NRI Voting Rights

Non-resident Indians (NRIs) will now have a right to vote in elections, with Parliament passing the relevant bill, even as government promised to bring in comprehensive electoral reforms legislation soon

This is a long overdue legislation. But I am afraid this is not going to benefit us much. As per the thinking, currently prevalent, we can register as voters in the constituency in India in which our passport address falls (what about those who have, say, a Kuwaiti address in the passport?). This means we have to fly down to India to vote. Unless and until they allow us to vote in the Indian embassies (which could be a logistical nightmare - imagine making arrangements to handle half a million voters? and again who do they vote for?).

It is also categorically mentioned in the parliament that NRI's will not be allowed to contest in the elections. This is manifestly unfair. If I have the voting right, I should have the right to contest the elections too.

The need of the hour is to provide for NRI constituencies based on the NRI population - for example: Kuwait, Saudi and Bahrain can be one constituency, UAE, Oman, Qatar - another. This way we will have NRI MP's who will be in a better position to air the problems of the NRIs, who contribute so much for the country.

But will anyone listen?

Wrong Right

This UPA government has found a nice way of tackling issues - Pass an act in the Parliament instead of getting down to the brasstacks.

Let us take the issue of irresponsible, self serving behaviour by the corrupt politicians and the civil servants. Instead of putting a few of them behind the bars, making them accountable and thus putting the fear of god into them, we have the great RTI- Right To Information Act, whereby you can get the information by paying a token amount. This is fine. But the question is, after that what do you do about it? Well, nothing!. Recently, when there were persistent queries on the Common Wealth Games corruption in the Parliament, the Sports Minister had the audacity to ask a MP to file a RTI if he wants the information. If that is the plight of a MP inside the Parliament, what about the common man. The politicians and babus have become bolder by the day.

We have a severe power shortage in the country. Most of the country is having power cuts ranging from 2 hours to 10 hours. Metros are the worst hit. Instead of augmenting the power generation capacity on a war footing, what do the Government do? They sign a nuclear agreement, and then waste two years preparing a nuclear liability bill. Is there any sign on new power plants coming up - the answer is none. So we are stuck with powercuts for at least another couple of decades.

The country is facing severe food shortage - at least in the retail market. This has send the food prices sky rocketing. The government does have enough grain rotting in the granaries. Instead of releasing the grain from the godowns to bring the prices down, and take bold actions to increase agricultural production and streamline agri product distribution, what does the Government do? It is contemplating passing the Right to Food Act. Great! Now the poor can be happy that they have the right to food, while they starve to death. Hey! what if we dont have food. We are empowered.

80% of the Government Schools have hardly any decent infrastructure. The teachers are conspicuous by their absence. No one gives a damn whether our children get decent education. The rich are not affected as they sent their kids to up market schools. But the poor kids, for whom it makes a world of difference, if they get good primary education hardly gets the education they deserve. Instead of spending a few thousand crores on school infrastructure, recruiting sufficient teachers and paying them good salary, and ensuring they are present in the schools during working hours, what does the Government do? It passed the Right to Education Act. Now the poor kids should not have any cause for complaining, as they have the Right to be educated. What if there is no school, no teachers or no one to teach them. Who cares?

What next? Right to Justice instead of increasing the number of courts, judges to speed up the cases? Right to a job instead of actually providing jobs? Right to use the Road, instead of making the roads motorable?

What if I go to my boss and tell him "Boss. I am empowering you with the Right to my Services. But I wont be doing any work. You should be satisfied with possessing the Right"?

Happy Onam

WISHING ALL OF YOU A VERY HAPPY AND PROSPEROUS ONAM

Sell local, not global

A small news item went unnoticed. It gives a pointer as to where the global consumption is headed for in the future. Hitherto, the Western Countries, led by USA, consumed using the savings of the Eastern Countries. The situation is changing. The governments of the Eastern countries have taken steps to discourage domestic savings to encourage domestic spending, to sustain their growing industrial economies.

Indian Automaker Maruti came into existence almost three decades ago, when no Indian cars were exported. Maruti, apart from enjoying the market leadership in India, built its business on its substantial export earnings, though it has to be admitted that they were not to the Western Economies, for whom the car was trash.

Maruti recently adopted a significant strategic direction change by deciding to curb its exports to only 15% of its total production, in order to concentrate on domestic markets. Incidently, Maruti's domestic market share went below 50% for the first time in more than a quarter of a century. It is facing tough competition from Tata Motors, Ford and GM who are cutting into its core segment of small car market. It is also paying a heavy price for not investing on localized R&D, but rather depending on technology import all these years. Their new models are just out of sync with the market psyche. Though it sold 50,000 more cars during the period April to July 2010, as compared to the same period in 2009, which denotes a 21% growth rate, the market has been growing at 34%, leading to a loss in market share. Thus, to protect its domestic market share, which is its bread and butter, Maruti is forced to limit its exports. The growth in domestic car market sale during recession is an indicator that Indians are spending more and saving less, which augurs well for the Indian economy.

