversy.

While I realize that the West Bengal government could perhaps have done a better job in dealing with the land acquisition at the local level, I fully support their basic idea of turning Singur into an industrial area. It is clear that compared to agriculture, the auto industry in Singur will generate a much higher volume of economic activity, and will also create many more man-days of gainful employment - employment that is likely to be much better in terms of pay, benefits, etc. I do believe that generous compensation should be provided to those who have lost their land, and help and training should be provided as well, to enable them to adjust to their new lives and take advantage of the new economic opportunities that open up.


The Tata Nano and Oil Prices

Some commentators have criticized the Tata Nano on the grounds that widespread car ownership in India will push up the worldwide price of oil (link). This is really an absurd argument. After all, don’t people in India have the right to buy petroleum products (or in economic terms, “create demand” for oil), just as people in the United States or Europe do? It is like criticizing ordinary middle-class families for buying homes and driving up land prices, thereby making it more difficult for the rich to buy their mansions.

It is true that demand for oil has been rising because of economic growth in China, India, etc. However, it is important to note that this is not the only factor driving up the price of oil. The increase in the price of oil has been disproportionately larger than the growth in demand. Today, the price of oil is far far higher than the economic cost of its extraction. The main reason for this is the monopolization of the crude oil market by a cartel of sellers – the Organization of Petroleum Exporting Countries (OPEC). It is well known that when monopolies exist, markets cease to function effectively. That is why most countries have anti-monopoly laws. Unfortunately, no such laws exist for sovereign states. As a consequence, OPEC has been able to indulge in the worst kind of price gouging. In order to counter OPEC’s monopoly, I feel that oil importing countries should organize themselves into a buyers’ cartel. The combined buying power of an anti-OPEC buyers’ cartel should be used to bargain effectively with OPEC and drive down the price of oil, much like what Wal-Mart does with its suppliers.


Opposition by Environmentalists

Some environmentalists have severely criticized the Tata Nano, for its perceived negative impact on the environment. One of the most prominent of these is Sunita Narain of the Center for Science and Environment (CSE), who has called for the Tata Nano to be “taxed like crazy”. Another prominent environmentalist, Dr. Rajendra Pachauri, who chairs the Intergovernmental Panel on Climate Change (which won the 2007 Nobel Peace Prize, along with Al Gore) remarked that he is “having nightmares” about the Tata Nano.

I think these environmentalists have got it completely wrong.


The Tata Nano and Mass Transit

Some have put forward the argument that instead of small cars, Indians should concentrate on mass transit. I agree that India should indeed invest heavily in mass transit. However, I do not think that this calls for severe curbs (“tax it like crazy”) on the auto industry. This is not a zero-sum game. This is not an “either-or” situation.

Among Indian cities, Delhi has a much more extensive mass transit system than, say, Kolkata. But Delhi also has a higher rate of car ownership than Kolkata. In reality, car ownership is much more closely tied to peoples’ incomes than to the presence or absence of mass transit.

A few months ago I was in France on vacation. I was most impressed with the excellent public transport system there. However, in spite of an impressive mass transit system, car ownership in France is high - almost 500 cars for every 1000 people (India has 7 cars for every 1000 people) (link, link). Car ownership in France is high, not because the mass transit system there is bad, but simply because peoples’ incomes are high.

Had widespread car ownership spelt doom for public transportation (i.e., buses), the introduction of the Tata Nano would surely have been bad news for Indian bus manufacturers. But guess who is India’s largest bus and truck manufacturer? Tata Motors itself! It does not appear that Tata Motors is the slightest bit concerned that sales of the Nano will cannibalize its bus sales, even though Tata’s profit margin on buses is probably larger than it’s going to be on the Nano. Clearly this is not a zero-sum game. The automobile industry in India is not fundamentally opposed to the idea of mass transit. On the contrary, a healthy and growing economy, of which the auto industry forms an important component, is necessary to pay for large mass transit projects.


The Tata Nano and Global Warming

Some environmentalists have denounced the Tata Nano on the grounds that widespread car ownership in India will worsen global warming. While I do recognize the necessity of dealing with global warming, I feel that the environmentalists’ whole approach to dealing with this issue is fundamentally flawed.

