Need India Specific Solutions

The UPA Government is contemplating allowing majority FDI in MBR/MPR (Multi Brand Retailing/Multi Product Retailing). This will open the doors for Carrefours and Walmart to enter our market.

This could prove to be the deathknell for the nearly 8 crore small businessmen, and the grocery shop next door.

In Al Khuwair in Muscat, where I live, there are very few neighbourhood grocery shops, mainly because Government do not allow them to employ expatriates, unlike Kuwait. Omanis dont fancy sitting and  managing a small shop. But still there were 3 reasonable grocery shops where one can get almost all that is required for day to day living. Their major competitor was Lulu Hyper Market which was about 4 kms away. But with Carrefour opening up in Bousher, and Mars already opened in Al Khuwair, these 3 shops found the going tough, and closed down one after another. One of these has been a landmark in Al Khuwair for nearly 20 odd years. These shops used to give reasonably personalized services, had ample parking space and was very convenient if one had to purchse some milk, vegetables, or tea bags. But these hypermarkets have swallowed them, made them non-competitive and I find it extemely inconvenient to go to a hypermarket to buy things which I might need for a day or two. It is a waste of time and effort as billing takes anything between 10-20 minutes, and one has to walk the length and breadth of a hypermarket in search of things. In addition, there is absolutely no one to guide you, in case you want some advice about a product. These hyper markets use salesmen only at the White Goods section, and every there most of them are uncaring and dont give a damn whether you purchase or not.

The entry of giants into organized retail will, contrary to Government claims of reducing food inflation, lead to a vice like grip by these retailers on our cost of living, apart from throwing many out of their livelihood. It is true that our Farm to Retail logistics is very inefficient, and controlled by greedy middlemen, who ensure neither the consumer nor the producer is benefitted. But the remedy to that is not FDI in Organized Retail, but a strengthening of the Distribution Channel and more effective Rural Marketing. Why can't we find India specific solutions to our problems, rather than importing solutions that dont seem to work at all.

The 'Loss' incurred by Oil PSU's during the past 5 years!!!!

Petroleum Prices have been raised at the drop of a hat in India during recent times, citing losses incurred by the PSU's IOC, HPCL and BPCL, as the reason for the hike.

I just did a quick review of the P&Lof these three companies for the past 5 years, and what I found do not show the Government or the PSU's in good light.

The Reported Profit after Depreciation, Tax and Adjustments in Rs Crores are given below;

As figures above show, the PSU's are not, and have never been sick, short of cash during the past 5 years, including late 2008-2009 when oil prices were so high, and the government refused to raise the prices because of elections.

Then what is the real reason for the hike in Petrol prices. Ha! That is another story. The tax content on Petrol is approx. 45%, which means government gets nearly Rs 30- 35 as tax on every litre of petrol sold. And this is big money. Money that allows government to splurge on non-plan, unproductive expenditure. The government's financial discipline is so poor, that we are back to the bad old days of pre reforms. Just look at the inflation and the interest rates (which has again been raised by 50 base points today).

The citizen is paying the price for the reckless spending and loot of this Government.

But dont believe the Government next when they dole out the excuse of loss making Oil PSU's as the reason for hike in Petrol Prices



The investment dilemma for the Indians

The Indians are in a dilema.

First, their savings have dwindled due to the spiralling inflation. And to add to their misery, they just dont have any avenues to invest and make the money grow.

Let us look at where people used to invest traditionally.

Gold - The Indians - rich or middle class or poor - always were crazy about Gold. But they always used to invest in the wrong gold tools - jewlellery. The best investment in gold is either gold bonds or 24 carat gold. But Gold has become prohibitively costly to the middle class and poor, and has ceased to be an option at all.

Real Estate - With land being scarce, and controlled by land mafia, people are wary of investing in land because of fear of reprisals from real estate lobbies and the mafia. Also, land prices are not going up, and hence there are hardly any returns short term. Then it is illiquid.

Stock Market - The stocks have been flat for while now, and is likely to be so till the next elections as this government doesnt invoke any confidence in the investors. Also, the small investors have been shortchanged and have been least protected. Insider trading is rampant,  and FII's rule roost. Things are not all that rosy on the equity front. Stay out of stock market for now, unless you want to invest in blue chips or select stocks as a long term investment. But do a thorough research before you do so. And most middle class dont have the skill sets to do such a research.

