Supporting to Strengthen the Office of the Comptroller and Auditor General

 

An independent and a well functioning Supreme Audit Institution is essential for public financial management system to ensure accountability and good governance. The Constitution of Bangladesh established the Office of the Comptroller and Auditor General (OCAG) as the Supreme Audit Institution. The Government of Bangladesh (GoB) and development partners have reviewed the performance of OCAG and found that there is a substantial continuing need for assistance to improve operations to international standards.

The preparation for the proposed Grant funded project “Strengthening Office of the Comptroller and Auditor General” is ongoing under the broad umbrella of “Strengthening Public Expenditure Management Program (SPEMP)” funded by Multi Donors Trust Fund. The World Bank is administering the trust fund.

The proposed “Strengthening Office of the Comptroller and Auditor General” project’s aims to support OCAG to attain enhanced professional capacity and operational practice to produce and disseminate timely quality audit reports to the public meeting international standards that earn enhanced responsiveness of the executives.

In December, through bilateral discussions and a widely attended brain storming workshop, the project preparations advanced significantly in defining the project components and activities. The preparation team also discussed expected time frame and identified associated key actions that would be critical to rationalize the project concept, expedite the approval process of the Government, World Bank and the development partners and support successful implementation of the project.

To achieve the broad objective, the proposed project is divided into three key components. The first component aims to strengthen independence and effectiveness of the OCAG. This component would support enhancing independence of OCAG through facilitating enactment and implement of a new audit law, improving OCAG’s support to the Public Accounts committee.

The second Component would work to enhance the accountability and efficiency of OCAG through addressing issues relating to enhancing Audit Quality, coverage, timeliness, improve delivery and deciding high level training needs. It also aims introduce external resources through twinning and contracting, initiating automation of audit process and management etc.

The proposed project also aims to enhance the Institutional Capacity of Financial Management Academy (FIMA) which can be utilized as a centre of educational excellence for supplying comprehensive accreditation courses that meet the needs of the OCAG in increasing the skill level of its staffs to international level.

The proposed project will complement the ongoing CIDA funded “Strengthening Comptrollership and Oversight of Public Expenditure “(SCOPE) Project through a common Result Monitoring Framework and shared and integrated project management with well sequenced implementation plan.

Brussels, 4 February 2010

EU steel market: first green shoots of recovery

EUROFER’s quarter 1-2010 report on the Economic and Steel Market Outlook 2010-2011 signals that economic momentum in the EU economy should gradually gain further strength this year. Progress will be slow and surrounded by uncertainties; however, the risks are now much more balanced than a year ago.

Also in the steel using sectors the recovery will take hold. Activity in the manufacturing sector will be supported by improving international trade and inventory replenishment. The outlook for the engineering industries and automotive manufacturers has become slightly more upbeat. In contrast, perspectives for the construction sector have darkened, mainly due to a further deterioration in the non-residential sector. On balance, output in the steel using sectors will rise 0.6% in 2010. A further strengthening is expected for 2011 with growth accelerating to 3.5-4%.

EUROFER director general Gordon Moffat: “We are seeing the first green shoots of recovery and there is confidence that this will translate into a further improvement in EU steel market fundamentals”.

Recently, orders and deliveries have risen compared with the depressed levels registered in the final months of 2008 and 1^st half of 2009. Low imports and reduced levels of domestic supply have resulted in supply currently being much better aligned with still weak demand levels. Nevertheless, apparent consumption is estimated to have fallen by almost 35% in the whole of 2009.

Low inventories at the start of 2010 will be supportive to market dynamics gradually gaining strength during this year. Any further improvement in demand side fundamentals should trigger a corresponding need to replenish inventories from their current low levels. This will provide the major boost to the 12.5% rise in apparent consumption expected in 2010.

The rebound in real steel consumption expected for 2011 will broaden the basis for growth in apparent consumption.

The import situation remains an issue of concern. So far, rising global steel production has not yet resulted in a significant increase in imports into Europe. But Moffat adds:” if global demand would fail to follow the rising trend in steel output, temporary oversupply elsewhere could lead to import pressure building up in the EU more strongly than currently projected”.