Many environmentalists take the view that human civilization and development have been unmitigated disasters for the planet. In this view, human activities such as economic development, industrialization, consumerism, car-ownership, etc., have been guilty of destroying the environment and causing global warming. Supposedly the only way out is to curb these human activities and abandon our vain attempts to achieve progress and “growth”. In this view, an ideal society is one that is based on limited ambition, limited needs and subsistence production.

Based on the core idea that human activities are inherently bad for the planet, the solutions that environmentalists propose generally involve imposition of limits, quotas, punitive taxes, restrictions, etc., with the aim of curbing human activities and human initiative.


The Problem With the Limits and Quotas Approach

Limits and quotas can certainly lead to some modest incremental reductions in energy consumption. However, to address major environmental problems such as global warming, it is necessary to achieve not just modest reductions, but fundamental paradigm-changing shifts in energy usage. In other words, key breakthroughs in energy technology are needed. It is extremely unlikely that such key breakthroughs can ever be achieved through the limits-and-quotas approach. Consider the following.
  • None of the key breakthroughs in computer technology can be attributed to the effect of quotas or limits. As authors Ted Nordhaus and Michael Shellenberger point out, it is highly unlikely that simply introducing restrictive quotas for typewriters would have instigated critical breakthroughs in computer technology. Rather, public investment in science and technology research played a huge role in ushering in the computer age – by nurturing once fledgling technologies such as the silicon chip, the internet, etc.
  • One of the greatest achievements of the twentieth century was the Green Revolution, a paradigm-changing transformation of agriculture in countries like India. It dramatically increased food production, thereby avoiding the Malthusian catastrophe of a global “gigantic inevitable famine” caused by population growth outstripping food supply. During the Green Revolution new high yielding varieties (HYV) of seeds were developed, and technologies and infrastructure such as pesticides, fertilizers, and irrigation systems were made available to farmers. Just like the Computer Revolution, it was not primarily the introduction of quotas and limits (say food quotas), but rather, large public investments and human ingenuity that made the Green Revolution possible.
What many environmentalists do not seem to understand is that fundamental environmental problems like global warming cannot be solved simply by imposing limits and restrictions. If problems like global warming are ever to be solved, they will be solved by human ingenuity, by technological innovation, by further human progress. The idea that the environment can be saved by severely curbing human ingenuity and human initiative is, I believe, fundamentally flawed.

At its core, the world-view held by many environmentalists is deeply conservative. They wish to conserve - to preserve - the world as it was before large scale human intervention in nature. Human society too, they argue, should revert back to the way it was before modern development and industrialization. People are urged to preserve traditional hereditary occupations and traditional means of organizing society. In their view, farmers (and farmers’ children too) should forever remain farmers and never seek better paying industrial jobs. Moreover, farmers are urged to shun modern technologies such as genetically modified seeds, irrigation canals, chemical fertilizers, mechanization, etc., in favor of traditional technologies and subsistence agriculture. In this view, the millions of poor in India should always maintain their traditional way of life, and should always be satisfied with whatever standard of living is achievable through their traditional occupations and traditional technologies. They should never even aspire to possess consumer goods like cell phones, cars, etc. As writer and activist Arundhati Roy puts it, “the idea of turning one billion people into consumers is terrifying... are you going to starve to death dreaming of a mobile phone or are you going to have control of the resources that are available to you and have been for generations....?” (link)

I completely reject this conservative environmentalist world-view. My world-view is a progressive one. I believe that while we should seek to mitigate the negative side-effects of development such as environmental over-exploitation and global warming, the emphasis must be on moving forward, on further human progress. Human civilization and development have been wonderful. People today live longer, fuller, lives, with more prosperity, freedom, opportunity, and choice, than ever before. How can this be a bad thing? The world needs more progress and development, not less.


How to Solve Global Warming

The way I see it, the solution to global warming lies not in restricting, but rather, in encouraging human ingenuity and human initiative to develop new innovative clean energy technologies. For example, Tata Motors, the maker of the Tata Nano, is also investing in clean energy technologies such as cars running on compressed air (link) and cars powered by hydrogen fuel cells (link). Unfortunately, while environmentalists are very vocal in criticizing of the Nano, they fall completely silent when it comes to praising Tata Motors for its clean energy efforts.

