Japanese Prime Minister’s India Visit: Tokyo-New Delhi Hold Annual Summit

Japanese Prime Minister Yoshihiko Noda has paid a visit to India. During his stay he met his Indian counterpart Manmohan Singh. After the meeting he said that Japan could contribute to India’s rapidly growing manufacturing sector. A total of 421 Japanese companies have established their presence in India and created 150,000 jobs.
India and Japan need to establish firm partnerships and enter a new era of economic cooperation to capitalize on mutual complementarities, Noda said while addressing the joint business forum organized by industry chambers Associated Chambers of Commerce and Industry of India (ASSOCHAM), Confederation of Indian Industry (CII) and Federation of Indian Chambers of Commerce and Industry (FICCI).
Commerce and Industry Minister Anand Sharma said both countries need to work closely to address current global challenges and have a defining influence in Asia and beyond. The two-way trade can reach a level of US $25 billion by 2014, up from $13.82 billion in 2010-11.
Sharma said Japanese firms have a major opportunity in India’s infrastructure and manufacturing. The country plans to invest $1 trillion in the 12th Five-Year Plan (2012-17) to build infrastructure.
The Delhi-Mumbai industrial corridor and dedicated freight corridor are the most ambitious infrastructure projects conceived so far which will have integrated townships. At the same time, the national manufacturing policy aims to boost production in sectors like electronics hardware, information technology, agro food processing and green power technologies. The Japanese government is committing $4.5 billion for implementation of this project.
Steady Progress in Relations
The meeting between Prime Minister Manmohan Singh and his Japanese counterpart Yoshihiko Noda, the sixth of the annual India-Japan summits, is a marker of the steady progress. It yielded the first official confirmation since Japan's devastating tsunami-earthquake-Fukushima meltdown that the country has not shut the door on a civilian nuclear deal with India. While Noda stressed the importance of learning the right lessons from Japan's nuclear accident, it appears that negotiations on a deal to assist India develop peaceful nuclear energy will continue.
The Japanese prime minister’s pledge of $4.5 billion over the next five years for the development of the Delhi-Mumbai Industrial Corridor, a commitment of financial assistance for two more infrastructure projects — Phase 3 of the Delhi Metro and a biodiversity conservation project in West Bengal — and his interest in sharing high-speed railway technology with India are significant.
Currency Swap Arrangement
During the Japanese prime minister’s stay, New Delhi and Tokyo have agreed to a $15 billion currency swap line, in a positive move for the troubled Indian rupee, Asia's worst performing currency this year.
India and Japan previously had a $3 billion swap arrangement that expired in June, said the official, speaking on condition of anonymity.
The currency swaps are expected to support the Indian rupee as it continues to weaken against the greenback and Europe's sovereign debt crisis hits India's exports. The dollar-swap arrangement with India follows a similar agreement with South Korea in October.
New Beginning Intensified
Noda's India visit started a year of intense bilateral activity. The foreign ministers of the two countries held a strategic dialogue in October, followed by talks between the defense ministers. In February, the two countries signed the Comprehensive Economic Partnership Agreement covering trade in goods as well as services; it came into effect in August.
Earlier in December 2011, India, Japan, and the United States held their first trilateral strategic dialogue. It is creditable that despite the political instability in Japan, and the scandal-induced paralysis in India, both countries managed to fit in these high-level exchanges. It is crucial that growing India-Japan ties are viewed independently of each country's relations with China.
Civil Nuclear Cooperation Agreement
The 10-page India-Japan joint statement has no doubt called for concluding the agreement with “due regard to each side’s relevant interests, including nuclear safety.” But this will hardly lessen the fears in the minds of millions of people who live in the vicinity of the areas where nuclear power plants are located or planned.
It is not surprising that Noda has been making a strong plea for the resumption of negotiations on a civil nuclear cooperation agreement between his country and India. He was a man on a mission, reiterating this whenever he got an opportunity during his stay in New Delhi as part of the annual summit between the two nations’ prime ministers.
The stakes are high as India expects to have 20,000 MWe of nuclear capacity on line by 2020 and Japan would like a share in this. India has already signed civil nuclear agreements with the United States, Russia, France, Britain, Canada, South Korea, Argentina, Kazakhstan, Mongolia and Namibia. Negotiations with Japan were brought to a halt after three meetings held last year after the March 2011 disaster that hit one of Japan’s oldest nuclear power plants — Fukushima Daichi Nuclear Power Station — which saw a meltdown after being crippled by a tsunami.

Cambodia Benefits From Internationalizing Border Clashes

The situation of clashes at the Thai-Cambodian border in Surin is still very worrying. Both sides rushed to build up troops and transport heavy weapons to build up bases for launching full attacks. The bases have been built along over 15-km-long borderline from Ta Khwai Temple to Ta Muean Thom Temple.
Cambodia has deployed troops from the Special Taskforce 91, which is under direct command of Major General Hun Manet, favorite son of Cambodian Prime Minister Hun Sen.
Main Reason
I believe Hun Manet wants to show and prove his fighting skill to the Cambodian people. This was the main reason that the Cambodian troops crossed the border to try to seize the Ta Khwai Temple three times but they were bombarded by troops from the Second Army Region, causing them to flee back.
It should be noted that when the Thai and Cambodian troops bombarding each other with artillery, Vietnamese Prime Minister Nguyen Tan Dung made two-day visit to Phnom Penh as a special guest of Hun Sen.
I believe Hun Sen and Vietnamese Prime Minister Nguyen Tan Dung, who is a great ally of Cambodia, definitely held a closed-door meeting to discuss the Thai-Cambodian border clashes.
What should be monitored is whether Hun Sen would seek military help from Vietnam if the fighting drags on. It should also be monitored how Vietnam, which is a member of Association of South East Asian Nations (ASEAN), will play its role regarding to this problem.
So far, what has become certain is that the Thai-Cambodian border clashes have been internationalized and sent to the United Nations very fast.
Maintaining Cease-Fire
UN Secretary General Ban Ki-moon issued a statement, demanding the two countries to stop using force to attack each other. The UN secretary general also called on the two countries to exercise restraint, so that they could hold negotiations to sustainedly solve the problem.
The UN secretary general also called on the two countries to come up with measures for effectively maintaining cease-fire, which should be verified immediately.
I see that the stand of the UN secretary general and ASEAN chairman, who called on the two countries to cease-fire and call for a measure for verifying ceasefire immediately, went along with the wish of Hun Sen.
Hun Sen wants third countries to get involved in the conflicts between Thailand and Cambodia.
This is a main problem that Prime Minister Yingluck Shinawatra must rush to solve.
As a result, Yingluck has made preparations to seek a talk with Hun Sen during an ASEAN Summit in Indonesia early May.
Negative Impacts
Yingluck raised a condition that such a talk must be a bilateral one without participation of any other country or organization.
The use of heavy weapons to bombard each other by the two countries has caused several negative impacts as following:
1. The longer the fight continues, the more casualties of troops of the two countries will happen. Although more Cambodian troops were killed than Thai troops, it was not an issue that we should rejoice.
2. The longer the clashes continue, the more budget will be spent.
3. Now that the situation in the bilateral ties has been under much tension, the hope has become diminished for two Thais, who have been detained by Cambodia on spying charges, to be released and sent back to Thailand.
4. More than 40,000 people in Surin and Buri Ram, including children and aged people, had to be evacuated and had to leave their homes and farmlands behind.
5. The border clashed prevented peoples living along the borderline from visiting each other like what they could do in the past.
6. The protracted fight will damage the border trades.
All in all, the border clashes had tremendous negative impacts.
Only a group of people do not care about the ongoing fighting.
They are Thai gamblers who continued to cross the border to gamble in casinos in Poipet.
As long as the casinos in Poipet are still open, the Thai gamblers will be willing to cross the border to fight against the casinos' owners.
And they will always return home empty-handed.

