Indian Current Affairs

16.11.2009

ramkyc@gmail.com (Ramakrishna) — Mon, 16 Nov 2009 01:39:33 PST

Politics & the Nation

National solar Mission set for launch

After a series of consultations with stakeholders, the government has formulated the ambitious National Solar Mission implementation plan to be launched soon.
The National Solar Mission document which sets a target of 20,000 MW for solar power by 2020 was in principle approved by Prime Minister's Council of Climate Change in its meeting last month.
The solar mission sets a goal of making the country dependent on renewable energy.
The other missions currently under formulationa are: the national mission on enhanced energy efficiency that will have a target of about Rs 75,000 crore worth transactions in energy efficient systems, on water efficiency, on sustainable habitat and afforestation and agriculture.

Finance & Economy

Look Ma ... Buffet's is betting!

Warren Buffet, the world's famous investor is betting big on the US economy. This at a time when there are more skeptics about US economy than there were at any time in the past. He reinforced his belief by investing so heavily -- reportedly the single largest investment that his Berkshire Hathaway made ever -- in a single company. That is a railroad company in which he already holds a substantial stake.
If we say Warren Buffet is taking a big gamble, chances are that many will pooh pooh the idea. Time only should tell whether or not the investment that he is making will yield the kind of results that his investments so far have yielded.

Take a look at this quirk of tax policy / administration mechanism. It ensures that subsidy that is meant for the poor ends up in state treasuries instead.

This was explained beautifully in today's ET editorial.

Is the government's intention of providing Air India (AI) with an aid of Rs. 2,000 crores going to solve the troubles of the National Carrier?

Take a look at these facts and figures before coming to any conclusion:
AI’s working capital liabilities have quadrupled to Rs 16,000 crore in under three years. Its latest annual results show a 12% drop in revenues to Rs 13,479 crore. Besides, last year alone, its losses added up to a whopping Rs 5,548 crore. Till recently, AI was on an aircraft-buying spree despite being thoroughly in the red. Reports say that AI plans to reduce its fleet size to 100-105 from the current 132.

RIL to join hunt for shale gas

So reads a headline. What is shale gas?
Shale gas is natural gas produced from shale — a fine grained sedimentary rock composed of flakes of clay and minerals like quartz and calcite.
The future of energy is a low-carbon regime. Shale gas is one such example. It is somewhat like coal-bed methane and is on land. The US has made major strides in the technology in shale gas that has made it now a commercial proposition.
The cost of production of shale gas has fallen by 80% over the past five years in the US with new technologies and fiscal incentives provided by that country to encourage exploration.
The largest known reserves of this gas is found in Canada and the US followed by Australia and some parts of Europe.
It is estimated that almost 50% of North America’s energy consumption in the world be met by shale gas by 2020.

International

US yet to appoint an ambassador to WTO

Launched in November 2001, the Doha Round seeks to open up world markets in goods and services further. It has suffered setbacks in the past eight years due to conflict of interest between developed countries, including the EU and the US, and leading developing countries such as India, China and Brazil. Several issues relating to agriculture and industrial goods have held up the talks.

Is there an eastward shift in global markets?

Yes there is. Between 2002 and 2007, the number of listed companies on the Nasdaq stock market and New York Stock Exchange (NYSE) dropped by 16% and 3% respectively, while the Asian markets increased significantly, with India growing 47%, South Korea 157% and Singapore 62%.
A similar eastward swing has occurred with regard to market capitalisation of the world’s stock exchanges. Between 2003 and 2008, the Nasdaq and NYSE decreased by 16% and 19% respectively, while the Asian markets enjoyed significant increases. India surged 132%, Shanghai 296%, and Hong Kong 86%.
Many economists believe the recovery will be driven by a new phenomenon: growing consumer spending in emerging markets, with India in the forefront. This shift towards consumer-led growth in emerging countries will transform these areas into important import markets for the world’s manufacturers.
Not only this, a great deal of the eastward tilt stems from the escalating flow of capital across borders in recent years. Since the introduction of the reform process in the early 1990s, India has witnessed a significant increase in capital inflows — in the form of foreign direct investment, foreign portfolio investment, external commercial borrowing and non-resident Indians’ inward remittances. The size of net capital inflows to India rose from $7.1 billion in 1990-91 to $108 billion in 2007-08. Today, India has one of the highest net capital inflows among the emerging market economies of Asia.
For an explanation of the factors that is leading to this eastward shift, read this article by Jim Quigley, the CEO of Deloitte Touche Tohmatsu.

What is special about November 11?

It is variously called Armistice Day, Veterans Day or Remembrance Day around the world.
This is the day on which World War I ended.
Now it’s more or less a generic day honouring any soldiers who’ve died in battle, in every Commonwealth country, Europe and the US.
The day is remembered by wearing red poppies -- or red paper blotches on lapels -- for almost a month before and after November 11. Tradition has it that these ubiquitous red poppies kept on blooming in the killing fields of Flanders.

Sport

Sachin gets into trouble with Shiv Sena

Sachin Tendulkar was in the midst of a controversy with Bal Thackeray accusing the cricket icon of hurting Marathi sentiments with his “Mumbai for all” remark.
In an interaction with the media on completing 20 years in international cricket, Tendulkar had said, “I am a Maharashtrian and I am extremely proud of that. But I am an Indian first. And Mumbai belongs to all Indians.”

Language lessons

sputtering

Noun: The noise of something spattering or sputtering explosively
Verb: Make an explosive sound; Cause to undergo a process in which atoms are removed; Climb awkwardly, as if by scrambling; Utter with a spitting sound, as if in a rage; Spit up in an explosive manner
eg: "Our economy was sputtering, still is sputtering some."

antsy: Adjective

Nervous and unable to relax
eg: ...That meant antsy stakeholders, falling sales and a bone-dry investment tap.

bone-dry: Adjective

Without a trace of moisture; as dry as a weathered bone

munificent: Adjective

Very generous
eg: "a munificent gift"; "his father gave him a half-dollar and his mother a quarter and he thought them munificent"

13.11.2009

ramkyc@gmail.com (Ramakrishna) — Fri, 13 Nov 2009 02:46:20 PST

Politics & the Nation

Take a look at how the Indian Army is facing shortage of officers

Read this story.
Isn't there a lesson in it? What should be done? Any ideas?

Some very good thoughts on handling funding of political parties

Largely there prevails a view that it is the money power of candidates that is corrupting the political system in our country. Here are some thoughts on how to curb the money power. Some excerpts from the debate:
While banning corporate funding of parties, providing a combination of state subsidies and private funding with stringent regulations on transparency and accountability of public and party funds, may do the trick. Such a step together with internal reform of parties might help break the unholy nexus and clean up public life.
Any candidate found to have paid for votes must be debarred from contesting an election for a minimum of 10 years. The political party to which this candidate belongs must not be allowed to contest from that seat for five years.

Finance & Economy

A tribute to the dabbawallahs of Mumbai

Yesterday, Pepsico's Board of Directors was trying to learn lessons from the dabbawallahs of Mumbai. What else can be a befitting tribute to them? They deliver over 2 lakh lunch boxes everyday with such great accuracy that the corporate world wants to learn lessons from them.
Apart from the dabbawallahs, other notable Indians sharing their wisdom with the Pepsi's 11 member board were Ratan Tata, Azim Premji and Ramachandra Guha, the eminent historian.

IIP numbers bring lot of cheer

Industrial output grew by a surprisingly strong 9.1% in September from a year ago, reinforcing optimism that economic recovery is on track and imparting urgency to the debate over the timing of the withdrawal of stimulus measures that were put in place to counter the slowdown.
Strong growth in factory output, or manufac turing — one of the three components of the in dex of industrial production (IIP) along with elec tricity and mining — was driven by a surge in consumer durable production and output of cap ital goods. Festival buying, continued stimulus measures and a pick-up in demand following the release of wage arrears for government staff boosted buying of a range of consumer goods.
Prime Minister Manmohan Singh said last week that the government would start rolling back the stimulus measures from the next year and RBI has already signalled a hardening of its monetary policy stance with a 100-basis point increase in the statutory liquidity ratio.
The government expects the economy to grow at 6.5% in the fiscal to March 2010, slightly slower than the 6.7% pace in 2008-09, as it feels the effects of lower farm output because of a deficient monsoon. Gross domestic product grew by 6.1% during the April-June first quarter.
Look at this graphic to get a better comprehension in this connection.

India becomes an export hub for mobile phones too

The country’s not just a small car hub, handset manufacturers such as Nokia, Samsung, LG, Sony Ericsson and Motorola are shipping 60 million mobiles each year from the country to more than 60 countries mostly in Africa, South-East Asia, Middle East and South Asia.
India, which accounts for one in every 10 handsets made in the world, now plans to more than double its production from 120 million devices in 2009 to 250 million units by 2012.

On our rural consumer market

The rural consumer market, which grew 25% in 2008 when demand in urban areas slowed due to global recession, is expected to reach $425 billion in 2010-11 with 720-790 million customers, says a white paper prepared by CII-Technopak. That will be double the 2004-05 market size of $220 billion.

Books

10 must reads for budding entrepreneurs

Worth our attention. Take a look.

Miscellany

Know your booze

Though booze should be the last thing that we need to know about, as you mature with experience in life, there will be situations wherein being an ignoramus about it can be quite an inconvenience as we found out in our life.
To get over such situations, nothing can be quite educative than this piece that appeared in today's ET.

Language lessons

kosher: Adjective

Proper or legitimate; Conforming to dietary laws
eg: KYC norms, aimed at ensuring banks are not used as a channel to route funds that are not kosher, often hamstring ordinary citizens.

What is sauce for the goose is not sauce for the gander

This is an old saying. If some kind of behavior is wrong, it's probably wrong for both sides, not just one. Don't do it yourself either.
This meshes well with the Golden Rule, or ethic of reciprocity, which is a key moral principle in many religions and philosophies, and is often stated as "Do unto others as you wish to be done for you", or conversely, "Don't do unto others what you would not wish to be done to you."

slather: Verb

Spread thickly
eg: Considering she has probably notched up quite a few years of such reckless behaviour, she could well have been ‘ageing’ enough to prompt her anguished son to want to be by her side to slather on some last minute creams and potions, and perhaps take her to a spa.

12.11.2009

ramkyc@gmail.com (Ramakrishna) — Thu, 12 Nov 2009 03:23:47 PST

Politics & the Nation

Cyclone 'Phyan' fizzles out; leaving Mumbai breathing easy. But insurance companies are poorer by Rs. 10 crore for the abandoned cricket match

It scared the city literally out of its workplaces, but ended up as a calamity that never happened. The cyclonic storm ‘Phyan’, which threatened to hit Mumbai on Wednesday afternoon, crossed the western coast close to Mumbai, but spared the metropolis and weakened without causing any major damage.
But it sure drills a hole in insurers' pockets. Take a look at this story to know how.

Internet for India's masses

Come February 2010, millions of non-English speaking Indians will be able to type .bharat in devnagari while accessing popular websites.
The Internet Corporation for Assigned Names & Numbers (ICANN), the global body which sets the standards for the Internet, decided to make addresses available in non-Latin scripts on October 27. The move was in response to requests from a number of countries, including Japan, Korea, India and China.

Finance & Economy

Air India suffers huge loss

National carrier Air India on Wednesday announced that it has incurred a loss of Rs 5,548 crore in 2008-09 due to global economic slowdown but hoped to post better operating performance this year.
Total revenue fell to Rs 13,479 crore in FY09 from Rs 15,252 crore in FY08, the airline said in a statement. However, last year’s financial performance was better than the previous year’s when Air India had suffered a net loss of Rs 7,200 crore.

On Copenhagen meet

We keep reading quite a bit about it in newspapers. After some time, we are reduced to a stage wherein we know largely the positions of countries either individually or collectively and are at a loss as to whether something concrete can come out of such attempts. We are sure that the Copenhagen meet will not be able to deliver anything concrete, as things stand today.
But is that reason enough to stop wracking our brains about it? Should the search for solutions to the pollution conundrum be put an end to? Common sense tells that it should not. But a logjam seems to be staring us in our face. In such situations, a whiff of fresh air in the form of off-tangent thoughts does bring in some great relief.
Take a look at today's op-ed by Mukul Sanwal. It does look at things differently. Worth a read. You can even keep it for reference. Will do you a lot good in articulating your views on the subject in interviews.

On the benefits of disinvestment in PSUs (Excerpts from an article written by TT Ram Mohan in today's ET)

Is it true that there will be fiscal benefits on disinvestment in PSUs?

Though this is one of the reasons cited for proceeding ahead with disinvestment, the benefits are largely illusory.
First, the planned disinvestment won’t happen overnight. So there is no immediate relief to the fisc by way of large inflows.
Secondly, when the government sells its equity in a PSU, it is only realising upfront the value of dividends it would realise over the life of the PSU. Any gain to the fisc in the short-term is offset by a loss of the stream of dividends over a longer period.

Can disinvestment in PSUs be an instrument for improving their performance?

Government firms become subject to greater market discipline as the stock price is watched daily. The existence of retail and institutional shareholders acts as a check on political interference that would adversely impact the stock price. Management becomes more focused on commercial performance when subject to continuous monitoring by analysts and comparison with peers. This explains the trend towards convergence in performance between PSUs and private firms in the post-reforms period, as several studies have shown.

PSUs are largely seen as having some inherent strengths: For instance, it is felt that the Satyam type of scams are less likely to occur in PSUs, because of the elaborate system of checks and balances that is put in place in PSUs. Then, the mechanism of independent directors can work better in PSUs than in private sector, because they don't owe their existence to the management but to government. Can you throw some suggestions on how to leverage these inherent strengths to gain a governance edge over the private sector?

Include representatives of workers, institutional shareholders and minority shareholders on boards.
Improve on the present compensation levels for independent directors without erring on the side of excess.
Create a system for evaluating board performance.
Devise a mechanism whereby independent directors who perform can graduate from the lesser PSUs to the more prestigious ones.

Legal

SC wonders whether it can usurp Parliament’s powers
Questioning one of its own earlier directions to rein in unruly students union activities, the Supreme Court on Wednesday referred to a constitution bench a crucial question as to whether courts can frame laws, a role reserved for the legislature. A bench of Justices Markandeya Katju and Asok Kumar Ganguly maintained that even though they too were concerned over rising prices and unemployment, courts cannot be expected to pass orders to government on such issues as they are in the exclusive domain of the legislature. “...We do not have the expertise though we are also affected by the price rise,” the bench observed.
Language lessons

presage: Verb

Indicate by signs
eg: The founding family of India’s largest real estate company has reached a deal with DE Shaw to buy out the hedge fund’s stake in DLF Asset (DAL), an important step presaging transactions that could lead to a Singapore listing for the DLF affiliate in the first quarter of 2010.

feisty: Adjective

Showing courage; Quick to take offence
eg: IWAS raised as a pretty poor farm girl in Wisconsin and always thought of upgrading myself. So I over-achieved! I was lucky...” A characteristically short bio from Carol Ann Bartz, the feisty chief executive of the $7.2 billion internet company Yahoo! ...

stupor: Noun

The feeling of distress and disbelief that you have when something bad happens accidentally; Marginal consciousness
eg: "someone stole his wallet while he was in a drunken stupor"

tedium:

The feeling of being bored by something tedious; Dullness owing to length or slowness
eg: The tedium of her golf handicap improving only from 40 to 28 and days filled with gardening, photography and reading were only partly responsible.

suss: Verb

Examine so as to determine accuracy, quality, or condition
eg: And that trait manifests itself not only in her love for reading up on subjects as diverse as the cleverness of crows to weird everyday events, but also to her practice of taking prospective team members out for a meal to suss them out.

noblesse oblige: Noun

The obligation of those of high rank to be honourable and generous (often used ironically)
eg: In this era of intense scrutiny, a touchy-feely gambit can backfire on politicians if they are not temperamentally inclined towards it, due to which the public perceives the gesture as noblesse oblige instead.