While it is important that private companies invest in clean energy technologies, these may not be enough. In order to solve the problem of global warming, it is necessary to develop fundamental paradigm-changing new energy technologies. It is not enough to just depend on free market mechanisms and private companies for this. While free markets and private enterprises work well to incrementally refine technology, giving birth to revolutionary new technologies may not be possible without large public investments. In my view, any program to deal with global warming must have, as its central component, large-scale public investment for research into new innovative clean energy technologies.

At its core, our approach to dealing with global warming must articulate a positive vision that people can embrace, not just a nightmare that people need to be scared of. As authors Ted Nordhaus and Michael Shellenberger point out, the great American Civil Rights leader, Rev. Martin Luther King, Jr., is remembered not for his “I have a Nightmare” speech, but for his “I have a Dream” speech.

Imagine if, instead of criticizing the Tata Nano as a “nightmare”, Dr. Pachauri, the eminent environmentalist, had said something like this: “I have a dream that one day every Indian family will be able to afford a car that runs on clean energy. This can never happen by making cars prohibitively expensive through high taxes, but this dream can become a reality if technological innovations make clean energy affordable to all. I call upon the United Nations to fund a massive international effort to develop new affordable clean energy technologies”.

Now, that would have been a vision I’d have loved to embrace. Dreams, Dr. Pachauri, are more powerful than nightmares!


[Added Later] I have written another article on the Tata Nano that can be found here. This article, for a slightly different audience, is for the Breakthrough Institute Blog. Founded by Michael Shellenberger and Ted Nordhaus, the Breakthrough Institute is a progressive think tank focusing on environmental issues.



References

Some of the ideas on environmentalism expressed here have been inspired by reading the book “Breakthrough” by Ted Nordhaus and Michael Shellenberger, and attending their talk at Berkeley, California. For more about the book, click here. A recording of the talk is available here.

19 Comments:

Blogger Siddhartha Shome said...

Ckick here here for some some wonderful cartoons on the Tata Nano.

January 18, 2008 4:06 PM  
Anonymous Ruhi said...

Hi Siddhartha,

Thanks for the link to my blog. :)

January 19, 2008 6:31 PM  
Blogger Siddhartha Shome said...

Thanks, Ruhi, for those wonderful cartoons!!

January 19, 2008 11:02 PM  
Anonymous Anonymous said...

this was a fantastic post on your part. its such an orwellian nightmare when the worst oppressors of the poor (politicians like mayawati and gang) and the worst polluters (armchair, jet set environmentalists) speak in the name of the poor and environment.

here's to the nano being a great success and setting the stage for a future electric car.

oh and here's to people like you calling a spade a spade and pointing out all the duplicitous doublespeak doing the rounds these days!

January 20, 2008 7:20 PM  
Blogger Barun said...

Hi,
Enjoyed your comments on the Nano. Particularly, the point that increased consumption, rather than restricting it, would trigger human ingenuity to make our consumption more efficient, and consequently also imrpove our environment.
You may also like to see my comments on Tata Nano: Small car with a big vition, stained by Singur, at
http://www.indefenceofliberty.org/story.asp?storyId=866

Barun

January 21, 2008 9:56 PM  
Blogger Siddhartha Shome said...

Dear Mr. Barun Mitra,

Thank you for your comment. And thank you very much indeed for reading my essay.

I enjoyed reading your essay "Tata Nano: Small car, big vision, stained by Singur". I also ended up reading a number of your very interesting essays at the Liberty Institute web-site.

Regards,

Sid

January 22, 2008 11:15 AM  
Blogger vidhya said...

Hi Siddharth

A good post. I was also one of the happiest person to see that Ratan Tata had really kept his promise. But what worries me most is the traffic congestion that will happen in many cities in india. Tata NaNO will definetly increase the rate of accidents in the cities. We need to mantain better roads and learn to follow and respect the traffic rules if we would like to enjoy and tke full advantage of the TATA Nano

January 23, 2008 1:12 AM  
Blogger Bombay Addict said...

Hi Sid - I think this is one of the most comprehensive posts on the Nano. Thanks for this effort. I agree with a lot that you have to say, except on the mass transit aspect.

Indeed it's not an either-or situation. Governments have to invest in mass transit and this simply not being done in Indian cities at all. This stands true with or without the Nano. Period.