Similarities and Differences Between Withdrawal of Russian and US Forces

Russians started withdrawal from Afghanistan in 1367 Hijri (1988). Later, the Afghan Government fought the opponents alone until 1371 (1992) and defeated them in the month of February, the same year. Now, the history is about to repeat itself. Some indications are emerging that after the withdrawal of the United States, whether or not the Afghan Government will prolong? To answer these questions it is necessary to analyze the past and present.
With the Russian arrival in Afghanistan, comparatively general uprising was started from north to south and east to west of the country. The uprising was initially at public level. However, later, Jihadist organization came to fore. Currently, only the Tehreek-e-Taliban Pakistan and a portion of Hizb-e-Eslami are fighting against the government. During the Russian period, mujahidin were supported by the neighboring countries, the Arab world, Western Europe, the United State, China, and almost half of the world. However, no country openly sympathizes with the Taliban. The Pakistani Governments and Iran have been blamed. However, they never accepted these allegations.
Mujahidin’s Control
Following the war, former mujahidin were equipped with the spirit of Islam and Jihad. Government forces also had the spirit of patriotism. A proof to it is that in 1367 (1988), mujahidin carried out a fierce attack on Jalalabad. At that time, Nangarhar local government units surrendered. Only the national security and police units protected Jalalabad. The military guards coming to Kunar from Jalalabad were also cooperating with them. Mujahidin had taken control of the airport and had reached the city gate. In this war, Pakistani forces also supported mujahidin logistically. It is said that their artillery was also used in the war.
The time was close when the entire Jalalabad would have fallen into the hands of mujahidin. Dr Najibullah ordered 9th battalion, controlling the road security of Jalalabad, to reach Jalalabad. The first group of this battalion, which reached there was Group-155. Its commander was Arozgai Asadullah. The brave army commander of Nangarhar asked him to defend the airport. Assadullah said: I will object it. Commander asked how many men do you have? He had about 250 troops. He maintained his troops on Pica and other weapons. Then he started communicating with him. During the telephonic conversation, another language was heard. He asked his troops, if they understand that language. They said yes, they are speaking Urdu. He asked whose language is it? Troops replied: of Pakistanis. Asadullah said: Pakistanis have attacked our homeland. Homeland is like a mother. Those of you who respect the dignity of mother should stand up with me; if you do not, you are free to go. All the troops said: we will fight.
Commander Asadullah said: we will be fighting in standing position. There will be no lying or kneeing position. Injured and dead will not be carried out. Similarly, we will fight the enemy face to face. Then, he led and the troops followed him. They advanced for 2.5-km. They repulsed the enemy. All of them were killed. However, many of the enemy personnel were massacred.
Defeat of Mujahidin
The offensive of these 250 troops later caused the defeat of mujahidin. They were only fighting in the name of homeland and not for the national ideology. At that time, the government forces were equipped with the spirit of patriotism. They were taking mujahidin as enemies of the homeland. They were observing that mujahidin were setting ablaze schools, destroying bridges, uprooting electricity towers, killing teachers, same as the Taliban are doing now. However, right after the fall of Dr Najib's government, mujahidin started looting and plundering across the country, and proved their enmity with the homeland.
In March, Interior Minister General Bismillah said: "There is lack of patriotic spirit in army and police". Earlier, military commanders used to be patriotic. They were not looters. They were real men and were equally treating their troops, without any differences. However, now situation is not the same. Probably, due to the same reason, soldiers are less patriotic now than before. When Russians were withdrawing from the country, there were thousands of tanks, hundreds of transport and combat air-crafts, hundreds of helicopters, equipped artillery, Luna, (military) equipment, Scud missiles, and complete resources and possibilities of anti-air craft were in control of the Afghan Government. However, now our army does not have weapons, not even Pica and RPG.
UN Peace Plan
With the well maintained army of that time, an active and dynamic president like Najibullah was working for the country. He himself fought a war as a leading commander. However, President Karzai does not posses similar physical capacity or a consistence vision. He keeps on changing his statements. At times, he becomes furious and at other moment a cool minded person. Equipped army, high morale of troops, strong president, and fair administration was the bases of prolonging the rule of Najibullah. However, his government was not toppled because of mujahidin but internal conspiracies. Initially, the coupe d'état by Shahnawaz Tanai broke the backbone of his government. Later, the coalition between General Momin, Dostam, Syed Kian and Ahmed Shah Masud limited the writ of the government to Northern part of the country. General Nabi Azimi and Karmal's cooperation blunt the UN peace plan, and forced Dr Najibullah to resign.
Can the Hamid Karzai government sustain after the US withdrawal? According to the aforementioned points, now the opponents of the government are limited to two confronting political groups. They do not have support from any international element. They do not enjoy greater support because of the incidents of setting the schools on fire, destroying bridges, roads, and hospitals, and suicide attacks. The Taliban do not have capacity for face to face fight. They can only conduct sniper and suicide attacks. They can only be caught through intelligence and detective information. The government forces are incapable against them and do not have air forces and air defense. They do not have cannons, tanks, and other heavy weapons. Above all, the soldiers are not as loyal as they should be. Another good point is that there is no excuse for the government to fight against the Taliban after the US withdrawal. Most of the Taliban will surrender due to the peace talks.
Following the Russian withdrawal, Jihadist organizations told their fighters that the government has loyalties to Russians; therefore, we need to do Jihad against them. They leveled decree of infidelity against Dr Najib. Mjahidin did not clear their hearts for Dr Najib no mater how many testimonies he was making. However, now no one suspects Karzai. It is being said that he offers Tahajud Prayer (mid night prayer). Therefore, he sleeps until 0900 and does not attend his office.
After the Russian withdrawal, the Afghan Government was left alone. Only the Soviet Government was supporting it. Now, when the United States will withdraw, the entire world will support Afghanistan. As we have trained ex-army soldiers, they can be reappointed in army and their expertise can be utilized. Our former Army officers are accustomed with the Russians weapons. If heavy weapons are taken from Russia, three years is not a long time to establish air force and build air defense. Until our air force is not self sufficient, the United States and North Atlantic Treaty Organization (NATO) can take the responsibility of country's air force and army. The government can maintain its troops for patriotism.
Financial Support
It is only possible if the Taliban are propagated against their crimes. The Taliban should be shown videos of them killing the people, setting ablaze the schools, and destroying the public welfare infrastructure. They should be forced to realize that they should not forget the sacrifices of the people. On the other hand, those soldiers who have been martyred for the sake of homeland, their families should be provided financial support. By doing so, soldiers will be free of the worries of their families' sustenance. As the Taliban cannot fight face to face, and stress upon suicide and sniper attacks; therefore, the government should make its intelligence stronger. If all this is done, then there is a greater possibility that the government can stay for a longer period. However, weak leadership of Karzai is a matter of concern. If he cannot do it, he should find an active, dynamic, and strong person for war strategy and administration.

Money-Laundering (Amendment) Bill, 2011

Money laundering refers to the process of concealing the source of illegally obtained money. The methods by which money may be laundered are varied and can range in sophistication. Many regulatory and governmental authorities quote estimates each year for the amount of money laundered, either worldwide or within their national economy. In 1996, the International Monetary Fund (IMF) estimated that two to five percent of the worldwide global economy involved laundered money. However, the Financial Action Task Force on Money Laundering (FATF), an intergovernmental body set up to combat money laundering, admitted that "overall it is absolutely impossible to produce a reliable estimate of the amount of money laundered and therefore the FATF does not publish any figures in this regard." Academic commentators have likewise been unable to estimate the volume of money with any degree of assurance.
Regardless of the difficulty in measurement, the amount of money laundered each year is in the billions (US dollars) and poses a significant policy concern for governments. As a result, governments and international bodies have undertaken efforts to deter, prevent and apprehend money launderers.
PMLA (Amendment) Bill, 2011
Keeping these points in view and to bring prevention of money laundering legislation on par with global norms, Finance Minister Pranab Mukherjee has introduced PMLA (Amendment) Bill, 2011in the Lok Sabha. The Bill seeks to allow confiscation of proceeds of crime even during the trial.
The Bill also provides that in any proceedings relating to proceeds of crime "...it shall be presumed that such proceeds of crime is involved in money-laundering".
The proposed Bill has provision for attachment and confiscation of the proceeds of crime even before conviction, "so long as it is proved that offence of money-laundering has taken place and property in question is involved in money-laundering. The amendment was necessiated in view of India being an important member of the FATF and also chairing its Asia Pacific group. Therefore, it was important to make the existing PMLA in tune with the practice being followed across the world.
Provisions of Indian Law
The Bill proposes to introduce the concept of corresponding law to link the provisions of Indian law with the laws of foreign countries and provide for transfer of the proceeds of the foreign predicate offence in any manner in India.
The Prevention of Money-laundering Act, 2002 was enacted to prevent money laundering and to provide for confiscation of property derived from, or involved in, money laundering. The Act was amended in the year 2005 and 2009 to remove the difficulties arisen in implementation of the Act.
Moreover, the amendment bill seeks to use proceeds of crime as criminal activities and remove existing limit of five lakh rupees of fine under the Act.
About FATF
The FATF, formed by the G7 countries in 1989, is an intergovernmental body whose purpose is to develop and promote an international response to combat money laundering. The FATF Secretariat is housed at the headquarters of the Organization of Economic Cooperation Countries (OECD) in Paris. In October 2001, FATF expanded its mission to include combating the financing of terrorism. FATF is a policy-making body, which brings together legal, financial and law enforcement experts to achieve national legislation and regulatory AML and CFT reforms. Currently, its membership consists of 34 nations and territories and two regional organizations.
In addition, FATF works in collaboration with a number of international bodies and organizations. These entities have observer status with FATF, which does not entitle them to vote, but permits full participation in plenary sessions and working groups.
FATF has developed 40 Recommendations on money laundering and 9 Special Recommendations regarding terrorist financing. FATF assesses each member country against these recommendations in published reports. Countries seen as not being sufficiently compliant with such recommendations are subjected to financial sanctions.

RBI Releases Financial Stability Report

At a time when there is growing uncertainty about the health of many Western banks, the latest version of the Financial Stability Report (FSR) just released by Reserve Bank of India (RBI) is reassuring. Indian banks remain robust though capital adequacy ratios have fallen and Non-Performing Assets (NPAs) have increased.
Capital Adequacy of Banks
Stress tests show banks are reasonably resilient though the capital adequacy of some banks could be adversely affected under severe credit risk stress scenarios. At a more disaggregated level, the picture is less encouraging. In particular, the consequences of, largely, public sector banks' headlong rush into lending for infrastructure projects, often at the behest of the government and the RBI, are now evident.
The report warns the 'growth rate of credit to the power sector has been much higher than the aggregate banking sector's credit growth and could unravel in case of a sharp economic downturn'. The same could also be said about bank lending to other infrastructure sectors such as real estate and airlines.
Low-Interest Rate Regime
A slowdown in domestic growth could raise the risks for the banking system as loans made in the low-interest rate regime of the previous two years turn sticky. More so since, as the report points out, all components of domestic demand, private, government, consumption and investment, have decelerated. On the external front, Indian banks with their limited exposure to overseas markets are relatively safe.
Nonetheless, contagion from the European sovereign bond markets to international banks could trigger further deleveraging and raise the cost of foreign currency loans for Indian banks and corporates. However, to the extent regulatory arrangements worldwide have been strengthened with national regulators recognizing the importance of a coordinated approach, the system is, hopefully, less vulnerable than before.
Real Test
The real test is whether the financial market infrastructure, in particular the payment and settlement systems, will continue to function without major disruption, when the next crisis strikes. As long as the lessons of the 2008 crisis have been learnt, there is reason to second the FSR's vote of confidence.

