A kind appeal for help

 

Few months back one of my friends met with an accident. He was enjoying a happy life till then (working with a good Hotel). After the accident he was bedridden for a couple of months, lost his job and then eventually he passed away last weekend.

But the real tragedy starts now. He was married against the wishes of both his parents as well as her parents and for that sole reason no one from his side, including his own mother/brother/sister came to see him in his last days or  even the dead body. From the girl’s side, the less said the better. Her parents are happy to see her suffer for going against their wishes. With few neighbors and friends they somehow managed to finish the burial.

The family — his wife and one year old little kid has absolutely no source of income. In fact they were so burdened by the medical expenses that they couldn’t even pay the rent for the last few months. They didn’t even have any groceries in the house. Since I was not in the city (Hyderabad), I asked some of my friends to go there and give some immediate help, which they kindly did. I have also started collecting money from my friends but I don’t know how much I can collect and hence I thought I will use all possible means to approach everyone I know.

Some of my friends have suggested that she may need professional counseling help as she is facing this crisis all alone. We are considering this also. But our priority is to ensure that she has enough financial resources with her for the next few months and we are sure that she will eventually recover and find a job. Luckily she has some prior experience as a teacher in a private school and with some references she may find a job.

If anyone is interesting in supporting this family in any way, please get in touch with me.

Thank you very much.

You can contribute here : https://milaap.org/campaigns/support-a-family

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Small Relatively Absolute Data Analysis.

I have come across a very interested article on Newslaundry titled – “Think India has become more communal under Modi? The numbers will disappoint you.” Given that the blog has been written by an esteemed socio-politico-economic-data analysist and a renowned unbiased journalist, I cannot criticize it. Anyway, how can I criticize any article now, given that I didn’t create a blog and do the same in 1984? I have seen people take big “U-turns” about the political opinions but is it possible to take such “U-turns” with data. I don’t know.

So I just want to understand and learn some of the concepts. Only that much.

If there is one thing that we can trust the State on, it is their passion to duly register an FIR on every communal incident, where the state itself is either complicit or worse the aggressor.  Of course, given that the State we are talking about is UP, there should be no doubts about anyone’s sincerity and we can completely trust the data (registering the FIR and NCRB compilation). Hence, the first few paras of this article are very clear to me.

The problem starts from here.  I have never seen such a discrete information like States joined by “lines” (which normally represent continuity between data points). What does the line joining Chandigarh and Goa indicate? Of course, it is just a technical point, but I want to make sure that I am not missing any grand theory here.

 

CViolennce

image source : newslaundry.com

Thus it was asserted that communal violence increased by nearly 25% in the first five months of 2015 under the Modi government as against the first five months of 2014 during the last days of the UPA. The actual raw numbers are 287 incidents in January-May 2015 as against 232 incidents in the corresponding period 2014.

Leaving aside the fact there’s a relatively small absolute difference between the two numbers and there’s no way to know if the difference is statistically significant

This paragraph is amazing. What exactly is “relatively small absolute difference”? I also want to learn how to calculate such relatively small absolute differences.

There seems to a big dilemma about whether the numbers are “statistically significant”.  The statistics that I had learned (and still learning) seems to suggest that the data is “statistically very significant”. Statistical significance comes into the picture if we are analyzing a small sample and if we want to check if the relationship exhibited by the sample is just because of some sampling or other issues. Why should we bother about “statistical significance” when the data here refers to that of the entire population?

I know that because of 1984 and all that………. But one last question.

To take an extreme case, suppose we compare March 15 across any two years and find that there was one incident last year and two incidents this year on that date. Would we then be entitled to assert a 100% increase in communal violence on that day? Of course, not. 

If there was ONE communal incident last year and if there are TWO communal incidents this year, I would think that there is a 100% increase and I thought that is simple mathematics.  “Of course, not.” I must be very wrong. Like Alzebra there must be some Cow-zebra that will explain why it is “ofcourse not” 100%. Any tutorial on that will be very helpful.

 

 

 

 

 

Opinion Polls: Scientific Basis or Surrogate Campaigning?

What is the mathematical reasoning behind opinion polls in India? Which branch of statistics can give us insights into how vote shares can be converted into seats? For a complex multi-stage sampling process, how are poll agencies coming up with a precise “3% margin of error” estimate?

