Daily Excelsior... Editorial

EDITORIAL

By Arun Nehru

By S. Sethuraman

The World Bank has cautioned that any aggressive loosening of monetary policy in the United States could stimulate the economy, weakened by the housing crisis and market turmoils, causing growth to overshoot, commodity markets to tighten and inflationary pressures to mount, with ...more.

Politicians '
discount with poor

By Kedar Nath Pandey

EDITORIAL

Only choice

There could have been only one follow-up to the manner in which independent legislator Shoaib Lone raised the issue of assassination of his father in the Assembly: everybody listening to him accepts his demand. He was sentimental. He was bitter but was able to drive home his interpretation of the shocking incident. That more than a year had passed in between did not seem to matter. He did raise the spectre of political rivalry as being one possible cause of the murder. Moreover, he referred to a subject that concerned every politician living in a high-security zone. Ghulam Nabi Lone who was the Minister of State for Education was killed in his official bungalow in Srinagar's Tulsi Bagh area in October 2005. It was generally believed then that the militants had originally targeted Communist party of India (Marxist) leader Mohammad Yusuf Tarigami living nearby. Even to a layman it was evident that there had been a serious security lapse. The point was further established by an inquiry conducted by a senior bureaucrat. Mr Shoaib Lone apparently feels that there has been a mystery behind the tragedy inflicted on him and his family. He sought a probe by the Central Bureau of Investigation (CBI). The People's Democratic Party (PDP) of which the slain minister was a member was quick to positively respond to his plea notwithstanding certain heated exchanges. So was the National Conference. The Government has agreed to involve the country's premier investigating agency in the exercise. The curtain has thus been brought down on one of the most turbulent debates in the legislature in recent times. Nevertheless it must be said that in the gun-generated atmosphere of suspicion in the State it is very difficult to say anything with certainty about any happening. Truth is the first serious casualty. And even if it exists the people don't easily believe it. The emergence of violence as a tool to settle scores has left us confused. This again is something that we don't admit straightforwardly. Terrorism no doubt has played havoc with our ethos. Why should our boys, however, become instruments in its vicious hands?

The writing on the wall should be eminently clear to us. A gun-for-gun milieu has badly fractured our social order. It has put even our usually well-knit family structures under tremendous strain. There have been a series of happenings of late that point to this disturbing occurrence. A religious scholar's statement is quite relevant in our context: "Violence is a lie, for it goes against the truth of our faith, the truth of our humanity. Violence destroys what it claims to defend: the dignity, the life, the freedom of human beings. Violence is a crime against humanity, for it destroys the very fabric of society." Our State is a living example. We are required to mount a rearguard action to repair the extensive all-round damage done to human relationships. How do we achieve this objective?

We have to steel our resolve to fight the evil. This is the only choice left for us. Together we can do it. A CBI investigation can only attain a limited aim. What we are faced with is a wider negative effect that has taken a toll of our mutual respect and sensitivity. Is there any doubt about this?

Perpetual amnesty!

The question is old but has not lost its relevance. Why should government departments be permitted to get away with non-payment of electricity dues? How are they different from other consumers? The Government's latest statistics in this regard show that the arrears are mounting. According to information given to the Assembly, the Power Development Department (PDD) has yet to recover arrears worth Rs 576.05 crores from various government departments and corporations. Public Health Engineering, Irrigation, Police, Medical, Estates and public sector undertakings (PSUs) are big culprits. PHE alone accounts for Rs 208 crores and Irrigation 31.29 crores. Besides, local bodies have to pay about Rs 19 crores. The total overdues on this count far exceed the revenue of Rs 381.24 crores generated by the PDD till December last year (Rs 255.90 crores from this region and Rs 125.34 crores from the Kashmir province). On the other hand, the Government has to shell out more money for buying electricity. It has not been able to get over other problems as well like power thefts and transmission and distribution (T&D) losses. Its promise of installing electronic metres is less than half fulfilled: 46.9 per cent consumers are said to have been covered so far in the Capital cities of Srinagar and Jammu. The exact extent of additional proceeds thus accrued is not known but going by the available complete picture the gain can only be marginal. It is already known that T&D losses are whopping and far exceed the national average. Clearly a lot is required to be done to effectively curb them. There is empty bravado so far as the recoveries to be made from government departments are concerned. Concerned ministers talk of strict measures and have at times threatened to switch off their supplies. In reality, however, they do nothing except for wailing and gnashing their teeth in anguish. It is strange that in a regime dominated by the argument in favour of rationalising tariff the Government should not be able to set its own house in order. What prevents it from imposing some sort of discipline to make up for its inefficiency? Why can't, for instance, its different wings use alternative sources of energy instead of heaters during winters? Why can't power-guzzling air-conditioners be altogether stopped during summers? Surely, there is an old adage: "Cut your coat according to your cloth." The public exchequer can't be allowed to be treated with scorn.