Assembly Elections in Five States

In a move that has apparently upset Bahujan Samaj Party (BSP) Chief and Uttar Pradesh Chief Minister Mayawati’s electoral plans, the Election Commission has announced the schedule for the Assembly polls in five states, setting the stage for a key electoral battle that is bound to have a bearing on national politics.
The election to the 117-member Punjab Assembly will be held in a single phase on January 30 while Uttar Pradesh, which has a 403-member Assembly, will witness a seven-phase voting on February 4, 8, 11,15, 19, 23 and 28.
The elections in Uttarakhand will be held on January 30, Goa on March 3 and Manipur on January 28. Counting of votes will take place in all the five states on March 4.
The notification for the elections in Punjab will be issued on January 5, Uttarakhand on January 5, Manipur on January 4 and Goa on February 6. The notification for the elections in UP will be issued on January 10, 12, 16, 21, 25 and 28 and February 2 respectively, for the seven phases.
Model Code of Conduct
The model code of conduct has come into force with immediate effect. The election schedule is likely to affect the presentation of the Railway Budget and the Federal Budget for 2011-12. The budgets are normally presented in the last week of February, but this time the Model Code of Conduct will last till March 9. Asked whether the schedule will affect the budgets, Chief Election Commissioner SY Quraishi said: “That is something the government will have to take care of.”
In a first, the Electronic Voting Machine (EVMs) will have signs in Braille to facilitate the blind voters. The Election Commission has also introduced a toll-free number 1950 for redressel of complaints.
Cutting short the term of the Assembly by about two months could deprive Mayawati an opportunity to use her absolute majority in the House to boost her party’s strength in the biennial elections to the Rajya Sabha in April. The Congress is using all the forces at its command to improve its tally in the state.
The decision of the Centre to grant 4.5 per cent reservation to the minorities within the 27 per cent OBC quota is being seen as a clear move by the UPA government to woo the Muslims, who play a significant role in deciding the verdict in many constituencies in Uttar Pradesh.
The Rashtriya Lok Dal (RLD), which wields considerable influence in western Uttar Pradesh, recently joined the United Progressive Alliance (UPA) which could boost the prospects of the Congress in UP.
In Punjab, it will again be a battle between the Congress and the Akali Dal-BJP combine while Uttarakhand will see a straight contest between the Congress and the ruling BJP, which had recently changed its chief minister to give an image makeover to the state government.
Misuse of Black Money
In an attempt to check the misuse of black money in the polls, the Election Commission has decided to appoint adequate number of expenditure observers and assistant expenditure observers who would exclusively monitor the expenditure of the contesting candidates.
For greater transparency and for easy monitoring by the Election Commission, candidates would be required to open a separate bank account and incur their election expenses for that very account. Comprehensive instructions for the purpose of effective monitoring of the election expenditure of the candidates, including formation of flying squads, video surveillance teams in the constituency and involvement of investigation directorates of the income tax department, have also been issued by the Election Commission.
To deal with ‘paid news’, monitoring committees have been set up at district, state and Election Commission levels and necessary instructions issued to the district election officers.
The Election Commission also conducted a meeting with director generals (Narcotics) of five states to prevent the use of drugs during voting period.
Quraishi said the election dates have been decided taking into consideration climatic conditions, academic schedules, festivals, law and order, availability of security forces, time needed for their movement and deployment and other ground realities.

Sub-Quota for Minorities: Is It A New Political Gimmick?

The federal Cabinet has approved a 4.5 per cent sub-quota for minorities, which will be carved out of the 27 per cent quota for Other Backward Classes (OBCs) in Central government jobs and Central educational institutions. This means that minorities can claim 4.5 out of every 100 government jobs and university seats (where quotas apply).The decision comes just ahead of the assembly polls in Uttar Pradesh, India’s most politically significant state, where 18per cent of the population is Muslim and is expected to help Congress general secretary's goal of ensuring a good show for the Congress in the forthcoming assembly elections as well as reviving the party in its former bastion in the long run.
Muslims, the most significant minority in Uttar Pradesh, have a significant to decisive vote share in 120 of the state's 403 seats and 21 of the state's 80 Lok Sabha constituencies.
Nationally Declared Minorities
Backward castes and communities belonging to the five listed religious minorities of India — Muslims, Sikhs, Buddhists,Christians and Parsis — will be entitled to 4.5 per cent sub-quota within the existing 27 pc reservation currently available to OBCs for appointment and admission to federal government institutions. Even Sikh OBCs will benefit. Since the sub-quota has been carved out for five nationally declared minorities, backward OBCs from these minorities will get the benefit even if they are a majority in a given state.
the 4.5 pc sub-quota could be revised upward after the government receives the final figures of Census 2011 and the Caste Census currently in progress. The current sub- quota is an interim measure based on the OBC population estimates the Mandal Commission had extrapolated based on the 1931 Census data.
The sub quota will specially benefit Muslim OBCs from states like Uttar Pradesh and Bihar where the population of Muslim OBCs has been on the rise. In case of UP, the growth in Muslim OBC population (as per National Sample Survey Organization rounds which Sachar Committee used) was 17.6 pc in five years.
Uttar Pradesh Assembly Polls
The decision will benefit Muslims more than other minorities as there are many Muslim communities designated as OBCs.
In the 2009 elections, the Congress won 21 Lok Sabha seats in Uttar Pradesh, thanks to a shift in the Muslim vote from the Samajwadi Party. But with the gradual return of that vote to the SP, the Congress needed to do something to bring that vote back ahead of next year's Assembly elections.
A decision to this effect was taken at the meeting of the federal cabinet chaired by Prime Minister Manmohan Singh. The decision will pave the way for reservation in government jobs and educational institutions for minorities as defined in Section 2 (C) of the National Commission for Minorities Act, 1992. It will come in the form of an executive order, which was to be notified later Thursday night and would be applicable from January 1, 2011.Muslims, Sikhs, Christians, Buddhists and Zoroastrians (Parsis) are notified as minority communities under Section 2 (c) of the act.The decision is based on the recommendation of the National Commission for Religious and Linguistic Minorities (NCRLM). “The caste and communities of the said minorities which are included in the Central list of OBCs notified from time to time by the ministry of social justice and empowerment shall be covered by the said sub-quota,” sources in the government informed.
The NCRLM had pegged the OBC population at 52per cent of the country’s population, of which minorities constitute 8.4per cent. Based on the 2001 census, the Centre proposed a proportionate 4.5 per cent sub-quota for minorities.
According to the cabinet note: “The home ministry mentioned that some OBCs may protest against the ‘perceived’ reduction in the space for non-minority OBCs but that is the inevitable result of providing a quota within the reservation.”
Reservation for India’s 150-million Muslims is likely to have a sharply polarizing effect, even though the November 2006 Sachar Committee Report had found the minority community starkly under-represented in all spheres of professional and public life. The ruling Congress had then promised “reservations” to them in its poll manifesto.
Sachar Committee Report

The Sachar Committee Report entitled, ‘Social, Economic and Educational Status of the Muslim Community in India’, has initiated a new debate on the social, economic and educational status of Muslims in India. Although the debate has been going on for several decades, quite a few Governments have initiated studies on the community and evolved administrative measures on their basis. The findings are indeed shocking and revealing. What should be our response to this pathetic state of India’s largest minority? On account of a variety of factors, the work of the Sachar Committee and its report has greater significance and relevance than earlier initiatives. The seven-member high-level committee headed by Justice Rajinder Sachar, constituted by the UPA government, has done a great service to the Muslim community and entire country by identifying issues of equity as central to Muslim backwardness. The report states that the minority community in a society may remain deprived of the benefits of opportunities that become available through economic development. The sense of inequity, states the Report, is perpetual or a result of discrimination that the minority may face due to difference in identity.

