29.08.2008

• US House of Representatives passes the Indo US nuclear deal
• Called the Berman Bill HR 7081, it was passed by the required two thirds majority. But a sizeable number of Democrats voted against the deal (298-117) in an indication that the financial crisis and the November presidential elections have taken a toll. In contrast, the Hyde Act was passed by a majority of 359-68 in 2006.
• But the final clinching step remains the approval of the Senate where a senator anonymously put a ``hold’’ on consideration of the bill in a tactic aimed at delaying the vote. Sources were confident that the Senate step would be completed soon and that there could be movement in the Senate as early as Monday.
• Impact of the financial meltdown on Indian IT sector
• Look at some meaningful commentary made in today's editorial on the issue:
• The tectonic events in the US have certainly hit growth and profit outlook for the Indian IT sector but to say that its strategic positioning has taken a knock is excessive. The 30%-plus growth was anyway not sustainable in the long run. Indian IT’s core strength of high-quality manpower and lower cost of delivery are as relevant as ever. The debate is actually not about offshoring, but about IT spending. Once that takes off, Indian IT companies would be back in business. Besides, big players have also built scale, acquired understanding of global markets, and have the balance sheet strength to explore other options. Infosys and HCL Tech, for instance, are locked in a battle for acquiring UKbased Axon, which specialises in implementing SAP AG’s enterprise software. So even while organic growth slows down, the global decline in asset prices make it possible for them to buy growth. The financial turmoil would also force Indian IT companies to look beyond the US and also diversify away from financial services.
• Presidential debates on TV
• They made their debut on September 26, 1960, when Kennedy debated Nixon in the first televised debate between two US presidential candidates.
• Kennedy won one of the most closely contested US presidential elections ever, with 49.7% of the popular vote as compared to Nixon’s 49.6%. Those who heard the debate on the radio felt that Nixon had won. However, on TV, JFK, who had shaved just before the debate and applied make-up, looked cool and collected unlike Nixon whose cheeks were showing signs of what razor-manufacturers term the five o’clock shadow!
• One oft repeated question that one faces while serving in bureaucracy runs like this: "How are you able to manage the political pressures?" Many a time people feel that there is too much of interference from politicos in administration and that we, the officers are at the receiving end for the wrong reasons. Look at how Sameer Sarma articulates an excellent response for this in his article.
• It is a must read for every IAS aspirant; or for that matter anybody who ever felt that he/she is at the receiving end of political personalities. Some excerpts:
• Models of administration:
  
• Rational decision making model: It starts with goal identification based on a known singular public interest, followed by listing of all possible alternatives with their consequences, and finally selecting the alternative, most likely to lead to goal achievement.
  Politics led to the breakdown of the rational model and weaker versions of technical rationality appeared to support decision-making. Applied to the IAS, three styles of decision-making are noticeable. First is Beckman’s hands-off approach in which IAS officers operate within the latitude given by the political executive. Second is Davidoff’s advocacy model, which suggests that IAS officers lean into the political system. Administrators are not disinterested bureaucrats, but actively advocate values. Third is Lindblom’s incremental framework in which public administrators decide in small steps based on their past experience of the political processes and the local context.
  
• Besides politics, Bryson and Roering’s strategic model added citizen-participation and goal achievement to decision-making. Adopting practices from the private sector, strategic planning focuses on programme goal-setting and achievement, through analysis of external opportunities and internal strengths and weaknesses of the organisation. Finally, the “practice movement” based on Habermasian ideas led to a paradigm shift during the ’80s, and the focus shifted to conversation with citizens and investigating the practices of practitioners, leading to well-known concepts such as, community participation, mediation and consensus building.
• In the same article he succinctly puts across the view point that political engagement is necessary for bureaucracy. Look at the very fine exposition:
• Smart politics is to step away from technical rigour and come to terms with political governance — working with political leaders, combining sound administrative practices and procedures with development agendas, and delivering on goals.
  
• Second, IAS officers have to go out and find support for their ideas because “no idea is good enough to succeed on the power of the idea alone”. Ideas have to fit into ongoing development agendas and administrative responses have to be based on an understanding of what the political leaders and citizens need.
  
• Third, in this internet-era of citizen involvement, understanding and respecting the decisions of the “public” and learning to use citizen-engagement opportunities to achieve goals become important.
  
• Lastly, pursuing initiatives from launch to finish is critical — things don’t get done on their own, and flexibility in making choices during followup leads to goal-achievement.
• In "Making fiscal federalism work" NK Singh lets us in on the challenges that are there before the XIII Finance Commission.
• A must read. Do so here. Entire article is good. So no excerpts for you.
• Indian aviation sector in red
• The IATA (International Air Transport Association) forecasts that Indian carriers are expected to suffer a cumulative operational loss of $1.5 billion (Rs 6,800 crore) in 2008 while the global aviation industry losses are expected to be around $4.1 billion. The industry had reported a profit of $5.6 billion last year.
• IATA Director General and CEO: Giovanni Bisignani
• Two of the major reasons why operational costs of our airlines are high:
• Jet fuel is 58% more expensive in India as compared to Singapore.
  
• Air Traffic Control (ATC) charges are around 33% higher than other countries.
• National offset policy on the anvil
• THE government is likely to announce a National Offset Policy, under which foreign vendors of all government departments including public sector units, would have to procure at least 40% of the contract value domestically within a specified time set by the government. The threshold limit for leveraging high-value procurement through offset programme would be Rs 100 crore per project. The offset agreement is proposed to be applicable to all high-value procurements.
• At present offset policy is seen mostly in defence procurements.
• The financial contagion spreads to Britain?
• Bradford & Bingley (B&B), Britain’s ninth biggest mortgage provider is in trouble because of losses on poor quality US home loans. B&B will be nationalised and its mortgage book merged with Northern Rock, the lender taken under state ownership in February. The government this month brokered the takeover of HBOS, Britain’s biggest home lender, by rival Lloyds TSB and is stepping in again.