30.05.2009

Politics & the Nation

• Equal opportunities commission
• The constitution of such a commission is under consideration for quite some time. It's expected to look into grievances from groups; rather than individuals.
• Look at the minister speak on this:
• After the third tier of decentralization through panchayats, the commission will provide for substantial equality, as against one that is in response to court decisions. Through the commission, it will be possible to ensure equality in a holistic manner, which would pre-empt conflict that gets into courts.
• With Azhagiri accommodated in Cabinet, can Stalin be far behind?
• This is what precisely happened. Stalin gets elevated as Deputy CM in Tamilnadu. This is a development that is on the expected lines.

Finance & Economy

• Good news on economy front
• The Indian economy grew at higher than expected 5.8% in the quarter to March. This was on the back of strong growth registered in services and agriculture.
• The country registered an impressive 6.7% growth in fiscal 2008-09. Perhaps it may grow faster in the current fiscal.
• The optimism is bolstered by signs recovery / good news seen across the globe. Japan's industrial production jumped the most in 56 years in April while in UK house prices jumped unexpectedly in May. German retail sales climbed the most in four months. Even in US, its economy did less badly than expected in the first quarter. It contracted by 5.7% instead of the forecast 6.1%.
• The escalation in government expenditure though has resulted in the fiscal deficit touching the 6.2% mark of the revised GDP. If you take the off-budget subsidies into account, this figure could very well touch about 13% of the GDP.
• Even the forex reserves have hit a one year high of $260.6 bn during the week ended May 22.
• Remember the small paragraph answers that you gave on monsoons as a kid?
• Let's relive them.
• Monsoon rains are key to cultivation of kharif crops, which account for nearly 60% of the country's farm output. About 235 mn farmers are dependent on monsoon rains for reaping a good harvest. The monsoon also replenishes water levels in reservoirs, aiding irrigation and hydel power generation.
• Goa's Feni gets GI status
• Feni, you might know, is basically manufactured from cashew fruits; though it is also manufactured from coconut palms. But it is the cashew feni that is distinctly Goan. Feni comes under the category of 'country liquor.'
• Now this has got the GI status It joins the ranks of Darjeeling Tea, Mysore Sandalwood and Scotch Whisky.
• With this the product can be registered internationally and only Goa will have the right to produce Feni. The GI certificate currently assigned to Feni is valid for 10 years.
• GI certificate lends authenticity on the unique properties a region could offer to a product, such as weather and water that could not be replicated in any other part of the world.
• Feni is manufactured by what is called the 'postal method.' It essentially involves a three tier distillation process.
• MVNOs finally get the government nod
• THE Telecom Commission, the highest decision making body of the communications ministry, on Thursday cleared the proposal to allow mobile virtual network operators (MVNOs) to launch operations in India.
• MVNOs offer mobile services without owning cellular networks or airwaves (spectrum) on which telecom signals travel. Their business model involves buying airtime from existing operators that own telecom infrastructure and selling it to consumers under their own brand.
• However, the Commission said that MVNOs cannot go for multiple pareinting in India. This means, an MVNO can tie-up with only one operator in an area for their services. But operators can have tie-ups with any number of MVNOs.
• MVNOs would be given licences for a 20 year period.

International

• What is the G4?
• It is the group of four countries -- India, Germany, Brazil and Japan. This grouping is about securing permanent seat on the UN's Security Council alongside the P5 -- the permanent five.
• For a country of the size of North Korea, what size could its military be?
• It is 1.2 mn strong!!
• Now you know what is meant by a militarist state?

Language lessons

• affray: Noun
• Noisy quarrel; a noisy fight.
• eg: They have been charged with offences including affray, intentionally causing injury...

29.05.2009

Politics & the Nation

• Prime Minister's first trip abroad
• Prime Minister Manmohan Singh’s first trip abroad will be to Russia next month for the meetings of the Shanghai Cooperation Organisation (SCO) and BRIC (Brazil, Russia, India and China) grouping. 
  