Bank Fixed Deposits - This is apparently attractive as the interest rates have rised steadily. But, the interest rates are still less than the inflation, which means your net wealth is decreasing if you are investing in FD's or Debentures. With inflation showing no signs of receding, despite bountiful monsoon for the last two years, and this year (and government having no clue as to how to tackle the inflation), it just doesnt make sense to invest in any instrument which doesnt meet the hurdle rate of 18%, i.e if your investment is giving an annualized return of < 18%, your net wealth will erode.

So where does one invest?

A tricky question. But I think the only option is to think a bit aggressively as a venture capitalist, and invest in early growth companies that require funds. These could be your friends company that has a good idea, or some small private limited companies having a good product or service that is struggling for funds. The risk is higher, but then so will the returns. But do proper due diligence before you invest. On the flip side, the GDP is growing, and with higher lending rates prevalent, entrepreneurs are not keen on debt financing. Hence, there is an opportunity for you if you are smart. But spread your investment across three or more sectors and in different ventures.

Tough times call for innovative thinking. This is the time to think out of the box, and think differently, and to take a bit more risk.



"Heightened" level of Security

Just 3 days after the latest Mumbai blasts, all the Airports and major towns' security level were raised to the highest. Or so claimed the Government.

But the reality is a joke. And a bad joke at that.

Listen to a traveller who boarded the flight from Chennai International Airport on 16th of July.

"The Airport is in a mess and a disgrace to the Country. Leave that aside. There was hardly any perimeter security. Anyone could walk upto the main gate with impunity and a couple of bombs if required. There were just two Security people at the main gate checking the Passport and Ticket. They did not even compare the photo in the passport with that of the passenger. On entering, there was a free for all. The visitors who had come to send off the passengers were just separated by a small partition, which some of them were seen to jump over with impunity. There were NO, I REPEAT NO, security personnel in the check in counter area. The most bizarre thing was that the Check in Baggages were NOT SCREENED at all prior to Check in. This has never happened to me in any airport in the world. The passengers were allowed to check in the baggages without either them or the baggages undergoing the security screening. Maybe they were screening once check in was done. But if something were to be found in the bags, then how do they apprehend the culprit?. The security check post immigration was alright, but one couldn't see anything special about it. And there were again no security personnel in the Aerobridge"

God save our country!!!

Lack of Pride as a Nation

The latest Mumbai blasts are already forgotten. This time we dont even have a clue as to who did it, there was no prior intel (In fact, has there ever been any prior intel? We never get any news of the police and IB busting a terror attack!!). The politicians made some perfunctory statements, the TVs carried the news for a couple of days, and then no one cares.

We don' value lives. The Government or the people don't feel that our national pride is dented when even a single person dies. Contrast this with what Israel does! They took on the Hezbullah just because 2 of their soldiers were caught by them. What happened in the war is immaterial. What is important is the message Israel sends out. Touch one of ours, and you are in for a fight. Ever wonder why Israel has not had a aeroplane hijack since Entebbe 1976? The message is loud and clear, and the recrimination swift. And damn international outrage.

Every country frames its policy based on self preservation, and preservation of the rights of its citizens. Look how US fought Pakistan tooth and nail to get their alleged CIA operative acquitted, look how Libya managed to get the Lockerbee bomber released, look how even Pakistan called the US Ambassador and gave him a demarche in the Fai Arrest. And contrast this with India's meek acquiescence everytime we are trampled on, be it terrorists, jehadis or even tiny nations like Bangladesh.

We shall regain our glory as a great nation, when we take a decision to stand up and be counted.

And that wont happen as long as the current government is at the helm.

Ostrich Mentality

The Government has taken an Ostrich like stand towards terrorism. It is clear as daylight to even a casual observer that Government inaction (gross negligence, tacit support - you may call it by whatever name) has led to the proliferation of Indian sleeper units of terrorists that have sprouted up during the last decade. It extends from Kashmir to Kerala. The influx of gulf money and the indoctrination the NRIs get there has been transformed into terror units that work in tandem and in isolation. 

The Central Government has refused to accept that there are Indian terror cells. It is ever so convenient to put the blame of Pakistan, so that we dont have to take any action, other than crying foul over Pakistan not doing anything. This is why, we hardly dug deep into the support given by Indians to the 26/11 Mumbai attacks. We have hardly convicted anyone within India during these past 15 years. Even the two who are convicted, Afsal Guru and Kasab, are leading royal lives in the jail, at State expense when they should have been dead and buried long ago. All one has to do to know how we pamper terrorists is to see the kind of medical treatment Abdul Nasser Madani gets in the Karnataka Jail, or earlier in Coimbatore Jail. He is undergoing high end ayurvedic treatment that he could perhaps not afford were he out of the jail!!!