Lokpal Bill: Political Parties, NGOs Come Under Scanner

The United Progressive Alliance (UPA)-led federal government has finally introduced in the Lok Sabha the much-debated Lokpal Bill. The Bill envisages creation of anti-graft institutions at the central as well as state levels with a provision for including marginalised minorities and other sections as members.
The government also introduced a separate bill for amending the constitution to confer constitutional status to the proposed institutions.
About New Bill
The all new Lokpal Bill has provisions to probe corruption charges not just against the prime minister and ministers but also against managers, secretaries and directors of religious institutions and political parties that receive donations from the public.
The new clause appears to imply that the Lokpal can inquire into complaints of corruption against managers of temples, gurdwaras, mosques and churches, even sports clubs or any other association which accepts donations from the public.
All NGOs that receive annual grants of more than Rs 10 lakhs under the Foreign Contribution Regulation Act, 2010 will be under the Lokpal and so will all political parties, because they also receive donations from the people. The catch-all clause would conveniently cover Non-Governmental Organizations (NGOs) like Parivartan,which Arvind Kejriwal, member of Team Anna, heads and even the NGO being run by another Anna colleague Kiran Bedi and others that reportedly receive funds under FCRA.
But the government has ensured some balance in the provision by offering the coverage of political parties as well. A political party under RPA 1951 is defined as “an association or a body of individual citizens of India registered with the Election Commission as a political party under Section 29 A.” The clause is wide enough to cover all sports clubs or any group of people working for any cause.
Salient Features
* The Lokpal's writ will extend to the Prime Minister (with some exclusions), Ministers, current and former MPs (except in respect of what they say or how they vote in the House), and group A, B, C, and D officers and officials of the Central government.
* Fifty per cent of the members of the Lokpal and Lokayuktas shall be from amongst Scheduled Castes (SCs)/ Scheduled Tribes (STs), Other Backward Classes (OBCs) and women. “Minorities” was added to this quota in the corrigenda circulated to MPs shortly before the introduction.
* NGOs and institutions receiving donations of more than Rs. 10 lakhs per annum from foreign sources will also be covered.
* Lokpal to have constitutional status and be accountable to Parliament
Though some of the suggestions made by social activist Anna Hazare and his supporters find reflection in the new draft, the UPA government's Lokpal continues to differ on several key points from Team Anna's version:
* Government nominees have a majority of one on the selection committee, which will choose the Lokpal's chairperson and eight members
* The CBI will continue to remain under the administrative control of the government and not the Lokpal.
* The judiciary and the citizens' charter are not part of the Lokpal but will be covered by other laws
Provisions Under Old Bill
The old Bill covered the prime minister only after he demitted office and bureaucrats of under secretary level and above. But the new draft law covers all Group A, B, C, D public servants, allowing the Lokpal to inquire corruption by lower bureaucracy, as sought by Team Anna. Others covered are MPs (except for conduct inside Parliament), ministers, government funded associations and NGOs receiving over Rs 10 lakh annual funding under the Foreign Contribution Regulation Act.
The new Bill comes quite close (except on the issue of citizen’s charter) to the ‘Sense of the House’ statement issued on August 28 at the height of Anna’s agitation. The statement had stated, “The Houses agree in principle that an effective Lokpal law must cover corruption by lower bureaucracy through appropriate mechanisms, have an in-built grievance redress system and provide enabling laws to establish Lokayuktas in states.”
The present Bill (unlike the old one) provides for Lokayuktas and the Constitutional (116th) Amendment Bill, 2011, introduced, mandates states to adopt Central Lokpal and Lokayuktas law, a provision Sushma Swaraj slammed as anti-federal and an encroachment on the rights of the states, some of which already have Lokayuktas.
Although the Lokpal will have its own Inquiry and Prosecution wings and won’t require prosecution sanction, it would not control the CBI as Anna wanted. It can ask the CBI for preliminary inquiry (PE) and investigation into complaints but the Bill clarifies, “Lokpal will have powers of superintendence over Delhi Special Police Establishment (CBI) in respect of matters referred to it for PE or investigation and can’t direct it to conduct inquiry in a particular manner.”
The Bill says the Lokpal will, after deciding on PE, refer complaints against all government officers to the Central Vigilance Commission (CVC). While the CVC will submit a report to Lokpal for prosecution of Group A/B officers, for Group C/D public servants, it will conduct its own prosecution under the CVC Act, 2003, and send periodic action taken reports to Lokpal. This recommendation was made by Congressman Abhishek Manu Singhvi-led parliamentary panel?s December 9 report on the Lokpal Bill.
The Bill also does not have an inbuilt grievance redress system as Anna wanted. It makes the Lokpal and Lokayuktas final appellate authorities in cases of non-delivery of public service due to corruption but doesn’t guarantee service delivery through Lokpal.
Opposition Against the Bill
Several parties, including the main Opposition Bharatiya Janata Party, and the Shiv Sena, the Samajwadi Party (SP), the Rashtriya Janata Dal (RJD) and the AIADMK opposed introduction of the Bill in the current form. The RJD, the SP, and the AIADMK were also opposed to bringing the Prime Minister within the purview of the Lokpal which, they contended, would not be “accountable” to anyone. They were also vociferous in their opposition to a provision which made it mandatory for States to set up Lokayuktas, contending it was an infringement on the “federal structure” and encroachment on the powers of a State government.
The problem, though, now lies outside it. If Hazare's efforts have brought the Lokpal issue where it has now, it would be unfortunate if the same Mr Hazare, out of some millennial spite that mistakes accommodation for weakness, sets off on a different agenda altogether. For at stake here is not who won and who didn't - defining which is about politics, not law-making - but whether a necessary anti-corruption law.

Withdrawal of Last US Troops From Iraq

The last US soldiers have rolled out of Iraq across the border to neighboring Kuwait, whooping, fist bumping and hugging each other in a burst of joy and relief. Their exit marked the end of a bitterly divisive war that raged for nearly nine years and left Iraq shattered, with troubling questions lingering over whether the Arab nation will remain a steadfast US ally. The mission cost nearly 4,500 American and well more than 100,000 Iraqi lives and $800 billion from the US Treasury. The question of whether it was worth it all is yet unanswered.
Captain Mark Askew, a 28-year-old from Tampa, Florida who was among the last soldiers to leave, said the answer to that question will depend on what type of country and government Iraq ends up with years from now, whether they are democratic, respect human rights and are considered a US ally.
Whither Stubborn Sectarian Clashes
US officials acknowledged the cost in blood and dollars was high, but tried to paint a picture of victory for both the troops and the Iraqi people now freed of a dictator and on a path to democracy.
But gnawing questions remain: Will Iraqis be able to forge their new government amid the still stubborn sectarian clashes. And will Iraq be able to defend itself and remain independent in a region fraught with turmoil and still steeped in insurgent threats.
Many Iraqis, however, are nervous and uncertain about the future. Their relief at the end of Saddam Hussein, who was hanged on the last day of 2006, was tempered by a long and vicious war that was launched to find nonexistent weapons of mass destruction and nearly plunged the nation into full-scale sectarian civil war.
Some criticized the Americans for leaving behind a destroyed country with thousands of widows and orphans, a people deeply divided along sectarian lines and without rebuilding the devastated infrastructure.
Some Iraqis celebrated the exit of what they called American occupiers, neither invited nor welcome in a proud country. Others said that while grateful for US help ousting Saddam, the war went on too long. A majority of Americans would agree, according to opinion polls.
The low-key exit stood in sharp contrast to the high octane start of the war, which began before dawn on March 20, 2003, with an air strike in southern Baghdad where Saddam was believed to be hiding. US and allied ground forces then stormed across the featureless Kuwaiti desert, accompanied by reporters, photographers and television crews embedded with the troops.
Saddam’s Secret Nuclear Weapon Program
The task assigned to them in 2003 has been accomplished. The United States under President George W. Bush entered the Iraqi war theatre after it had made substantial gains in Afghanistan where it had toppled the Taliban regime in the wake of 9/11. He found an excellent opportunity to use the anti-terrorism plank to achieve Washington’s larger objective of ensuring energy security. Unverified intelligence reports about Iraqi ruler Saddam’s “secret” nuclear weapon program were enough for President Bush to go ahead with his new plan. He also found out that Saddam had close connections with Al-Qaida mastermind Osama Bin Ladin.
The United States also did not bother about seeking the UN Security Council’s sanction for attacking Iraq. Even when it was conclusively proved that Iraq had no Weapons of Mass Destruction (WMDs) and that Saddam had no link with Al-Qaida — both being ideologically poles apart — Iraq was bombarded and Saddam dethroned. Later, he was captured and executed. Iraq was liberated from the clutches of the tyrant. What could have been done by the people of Iraq during the Arab Spring now was finished by the US with the use of its military might. But can this be justified legally, morally, ethically or otherwise? The debate is still on.
Iran-Iraq Shia Bloc
Ousting and killing Saddam, a secular despot, may have gladdened US Arab allies, who are despotic but quasi-theocratic. Ironically, it also pleased Shia Iran as the United States leaves behind a Shia-run Iraq. A consolidated Iran-Iraq Shia bloc will be to the liking of neither America’s Arab allies nor the United States itself. In short, the times ahead in West Asia are likely to be threatened with prospects of heightened tension. Such a state of affairs may not always fall short of actual fighting, not least when the US continues to play the ouster game in West Asia in the name of promoting democracy.
Undoubtedly, the Iraq war was unpopular from day one within the United States. It had been launched on clearly false premises. US President Barack Obama wanted to end the campaign he had inherited. He gave himself the deadline of December 31 this year, and has stuck to it. But it is lost on no one — not in Iraq, not in the United States — that the United States may have wanted to extend its stay in a reduced way for strategic reasons, but could not.

