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2 July 2011
Not so long ago, India had rejected controversial plans by mining group Vedanta to extract bauxite in the eastern state of Orissa. Environment Minister Jairam Ramesh had said- "The project had breached environmental protection acts and raised concerns for the rights of local tribes". UK-based Vedanta, owned by Indian businessman Anil Agarwal, wanted to extract bauxite from the Niyamgiri Hill range which is revered by the Dongria Kondh tribe. The Dongria Kondh tribe was opposed this mining project as it will destroy their sacred hill and their source of livelihood.
But now, in a turn around, the environment ministry’s statutory green authority has given green signal for exploitation of mining in the Dongria Kondh tribe’s heartland. Nitin Sethi informs in Times of India (pg-14) that the sudden revival of the fortunes for Vedanta comes days before the newly set up National Green Tribunal, but does not elaborate its significance nor does he look into the possible implications for the Dongria Kondh tribe. Soon, they will lose their identity in hard core jungle of concrete and will be lost like us? Do they have a remote chance to survive when their land will be taken over by greedy miners? Why call them greedy, because in their quest for money they are uprooting a tribe which now might be just alive in history books for the next generation. It’s a pity that hard core economists conduct cost-benefit analysis to ascertain the viability of project, but social cost is often given amiss. What will become of these innocent tribal in cruel urban setting? Unfortunately, it seems that greed is so powerful that it overpowers basic human values; while majority have no time to even think for them. Of the 35 newspapers scanned today, this news has not made to the front page of any of them. And it seems, this is not the last time, Jarawa tribals are also under threat, but do we care?
29 June 2011
Archival WATCH: 122 million Chavanis (25 paise Indian coins) went to America
The front page of Economic Times informs that 25 paise will be out of circulation from tomorrow. On 1 April 1957, the Indian Government took out a notification & took out decimal coins. The circulation of old rupee, 50 paise, 2 anna (8 paise), 1 anna (4 paise) was also declared valid for three years. New coins of one, two, five and ten naya paisa were put into circulation on 1 April 1957. Both the old coins & the new coins were considered legal tender for three years. One, two, five and ten new coins came in the market but it was said that circulation of 25 paise, 50 paise & 1 rupee will be done later.
But suddenly 25 paise disappeared from distribution. And this archival information has not been given by any newspaper today-The information in archival cutting of ‘Statesman’ newspaper reveals that government of India announced on April 22, 1957 that it was returning the "Lend- Lease" loan of 172 million fine ounces of silver obtained from USA during Second World War.
It was decided to pay in 50 million fine ounces of silver bars and rest in 122 million 25 paise coins! This 25p contained 50% silver, 40% copper, 5% zinc, 5% nickel. These 25p reached America through India based American Embassy. A press note issued by the Finance Ministry, Department of Economic Affairs, read- "During the war, the US Government lent on lease 226 million fine ounces of silver to the government of India to be returned five years after the duration of the emergency. The liability for the return of this silver was divided between India & Pakistan, India’s share being approximately 172 million ounces. For the return of this silver, the following arrangements have been agreed in between the government of India & USA.
The government of India will make immediate arrangements for the shipment of approximately 50 million fie ounces of silver of the requisite fineness in the form of bars to the US government. The balance of the silver amounting to approximately 122 million fine ounces will be made available in the form of quaternary alloy coins through the American Embassy in New Delhi. The first instalment of the shipment of the 50 million fine ounces of silver will start on April 24, when approximately three million fine ounces of silver will be shipped bt s.s. President Taylor. The balance of the silver will be shipped to USA as & when shipping space is available".
Shortage of 25p was always there, but it aggravated as since 2002, no 25 paise coins have been minted. The finance ministry spokesman explained to Economic Times- "The Ministry and the RBI had been receiving complaints that the circulation of coins of the denomination of 25 paise and below has been stopped long ago since their metal value exceeds the face value. Thus rendering them liable to melting & sale by unscrupulous elements".
Was there really no circulation of 25p coin? Maybe for those who could afford offering in Hindu temples or gifting shagun above denominators of Rs. 11 & above but what about the poor? But does anyone bother how will that poor woman, who wants to offer best wishes/offering in minimum denomination of Rs. 1.25, manage in times of high inflation? The private vendors will make a killing & ask for hefty premium for 25p- greed game starts here- again at the cost of the poor. But none of the mainstream newspaper has bothered to even consider this, look around folks when you visit a temple!