• Mr Singh will travel overseas for the SCO meeting, which is set to take place on June 15 and 16 at Yekaterinburg in Russia.  The focus at the SCO meeting, where India will participate as an observer, will be on regional issues. Among the issues that the grouping has commented on recently includes the current situation in Pakistan, which also has observer status in the grouping. 
• He will then participate in the BRIC leaders’ summit, which will take place on June 16 evening at the same place. Incidentally, this is the first-ever meeting of the head of states of BRIC countries. At the meeting, the Indian side is expected to seek greater unity among the countries at international meets, so that the grouping can play a larger role in the international decision-making process. 
• PM makes him mark on cabinet formation
• The PM added 59 new ministers — 14 at the Cabinet level, seven ministers of state (MoS) with independent charge and 38 MoS — after reconciling conflicting interests and aspirations of his party colleagues, his party’s need to shore up in vulnerable areas and injecting an element of youthful energy. 
  
• The PM’s grip on economic policy-making was tightened with appointments in key ministries. The sign of his determination to place people he wanted where he wanted came last week itself when he refused to accommodate DMK ministers in key infrastructure ministries. The DMK had to contend with Cabinet posts in telecom, fertilisers and chemicals and textiles. 
  
• Look at the various areas where the PM is expected to have his undivided attention in the next 100 days:
  
• Road Transport and Highways 
  
• 1. Accelerate pace of awarding road projects 2. Clear backlog, award another 35 highway projects 
  
• Civil Aviation 
  
• 1. Inject life-saving capital to the turbulent airline industry 2. Allow FDI in domestic carriers by foreign airlines 3. Revitalise national carrier Air India 
  
• Telecom 
  
• 1. 3g and Wimax auction within 2 months 2. STD at 25 p and local calls at 10 p per minute 3. Will have to take call on Bharti-MTN 
  
• Steel 
  
• 1. Achieve production target (120 million tonne by 2012) 2. Raw material security 
  
• Oil & Natural Gas 
  
• 1. Transparent oil subsidy mechanism 2. Tax exemption to natural gas production 
  
• Commerce 
  
• 1. Check falling exports. 2. Ink free trade agreements with Asean and South Korea 
  
• Finance 
  
• 1. Financial sector reforms, fiscal measures to boost economy 2. Disinvestment 
  
• Power 
  
• 1. New capacity addition 2. Boost nuclear power 
  
• Corporate Affairs 
  
• 1. Evolve a new company law, bankruptcy code 2. Fully operationalise Competition Commission of India 
  
• Complete list of the Union Council of Ministers and their portfolios: 
  
• MANMOHAN SINGH: Prime Minister,general administration, personnel, atomic energy 
• CABINET MINISTERS 
  
• Pranab Mukherjee: Finance 
• AK Antony: Defence 
• P Chidambaram: Home 
• SM Krishna: External affairs 
• Kapil Sibal: HRD 
• Anand Sharma: Commerce & industry 
• Mamata Banerjee: Railways 
• Kamal Nath: Roads 
• GK Vasan: Shipping 
• Sushilkumar Shinde: Power 
• Murli Deora: Petroleum 
• A Raja: Telecom, IT 
• Vilasrao Deskmukh: Heavy industries
• Virbhadra Singh: Steel 
• Dayanadhi Maran: Textiles 
• M Veerappa Moily: Law 
• Ambika Soni: I&B 
• Sharad Pawar: Agriculture, consumer affairs, food & PDS 
• Kumari Selja: Tourism, housing 
• Pawan Kumar Bansal: Parliamentary affairs 
• Ghulam Nabi Azad: Health 
• S Jaipal Reddy: Urban development 
• Vayalar Ravi: NRI affairs 
• Meira Kumar: Water resources 
• BK Handique: Mines, northeast development 
• CP Joshi: Rural development, panchayati raj 
• Farooq Abdullah: New/renewable energy 
• Mallikarjun Kharge: Labour 
• MS Gill: Sports, Youth affairs 
• Subodh Kant Sahay: Food processing industries 
• Mukul Wasnik: Social justice 
• Kantilal Bhuria: Tribal affairs 
• MK Azhagiri: Chemicals & fertilisers 
  