11.11.2009

ramkyc@gmail.com (Ramakrishna) — Wed, 11 Nov 2009 01:55:07 PST

Politics & the Nation

National Education Day celebrated

It was celebrated to commemorate the birth anniversary Maulana Abul Kalam Azad, independent India's first education minister.
The government has started major expansion of higher education by opening eight new IITs and 15 Central universities.
It has also been decided to set up six IIMs, 10 NITs, 20 IIITs and 6,000 model schools during the 11th Plan (2007-12).
It was in this context and on this occasion that the PM was remarking that we face difficulty in finding top level professors and lecturers in the newly created IITs, IISERs and other such institutions.
This function was also attended by UNESCO Director General Koichiro Matsuura.

Cyclone to hit Gujarat and Maharashtra

Cyclonic storm 'Phyan' will hit South Gujarat and North Maharashtra by late evening today following a deep depression in the South East and adjoining Central Arabian Sea.
Let us hope it doesn't leave too much of a havoc in its trail.

Finance & Economy

Here is an excellent discussion on how best to ensure that subsidies / benefits meant for the poor reach them.

It is, sort of high end stuff that transpired between SSA Aiyar and Jean Drez. Take a look.

White Paper on GST released

The government yesterday released the first discussion paper on GST. Some of the salient features outlined in the paper include:

A dual GST model with two separate components: central GST (CGST) and state GST (SGST).
Both Centre and state to levy GST concurrently on all goods and services other than a small exempted list.
Cross-utilisation of input tax credit between CGST and SGST would not be allowed except in case of inter-state transactions (IGST).
GST to have a two-rate structure: a lower rate for necessary items and standard rate for general goods.

If you want to get a backgrounder on introducing GST in India, this working paper on GST Reforms written by Satya Poddar and Arvind Virmani will be quite helpful.
If you have the patience to go through the white paper and offer your remarks, you can find the white paper here.
Incidentally Satya Poddar described the first discussion paper on GST as “a patchwork of political compromises which is neither good economics nor good politics”.
We are surprised that the finance ministry site doesn't host the white paper!

International

India's Boric acid row with the US

This is an ongoing dispute between the two countries. Take a look:
The US, which is a major producer and exporter of pharmaceuticals and chemicals, sees a good market for boric acid — a chemical used as insecticide and also in antiseptics, flame retardants and as a controlling agent for uranium fission.
American allegation
US seeks clarification from India regarding how India considers boric acid to be in automatic import license list with quantitive restrictions in place
Indian response
India says the no-objection certificates that traders require for importing boric acid is only to ascertain the purpose for which it was being used. The govt wants to ensure the imports are for nonpesticide use.
Want to get a lowdown on the issue? Read this news story.

China making right noices ahead of Obama's visit?

A visiting Chinese deputy governor of PBOC (People's Bank of China -- China's central bank) is reported to have told that China is contemplating a gradual liberalisation of its exchange rate.
The Chinese currency Renminbi, or people’s money, established in 1948, is popularly known as yuan. It was made fully convertible on the current account in 1996, when it was pegged to the dollar.
The dollar peg was, however, abandoned since July 2005, with the yuan having been pegged thereafter to a basket of currencies and allowed to move up or down in a narrow range of 0.3%.

Sport

Germany's goal keeper Robert Enke dead

Robert Enke, the Hannover and Germany goalkeeper, died after being hit by a train, according to police. He was 32.
Police suspect that it is a case of suicide.
Enke played eight matches for Germany. Enke and his wife lost their 2-year-old daughter to a heart ailment in 2006. Enke had reportedly been “unstable” recently, but that it had not been publicly noticed.

Language lessons

moue: Noun

A disdainful grimace
eg: Haute fashion label Chanel now has Vanessa Paradis as the face (or rather, moue) of a new lipstick line and Georgia May Jagger has filled the gap left by the exit of Kate Moss from Rimmel.

diastema: Noun

A gap or vacant space between two teeth

exeunt: Interjection

(stage direction) instruction to exit
In India, where Bollywood is the beacon for fashion and beauty trends, gap-toothed appeal has been markedly absent after the exeunt of Nargis and Mehmood, with most actors resorting to cosmetic dentistry as a prerequisite; the modelling world is equally close-set in its notions.

didactics: Noun

The activities of educating or instructing; activities that impart knowledge or skill
eg: The special guest — the first lady, Michelle Obama — doesn't make her appearance alongside Big Bird until midway into a show crammed with the usual preschool didactics.

gentrify: Verb

Renovate so as to make it conform to middle-class aspirations

10.11.2009

ramkyc@gmail.com (Ramakrishna) — Tue, 10 Nov 2009 00:44:42 PST

Politics & the Nation

Very disturbing developments in Maharashtra Assembly

By now all of you would have read about the story that a certain Samajwadi Party MLA was heckled / beaten for taking the oath in Hindi.
Take a look at this ET editorial that beautifully sums up the idea of India while castigating this behaviour on the part of the MNS MLAs.
The Maharashtra Assembly did well to suspend the MNS MLAs for a period of 4 years. We are surprised as to why it did not suspend them for the full 5 year term. That should have conveyed a strong message to the people who elected them in the first place. No people, party, religion or some such grouping within the country, should ever be allowed to challenge the idea of India.

In the context of the statements emanating from China on the eve of the Dalailama's visit to Arunachal Pradesh, it is well worth our effort to take a look at the dispute between India and China over Arunachal Pradesh

Today's ET story did an excellent job of giving a backgrounder to the issue. Read on...
In 1913-14, China, Tibet & Britain tried to hammer out the Simla Accord — a deal defining borders between Inner & Outer Tibet, and between Outer Tibet & British India. Henry McMahon, a British administrator, drew up 550 miles of the boundary demarcating British India and Outer Tibet. China walked out of the talks, rejecting the line between Inner and Outer Tibet, but the Accord nonetheless ceded Tawang and other Tibetan areas to the British Empire.
Since then, China has declared the line invalid, citing the absence of its signature on the Simla Accord. After the collapse of Chinese power in Tibet, the McMahon line was, de facto, accepted as official, & Britain established administrations in the area. However, Tibet & later the People’s Republic of China claimed Tawang district after Indian independence. With China all set to take over Tibet, India declared the McMahon line the official boundary in 1950.
The North East Frontier Agency was created in 1954. The Tibetan uprising was suppressed by China & its self-ruling government abolished in 1959. The Dalai Lama fled to Dharamsala, and maps published by the Tibetan government-inexile now show McMahon Line as the southern border of Tibet.
During the 1962 war, China acquired large parts of NEFA but voluntarily withdrew back to the McMahon line. It was only in 1985 that China declared its ownership claims on the eastern tract roughly corresponding to Arunachal Pradesh.
Until then, it was prepared to cede this land to India if it was given the cold western desert of Aksai Chin in Ladakh, of strategic importance to China. India rejects China’s claims over both, & post-1985 China has insisted that Arunachal Pradesh is theirs.

Finance & Economy

India's per capita income to overtake that of the US and UK by July 2048!

Read this prediction from Hans Rosling of Sweden's Karolinska Institute. Whether or not this turns out to be true cannot be known as many of us may not be alive then. Nor will he, because he is already 61 years old now. But it does make an interesting reading. Take a look.

SEBI proposes sweeping changes in public offers

THE Securities and Exchange Board of India on Monday proposed changes to the way public share offerings are done, spelt out guidelines for smaller companies to raise capital through share sales, and called for more disclosures from listed companies to prevent delayed shocks in the form of holes in the books of accounts.
It is a development of far reaching consequences for the investors. Take a look at the full story.

Want to get a feel of how hawala transactions happen?

We are sure, you can't better a news story to do the job than this one.
At one time or the other in your careers, you may have to tackle these hawala networks. This background should come in handy then.

CK Prahalad on the inevitability for companies to recognize sustainable development.

A very good interview that throws some light on the concept.
Don't ask us who is this Prahalad; will you? He is the well-known management guru that has propounded the 'bottom of the pyramid' and 'core competence' concepts.

International

How did the US dollar become strong/overvalued? What are the consequences of its strength?

Its overvaluation began with the Mexican peso crisis of 1994, and was officially enshrined by the “strong dollar” policy adopted after the East-Asian financial crisis of 1997. That policy produced short-term consumption gains for America, which explains why it was popular with American politicians, but it has inflicted major longterm damage on the US economy and contributed to the current crisis.
The over-valued dollar caused the US economy to haemorrhage spending on imports, jobs via off-shoring, and investment to countries with under-valued currencies. In today’s era of globalisation, marked by flexible and mobile production networks, exchange rates affect more than exports and imports. They also affect the location of production and investment.

Technology

Bharti Airtel's great use of SMS technology

Read this story. It is about how it has deployed a customized SMS platform for a lot many internal transactions. It is called me-tize.
We think that it can start selling this application / platform to other corporates.

Language lessons

deracinate: Verb

Move (people) forcibly from their homeland into a new and foreign environment; Pull up by or as if by the roots
eg: Some sections of the metropolitan elite tend to venerate as the secular Indian a deracinated Ram Robert Rehman who celebrates the festivals of all religions but has contempt for spirituality and for all Indian ‘dialects’ and the cultures encoded in them.

stanching: Verb

Stop the flow of a liquid
eg: China’s currency policy means that dollar depreciation, rather than improving America’s trade balance and stanching its leakage of jobs and investment, may inadvertently spread these problems to the rest of the world.

09.11.2009

ramkyc@gmail.com (Ramakrishna) — Mon, 09 Nov 2009 01:40:39 PST

Politics & the Nation

A good editorial comment on funding in politics

Politics in the real world needs funding. And this funding must have an institutional basis. In the absence of an institutional source of funding, diverting funds from the exchequer, predatory practices and patronage have become routine forms of moibilising funds for political parties. Politicians do the mobilising and keep a good part of what they collect to themselves. In the process, they also suborn the bureaucracy, without whose collusion neither predation nor patronage can work.
Political funding has to change. Funding must become broadbased, state-aided and transparent. Auditing of political party accounts must cease to be cursory. We need reform, and need it fast.

IRDA working overtime to come up with an insurance scheme that covers almost all poor families.

The insurance regulator has proposed a new consolidated health and life cover for over six crore poor families that will replace all existing insurance schemes sponsored by the central and state governments.
The Insurance Regulatory and Development Authority (Irda) plans to provide every poor family a life cover of Rs 1.5 lakh and a medical cover of Rs 1 lakh. An integrated cover will cost Rs 1,500 per annum, of which the Centre will bear half the premium and the rest will be shared equally by the states and the beneficiaries.
The proposal, estimated to cost Rs 12,000 crore, will cover most families in the unorganised sector and will replace all other central and state-sponsored insurance schemes.
The proposal is being examined by the Thirteenth Finance Commission, which is a constitutional body that recommends formula for sharing revenues between the Centre and the states.
The Centre’s share of the premium works out to around Rs 6,000 crore per annum, and about Rs 30 a month for a poor family.
Today, both the Centre and the states spend over Rs 4,000 crore on social insurance schemes with different claim ratios. It is believed that the insurance coverage and costs can be optimised with a well-designed scheme that integrates all the risk covers: health, partial and full disability, and death.
Government-sponsored insurance schemes include the flagship Rashtriya Swasthya Bima Yojana (RSBY) that provides health insurance to poor households and Aam Aadmi Bima Yojana (AABY) that offers death and disability insurance to the unorganised sector.

BJP heaves a sigh of relief

With the dissident campaign in Karnataka having been effectively contained, and truce having been brokered between the two -- the Chief Minister and the dissidents led by Janardhan Reddy, BJP can at last heave a sigh of relief; even if it is temporary.
Read this story. Makes an interesting reading.

Finance & Economy

RIL in acquisition mode?

Reliance Industries is reportedly in talks to acquire LyondellBasell, a US based petrochemical major that is undergoing reorganisation under the protection of a US court.
RIL will enjoy a lot of synergies if it acquires LyondellBasell. It will benefit from state-of-the-art technologies of LyondellBasell. Besides, its marketing and distribution network come in handy. LyondellBasell will provide a ready market for RIL and RIL may turn it around if it is able to source feedstock at a cheaper rate.
LyondellBasell had posted a loss of $7.3 billion on annual revenues of $50.7 billion. It has $27 billion of assets and $19 billion of debt. RIL is smaller. It had a profit after tax of $3 billion on a topline of $29 billion for the year ended March 31, 2009.
LyondellBassell is the outcome of a number of mergers. Lyondell Chemical Company was earlier listed on the NYSE. It was the third largest chemical company in the US. In December 2007, it was acquired by Basell Polyolefins for $12.7 billion to create LyondellBasell — one of the world’s largest polymer, chemical and fuel companies. RIL has been eyeing the company after it filed for Chapter 11 under the US Bankruptcy Code in January 2009.
The primary products of LyondellBasell are polymers (polyethylene, polypropylene), chemicals (styrene, ethylene) and fuel (two oil refineries — one in Houston, one in France). The Houston refinery processes heavy crude (mostly from Venezuela) and has a capacity of 13.5 million tonnes/year.
The other refinery in France, which was purchased from Shell in 2008, has a capacity of 5 million tonnes. The US arm of the company had filed for bankruptcy protection on January 6, 2009.On September 15, LyondellBasell announced it will shut its 185,000 tonne a year low density polyethylene plant (LDPE) in the UK.

Should insurance agents be paid commission?

As the agent’s income is directly linked to sales, it is inevitable he will look after his own interest rather than that of the consumer and is likely to withhold the information that may jeopardise the closure of a transaction. This structure of commission encourages agents to sell policies that give them the highest commission. Generally, the agent lacks the qualifications and expertise of an adviser to assist consumers in evaluating and identifying a suitable product according to his requirements. Hence, the concept of commission-based agent is fundamentally flawed as it shortchanges consumers.
There are dozens of insurance companies offering a wide range of products from plain vanilla to complex insurance-cum-investment schemes. Evaluating them requires information, time and expertise. In such a scenario, the utility of the agent to a consumer is greatly reduced to mere service provider, at best, and gives way to a qualified adviser. This necessitates segregating the role of agents and financial adviser. Those consumers who want advise should pay for it and a regulatory framework for advisers would be desirable. Insurance companies can re-train their over one million agents if they want their services. There is no justification to make an exception, for commission, for insurance products.
Yet another view point runs like this:
Insurance companies carry additional risks on liabilities side. One bad risk would entail huge claim outgo. An agent plays a pivotal role in risk assessment process and therefore represents only one company and has to be compensated by his principal and not the investor.

A very good graphic on GST

You shouldn't miss reading this.

The concerted actions of policymakers to revive the global economy are doing more to reflate asset prices than lift economic growth; writes Ruchir Sharma

You must read this article to get a feel of the study. But some excerpts worth our attention:
Even though policymakers may have been successful in preventing the global economy from falling into an outright liquidity trap, there are now increasing signs that they are not getting the desired results in terms of fostering a sustainable recovery. A lot of the excess liquidity pumped into the system is heading towards unproductive assets in a way that could derail the comeback story.
It is incredible that oil and many other commodity prices are now trading well above the average price that prevailed during the 2003-07 economic boom even though demand is yet to recover. Global spare capacity is currently running at 8% and in the past, oil prices have only risen when spare capacity was below 5%. Indeed, world oil demand is set to contract in 2009 for the first time since 1983.
Speculative turnover in the commodity markets is also huge. Estimates put the daily trading volume of futures contracts in the energy space at a staggering 15 times underlying demand. The norm, just five years ago, for trading volumes of various commodities was four to five times actual demand.