No one gives us answers to these questions—– because there are no legitimate answers. Psephologists, pollsters, data scientists etc have become the election-babas of India.

Is it surprising then that the opinion polls are manipulated?

According this tweet by Rajdeep Sardesai of CNN-IBN, the same agency did a national poll for different media outlets within a fortnight with different figures.

According to an article by Rukmini Shrinivasan  in Times of India the manipulation of opinion polls(perhaps with good intentions) was never a secret:

No agency wants to admit it but the statistical models that take them from voting preferences to seats include some element of subjectivity. In his early years, CVoter’s Deshmukh candidly admits that he applied his journalistic instincts to the numbers before arriving at a final seats tally. The agency now uses a proprietary algorithm, which he is still continuously fine-tuning , but there remains an element of something intangible. “I won’t call it a qualitative element, but insight gained from the quantitative data over time,” Deshmukh says. “The final figures can be decided by application of some political wisdom, but political wisdom should not dominate over findings collected from voters’ data,” Kumar says. (emphasis mine)

The only way to estimate voter preferences is by collecting a random and representative sample. If that is the case then why would anyone spoil the randomness of data by using their “political wisdom”? Adjusting the sample to demographics is one thing but to blatantly contaminate and manipulate the data under the garb of “political wisdom” or “journalistic instincts” works only in India.

It is not an easy exercise to arrive at seat estimates in a multi-party and representative democratic set up like India and some degree of manipulation is perhaps inevitable.  However, the News Express expose revelation that this manipulation can happen at the behest of some vested interests is very worrying.

Some analysts and journalists are quick to suggest that there should be more transparency in the methodology and the process should be monitored by an independent regulator (like Lokpal??).

No matter how transparent the methodology is, once an agency decides to manipulate the results of an opinion poll they can manipulate the survey data itself and I am not sure how any regulator can prevent this.  The only possible “regulator” for opinion polls is the credibility. If the seat projections of the opinion polls differ from the final results by a significant margin, these agencies should be out of business. However, if you look at the recent Delhi exit polls, C-Voter (Cong-20 and AAP-15), AC Neilsen (Cong-16 and AAP-15), ORG (Cong-20 and AAP-6) are nowhere near the actual results and none of these agencies even bothered to explain the discrepancy. The news channels continue to engage them and there is no incentive to be accurate.

The problem with the manipulation of opinion polls is that it directly interferes with the process of free and fair elections in two ways:

  1. There is something called “bandwagon effect” —- the probability of any individual adopting it[a particular choice] increases with the proportion who have already done so. Yogendra Yadav, based on the surveys of CSDS confirmed that Indian voters tend to back the winning horse. By manipulating the poll results (without any scientific basis) the agencies are creating a false bandwagon effect, thereby giving an edge to a political party.
  2. Election campaigning is regulated by EC with a model code of conduct which gives a level playing field to all the political parties. However, in many states, especially in South India, it is not uncommon for political parties to own news channels and these news channels are becoming centers of surrogate campaigning by repeatedly telecasting the favorable opinion polls.

Both of these are serious issues and while a complete ban on the opinion polls is not a solution, we should be open to the idea of a short blackout period just before the elections.

Also read : My previous post on why opinion polls should not be taken seriously.

Rule by Ordinance

Article 123 of the constitution enables the President to promulgate an ordinance when both of the houses are not in session and it is practically not possible to pass a law. From the text of the article —  “circumstances exist which render it necessary for him to take immediate action” —  it is very clear that the ordinance route should be used only when both the houses are not in session and the costs of delaying a particular legislation are extremely high. The ordinance process is inherently undemocratic and the constituent assembly felt the same. To quote Prof. K. T. Shah:

Most of us, I am sure, view with a certain degree of dislike or distrust the ordinance-making power vested in the Chief Executive. However we may clothe it, however it may necessary, however much it may be justified, it is a negation of the rule of law. That is to say, it is not legislation passed by the normal Legislature, and yet would have the force of law which is undesirable. Even if it may be unavoidable, and more than that, even if it may be justifiable in the hour of the emergency, the very fact that it is an extraordinary or emergency power, that it is a decree or order of the Executive passed without deliberation by the Legislature, should make it clear that it cannot be allowed, and it must not be allowed, to last a minute longer than such extraordinary circumstances would require.