At least on one occasion in the past the Government had implemented an amnesty scheme for domestic and private commercial defaulters. It was done with the best of intentions. What is to be noted, however, is that all those intending to benefit from it were required to clear a substantial component of their pending bills. In this instance, however, government departments are evidently enjoying perpetual amnesty. This approach should change. They must learn to live within their budgets and tighten their belts. By not doing so they are betraying the trust of those who honestly pay their bills. Why should the ordinary citizens suffer because of follies of the officialdom? As the rightful guardians of the government treasury they are reasonably justified in raising an accusing finger in the direction of those eating into it. The Government ought to understand that charity begins at home.

Cricket is in the air

By Arun Nehru

We have a 'controversy' on the Bharat Ratna awards and political parties with their recommendations promote the concept of the 'quota' system. Time for everyone to examine the whole approach to National awards in keeping with the ground reality. Times have changed and sometimes we take success and hard work for granted. We have a economic miracle at hand as China and India with a population base of a billion plus and a middle class in excess of 300 million plus drive the global economy [China is ahead of us by a wide margin]. We have a new breed of super stars cutting across diverse professions and I think it would be fair to say that the level of success they have achieved in their field of activity do the Nation proud and increase the influence of India and things Indian in the global society. The cumulative wisdom and the success of the Nation is not the 'exclusive' privilege of a few political leaders and whilst those in governance deserve credit for the 'reform' process it would be fair to say that the process has been slow and on occasions confused as we have Coalition structures with diverse interests. We live in the present and look to the future and when we talk of awards and recognition we have to widen our thought process and also look at the example we are setting to 65% of our population who are below the age of 35 and will be the leadership of the future. There are many super stars I would like to name but for every name I am aware of there would be a hundred names I would miss and in reality in any award a lucky 'few' get recognition for what is clearly a team effort. Team India is doing us proud and it would be a wonderful thing if we can look beyond individual leaders based on feudal concepts or on the principals of caste and religion.

The economy is very much in the news as the USA has financial problems as reflected by the sub prime issue and mortgages and banks report huge losses going into many billions. There is talk of a recession and there is talk of a slow down on growth and both of these could happen but I think the US economy will recover and recover quickly as trade is 'global' in nature and many US companies will benefit from their investments in China and India and both will record huge growth in GDP in 2008. I believe in the theory that the Indian economy has 'decoupled' to a certain extent but we are still affected by global events and a 'slow down' for a limited period in the USA will effect hurt us in the short term. We have elections due in 2009 and I sincerely hope that 'electoral' compulsions do not hinder the pace of development or the reform process at the Center. There are elections due next month in Nagaland, Meghalaya and Tripura and whilst every election is important none of these three has any sizeable impact on future trends. The important election will be in Karnataka in a few months and will be a battle between the Congress and the BJP and I think the former have the advantage. The Congress should take a lesson from the election in UP [Mayawati got a majority] and Gujarat [Narender Modi beat the anti incumbency trend] and they need a strong leader to battle the BJP in the state and I wonder when SM Krishna [good on integrity and competence] will end his vacation in Maharashtra and return to active politics. The Congress and the BJP both need strong and effective leaders to beat the anti incumbency trends and they have a very limited time before they face the electorate in Karnataka, MP, Rajasthan and Chattisgarh. The BJP is under pressure but with the elevation of LK Advani and the victory in Gujarat and HP they have a fighting chance in Rajasthan and a possibility of avoiding a total rout in MP and Chattisgarh.

