Manmohan Singh deserves our heartiest congratulations ... - cuts ccier

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Stakes at SaleThe government has sought torevive plans for the divestment ofminority stake in government-ownedcompanies. About nine PSUs maymake it to the market over the next fewmonths. An amount of Rs 45,000 to Rs53,000 crore could be raised throughsale of stake in select central PSUs.More than half of the proceedsmay come from two high-profile offers– 10 percent stake sale each in BSNLand Coal India. Similar estimatessuggest that stake sales in smallergovernment companies such asNHPC, RITES, Oil India and UnitedBank may bring in another Rs 6,100crore-Rs 6,850 crore. BHEL, Power GridCorporation and Rural ElectrificationCorporation are also likely to contributeRs 16,000 crore. (BL, 29.06.09)Core StatisticsThe Statistics Ministry hasstarted the process to operationalisethe newly passed Collection ofStatistics Act, 2008, by framing draftrules and guidelines that will enablebetter data collection anddissemination.Under the new Act, people orcompanies not divulging data wouldhave to pay a fine, thus making itobligatory for companies to complywith timely data collection activities.The Act also makes wilfulmanipulation or omission of data, acriminal offence, punishable by aprison term. The government is alsoplanning to finalise a list of data seriesthat will be called as “core statistics”,that is, numbers which are of nationalT R A D E & E C O N O M I C S – N E W S D I G E S Timportance, within the next threemonths. (BS, 05.05.09)No Blanket ClearancesFlooded with demands from bothprivate and public sector companiesfor fast track environmental clearanceof various power projects,Environment and Forests Minister,Jairam Ramesh, said the track recordof these companies did not inspiremuch confidence, and they needed tolook within to set right the damage toenvironment and ecology.Ruling out any kind of blanketclearance to power projects in thename of achieving targets, Rameshsaid he was prepared to help the powersector in getting early clearances, butthese companies would have to showgreater sensitivity on environmentalissues. Those not adhering to locallaws, and to environmental and forestissues in the development of projects,will face action. (TH, 30.06.09)Integrative DevelopmentIndia badly needs privateinvestment in retail. Theseinvestments are needed from bothIndian and foreign sources, but shouldinitially be restricted to the wholesalesegment, said the Confederation ofIndian Industry (CII) Northern RegionChairman, Harpal Singh.Referring to the newly openedBharti-Walmart ‘cash and carry’ outletin Amritsar, he said that privateplayers have more access toinvestment and, hence, can maintaingood storage and refrigerationsystems required to store perishableEAC Lowers Growth ProjectionWith slackening demand hitting Indiantrade more than anticipated, the PrimeMinister’s Economic Advisory Council (PMEAC)has lowered India’s growth rate forecast to 6.5-7 percent from earlier projection of 7.1 percentfor 2008-09 due to “painful adjustments to theabrupt changes in the international economy”.PMEAC chairman said the global crisisaffected the Indian economy through export andexport-related industries and capital outflows,which took place not because of lowerprofitability but foreign institutional investorshad their obligation to meet back home. Thepsychology of gloom and doom which essentially pervaded in theindustrialised countries was imported to this country. (FE, 05.04.09)items. Moreover, they can provideaccess to products from distantmarkets, such as fish from South Indiaand fruits from other countries, hesaid. (BL, 15.06.09)Intentions to ActualsUndeterred by global economiccrisis, Indian firms mostly in steel andelectrical equipment sectors, proposedinvestment of Rs 99,958 crore inJanuary.However, economists are scepticalabout these figures. Financial ratingfirm CRISIL’s Chief Economist D KJoshi felt the translation of theinvestment intentions into realprojects would depend on the globaleconomy. “These are only proposedinvestments. It is reflection ofintentions. During the current economicscenario to change the intentions intoactuals… it depends how the globaldownturn behaves in the comingmonths”, Joshi said. (BS, 11.05.09)India Strides Past ChinaIndia will have a gross domesticproduct (GDP) growth that is higherthan that of China in the next fewyears, said Oxus Research andInvestment Chairman, Surjit Bhalla inhis address to delegates at the fourthglobal meeting of the EmergingMarkets Forum.Bhalla said that while India willpost a GDP growth of more than ninepercent, China’s growth rate will bebelow eight percent in the not sodistant future. The strides that Indiahas taken in the last few years needsto be taken into consideration.(IE, 24.06.09)Low Inflation but High PricesThe inflation rate has dropped toalmost zero, but the prices for foodcontinue to remain high, especially foressentials such as rice, sugar andpulses. The prices of what is beingput on your table actually reflects thedemand-supply situation globally.Prices of rice and all pulses haveincreased though wheat prices,however, have been stable.Sugar prices have soared whileedible oil prices have shown adeclining trend in line with the globalmarket. Vegetable oil prices began theirdownslide mainly after crude oil ratescrashed. (BL, 03.04.09)10 / www.cuts-international.org April-June 2009 PolicyWatchManjul Cartoons
