13.05.2008

• India’s stand on “special products” and “sensitive products” at the ongoing Doha round of WTO talks
• What are special products and sensitive products in the first place?
• Both these are products which would be shielded from formula tariff cuts.
• Sensitive products are those which the developed countries can earmark (a much smaller percentage than the special products of developing countries) as sensitive at random. There is no criteria for sensitive products.
• Special products are those which the developing countries will be allowed to earmark (up to 15 to 20% of total farm products) as special. The criteria for inclusion as special product is that it should be food, offer livelihood security and used for rural development.
• Now the developed countries are arguing that there should be more transparency in the inclusion of products under the special products category by the developing countries. The transparency they are referring to is more relevant detailed data before ‘modalities’ are agreed so that members can assess the potential commercial impact of products being declared sensitive or special.
• India and Turkey have strongly objected to this, saying that there was no need for additional transparency.
• Fruits and vegetable production in the country
• India produces 12 mn tonnes of fruits and 109 mn tonnes of vegetables annually.
• Maharashtra tops the list of fruit producing states while West Bengal tops the vegetables producing states.
• The horticulture sector is constrained by wide spread fragmentation in supply chain, low productivity, and huge post-harvest losses, lack of cold chain and transport infrastructure, logistics and supply chain management.
• More on India’s demographic dividend or potential
• Following are the excerpts from the interview given by K Mohandas, the Secretary of the Ministry of Overseas Indian Affairs.
• The number of overseas Indians is said to be over 25 million, spread over 130 countries (this includes non-resident Indians, including Indian citizens residing abroad and persons of Indian origin who have acquired citizenship of some other country).
• With its vast reservoir of skilled and semi-skilled labour force, India is in a position to reap the benefit of this demographic shift in the West. It may be noted that India’s working age population (15-64 years), in sharp contrast to that of the EU, would increase to 68.45% in 2026 (this was 62.9% in 2006).
• Simultaneously, we are also reforming the emigration system. The number of emigration-check-not-required (ECNR) countries has increased from 53 to 174 recently. Now, emigration check is required only for 18 countries, out of which emigration is banned for Iraq. We have also relaxed the eligibility criteria for ECNR passport and so anybody who is class 10 pass or above would be entitled for a passport without the emigration-check-required (ECR) stamp and can proceed on overseas employment without any emigration check.
• ASER – It stands for Annual Status of Education Report
• The 2007 version is out. It gives very interesting facts about the status of our education in the country.
• A glimpse of the status can be found in this figure.
• Why should the USA need to understand the Asia better?
• In a well-argued article MK Venu points out to some interesting facts:
• As of June 2007, for the first time, total Asian investments in US long-term government securities exceeded that of Europe as a whole. Asia’s investment in US long-term government securities is $2,383 billion as against Europe’s $2,333 billion.
• Also, the total foreign holding in US financial assets, mainly equity and government paper, is likely to touch $12 trillion by June 2008. Soon this figure will exceed the US GDP itself. This is being driven largely by Asian countries that are generating massive current account surpluses each year by exporting to the west. The total foreign holding of US financial assets is growing at about 20% overall. However, the outstanding investment by China and West Asia in US securities is growing at over 40%.
• China’s holding in US equities and government debt touched $922 billion in June 2007. And this is poised to cross Japan’s $1,196 billion this year. China will thus become the largest foreign investor in US securities.
• You don’t borrow so heavily from people you dislike, right. Also, you try to understand and be nice to people from whom you borrow so much! This is the dilemma that the US faces today.
• Industry growth hits 6 year low
• The sharp drop in industrial production in March to a six-year low of 3% may have triggered fears of a slowdown but economists are still holding on to a 8% plus growth projection for 2008-09. The optimism amongst policymakers and economists, however, is not shared by industry players who believe that high interest rates and rising input costs have started impacting demand.
• The high inflation, however, rules out any possibility of rate cuts to stimulate growth. The industrial production, as measured by the Index of Industrial Production (IIP) grew at a disappointing 3% in March 2008 compared to a robust 14.4% growth in March 2007. As a result, the industrial production growth slipped to 8.1% in 2007-08 from 11.6% in 2006-07.