We need to clean up the internal threat and sleeper cells on a priority basis, strengthen our intelligence gathering, and give police a free hand - but most importantly put behind bars motor mouth idiots like Digvijay Singh (and his master and mistress) who does more damage to our fight against terror by making reckless statements, than the ISI.

The threat, of late, is from within. Earlier we realize this, the better

ASSHOLE

At the latest Mumbai Blasts site, Manmohan Singh said, "Government will do everything to prevent attacks in the future"

ASSHOLE

Ministerial Medal Hopes!!!!

The Sports Minister Ajay Maken is in the news a lot these days, because of the exploding doping scandal in Indian Athletes.

Here is an excerpt from an interview of yesterday:

What kind of impact will the doping saga have on India’s chances at the London Olympics?

India’s image as an upcoming sporting nation has taken a hit. The girls who have been caught — we were expecting them to win medals at the Olympics next year.

 

Now, we know that politicians love to tell the worst absurdities and get away with it. But to tell that our women's relay team is a medal prospect in the upcoming London Olympics is stretching things a bit too far.

 

Can the honourable minister answer how many athletics medals have India won in Olympics in its history?

 

If we discount Norman Pritchard in the 1900 Paris Olympics, our tally is a good nice ZERO.

Katrathu Kai Mann Alavu, Kallathathu Ulagalavu

The policy of giving marks liberally in the School exams, leading to a ridiculous situation of students getting 100 out of 100 in all subjects is disquieting.

One can understand a student scoring full marks in a purely quantitative paper like Mathematics. But to give the student full marks in English, History, Geography or even Physics  is counter productive.

There are many pitfalls to it. I have personal experience of this as a teacher. Many of my faculty colleagues used to give nothing other than A grade (maximum grade) in the MBA Assignments, irrespective of the quality of the assignment. This led to average student becoming complacent, and refusing to push themselves, and the good students losing interest. The good students did not find any incentive in working hard, for they know it shall not result in any differential grade for them. Either way, the faculty was doing a disservice to the students.

The purpose of an examination is to give a proper feedback to the students, to help them identify their areas of strength and weakness, and take appropriate corrective steps. By giving near full marks, students get a false sense of feeling of knowing everything , when their ignorance level is very high.

As Avvaiyar wrote

"Katrathu Kai Mann Alavu, Kallathathu Ulagalavu"

meanign roughly "What you have learned is a mere handful; What you haven't learned is the size of the world"

Let us bow our head in reverance

The amazing thing about the One Lakh Crore plus treasure found in the cellars of Padmanabhaswamy Temple in Trivandrum is not the value of the treasure, but the fact that the Royal Family, who were the guardians of this treasure, had not even dreamt of using it for their personal purpose.

The Travancore Kings always ruled on behalf of Lord Padmanabha. They called themselves Padmanabhadasa. Even today, when the Royals leave the temple, they make sure to remove the dust from their legs, for they dont want to take with them even a small dust particle from the temple, that belongs to Lord Padmanabha.

In this era of Rulers looting public money, and emptying the treasury, should we not bow our head in reverance to the generations of Tranvancore Kings, who had jealously guarded the public wealth without any compensation. If this is not 'Nishkama Karma', as mentioned in Bhagavat Geetha, I don't know what is.

The worth of the treasure outstrips the public debt of the whole State of Kerala, which stands at around 80,000 crores. But to put things in perspective, this is only 70% of what A Raja and DMK stole in the Telecome scam (Rs 1.76 lakh crores)!!!

There is a debate as to who should be the custodian of this treasure unearthed.

Should there be any discussion on this? Who, other than the very people who guarded it zealously all these years? The Travancore Kings Family?

I recommend a visit by our PM, Cabinet Colleagues, Various CMs, their Colleagues to meet the Family members, and go through the carefully documented chronicles of what was once, the most prosperous of Kingdoms, to understand Rajaneethi and ethics/probity in public life.

Let us stand up, bow our head in salute of the Royal Family who showed us how a country has to be ruled and how peoples money should not be misused.