SEBI mulls reforming the Mutual Fund industry

Capital market regulator Sebi plans to increase investor participation in mutual fund schemes to protect retail investors from the impact of selloffs by large investors and corporates.
Sebi is likely to increase the minimum number of investors required in a mutual fund scheme from 20 at present and bring down the maximum holding by a single investor from the current level of 25%.
The trigger for the proposed changes is the last year’s events that saw the mutual fund industry being rocked by sudden withdrawals by large institutional investors, especially in debt schemes, due to a liquidity crunch. Sebi is keen to ensure that redemptions by a few investors do not destabilise the schemes and create a run on the fund, impacting retail investors for whom MFs were designed. Industry officials say corporates own more than 50% of the total assets under management of MFs.
At present, Sebi rules require a MF scheme to have a minimum of 20 investors, with a single investor not owning more than 25% of assets. The rule — popularly known as 20-25 rule in MF industry circles — is applicable only at the scheme level and not at the plan or sub-plan levels. Typically, a scheme offers different plans that promise faster growth, higher dividends and bonuses. The 20-25 rule is unique to India.

International

It is two decades since the Berlin wall fell

Read this news report about the fall of the Berlin wall. Takes us back in time.

Language lessons

execrable: Adjective

Of very poor quality or condition; Unequivocally detestable; Deserving a curse
eg: A recent report has it that among the plethora of existing execrable violent games , which seem to have legions of addicts across the globe, a new one is based on the ‘raping skills’ of players.

whinge: Verb (also whingeing or whinging)

Complain peevishly in an annoying or repetitive manner

zombified: Verb

Turn into a zombie

zombie: Noun

A dead body that has been brought back to life by a supernatural force; Someone who acts or responds in a mechanical or apathetic way

palaver: Noun

Noun: Flattery intended to persuade; Loud and confused and empty talk
Verb: Speak (about unimportant matters) rapidly and incessantly; Influence or urge by gentle urging, caressing, or flattering; Have a lengthy discussion, usually between people of different backgrounds

07.11.2009

ramkyc@gmail.com (Ramakrishna) — Sat, 07 Nov 2009 02:25:05 PST

Politics & the Nation

India signs fusion energy research pact with European Union

India and the 27-nation European Union (EU) have signed an agreement for cooperation in the field of Fusion Energy Research and agreed over the free trade treaty by next year to boost trade and investment.

SC stays HC order on job reservation for disabled

The Supreme Court on Friday stayed the Delhi High Court order directing the Centre to provide three per cent job reservation for persons with disabilities mandated under a special legislation which includes one per cent for visually-impaired candidates.
However, the Bench clarified it was not staying the Disabilities Act under which three per cent jobs should be reserved for disabled persons, including one per cent for visually-impaired candidates.
The apex court had directed the Centre to file a detailed status report regarding the extent to which the posts had been identified and filled up and also what steps had been taken to fill up the vacancies that had arisen since the Act has gone into force in 1996.

Finance & Economy

FBT burden on employees to be spread out in the next four months

The July 2009 Budget dropped FBT and returned the earlier system of taxing perks in the hands of the employee. But the CBDT has not yet given the guidelines for computation of perks. In the absence of the guidelines, employers were not deducting any tax from employees. Once the guidelines are made available the entire tax will have to be recovered in one go.
Employees of those companies that had already started deducting tax on these benefits as per the old rules, which were in effect before the controversial FBT was introduced in 2005, would not be hit so hard as they would have paid some tax. However, as the overall liability is likely to be more due to the government’s plan of bringing more benefits under the tax net, they too will have to shell out additional amounts.
In the perks taxation regime before FBT, perquisites that were taxed included rent-free accommodation, car, chauffeur, services of personal attendants, concessional education, concessional journeys, credit card, interest-free loans, gift vouchers, hotel stay exceeding 15 days and medical facilities. The value of these services was the actual cost to the employer.
The Finance Act 2009-10 also made employee stock options and employers’ contribution to the superannuation fund taxable, if the amount exceeded Rs 1 lakh per annum. Total FBT collections in 2008-09 stood at Rs 7,997 crore.

Indian tea bushes in for rejuvenation

Many of India's tea bushes are reportedly very old; some even as old as a hundred years. This is what makes the tea less tasty. Therefore, the tea gardens are on a replanting spree.
Replantation cost in North Indian gardens is Rs 3.03 lakh per hectare, compared to Rs 5 lakh per hectare in South India. The productive life of a tea bush is 50 years. Assam has 3,00,000 hectares under tea plantation. The Dooars, Terai and Darjeeling tea estates together cover an area of 1,14,000 hectares. South Indian gardens are spread over some 1,22,000 hectares.
Of the total 5,36,000 hectares that is under tea, nearly 2,12,000 hectares are planted with bushes well over 50 years of age. In comparison, Sri Lankan tea bushes are a little over 30 years old, while Kenyan tea bushes are much younger.
Some big names in Indian tea business: McLeod Russel, Goodricke, Warren Tea, Dhunseri Tea, Rossell Tea, Gillanders Arbuthnot, Amalgamated Plantations.
Indian tea, sells some 210 million kgs in the export market, besides some 740 million kg locally.

Why is divestment in PSUs good?

This is good for the stock market (increases depth, absorbs more capital with less asset price inflation); good for public enterprises (make their accounts more transparent and available to the public at large rather than only to Parliament as at present); and for the spread of shareholding culture among Indians.

It is often said that the government should not own non-strategic enterprises. What does 'strategic' mean in the context of government's investments in commercial enterprises?

Strategic, here, should be understood as providing long-term competitive advantage to the economy, apart from being vital for national security, but not coming forth except for investment by the government, which can take risks that purely commercial calculations cannot. Which sector is strategic would change over time, depending on circumstance and the economy’s degree of maturity. Steel was strategic once, but no longer. Satellites, however, continue to be.

Medicine

Scientists map body bacteria

American scientists have identified over 4,200 species of bacteria that live in various parts of a human body and mapped them into an atlas.
The researchers at the University of Colorado, Boulder, also found unexpectedly wide variations in bacterial communities from person to person.
"The goal is to find out what is normal for a healthy person, which will provide a baseline for further studies to look at people with diseased states," the research team said.
The study was based on an intensive analysis of the bacteria found at 27 separate sites on the bodies of nine healthy volunteers.
There are an estimated 100 trillion microbes living on or inside the human body and they are thought to play a key role in many physiological functions, including development of the immune system.

Sport

India to meet China in the final of Asia Cup women hockey

India will lock horns with China, who beat Japan by a solitary goal.
It was a double delight for the Indian women's hockey team as they edged out Korea 3-2 to sail into the Asia Cup final, which also assured them a berth in the 2010 World Cup in Argentina.

Ganguly back as KKR captain, Whatmore appointed coach

Former India captain Sourav Ganguly on Friday returned as the Kolkata Knight Riders' skipper for next year's Indian Premier League, replacing New Zealand's Brendon McCullum.
The controversy-ridden IPL outfit, which finished at the bottom of the table this year, also named Dav Whatmore as its new coach with Delhi Ranji coach Vijay Dahiya as his deputy.
Pakistani pace legend Wasim Akram was appointed the mentor of the side.

Language lessons

gainsay: Verb

Take exception to
eg: ...Yet, it cannot be gainsaid that it makes no sense to stall and put on the back-burner vital infrastructure projects simply due to unrealistic conditions.

pussyfoot: Verb

To go stealthily or furtively
eg: ...It would surely be transformative pan-India, after much policy pussy-footing.

bawl: Verb

Shout loudly and without restraint; Make a raucous noise; cry loudly

06.11.2009

ramkyc@gmail.com (Ramakrishna) — Sat, 07 Nov 2009 02:27:04 PST

Politics & the Nation

Maoists ready for talks, demand withdrawal of security forces

Faced with an impending security force operation, a top leader of the Maoists on Thursday said they were ready for talks with the Centre provided some of their conditions were met, including withdrawal of paramilitary forces deployed in Naxal-hit States.
Read more on it here.

Finance & Economy

Bold moves from government on divestment?

Prime Minister Manmohan Singh on Thursday put an end to the dillydallying on divestment in public sector companies by approving a plan to partsell shares in them that may help the cashstrapped government raise at least Rs 60,000 crore and reduce its dependence on market borrowings to fund the building of roads, hospitals and schools.
Investors cheered the decision, interpreting it as a sign the government was returning to the path of bold economic reforms that could help contain the strain on its finances, after it cut taxes and raised spending in the last year to contain the damage arising out of the global credit crisis.
A subtle change in the way the divestment proceeds are to be used?
Although government-owned companies such as NTPC and Power-Grid have sold shares in the past few years under Mr Singh, they could not be used to fund government expenditure as they were kept aside in the National Investment Fund for welfare schemes and to bail out public sector companies.
The government has reportedly now decided against parking the divestment proceeds in the NIF.
Close to Rs 5,000 crore that the government raised through divestment of its stake in NHPC and Oil India will now be going into capital expenditure on social sector schemes determined by Planning Commission and the department of expenditure.
Use of disinvestment proceeds would free up government resources to that extent or bring down its fiscal deficit in line with the targets set in Budget 2009-10. The government targets fiscal deficit at 5.5% in 2010-11 and 4% in 2011-12.
But Trinamool and DMK are obviously unhappy with the decision. Their stated position is very well known. Both of them oppose divestment in PSUs. Whether Congress can weather this opposition this time remains to be seen.

Is another revolution in the offing?

This revolution is about investing in mutual funds. This report says that SEBI is toying with the idea of doing away with entry loads in mutual fund investing for investors. If can bring that about, that would be a real revolutionary effort.
Do read the story in full.

We are sure you all know a bit or two about carry trade by now.

If you do not, then it is time for you to read this article that appeared in ET today and get a lowdown on it.
Carry trade is considered very risky. Why?
Firstly, history shows that carry trade is risky. Remember the LTCM debacle of 1998? Such events lead to very wild fluctuations in currencies which makes carry trade highly risky.
Secondly, carry trades can go from profit to loss with almost no warning.
Thirdly, if there is no forex intervention and foreign currencies appreciate, the negative borrowing cost of the carry trade becomes more negative. If intervention or open market operations control currency appreciation, the ensuing domestic monetary easing feeds an asset bubble in these destination economies. So the perfectly correlated bubble across all global asset classes gets bigger and frothier by the day.
Fourthly, many asset prices now seem to be extremely dependent on the glut of cheap liquidity that comes from the dollar carry trade. The implication is that if the dollar rises and carry traders bail out of their assets again, we’ll probably see another sharp global sell-off in all assets.

On India's inward remittances

Globally, India is the largest recipient of inward remittances which is effected through money transfer agents and banks. Banks take around a day to a month, depending on the choice of service.

Medicine

New therapy eradicates cancer cells without targeting healthy ones

Researchers are close to developing a cancer treatment that kills malignant cells whilst leaving healthy cells untouched.
Led by Professor Cohen-Armon of Tel-Aviv University, the researchers found that potent phenanthridine derived polyADP-ribose polymerase (PARP) inhibitors efficiently eradicate MCF-7 and MDA231 breast cancer cells without impairing normal proliferating cells, such as human epithelial cells (MCF-10A), nor normal non-proliferating cells, such as neurons and cardiomyocytes.
PARP inhibitors were originally designed to protect cells from cell-death under stress conditions (e.g. stroke or inflammation).
Read more about it here.

Sport

What a loss?

It was a sad day for India. In spite of a brilliant knock by Tendulkar, the team somehow couldn't just manage to win. It loses by a paltry 4 runs!!
Let us wish them well for their next match.

Language lessons

apothecary: Noun

A health professional trained in the art of preparing and dispensing drugs

vicissitude: Noun

A variation in circumstances or fortune at different times in your life or in the development of something; Mutability in life or nature (especially successive alternation from one condition to another)

explicate: Verb

Make plain and comprehensible; Elaborate, as of theories and hypotheses

panoply: Noun

A complete and impressive array
eg: ...So proactive policy for the latter would have beneficial effects and spillovers across a panoply of sectors as varied as energy systems, value-added plastics and information technology.

05.11.2009

ramkyc@gmail.com (Ramakrishna) — Thu, 05 Nov 2009 02:01:04 PST

Politics & the Nation

The Reliance brothers dispute before the Supreme Court takes a sudden turn; one of the judges in the SC recuses himself from hearing the case

All of you might be aware of the ongoing dispute regarding the division of KG basin gas between the two Reliance brothers, before the Supreme Court.
Yesterday, all of a sudden, one of the judges hearing the case viz., Justice R.V. Raveendran recused himself from hearing the case. He had done so when he came to know that the legal firm (AZB) in which his daughter is working is advising one of the parties (RIL) in the case being heard by him.
However, the law firm has nothing to do with the current case, Justice Raveendran clarified.

LeT targets National Defence College

That the Lashker-e-Taiba is plotting overtime to hit India and among the targets could be the country’s leading boarding schools located in Uttarakhand, the National Defence College, Delhi was uncovered during an interrogation of arrested US national and LeT recruit David Coleman Headley by FBI.
LeT believes this would give them wide coverage in the international media.

Finance & Economy

Finance Ministry comes to the rescue of ADA Group for raising ECBs abroad

Take a look at this graphic which gives the issue in brief. It is self explanatory.

Credit growth shrinks

According to the latest figures released by the Reserve Bank of India, total loans, including food credit and non-food credit amounted to Rs 28,68,565 crore as on October 23. Both food credit and non-food credit dipped during the fortnight by Rs 6,708 crore and Rs 15,401crore, respectively. While food credit includes loans to Food Corporation of India for foodgrain procurement, nonfood credit consists of loans to farmers, individuals as well as businesses.
On a year-on-year (y-o-y) basis, growth in nonfood credit works out to 10.31% as compared to 29% growth seen in the previous year. Many large banks have pruned their loan growth targets for the year, after the RBI pruned its projection for credit growth to 18% in its quarterly review of monetary policy last week from 20% earlier.

Don't backtrack on financial sector reforms, says Montek Singh Ahluwalia

The Planning Commission Deputy Chairman was cautioning the country against slowing down on financial sector reforms. He feels that there is no need to be too fearful about the negative impact of the global financial crisis on India and that the country should not shy away from proceeding ahead with reform agenda. Some snippets of info worthy our attention in this context:
Foreign direct investment in the first half of the 2009-10 (April-September) stood at over $15 billion, almost equivalent to portfolio investments in the same period.
There is an ongoing debate in the government on the pace of economic reforms in the back-drop of the global financial melt-down that affected the more liberalised Western world more than the relatively conservative economies like India.

Should banks get into insurance business?

This question is discussed at great length in this piece that appeared in ET today. A very good one. A must read.

India's totalisation agreements

It has five social security agreements or ‘totalisation agreements’, with Belgium, Germany, France, Switzerland and Luxembourg. Totalisation is the process of mutual agreement by two national governments to avoid guest workers paying social security contributions in both the home and host countries, adding, in most cases, to their employers’ costs.

International

Should Israel be tried for crimes against humanity? In its recent war on Gaza?

The war on Gaza, called Operation Cast Lead, left more than 1,200 Palestinians — including scores of children — dead, and devastated the insanely overcrowded, impoverished strip. Afterwards, given the outcry, the United Nations Human Rights Council called for an investigation. And Richard Goldstone, a South African judge, agreed to lead it. His report, which accused Israel of waging war on the entire population of Gaza, led to angry denunciations and predictable rejection from the Zionist regime. It is probable, given its habitual practice, that Israel could have labelled the judge and the report anti-semitic. Except for the fact that the man happens to be a Jew and a self-confessed Zionist at that! And one who led investigations into genocides both in the former Yugoslavia and in Rwanda, and whose stated objective was to evaluate Gaza on humanitarian law.
This brings us back to the question -- should Israel be tried before the International Court of Justice?
Take a look at this thought provoking piece that appeared in today's ET. The above is an extract from it. It does raise some questions.