Parliamentarians lift SAIL Cricket Trophy

 

New Delhi, 6^th Feb.’10: A cricket match was played today between Parliamentarians and SAIL teams for the SAIL Cricket Trophy at Modern School cricket ground, Barakhamba Road, New Delhi. Batting first, the SAIL team scored 149 in the allotted overs after losing 4 wickets. Union Minister for Steel Shri Virbhadra Singh, Union Minister of State for Steel Shri Sai Prathap and SAIL Chairman Shri S.K. Roongta presented the SAIL Trophy to the winning team of Parliamentarians which won the match comfortably by 6 wickets.

 

While the Best Player of the Match trophy went to MP Shri Deepender Hooda, MP Shri K.P. Singh Deo was declared Best Bowler,  Shri Gautam Nag of SAIL Best Wicket Keeper, MP Shri Chetan Chauhan Best Fielder and Smt. Ranee Narah, MP, as Best Batsman.

Agreement for SUTP signed with World Bank
  
An agreement for World Bank assisted Sustainable Urban Transport Project (SUTP) was signed between Government of India and World Bank, here today. It was signed by Dr. Anup K. Pujari, Joint Secretary, Department of Economic Affairs on behalf of the Government of India and by Mr N. Roberto Zagha, Country Director on behalf of the World Bank.

The project will have a loan component of US$105.23 million from International Bank for Reconstruction and Development(IBRD) and a grant of US$20.33 million from Global Environment Facility(GEF).

The IBRD loan has a variable spread over LIBOR and is a US $ denominated loan. The projects will be implemented over a period of five years.

The objective of SUTP is to promote environmentally sustainable transport and to improve the usage of environmentally friendly transport modes in project cities. The project consists of Capacity Development Assistance for selected Cities and City Demonstration Projects.

The project will be implemented in five cities of four States: Maharashtra (Pune & Pimpri-Chinchwad), Madhya Pradesh (Indore), Chhattisgarh( Naya Raipur) and Karnataka (Mysore).

On behalf of the States, the Project Agreements were signed by Shri Manu Kumar Shrivastava, Secretary, Urban Development, Government of Maharashtra , Shri Vivek Shrotriya, Joint Collector and CEO, Atal Indore City Transport Services Ltd, Government of Madhya Pradesh, Shri Shyam Sundar Bajaj, Special Secretary, Housing and Environment Department, Government of Chhattisgarh and Shri Shambhu Dayal Meena, Secretary, Urban Development, Government of Karnataka. The signing was done in the presence of Shri S K Lohia, OSD (UT), Ministry of Urban Development.

Formula to tax diesel cars ineffective, says CSE

Digs holes in Kirit Parikh panel’s report

 

• Centre for Science and Environment blasts Kirit Parikh panel report on petroleum pricing that fails to offer effective solution to halt misuse of under-taxed diesel by rich car owners
• Additional excise duty of a mere Rs 81,000 on diesel cars to equalise the excise tax burden on petrol car proposed by the panel – CSE says this is too little too late. The yawning gap between petrol and diesel will continue to incite deadly trend in diesalisation of cars and increase public health risks from toxic emissions
• CSE demands substantial and effective increase in excise duty on diesel cars and SUVs if the taxes on fuels cannot be equalized immediately
• Cheaper diesel fuel will also encourage more cars, more driving and more fuel guzzling in the rebound

 

 

New Delhi, February 5, 2010: The long-awaited pricing formula for petroleum products has been tabled by the Kirit Parikh panel – but the prescription falls woefully short of correcting the distorted taxes on automotive fuels (petrol and diesel), says Centre for Science and Environment (CSE).

 

Because of the distortions in taxes, contends CSE, rich car owners have rampantly misused the under-taxed and under-priced diesel.

 

Says Anumita Roychowdhury, associate director, CSE and head of its air pollution and urban mobility team: “The panel’s formula is not effective enough to check deadly dieselisation of the car segment that threatens to make our air more toxic, as clean diesel fuels and technologies are still not available in our country. The market share of diesel cars is already over 30 per cent of new sales and is expected to be 50 per cent in a couple of years. Car industry has massively scaled up its diesel car production capacity -- without having the requisite clean diesel fuel and technology in place.”

 

Keeping in sight the forthcoming Union Budget, CSE has shot off a letter to the finance minister Pranab Mukherjee, urging him to look into this matter and take necessary steps to equalise or effectively reduce the tax differential between diesel and petrol.

 

What’s wrong with the panel’s formula?