Could we have envisioned such a scenario a few years back?

Sporadic Blogging

Pre-occupied with a couple of important issues. Blogging will be sporadic for another fortnight. Bear with me

Heading for a catastrophe on the economic front

The RBI has hiked the interest rates once again. This seems to be the only mantra government has for combating inflation, and it is not working. The UPA 1 government had promised a low interest rate regime once and it seems eons ago now. The Government is clueless.

The root causes for the sustained inflation are many. The UPA Chairperson, Sonia Gandhi, has a left of the centre leaning in her policies and is on a social sector spending spree, without any accountability. And the Government, cant or wont, do anything about it. Thus largesse is bestowed on the aam aadmi, with hardly a portion of the intended money reaching the beneficiary.

The pro business Government, headed by Manmohan Singh, has been giving massive tax concessions to the Business Sector over the past 5 years. This has ensured that the Government do not get the benefit accruing from the 8% GDP growth,  by way of substantial increase in revenues.

And Government has not taken any step to control its non plan expenditure. Waste is the name of the game with anything to do with Government, the Common Wealth Games scandal is only the tip of the iceberg. The money that should have spent on income generating projects, is lining the coats of the middlemen, who are using it for conspicuous consumption.

Thus, while revenue collection has not shown substantial growth, the expenditure has increased manyfold, resulting in inflation.

Add to this, the role of the black money. It is an open secret that Pakistan has been pumping in fake currencies into the country for a long time now. We have hardly taken any steps to counter this.

Thus there is far too much money chasing too few goods. Is there any wonder inflation is doubte digit?

We are in for a catastrophe if this situation persists.

Old wine in a new bottle?

The Car that has had the longest product life cycle, with the exception of Volkswagon Beetle, is planning an extension of its long long PLC well into the sixth decade of existence. The car that symbolised everything that is wrong with Indias economic policies of 60s and 70s continues its saga.

The Amby simply refuses to die. The iconic car that draws its lineage from Morris Oxford series II (Landmaster) and series III (Ambassador) is set to undergo the most ambitious makeover ever with heart as well as cosmetic surgery lined up to revive its sagging popularity. Though Hindustan Motors will continue to manufacture the current Ambassador for the taxi segment, it expects the new avatar to become the bread-earner for the company in 3-5 years. "The new Amby will have a retro design and sport cutting-edge engineering to compete on comfort and value for money. Overseas experts have been roped in for the metamorphosis. The new version will be ready by January-February 2011 for test trials and is expected to undergo validation by May so that commercial production can begin next July," chairman C K Birla told TOI on the sideslines of the AGM on Tuesday. While the platform and overall dimensions will be retained, the exteriors will be comprehensively redesigned by auto styling experts from Europe. MD Manoj Jha said the new car will look very different from the current Ambassador. "The new car will be a sibling of the Ambassador but the change will be so holistic that it will be a completely different vehicle. Apart from the new-look retro exterior, the interiors will be revamped. It will be powered by BS IV-complaint and BS V-ready 1.5 litre and 2 litre di-esel as well as petrol engines that are powerful and fuel-efficient. Overseas technology firms are working on each aspect of the car to ensure the vehicle is on a par with cont-emporary vehicles on Indian roads in terms of built quality and reliability," he said.

Some people never learn. Do they?

A saga of ineptitude and corruption

The UPA 1 Government was bad enough, but much of the blame for its non performance was attributed to a recalcitrant Left, with Congress pleading helplessness. The neo liberals were only too glad to damn the left for the ills of the Government. That the Government during the last one year of its tenure, in the post left scenario, hardly did anything was lost on them.

But UPA 1 is turning out to be an angel compared to UPA 2. Propped up by three self serving partners - Trinamool Congress, DMK and the NCP, who are a law unto themselves - the Congress has gone back to thinking that it has the divine right to do whatever it wants.

Inflation has started to not pinch, but bite the common man. Most of the commodities have become a luxury. With near Zimbabwe like inflation, Government decided to decontrol the petroleum prices ( I supported the move with a caveat that prices be allowed to fall as well when international oil prices fell - this has not happened and is not likely to happen ), resulting in inflation spiralling further. The Government harps about reducing the subsidy given to the underprivileged, while billionaire businessmen get away with tax exemptions (which is another form of subsidy) and land at subsidized rates (which is misused) that amount to many many times the subsidy given to the poor.