• MINISTERS OF STATE WITH INDEPENDENT CHARGE 
  
• Praful Patel: Civil aviation Prithviraj Chavan: S&T & also MoS in PMO, parliamentary affairs Sriprakash Jaiswal: Coal, statistics and programme implementation Salman Khurshid: Corporate affairs, minority affairs Dinsha Patel: Micro, small & medium enterprises Krishna Tirath: Women and child development Jairam Ramesh: Environment and forests 
  
• MINISTERS OF STATE 
  
• Shashi Tharoor: External affairs Preneet Kaur: External affairs Ajay Maken: Home Mullappally Ramachandran: Home NN Meena: Finance SS Palanimanickam: Finance MM Pallam Raju: Defence Jyotiraditya Scindia: Commerce & industry Gurudas Kamath: Telecom, IT Sachin Pilot: Telecom, IT E Ahmed: Railways K H Muniyappa: Railways Jitin Prasada: Petroleum D Purandareswari: HRD Srikanth Jena: Chemicals & fertilisers Saugata Ray: Urban development V Narayanasamy: Planning, parliamentary affairs Panabaka Lakshmi: Textiles A Sai Prathap: Steel Harish Rawat: Labour KV Thomas: Agriculture, PDS Bharatsinh Solanki: Power Mahadev Khandela: Roads RPN Singh: Roads Dinesh Trivedi: Health S Gandhiselvan: Health Sisir Adhikari: Rural development Pradeep Jain: Rural development Agatha Sangma: Rural development Sultan Ahmed: Tourism Mohan Jatua: I&B Dr S Jagathrakshakan: I&B Mukul Roy: Shipping D Napoleon: Social justice Tusharbhai Chaudhary: Tribal affairs Arun Yadav: Sports, youth affairs Prateek Patil: Heavy industry & PE Vincent Pala: Water resources
  
• A few important observations that cannot be missed on the Cabinet formation
• The composition of the Manmohan Singh team suggested a power shift — from the cowbelt to states in the South, West and East. About 40% of the council of ministers is from Kerala, West Bengal, Maharashtra and Tamil Nadu. 
  
• Most of the important portfolios will be handled by leaders from these regions. Another noteworthy feature was large representation of Dalits. There are as many as 10 of them which is a clear indication that the Congress is determined to bring the section back to its fold.
  
• Youngest minister in the Council of Ministers: Ms. Agatha Sangma (28), MoS for Rural development
• Oldest minister: SM Krishna (77), Cabinet Minister for External Affairs
• Powerful commentary on the draconian nature of security laws by Gutam Navlakha, Civil Rights activist in the context of Binayak Sen case.
  
• Once a person is accused under security laws, rule of law turns lawless, due process is diluted and the threshold for evidence lowered. Half truths peddled by cowardly officials get media coverage. 
  

Finance & Economy

• Is disinvestment in PSUs a reformist measure?
• Today's ET article argues that it need not necessarily be.  Take a look at the reasons.
• New gas finds by RIL can catapult India into the big league of gas producers
  
• NEW gas finds by Reliance Industries (RIL) in the Krishna Godavari (KG) basin, if validated by Indian regulators, may place India among the top 15 gas producers in the world. RIL’s joint venture partner the UK-based Hardy Oil and Gas on Wednesday announced the discovery of 9.5 trillion cubic feet (tcf) of gas in the D-3 block of the KG basin and another find of 10.8 tcf in D-9 block. Neither of these finds has been certified yet by the Indian upstream regulator, but could potentially raise India’s proven reserves of natural gas to a significant extent. Blocks refer to areas, running into thousands of square kilometre, where companies have been allowed to search for oil and gas.
• As at the end of 2007, India's proven gas reserves were stated to be 37 tcf.  If this current find adds another 20 tcf, then with 57 tcf of proven gas reserves India will occupy a place of pride among gas producers of the world. 
  

