Indian Current Affairs: 21.06.2008

The wholesale price inflation shot up to a 13-year high of 11.05% for the week ended on June 7. The steep hike in the price index, almost 2.3% as compared to the previous week (8.75%), has been primarily fuelled by a sharp increase in industrial and motor fuel prices. Inflation rates could cross 13% over the next few weeks, primarily driven by global oil prices. Crude oil continued to hold firm at $136.22 on Friday.
Even as I was writing our daily mail yesterday, the TV channels started reporting the story. We will have plenty on our plates in the coming weeks, if not months, on this issue.
Having tinkered with a slew of fiscal measures, the government appears to have run out of options on the fiscal front. It will perhaps start looking at RBI governor for tighter monetary conditions to tame inflation. So what should you expect? A rise in interest rates and mopping up of money from the markets.
But, how much can this help? At least in the near term it doesn’t hold any promise. Because, the current bout of inflation is basically driven by international commodity prices. Higher crude prices translate into higher inflation numbers for us with a bit of lag. That is what we are seeing in play.
Look at this pic which gives a bird’s eye view of the possible fallout.
The poor show on inflation front had already affected the stock markets. The BSE sensex tanked 517 points yesterday. Perhaps more downward swing is inevitable in the days to come.

Newspaper reports say that John McCain the US Presidential nominee from the Republican Party is all for nuclear power. Citing India, China and Russia as examples, he wants to revive America’s own nuclear programme by building 100 new plants to solve its growing energy problem.
Currently, there are 104 reactors in the country supplying some 20% of electricity consumed. No new nuclear power plant has been built in the US since the 1970s. Every year, these reactors spare the atmosphere from the equivalent of nearly all auto emissions in America.
US had stopped building nuclear reactors after the Three Mile Island incident in 1979.

Afghanistan is home to the Bronze Age site of Tepe Fullol; the Greco-Bactrian city of Aï Khanum; the trading settlement of Begram, which flourished in the first and second centuries AD; and the roughly contemporary necropolis of Tillya Tepe.
You can take a look at some of the art pieces from Afghanistan here.

Though the following was written in the context of Rajasthan, it applies to the nation as a whole.
The preponderant logic of mainstream politics has been identity management through quota-based patronage. The point now is to render such politics redundant in the long term. The BJP, on its part, can avert the imminent threat of a renewed caste agitation only if it starts engaging the Gurjars, and other caste groups, politically. An engagement that would articulate the question of empowerment, not merely as one of political visibility, but primarily of social transformation. That would effect rapid economic diversification and level the hierarchical social ground by breaking the traditional caste-occupation correlation.
It would, however, be too much to expect that a serious electoral contender such as the BJP would adopt such politics on its own, even as its rivals fan caste discontent against it to score quick electoral gains. Such engagement can actually take root only when all political parties come together to jettison the patronage-centric paradigm of cynical electoral politics.

In a very good article arguing for continuing with our efforts at the Doha round of talks, Prashant Goyal gives a very good answer for the above question.
A walk-out is not permissible as the WTO agreement is a package deal. A country can opt out of the WTO wholly. It cannot do so selectively i.e., agreeing to stay for say agriculture and opting out for manufacture and services etc.
Opting out of WTO on account of differences in agriculture is not sustainable. In a globalising world even if India were to ban imports, to tackle domestic surplus, our prices would still be affected. For instance, if Vietnam floods the world market with its competitive pepper, our domestic price of pepper would crash because of lowered opportunity for our exports. Moreover, we need the backup guarantee of liberal imports to maintain consumer price stability and safeguard our food security, in case of domestic shortfall.
When import bans will not work, the country can as well use the WTO forum to get an acceptable deal for its agri-exports.
The costs associated with rejoining WTO would be very prohibitive. Look at China for instance. It did not join WTO initially. When it decided to join, despite 50% of its population being dependent on agriculture, it was forced to bring down its average bound tariff on agri-imports to under 16% (India’s around 114%), for being allowed to accede to WTO.
Read his full article here. It is worth a read.

Para-banking activities include bancassurance, depository service, life insurance, mutual funds, credit and debit cards, etc.

Recent media reports suggested that in 2006, 17,000 farmers committed suicide in India. Is it normal or abnormal? Look at an excerpt from an article that appeared in today’s ET:
Keeping in view that about nine lakh people commit suicide in the world in a year, the world average when applied to India would mean 1.5 lakh suicides here (since one out of six people live in India). Similarly as roughly two-thirds of the people in India are connected with agriculture and allied activities, this would mean that if the world average norms had prevailed, then 100,000 suicides would take place in households engaged in agriculture and allied activities in India.

China is a bigger player in garnering CERs. Against its share of 30%, India and Brazil have only 28% and 14% share respectively.
But due to the recent floods and natural calamities in China its projects are expected to get delayed. This is making India and Brazil hot destinations for CER credits.
Of the total 1,084 project activity validated as CDM projects till May, 333 projects are from India. CERs issued to Indian projects till May amount to 39,334,542. CER futures for February 2009 on the MCX platform is trading at Rs 1,427 per contract.

Today it is 6.7 bn. It is expected to reach 7 billion in 2012, even as the global community struggles to satisfy its appetite for natural resources, according to a new US government projection.
China has a population of 1.32 bn and India has 1.13 bn.
The US ranks third, with 304 million.
Look at China’s population clock here.

Indian Current Affairs