Corruption has always been a hallmark of Congress regime. But now it is so brazen that one shudders the impact it will have on an impressionable youth. Raja of DMA swindled thousands of crores in the auction of 2G spectrum, Pawar has been playing havoc with the food sector for 6 years now, less said about Mamata, the better- people are afraid to travel in trains these days for fear of accident, they are afraid to travel in our national carrier - thanks to mismanagement by Praful Patel, and travelling by roads is a nightmare, thanks to the delay in completion of Golden Quadrilateral/ north-south/east-west highways, a games no one wants which has overshot its budget by 1000 times and has already seen 11000 crores spent with hardly any returns has become a national shame. But the Prime Minister, and his boss - Sonia Gandhi, is oblivious to everything. There is absolutely no accountability. The PM is so toothless, he cannot even change the portfolio of Raja, that his junior congress ministers say boo to him everytime they see him. Never in the history of India has there been such an ineffective Prime Minister who is a failure on the Economic front, which is supposed to be his forte, on the National security front - Kashmir, Mao rebels, Radicalism in evidence, on the Foreign Affairs front - the Pakistan fiasco and US treating us like a vasal, cases in point and on the political front - the guy cant even win a lok sabha seat, and has to reach the Parliament through the backdoor Rajya Sabha.

When Maoists are slaughtering jawans, when kashmiri youths are pelting stones at the CRPF, when Quereshi ticks of our Home Secretary, when prices rocket, when a toilet roll is purchased for Rs 4000 (Commonwealth Games fiasco), when an audit reveals that our Jawans are being fed substandard food, when our women athlete dont feel safe under a male coach, when there is corruption all around, when the guilty are not punished, when we dont hang Afsal Guru who tried to blast the Parliament, when the PM dont or cant take action against the obviously corrupt - what we are seeing is a waning of authority and with it a loss in national pride. This is a precusor to a revolution.

A new world order in the making

Unfortunately, there is a hype that what is good for the West (read US and Europe) is good for the World. And anything that affects the Western economy catastrophic. This is quite untrue.

When the Argentinian currency crisis happened in 1990s, followed by the Far East Asian currency crisis (both incidently happened only because those countries followed the Western country led World Bank policies of opening up the economy when they were not quite ready), the West gave gratituous advice as to how to manage the deficit, how to tighten the financial system and how to open up the economy further. Now that the shoe is on the other foot, with Western economies proving to be financially indisciplined, running trillions of dollars of debt (in some cases more than 100% of their GDP) no one is speaking to drastric solutions and need for fiscal discipline. The US managed to temporarily stave off a currency collapse by printing more dollars, which I suspect Europe will also do in the medium term. The crux of the matter is that Western Economies are unsustainable if they follow their current model, which is heavily consumption and services based. The estern economies are sustained  by the Eastern Savings. Eastern countries are looking at improving their own consumption levels to avoid what happened to Japan during the past two decades. India is already showing signs of increase in consumption, which is one of the reason for the current inflationary pressure. With economy in a downward spiral, Western customers will spend less and less, leading to lesser consumption and ultimately the East/ other emerging economies like China, India, Latin America, Africa, will lose interest in the West altogether. A new world order is likely to emerge during the next quarter of a century.

Authority without Responsibility with the capacity to Spin

I had written about the fuel prices scenario last on 2nd July 2010. The details of the various taxes levied by the Government on Petrol and Diesel is given below

The next time the Government says oil companies are suffering from under recovery, all it has to do is to increase the Price without tax and reduce the excise duty component, thereby holding the overall price. But that would affect the revenue of the Government, limiting their ability to indulge in wasteful expenditure. They dont want that, do they?

Governance in India is all about authority without responsibility plus an ability to spin using a pliable media

Importance of Micro Finance

My obsession- microfinance - discussed by S A Aiyer in his weekly article. Worth a read.

The nationalized banks have served their purpose of creating a banking culture amongst the middle class. However, they have paid scant attention to the needs of the poor and small traders, that include vendors who make a living out of what they sell on a daily basis. The banks cry wolf over rural credit, claiming the default rate being high. But when have you heard a hue and cry over loan default by mulit billionaire industrialists, that run into  thousands of crores? - and this list includes the who's who of Indian business.

The Government led by the neo capitalists like Manmohan Singh, Montek Singh Ahulwalia are only concerned about the massive industrialization, forgetting that Indian economy is dependent on rural demand, that is sustained by agriculture and small traders. This is where micro finance can pay a huge role. There are pockets in our country where self help groups have their own micro finance schemes, that run amazingly smoothly. But the rural traders and vendors are at the mercy of loan sharks. I had written about this almost three years ago, which can be read here.

And nothing much has changed in this front during this past 3 years.