Opinion | The challenge of rebuilding Kerala
Live MintAs the flood waters recede gradually in Kerala and the Kodagu district of Karnataka, the focus will begin to shift from relief operations to rebuilding. Such fiscal laws across the world have inbuilt flexibility that allow the borrowing limits to be crossed in the case of special circumstances such as a sharp recession or wars or natural calamities. One possible way to reduce the cost of reconstruction would be the issue of special bonds at interest rates that are far lower than what the bond market would demand. This newspaper suggests that it would be worth structuring a bond where the interest costs of the borrowing are shared by three entities—the Union government can waive taxes; individuals across the world, including the Kerala diaspora, can accept lower interest rates; and the state government will be left with an interest rate that is around a third of what would otherwise have to be paid to investors. Last year’s rankings, released by the government under the Swachh Bharat Abhiyan, ranked Surat as the fourth cleanest city in India, after Indore, Bhopal and Visakhapatnam.Though it has slipped in this year’s rankings, the point is not whether there are parallels between what happened in Surat and what has happened in Kerala and parts of Karnataka, but that natural disasters can provide opportunities for fresh starts.