International

• US names new ambassador to India
• US PRESIDENT Barack Obama has named former Democratic congressman Timothy J Roemer as the new US ambassador to India.
  
• He will replace David C Mulford, who finished his tenure and left at the beginning of the year. The Obama administration had appointed Peter Burleigh as US Charge d’Affaires for the interim period. 
  
• Pak keeps in piling up nuclear arsenal
• A US congressional report has said that Pakistan, which has 60 nuclear warheads that are targeted at India, is continuing with its production of fissile material for weapons, and is constantly adding to its nuclear capabilities. 
  
• “Deterring India’s nuclear weapons and augmenting Pakistan’s inferior conventional forces are widely believed to be the primary motivation for Islamabad’s nuclear arsenal,” says the report.
  
• “Islamabad continues to produce about 100 kg of highly enriched uranium for weapons every year,” it adds.
  
• Man Booker International Prize goes to Alice Munro
  
• Acclaimed Canadian short story writer Alice Munro has bagged this year's Man Booker International Prize worth 60,000 pounds, pipping celebrated Bengali author Mahasweta Devi and Indian-origin Nobel laureate V S Naipaul in the clash of the world's literary giants. 
  
• 77-year-old Munro is the third person to win the prestigious award, which is given every two years since its creation in 2005. Earlier, it was awarded to Albania's Ismail Kadare and Nigeria's Chinua Achebe.
  
• The Man Booker International Prize is affiliated with the Booker Prize and can be won by an author of any nationality providing their work is available in English.
  
• Her first collection of stories, 'Dance of the Happy Shades' (1968) was highly acclaimed and won the Governor General's Literary Award, Canada's most prestigious literary prize.
  
• Her success was followed by 'Lives of Girls and Women' (1971), which won the Canadian Booksellers Association International Book Year Award.
  
• In 1980 'The Beggar Maid' was shortlisted for the annual Booker Prize for Fiction.
  

Language lessons

• fealty: Noun
• The loyalty that citizens owe to their country (or subjects to their sovereign)
  
• eg: FOR old-time family retainers like Arjun Singh and HR Bhardwaj, loyalty certainly did not pay. Their fealty used to ensure them a place of pride in any Congress Cabinet, but today, their inability to offer anything more than loyalty has put them out in the cold. 
• factotum: Noun
• A servant employed to do a variety of jobs
  
• eg: The appointment of Salman Khursheed as the new corporate affairs minister — a job held in the previous government by the Lalu factotum Prem Gupta — is proof, if indeed it were needed, that with the shackles of allies off, Manmohan Singh now means business.
• homilie: Noun
• A sermon on a moral or religious topic
  
• doppelganger: Noun
• A ghostly double of a living person that haunts its living counterpart
  

27.05.2009

Politics & the Nation

• One more root cause theory to explain the eruption of violence in Punjab
• Read this ET editorial in full to know the explanation.  But some excerpts:
• AT THE root of the sudden violence in Punjab is a coalescence of the issues of basic social inequalities, the consequent attempt by the under-privileged communities to seek an alternative space and agency as well as the latter becoming embroiled in the larger political matrix. 
  
• One of the critical factors behind the mushrooming and growth of these Deras is the fact of social, religious and political space being monopolised by the ‘upper caste’ sections. And with the Deras gaining in presence and power as ‘alternative’ religio-political entities, a conflict with the established ones was almost inevitable. 
  
• The speed with which violence erupted shows the deep social fissures which shape this sectarian polarisation. 
  
• NREGS
  
• In the context of the political posturing that is seeing the possibility of NREGS being extended to all the 604 districts in the country and the fact that such an extension entails a fiscal burden of about Rs. 53,000 crores, a study conducted by a team from Harvard University came out with some startling conclusions:
  
• The potential of NREGS for poverty reduction is far from fully realised 
  
• What needs to be emphasised is that higher NREGS wages undermine the self-selection of the poor in it 
  
• What is perhaps worse is that populist hikes in NREGS wages may further erode its potential for poverty reduction
  
• Want an explanation for all the three conclusions?  Get it in this ET op-ed piece.
  

