Indian Current Affairs: 03.04.2009

Finance & Economics

RIL started producing 2.5 million metric standard cubic metres a day (mmscmd) of natural gas from the D-6 block yesterday evening. The output is expected to go up to 5 mmscmd in a day.
Along with the oil it produces, the field will meet about one-sixth of India’s total oil and gas consumption. The country’s annual consumption of petroleum and natural gas is equivalent to 175 million tonnes of crude oil.
RIL’s KG gas will reduce the country’s import bill by $9 billion annually during peak production at the current price.
In 2007-08, India’s crude oil import bill was about $68 billion. The value of the gas over the 11-year life of the project is estimated at around $42 billion, at $4.20 per million British thermal unit (mmBtu). At this rate, the government’s share is expected to be around $14 billion, with $2 billion going to RIL’s bottomline every year.
As per the government’s gas utilisation policy, the first 15 mmscmd gas from KG basin will be supplied to the fertiliser units situated around the natural gas trunk pipelines. As per an official estimate, the allocation of 15 mmscmd gas to the fertiliser sector will spare the government a subsidy bill of Rs 3,000 crore.

International

Where is most of the money going to? For extra financing to the IMF. That is about $750 bn. The remaining $250 bn goes to enhance trade flows.

The IMF support consists of $500 billion of direct funding and a $250-billion issuance of special drawing rights. This will help the IMF support countries in financial distress. The $250 billion intended to revive trade flows will largely be in the form of guarantees.

What else did the group pontificate about? Quite a bit; to say the least. Whether or not these words get translated into action remains to be seen. Take a look at this report which gives a briefing on their declared intent. Also you a get a chance to look at the major world leaders in a group photo.

Martin Feldstein, a noted economist, estimates the loss of private demand at about $12 trillion.

CEPEA: Comprehensive Economic Partnership of East Asia. It is about economic cooperation among ASEAN+3, Japan, China, India, South Korea, Australia and New Zealand. That is 16 countries in all.
ASEAN+3: It refers to ASEAN 10 countries plus Japan, China and South Korea.

EAS: East Asian Summit of CEPEA countries is going to be held between April 11 and 12 in Thailand.

CMI was launched by Asean+3 to provide liquidity assistance to countries in difficulty through a system of bilateral swaps in the wake of the 1997 Asian crisis, subsequently multilateralised into a pool of about $120 billion.

CEPEA is arguably more fruitful regional architecture than an EAFTA for several reasons. CEPEA has adopted a more comprehensive approach putting cooperation as an important pillar rather than just trade facilitation and liberalisation in EAFTA. FTAs do bring trade gains but also inflict on the vulnerable sections some pains. So, the comprehensive approach adopted by CEPEA putting economic cooperation at the forefront is more fruitful especially in the context of East Asia with very wide development gaps between the members.

CEPEA is more inclusive a grouping compared to EAFTA and hence will be able to benefit from dynamism and other strengths of India, Australia and New Zealand. Simulation exercises find much greater welfare gains for the member countries in CEPEA compared to EAFTA. Furthermore, the synergies between the EAS members are more profound than in Asean+3. India’s software and services dominated economy complements well with hardware and manufacturing driven economies of other East Asian countries.

In France it is common for factory and other private sector workers to take their employers hostage in the aftermath of unpalatable decisions. In the ongoing global economic crisis, many companies in Europe including France are cutting down jobs, winding up operations etc. This is inviting the wrath of their workers who are increasingly resorting to 'boss-napping.'
We have heard of Sony's boss some weeks ago. Now we are hearing about Salma Hayek's husband Francois Henri Pinault being held hostage in his car by staff angered over 1200 jobs cuts at two of his stores.
Don't ask me Salma Hayek; who? Will you? She is the famous Academy Award winning actress seen in so many Hollywood movies.

Sport

India at 375 for 9 in the third test
In the Wellington Test match against New Zealand, India scored 375/9 on the first day of the third and final test match with the Kiwis.

Indian Current Affairs