However, traffic and congestion are realities for our cities and the rate at which cars are being added clearly paints a grim picture for the future. Add the Nano to this and you have a problem. Obivously, one can't fault Mr. Tata for this. He has produced a car in a free economy. Period.

Also there are a couple of things,
(a) You can't keep building more roads to accomodate more cars. As India's own National Urban Transport Policy points out, a mobility plan should favour transport of people, rather than vehicles.
(b) Car costs in India do not reflect true social cost of ownership (parking, etc.) at all.
(c) Safety standards in India are nowhere near global standards (also relevant from the point of view of accidents); think anti-lock brakes, mandatory scrapping of cars after certain age, etc. Were these to be implemented for all cars, cost of production of cars in India would change and cars would become expensive.

While there is no doubt that one should laud Mr. Tata for his achievement, one should also be mindful of the impact of the car on urban mobility. There are simply too many issues - indeed as you have so diligently outlined yourself - which have to be considered before labeling anyone expressing concern on this car as anti-development.
I agree with Ms. Narain and her arguments. Please don't focus on one-lines "tax like crazy". Instead I request you to read the transcript of her interview with Karan Thapar. Not only does she make a compelling case, she also talks about the need for a comprehensive transition. If she's being seen as anti-Nano for those views, I think I'm anti-Nano too.

I'm sorry for this long-winded comment! I've been wanting to post on this on my blog but I've just not got the time. Besides I wish I could be as articulate as you.

January 26, 2008 6:50 AM  
Blogger Siddhartha Shome said...

Hi Bombay Addict, thank you very much for your incredibly generous compliments. And thank you for your observations and also for pointing to Ms. Sunita Narain's interview with Karan Thapar. Here are some responses.

1. I agree with you and also with Ms. Narain that it is important to encourage public transport. Where we disagree is that Ms. Narain wants govt. support for public transport to be accompanied by severe curbs and restrictions on cars, while I feel that both should be encouraged simultaneously. There are some inherent problems with public transport, especially "last mile" issues. So even if most people go to office by bus/train, every family will likely want to have access to some kind of personal transport - car, scooter, taxi, autorickshaw, etc. This is likely to be even truer for smaller cities, mofussil areas, etc. For e.g., unlike Delhi/Mumbai, what are the chances that smaller cities like Kolhapur, Bilaspur, etc. will ever very extensive public transport systems?

2. I am skeptical of the claim made by Ms. Narain that car owners do not pay their full share of costs, and the govt. is somehow subsidizing them. In India when someone buys a car, various taxes increase the price by approximately 50%. When someone buys petrol, about 60% goes into taxes, and a buyer of diesel pays about 40% taxes. I would think that car-travelers actually generate substantial tax revenue, rather than being subsidized by the govt. And of course, this is how it should be – the auto industry should be an economic engine, generating economic growth as well as tax revenue – revenue that can be used for public purposes such as building public transport systems. I agree with you that there are some issues like parking in cities, etc. The issue is more one of fairness. Surely someone who parks a car in Nariman Point in South Mumbai should pay more for parking than a resident of Kolhapur. The Kolhapur car-owner can be considered to be subsidizing the South Mumbai car owner thru his car taxes. But, on the whole, it appears that the auto industry raises more taxes, then what the govt spends on it. (references, here, here, here).

3. Certainly there are tiny bits of India, where roads cannot be built. For e.g., it may not be advisable to build new roads in, say, Old Delhi. But elsewhere, especially outside of the city-centers of the Metros, there is surely scope for building many more roads, and improving and expanding the existing ones.

4. I think your concerns about safety are misplaced. The appropriate yardstick for comparing the Nano's safety features should be the other transportation options that potential Nano customers have, i.e, scooters, motorcycles, cars like the Maruti 800, etc. In India transportation safety is shockingly poor. Some 25,000 two-wheeler riders die in accidents every year. An astonishing 3,500 travelers die every year in the dangerously overcrowded Mumbai Subarban Rail System alone (see here). In this situation, the Nano is actually likely to enhance transportation safety in a small way. Comparing the safety features of a Nano to a Mercedes is a false comparison.

5. In the interview, Ms. Narain called upon Tata Motors to develop cheaper buses. I agree with her on this. Surely the way forward is thru technological innovation. Tata Motors should build not only cheaper cars and buses, but also build electric cars, hybrid vehicles, etc. I am happy to note that there are efforts in this direction. Ms. Narain will also be happy to learn that Tata does indeed build some of the cheapest buses in the world. Tata’s newly launched Magic minibus, priced at about Rs.2.5 lakh, is extremely affordable and promises to improve rural transportation in India.