India-Russia Summit: Efforts To Resolve Bilateral and International Issues

The India-Russia summit has recently been concluded in Moscow. During his discussions with Russian President Dmitry Medvedev and Prime Minister Vladimir Putin, Prime Minister Manmohan Singh made an emphatic point about the utility, execution and expansion of the Russia-assisted Koodankulam nuclear power project, underlines the unerring durability of the relations between the two countries. The value of the relationship for both has transcended changes of government in New Delhi and the changed character of the state from communist to capitalist in Moscow. There were contretemps in Russia when the switch-over to capitalism was in progress, but the dispelling of doubts was swift as the new masters in the Kremlin looked around their region and the globe.
India’s continued pairing with Russia on a range of issues — to do with national security on the political as well as the hardware side, science and technology, and now possibly the education sector in terms of the understanding reached at the just-ended summit — plays a role of balance at a time when India’s relations have been fruitfully advanced with the West, especially the United States. Anxieties in the minds of not a few that the United States is invading every sphere of policymaking in this country appear misplaced when the significance of the Russian connection is understood in its widest meaning. The coming into being of the BRICS (Brazil, Russia, India and China) bloc in international affairs in recent years further cements India-Russia relations, which are not bedeviled by irritants in the bilateral sphere.
Areas of Mutual Interest
The agreements covered all the key areas that underpin the “special and privileged” strategic partnership between the two countries — energy, defence, space, trade and investment, and working together on the international scene. While a formal agreement on Units 3 and 4 at Kudankulam nuclear power project was not signed, pending the resolution of the safety issue controversy in India, the sides moved forward with the project. They agreed on exceptional soft loan terms for the new reactors that will ease the financial burden for India at the time of a global economic slowdown. The talks in Moscow also firmed up prospects for India to expand its presence in Russian oil and gas through joint ventures with Gazprom and Novatek.
Besides the global and regional issues, India and Russia have to further expand their bilateral cooperation in different areas of mutual interest like trade and industry, defense-related matters and civilian nuclear energy.
The two countries do not have a mere buyer-seller relationship. The prime minister has to ensure that more joint ventures, particularly in the area of defense, are undertaken so that India gets cutting-edge technologies from Russia.
Defense Supplies and Technology
In the four decades since the Indo-Soviet treaty the global political, strategic and economic landscapes have changed dramatically, but the core of the bilateral relationship was (and remains) cooperation in defense supplies and technology. In the years following the treaty, Moscow became a very dependable source of defense sales and technology transfer. To be sure, there was uncertainty and disruption of supplies and spares after the implosion of the Soviet Union. But these proved manageable.
Following India’s nuclear tests of 1998 and the ensuing international censure and sanctions, New Delhi and Moscow began moving closer. After Vladimir Putin became president in 2000, Russia and India concluded a fresh strategic partnership agreement.Bilateral Trade TiesDefense and nuclear energy will figure prominently in the prime minister’s discussions in Moscow. Yet it is equally important that both sides resolve at the highest levels to upgrade their economic relations. Bilateral trade has risen from a mere $1.67 billion in 2003-04 to $8.75 billion in 2010. But this fell short of even the modest projection of $10 billion.
An inter-governmental commission has been considering a range of measures to redress this state of affairs, including a comprehensive economic cooperation agreement and revival of the north-south transport corridor through Iran. Unless the two countries are able to add a solid economic layer to their relationship, its strategic dimension cannot be fully leveraged.
Strategic Partnership
Diverse areas of cooperation, from pharmaceuticals and hydrocarbons to information technology and aerospace engineering, which are yet to be explored, allow for optimism. Also, increased defense cooperation between the two countries has provided noteworthy results. At the start of the previous decade, India was only concerned with buying military technology from Russia.
The strategic partnership agreement has also facilitated cooperation in the energy sector. As a net importer of energy, India has increasingly turned to Russia as a major source of oil and natural gas. The Oil and Natural Gas Corporation (ONGC) Videsh has a 20 per cent stake in the Sakhalin-I oil and gas fields. New Delhi has also been keen on acquiring a comparable stake in the Sakhalin-III projects. India has been pursuing this for nearly six years now, but Russia is yet to respond favorably.
International Challenges
Putin takes over as president the following year and India can be assured of Russia’s continuing support with him around. After all, Putin has taken India-Russia relations to a new level since 2000, following the dry years of Boris Yeltsin. The real challenge is to reconcile the positions taken by India and Russia on the Afghanistan issue. While India believes that the US-led the North Atlantic Treaty Organization (NATO) forces should stay in Afghanistan until local forces are adequately equipped to take over, Russia insists that they should leave by 2014.
Moreover, the two countries are also faced with the challenge of evolving complimentary responses to a host of international challenges. The most pressing of these stems from Afghanistan. Even as the US and its allies prepare to drawdown their military presence in Afghanistan, the insurgency remains strong.
Both India and Russia are concerned about continuing instability, but their emphases are somewhat different. India is keen to ensure that Afghanistan does not again become a haven for terrorists, whereas Russia is more concerned about the problem of drugs flowing from that country. Moscow’s somewhat narrow approach is understandable in the light of its troubled history of involvement in Afghanistan. But it will be interesting to see how Russia’s policy shapes up in the aftermath of the US drawdown. The endgame in Afghanistan will unfold at a time when Russia’s relations with the United States are dipping.

Draft National Food Security Bill

The federal cabinet has approved the draft National Food Security Bill. It seeks to provide subsidized food grains to over half of India's 1.2 billion population. The bill is likely to be presented to parliament in the next few days and would be referred to standing committee. The food security bill promises 75 percent of rural population and 50 percent of urban households, the right to 7 kg food grains per person, at Rs.3 per kg for rice, Rs.2 per kg for wheat and Rs.1 per kg for coarse grains to the priority beneficiaries. The general category will be provided at least three kilograms of food grains per person per month at half the minimum selling price.The bill will also provide rations or cooked meals to children under 14 years of age, destitutes including women and persons on the margins of society. It is the pet project of the Sonia Gandhi-led National Advisory Council and was part of the Congress manifesto for the 2009 general election.The bill provides for cost-sharing to pacify the states, which will implement the law. The states have also objected over the authority to decide on the criteria to identify the beneficiaries.A three-tier grievance redressal mechanism at district, state and national level is also part of the legislation.Agriculture Minister Sharad Pawar had expressed concern that food subsidy, currently at Rs.63,000 crore ($12 billion), may go up to Rs.1.2 lakh crore ($23 billion) if the bill is implemented. Rising fertilizer prices and the Minimum Support Price (MSP) of the grains was another concern. Sources said managing the fianances would not be a problem but procurement would have to be improved. It is estimated that against the current procurement levels of 54 millions tons, the requirement may go up to 62 million tons. Government food grain stocks in August 2011 were 61.27 million tons.
Benefit for Women and Children
About 2.25 crore pregnant women and lactating mothers are expected to benefit from the legislation that proposes to give Rs 1,000 per month for six months as maternity benefit. Maternity benefits that are available only in 52 districts will be extended across the country. All this is commendable but there is need for caution since the economy is showing signs of sluggishness. The budget deficit will need to be watched. Finding the money to fund the ambitious scheme would also be no mean task. With procurement of food grains required to rise from the current 54 million tons to 62 million tons, the Union government would be up against a major challenge especially in years of drought.
Aiming to empower women, the Bill also proposes that the ration card will be issued to the eldest female member of the family. The proposed Bill also holds great promises for children. Children in the lower and upper primary classes would be entitled to mid-day meals as per the prescribed nutritional norms.
The federal budget for 2011-12 had provided for Rs 55,586 crore for food subsidy. But while revised estimates are that the food subsidy bill this year will be around Rs 63,000 crore, the new law would require more food grains and a lot more money to implement.
Fears have been expressed that the new Bill, as and when enacted, will fuel both shortages and inflation. The fears are not misplaced because in August this year, the food grain stock with the government was 61.27 million tons, short of what will be required to implement the scheme. The annual procurement of food grains by the government stands at 54 million tonnes and will have to be raised to at least 62 million tons, if the scheme is to be implemented.
Antyodaya Anna Yojana
Agriculture Minister Sharad Pawar had warned that the government should be prepared for two successive years of drought before the scheme is rolled out.
The scheme was also opposed by several states, which apprehend food scarcity and higher food inflation as and when the Bill becomes the law. They had also objected to the discrepancy between the proposed central scheme and the existing Antyodaya Anna Yojana (AAA) under which the poor are entitled to 35 kg rice at Rs 2 per kg. The Centre sought to go round the issue by raising the entitlement of everyone to 35 kg under the new, legal entitlement.
Other View
The proposed law aims to benefit 65 per cent of the population, which makes little sense unless the United Progressive Alliance (UPA) Government, by implication, is admitting that the vast majority, or two-thirds of the people of India, cannot survive without heavily subsidized food. Since that is not the case, it remains inexplicable as to why such a large number of beneficiaries are being targeted. While it makes sense to protect the poorest of the poor from hunger and malnutrition, it is absurd to extend the same benefit to those who can do without heavily subsidized food.
Moreover, there are three related aspects, apart from enhanced and ill-affordable subsidy, which merit comment. First, the demand for food grains will result in a shift in agricultural patterns across the country with farmers focusing entirely on rice and wheat. This is bound to cause a shortfall in pulses and cash crops. To meet that shortage, Government will have to resort to imports which, in turn, will fuel prices. Second, a scheme of this nature can be implemented only if there is a flawless storage and distribution system — since neither exists, implementation is bound to suffer. Third, the main problem with the NAC-conceived cockamamie schemes is that they are premised on the one-size-fits-all logic. There may be States which would rather spend the money on projects that can fetch long-term benefits and sustainable economic security for the poor.

Kim Jong-il Passes Away: End of an Era in North Korea

Kim Jong Il, the mercurial and enigmatic North Korean leader whose iron rule and nuclear ambitions dominated world security fears for more than a decade, has died at the age of 69.
Kim's death 17 years after he inherited power from his father was announced on Monday by the state television from the North Korean capital, Pyongyang.
Kim's longtime pursuit of nuclear weapons and his military's repeated threats to South Korea and the United States have stoked fears that war might again break out or that North Korea might provide weapons of mass destruction to terrorist movements.
Kim is believed to have suffered a stroke in 2008 but he had appeared relatively vigorous in photos and video from recent trips to China and Russia and in numerous trips around the country carefully documented by state media.
Principle of Self-Reliance
Kim Jong Il inherited power after his father, revered North Korean founder Kim Il Sung, died in 1994. He had been groomed for 20 years to lead the communist nation founded by his guerrilla fighter-turned-politician father and built according to the principle of "juche," or self-reliance.
In September 2010, Kim Jong Il unveiled his third son, the twenty-something Kim Jong Un, as his successor, putting him in high-ranking posts. Even with a successor, there had been some fear among North Korean observers of a behind-the-scenes power struggle or nuclear instability upon the elder Kim's death.
Unknowable Figure
Called the “Dear Leader” by his people, Kim, the son of North Korea’s founder, remained an unknowable figure. Everything about him was guesswork, from the exact date and place of his birth to the mythologized events of his rise in a country formed by the hasty division of the Korean Peninsula at the end of the Second World War.
North Koreans heard about him only as their “peerless leader” and “the great successor to the revolutionary cause.” Yet he fostered what was perhaps the last personality cult in the Communist world. His portrait hangs beside that of his father, Kim Il-sung, in every North Korean household and building. Towers, banners and even rock faces across the country bear slogans praising him.
Country’s Nuclear Arms Arsenal
Kim was a source of fascination inside the Central Intelligence Agency (CIA), which interviewed his mistresses, tried to track his whereabouts and psychoanalyzed his motives. And he was an object of parody in American culture.
Kim Jong-il was also a driver of the secret nuclear weapons program, which continued with secret help from Pakistan's A.Q. Khan network after a 1994 agreement with the Clinton administration supposedly froze all developments.
Kim sought to build up the country’s nuclear arms arsenal, which culminated in North Korea’s first nuclear test explosion, an underground blast conducted in October 2006. Another test came in 2009.
Mass starvation among the North Korean population, after the collapse of the Soviet Union ended critical external aid and floods ruined successive crops, did not divert Kim from his cultivation of the Korean People's Army, under his ''Songun'' (army first) doctrine.
Role as Defense Chief
Kim's role as chairman of the National Defense Commission, commanding the army, became more important than the general-secretary role in the Worker's Party. Frequent on-the-spot ''guidance sessions'' and sharing of meals with frontline soldiers were aimed at reinforcing personal loyalty among the soldiers.
The death comes at a sensitive time for North Korea as it prepares for next year's 100th anniversary of the birth of founder Kim Il Sung - Kim Jong Il's father. The preparations include massive construction projects throughout the city as part of Kim Jong Il's unfulfilled promise to bring prosperity to his people.
Seoul and Washington will worry that Kim Jong Un 'may feel it necessary in the future to precipitate a crisis to prove his mettle to other senior leaders', according to Bruce Klingner, an Asia analyst at The Heritage Foundation think tank in Washington.
Personal Interests
Kim was said to have cultivated wide interests, including professional basketball, cars and foreign films. He reportedly produced several North Korean movies as well, mostly historical epics with an ideological tinge.
A South Korean film director claimed Kim even kidnapped him and his movie star wife in the late 1970s, spiriting them back to North Korea to make movies for him for a decade before they managed to escape from their North Korean agents during a trip to Austria.
Kim rarely travelled abroad and then only by train because of an alleged fear of flying, once heading all the way by a luxury rail car to Moscow, indulging in his taste for fine food along the way.
One account of Kim’s lavish lifestyle came from Konstantin Pulikovsky, a former Russian presidential envoy who wrote the book The Orient Express about Kim’s train trip through Russia in July and August 2001.
Paroxysm of Grief
Kim's death was unlikely to plunge the country into chaos because it already was preparing for a transition. Kim Jong Il indicated a year ago that Kim Jong Un would be his successor, putting him in high-ranking posts. North Korea will now go into a paroxysm of grief that may continue until the 100th anniversary of Kim Il-sung's birth in April.