Cricket is once again in the news as BCCI conclude a 1 billion TV deal with Sony and I sincerely hope that the recent 'peace talks' in Australia over the chaos of the Second Test will result in structural changes within the ICC and action along with accountability will be applied to Umpires and their selection and all involved including the Match referee will not be involved in future Test matches. The BCCI Chief Sharad Pawar will be the next ICC President and hopefully action on the current controversy will be taken to its logical conclusion and not compromised upon for a variety of reasons. All this has happened before and would have gone unnoticed but sheer technology and the media both electronic and print have bought the truth 'home' to the public both in India and Australia and it is quite remarkable that public reaction against the Umpires and the attitude of some members of the Australian team was very similar in both countries and this has forced everyone to deal with the matter with a great deal of firmness. Cricket is very big money for anyone associated with the sport and we have seen the recent problems faced by sports authorities in almost all countries covering all major sports on challenges faced by 'drug 'usage and 'match fixing' by individuals [on line betting is very big business ] and clearly the ICC and cricket bodies all over the world will have to be extremely vigilant and pro active in dealing with this menace. We are all happy that we are back to playing cricket and tomorrow the 3RD Test will start and for many of us in India it is good to see the return of Virender Sehwag and we wish him and the team well in Perth [fastest wicket in Australia].

Developing countries help growth

By S. Sethuraman

As US economy seemed to be edging toward a recession, with growth likely to go down to one per cent in 2008 and year-end economic data throwing up slowdown in new jobs, unemployment rate rising to 5 per cent and a sharper fall in the dollar, the Bush Administration was considering a stimulus package .

In the last few weeks, the world's leading stock market has often nose-dived, faced with incoming negative data and hints of a recession while markets and business keep building hopes on a sizeable FED cut in the current short-term rate of 4.25 per cent later this month to boost the economy..

According to the World Bank's Global Economic Prospects 2008, published on January 9, world growth slowed modestly in 2007 to 3.6 per cent compared with 3.9 per cent in 2006, a downturn due largely to weaker growth in high-income countries. In 2008 global growth is expected to moderate to 3.3 per cent and the world trade volume growth to shrink to 7.6 per cent from the estimated 9.2 per cent in 2007, but to recover with 9.2 per cent in 2009.

Resilience in developing economies is cushioning the current slowdown in the United States, with real GDP growth for developing countries expected to ease to 7.1 per cent in 2008, while high-income countries are predicted to grow by a modest 2.2 per cent, says the World Bank. China and India are expected to grow by 10.8 and 8.4 per cent in 2008 respectively as against 11.3 and 9.0 per cent in 2007. Over the longer term, the Bank says the resilience of developing countries' improved fundamentals would be tested.

US growth slowdown from the last quarter of 2007 has forced the Bank to lower the estimate for 2008 to 1.9 per cent and this is directly attributable to the housing mortgage crisis and consequent credit restraint but the financial market instability has also affected other high-income countries, especially the Eurozone. For the developing countries, the emerging scenario is mixed.

Developing countries have, over the last two years, exhibited signs of beginning to pull greater weight in the world economy. Their average growth at 7 per cent, mainly due to the vibrant expansion of China and India and a few other economies, has contributed to more than half of global growth. Faster growth of China and India and some other developing countries has also contributed to more than half of global import growth, at a time imports slackened in advanced economies like USA. The developing country import demand helped USA to increase its exports.

According to the Bank report, share of developing countries in global trade had risen from 25 per cent in 1990 to 35 per cent since 2000 reflecting intensification of their linkage to high-income countries and their becoming integral part of global business cycle. China and India are also important destination for exports from other developing countries and this should be having a leavening effect on world trade growth. At the same time, many countries, notably in Asia, have run current account surpluses or have built a comfortable foreign exchange reserve, with unprecedented increase in capital flows which should help them in emergencies..

While the impact of volatile markets on developing countries has been minimal so far, the Bank does not minimise the seriousness of downside risks leading to major market disruption, which could bring down US growth to one per cent (from its baseline projection of 1.9 per cent) in 2008 with adverse effects in emerging market economies. Developing countries in general could suffer from weaker global demand for commodities, price decline and terms of trade losses.