To use such executive veto to give legislative effect to the so called important “anti-graft” bills shows the extent to which this government is prepared to undermine the institutions even in the last few days of its tenure.  If these bills are so important then why they were not passed in the parliament a week ago? And if ordinance route is becoming a norm, then what is the point in having a Parliament?

2G Issue(Policy) Vs 2G Scam

 

The issue of 2G ( as a Policy) and the 2G Scam are two different things, while “not-auctioning” could be a bad policy, the real scam comes from the abuse of the stated policy with criminal intent. While “not-auctioning”† has been demonised by the media, auction in a non-level-playing-field is complex and discriminatory

If you had bought 100 shares of Wipro at the rate of Rs 100 per share in 1980, they would be worth Rs 200 crore (Rs 2 billion) 2007If you had invested Rs 10,000 in Infosys shares in 1992, you would be richer by Rs 1.5 crore (Rs 15 million) in 2007 Details in this link.

If a presumptive loss of 1.76 lakh crore is the “biggest scam of Independent India”, then our spouses have every right to allege that we are part of “second biggest scam of independent India”, for not investing in Infosys and Wipro.  Well, that’s on a lighter note.

The important point one should remember while discussing 2G is that, there is a “2G issue” and a “2G Scam”—Completely two different things. No one can justify the allocation of spectrum in 2008 based on price discovered in 2001, but a bad policy however bad it may be, will not become criminally culpable. So it is very important to separate the policy decision from the actual criminal misconduct. A minister can pick up a bad policy and can implement it without involving in any financial irregularities.

Let us look at the possible ways in which spectrum could be allocated to applicants:

  1. FCFS (first come first serve) at the price of 2001
  2. FCFS but with price indexation or revaluation
  3. Auction under given circumstances
  4. Auction after ensuring a level-playing field

Let us not even try to defend the first choice.

The second one seems more appropriate, it generates more revenue, the valuation considers the changes due to the growth in the sector; it does not disturb the “level playing field”. It is the opinion of the blogger that this is best possible option that DoT should have adopted.

The third option is what everyone in the media is shouting about— The Auction. Let us see if this is a practical possibility.

On 2nd November 2007, PM writes to A.Raja 

In order that spectrum use efficiency gets directly linked with correct pricing of spectrum, consider

    (i)   introduction of a transparent methodology of auction, whenever legally and technically feasible, and

  (ii)  revision of entry fee, which is currently benchmarked on old spectrum auction figures.

On the same day, A.Raja replies back:

The issue of spectrum was considered by TRAI and the Telecom commission and was not recommended as the existing license holders who are already having spectrum upto 10Mhz per circle have got it without any spectrum charge. It will be unfair, discriminatory, arbitrary and capricious to auction the spectrum to new applicants as it will not give them level playing field.

The option of auction is NOT favored not just by DoT but also by TRAI and Telecom commission. This is a legitimate decision. There are already operators in the field and if DoT allocates spectrum based on auction, sure, there will be good revenue for the government but the new applicants will have to compete with their old counterparts after paying a significant license fee as determined by the auction.

It is very important to maximize the revenue while issuing licenses but it is even more important to ensure that the policy sustains and the sector doesn’t collapse. Let us go back to the CAG report of 2000. 

The licensees of cellular mobile and basic telephone services in metros and telecom circles defaulted in making payment of license fee to the government leading to mounting dues. They also did not submit requisite financial bank guarantees as per their contractual obligations. On one side private licensees repeatedly violated the conditions of license agreements on the other government granted concessions after concessions in relaxation of tender conditions decided through open competitive bidding.

….The licensees did not adhere to the prescribed payment schedule as laid down in the license agreements. Scrutiny of records in DoT disclosed that as on 31 May 1999, dues amounting to Rs 3779.45 crore were outstanding on account of license fee against various licensees of cellular and basic services. The circle cellular licensees did not pay license fee on a regular basis from second year onwards (from March 1997). Even the metro cellular operators, who were having much larger size of the market several times higher than their initial projections as discussed in paragraph 14.7.5 of this review, stopped paying license fee regularly from the fourth year onwards.