January 27, 2008 1:44 AM  
Blogger Barun said...

Automobiles are not just a means of transportation. Mobility is a powerful way to enhance personal autonomy, as well as tool for political and economic empowerment. A very good perspective is provided by the American philosopher Loren Lomasky.
Autonomy and Automobility (1995)
http://www.cei.org/pdf/1437.pdf

You may also like to read John Tierney's article "The Autonomist Manifesto" in the NYT in 2004
http://www.nytimes.com/2004/09/26/magazine/26HIGHWAY.html?_r=1&pagewanted=print&oref=slogin

I would like to point out that congestion on the road is not just a function of the number of vehicles. A crowded market would be generally be considered a success. A few hundred dancers synchronising their movements on stage in a ballet, would be appreciated by the audience.

Finally, I would like you to consider that only when more people can access personal transportation would there be real competition among automobile manufacturers, to innovate. At the same time a larger section of the voters with personal transport would be a much more effective as voters to influence the decision makers to figure out ways of improving roads and transportation.

Thanks,
Barun

January 27, 2008 2:33 AM  
Blogger Siddhartha Shome said...

Barun, thank you very much for your comment. I agree with you completely. Thank you also for those links - very illuminating indeed.

January 29, 2008 9:37 AM  
Anonymous Anonymous said...

[Note: I had also published this essay at desicritics.org, where it generated some interesting comments. Here is one particularly relevant comment (original here), followed by my response. Sid]

Forgive a few criticims here. I'm glad you're writing about these subjects. You're certainly entitled to your opinions, and opinions they are, with no facts to back them up. You would have us gamble our future on the hope that technology can find a way for humans to pepetually expand our population and consumption on a finite planet. Logic alone would dictate we will (or already have) hit the limit.

I confess I'm a little perturbed at your myopic notion that the people of Singur will be better off richer from industrial activity rather than better off having a secure food supply nearby. You can't eat money, and we'll all need a lot more money to trade for food as the price and scarcity of oil cause the cost of transporting food to soar.

Lastly, you put a lot of words in the mouths of environmentalists, and I would just ask your reader to check out for him or herself what environmentalists propose. There is a wide range of environmental viewpoints, including the concept of voluntarily walking more lightly on the planet, and possibly being a lot happier once we are off the treadmill!

Best,

Dave Gardner
Producer/Director
Hooked on Growth: Our Misguided Quest for Prosperity
www.growthbusters.com

January 29, 2008 9:51 AM  
Blogger Siddhartha Shome said...

[Note: This comment originally appeared here]

Hi Dave,

Thank you for your comment. And thank you very much indeed for reading my article.

I disagree completely with your statement that "logic alone would dictate that we will hit the limit" in terms of population and consumption. Yes, maybe logic will dictate that we will "hit the limit" IF, AND ONLY IF, one make the very major assumption that current technology will continue to be used in the future and there will not be any advancements in energy technology. My contention is that this huge assumption that you are making is a false one.

Consider an example from history. In 1798, a British economist named Thomas Robert Malthus published an influential essay entitled "An Essay on the Principle of Population", in which he noted the trend of population growth in Europe, and concluded that the supply of food would not be able to keep up with the growing population. He predicted that severe famine would sweep through Europe, and would reduce the population. However, Malthus' prediction turned out to be wrong. The population of Europe and the world is now many times larger than what it was in 1798, and for most of the world, famine is now happily something that existed only in the distant past. Where did Malthus go wrong? Actually it was not his sheer logic that was wrong. Based on the agricultural practices in Europe in 1798, his prediction of famine was logical. But Malthus was wrong because he made one major assumption that turned out to be false: he assumed that the agricultural technology of the day would continue to be used in the future, and there would not be any advancements in food production technology. In reality, huge advances in agriculture technology have been made since 1798, which have been able to produce food for a much larger human population today.

There are many other examples where logical predictions have been made, which have turned out to false because of technological and/or societal changes. Just to give one more example, this time a trivial one, one could not have predicted logically, in say 1850, that one day millions of people would be flying across the world every day in safety and comfort(?), since aircraft technology did not exist then.