Finance & Economy

• Banks are set to lower their lending rates
• GOVERNMENT-OWNED banks plan to cut lending rates by 100-150 basis points — one basis point is one hundredth of a percentage point — within the next fortnight, after a finance ministry directive to lower interest rates in line with falling cost of funds. The rate cut is expected before June 12, when the finance minister is scheduled to meet the chiefs of public sector banks.
  
• With PSBs cutting rates aggressively, private banks will come under pressure to slash rates. Fresh loan offtake is expected to see a substantial jump.
  
• Government may speed up the disinvestment process in profit making PSUs
  
• PSUs -- especially the power majors NTPC, NHPC & Power Grid may be permitted to tap the market at regular intervals over the next few years to mobilise resources for carrying out their ambitious expansion and modernisation plans. This will gradually bring down government holding in these companies.   However, the government may never allow its stake to fall below 51% in these entities.
  
• The disinvestment exercise is expected to fetch around Rs 60,000 crore, while an equal amount will be mobilised by these public sector undertakings (PSUs) to carry out their expansion plans. The amount raised will help the companies meet part of their funding needs. The sector requires over Rs 10,00,000 crore in the next three years. 
  
• Assets must back bonds
• This is how things should be; isn't it?  But it is a norm only for you and me.  Not for the big bond issuers, so far.
• But now SEBI appears to be changing the rules by mandating that companies raising money through ‘secured’ bonds and debentures should make sure that the papers issued are fully backed by assets. The move could change the way companies mop up debt in the local market. 
  
• For years, companies sold debentures with an underlying security that was worth a fraction of the amount raised. For instance, an issuer selling Rs 200 crore of bonds to bulk investors like insurance firms, mutual funds and banks usually does it by creating security of say, Rs 1 crore or even less. The security shown could be a small property owned by the company selling the bonds. 
  
• Even though such bonds were categorised as ‘secured’, technically the security cover available was only for a slice of the issue amount. Few investors questioned the practice, better known as negative-lien in the securities market. All that mattered was the rating on the debenture. It was a given that a triple-A borrower would not default. 
  
• Despite the inadequate security cover, issuers preferred to call the debentures ‘secured’ because it was easier to sell and worked out cheaper. 
  
• FBT to be done away with?
• This is a view that appears to be fast gaining ground.  Introduced in the 2005-06 budget proposals, it garnered a mere Rs. 8,000 crores as revenue last year, which is just 2% of the direct tax collections.
• This tax has come in for severe criticism right from the inception because of the huge paper work that it entails, besides being employee unfriendly, as most of the employees feels that it ultimately devolves on them.
• Even in countries where it is introduced, it has received lot of opprobrium.  
• Apart from India, FBT was introduced in Australia, UK, US, New Zealand and Japan.
• India's health insurance industry
  
• THE Indian health insurance industry stands at Rs 5,125 crore with only a small section of the population (around 2%) being covered so far. With a compound annual growth of around 37% (FY02-08), the health insurance industry in India is one of the fastest-growing segments among other non-life insurance segments. 

Medicine

• Mouse genome sequenced
  
• The mouse genome sequencing effort began in 1999, and a draft sequence was published in 2002.
  
• Scientists have reportedly finished sequencing the mouse genome after a 10-year effort.
  
• With this, the mouse (Mus musculus) is the second mammal after humans to have its complete genome laid bare. 
  
• The genetic sequence of mice is about 75% similar to our own.
  
• Humans and mice share a remarkable level of similarity, despite having evolved independently for the last 90 million years.
  
• The cost, borne by US and UK sequencing centres, is estimated to exceed $100m (£62m).

26.05.2009

Politics & the Nation

• Dera Sachh Khand followers resort to violence
  
• TWO persons were killed after violence broke out in several places of Punjab as followers of Dera Sachh Khand burnt trains and blocked highways in protest against murder of a sect leader in far away Vienna. Dera followers armed with swords, sticks and stones were on the streets in Jalandhar, Phagwara, Hoshiarpur and Nawanshahr towns. 
  