The new report by the ILO- “Spain: Quality Jobs for new economy” finds despite the fact that Spanish economy has begun to emerge from the crisis, employment situation remains exceptionally difficult and also calls for a plan of action to ensure that “no youth is left behind”, while avoiding further wage cuts and pushing for financial reforms that allow sustainable enterprises more access to credit. How good is the employment scenario back at home? Is India’s high GDP growth translating into high employment too? Take a clue from a news report by BS Malik in Tribune that lure of railway job left a man poorer by Rs. 3 million! And not forget the daily appearance of luring fake advertisements promising government jobs in the classified section of leading newspapers! Hang on, news reports, advertisement are not hard core weekly unemployment statistics. Unfortunately, unlike most developed countries, employment numbers are not regularly monitored here. What could be the reason, high expense for a regular unemployment survey? But given the fact the Planning Commission of India is lavishly spending money on unproductive expenses & does not even bother to provide its break-up to Hindustan Times’s RTI query, can this be a legitimate excuse? An Eye opener by Chetan Chauhan in Hindustan Times reveals in 2010-11, Rs. 8.5 million were spent for other administrative expenses, but Planning Commission didn’t bother to explain it, that too in response to a query under RTI Act! Nevertheless, Planning Commission went ahead & spent Rs 5 million on office and 2.9 million on publication! Live life king size in the country, also inhabited by malnourished children, what austerity? This is not all- “In all, the commission spent Rs 400 million through the scheme in the decade but failed to say how much it was spend on the original scope of scheme” (Hindustan Times).
18 May 2011
The Age of Exuberance: The State Bank of India (SBI) is the largest public sector bank in India. The front page of Economic Times shouts- “SBI Net Slumps 99% on Bad Loans, Pension”. The big concern is that the bad loans have piled up during the time when the heath of economy was in pink. The new Chairman of SBI has warned that more bad loans could pile up if the economy grows at a slower pace. In an interview to Economic Times, Pratip Chaudhuri, new Chairman of SBI does some straight talking about NPAs- “SBI has a structural problem that our net NPAs are higher that most PSU banks. Now this is problem that can’t be wished away, So we have to work on the asset quality....This area of the bank needs greater and whole-hearted attention from the bank’s top management..”. It seems that in the quest for more and more business (read loans), SBI has compromised on quality of assets but will this build up in a financial crisis? Waiting for the apex bank to comment, join the club? Point to ponder- SBI has been getting high rank on Central Vigilance Commission’s (CVC) penalty list, will the new chairman pay heed to this too? For SBI & Right to Information- more
16 May 2011
Back to School: The apex Court of India has advised the government to regulate free market, as it benefits only a few persons leading to increased inequalities in the society. The bench observed that unregulated free market would lead to massive market failures, in even with respect to those aspects in which markets are supposed to function effectively. It came down heavily on liberalisation, privatisation & globalisation.-“...The falsity of the knee jerk beliefs that markets are necessarily efficient, and will necessarily find optimal and just solution for all problems was again provided by the recent global financial crisis”. However this news did not make to the front page of 25 newspapers scanned today. To take a clue , Hindustan Times has carried it on page eight. The Supreme Court of India is indeed giving out not to be missed lessons in Economics. Many friends of SARCAJC point that money seems to be on free run on inequalities, affected social relations too – value being judged by bank balance, luxury model of car, price tag of house, designer label cloths, mobiles, jewels...list seems endless. But what about own worth (leave behind price tag of the show-offs)?
Also Check out video about Greed, in which Chief of IMF (in news today!) avoided the question- whether Greed can be regulated.
14 May 2011
India has finally admitted that high economic growth has benefited the rich more than the poor. The HT correspondent informs that India pointed out during a conference at United Nations that GDP growth rate has resulted in unsustainable resource use and lifestyle of the elite. This news has been ignored by other leading newspapers.
Will this admission see a change in domestic policies?
3 May 2011
The much awaited Policy Statement by Reserve Bank of India is out. However, large sections of industry are not too pleased by increase in repo rate by 50 basis points as they feel it will have an adverse effect on growth. Given the easy liquidity and high GDP numbers, it still is a smooth run. For the main street, it is important to view how RBI views high food prices, so let’s take a quick look:
.......Food inflation, after remaining in double digits for more than two years, decline to a single digit in November 2010. However, despite normal monsoon in 2010, food price inflation did not show the usual moderation. Furthermore vegetable prices also did not exhibit the usual seasonal pattern in 2010-1. This suggests that supply is not able to keep pace with the growing demand. Given the spike in international food prices even in significantly trade food items, imports do not provide an option to cushion domestic prices. Persistently high food prices are likely to exert sustained upward pressure on wages, thus transmitting through to wider cost pressure on prices...