• Fuel prices to be deregulated, but taxes remain skewed: The panel proposes to deregulate fuel prices to allow them to move freely with international pricing trends, but has done nothing to reduce the differential in excise duty on petrol and diesel fuel that is nearly 70 per cent.
• Tax differential justified in the name of agriculture and freight, but rich car owners benefit more: The Parikh panel’s justification for lower taxes on diesel is that diesel is used in different and essential economic activities such as agriculture and freight transport. Ironically, the panels’ own report shows cars are the second biggest beneficiaries of the official tax policy. Cars use up 15 per cent of the total diesel in the country – compared to 12 per cent by buses and agriculture, 10 per cent by industry, and 6 per cent by the railways.
• Additional excise duty on diesel cars proposed to equalise the excise tax burden, but this will be ineffectual: The panel has acknowledged that the higher excise duty on petrol compared to diesel is encouraging diesel cars. But instead of correcting the fuel taxes, it has proposed a mere Rs 81,000 as additional excise duty – this is expected to act as `the equaliser`. The panel completely ignores that this slightly dearer cost of diesel car cannot neutralise the incentive of the cheap running costs that the skewed taxes and cheaper diesel fuels continue to provide. The panel has also extrapolated the incidence of additional excise on SUVs on the basis of petrol cars. This is misleading as SUVs guzzle more fuel and mostly run on diesel; the tax incidence on SUVs needs to be much higher.
• Revenue implications of dieselisation ignored: The government is incurring huge revenue losses due to dieselisation of the private car fleet. It earns much less from excise on a litre of diesel used by cars (as opposed to petrol) -- thus, revenue losses per litre of diesel will be compounded with the increase in diesel car sales. On the other hand, diesel car owners recover their premium within four years, given lower diesel prices. This perverse subsidy to the rich comes at an enormous cost to public health. In countries like Brazil, diesel cars are actively discouraged because of the policy to keep taxes lower on diesel. In China, taxes do not differentiate between petrol and diesel.
• Environmental fallouts of skewed taxes swept under the carpet: The panel, in fact, justifies its move on the ground that diesel cars and SUVs have greater fuel efficiency and should not be penalised. “For the panel, it is okay if people opt for a diesel vehicle to drive much more than an average petrol car,” says Roychowdhury.

 

The panel’s crime of omission: environmental fallouts of dieselisation

Enormous public health costs: Emissions data available from the Automotive Research Association of India has already shown that diesel cars, on an average, emit seven times higher toxic particulates and three to five times higher nitrogen oxides. Official policies are encouraging massive dieselisation of the car fleet when ‘clean’ diesel (less than 10-15 ppm of sulphur) is not available in the country. According to WHO and other international regulatory and scientific agencies diesel particulates are carcinogens.

Even though a few Indian cities will introduce Euro IV emissions standards from April 2010, it will not be adequate to address toxic emissions from diesel and the pollution costs associated with it. According to the European Commission, the total pollution cost of a Euro IV diesel car is Euro 1,195, while that for a petrol version is Euro 846.

Cheaper diesel fuel, more oil guzzling: Studies in Europe have shown how use of cheaper diesel used in bigger vehicles and SUVs undermines the efficiency gains of improved vehicle technology -- actual fuel consumption goes up. Governments across the world are increasing taxes on bigger cars like SUVs (as in China) to minimise the energy and pollution impacts.

Climate benefit of diesel is suspect: Diesel is also a bad news from the perspective of carbon emissions. While more efficient diesel cars may emit lower carbon dioxide per kilometre compared to a petrol car, more carbon dioxide is emitted per litre of diesel fuel burnt. This is because diesel has a higher carbon content than petrol. Now, science also implicates black carbon in diesel particulates for trapping more heat and warming.

 

“Clearly, any further delay in reforming the taxes on fuels can have serious economic and environmental consequences. Distorted pricing will particularly worsen the pollution and energy impacts of explosive diesel car growth,” says Roychowdhury.

 

In its letter to the Union finance minister, CSE has demanded substantial and effective increase in excise duty on diesel cars and SUVs if the taxes on fuels cannot be equalized immediately. Anything less than this, says the Centre, will not be adequate to stop the massive dieselisation of the private vehicle fleet in the country, which is bad for the environment.

 

At the same time, it has also asked for rationalisation of the definition of the small car, that is more lax for diesel cars and is leading to massive dieseliation. SUVs that guzzle more fuels and also use diesel should be taxed higher, says the CSE letter.