• The prime minister appealed for calm.
  
• Cycle Aila wreaks havoc
• WEST Bengal and Bangladesh were in the eye of the storm on Monday as Cyclone Aila, whipping up speeds of 70-110 km, lashed the coastal regions, leaving 21 dead and leaving thousands homeless. Orissa also faced the fury of the cyclone. 
  
• Basic infrastructure, including power, railways and aviation collapsed. Kolkata almost came to a standstill as commercial establishments and educational institutions remained closed and public transport went off the roads. 
  
• Government turns a blind eye to NREGS' downside?
  
• It is very well known that there is a sudden and sharp rise in the wages of workers signing up for the NREGS.  It is also well known that these high wages were keeping rural inflation high, threatening to keep workers away from normal economic activity in rural areas. This had prompted it to consider limiting states’ freedom in fixing the pay out. That may change now with the new dispensation expected to take a humanitarian view rather than one based on economic wisdom.   

Finance & Economy

• The finance minister has a tough job on hand
• Look at some of these figures and we know why:
  
• For the first time since 2003-04 the Centre’s direct tax receipts (Rs 3, 38,212 crore) are short of not only the original target but also the revised target. Corporate tax collections have fared particularly badly, up barely 11% as against the previous year’s growth of close to 30%. 
  
• Revenue deficit, which at 4.4% of the GDP (according to revised estimates for 2008-09) was already 340% higher than the budget estimate. 
  

International

• Winds of economic hope sweep across the globe
• Take a look at this news report and you will surely conclude so.
• BTW do you know what is the Central Bank of Germany?
• It is Deutsche Bundesbank.  Its President (counterpart of our RBI Governor) is Axel Weber. 
• Water scarcity and development
  
• Here is an excellent piece written by one of our favourite authors - Jeffrey D Sachs.  A must read.  An excerpt worth our attention:
  
• Many conflicts are caused or inflamed by water scarcity. The conflicts from Chad to Darfur, Sudan, to the Ogaden Desert in Ethiopia, to Somalia and its pirates, and across to Yemen, Iraq, Pakistan, and Afghanistan, lie in a great arc of arid lands where water scarcity is leading to failed crops, dying livestock, extreme poverty, and desperation. 
  
• Extremist groups like the Taliban find ample recruitment possibilities in such impoverished communities. Governments lose their legitimacy when they cannot guarantee their populations’ most basic needs: safe drinking water, staple food crops, and fodder and water for the animal herds on which communities depend for their meagre livelihoods. 
  
• Politicians, diplomats, and generals in conflict-ridden countries typically treat these crises as they would any other political or military challenge. They mobilise armies, organise political factions, combat warlords, or try to grapple with religious extremism. But these responses overlook the underlying challenge of helping communities meet their urgent needs for water, food, and livelihoods. As a result, the US and Europe often spend tens or even hundreds of billions of dollars to send troops or bombers to quell uprisings or target “failed states,” but do not send onetenth or even one-hundredth of that amount to address the underlying crises of water scarcity and under-development. 
  
• N Korea conducts nuclear test in defiance of the world
  
• NORTH Korea on Monday said it ‘successfully’ conducted a nuclear test and also appeared to have fired a short-range missile, following up on earlier threats issued after the UN Security Council criticised a rocket launch by the Stalinist state. 
  
• India joined the international chorus of condemnation of North Korea as the test. External affairs minister S M Krishna, who formally took over his new assignment on Monday, criticised North Korea saying that such a test was a violation of international commitments and warned that this development would have a negative impact in the region. 
  
• The tests are seen as a muscle flexing exercise in the backdrop of the US announcing a new effort to restart stalled talks with North Korea to end its nuclear programme. The tests, which come after the scare in Pakistan of nuclear sites falling into the hands of the Taliban, also signal a failure of disarmament talks that were aimed at preventing North Korea from carrying out a nuclear test. This is the second test by North Korea, which last tested a nuclear weapon in 2006 and has continued to develop its nuclear programme maintaining that it was working towards building up its "nuclear deterrent for self-defence.’’
  