The RBI has conceded that agricultural growth has been above the trend due to good monsoon. Then why supply has not able to keep pace with the growing demand? There is not a word about supply side avoidable distortions that are leading to higher equilibrium point of demand & supply. SARCAJC has been continuously bringing to light the sky rocking difference between wholesale & retail price of vegetables. The export-import has also played a role in all this greed play. A friend of SARCAJC points if there is growing local demand for food which is driving food inflation, why 49% of world’s malnourished children are in India? Any guesses? Interestingly, the RBI Policy statement is silent on deceleration of credit growth to agriculture and allied activities from 23% to 11% (variation Y-o-Y during 2009-10 as compared to 2010-11), though it mentions credit growth in services sector.
2 May 2010
The front page of Financial Chronicle asks in bold- “where your deposits went” on top of a Rs. 1000 currency note. The paper has chosen to highlight sectors (with symbolic illustration) that saw surge of credit growth (variation Y-o-Y during 2010-11 as compared to 2009-10). Now turn to page 8 for a full report. Here, Rajesh Gujra tells you again the high points (read sectors that show big jump in credit). The source of this data is Reserve Bank of India. Is that all the RBI data is telling? Nope, high sign missed by Financial Chronicle is that credit growth to agriculture and allied activities has decelerated from 23% to 11%. Now read this with latest Economic Survey, which has estimated the growth in GDP at factor cost for agriculture and allied activities to be 5.4 in 2010-11, compared to 0.4 in 2009-10. The Economic Survey also noted- “The real challenge in agriculture sector is to enhance capital investment in the sector both by public and private sector in a sustained way...”. Can this target be achieved with decelerated growth of credit? Anyway, agriculture and allied activities (which engage majority of Indians) gets smallest share of credit in absolute terms (13%) compared other sectors like industry (44%), services (25%) and personal loan (19%). Does the last component reflect easy money leading to higher consumer spending, higher growth? But who are the beneficiaries? Definitely, not the farmer featured in Peepli Live! In addition credit to ‘other infrastructure’ decelerated from 23% to 9%, man-made textiles decelerated from 82.4% to -7.4% (during 2009-10 to 2010-11). The RBI has not given any explanation for this on its website.
24 April 2011
Views of Day: The cartoon by Keshav reflects Narendra Shekhawat's views about the other side of great GDP figures. Take a look- "Do you know that , on average, 47 farmers have been committing suicide every single day in the past 16 years in our shining India- the next economic power, progressive with nine percent growth? .. On average, 17,000 farmers have been committing suicide every year, for the past 15 years on the trot. Can you believe it? Most of us wouldn’t know this fact. Why? Because, our great Indian media, the world’s largest media, are not interested in reporting this!..The media are supposed to be the third eye of democracy and also called the fourth estate, but now they have become real estate. Pure business...What is happening in our country is not different from Nero’s party. We, the middle-class-young-well-earning –mall-hopping-IPL-watching and celebrating-junta are Nero’s guest at the cost of our farmers....Yes, that’s what we are, Nero’s guests! I’m not against celebrations..if only all fellow countrymen, farmers, villagers also stand with me and cheer; only if they do not take their own lives ruthlessly, only if there is no difference between interest rates for a Mercedes and a tractor...Until then, this is what I have to say. .to hell with your celebrations”. (Narendra Shekhawat. Hindu)
18 April 2011
Greed Watch: Both IMF-World Bank had failed to predict global financial crisis that shook the world. And now, instead of monitoring & controlling greed their focus is on global growth! Chidanand Rajghatta informs in Times of India that United States and other major powers will monitor the Indian economy and suggest steps to minimize risks it may pose to global growth under a new surveillance system developed at the World Bank –IMF. Rajghatta asks-“Shocking?”& then assures- “ ..New Delhi can do the same to others..”. Hang on, the real issue is not which country will monitor which country, rather, monitor what and under whose guidance (read IMF-Word Bank)! B.S Raghavan has not minced words –“I have known from my own experience of the UN system, that developing countries are members of international bodies, such as the IMF or the WTO, with far reaching mandates, often lack sufficient clout or guts to stand up to pressures from richer or more powerful nations ostensibly operating through those bodies...As every schoolboy knows , that isn't how realpolitik works. One can be sure that ultimately, it will be India and China, and not the five advanced economies lumped with them, that will end up as the intended targets of prying and arm twisting by the IMF...By now , however, every developing economies subjected to IMF treatment know knows how hard it can lean to get things done its way...I am surprised that India and China which have the most at stake in terms of maintaining the tempo of their economic growth agreed to do under the IMF ‘microscope’ in this astonishing fashion? “(Hindu Businessline). Has the world learnt to control greed that caused financial global crisis? The obsession with high growth numbers remains intact? Well, main street- you decide!!