Human Rights Violation in Kashmir

The entire world is observing World Human Rights Day on December 10 at a time when 64 years have passed and neither the Palestinians have got their right of liberation and nor the United Nations has granted the right of self-determination to the Kashmiris in accordance with resolutions adopted by the same. Women, children, and men are plunged into darkness in both parts of the Islamic world. The world is enjoying a sound sleep by depriving them the oppressed of comfort and ease, or observes World Human Rights Day once a year to cover up their long-forgotten duty and then again go into a deep slumber.
Horrendous Facts and Figures
When we analyze Kashmir from the point of view of human rights violations, such horrendous facts and figures emerge that they move our hearts. These are the latest figures and it can be guessed that how horrific atrocities the Indian forces are perpetrating on oppressed and wronged Kashmiris. These facts and figures are of the period from 1989 to 30 November.
Hold your heart and have a look at them. Killed (men) 90,178; killed (women) 4,255; missing (men) 8,979; missing (women) 1,335; injured (men) 554,937; injured women (24,011); detained (men) 222,300; detained (women) 4,149; incidents of molestation of women, 9,908; widowed women, more than 25,000; orphan children more than 60,000; graves of unknown people, 2,700; killed people's graveyards more than 5,500; and 1,04,801 ruined homes.
Withdrawal of Indian Forces
The general situation in Occupied Kashmir (India-Administered Kashmir) is such that 800,000 Indian troops have been given open license to massacre unarmed Kashmiris, rape women, and destroy properties under the protection of savage and black laws like Armed Forces Special Powers Act (AFSPA), Terrorist and Disruptive Activities Act (TADA), Prevention of Terrorism Act (POTA), and PSA.
The entire state has been turned into a military camp and all the cities, towns, villages, and streets appear to be under curfew, baton charge, reckless use of teargas, and echoes of bullets. Gatherings of hundreds of thousands of people appear to be demanding the full withdrawal of the Indian forces from Kashmir, and an end to coercive occupation.
Even some conscientious Indian intellectuals like Arundhati Roy, Gotam Naulakha, Justice Sachar, and the Indian negotiators, who came to Kashmir, have expressed their final opinion that the Kashmiris do not want to live with India at any cost, now. During his recent visit to India, US President Barack Obama termed Kashmir disputed and a resolvable issue, contrary to the Indian desire. Linking mediation with the willingness of the two countries, the United States urged the immediate resolution to the issue through bilateral talks. The decisive power of South Asia: China, has also termed Kashmir disputed territory and has refused to grant visa to Kashmiris on the Indian passport. Even, it refused to grant visa to the Indian General Jaswal on the ground that he assumed command in disputed Kashmir. The supreme head of Iran, Ayatullah Ali Khamene'i termed Kashmir and Palestine resolvable issues and urged for the support of Islamic world. Former Libyan President Qadhafi urged the resolution to the Kashmir issue from the UN forum. The EU and its parliament has time and again stressed on honorable resolution to the Kashmir issue. Thus, international pressure is mounting on India for an immediate solution of the Kashmir issue, but the human rights violations see no decrease.
On one hand, India tries to crush the peaceful struggle of the Kashmiri people in the backdrop of international pressure, and on the other, it is expanding its military occupation and plundering Kashmir's resources. Approximately 800,000 troops are stationing on 2800,000 Kanal of land, whereas gardens, picnic spots, and forests are being forcibly taken into custody for more land. Only in Shopian District, 5,200 Kanal of forest land was occupied and 300,000 to 400,000 trees were cut. The local people are not allowed to install wood cutting or grazing machines while the troops are busy in getting furniture prepared from precious timber and are sending it to their native homes. Timber worth billions of rupees has been sent to interior India to date and the process continues.
Struggle of Kashmiri People
Similarly, power worth billions of rupees is being generated through power projects on water resources of Kashmir and 88 percent of it is being sold to Haryana, Rajasthan, Punjab, and Delhi whereas only 12 percent is being provided to the people of the state. India is also pursuing a strategy under a preconceived plan to change the Muslim majority of the state by a full scale cultural invasion along with political and military domination. The forces have set up a network of schools in the name of "Sadhwana" where an attempt is being made to mold innocent students and girl students into the Indian color through the Hindu education system and training.
Jammu Province of the state, where Muslims and Hindus are living in mixed population, the local administration and police force are playing a shameful and gruesome role to harass and terrify Muslims in collaboration with local sectarian organizations like the RSS (Rashtriya Swayamsevek Sangh), Shiv Sena, Bajrang Dal, and BJP (Bharatiya Janata Party), and they are practically being forced to migrate while attempt is being made to settle Sharnartheon (as published) in their place to change the Muslim majority identity of the state. Such demographic changes can have adverse effect on possible plebiscite. However, the international community is also mum on this.
We believe that being the main party to the issue, Pakistani Government should stand firm in its 64-year-old principled stand and should provide all its support to the liberation struggle of Kashmiri people. The historic struggle of Kashmiri people should be highlighted through full-scale diplomatic campaign and by activating media besides exposing the Indian atrocities and highhandedness on every forum of the world. How horrible is that the United Nations did not make any reference to Kashmir in the list of disputed territories its published this year because this issue has not cropped up for discussion for three years in a row, i.e., from January 2007 to 2010. It is a grave criminal negligence by Pakistan on diplomatic-level. We believe that the Kashmir issue should be the nucleus of Pakistan-India relationship like in the past. Talks should not be held with India until it gives up its traditional obstinacy and unrealistic approach and accepts the disputed and central status and tripartite status of the Kashmir issue. More than 150 rounds of talks have been held during the past 64 years, but these remained futile. Whenever the talks are held, then these should be Kashmir-centric and tripartite. This is not a border dispute that can be resolved through talks between the two countries. It is the issue of political future of 135 million Kashmiris and they are the prime and the most important party to this issue. Their direct participation in talks is inevitable.
Demand of Situation
The people of state have made this reality clear time and again that nothing, except full independence, is acceptable to them. Internal autonomy, division of state, or cross-border trade of potatoes or onions is not the resolution to the issue. The Kashmiris do not want any thing except full independence and this is the cause for which 125,000 sons of the soil have laid down their lives so far.
This should be noted that Kashmiris are not willing to budge an inch from their stance. They appeal to the entire world today, on the occasion of World Human Rights Day, to play its role in stopping the human rights violations in Kashmir and exert pressure on India for the resolution to the issue. If not, the international community should stop observing Human Rights Day because such violations are not stopped by seminars and walks but by something practical will have to be done for this. The world is negligent of its role to a great extent.