Environment

On waste management

The Manufacturers Association for Information Technology estimates that India itself generated about 330,000 tonnes of e-waste last year, besides illegally importing an additional 50,000 tonnes.
An international convention on management of waste is the Basle Convention (1989) on trans-frontier movement of waste. The convention allows wastes which can be recycled.
The UN Conference on Environment and Development in Rio de Janeiro in 1992 accepted two broad principles:

One is the 'polluter pays' principle. The other is on internalisation of environmental costs of production.

Money from waste

Today, many entrepreneurs are busy collecting the trash and converting it into cash.
For example, the Chennai-based Gupta Group with an annual turnover of Rs 225 crore has been processing discarded human hair — a $1 billion market — and exporting it since 1974 to Korea, Italy and China. A Mumbai start-up, Sustainable Technologies and Environmental Projects uses a thermal catalytic conversion method, ‘polycrack’, to convert plastic and organic waste like kitchen, animal and agro refuse into petroleum fuels. A company in Noida ships PCBs to Belgium, Japan and Malaysia for metal extraction and the wires to Singapore. The department of chemical engineering at Jadavpur University extracts dyes from waste flowers for use in the textile industry and for bio-fertilisers. The Mumbai-based Rs 110-crore Gujarat Reclaim and Rubber Products recycles old rubber from tyres. Style Solutions at Manesar, near Gurgaon, processes slaughterhouse waste into raw material for medicines, aquatic and poultry feed, pet food and fertilisers. Sugarcane stalks called bagasse produces steam and electricity. Likewise, methane generated by municipal solid waste produces energy.

Obituary: Claude Levi Strauss

This French anthropologist who transformed Western understanding of what was once called “primitive man” and who towered over the French intellectual scene in the 1960s and ’70s, has died at 100.
A powerful thinker, he became an avatar of “structuralism,” a school of thought in which universal “structures” were believed to underlie all human activity, giving shape to seemingly disparate cultures and creations.
Mythologiques, his four-volume work about the structure of native mythology in the Americas, attempts nothing less than an interpretation of the world of culture and custom, shaped by analysis of several hundred myths of little-known tribes and traditions. The volumes — The Raw and the Cooked, From Honey to Ashes, The Origin of Table Mannersand The Naked Man, published from 1964 to 1971 — challenge the reader with their complex interweaving of theme and detail.
His interpretations of North and South American myths were pivotal in changing Western thinking about so-called primitive societies.

Language lessons

corpulent: Adjective

Excessively fat
eg: If once upon a time, policemen were invariably portrayed as earnest upright men with clipped moustaches, today they are usually depicted as corpulent and corrupt...

lasicvious: Adjective

Driven by lust; preoccupied with or exhibiting lustful desires

doctrinaire: Noun

A stubborn person of arbitrary or arrogant opinions

hoi polloi: Noun

The common people generally

04.11.2009

ramkyc@gmail.com (Ramakrishna) — Wed, 04 Nov 2009 02:25:01 PST

Politics & the Nation

Jamiat asks Muslims to shun TV, cinema and anti-AIDS campaign among others

Recommend a read of this news story that appeared in today's ET. Look at the edicts that are passed by the Jamiat Ulema-i-Hind, the country's leading Islamic body.

Alarming poverty in South Asia

Over 300 million children in South Asia, almost half the total number, suffer from chronic levels of poverty, a latest UN report has found.
Unlike any other region in the world, due to persistent and deep inequalities in South Asia, children in the region are trapped in an unrelenting cycle of discrimination at several levels.
UNICEF is proposing a shift in the definition of poverty from being income specific to factors of deprivation and well-being, which can lead to more comprehensive policy responses.

Finance & Economy

RBI chips in for bringing clarification on foreign investment guidelines

Laying down foreign investment guidelines is in the domain of DIPP - Department of Industrial Policy & Promotion.
Under the new guidelines, which were issued in February, all direct and indirect overseas investments were counted as foreign investment, putting the foreign ownership of ICICI Bank at 65% and HDFC at 74%. The guidelines have created confusion and led to concerns that it could allow indirect foreign entry into forbidden sectors such as multi-brand retail through layered corporate arrangements where the initial foreign investment is kept below 50%.
ICICI Bank operates a life insurance JV with Prudential of the UK and a general insurance business with Lombard of Canada. HDFC has partnered Standard Life and Germany’s ERGO. Both ICICI and HDFC have been fearing that these guidelines will create hurdles for them.
Now the RBI has reportedly written to the government saying that control of a company, not just its ownership, should be taken into account while determining foreign investment, particularly in the financial services sector. Such an interpretation will mean that investments by ICICI Bank and HDFC, both majority foreign-owned but controlled by Indians, will be regarded as domestic investment. This will enable them to retain their investments in their businesses in insurance, a sector where foreign ownership is capped at 26%.

RBI buys gold from IMF

In a reverse of the situation that prevailed back in 1991 when it had to pawn its gold reserves with Bank of England and Bank of Switzerland to get the much needed US dollars, the RBI has bought about 200 tonnes of gold from the IMF for about $ 7 bn.
For a fair commentary on the move, read today's ET editorial on the subject. It is here.
But a few snippets that are worth our attention:

Total central bank holdings of gold is around 30,000 tonnes, the same level as 60 years ago, over which period world output has grown some 13 times.
For many year’s the central bank gold holdings remained constant at about 11.5 million troy ounce accounting for 4% its reserves worth $285 billion now.
The recent purchase of close to 6.5 million troy ounce would raise the share of gold in India’s foreign exchange reserves to about 6%.
In its official release, IMF has said that the total sales proceeds are equivalent to US$ 6.7 billion or SDR 4.2 billion.

BTW do you know the difference between an ounce and a troy ounce?

1 oz(troy) = 31.1034 gms
1 ounce = 28.35 gms

An excellent article on competition law that is peppered with some great thoughts.

Take a look. We think you should preserve a copy of this for future reference.
Some quotable quotes from this article:

“A lawyer who has not studied economics is very apt to become a public enemy” - Justice Brandeis of the US Supreme Court
“Words have sometimes to be harsh since they represent an assault on the thought of the unthinking" Lork Keynes.

Science & Technology

Are you an IITian? Or a BITsian?

If so, compare your thoughts and dreams with this one that appeared in today's ET. We are sure, many of you will follow the lead and come up with bigger dreams. We surely are going to read and learn more about this dream as well as yours.
It's all about a path-breaking technology that is tentatively being called Sixth Sense.

Language lessons

cummberbund: Noun

A broad pleated sash worn as formal dress with a dinner jacket

kilter: Noun

In working order

slouching: Verb

Assume a drooping posture or carriage; Walk slovenly

slovenly: Adjective

Negligent of neatness especially in dress and person; habitually dirty and unkempt

03.11.2009

ramkyc@gmail.com (Ramakrishna) — Tue, 03 Nov 2009 03:24:03 PST

Politics & the Nation

Supreme Court Judges declare their assets

Take a look at this story. Makes an interesting reading.

Should better facilities in trains be targeted only at foreigners?

NO, argues today's ET editorial on the subject. Take a look.
Some snippets from it that are worth our attention:
A measly five million foreign tourists come annually to India compared to China’s 52 million.
In contrast, some 500 million Indians tourists travel domestically each year by our trains.

Finance & Economy

India saves the day for auto biggies

It is sales in India that have come to the rescue of auto majors across the world. Though our market is still very small compared with that of China, the growth rates recorded here are cause for celebrations.
Sales of cars and utility vehicles in India are expected to be around 1.8 million units for the year ended March 31, 2010. Despite the brisk growth rate in India, they palled compared to the eye-popping 9.6 million units sold in the first nine months of 2009 in China.
The sharp contraction of consumer demand in the US, post the global meltdown, has propelled China into the position of the world’s largest automobile market.
Take a look at this graphic.

BRICS:Goldman Sachs :: Indian Paradox:?

Answer: Christopher Wood.
More on him. The 52-year-old former journalist with The Economist presided over the most celebrated research reports on Indian equity investments way back in 2003 called ‘The Indian Paradox’. Many at that time did not believe the report, which talked about demography-driven domestic demand in the country. But now, Wood and his team’s research is much-sought after by investors.
Wood, also publishes a weekly newsletter called Greed & Fear. He is gungho on India story. He certifies our RBI as the 'best central bank in the world.'
He is the view that Indian equities can trade at two or three times the multiple of S&P's 500 i.e., at about 20-30 times earnings. Indian shares are trading at 19 times their earnings forecast for the fiscal year ending March 2010.

India Inc is reportedly sitting on large piles of cash

Why did they pile up? What are the implications of this?
The economic environment in 2008 was a perfect recipe to strain Indian companies, but as it turns out, they were preparing for an economic turmoil for some time. The main source was internal accruals and timely fund-raising from sale of shares and bonds.
A look at the cash flow statements suggests that they seem to be waiting for the rainy day. In FY09, for instance, despite the availability of internal accruals, they were seen raising.
Shareholders, including the government, are better off, if a part of the cash is distributed as special dividends.
Huge cash on hand may appear to be a good corporate strategy. But it squeezes a few return ratios.
It depresses the return on net worth and return on capital employed (RoCE), reducing their valuations on stock market. This is because companies rarely earn more than 9%, while RoCE in their core operations may be above 30% per annum.

Language lessons

adumbration: Noun

The act of providing vague advance indications; representing beforehand; A sketchy or imperfect or faint representation
eg: 'No nation was ever ruined by trade,’ penned the statesman also known for kite-flying the notion of lightning conductors. It’s notable adumbration of what in today’s parlance can be termed trade openness.

epergne: Noun

A large table centerpiece with branching holders for fruit or sweets or flowers

naff: Adjective

In bad taste; vulgar; out of fashion; poor quality
eg: If you want to show off, you don’t need a naff outsize invitation or even sillier theme party that event planners in India spend so much on.

02.11.2009

ramkyc@gmail.com (Ramakrishna) — Mon, 02 Nov 2009 01:21:12 PST

Politics & the Nation

How will the price war in telecom pan out?

Take a look at this graphic for a good insight.

Pakistan and India need more and more Rukhsanas to tame terrorism

If only there are more Rukhsanas, both countries could be rid of terrorists. Take a look at this story of a brave girl! All the best wishes to her and her heroism.

Environment

Cell phone waste is the next big threat to environment
A whopping 8,000 tonnes of cell phone waste is estimated to burden the earth by 2012, according to a study by Delotte. There is a growing need to better manage the rising cell phone waste, as it is posing a threat to the environment.
The Deloitte report stated that mobile phone waste globally is expected to grow at a compounded annual growth rate (CAGR) of about nine per cent between 2008 and 2012, with more than 80 per cent of the cell phone waste being hazardous.
Elaborating on the ways to minimise the growing cell phone waste, the report stated that recycling and refurbishing of used cell phones is necessary.
Refurbishing extends the lifetime of used phones and recycling reduces the need for the raw materials used to make new products. The inclusion of recycling or refurbishing would change the traditional view of the cell phone life cycle.

Finance & Economy

Reliance to foray into education?

If reports/rumours are to be believed, RIL will be foraying into the education space .
According to an IDFC-SSKI report, Indians spend $50 billion annually on private education. The four segments of the education market — plus two, higher, vocational and supplemental — present a $80-billion opportunity by 2012. It is expected to grow at a CAGR of 16%, says a CLSA Pacific study.
Private equity and venture capital investors have made over 30 investments worth $300 million in the recent years, though, a fourth of these investments (in value terms) have gone to e-learning.
The existing rules restrict ownership of schools to trusts and no-profit bodies. While fees are not restricted, regulations come in the way of distribution of dividends or investment of surplus money in setting up schools.
The government is reportedly moving in the direction of deregulation of the sector.
An E&Y-Ficci report says India has a gross enrollment ratio (GER) of only 11% in higher education compared to about 60% in the US and Canada, and around 21% (average) in the BRIC countries. The higher education institutions (HEIs) in India can accommodate only 7-8% of the country’s college-age students.

Reforming the DGH (Directorate General of Hydrocarbons)

With the laying down of office by the present DGH Mr. VK Sibal amid some controversial circumstances, calls for sprucing up the DGH and redefining its role have made their appearance.
In 1993, when it was formed out of the resolution of the ministry of petroleum and natural gas, it was supposed to be the institution that is created as an 'independent regulatory body.' But remained far from independent and in fact its role was reduced to that of 'assisting the government' in both contractual and technical matters.
In 2001, the Naresh Narad Committee examined the need for setting up of an upstream hydrocarbon regulatory authority. Though, it recognised the need to distance regulation from government, it was not unanimous on DGH’s role. Later, the possibility of authorising common jurisdiction with the downstream regulator (Petroleum & Natural Gas Regulatory Board) was also discussed.
At present, there is no statutory upstream regulator. But DGH acts as one, de facto.
Historically, Dasgupta Committee (1991) envisaged reservoir management as the essential function of a regulator. Kaul Committee (1992) added leasing development conservation.

Government gives priority to educaitonal loans

Getting an education loan may become easier. The government plans to cushion public sector banks against any default on education loans, the primary reason why PSBs are often reluctant to give out such loans that does not have enough guarantee.
The government plans to protect education loans under a new credit guarantee scheme and has already asked the Indian Banks’ Association (IBA) to formulate a draft proposal, said a senior official with the finance ministry.
Due to a sharp increase in education loan offtake to Rs 32,460 crore, which is largely unsecured loan (without any collateral), senior officials of public sector banks have expressed apprehension that such a large loan component might impact the strength of the banks, particularly in case of default, as these loans are not backed by collateral.
The total outstanding education loans of public sector banks as on March 2009 were Rs 27,646 crore, a 39.51% increase from Rs 19,817 crore.

International

On regional trade agreements

The mavens mention that as many as 400 RTAs have been notified worldwide, although about 200 are actually operational.

Sport

Serena wins against her sister Venus

Serena Williams bested big sister Venus again on Sunday, winning 6-2, 7-6 (4) in the season-ending Sony Ericsson Championships final at Doha.
It was Serena’s fourth straight win over her sister. She also beat Venus in the round-robin stage of the Doha tournament, the Wimbledon final and the semifinals in Miami this year.

Delhi Half Marathon results

Olympian Deriba Merga of Ethiopia defended the men’s title, while Kenyan Mary Keitany won in the women’s category of the Airtel Delhi Half Marathon yesterday.
Merga, who faced some stiff competition from compatriot Eshetu Wendimu and last year’s runner-up Wilson Kipsang of Kenya, clocked 59:54 minutes to cover the 21.097 km and bagged USD 25,000 winners’ purse.
Reigning world champion Keitany took 1 hour 6.54 minutes to touch the finish line.
Armyman Deepchand Saharan (1.04:00) finished first among Indian men and overall 17th in the race, while Uttar Pradesh’s Sukanya Mall (1.20:11) was the fastest woman among Indians and 22nd overall.
Each of the Indian toppers would be richer by USD 4,000.

Language lessons

gratuitously: Adverb

In an uncalled-for manner

gratuitous: Adjective

Without cause; costing nothing; unnecessary and unwarranted

calypso: Noun

A type of music and dance that originated in the West Indies (probably Trinidad), a ballad is characterized by improvised lyrics on topical or broadly humorous subjects, often creating satire of current events.
eg: Others could quote the calypso which goes: “Old Methuselah was 900 years old/Older than anyone the world has known/One day he thought he’d have some fun/The poor old man never lived to be 901”.

jibe: Noun

An aggressive remark directed at a person like a missile and intended to have a telling effect

vibe: Noun

A distinctive emotional aura experienced instinctively
eg: "it gave me a nostalgic vibe"

31.10.2009

ramkyc@gmail.com (Ramakrishna) — Sat, 31 Oct 2009 02:59:39 PDT

Politics & the Nation

Indian American appointed to a key post in US

Suresh Kumar, who served as a special adviser to the Clinton foundation and was a news anchor in India from 1970 to 1985, has been appointed to a key administration post by President Barack Obama.
Kumar, known for his expertise of public-private partnership, has been nominated by Obama as Assistant Secretary of Commerce and Director General of the United States and Foreign Commercial Service in the US Department of Commerce.