17 April 2011
The other side: Many friends of SARCAJC have pointed that Corruption is indeed a huge problem in India but they have questioned why the 'civil society' has not given adequate attention to lack of security for women? Did you hear a word at Jantar Mantar about insecurities in which women live & work? Why is it important, take a clue from Kalpana and Ritu:
..other question that needs to be raised and discussed is whether high economic growth and woman's status in society are necessarily linked. As India becomes economically stronger, will the value and worth of its women also become higher?..Also is the availability of more money actually having the opposite effect? Is it reinforcing regressive attitudes, is it making people more conservative, getting them to hold to their beliefs that should find no place in a modern India? How else can one explain the story of India's disappearing girls? ...Dealing with this is at least as challenging as rooting out corruption. But will people come out and demonstrate for what someone called this 'invisible constituency'? (Kalpana Sharma. Hindu)
....More and more, we are becoming a society that doesn't give damn. We don't blink while we kill female foetuses package body parts in parcels and fly planes without qualification to do so. The line between what's right and what's wrong is getting increasingly blurred. Yet how many committees and laws can we formulate to stop people from misbehaving?...Even high economic growth and increased literacy hasn't influenced people to stop aborting female foetuses...Only when women learn to stand up for themselves will they be able to affect a change in the social conditions of their lives. (Ritu Bhatia. Mail Today).
13 April 2011
Banking Woes: The banks have been flushed with funds, thanks to excess liquidity created for high growth. But does it matter whether money is reaching? Pradeep Thakur informs on front page of Times of India that Delhi is among leaders in cheap farm loans in India. Delhi has consumed more than 570 billion of farm loans which came at nominal rate of interest of only 4%. Now that an achievement, right? You decide, remember that Delhi may hardly have any land for agriculture!! Is a posh Mall a farm? But this is banking for you! This is not all, Manju informs in Financial Chronicle that leading banks which have failed to meet their priority sector lending targets in March have provided additional credit worth Rs. 15 billion to Micro Financial Institutions (MFIs). This is despite history of bad debts arising due to lending to MFIs. But what if a farmer fails to return the loan to a bank? Check out Pipli Live- Bollywood Movie, at least!
￼7 April 2011
Anything Goes: Prabha Jagannathan reports on page 15 in Economic Times that according to Report by ESCAP report, India is worst affected due to climbing food prices. But Prahba has not sought the reason why food prices went up in India during the time when country saw record agricultural production. Even today newspapers suggest that government (read Union Agriculture Minister) mulls export of wheat and cotton. A friend of SARCAJC wonders if the permission to export be given after elections in five States so as to reap high international price? And don’t be surprised if the domestic retail prices of these commodities shoot after exports! But don’t the poor get their food supply though subsidized PDS? Dinesh Manhotra informs in Tribune that Comptroller and Auditor General (CAG) of India has pulled up the State government for its failure to ensure the supply of quantity ration to the people. Even after 60+ years of independence the country has no testing laboratory and trained manpower for quality inspection of foodgrains supplies though public distribution system (PDS).
11 March 2011
Just preaching?:Page three of Tribune highlights-" Rise in GDP rate not helping poor". Expressing their views in a conference, among the experts, was the editor-in-chief of Tribune who felt-" The problem lies in delivery, governance and implementation and the larger issue is equitable distribution of resources.." This is not all, he voiced concern at the indifference of the well-to-do people to the plight of the poor and warned that there could be a "violent revolution" if inclusive growth was not ensured. Next to this new report, is an advertisement by a private company that features an image of Mahatma Gandhi with his quote-" You must be the change you wish to see in the world". It goes on-".. We all have dreams....Yet seldom we realise that it all begins with us. Unless we change, the world will not..". Has Tribune shown the leadership for change? Take a clue that its front page that contains a detailed report with headlines-" 55 Indians make it to Forbes' billionaire Club" but there is not a word about growing inequalities, the write-up appears to be a proud statement-" The latest Forbes billionaires list for 2011 is all about marked shift in wealth creation from the advanced economies of US and Europe to BRIC countries...". A friend of SARCAJC points that Tribune has not initiated any campaign against corruption or carried out regular investigations to unearth corruption. What could be the reason? Take a clue from SARCAJC's newspaper watch on 28 November 2007
Tale of Two Cs:
‘One of the most important functions of good journalism is to keep watch on the abuse of public office and public money. And this is one of things that journalists most enjoy doing’. (Larry Kilman. World Association of Newspapers.8/6/05). Indian newspapers are also taking part in the fight against corruption. For a sample, let's view extracts of two Editorial of Tribune on corruption:
"....Where can the common man, particularly the poor who suffers the most because of corruption, should go when the administration is distant and indifferent …The remedy for corruption has to come from honest citizens who have to shut the door against the corrupt and the criminal and the political parties who harbour them. This will require considerable courage and may be some sacrifice in personal terms. The effort will be worth it - for the survival of democracy in the country and good".(Editor-in-chief of Tribune-H.K. Dua. 16/10/04. Tribune)
"...These days one cannot get any work done without greasing the palms of the officials concerned. However, will it be fair to punish a person on the ground that he had given some money to the staff to get his PF, pension or traveling allowance arrears cleared without which he would have gone from pillar to post? What about those giving tips to the postman for having delivered a money order, to the railway ticket collector for a sleeper berth at the last minute or even for securing the expeditious release of a friend’s body from a hospital mortuary? The law should be such that punishment should be given only to those who are really guilty of the crime of offering bribes for seeking undue favours and not otherwise…"(Today’s editorial in Tribune).