Importance of BRIC

The importance of Brazil, Russia, India and China (BRIC) in the world economy has increased manifold since the acronym was first coined nearly seven years ago. Few could have imagined then how the American economy would collapse and bring down with it much of the rest of the world. It is worth revisiting the original formulations on the significance of these four major countries that were made by representatives of a major American investment bank — now a much-maligned tribe and justifiably so — to understand why these economies would together influence the future of the planet we live in.
In October 2003, a report by two economists then employed by Goldman Sachs, Dominic Wilson and Roopa Purushothaman, argued that over the next half-century, the four countries of Brazil, Russia, India and China would become a much larger force in the world economy than the Group of Six (G6) developed countries, namely, the United States of America, Japan, Germany, France, Italy and the United Kingdom. According to the report, in 2050, India’s economy would be the third largest in the world after China and the United States. However, in terms of per capita income measured in US dollars, India would come last among the 10 countries being compared.
Economic Stability
The four BRIC economies taken together would be bigger than the G6 by 2039, it was pointed out. By 2025, these countries could account for over half the size of the G6 whereas the combined Gross Domestic Product (GDP) of the four economies were worth less than 15 per cent at the time the report was written.
The report predicted that in terms of US dollars, China would overtake Germany by 2007, Japan by 2015 and the United States by 2039. India’s economy could be larger than all but the United States and China in 30 years and Russia would overtake Germany, France, Italy and the United Kingdom. Of the current G6 countries, only the US and Japan may be among the six largest economies in the world by 2050.
What is noteworthy is that the Goldman Sachs report pointed out that India has the potential to show the fastest rates of growth over the next 50 years compared to the other nine nations. The real rate of growth of India’s GDP could be higher than five per cent over the next 30 years and close to five per cent till as late as 2050, the report claimed. India would be the only country among the BRIC economies recording growth rates significantly above three per cent per year. These figures appear rather conservative today — the Indian economy has grown by over nine per cent four years in succession and even at a time when the world economy is in recession, the most pessimistic estimate of this country’s GDP growth rate would be four to five per cent.
Goldman Sachs Report
It is important to note the downside that was mentioned in the Goldman Sachs report. Despite much faster growth, individuals in the BRIC "are still likely to be poorer on an average than individuals in the G6 economies by 2050". The exception would be Russia, which would catch up with the poorer among the G6 countries in terms of income per capita by 2050. China’s per capita income could be similar to where the developed countries are now (about $30,000 per capita per year) for, by 2050, the per capita income in the US would be roughly $80,000. By way of contrast, India’s per capita income would be a much lower $18,000 against around $50,000 in Russia and over $26,000 in Brazil, the report prognosticated.
A second report focusing only on India was written by Ms Purushothaman in April 2004 in which she pointed out that India and China (together account for 40 per cent of the world’s population) have both witnessed strong growth, both have surplus labour and both countries have diasporas to contribute to economic development. Yet, according to her, India was 10-15 years behind China in the "reform process", suggesting that better growth was yet to come in India.
Ongoing Economic Crisis
While pointing out the differences in economic orientation, Purushothaman did not mention the important political differences between the world’s two most populous nation-states: India is a heterogeneous, noisy, anarchic democracy while Chinese society is relatively more homogeneous, regimented and wary of granting its citizens excessive political freedom. On hindsight, it is also apparent that the BRIC report by the economists engaged by Goldman Sachs erred extremely on the side of caution. After the ongoing economic crisis, it has become apparent that the gap between the BRIC countries and the G6 would narrow at a much faster pace than had been anticipated.
India currently has no choice but to engage with Brazil, Russia and China in a more proactive manner, simultaneously competing and collaborating with them. Over the past three years, China has overtaken the United States as India’s largest trading partner. Russia, the world’s largest exporter of oil and natural gas, had been badly hit by the sharp fall in world oil prices but is expected to revive with oil prices firming up and expected to rise further. The International Monetary Fund (IMF) projected in April that Russia’s economy would grow by 0.5 per cent in 2010 after shrinking by six per cent during the current calendar year.
Changing Geo-Political Realities
With more than an element of hyperbole, there is no gainsaying the potential of Brazil becoming the "granary" of the planet, China the world’s "factory" and India, its "communications centre." Many in this country, particularly the Left, have been critical of Prime Minister Manmohan Singh for his ideological "tilt" towards the imperialist and capitalist US and the West. But in today’s recession-hit world, economic ideologies have turned upside down and India certainly cannot ignore the rapidly-changing geo-political realities or the fast shift in global economic power balances.
There is one glaring omission in the BRIC combine that needs urgent rectification. The acronym needs to be made BRICS with the addition of the letter "S" to include South Africa, the most powerful economy in the continent of Africa. That would make the grouping truly representative of the world and, perhaps, even a formidable combination for the future.

Stabilizing South Asia

With the beginning of 2011, the overall geopolitical and security scenario across the globe will appear to be distinctly dismal with 2010 not having witnessed any significant political breakthroughs toward peace and stability. Severe recession plagued the world’s economy as never before and the scourge of terrorism unrelentingly expanded its global footprint in more dangerously innovative forms.
Environment and Climate
Unbridgeable chasms in managing the world’s environment and climate continued to bedevil the developed and the still developing fraternity among nations where billions still remain deprived of the most basic sustenance.
Nearer home, South Asia presents a bleak picture with most of our neighbors suffering, apart from economic deprivation, political instability underscored by the ever-expanding specter of terrorism.
Mercifully, as alluded to by our no-nonsense home minister, India did not witness any major terror strikes in 2009 with over a dozen of these strikes perhaps averted, thanks to some improvements in our overall security architecture, besides the always welcome “luck” factor.
Terrorism Menace
Terrorists and all those agencies, predominantly foreign and now some home grown, which mastermind terror will undoubtedly be waiting in the wings to fructify their evil agendas soon for 365 days without a major terror act in the Indian hinterland would be unpalatable to them.
As such, 2010 could prove to be very challenging to India’s security apparatus, besides, once again, testing the resolve of the Indian state to combat terror. India thus has to look inwards to ensure its own well-being by itself, and as an extension of its ethos and values and as the premier power in this region, do all it can to stabilize South Asia.
To our immediate west lies the most dangerous expanse of the world, namely, the Af-Pak region. Pakistan, globally acknowledged as a fountainhead of terror, is at the cross-roads with its own existence as a nation-state under grave threat attributable to those very elements of the Taliban and Al Qaida it nourished for years to foment terror in India and Afghanistan as an extension of its myopic state policy.
Almost daily major acts of violence all across Pakistan have virtually brought it to a halt, but is Pakistan still sincere in combating terror or will its death wish take it to further ruin? An unstable albeit nuclear-armed Pakistan in the danger of imploding has severe security implications for India and we thus have to monitor the overall situation with great caution.
Though adopting a posture of benign neglect towards them may have some takers in this country, yet indifference towards Pakistan may not prove prudent in the long run. As we remain firm in not restarting the composite dialogue till the 26/11 perpetrators are brought to book by Pakistanis and as unambiguously stated by our Prime Minister that no redrawing of boundaries could be ever considered, India could mull over two steps in the larger interests of peace and stability for this region.
We must impress upon Pakistan that, in Afghanistan, India’s sole interest is to bring peace and development to that hapless nation and thus Pakistan must refrain from carrying out any anti-India activities there.
Accordingly, the first step India could contemplate is that if Pakistan officially commits to genuinely stop abetting terror, India may once again offer a no-war pact on the lines of one that was suggested by the Prime Minister in Amritsar four years ago.
Consequently, Pakistan could safely withdraw as many troops they wish from their eastern border to pursue their internal war against the Taliban and al-Qaida terrorists more vigorously.
The second step could be to invite the main centre of power in Pakistan, namely their Army Chief General Ashfaq Pervez Kayani, for a frank ‘one-to-one’ discussion with the Indian government on some security collaborative measures which need to be taken.
Our democratic dispensation in India will naturally be hesitant to have parleys with the Pakistan Army Chief in India instead of their political leadership and thus such meetings could be managed even outside the country in a confidential manner.
Nevertheless, as we must upgrade our badly lagging and ageing military preparedness, India must not remain indifferent to the happenings inside Pakistan and the small yet civilized constituency for democracy and sanity inside Pakistan needs our encouragement.
Importantly, India must also impress upon the United States that for stabilizing Afghanistan, more than a unilateral approach, getting together all the principal players of the region like Russia, even China, Iran, India, Pakistan and itself to collaborate, under the UN banner, may prove beneficial to that fragile and impoverished country.
Towards our East, after years of an uneasy relationship with Bangladesh, the scenario is positively encouraging with the friendly regime of Prime Minister Sheikh Hasina handing over the bulk of the Bangladesh-located rebel ULFA leadership to India.
This major goodwill measure needs to be reciprocated in a substantial manner by our government and we need to address the problems of the Farraka Barrage, the Tin Bigha corridor, the trade deficit problems with equanimity and in a spirit of cooperation.
India must make maximum use of this window of opportunity to cement a multi-faceted relationship with Bangladesh, especially during the forthcoming visit of its Prime Minister to India.
Notwithstanding the fact that Dhaka’s military establishment and intelligence agencies (predominantly its Directorate General Forces Intelligence) have had very close linkages with both the Chinese military and Pakistan’s ISI, a fresh approach to foster security relationships with them be tried. The cooperation of Bangladesh is vital for peace in our restive North-East region.
Maoists Issue in Nepal
With Nepal, over the years, our relationships have been peculiar of love and hate. Nepal, since the end of monarchy, has itself been witnessing a fratricidal struggle owing to the power and ideological struggles between the pro-democracy elements and the Maoists.
Notwithstanding the Maoists’ unfavorable perceptions of India, the visit of Nepalese leader Madhav Kumar to India in August 2009 was indeed a promising beginning for Indo-Nepalese relations. India must strive for the speedy implementation of the various trade and river waters treaties in existence and those signed recently.
We also need to give a fillip to the Bilateral Consultative Group on Security to address all security issues, including cross-border crimes. However, Nepal has to be firmly told that anti-India activities being masterminded by the ISI from Nepal, especially of sending in trained terrorists and the use of Nepalese territory as a conduit for smuggling in fake Indian currency to India has to be dealt with effectively.
China and Sri Lanka Factors
The Indian establishment needs to work out long-term strategic-cum-intelligence arrangements with the Nepalese establishment, notwithstanding the current opposition to it by pro-China elements inside Nepal. In addition, fencing of the currently open Indo-Nepal border could be thought of, besides revisiting the 1950 India-Nepal Treaty of Peace and Friendship.
Though we have warm relations with Sri Lanka, India does not appear to be proactive in furthering its multi-faceted relationship with the island territory. With the Chinese ever active in the implementation of their “string-of-pearls” strategy, it is embarking on the construction of the strategic port of Hambontota in Sri Lanka, which has security implications for us.
And now with Tamil Tiger Prabhakaran out of the way and the end of the civil war in Sri Lanka, India could consider supplying most of the military equipment for the Sri Lankan armed forces as possible and carve out newer areas of cooperation with its tiny neighbor. India has to prevent the Chinese doing a Myanmar in Sri Lanka.
The world acknowledges our “seat on the high table” and the potential of India as a significant global player in the coming years. A strong, secure and self-reliant India must play its major role to bring peace and stability to South Asia and the world at large.