Finance & Economy

Take a peep into lawyers' fees and incomes

You will surely be startled. You will be left wondering whether you made a wrong choice sometime back.

How big a hole will the IOC depot fire in Jaipur in the insurance companies' books?

Estimates are putting the claim to be a full claim. Meaning that the claim will be filed for the entire facility. It is expected to be around Rs. 230 crores. But what is remaining beyond estimations for the present is the collateral property damage that the fire would have caused for others. The extent of such losses will be known only after some time.
To get a picture of the issue read this story.

Science & Technology

Anil Kakodkar to demit office

Atomic Energy Commission (AEC) Chairman, Anil Kakodkar, will demit office on 30th November.
Kakodkar will also retire from the post of Secretary, Department of Atomic Energy (DAE) on the same day, when his term ends.
Kakodkar took over as Chairman, AEC from Dr R Chidambaram in November 2000 and was the first chairman to get three extensions in 2003, 2005 and 2007 in the history of India's nuclear programme.

Sport

Jeev Milkha Sing's record

Jeev Milkha Singh reaches another golfing milestone in his illustrious career as he becomes the first Indian to tee up at the 16-man World Matchplay Championships in Casares, Spain.
The reigning Asian Tour No 1 conceded his ankle injury has not healed yet but sounded confident of making it to the semifinal.

India seeded VI in World Cup T20

India have been seeded 6th in next year's Twenty20 WC in the West Indies and will open their campaign on 1st May. India got a relatively easy first round as they have been placed in Group C along with South Africa and a qualifying team yet to be decided.
Defending champions Pakistan have got the top billing in the event followed by Sri Lanka and South Africa.
Hosts West Indies are seeded fourth, while England occupy the fifth place.

Language lessons

wallop

Noun: A forceful consequence; a strong effect; A severe blow
Verb: Hit hard; Defeat soundly and utterly
eg: "Modi wallops Dhoni, Sachin on tax charts"

throw out the baby with the bathwater: Idiom

to lose the good parts when you get rid of the bad parts of something
eg: You can't close the airport because one airline has problems - that's just throwing out the baby with the bath water.

30.10.2009

ramkyc@gmail.com (Ramakrishna) — Fri, 30 Oct 2009 03:09:57 PDT

Finance & Economy

Why would a rising US economy mean a fall in the value of the dollar?

Restored confidence would reverse the flight to safety in the wake of the Lehman collapse in September 2008. The funds that had fled emerging and other markets to take refuge back home in the US in a bid to minimise uncertainty are now likely to retrace their steps back to markets where the returns are higher. Just as the influx to safety had driven up the dollar, the funds’ redeployment across the globe would drive down the dollar.

On resident and non-resident asset holdings

It is an article that gives some interesting interpretation to the FEMA. Take a look. For our purpose it may suffice to note the following two points:
Sections 4 and 8 of Foreign Exchange Management Act (FEMA) don’t apply to them. They apply only to residents. These provisions impose restrictions on residents to acquire, hold, own, possess and transfer foreign assets, and require them to repatriate the proceeds of foreign assets to India.
Even residents can now freely maintain and operate foreign assets. For example, a resident can freely hold, own, transfer and invest foreign assets provided these were acquired or held or owned when he was a non-resident. This follows from Section 6 (4) of FEMA.

CCI frowns prepayment penalties by banks?

The Competition Commission of India is reportedly not happy with the way prepayment penalties are being levied on borrowers by financial institutions.
Let us get a peek into why the penalties are levied in the first place:
The business of a bank/ financial institution involves borrowing and lending and in the process the lending institution tries to run a matched balance sheet of assets and liabilities. Prepayments are essentially accelerated payments before the schedule. Any prepayment will disturb the assetliability match and in order to mitigate the negative impact of the prepayments the institutions/banks charge a prepayment charge. Everytime when there is a prepayment from the borrowers it will not be feasible for the banks to prepay its lenders as its loan agreement with lenders may either not permit it or permit it only with certain charges, notice period and may be subject to other conditions.

Centre not to force states to slash tax on imported spirits

You might remember that we noted about this issue as far back as 3rd June 2007
Now it is reported that EU may take India to WTO if it fails to bring down taxes in some states.
According to the European Union, Maharashtra, Karnataka, Andhra Pradesh and Tamil Nadu have imposed local levies on imported liquor, which are much higher than those levied on locally produced liquor. This violates the WTO rule of national treatment that lays down that once imported, foreign products should be treated the same as domestically produced goods.
As per EU calculations, incidences of taxes on foreign liquor are as high as 200%-790% of the sale price, depending on the type of liquor and its price and also the state in which it is being sold. The four states identified by the EU as the ones applying high taxes, together account for more than half of India’s consumption of wines and spirits. In 2008, EU’s export of wine to India totalled € 8 million while its export of spirits was to the tune of 52 million euros.

International

US out of recession ahoy!

THE US economy returned to growth in the third quarter after a year long contraction as government incentives spurred consumers to spend more on homes and cars. The world’s largest economy expanded at 3.5% from July through September. Household purchases climbed 3.4%, the most in two years.
Policy makers will now focus on whether the recovery, supported by government spending and tax credits, can be sustained into 2010 and generate jobs. The record $1.4 trillion budget deficit means President Barack Obama has little room for manoeuvre as he tries to keep unemployment from rising above 10%, while Federal Reserve policy makers wind down emergency programmes in a bid to prevent a surge in inflation.
Since the recession began in December 2007, the US has lost 7.2 million jobs. Payroll cuts peaked at 741,000 in January before falling to 263,000 job losses in September. The economy will likely grow at a 2.4% annual rate from October through December. GDP will also grow 2.4% next year and 2.8% in 2011, compared with an average of 3.4% growth over the past six decades.
What does the recovery in US economy mean for India? Take a look at the expert-speak.

Language lessons

Real McCoy: Idiom

It is used throughout much of the English-speaking world to mean "the real thing" or "the genuine article" e.g., "he's the real McCoy". It is a corruption of the Scots "The real MacKay", first recorded in 1856 as: "A drappie o’ the real MacKay," (A drop of the real MacKay), and this is widely accepted as the origin.
eg: The United States surprised the world with strong growth between July and September, but a wary India is waiting to see if the recovery is the Real McCoy.

hubble-bubble: Noun

An oriental tobacco pipe with a long flexible tube connected to a container where the smoke is cooled by passing through water

29.10.2009

ramkyc@gmail.com (Ramakrishna) — Thu, 29 Oct 2009 19:58:55 PDT

Politics & the Nation

Indians get a place of pride within Microsoft

Read this story; it's really heart-warming. This is the stuff that dreams should be made of for the average Indian techie.
All the best wishes from all of us here for those in the reckoning to be at the top within Microsoft.

On Udham Singh

How many of you remember him? From the annals of our modern history.
For those of you with Indian History as an optional, perhaps he would not be a stranger. But for others, perhaps he is.
In short he is the guy who killed Michael O'Dwyer in 1940, for the latter was the Governor of Punjab when the Jallianwallah Bagh massacre took place in 1919. The killing was retribution for his role in imposing martial law and defending the perpetrators of the Jallianwalla Bagh killings at the end of the First World War, carried out almost exactly twenty one years later.
Take a look at this interesting story that appeared in today's ET about him.

Finance & Economy

India tops global confidence charts

Global consumer confidence is rebounding, and in the US has risen for the first time since 2007, amid signs the world economy is picking up although spending is still restrained, according to a survey conducted by The Neilson Company.
Confidence was highest in India, followed by Indonesia and Norway, and was weakest in Japan, Latvia, Portugal and South Korea, although in Korea it had improved markedly.
Take a look at this graphic.

Gas based power generation goes up by a decent 35%

Gas-based power plants in the country have seen over 35% increase in power generation during the first half of the financial year over the year-ago period, buoyed by the flow of gas from Krishna Godavari (KG) basin from April this year.
Power from gas-based plants has contributed to nearly 13% of total power produced in the country during this period, against 9.5% last year.
The additional power generation by gas-based units corresponds to the consumption of about 16 mmscmd of gas.
Due to better supply of gas, a number of new gas-based power plants, with total capacity of 1800 mw, have also been commissioned in the last six months.
The aggregate capacity utilisation of the gas-based units measured in the form of plant load factor (PLF) shot up to 66.7% for the first half, compared to 55.7% during the year-ago period. Private sector companies, which account for a third of total 16,500 mw of gas-based generation capacity, have seen a higher increase in capacity utilisation as compared to the state owned firms such as NTPC.
All this surely augurs well for the country.

Foreign currency inflows encouraging

In the first six months of the fiscal, India received $14 billion in foreign direct investment (FDI), in line with government expectations. Total FDI inflow was $34.9 billion in 2008-09.
Foreign institutional investments, which were negative in the last fiscal, reached $15 billion in the first six months of the current fiscal.
In 2007, India put limits on external commercial borrowings and curbed the use of participatory notes to invest in the stock market as part of measures to stem the inflow of foreign capital. External borrowing rules were later relaxed but a sharp and sudden surge in capital inflow may tempt the government to review them again.

Science & Technology

Demand for nuclear power engineers way up

In the context of India aiming at adding about 20,000 MW nuclear power generation capacity by 2020, there is a huge demand for nuclear power engineers. But these engineers are not easy to come by. The Indian engineering institutes are not well prepared to supply the kind of required numbers. It is said that the industry norm is a requirement of 1 to 1.4 person per MW.
Currently, the number of specialist nuclear post-graduates and PhDs from IITs and other universities is only about 50 people every year. In addition, Nuclear Power Corporation of India (NPCIL), the sole nuclear power generator in the country, has a capacity to train 250 people annually, while the department of atomic energy schools around 500-700 people every year.
The attrition in this sector is the lowest at about 3-5%, while it is as high as 10-12% in other streams of engineering.

Leisure/Travel/Archaeology

Machu Picchu (meaning: Old Mountain) in Peru

This is an Inca citadel wherein the remains of complex agricultural terraces, workers’ huts, noblemen’s homes, sacred temples and scientific instruments survive. This has miraculously survived the onslaught of the marauding Spanish conquistadors of the 16th century.
Incas' is a civilisation that had stretched in its heyday to Bolivia, Chile, Ecuador and to the borders of Argentina and Brazil.
The site was first uncovered in 1911 by an American scholar-explorer, Hiram Bingham. But Bingham didn’t know he had found Machu Picchu: he thought it was Vilcabamba, final refuge of the Incas against the Spanish invaders.
Take a look at some of the photographs of this beautiful place here.

Sport

Agassi admits to drug use

Read this story in The Hindu about it. What a pity?

Language lessons

alcove: Noun

A small recess opening off a larger room

hacienda: Noun

A large estate in Spanish-speaking countries; The main house on a ranch or large estate

trilby: Noun

A hat made of felt with a creased crown

28.10.2009

ramkyc@gmail.com (Ramakrishna) — Wed, 28 Oct 2009 04:00:16 PDT

Finance & Economy

The beginning of the end of easy money policy

Reserve Bank governor Duvvuri Subbarao on Tuesday ended the soft monetary policy — aimed at easing the credit crisis that kicked in last year — as he began the exit by withdrawing liquidity boosting measures, becoming the third central banker in the world to do so after Australia and Israel. An increase in lending rates is now imminent next quarter if consumer and asset prices remain high. Benchmark rates were, however, kept unchanged.
The governor withdrew a special facility making available funds from banks to mutual funds and finance companies, made it more expensive to lend to commercial real estate, forced banks to invest more in government bonds and asked lenders to set aside more funds for bad loans. The special facility was introduced last year to boost liquidity for firms in the financial sector after the credit markets froze.
RBI maintained the repurchase rate or repo rate — the rate at which the central bank provides funds to banks — at 4.75%; the reverse repo rate — the rate at which it takes funds from banks — at 3.25%, and the cash reserve ratio — the slice of deposits that banks have to mandatorily park with the central bank — at 5%.
But the central bank surprised the market in its choice of instruments to announce the exit of an easy money policy. The statutory liquidity ratio (SLR), which prescribes the percentage of deposits that banks are required to invest in government debt, has been raised from 24% to 25%, which Mr Subbarao said was a reversal of an exceptional measure. Last year, at the height of the global credit crisis, the central bank had lowered the SLR to ease credit flow to industry.
The apex bank also raised its forecast of inflation as measured by the wholesale price index to 6.5% by March 2010, from 5% earlier, as food prices continue to rise on short supply due to the worst-ever monsoon rains in more than a quarter of a century.
The RBI has introduced new financial instruments, which would fill the gaps in hedging needs and make the debt market thicker and more mature. They include floating rate bonds, repos on corporate bonds, credit default swaps, STRIPS, forex futures for currencies other than the dollar and some more.
It also contributed to the cause of financial inclusion by expanding the eligibility for becoming a banking correspondent and allowing banks to collect service charges.

Excise duty reductions to be rolled back?

The finance ministry is reportedly exploring the possibility of a partial year-end rollback of the excise duty cuts doled out earlier in a bid to boost collections from this tax, which have been sharply lower in the first six months of the current fiscal.
The rate increase looks feasible because of the large unused cenvat credit available with industry. The manufacturing industry can offset the higher excise duty against the available cenvat credit, ensuring that greater excise levy does not cause prices to increase and thereby affect the economic recovery underway.
The government had halved the cenvat rate from 16% to 8% in stages beginning budget 2008-09 as part of the measures to stimulate demand after the global financial crisis caused hiccups in the Indian economy. Cenvat rate is the median rate of excise duty, levied on nearly 90% of manufactured goods.

Country's DGH denied extension; new DGH to take over soon

OIL India director (operations) and former deputy director general in the Directorate General of Hydrocarbon (DGH), SK Srivastava, is likely to replace the controversial chief custodian of country’s oil and gas assets, VK Sibal. The change has been necessitated following the oil ministry’s refusal to extend Mr Sibal’s tenure. The incumbent DG has been in the news for his alleged proximity to a private oil firm and the connection is being probed by the Central Bureau of Investigation (CBI).
Oil ministry had earlier recommended a two-year extension to Mr Sibal till his superannuation from Oil India in January 2012 after his fiveyear contract as DG was coming to an end on October 31. The recommendation, however, required mandatory clearance by the Central Vigilance Commission (CVC), the top agency to prevent of corruption in the public services. Upon an investigation, CVC found prima facie evidence that Mr Sibal took undue favours from a private oil company and asked CBI to probe it further.
The government established DGH in 1993 to act as an upstream advisor and technical regulator. Its prime function is to manage country’s hydrocarbon resources.

Restrictions on loan securitisation

You might remember what we noted on the subject on 22.10.2009. Compare that with what is reported today below:
Banks now have to wait for a year before they can splice loans into marketable securities and sell them to prospective investors. Originators of securitised debt will also have to retain a tenth of the total assets securitised, as part of the central bank’s objective to bring greater transparency to the market.
In securitisation, the originator bank repackages loans in the form of marketable securities. These are in the form of pass through certificates (PTCs) — like bonds — issued by a special purpose vehicle (SPV) holding the loan. An investor in securitised debt is typically the one who aspires for higher returns and has a stomach for higher risks associated with a loan.
ICICI Bank, Kotak Mahindra Bank, Yes Bank, Citi and Standard Chartered are some of the key banks active in the segment.
Market estimates place the size of the securitised debt market at close to Rs 40,000 crore in fiscal 2009.

Entertainment

Jackson's "This is it" opens to big draws.

Are you a Michael Jackson fan? If so, you should not miss this news report on the subject. We love Jackson as well as Madonna; and are never tired of comparing their long but divergent music careers. We love them both in equal measure for what they are. Both of them are greats in their own ways.