Notice the change? A Newspaper legitimising a type of corruption? Has corruption become an accepted part of life by the common man in India? Nope! The common man is still fighting against corruption and is not taking the ‘easy’ route.
Point to ponder- How far are newspapers playing a proactive role in supporting the common man in his fight against this menace and discouraging those who feed any kind of corruption? How many news reports do they carry on efforts by whistle blowers vis-à-vis news reports on ‘page three’ celebrities?
4 March 2011
Financial Watch: The Governor of Reserve Bank of India (RBI) has urged banks to raise deposit rates in order to encourage savings and lower lending rates to held the country to achieve double digit growth. Will the banks listen to Subbarao? Take a clue from State Bank of India (SBI), the largest public sector bank of India. It’s chairman has categorically states that interest rates have peaked and there would not be immediate hike. In light of Banks making a handsome profit at the cost of main street, net interest margin should come down. But who will bell the cat? No wonder why dubious advertisements in the classified section of newspapers continue to lure readers for so called concessions and all that.
3 March 2011
State of Unemployment:
What is the current state of unemployment in India? The latest Economic Survey reflects unemployment figures for 2007-08 from NSS 64th Round but ignores the higher unemployment figures revealed by the Labour Bureau for 2009. Look further, the thriving fake job advertisements in the classified section of various newspapers have much to add here. The front page of Dainik Jagran carries a news report on its front page that reveals the state of unemployment, much more that sheer statistics. Anil Mathur informs that in order to clear physical examination for Indian Railways, a five month pregnant woman ran 400 mts in 3 minutes. The officials of Railways told her not to run, but just imagine her desperation for a job (for which she had applied 4 yrs back) that did still ran. None of leading newspapers in English in Delhi have carried this news.
2 March 2011
Growth Watch: A day after the presentation of Indian annual budget, the Indian Business Tycoon, Mukesh Ambani has raised the flag of inclusive growth in his speech at the annual general meeting of the Federation of Indian Chambars of Commerce and Industry (FICCI). He did not mince words about growing inequalities in India-“There is a narrative one- 'rising India' or 'India emerging' Along with it runs another narrative. This narrative imagines the growth engine as a heartless mechanical monster that scatters millions behind, not even allowing them the privilege of being spectators to this miracle of growth...The India’s story is unsustainable without discovering policies and practical means to include these millions in the mainstream of our progress. There can be no peace if a billion-plus people are discontented...”. Even the main stream media seems to be pre-occupied with stories about this 'emerging India'. SARCAJC urges Mukesh to take the lead for inclusive development. How he could do, take a clue from Bapu - No Labour No Meal
6 February 2011
Look Around: For many obsession for high growth continues, yes, emerging power is a great thing indeed. However, Nissam Mannathukkaren has minced no words about the other side of the bright story. He feels signature of India at 61 is of unbridgeable divide, between billion-dollar homes and millions living in slums. Without inclusive development, the idea of India will remain the privileged domain of a few- " the real India will take another half a century to see Santa..All international opinion surveys of Indians show their tremendous optimism on the economic front and overwhelming confidence in a free market economy. But it would be a chimera to believe that the idea of India can be sustained by a galloping economy. This much-celebrated growth is in any case fracturing the idea of India by building oases of wealth amidst a desert of want..The idea of India in the present is one which curiously does not include most Indians...". (Hindu Magazine, supplement of Hindu). Point to ponder- How many top journalists connect with main street? How many have trained in development economics & use it too? No prize in getting it right!