A weaker US dollar, the spectre of an American recession and rising financial-market volatility could cast a shadow over the projected soft landing scenario for the global economy, the Bank said. These risks would cut export revenues and capital inflows for developing countries, and reduce the value of their dollar-investments abroad. In this context, the reserves and other buffers that developing countries have built up in past years may be needed to absorb unexpected shocks.

Overall, the Bank expects developing country growth to somewhat moderate over the next two years but a much sharper US slowdown could weaken medium-term prospects in developing countries. The report's authors assume that credit turmoil in international markets will persist into late 2008, but that costs to large financial institutions will remain manageable and spillover from problems in the US housing market on consumer demand are likely to remain limited.

High commodity prices for oil, metals and minerals have benefitted many developing country exporters, especially among poorer countries. However, the recent increase in grain prices - partly due to increased grain production for biofuels - is hurting real incomes among the urban poor.

Among the regions, growth in South Asia edged down slightly in 2007 to 8.4 %, with industrial production and GDP growth driven by strong domestic demand. An expansion of credit, rising incomes, and strong worker remittances are buoying private consumption. Improvements in business sentiment along with rising corporate profits, are providing a further boost.

In India, a modest easing of growth from 9.4 per cent in fiscal 2007 to 9 per cent in 2007 reflected firming in import demand that resulted in negative net export position, further under-pinned by strong appreciation of the rupee. This worsened the current account position by 2 per cent of GDP (5 per cent in Pakistan).

Inflationary pressures in India eased over the first three quarters, helped by the rupee appreciation and inflation rate got lowered to three per cent by November 2007. But inflation risks remain, stoked by incomplete pass-through of higher energy costs to final consumer in several countries of the region and increasing pressures on food prices. Monetary tightening and large capital inflows in India led to significant currency appreciation in 2007, which, however, helped to ease inflationary pressures through import price.

The Bank says tight credit conditions, volatility in financial markets, risk of recession in USA and slowing growth in European Union should result in a fairly pronounced slowing of external demand for South Asia's exports during 2008. But contribution to growth from domestic demand - private consumption ad investment - is expected to remain relatively high despite tighter monetary conditions and further fiscal consolidation. Capital inflows into the region could also be affected by tighter credit conditions in international markets and decreased appetite for risk among investors. (IPA)

Politicians ' discount with poor

By Kedar Nath Pandey

Queen Elizabeth II celebrates her birthday with a pound of cake. It is all within the family in the Buckingham Palace. But the so-called Dalit leader and chief minister of Uttar Pradesh, Ms. Mayawati, celebrated her 52nd birthday, and Lucknow was bedecked like a bride. The birthday cake weighing 52 kg was wheeled in the lawn of CM's Kalidas Marg residence. Candles were blown, cakes were cut and rendition of the birthday song from her family-members, fawning party colleagues, bureaucrats and police officials, and pieces offered to her from all those gathered at the function-all in front of the multitudes of visual and print journos in a brazen, some would say outlandish, display of power and wealth.

Not satisfied with the grand celebration in Lucknow she flew into the national capital, conference room in a prominent five-star hotel had been converted into the venue for her press conference held late in the afternoon. But before waiting journalists who had gathered there in hundreds could be bombarded with Ms. Mayawati's sound-bytes, they were subjected to a tamasha. The UP chief minister, the newspersons were informed by state cabinet secretary Shashank Shekhar Singh, would be celebrating her birthday with them.

The BSP supremo was attired in a pink suit, and looking resplendent in a glittering diamond-necklace, diamond-studded earrings and new hair-do. She was flanked on the two sides by her father and party general secretary Satish Chandra Mishra. As if on the cue, they were soon joined on the stage by their family-members. Besides Mr. Shashank Shekhar Singh and Mr. S.C. Mishra, senior bureaucrats JN Chamber, Navneet Sehgal, DGP Vikram Singh, ministers Babu Singh Kushwaha, Nassemuddin Siddiqui and Swami Prasad Maurya crowded around her while she cut the cake, and sang "happy birthday Behenji." The show was not over yet and they then lined up to offer her cake from their own hands. Later she announced the launching of controversial Rs. 40,000-crore Noida-Ballia expressway project and favouring a three-way division of the state.