Language lessons

hornet's nest: Noun

A highly contentious or hazardous situation
eg: Jairam Ramesh has stirred the hornet’s nest by his outof-the-box thinking, arguing for a fresh approach to climate change negotiations.

27.10.2009

ramkyc@gmail.com (Ramakrishna) — Tue, 27 Oct 2009 01:48:13 PDT

Politics & the Nation

What ails Pakistan's policy towards extremists?

Take a look at today's ET editorial on the subject. It gives an excellent ringside view of the matter. An excerpt which we couldn't resist from giving:
Pakistan’s policy of differentiating between terrorists operating on its eastern and western flanks, and of elements within the security establishment still abetting the groups arrayed against India, was based on the fundamental misconception that different extremist Islamist groups would not, after a certain point, seek similar objectives. Tackling the Taliban in south Waziristan, thus, must be supplemented by going after the groups in south Punjab as well — and by initiating a far-reaching agenda of development and governance.

Now look at what Pakistan is saying!!

It accused India of backing the Taliban to create instability in Pakistan. This comes after revelations by western security experts that troubles within Pakistan were being fomented by the Tehrik-e-Taliban, Al Qaeda and extremist outfits operating from its soil.
These accusations only prove that Pakistan has few parallels in adopting over-the-top posturing.

Finance & Economy

Govt. to clarify that FDI in multi-brand retail is not allowed

The need for such a clarification arose out of the revised FDI policy announced in February 2009.
Under the revised FDI policy, a joint venture company in which the Indian entity has more than 50% stake and the right to nominate majority of its directors will be deemed to be an Indian company.
If such a joint venture makes investment in another company, the entire investment in that company will be counted as Indian investment. Under the earlier policy, downstream investment by such a joint venture was counted as indirect foreign investment.
The new rules, it was argued, allow indirect entry into forbidden sectors such as multi-brand retail through layered corporate arrangements where initial foreign investment is kept below 50%.
Look at this graphic too for a bird's eye view of the issue.

Why are companies worried about your health?

Take a look at this story; it is an interesting read that points to the emerging trends in corporate India.
A global study published last year showed that companies can save $1.65 in healthcare expenses towards employees for every dollar spent on a comprehensive employee wellness programme.

RBI smells something fishy in TMB share transfers

Former McKinsey CEO Rajat Gupta, NRI businessman Ramesh Vangal and a string of foreign investors have, according to a Reserve Bank of India (RBI) report, “acted in concert” with local investors while buying shares in Tamilnad Mercantile Bank (TMB), an old, closely-held private sector lender.
The regulator has observed that the nonresident investors and some influential Nadar community members had “formed a group” when they acquired a substantial stake in the bank two years ago. Under banking regulations, RBI’s approval is mandatory for transaction of 5% or more equity of a private bank. If the shares change hands without regulatory clearance, RBI has the power to cancel voting and dividend rights on the bloc of shares.
The entry of top-flight professionals like Gupta and Vangal in TMB two years ago had caused ripples in banking circles. Mr Vangal, former president — Asia Pacific for PepsiCo Foods, is the founder of the Katra Group and is widely known as the man who led PepsiCo’s entry into India. Mr Gupta, the first India-born CEO of a US transnational, is also an independent director at Goldman Sachs.
To get an inkling of the power struggle that is going on for the control of TMB, do read this story that appeared in today's ET. Don't miss the last couple of paragraphs of the story.

India gets a pride of place in prosperity rankings

India fares better in overall prosperity, despite weak economic indicators, and is ranked 45th in the world, ahead of China’s 75th rank, according to indices compiled by global think tank, Legatum Institute.
The composite prosperity index is compiled based on nine parameters, including factors such as economic fundamentals, environment for entrepreneurship and innovation, access to quality edu c a t i o n , democratic institutions, governance, health, personal freedom, social capital and security. The index ranks world’s 104 countries, covering 90% of the world’s population.
Finland tops the Index, followed by Switzerland, Sweden, and Denmark; the United States is 9th and the United Kingdom is 13th. India is ranked 5th on measures of social capital, which reflects among others, the percentage of citizens who volunteer, give charity, help strangers, and who feel they can rely on family and friends. In this area, India is ahead of Finland, the US, and the UK which occupy the sixth, seventh and the 11th spot, respectively.

International

US healthcare system wastes about $850 bn annually!

The US healthcare system wastes between $505 billion and $850 billion every year, according to a report. That’s one-third of the nation’s healthcare bill.
The waste results out of some of the most obvious inefficiencies, mistakes and fraud.
One example — a paper-based system that discourages sharing of medical records reportedly accounts for 6% of annual overspending.

France hopes to talk India out of the wine dispute

France hopes that it will be able to settle the dispute about import duties on wines and spirits with India to mutual satisfaction without going through the WTO dispute settlement mechanism.
In 2007 India had slashed the additional customs duty it charged on imported spirits, up to 150% of value of imports in some case, but simultaneously hiked the basic customs duties to 150% from 100%.
Prior to this, the European Commission had dragged India to WTO in 2007 seeking redress of its grievances which included what it called denial of ‘national treatment’ to liquor imported from Europe.
Under the national treatment rules, imported products have to be treated on par with domestic items. The WTO consultation process on the issue was suspended following New Delhi action on duty front in 2007.
EU is not completely satisfied because of the increase in basic duty. Moreover, major consuming states of imported wines such as Goa, Tamil Nadu and Maharashtra also impose special fee on these items. In 2007 EU exports of spirits to India amounted to about 57 million euros, while EU exports of wine totalled about 11 million euros.

Miscellany

Do you know that nickname for English cricket fans?

They are called the "Barmy Army."

Do you know the exact geographical centre of India?

It is the Zero Mile marker at Nagpur.

26.10.2009

ramkyc@gmail.com (Ramakrishna) — Mon, 26 Oct 2009 01:40:33 PDT

Finance & Economy

Know what is 'reverse innovation'?

It is the concept that is given a momentum by Jeffrey Immelt, the redoubtable CEO of GE.
It is the flow of knowledge and products from emerging economies such as India to the developed world.

A bit about global consumption patterns

Currently the American consumer spends about $10 trillion and 40% of the global population (China and India) spends about $2.5 trillion. Over the next 10 years this number will change dramatically. Global CEOs are readying for this.

Blue Revolution

It refers to the convergence of policy and action to execute a quantum jump in the generation of energy. Just as green revolution is to agriculture, blue revolution is to energy.
This is a term coined by Ravi Uppal, the MD of L&T Power. Given below are some snippets of info taken out from his article in today's ET.
Our per capita consumption of about 700 kwhrs gives us the unenviable distinction of being in the league of 40 LDCs.
The figures are revealing: global per capita consumption is about 2,600 kwhrs; developed nations enjoy a level between 10,000 and 20,000 kwhrs. China, whose total power generation capacity until mid-’70s was comparable with India’s, now boasts the world’s second largest power generation capacity — 700,000 MW. Its per capita consumption is currently around 2,000 kwhrs — three times as much as India’s, and set to surpass global averages by 2011.
Often government agencies claim that India’s peak time power shortage is about 12%.
Simple arithmetic tells us that if India were to match US energy consumption levels, our power generation capacity would need to grow to 3.6 million MW from the present level of a mere 175,000 MW.
India’s present coal-based generation is about 120,000 MW, which needs about 350 million tonnes of coal from its own mines. This capacity will need to go up at least three times, i.e., up to 1.2 billion tonnes to realise our target of about 400,000 MW from coal alone.
Germany and Spain draw over 25% of their generation capacity from wind alone.
Energy conservation if implemented can certainly contribute equivalent to about 150,000 MW of power.

Excise collections drop by 17%; cause for worry

Excise mopup fell reportedly to Rs 8,180 crore in September 2009, while the collection in the April-September period slipped by 21% from the corresponding period last year to Rs 43,230 crore.
Part of the decline in excise collections can be attributed to a cut in cenvat rate from 16% to 8% in the last financial by the government, as part of the stimulus measures to tide over the economic downturn. The government had, therefore, budgeted a 2% decline in excise collections for 2009-10, compared with the previous fiscal year.
A strong 22% growth in excise collections in August had raised hopes of excise collections beating estimates. Factory output had grown at 10.2% in August 2009. The disappointing excise collections in September give reason to doubt the output growth data. Excise collections peaked at Rs 1,23,000 crore in 2007-08. In the four-year period before that the collections grew at a average compounded rate of only 8%, well below the annual 16% growth in manufacturing for the same period.
Indirect tax collections from other heads also have been disappointing. Customs collections were down 32% in April-September, 2009 to Rs 38,810 crore and service tax mopup was down 4.0% to Rs 22,920 crore. Customs collections and service tax collections stood at Rs 7,600 crore and Rs 4,020 crore in September, showing falls of 32% and 15 %, respectively.

International

Hurrah over hummus

Lebanese chefs have prepared a plate of hummus weighing over two tonnes that broke a world record held by Israel — a bid to reaffirm proprietorship over the popular Middle Eastern dip.
Hummus is a thick spread made from mashed chickpeas, tahini, lemon juice and garlic; used especially as a dip for pita; originated in the Middle East
Tahini is a thick Middle Eastern paste made from ground sesame seeds

Miscellany

Comic book hero Asterix turns 50

Remember this character? It is created by Rene Goscinny and is illustrated by Albert Uderzo. But ever since the death of Goscinny, it was being written and illustrated by Uderzo.
Don't recollect the character? Take a look at the story and the accompanying graphic. We are sure, you will recognize the character immediately.

Sport

Wasim Akram's wife passes away

Huma Akram, wife of former Pakistani cricketer Wasim Akram, died at the Apollo Hospital in Chennai on Sunday morning after battling for life for the past five days.
Huma was suffering from sepsis (an inflammation of several tissues, including blood leading to kidney failure) and was admitted to Apollo Hospital on Tuesday after developing complications mid-air while on her way to Mount Elizabeth Hospital in Singapore from Pakistan.
Our deepest condolences to Wasim Akram.

India loses first ODI to Australia; crowd boos Dhoni

India lost the first ODI with Australia by just four runs and the crowd which got restive booed Dhoni. But Dhoni took it in his stride. Let us hope the team will play with the same spirit and win the series.

Language lessons

redoubtable: Adjective

Worthy of respect or honour; Inspiring fear

chagrin

Noun: Strong feelings of embarrassment
Verb: Cause to feel shame; hurt the pride of
eg: The circular that has now been withdrawn had been successfully interpreted, to the chagrin of the tax department, to put the income generated for a foreign company by a business process outsourcing unit in India outside the ambit of taxation in India.

queer: Verb

Hinder or prevent (the efforts, plans, or desires) of; Put in a dangerous, disadvantageous, or difficult position
eg: The global recession is having a queer effect in unlikely quarters.

pummel: Verb

Strike, usually with the fist

frat: Noun

A social club for male undergraduates

23.10.2009

ramkyc@gmail.com (Ramakrishna) — Fri, 23 Oct 2009 00:42:02 PDT

Politics & the Nation

Why is the CBI raiding the DoT offices?

The issue is possible corruption in the allotment of 2G licences last year. The Central Vigilance Commission suspects a criminal conspiracy between senior officials of the telecom department and some individuals and companies in the award of 2G spectrum licences for mobile phone services to eight firms. Hence it had asked the CBI to dig deeper into the issue.
The 2G licences, which came bundled with start-up spectrum, were awarded on a first-come-first-served basis early last year. The cut-off date for applications was controversially advanced, which resulted in several companies losing their eligibility for the licence. A pan-India licence was given for Rs 1,651 crore (about $400 million), a price fixed in 2001. Datacom, Swan, Unitech, Loop and STel were among the companies that were awarded the 2G licences.
Even before starting operations, Swan offloaded a 45% stake to UAE’s Etisalat for $900 million and Unitech divested up to 67.25% in its telecom venture to Norway’s Telenor for $1.1 billion.
The manner in which the licences were allocated and the sale of stakes by Swan and Unitech caused a political uproar, with opposition parties alleging that spectrum was given away at throwaway prices and allowed the companies to rake in windfall profits.
Read the full story here.

How to tackle the Naxal menace?

It is very rare for politicians, especially of the Congress party, to have the courage (or should we say the indulegence of the GoP) to propound policy measures to tackle any issue. That is best left to the Mantris in the government, with the caveat that if what they propound is not liked by the GoP, it will be vetoed. Digvijay Singh is one such Congressman who commands that respect and/or shown that indulgence so that he can air his views publicly -- that too in a newspaper article. Take a look at some of his prescriptions. They are well worth our attention. Don't miss his narrative also. It well worth a read. It is here.

Finance & Economy

Infosys's Narayana Murthy starts a PE fund

Infosys Technologies co-founder and chairman NR Narayana Murthy has sold company shares worth around $37 million (Rs. 174.3 crore) to set up a venture capital fund for incubating Indian start-ups. A statement issued by Infosys said the venture capital fund would encourage and support young entrepreneurs having brilliant business ideas. It further said that it will primarily invest in India and may, on a case to case basis, consider investing overseas.
So, if you have brilliant business ideas, you know where you should air them now.

International

China's economy registers 8.9% growth!

China's economy expanded at the fastest pace in a year as stimulus spending and record lending growth helped the nation lead the world out of recession. Gross domestic product rose 8.9% in the third quarter from a year earlier, the statistics bureau said in Beijing on Thursday. Separate reports showed industrial production and retail sales accelerated in September.

15th ASEAN summit under way at Hua Hin, Thailand

The fifteenth ASEAN Summit opened with the theme of “Enhancing connectivity, empowering peoples”. The Summit is expected to focus on issues relating to the vision of ASEAN as a Community of Connectivity, a Community of People. Also to be raised during the Summit are challenges that the region has to face, including food and energy security, climate change, pandemics, natural disasters and the financial and economic crisis.

Language lessons

skulking: Noun

Evading duty or work by pretending to be incapacitated
Verb: Lie in wait, lie in ambush, behave in a sneaky and secretive manner; Avoid responsibilities and duties, e.g., by pretending to be ill; Move stealthily
eg: "The lonely man skulks down the main street all day"

lug: Verb

Carry with difficulty; Obstruct
eg: Right now, Rahul Gandhi’s effort to sensitise the party to the lot of the deprived has resulted in farce, with loyal party leaders lugging what they consider to be the bare necessities of material comfort along with them when they follow their leader on his poverty trail.

22.10.2009

ramkyc@gmail.com (Ramakrishna) — Thu, 22 Oct 2009 00:26:03 PDT

Politics & the Nation

India China decide to cooperate on climate change issue

India and China have been negotiating on climate change as part of the bloc of 131 developing countries, commonly known as the G-77.
The agreement signed by the two countries called for cooperation on addressing climate change. The two countries will cooperate on mitigation policies, programmes, projects, technology development and demonstration relating to greenhouse gas emission reduction, which will extend to the areas of energy conservation and efficiency, renewable energies, clean coal, methane recovery and utilisation, afforestation and sustainable management of forests and ecosystem, transportation and sustainable habitat.

Finance & Economy

India poised to growt at 6.5% in FY10

The Prime Minister’s Economic Advisory Council, headed by former Reserve Bank of India governor C Rangarajan, said it sees gross domestic product (GDP) expanding by 6.5% in 2009-10.
The RBI had in July forecast that India’s economy this fiscal would grow by 6%, with an upward bias, and the Planning Commission said in early September that it sees GDP growth at 6.3%. The economy expanded by 6.7% in 2008-09 after three years of growing at over 9%.
Take a look at this graphic to get a picture of the key growth drivers. And this one gives you the big picture about our state of economy.

It is a trend that is sure to cause some heartburn in India, as it gives some comfort for the regulators

Take a look at this story about global accounting firms tweaking their organisational structures to increase accountability. Reportedly they are bringing in global heads to oversee their India operations.

What's the difference between whisky, brandy and rum?