T R A D E & E C O N O M I C S – I N F E A T U R EDevelopment Strategies Still Matter– Yoginder K Alagh*We need to move away from intellectual orthodoxy inresponse to the global economic turmoilOur Planning Commission isgood, as good as the one Iserved for, with persons likeSukhomoy Chakravarti and theones I served with, like AbidHussain, Raja Chelliah and HitenBhaiyya. But jokes apart, the 11thPlan is a good document. Many ofits chapters are technically good.But, sometimes they do not hangtogether and there are no largerframeworks, with some numbers indifferent portions actuallycontradicting each other. Itsproduction and some of itstechnicalities are outsourced andthe novelty is attractive.Also there is an overarchingideology behind them which comesfrom the UPA and Sonia Gandhi’s National AdvisoryCouncil, which lends coherence. The section onagriculture and rural development is based on critiquesof the mistakes of the 1990s and work done on them.These essentials must continue.India and the world have gone through tumultuous timesin the last two years. But we have protected ourselvesfrom the worst ravages of the meltdown. The jury is stillout on whether that was on account of momentum orstrategy, with some like this column arguing that quicker,more coherent responses could have been possible. Itwill be a mistake though to believe that all that is requirednow is private research agencies to giving fact findingreports on sectors and regions.This mindset comes from a strong ideological positionthat development planning as a strategy was wrong.Treatises by government economists denying the growthof the eighties (a decade, one said, was without ‘vision’and so on), facile critiques of the National PlanningCommittee chaired by Nehru (to build up the case ofalternate visions) are all interesting pieces of writing buthave not been subjected to any serious professionalscrutiny. None of these approaches, for example, wereable to articulate the perception that India was growingfast from the 1980s. Apart from some Indian economistslike Nagaraj, Sebastian Morris, Arvind Virmani and yourcolumnist, this aspect was articulated largely byeconomists working outside India.These economists workingoutside India were from theBrettenwoods institutions andhad a largely coloured andjaundiced view of policyformulation in India. Alternatelythey reflected perceptions on Indiain their country of residence. Forexample some of the most severecritiques of India have emergedfrom liberal friends from theDemocratic or Labour Party.Remember Selig Harrisson and thefactual inaccuracies abundant inManjul Cartoons Francine Frankel. Okay, if youbelieve...that good governance isan Anglo Saxon monopoly. A veryastute Canadian friend recentlystartled me by saying that Indianfilm makers in his country, very critical of India were nevera part of the critical social discourse there. Ditto foreconomists leaving aside honourable exceptions.The upshot of the story is that there is a genuine needfor a debate on development strategy for India. It isrubbish to say that those who want it do not see themerits of market-based reform. But strategic developmentpolicy approaches are on the agenda and in this columnwe will chip away at them. These relate, among others tomaking agriculture grow faster in an uncertain world, openeconomy macro strategies, technology policies forindustry in a globalising world, organisational systemsfor public sector functioning and newer institutions withmixes of public and private initiatives, the South Asianregion, and larger questions of energy and water. Thesepolicies need to be integrated with the questioning beingraised on institutions all over the world. It’s not going tohappen if the establishment in India is wedded as it is toits own grooves and its global friends now in disarray.The inability of any ranking Indian authority to commentintelligently on Obama’s America or the intellectual turmoilin Europe and the propensity of the Delhi intellectualestablishment to stick to its earlier interlocutors is full ofbathos. But pathetic as it is, it also stops us fromreinventing our future, apart from reducing our influencein the region and the world. That has to change as we getout of another election.* Former Union Minister. The article appeared in the Financial Express, on May 08, 2009.April-June 2009 PolicyWatchwww.cuts-international.org / 11
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