This is not to say that there is no place for logical predictions. Of course logical predictions are very useful. But one must not discount human creativity and human ingenuity and the tendency of human beings to find solutions to problems.

Regarding industrialization, what I think is that most important is that opportunity and choice are always good. Ideally the farmers (in Singur or anywhere else), should have well-paying industrial jobs available that they can get if they want to. The important thing is to have choice available, which means having ample employment opportunities available. An individual should be able to choose for himself if he want to be a farmer, or an industrial worker, or work in a store, or whatever. A person should not be forced to remain a farmer simply because he has no choice and there are no industrial jobs available for him. Any move to create more job opportunities is good.

I also don't agree with you that "you can't eat money", so its better to grow your own food. I would certainly prefer to have money than to grow my own food - at least I can buy food with the money. If my crops fail, I will be able to buy food from somewhere. Subsistence agriculture is certainly not a very attractive career option for most people. Even your opinion that subsistence agriculture will mean a "secure food supply nearby" is highly questionable. In India, most people were engaged in subsistence agriculture for most of history. But for most of Indian history, famine was a constant threat, sometime decimating entire populations. There is even evidence of cannibalism being practiced in times of severe famines in India hundreds of years ago. Subsistence agriculture can hardly be termed a "secure food supply".

Regards,

Sid

January 29, 2008 9:58 AM  
Blogger Bombay Addict said...

Hi Sid - Thanks very much for that generous reply. It is rare to find patience in replies nowadays. A couple of closing points, because I'm broadly in agreement with what you say.

On 1. The last mile is indeed an issue, but I doubt the best of public transport networks could provide last mile coverage. My only fear is I doubt Nano owners would use the car for covering the last mile. I mean, if I have the luxury of a car why should I use public transport at all? Yet, I don't think the choice would be as binary as that. For e.g. in Mumbai, a group of residents of a colony switched from cars to buses because they were very satisfied with the new KingLong buses introduced by the BEST, and obviously quite frustrated with traffic in Mumbai. That's a victory for public transport!

On 2. I'm not sure the gap for cars is as high as 50%. If I recall correctly, Maruti's chief, Mr. Khattar had made that argument in 2002 (i.e. that 50% of the cost of the car goes as taxes) and since then excise duties have halved (from 32% to 16%), at least for small cars. My knowledge here is weak so I wouldn't want to add anything further.

On 3. Spot on

On 4. Of course one can't compare the safety features on the Nano to the Mercedes. And indeed a car is safer than a bike. I guess it's a moot point on what safety standards should be implemented in India, for example, wouldn't the Nano be safer with ABS and airbags? But these aren't mandatory per India's safety standards. My larger concern is that car safety becomes a larger issue given the rising rash driving culture (again a function of over-burdened RTOs doling out licenses without proper tests, lack of an organised training schools) that we're already witnessing in cities. But this obviously applies to all cars, not just the Nano.

On 5. Spot on again.

Thanks very much.
BA

January 29, 2008 9:40 PM  
Blogger Siddhartha Shome said...

I have written another article on the Tata Nano that can be found here. This article is for the Breakthrough Institute Blog. Founded by Michael Shellenberger and Ted Nordhaus, the Breakthrough Institute is a progressive think tank focusing on environmental issues.

January 31, 2008 9:43 PM  
Anonymous Tata Nano said...

Nano is going to be one of the best cars in history. In a few years, we will all we driving electric nanos. I also made a site for nano, if anyone is interested, tatanano.org

April 13, 2009 10:39 AM  
Anonymous Leonard Okoth said...

Sometimesyou must be similar in character will have suffering enough from the stern still ploughing and foaming through the press, take things calmly. I liked reading this. I bookmark your blog. Keep up the good work. I am sure you will get some thumbs up :) & give your valuable feedback on http://limosbusesjets.com

February 01, 2010 3:22 AM  
Blogger Jon snow said...

This comment has been removed by the author.

December 29, 2012 2:36 AM  
Blogger Ruchika Singh said...

Hey Siddhartha
Thanks for this effort. I agree with a lot that you have to say. I just have one added question. Is government intervention efficient in the environment? I am hoping you can give me arguments in favor to this highly debatable topic.

September 09, 2015 2:22 PM  

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