Annual UN Climate Change: India Feels Heat

Two-week international climate conference with participants from more than 190 nations plus the European Union (EU) has already begun in Durban, South Africa on November 28. The conference is seeking ways to curb ever-rising emissions of climate-changing pollution, which scientists said last week have reached record levels of concentration in the atmosphere.
Addressing the conference, South African President Jacob Zuma said that global warming already is causing suffering and conflict in Africa, from drought in Sudan and Somalia to flooding in South African, urging delegates at an international climate conference to look beyond national interests for solutions. He added that for most people in the developing countries and Africa, climate change is a matter of life and death.
Talks Failed
Talks at the climate change conference have predictably bogged down over funding and over the insistence of the first world countries that emerging economies like India and China also commit to legally binding and higher reduction of carbon emission.
Nations like Japan, Canada, Russia and New Zealand have decided to back out of the Kyoto Protocol, the only legally binding treaty that requires 37 developed countries to reduce amount of CO2 they released. The European Union has made it clear that it would agree to more carbon reduction only if emerging economies like China and India also undertake some form of binding cuts to bring down their gases that trap heat and make the climate warm.
Government delegates from 194 countries have gathered in Durban to agree to the next steps to combat climate change. The talks have been bogged down by disagreements on the kind of actions that need to be taken by developed and developing nations.
Another area of disagreement is on the design of a Green Climate Fund, which will provide $100 billion a year from 2020 to developing countries to combat climate change. The report of the UN committee on how to set into motion such a fund is now being debated at the talks. The South American nations of Colombia, Venezuela, Nicaragua (representing the ALBA nations) as well as Saudi Arabia and the U.S have objected to its contents.
There is, however, an overall urgency for the Fund to be adopted at Durban so that money begins to flow. Tomasz Chruszczow, the Polish envoy whose country is currently presiding over the EU, told reporters that the report was a “good compromise.” “In its current form it would attract significant funding,” he said. “We believe it would be counterproductive to undertake technical decisions on the instrument.”
The Africa Group also supported India, which “is doing its fair share in the context of its own challenges,” said Nafo, the spokesperson of the Africa Group to The Tribune. The diplomat from Mali further noted that China was taking the lead in investing in renewable energies that do not pollute the environment.
As large developing economies release more CO2 in the atmosphere because of rapid economic growth in the past decades, it has also led to divisions within the bloc of G77 + China. Both have argued that their overriding priority remains poverty eradication.
Emission Reduction Obligations
Even before the annual UN climate change negotiations are formally kicked off in Durban, India was warding off pressure to commit to legally binding CO2 emission cuts. Developed countries are threatening to abandon the 1997 Kyoto Protocol, which imposes emission reduction obligations on 37 industrialized countries, if all major emitters don’t do more to curb their greenhouse gases.
The Indian delegation here has reiterated its stand that it was indeed absurd to expect India and other developing nations to undertake reductions on the lines of developed nations. The developing countries, says the Indian delegation, have the overriding priority of eradicating poverty and sustain development. Indian negotiators added that they have already taken on voluntary commitments to reduce emission by 20 per cent by 2020.
The Indian delegation cited the Stockholm Environment Institute’s Report, released in 2011, which said that pledges to reduce carbon emissions from developing countries are more than the targets set by the developed countries. The study, commissioned by Oxfam, estimates that over 60 per cent of emission cuts by 2020 are likely to be made by the developing countries. The emission reductions of China, India, South Africa and Brazil - the BASIC countries - could actually be more than the combined efforts of the seven most developed countries or zones, namely the US, the European Union, Japan, Canada, Australia, New Zealand and Russia.
Already there are concerns that talks over the next two weeks will fail. The 2010 talks in Cancun skirted around the issue with Japan and Canada asserting their opposition to the 1997 Kyoto treaty. The US had also backed out of the agreement in 2001, claiming that it was unfair. Developing countries, including India, want these talks to result in developed countries renewing their pledges, since the first phase of the treaty expires at the end of 2012.
But the European Union, Japan, Canada and Russia are not willing to be part of a treaty that neither includes the US nor emerging economies like China and India. But with mounting Republican opposition, the Obama administration cannot act decisively until the 2012 presidential elections.
Some countries have also hinted that another treaty could take as much as 10 years to work out. In Durban, the US has already made it clear that it would not agree to any legal instrument that did not put obligations on all major emitters.
The efforts to continue the North-South differentiation under the Kyoto Protocol is led by India, China, Brazil and South Africa (BASIC) countries. “The Kyoto Protocol is the cornerstone of the climate regime,” a Chinese spokesperson told delegates. “We call upon the developed countries to rise up to their historical responsibility and take the lead up by undertaking ambitious and robust commitments consistent with science.”
China is now the largest producer of carbon emissions followed by the US. Indian delegates maintained that the BASIC statement by China at the start of the conference testified to the group’s solidarity. The bloc of developing countries, however, is more fragmented due to the immediate danger faced by small island nations, which are most vulnerable to rising sea levels. The International Energy Agency report, released this month, said the world had five years before the consequences of climate change will become irreversible. The goal is to stop the Earth’s temperature from increasing more than 2 degree Celsius from pre-industrial levels. Despite the deadlock over the Kyoto Protocol, delegates from 194 countries will attempt to find solutions on issues like adaptation, finance and technology sharing.
On a positive note, however, the Indian delegation was pleased that it garnered some support for its three-point agenda - equitable access to sustainable development, unilateral trade measures (in response to the European Union aviation tax), and intellectual property rights - two of which were left out of previous Cancun agreements. India’s lead negotiator Jayant Mauskar said: “We are not talking about the Himalayas, Mumbai or the Ganges. These three issues are important for all developing countries.”
Saving Financial Costs
The UN's top climate scientist says global warming will lead to human dangers and soaring financial costs and that containing carbon emissions will have a host of benefits.
Addressing the conference, Rajendra Pachauri, head of the Intergovernmental Panel on Climate Change (IPCC), said that heat waves experienced once every few decades will happen every other year by mid-century.
Coastal areas and islands are threatened with inundation by global warming, rain-reliant agriculture in Africa will shrink by half and many species will disappear.
Pachauri said: "Many impacts can be avoided, reduced or delayed by reducing emissions. The costs of action would be offset by improved health, greater energy security and more secure food supplies.”
Weather Data Released
On the sidelines of the UN-sponsored climate change talks, the World Meteorological Organization (WMO) stated that the global average temperature in 2011 was down from the record high in 2010 because of it being a La Nina year, but it was still higher than previous La Nina years.
The latest weather data highlight the conundrum of the negotiations as governments spar on whether developed or emerging countries should bear the brunt of emission reductions. Few attendees expect a breakthrough on the talks, which come amid growing warnings about the likelihood and severity of global warming.The UN weather group stated 2011, still with one month left, was the 10th warmest year on record. While the temperature was down from 2010, the WMO said it was higher than previous La Nina years. La Nina typically has a cooling influence on temperatures.

India’s Economic Growth Rate

India's economic growth has slumped to 7.3 percent in the first half of the current fiscal, substantially below the budgetary estimate. The Gross Domestic Product (GDP) growth declined to 7.7 percent in the first quarter and it slumped further to 6.9 percent in July-September period. The economic growth was likely to be better in the second half of the current financial year. It is hoped that the country will be recovering some of the loss in our growth momentum and may end the year over 7.5 percent." The finance minister said the government was not in a position to boost growth through stimulus as it did during the global financial crisis in 2008-09.
Inflation Rate
Inflation has remained stubbornly high, near double digit, for the last two years despite an aggressive monetary tightening by the Reserve Bank of India (RBI) and claims of a series of fiscal measures by the government. Headline inflation based on the wholesale price index was recorded at 9.73 percent in October. However, food inflation has moderated in the recent week. It was recorded at 8 percent for the week ended Nov 19, according to the latest official figures.
Food inflation dropped to a four-month low of 8 per cent as on November 19, reflecting fall in prices of essential items like onions, potatoes and wheat giving relief to common man, while rates for rice and vegetables increased at a moderate pace.
Decline in food inflation may also give respite to the government which is facing heat from the Opposition on various issues, including the price rise. This is lowest since July 16 when it was 7.16 per cent.
The RBI raised the repo rate by 25 basis points to 8.50 per cent and the reverse repo moved up by a similar percentage to 7.50 per cent in its last policy review in October. Repo is the short-term rate at which the RBI lends to banks, while reverse repo is the rate at which it gets funds from banks.
The central bank has hiked policy rates five times this fiscal. In the last one-and-a-half months alone, it has raised the key rate (repo) by 50 basis points.
Foreign Trade
India's exports grew by just 10.8 per cent to $19.8 billion in October, the lowest in the past two years, mainly due to the declining demand in the US and Europe. The growth rate has been the lowest since October, 2009, when it contracted by 6.6 per cent.
According to the Commerce Ministry data, imports grew at a faster rate of 21.7 per cent to $39.5 billion leaving a trade deficit of $19.6 billion, the highest ever in any month in the last four years, which is also due to expensive crude oils and vegetable oils.
From a peak of 82 per cent in July, export growth has slipped to 44.25 per cent in August, 36.36 per cent in September and 10.8 per cent in October.
In October, oil imports grew by 20.73 per cent to $10 billion, whereas the non-oil imports rose by 22 per cent to $29.4 billion over the year-ago period.
But, for the cumulative April-October period, exports aggregated to $179.7 billion showing a handsome growth of 45.9 per cent, thanks to sterling trend witnessed in the previous months of the current fiscal.