A day before BSP chief Mayawati's opulent birthday celebrations were held, the Congress party had openly attacked her and her party's "gift culture". Party general secretary incharge of UP, Digvijay Singh, has said that the Income-Tax tribunal's clean chit to her for huge cash and properties, that she accepted were gifts, would lead to "corruption" becoming "legalised forever". Interestingly, the party termed the I-T tribunal's order as "unusual" when the issue came to light in the media about 10 days ago. The Congress, which had restricted itself to attacking Ms. Mayawati's government on the law and order front till then, has now chosen to sharpen its attack on her for personal corruption as well. Remember she claimed that all the expenses of her birthday celebrations were collected from her party members. She has properties in all major cities in the country and according to an estimate cash deposit of more than Rs. 500 crore.

It was the most distasteful display of class (caste?)-based snobbery by Ms. Mayawati. Ask yourself: Have we ever had the TV blow up Ms. Vasundhara Raje's diamonds or Ms. Najma Heptullah's pearls? Have we ever asked why silk should sit easily on Ms. Sonia Gandhi or Ms. J. Jayalalithaa, but satin should jar on Ms. Mayawati?

The implication was clear: Here was a Dalit gate-crasher into India's exclusive and ferociously guarded political Fort Knox. Her upper crust pretensions made her a joke; her borrowed strawberry feathers deprived her of her humanity; her upstart enjoyment of luxury reduced her to a preening caricature, to be expelled by sneers and laughter.

How could a champion of the backwards cut four-tier confectionery and distribute largesse-from laddoos to TV sets-like the royalty of yore, and not betray her downtrodden constituency, indeed her very roots? Obviously, the standards for the political 'upper crust' are different: No one talks of betrayal by its representatives when they pursue the perks of power and live in the lap of luxury while claiming to serve the people. Gandhian humility and renunciation are for the birds-or the backwards.

Mr. Laloo Yadav, of course, does with an elegant sense of fun what Ms. Mayawati does with a vengeance. He delights in the shock value of taking his rustic boorishness into the political elite's crystal and porcelain-dotted drawing rooms. He dares host NRIs, sporting a dressing gown and big game hunter hat, with his feet (sans shoes) placed on a cushion. He knew RJD misrule was never going to prove his nemesis. Reviled as a rustic, he plays bumpkin to the hilt-exposing the hypocrisy of India's minuscule, city-based and missionary school educated political elite that claims to represent the India that lives in the villages.

Think about why the political elite and the media display such high comfort levels with Sushil Kumar Shinde. He does not mind at all his party and the fourth estate a rabbitting on about his being a Dalit. When he gained national prominence as the Congress's vice-presidential nominee against the BJP's Bhairon Singh Shekhawat, it was said to be on account of his caste; when he became 10 Janpath-endorsed Chief Minister, it was also on account of his caste. And he knew how to play up his 'lowly' beginnings and sexy social categorisation, not to his professed constituency's but to his party's advantage.

In Ms. Mayawati's loud self-projection through an alternative ideological tradition, she dared personify the material ambitions of those she represents. The rights of nearly 20 per cent of India's population to a slice of the nation's cake were equal to those of any other section of society: That was her message. And her message was as deviant as Mr. Shinde's was politically conformist: Dalits had to prostrate themselves before the Congress's regal high command. For, his personification of their good fortune was an unsolicited gift, not a natural right.

It seems India's flat-earthers in the political and media elite still refuse to believe the world has long been discovered to be round. That is perhaps why, when Mandal emerged to demand a share of the fruits of progress for everyone, the flat-earthers felt they would fall off the edge. The snobs with a stake in the feudal status quo thought their conspiracy of silence on the need to expand the socio-economic base would last forever. The brown sahibs who never once sniffed a danger to democracy from dynastic annexation of political space, suddenly saw it menaced by the mob. Everyone forgot there was a consensus on redistributive social justice from the time of Independence. Everyone still forgets politics today is a churning, a throwing up of forces and dreams hitherto suppressed, of regional assertion and coalition qui pro quo. Mayawatis and the Laloo Yadavs are examples how Indian political class has changed. Hell with the poor they claim to represent! INAV