……DoT was in possession of financial bank guarantees of only Rs 1581.56 crore as against the outstanding license fee of Rs 3779.45 crore against various licensees of basic and cellular services.

The telecom sector was in turmoil—Why did this happen? The conditions were decided through “an open and competitive bidding”, and there were no concerns of level playing too, so why did this situation still occur?—Operators were grossly wrong in their projections.

…..The basic premise on which the above package of concessions for existing licensees was based was that all the existing licensees of cellular and basic telephone services were incurring losses as their projections of demand had gone wrong and therefore, they were not in a position to pay huge license fee dues outstanding against them.

CAG claims that the situation of telecom companies at that time was much better than what they were projecting, but the real situation of Telecom companies was so bad that Government had to go for a “bailout package”.

Apart from the advice of the Attorney General, government used the studies made by Industrial Credit and Investment Corporation of India Limited (ICICI) in June 1998 and by Bureau of Industrial Cost and Prices (BICP) in October 1998 to justify the bailout package and the offer of migration

In the same report, CAG ruthlessly criticizes the then government for giving concessions. CAG instead wanted government to impose penalties for delayed payments instead of bailing them out. Of course, both the scenarios cannot be compared, but the mindset of the CAG at that point was instant revenue loss and the aim of the government is to make sure the sector survives and thrives. Today everyone knows if CAG was correct in 2000 or it was government.

In the present scenario, even TRAI didn’t recommend auction and CAG does a “hyperbolic” interpretation of why DoT should have even ignored TRAI and went ahead with auctioning. It reads:

It is to be noted that the role of TRAI, as per the TRAI Act is primarily to foster competition and to ensure a level playing field in the sector. Generation of revenue for the Government is not within the scope of its mandate and hence not perhaps a basis for framing its recommendations. Thus, while accepting the recommendations of TRAI, protecting the financial interests of the Government should have been an important consideration for the DoT.

 Spectrum is a limited resource and in a bidding process, applicants tend to lose rationality and go for higher bids; No doubt, it generates a lot of instant revenue for the Government, but if the licensee fails to live upto his own initial estimations and unable to compete with the existing operators because of a heavy upfront license fee, then the entire policy is a failure. Well, then CAG will publish another report saying “TRAI and Telecom commission opined against auction, had DoT listened to this, the policy failure wouldn’t have happened”. For CAG, it is heads I win and tails you lose.

To be fair to CAG, had mentioned atleast three times in the report that the loss is presumptive and the models used has assumptions. And perhaps even CAG would have been surprised that media ignored most of other valuable findings in the report and just stick to a hypothetical figure of Rs.1.76lakh crore.

Now the fourth, Auction after a level playing field, an “out-of-the-box-option” of Mr.Pranab Mukerjee in point 17. of his secret note to PM :

This can only be a communist suggestion. Only communists define equality (level playing field) as converting rich to poor instead of the other way round. This idea is no worse. His approach is simple:

Why TRAI did not recommend auction?

Because it destroys level playing field, new entrants after paying high price have to compete with the existing operators who will be at an advantage.

How can you ensure level playing field?

Destroy the advantage the existing licensee has.

How do you do that?

Throw them out of license and let them also participate in bidding.

How is it possible?

Ah! There is a clause which says

The LICENSOR reserves the right to modify at any time the these guidelines and terms and conditions of the LICENCE, if in the opinion of the LICENSOR it is necessary or expedient to do so in public interest or in the interest of the security of the State or for the proper conduct of the telegraphs.   The decision of the LICENSOR shall be final and binding in this regard.

This is such a ridiculous idea; there is no evidence so far that either DoT or TRAI or Telecom commission or DEA even attempted to consider it. If this idea is ever considered, will any operator sign a new license, knowing that, even the new licensee can also be thrown out citing “public interest”? Is this the business environment we hope to create in this country?

The clauses such as the one above, will be included in the license, to keep the licensor at upper hand at all times and to make sure that licensor can change the guidelines, like amount of penalty etc, but to say that this clause should have been used to cancel the licenses of existing operators is just preposterous to say the least and to say that Mr.P.Chidambaram didn’t press for the auction to this extent is even more ridiculous.