India’s whisky consumption was pegged at over 120 million cases last year. Estimates of annual sales of rum are pegged at 45-46 million cases; while that for brandy are at around 44-45 million cases.
With so much consumption happening in India, isn't it reason enough for us to know the basic difference between the three of them? Take a look at the definitions that we fetched for you from the web below. But for the impatient: Rum is from sugarcane; Whisky from grains / malts; Brandy is from fermented fruits -- esp. grapes/apples.
Rum: Rum is the magical and versatile spirit of the Caribbean. Born out of the production and refinement of sugar cane. Rum was an important trading commodity in the 17th and 18th centuries. Most often made from molasses, Rum can be both light and dark with the later gaining color from being aged in wood casks.
Whisky: In simple terms it’s Whisky made in Scotland and by law it must be aged in wood cask for no less than three years. The vast majority of Scotch Whisky is the blended variety meaning it is a blend of predominately grain Whisky with malt Whisky. Single Malt Scotch has gained a huge global following and it most often represents Scotch Whisky in its highest form.
Brandy: A spirit created by distilling any fruit wine or fermented fruit base such as cider. Cognac and Armagnac are two of the most popular Brandies. Calvados is a popular example of a brandy made from cider based on apples and pears.

We may see grain prices increasing in the coming months

Take a look at this story; you will get the picture.

RBI to ask banks to hold securitised debt for 6 months

The Reserve Bank of India (RBI) may ask banks to hold securitised debt for six to seven months on their books before selling them to other market players.
In securitisation, an originator bank repackages loans in the form of marketable securities. These marketable securities are in the form of pass through certificates (PTCs), these are like bonds, issued by a special purpose vehicle (SPV) holding the loan.
The RBI’s proposed move is in keeping with action taken by regulators across the world to ensure that originators of securitised instruments continue to have what is referred to as ‘some skin in the game’. For instance, regulators in both the EU and the US now insist that the originator retain a minimum of 5% of issued securities on his own book, before sale. This they believe will lead to “ensuring material interest in the performance of the proposed investments”.

Science & Technology

Somehow we missed noting about the world's first underwater cabinet meeting

Take a look at this photographic story. The meeting was conducted by Maldives cabinet to highlight the threat posed by climate change.

Sport

What is the feat achieved by Bhutia that needs emulation?

Having achieved the rare milestone of playing 100 international matches, Indian football captain Baichung Bhutia said he wanted to see more players replicate his feat.
He was presented with a gold coin, a plaque and a cheque of Rs five lakh by All India Football Federation (AIFF) President Praful Patel.
Chief Coach of the Indian football team: Bob Houghton
On the occasion of felicitation of Bhutia, goalkeeper Subrata Pal received the Best Footballer of the Year 2009 award. He got a plaque and a cash reward of Rs five lakh.

Language lessons

skulduggery: Noun

Verbal misrepresentation intended to take advantage of you in some way
eg: ...That boast rests on the index the Railways employs to determine its safety standard: the number of accidents per million train kms, which has, according to the Economic Survey, come down from 0.55 in 2001-02 to 0.20 in 2008-09. But that can well be called statistical skulduggery.

21.10.2009

ramkyc@gmail.com (Ramakrishna) — Wed, 21 Oct 2009 01:40:15 PDT

Politics & the Nation

Two ministers bite the dust

Just a day after the position of these two ministers on some crucial issues is known to the public, they were made to retract their positions. The ministers in question are Jairam Ramesh and Kapil Sibal.
Take a look at these two reports. On Jairam Ramesh. On Kapil Sibal.

Finance & Economy

Govt. mulling offer of shares at a discount to lure back investors?

The government is reportedly planning to give small investors a 5% discount when it sells shares in three state-owned companies, hoping to lure individual investors who have shown lukewarm interest in two previous public issues by government firms.
Retail investors in the follow-on public offers of Rural Electrification Corporation (REC) and NTPC and the initial public offer of Satluj Jal Vidyut Nigam (SJVNL) due in the coming weeks will likely be allotted shares at a discount.
All companies must reserve 35% of the share issue for retail investors, 15% for high net worth individuals and the rest for institutional investors.
This is not the first time that such discounts are offered to retail investors.
In 2004, the government had given a 5% discount to retail investors when it sold shares in ONGC, Gas Authority of India, IPCL, Dredging Corporation and IBP.
In 2007, ICICI Bank sold shares to small investors at a 5% discount, becoming the first private company to do so. Retail investors were given a similar discount by Reliance Power during its initial share offering last year.

Why should you avoid being an independent director on the boards of companies?

Look at the troubles and travails of one such indedendent director; a famous one at that: Mr. Nimesh Kampani. He made a name for himself in corporate India.
The police had instituted cases against the KS Raju-promoted Nagarjuna Finance in December last year for its inability to repay public deposits worth Rs 100 crore collected in 1997-98. Hyderabad police had arrested Mr Raju, the chairman of Nagarjuna Finance, and PK Madhav, CEO of Maytas Infrastructure and member of the Nagarjuna board, in December last year. Both were later released on bail.
The police had also filed a criminal case against Mr Kampani. He was an independent director on the board of this company for about year between 1998-99. He had no connection with the company ever since. The police actions has been widely linked in media coverage to Mr Kampani’s role in arranging funding for Eenadu, a local media group. This was allegedly objected to by the Andhra Pradesh administration. It has also raised question about the culpability of independent directors in case of offences committed by a company.
In spite of his plea that he was in no way involved with the alleged defaults or offences committed by Nagarjuna Finance the AP police were on the lookout for him and, both the Supreme Court and the Andhra Pradesh High Court had rejected Mr Kampani’s petition for an anticipatory bail. In his petitions, Mr Kampani had opposed custodial interrogation.
Mr Kampani’s travails has shocked India Inc. Bankers and industry captains earlier told ET that Mr Kampani was wrongly targeted by the AP police as he had resigned from Nagarjuna Finance 10 years ago. Independent directors, analysts argue, have become wary about sitting on the boards of companies after Mr Kampani’s troubles.

When we made a mention about lead indicators sometime back, many among you were confused and some even at a total loss as to how the weight of ships could possibly indicate something about the state of the global economy.

Thinking that we have bitten more than what we can chew and with a view to not to compound the matters further, then we decided to let the issue die a slow death. In any case that would have made an excellent snippet of info in an MBA class or MA Economics class.
But now there is a leading indicator making its appearance on Indian economics firmament. Take a look. It will be interesting to watch it progress over the next few years.

IT majors find government business a tall order

As India's top tech firms TCS, Infosys and Wipro intensify efforts to address the lucrative government outsourcing market, they realise that project delays, frequent changes in leadership and increased public scrutiny make it tougher to execute public sector projects.
Indian public sector enterprises, such as India Post and Indian Railways, along with other government agencies, are expected to spend nearly $2 billion over the next 12 months on outsourcing of different processes and software services.
However, potential project delays like in the case of TCS-Indian passport services are among concerns looming large, even as Indian tech firms continue to remain bullish about the $2-billion Indian government IT-outsourcing market this year.

GST to rope in even small manufacturers into the tax net

A host of small-scale producers could come in the tax net under the proposed goods and services tax (GST) as the draft being examined by states seeks to impose the new levy on units with a minimum annual turnover of Rs 10 lakh.
At present, all taxes and levies have separate threshold levels—Rs 1.5 crore for excise levy, Rs 10 lakh for service tax and individual state limits for valueadded tax (VAT), such as Rs 2 lakh in Karnataka and Haryana to Rs 50 lakh in Punjab. GST will replace all these taxes, with a likely uniform exemption limit of Rs 10 lakh.
The low threshold limit for GST will bring more goods producers and service providers under the tax net and, conversely, a wider base will help keep the rate lower and make it more efficient.

In spite of a relatively non-benign CPI based inflation, why is there no case for tightening monetary policy?

For the faint hearted the question may look very esoteric. But a read of this article makes the issue very clear. An excerpt which answers our query:
It is true that consumer price index remains uncomfortably high. But disaggregated data does show that it is dearer food prices — along with higher, imported crude oil costs — that’s keeping the increase in the CPI much too buoyant and in the double digits. The point is that the inflationary trend remains very much supply-induced. Note that producer-price inflation, the increase in the wholesale price index, remains rather subdued — barely in the 1% range y-o-y. It indicates that the general increase in prices is not really demand-driven. In a demand-led price-rise scenario, there can be a fit case for monetary tightening. But when it’s rigidities in supply that’s driving up prices, tighter monetary policy may not so much bring down prices as decelerate overall growth.

Personality: Kenneth Feinberg

He is the pay czar appointed by the Obama administration to oversee the compensation of employees at companies receiving billions in federal assistance. According to news reports, Feinberg has broad discretion to determine the salaries and bonuses of the five most senior executives and 20 most highly paid employees at each of these companies.

Language lessons

on the same page: slang

When you’re on the same page as someone, you have an equal level of understanding about a situation. You have similar ideas about what needs to be accomplished.
When working with a group of people, it is important for everyone to be on the same page. Everyone should know what needs to get done and when it needs to get done. If people aren’t on the same page, problems arise.

20.10.2009

ramkyc@gmail.com (Ramakrishna) — Thu, 22 Oct 2009 19:52:20 PDT

Politics & the Nation

China building a dam across Brahmaputra?

The Congress-led UPA government has come under enormous pressure to act on reports about China’s plans to build a dam on the river Brahmaputra in Tibet. With Assam chief minister Tarun Gogoi expressing serious concern over the development, the issue likely to become a political hot potato for the Congress state government unless the Centre is seen to be making efforts to stop the construction of the dam.

Situation in Pakistan very grim

With the Taliban, which has thrown the Pakistani security establishment in a tizzy by executing as many as six major terror attacks within the country in the last fortnight, threatening to expand its zone of influence by bringing India within its jihadi framework, defence minister AK Antony warned that the situation in the western neighbourhood was “very grim and serious”, but asserted, at the same time, the country’s readiness to meet “any challenge”.

IIT entrance to have more weightage for Class XII result

Finding that Class XII exams and their results are becoming irrelevant by the day because of the excessive emphasis placed on the IIT and other entrance exams, the Centre decided to set up two committees to look into the issue.
The first, headed by Atomic Energy Commission chief Anil Kakodkar, will draw up a vision statement for IITs. The second committee will comprise department of science and technology secretary T Ramasami, department of biotechnology secretary M K Bhan and CSIR director general Samir Brahmachari. This will focus on the curriculum.
This decision to make the class XII exam relevant to the IIT admission process was taken at the meeting of the IIT council on Monday.

Finance & Economy

New inflation index will debut on Nov 14

The main barometer of inflation will debut in its revamped form on November 14. The updated wholesale price index (WPI), which will be made available monthly, instead of every week now, will have a wider and updated basket of products and a more recent base year -- 2004-05.
The new WPI will take into account price movements in more than 850 articles as against 435 commodities in the current index, which was last revised in April 2000.
India has one wholesale price index which is released weekly with a time lag of two weeks. There are three consumer price indices for industrial workers, rural workers and farm labourers, with data releases every month.
Though WPI is the key measure of inflation in India, it is not considered reliable as in any given week the prices of only about 16%-20% of the products included in the basket are updated. This is largely the reason that provisional figures are often revised sharply when more data becomes available. The monthly frequency of the new index will make the data more reliable.
Economists have long voiced the need for a good consumer price index (CPI) as the main measure of inflation. The CPI is the official inflation indicator in major economies such as the United States, Japan, China and the euro region. While the WPI measures changes in price levels for businesses, it cannot serve as an indicator of inflation at the retail level.
Take a look at this graphic; it is well worth our attention as it says figuratively what all we have noted above.

Who is Raj Rajaratnam and why is his arrest in New York making ripples in Indian and South Asian markets?

He is reportedly the richest Sri Lankan in the world. He has just been arrested on charges of insider trading in the US along with two others -- Anil Kumar, a McKinsey & Co director based in Silicon Valley, and Rajiv Goel, a director of strategic investments at Intel Capital. Besides, he is the founder of New York based hedge fund Galleon which has substantial investments all over the world especially in South Asia.
Edelweiss Capital is Galleon’s fourth-largest shareholding after eBay, Apple and Google. The fund’s other investments in India include that in Pipavav Shipyard (0.3% of equity share capital) and Reliance Telecom Infrastructure (RTIL), both pre-IPO investments.
Since Galleon normally invested around $5-25 million where a good book was built during an IPO, some bankers felt that investors in the hedge fund would now look at redemption and this could create pressure on the fund to liquidate its investments.
Read this news story and make out what you can. Don't you

Understanding the consumption patterns in the country

An excellent analysis on the subject appeared in today's ET. Take a look.

Here is an excellent primer on socio economic classification

Take a look at this graphic.

UAE is top export destination for Indian goods

United Arab Emirates has become the top destination for Indian exports in fiscal 2009 (April-March), displacing the US from the No 1 rank on account of a sharp rise in gems and jewellery exports.
The country’s total exports to the UAE grew by a phenomenal 53% to $23.92 billion in FY09 from $15.63 billion in FY08 even as exports to the US remained almost flat at $20.82 billion, according to the latest commerce ministry data. Notably, exports to the Gulf country were even higher than the combined exports to China and Hong Kong, which added up to about $16 billion during the fiscal.
Take a look at this graphic for knowing some other important export destinations for Indian goods.

Science & Technology

On rare earths

It is an interesting story. Many of you might remember rare earths as some of those elements that are tucked away somewhere in the periodic table that we read as part of our Chemistry classes. Is there a need to focus on them? If so, why? To get a comprehensive picture, do read this piece that appeared in today's op-ed. But some excerpts for us:
Rare earths are essential ingredients in mobile phones, video game machines, computers and even green technologies.
For example tantalum, a shiny, blue grey metal, can make batteries smaller even while storing more power. It also goes into modern nuclear reactors and lethal smart bombs.
Tiny amounts of two other rare earths dysprosium or terbium might soon be used in electric cars: they let batteries work at high temperatures.
For many years, India was the world’s largest producer of these rare minerals, mined from coastal sand. Till 1948, India was the world’s largest producer of rare earths. Today, it’s nowhere. India now is largely a coal and iron ore mining country.
Now, one country controls 95% of these minerals of the future: China.
If India has to become a significant player in tomorrow’s technologies, it needs to draw up special rules for rare earths. These rules should insulate investors from the clutches of state politicians and bureaucracies. And it’ll require New Delhi to draft special provisions for rare earths in its draft mining legislation.

More new planets found outside solar system

Astronomers have found 32 new planets outside the solar system, adding evidence to the theory that the universe has many places where life could develop.
The announcement increased the number of planets discovered outside the solar system to more than 400.

Medicine

India heading for diabetes explosion

India leads the world in the looming epidemic of diabetes, the 20th annual World Diabetes Congress of the International Diabetic Federation (IDF) was told here on Monday.
In its annual report, the IDF said India currently has the highest number of 50.8 million people suffering from diabetes, followed by China with 43.2 million and the US with 26.8 million. The report projected 58.7 million diabetes cases in India by 2010 - almost 7 percent of its adult population.
By 2030, over 8.4 percent of the Indian adult population will suffer from diabetes, thanks to the increasing life expectancy and urbanization, the report said.
There are estimated to be 285 million diabetes cases worldwide, accounting for seven per cent of the world’s population.
Diabetes, along with cardiovascular disease, cancer and chronic respiratory diseases, accounts for 60 percent ff all deaths worldwide.

Language lessons

Rolodex: Noun

(trademark) a desktop rotary card index with removable cards; usually used for names, addresses, and telephone numbers
eg: "a news reporter has to have a good Rolodex"

Blighty: Noun

A slang term for Great Britain used by British troops serving abroad

Beeb

It stands for the BBC

invective: Noun

Abusive or venomous language used to express blame or censure or bitter deep-seated ill will

diffidence: Noun

Lack of self confidence

19.10.2009

ramkyc@gmail.com (Ramakrishna) — Sun, 18 Oct 2009 20:53:19 PDT

Politics & the Nation

Justice Dinakaran: End of the road?