 

KIRKLAND LAKE GOLD INC. CLOSES C$32.0 MILLION BOUGHT DEAL PRIVATE PLACEMENT FINANCING

Kirkland Lake Gold Inc. announced today the closing of its previously announced bought deal private placement for gross proceeds of C$32,014,125. The offering was underwritten by a syndicate of underwriters, led by Wellington West Capital Markets Inc. and including Dundee Securities Corp., and acting as a placement agent, Ocean Equities Ltd.

The securities issued and issuable pursuant to the Offering will be subject to a restricted resale period in Canada expiring on June 5, 2010. Application is being made to the AIM Market of the London Stock Exchange for the shares issued and issuable pursuant to the offering, to be admitted for trading on February 11, 2010. The new shares rank pari passu in all respects with the existing issued shares. It is expected that trading in the shares issued on closing will commence on the Toronto Stock Exchange following the expiry of the four month hold period applicable under Canadian securities legislation.

The net proceeds of the Offering will be used for exploration and development of the Company’s mineral projects, working capital, and general corporate purposes.

 

“Kirkland Lake Gold has grown over the last year to over 425 employees. As we make the transition from a development Company to an intermediate gold producer, we are focused on delivering the development work required to increase daily production and extend the life of our mine in a conscientious and timely matter, concurrent with continuing our aggressive exploration and ore-body definition program to expand our resource at the high grade South Mine Complex. I would like to thank Wellington West, Dundee and Ocean Equities for their hard work and continued support,” commented Chairman Harry Dobson.

PM’s address at the inauguration of the 10th Delhi Sustainable Development Summit
  

The Prime Minister, Dr. Manmohan Singh inaugurated the 10th Delhi Sustainable Development Summit in New Delhi today. Following is the text of the Prime Minister’s address on the occasion:

“I am truly honoured to have this unique opportunity to address such a prestigious gathering of government leaders, civil society activists, academics and scientists from around the world. The Delhi Sustainable Development Summit celebrates its 10th anniversary today and with each passing year it has become an increasingly important event on the international environment and climate change calendar.  

The Energy Research Institute, TERI, has, under the able and far-sighted leadership of Dr. R.K. Pachauri, earned well-deserved respect and international acclaim for its contributions to the global effort in meeting the twin challenges of energy security and climate change.  

Excellencies, distinguished guests, this Summit takes place at an important juncture in the international deliberations aimed at forging a multilateral understanding on how to deal with climate change. Moving forward, we need to reflect on the lessons of what happened at Copenhagen.  

I share the disappointment of many with the limited achievements of the discussions that took place at Copenhagen. At the same time it is important to ensure that we can deliver what we promise to do. An ambitious agreement that is observed only in the breach will discredit the whole process. The Copenhagen Accord, which we fully support and will take forward, is a catalogue of voluntary commitments and not a negotiated set of legal obligations. Presumably the countries that have made the commitments willingly have assured themselves that they can be and will be fulfilled. A modest accord that is fully implemented may be better than an ambitious one that falls seriously short of its targets. This is the lesson that was learnt with regard to the Kyoto Protocol. 

Secondly, the United Nations Framework Convention on Climate Change (UNFCCC) has to be the centerpiece of global cooperation on climate issues. The purpose of the Copenhagen Accord is to contribute to the negotiations on the Kyoto Protocol and on Long Term Cooperation. It is not a substitute but a complement to these core international agreements. There is much in the Copenhagen Accord that can bring consensus on the two-track negotiating process. For this to happen, this process itself has to recommence in right earnest, perhaps from March this year.  

Thirdly, a successful international agreement will require a consensus in two crucial areas. The first is on the science of climate change. The second is the ethical framework for giving expression to the central UNFCCC principle of “common but differentiated responsibility”.

Some aspects of the science that is reflected in the work of the IPCC have faced criticism. But this debate does not challenge the core projections of the IPCC about the impact of greenhouse gas accumulations on temperature, rainfall and sea level rise. Let me here assert that India has full confidence in the IPCC process and its leadership and will support it in every way that it can.  
One of the Missions under our National Action Plan is on Strategic Knowledge for Climate Change to promote high quality and focused research on various aspects of climate change. 

We have established an Indian Network for Comprehensive Climate Change Assessment, a network of over 120 research institutes, which will bring out regular reports on the impacts of climate change on different sectors and different regions of the country. The first such assessment will be released in November this year. We seek international collaboration to make this network effective. 