Our media is no mood to explain this. Not that they don’t know, —- “Pranab sends a secret note to PM blaming Chidambaram on 2G issue” makes such a great headline that they can’t resist the temptation to misconstrue.

2G Scam :

So if FCFS is just a policy decision and not crime, why is A.Raja in jail. This is the topic (The dirty tricks of A.Raja) which media should have better explained to people, if only they care.

In any First-Come-First-Serve policy, an applicant who has first applied for the service will be provided with the service first. That is the definition. So the allotment of spectrum has to be done based on the date of application filed by the applicant.  Let us look at what A.Raja did :

1.  Spectrum is a limited resource, since FCFS is followed, there is no point in mentioning the cut-off date as there is no restriction in number of operators in a given circle as long as spectrum is available, that was the opinion of TRAI and that is what is mentioned in CAG report. But Mr.Raja goes against this and fixes 01-Oct-2007 as deadline for considering the applications.

2.  DoT arbitrarily decides that the cutoff time will be 25-Sep-2007. (This decision, he informs PM too who could have intervened and stopped, PM expresses concern, asks for auction but doesn’t follow up).

3. (The Magic starts from now) The definition FCFS has been changed. From the receipt of application to date of compliance of LoI (Letter of Intent) .Some of the applicants were waiting for years after filing the application, that doesn’t matter, but who ever brings the deposit fee, bank guarantee and some other required documents will first get the spectrum.

4. Now, according to CBI charge sheet and CAG report, this change to who-ever-complies-with-LoI-First, was leaked to few .

5. The people with whom the information was leaked prepares Bank drafts by November 2007. The change in policy comes out formally through a press release only in 10-Jan-2008.

6. This information is further leaked and through media gradually all applicants were aware of this process are were ready with their bank drafts

7. Now the reader may ask, what will happen if more than one LoI is complied with, on the same date? Wait… There was some Hollywood fiction movie level thought process here.

8. On 07-Jan-2007 a draft of press release was shown to Ld. Solicitor General of India and he approves.

9. A. Raja then deletes the last and a very crucial paragraph from the press release manually and gets an appended one. The last paragraph states that

 If more than applicant complies with LOI condition on the same date, the inter-se seniority would be decided by the date of application
 

10.  Lets fool ourselves by still calling it a FCFS and move further

11.    TO Quote CBI charge sheet “…representatives were required to rush to the reception area of the Sanchar Bhawan at Ground Floor, after receiving the LOIs, for submission of LOI compliance/Entry Fee etc…As a result of the said conspiracy, M/s Swam Telecom Pvt Ltd. was the first to submit compliances for Delhi (where spectrum was limited for one licensee only) and Mumbai circles; and M/s Unitech Wireless (Tamilnadu ) Pvt. Ltd. (representing all 8 Unitech group companies later merged into it) were able to get priority in all circles over many other applicants which applied much before it.”

12.  …”This desperate race to the reception area led to a lot of chaos. Which also resulted in a situation that physical fitness of the representatives became the main deciding factor for priority of submission of compliance of LoIs and entrée fee etc., making a mockery of the first-come-first-served policy”

13. FCFS on basis of application to FCFS on LoI compliance and then to Darwinian Theory of survival the fittest…

14. At this point of time, one would have expected PM to step in and give a legally-permissable-equivalent of a tight slap to the concerned minister and ask him to undo the rubbish. He didn’t. coalition dharma matters more.

15. From CAG Report: 85 Licenses out of the 122 new licenses issued to 13 Companies in 2008 were granted to those companies which did not satisfy the eligibility conditions. They didn’t have paid up capital required at the time of application.

16. From Pages 33 to 45 of CAG report explains all the clauses violated and how undue favors have been given to other companies and read the CBI charge-sheet for more criminal charges levelled.

Aren’t all these irregularities made out of criminal intent and brutally abusing the FCFS policy instead of using it? Shouldn’t PM have stepped in and abruptly called off this entire process and restarted with a more transparent one again. The policy of FCFS could be a bad policy, but couldn’t this have been implemented fairly without doing all the above non-sense?

( All the citations on 2G scam were from CAG Report and CBI Chargesheet)