Charges of land encroachment against Justice P D Dinakaran, Chief Justice of the Karnataka High Court, have been endorsed by an investigation ordered by the Supreme Court, dealing a serious blow to the prospect of his elevation to the apex court.
It is reported that the district collector of Thiruvallur near Chennai, found Justice Dinakaran to have encroached 197 acres of public land around his property in Kaverirajapuram village. In his report to the SC, the collector has also held that the encroachments by Justice Dinakaran have blocked access to government land.
Now the Chief Justice of India Justice K G Balakrishnan and other judges who form the Collegium, may be considering to withdraw their recommendation for Justice Dinakaran’s elevation in the light of the damning findings of the Thiruvallur collector.
The Supreme Court Collegium headed by the Chief Justice of India comprises Justices S H Kapadia, Tarun Chatterjee, Altamas Kabir and R V Raveendran.

US plane carrying marines grounded

An American aircraft carrying 205 US marines was forced to land at Mumbai airport on Sunday morning for allegedly violating the Indian airspace. The chartered North American Airlines Boeing 767 was on its way to Bangkok from Fujiriah in the UAE.
The transport aircraft reportedly had civilian clearance from the DGCA to fly over the Indian airspace but it was carrying military personnel, for which the aircraft should have obtained Air Operation Routing clearance (AOR), needed for a military aircraft.
After remainining grounded from 7.52 am, the IAF allowed the US plane to resume its flight late in the evening.

Finance & Economy

Change in India's stand on climate talks?

India seems to have begun to shuffle its feet on climate change negotiations. Reportedly, the Environment minister Jairam Ramesh, appears to have suggested to the PM that India should junk the Kyoto Protocol, delink itself from G77 — the 131-member bloc of developing nations — and take on greenhouse gas emission reduction commitments under a new deal without any counter guarantee of finances and technology.
This comes just after he reportedly wrote to the PM suggesting India permit strict external scrutiny — as is done under IMF and WTO — of the mitigation measures it takes at its own cost.
If accepted by the government, the minister’s proposal will radically shift India’s stand from its position on climate negotiations that governments of all political hues have backed since 1990, and which was defended robustly as recently as at the UN talks in Bangkok earlier this month.
In his October 13 letter to the PM, Ramesh argues for a deviation from the Kyoto Protocol under which only the developed countries — listed in Annexure 1 — are required to take obligations for emission cuts, saying that it would also help in a better alignment with the US.

Country's largest flyover to be inaugurated today

The country’s longest flyover P V Narasimha Rao Expressway will open for traffic from today. Chief minister K Rosaiah will inaugurate the flyover at 4.30 pm.
The four-lane 11.633 kms expressway provides faster access to the Rajiv Gandhi International Airport.
The late CM Y S Rajasekhara Reddy laid the foundation stone for the flyover on March 16, 2006. According to schedule, the project should have been completed within 26 months, but due to various reasons, it got completed in September 2009. Nearly, Rs 600 crores was spent on the flyover.

NTPC to raise power tariff due to hike in coal prices

NTPC is set to hike the rates charged for supplying power to the distributors. The proposed move comes following an 11 per cent hike in coal prices by Coal India, which in turn would push the power generation expenses higher.
Out of a total of 30,000 mw power generated by NTPC, 26,000 mw comes from coal based plants.

Henceforth will it be monthly inflation data?

The government is likely to clear on Monday a proposal suggesting release of inflation data on monthly basis and not every week for bulk of the items tracked by the Wholesale Price Index (WPI).
The Cabinet Committee on Economic Affairs (CCEA) is expected to take up the commerce and industry ministry's proposal, which was finalised on the recommendations of a working group headed by Abhijit Sen, member, Planning Commission.
In the first phase, data of only manufactured items, which have a weightage of 63.75 per cent on the WPI, would be released on the monthly basis. On a parallel track, weekly inflation figures would be given for the food articles and fuels.

Debit card usage surges ahead; while credit card usage slows down

Payments made through debit cards rose over 40% to Rs 9,911 crore in the first five months of this fiscal.
However, credit card transactions have slumped by more than 12% in the first five months of this fiscal to Rs 24,427 crore as as against Rs 27,834 crore registered last year for the corresponding period.
Credit card usage till the end of the last fiscal was to the tune of Rs 65,355 crore.

Science & Technology

GEAC approves Bt Brinjal

In a significant first for India, the Genetic Engineering Appraisal Committee, the country’s biotechnology regulator, has deemed Bt brinjal suitable for consumption. That clears the path for it to become the first genetically modified (GM) food crop to be commercially cultivated.
Bt brinjal, and by extension all GM food, has been at the centre of a fierce debate over the safety and utility of GM food products. Criticism has focused on the assumption that altering the genetic make-up of a food item is bound to have consequences, which could prove to be deadly.
No adverse effects on health have been reported for any transgenic product introduced anywhere in the world so far. GM food has also been found to have the same nutritional value as unmodified food by various studies.
The Food and Agriculture Organisation, a UN agency, has warned that worldwide food production needs to increase by a staggering 70 per cent by 2050 to prevent mass starvation.

Miscellany

Hank Ketcham: He is the creator of the cartoon character Denis, the menace.

Language lessons

bugbear: Noun

An imaginary monster used to frighten children; An object of dread or apprehension
eg: In his letter, Ramesh emphasizes his concern about India being seen as a bugbear for the developed countries in the climate negotiations.

shenanigan: Noun

Reckless or malicious behaviour that causes discomfort or annoyance in others; The use of tricks to deceive someone (usually to extract money from them)
eg: That Dennis drives his parents crazy is beyond doubt – the Mitchells constantly wear either a harassed or a bewildered look thanks to their offspring’s shenanigans.

nettle: Verb

Cause annoyance in; disturb, especially by minor irritations

16.10.2009

ramkyc@gmail.com (Ramakrishna) — Sat, 17 Oct 2009 00:17:35 PDT

Politics & the Nation

Swiss to amend laws to accommodate Indian concerns

Switserland has reportedly said that it will amend its laws to accommodate India’s demand for providing it with the list of tax evaders who have parked money in its banks.
Swiss Law does not permit fishing expeditions, or indiscriminate trawling through bank accounts in the hope of finding something interesting. It began disclosing the identity only after they were presented with evidence of terror finance after the 9/11 attack.

Obama knows how to reach out to various peoples of the world

Take a look at this snippet! He is celebrating Diwali in White House!
He is not preaching -- either conversion to other religions, beliefs or faiths -- he is just practicing what he has been preaching -- tolerance and accommodation to other beliefs and faiths.
This is what Gandhiji has said while he was alive. If only a majority of us could follow Gandhi, the way Obama could.

Peace prize or not, we get to learn more about the way Nobel Peace prize is awarded

Take a look at this news report, which is reporting about the objections to peace prize for Obama.
It is perhaps the first time in recent times that it is being drilled in everyone's mind that it is Norwegian Parliament which declares the peace prize. Many of us would have otherwise been blissfully attributing it to Sweden.

Pakistani chickens come home to roost

Take a look at this news report about Pakistan being under seize from within. Terrorists have been relentlessly striking at it with impunity. This is what happens when you groom terrorists. They will one day turn against you. This has what happened to the US in Afghanistan. This is what is happening to Pak now. It has happened to us in India too. Remember Bhindranwale and the LTTE?

An excellent insight into China's claims over Arunachal Pradesh

Take a look. This is from Brahma Chellany a noted strategic affairs expert.

Finance & Economy

Know the Sivakasi of the World?

We all know that Sivakasi in Tamilnadu is the place from where we all get our firecrackers for every Diwali. The town makes eight out of every 10 crackers made in the country.
But it is Liuyang city (China) — which produces 90% of the world’s firecrackers.
More on Sivakasi:

Historians say Sivakasi’s association with China dates back a long time. Ever since the British imposed curbs on Indian fireworks factories in Kolkata after the first war of independence, India has been importing crackers from China.
The Nadar community, which built Sivakasi’s matchwork factories, embarked on the firecracker business by importing crackers from China in the early decades of the 20th century. An industry cluster started getting built around Sivakasi as Shanmugam Nadar and Iya Nadar set up the first units in late 1930s to combat import restrictions during the Second World War.
Today, Sivakasi is home to around 450 firecracker units employing 40,000 people, and providing livelihood to another 1 lakh. Revenues from cracker sales last year were Rs 1,500 crore, which could take a 30% hit this year because of sluggish demand.

What is the estimated potential of our country in so far as crude and natural gas are concerned?

The estimates suggest that 1 billion tonnes of crude and a trillion cubic metres of gas may be in situ in sedimentary basins.

Why is the NELP VIII round a failure? Can you identify some causes?

First, the fiasco over tax exemptions on the production of natural gas. While there were no questions over tax exemptions till two years back, now it was stated that all investments made so far (till 2008) will not be eligible for tax breaks if the exploration results in the production of natural gas. Although tax sops will be available for new finds irrespective of oil or gas, investors are unsure of how long it would continue.
Then there is the flip-flop over the terms in the production-sharing contract and the various interpretations to the tenets of the contract over the last one year has raised far too many questions on the contractual sanctity and India’s regulatory regime.
Thirdly, the new Production Sharing Contract (PSC) has reduced the oil company to a mere contractor. It mandated that the oil company will have to sell as per the government’s utilisation policy and at prices approved by the government. This is in sharp contrast with the previous PSCs that were more liberal and market friendly.
Last but not the least is the impact of the ugly legal battle between two of India’s largest corporate groups — RIL and Anil Dhirubhai Ambani Group — that has raised some fundamental questions over regulatory issues and the role of the government.
If you want a greater elaboration on the above points, read today's op-ed in ET.

On chaos theory

Chaos theory, more commonly known as the ‘butterfly effect’, revolves around the notion of vast consequences emanating from a rather small action.
The 1972 paper read at a US science meet, which first made this idea popular, was titled “Does the flap of a butterfly’s wings in Brazil set off a tornado in Texas?” The idea being that the flapping of those wings might alter or affect the course of a storm far away.

Science & Technology

What are the risks associated with the introduction of GM foods? What exactly needs to be done to mitigate these risks?

Three possible consequences of GM foods present rational risks: allergic reactions, gene transfer and outcrossing. The first is self-explanatory. The second one relates to the possible transfer of the ingested new genes to the bacteria inside the gut leading to unforeseen consequences like resistance to antibiotics. Outcrossing is jargon for GM crops getting mixed up with traditional crops. All GM foods are extensively tested to prevent and control for these risks.
Only when it is ensured after repeated trials and tests that these risks are minimal or have been mitigated is approval given for introduction of a GM crop or foods based on GM crops.
The problem in India is the general lack of faith in the integrity of the testing and approval process. Even if the final committee that grants the approval is above board, suspicion lingers that the data they are presented with have been tampered with. People fear that agribusinesses can influence decisionmakers in high places, who could, in turn, make science pliable in the mouths of weak-kneed scientific personnel. This is a systemic issue that goes beyond particular ministers and officials. Reforming this is the key to introduction of GM foods.
(Answer is an excerpt from today's ET editorial.)

Language lessons

chickens come home to roost: Idiom

earlier actions come back to cause trouble for a person; haunt

cringe: Verb

Draw back, as with fear or pain; Show submission or fear

shrink: Noun

A physician who specializes in psychiatry
Such worries present healthy commercial opportunities — for the shrink, for science fiction publishers and the seminar/protest circuit, respectively — but pose no serious threat to human well-being.

patio: Noun

Usually paved outdoor area adjoining a residence

14.10.2009

ramkyc@gmail.com (Ramakrishna) — Wed, 14 Oct 2009 03:37:46 PDT

Politics & the Nation

China protests Manmohan Singh's visit to Arunachal; India retorts

CHINA on Tuesday, once again, employed its intimidate-and-contain-the-neighbour policy against India by protesting Prime Minister Manmohan Singh’s visit to Arunachal Pradesh, claiming it was a disputed territory.
In return, the Chinese envoy in India was told that India is committed to ensure that outstanding differences should not be allowed to affect the positive development of bilateral relations. New Delhi hoped that China would “similarly abide by this understanding.”
These antics will keep happening from time to time. Take a look at this map which shows all the Indian areas that China has come to possess over time.

What a fine piece on judicial activism!

Do read today's ET editorial on the subject. Marvel of a piece. A must read.

Finance & Economy

HNI club set to swell 3 times in 10 yrs

INDIA and China are together projected to treble the number of high net worth individuals (HNIs) from 4.48 lakh in 2008 in the next one decade, as per a report collated by Merrill Lynch Wealth Management and Capgemini, which pegged the number of Indian HNIs at 84,000 for the past year.
After seeing a 22.7% growth in the population of HNI in 2007 to 1.23 lakh — the highest percentage jump in the world — India saw a 31.6% drop in the number of HNIs past year.
The survey defined HNIs as those with investable assets of at least $1 million (Rs 5 crore), excluding their primary residence and consumables.

Why are I-Banks willing to work for free?

It is widely reported that 7 out of the 10 bidding I-Banks for the REC's (Rural Electrification Corporation) disinvestment issue offered to work for free on the issue.
Why are these bankers willing to work at zero cost in this booming capital market?
Reportedly “It is the league table game.” The bigger the size of the issue or the prestige attached with an issue, the better it is for the I-Bank to get mileage out of the work.
Besides helping the positioning in the pecking order in the league table, the public issue of public sector undertakings are in good demand among the foreign investors.
The REC offer is expected to mop up Rs 3,400 crore (at a current market price of Rs 200), which would include Rs 850 crore from the sale of government shares in the company. It plans to issue 12.84 crore fresh equity shares of Rs 10 each, constituting 15% of the existing paid-up capital of the company. In addition, the government has also decided to divest 5%.
There are instances in the past when these bankers have quoted zero fees but not in such a large number. In the NHPC issue, one of the bankers had quoted zero fees while other two have charged marginal fees.

It was only yesterday that we noted about the Transaction Cost Theory propounded by Oliver Williamson that won him the Nobel prize this year.

If you are hungry for more on this theory, today's article by Ram Singh explains it quite well.
The TCT explains why firms are so large as they are or how far can they grow. Sounding like a Professor? Don't worry the actual Professor did a better job of explaining it for us.
If you are an economics student, you can expect a question on this topic in competitive exams this year. We would surely expect one in Civils Mains paper.

Global current account deficits

The cumulative global current account deficit stood at $1.6 trillion in 2008, according to IMF.
While most developed economies slipped into deficits, emerging markets collectively were still in surplus. US accounted for 42% of the total account deficit, followed by Spain (10%) and Italy (5%).
On the other hand, China (23%), followed by Germany (13%) and Japan (9%) accounted for large current account surpluses.
Collectively, the surplus of oil and commodity-exporting countries was bigger than China’s.

Science & Technology

Today is World Standards Day

The International Standards Organisation (ISO) has selected this year’s theme as ‘Tackling Climate Change Through Standards’.

Medicine

Anaemia causing gene identified

In a major breakthrough, scientists have discovered a gene which helps to regulate iron and haemoglobin levels, a finding they claim may soon pave the way for treatments for anaemia.
An international team, led by the Queensland Institute of Medical Research, has identified the new variant of a gene, TMPRSS6, by analysing the genome of 4,800 healthy individuals from Australia and the Netherlands.

Sport

Personality:

Commonwealth Games Federation chief Mike Fennel

Language lessons

heffalump: Noun

(informal or childish) an elephant

putative:

Purported; commonly put forth or accepted as true on inconclusive grounds
eg: The court also has rightly followed through with prompt strictures on the state government’s putative violation of its own undertaking to stop construction.

veneer: Noun

Coating consisting of a thin layer of superior wood glued to a base of inferior wood; An ornamental coating to a building