We are also establishing a National Institute of Himalayan Glaciology in Dehra Dun and we look forward to international cooperation in this vital area.

However, even in the absence of unanimity of scientific opinion, many of the actions related to mitigation and adaptation are those we should be taking anyway because of their collateral benefits.  

The lack of global consensus on burden sharing is an even greater barrier to securing an agreement. Industrialised countries in our view need to recognise more clearly their historical role in the accumulation of greenhouse gases in the atmosphere. They should respond with bolder initiatives to contain their future emissions. I would also urge greater financial and technical assistance to developing countries both for adaptation measures to cope with the consequences of these emissions; and for mitigation to reduce their contribution to future emissions. 

Developing countries also need to do their bit. I wish to assure this distinguished gathering that India will spare no effort in contributing to the success of the post-Copenhagen process. The least developed countries and small island states deserve special attention due to their greater vulnerability to climate change. India will support all measures to assist them, both bilaterally as well as in the context of a global climate change regime.

We recently convened a meeting in New Delhi of the Ministers dealing with Climate Change from Brazil, China, South Africa and India. The aim of the meeting was to carry forward the positive and constructive role the four countries played at Copenhagen. We wish to contribute, together with our G-77 partners, to a comprehensive, balanced and above all equitable outcome in Mexico based on the principles of common but differentiated responsibility and respective capabilities.  

We will therefore participate in the negotiations in a spirit of flexibility, acknowledging our responsibilities as citizens of the globe. It is in this spirit that India, and the other BASIC countries, conveyed our respective voluntary mitigation actions to the UNFCCC by 31st of January this year. In our case it is our endeavour to reduce emissions intensity of our GDP by 20-25% by 2020 on 2005 basic levels. We are also very serious about fulfilling and perhaps even exceeding this target. 

In the case of developing countries, climate action has to be combined with their central developmental goals. In a poor country like India, where hope and deprivation co-exist, sustainable development requires that the needs of the present are given at least as much attention as the needs of the future.  

Climate action that delays or makes more difficult the basic task of poverty eradication will be difficult to implement. That is why in our National Action Plan on Climate Change, we have given priority to those activities that mitigate greenhouse gas emissions and also deliver substantial collateral benefits by reducing poverty or by improving local environmental quality and human health.  

We recognise that we have to adopt a different model of growth to that followed by the industrialized countries. But a lot of effort is needed to operationalise the meaning and precise content of sustainable development. The Planning Commission of India has recently set up an Expert Group to prepare a strategy on a low carbon economy in India. The Group will have to work out a holistic approach that takes on board concerns of all stakeholders - industry, transportation, power, labour, micro and small industry and agriculture well in time before we embark on our Twelfth Five Year Plan from April, 2012. 

India has already committed itself to a path of sustainable development based on a graduated shift to the extent possible from the use of fossil fuels to renewable and clean energy, including nuclear energy.  

Within the ambit of our National Action Plan on Climate Change, India has already unveiled one of the world’s most ambitious plans for promoting solar energy, targeting an installed capacity of 20,000 MW by the year 2022.  

We will soon launch an ambitious National Mission on Enhanced Energy Efficiency that will put in place an innovative policy and regulatory regime to unlock the market for energy efficiency, estimated at over US$ 15 billion. It is expected that the initiative will lead to avoidance of capacity addition of nearly 20,000 MW and reduced carbon dioxide emissions of almost 99 million tonnes. 

India has around 22% of its land area under forests. This is significant, given India’s growing population and high population density and this sequesters around 10% of our annual greenhouse gas emissions. Our objective over the next decade will be to increase not just the quantity but the quality of our forest cover, since about 40% of it is degraded forest with little tree canopy and cover. This will enable us to at least maintain this level of carbon sequestration even as we maintain an 8-9% annual rate of real GDP growth.  

It is becoming clear that the roots of the problem we face today are in the current patterns of global production and consumption, which are not sustainable. We are living on an overdraft on Nature’s resources and this is already threatening the ecological balance, which is the basis of our survival. It is my earnest hope that you will approach your deliberations over the next few days, mindful of the challenge we face, not as nations divided by frontiers, but as a world united as one common humankind. With these words, I once again welcome you to Delhi and thank you for giving me a patient hearing.”