Personality

• Who is Dr. Binayak Sen and why is his Supreme Court ordered release making it to national headlines?
  
• Dr. Sen was lodged in Raipur central Jail for more than two years since May 14, 2007. for his alleged links with the Left wing extremists in Chhattisgarh -- without any concrete evidence against him.  He is also outspoken against the state-sponsored Salwa Judum, a controversial counternaxalite movement in Chhattisgarh.
  
• The Chhattisgarh government has charged Dr Sen under the stringent anti-terror law, Unlawful Activities Prevention Act. He was booked for acting as a courier for an alleged naxalite. It was alleged that Dr Sen had passed on certain letters to a naxalite leader lodged in a Chhattisgarh jail while visiting the prison as a doctor. 
  
• He is also the winner of the prestigious Jonathan Mann Award for Global Health and Human Rights for his services to poor and tribal communities and his unwavering commitment to civil liberties and human rights. 
  
• Look at this chronology of events, if you are interested.

Language lessons

• harrowing: Adjective
• Extremely painful
• eg: The consequences are harrowing: drought and famine, loss of livelihood, the spread of water-borne diseases, forced migrations, and even open conflict. 

25.05.2009

Politics & the Nation

• India and the demographic dividend
  
• In 2020, an average Indian is expected to be only 29 years old against 37 years in China and the US, 45 years in West Europe and 48 years in Japan. This is the “demographic dividend” that research analysts keep harping about — by 2020, the working age population in India is expected to grow by more than 47 million people. 
  
• In 1985, after the UN declared it as the International Year of the Youth, Indian policymakers set about preparing a National Youth Policy, which was adopted in 1988, which was then revised in 2003. Despite this, few initiatives were taken to translate these policies into action on the ground. 
  
• Some facts from Indian Census 2001 in this context:
  
• The total youth (13-34 years) population is 390 million (38% of total population) and is expected to rise to 440 million by 2020. 
  
• 70% (271 million) youth reside in over 600,000 villages. 
  
• 72% (282 million) youth are literate. 
  
• 41% of literate youth are 13-19 years old, 23% are 20-24 years old and 36% are in the 25-34 years old. There is no significant difference among males and females. 
  
• 59% of literate youth are male. Little over 7% (21 million) of literate youth are graduates and above, 53% have passed higher secondary (12th class). 
  
• 62% of graduate youth are male. 
  
• Arogyasri scheme of AP
  
• This scheme which is launched two years ago on Andhra Pradesh and is considered the brainchild of the Chief Minister Mr. YS Rajasekhara Reddy is getting accolades from far and wide.  It is also believed to be one of the main reasons for the YSR government being voted back to power.
  
• Arogyasri is a medical insurance scheme of sorts.  The premium for Aargoyasri is borne fully by the state. Every family below the poverty line gets an annual health cover of Rs 2 lakh. The state government has a tie-up with private insurer. It has empanelled 367 private and public hospitals as service providers.  Protocols are stringent, be it in the selection of medical procedures or the empanelment of hospitals. The database of beneficiaries and software system to track each and every case are in place.  Over 940 medical and surgical packages are listed and the costs are fixed by a panel of doctors from the trust.
  
• A year ago, the centre rolled out the Rashtriya Swasthya Bima Yojana (RSBY) to provide health insurance for families below the poverty line. The beneficiaries are entitled to hospitalisation coverage of up to Rs 30,000. Only 30 lakh smart cards have been issued so far. But Arogyasri has achieved greater depth and has been found to be working satisfactorily.
  
• Know the difference between a category and a group
  
• A category has diverse or heterogeneous elements unlike a group which is sociologically similar in its composition.
  

Finance & Economy

• Oil producers to have their profits capped
• THE government reportedly is planning to cap profits of crude oil producers such as Oil & Natural Gas Corporation (ONGC), Oil India (OIL), Reliance Industries (RIL) and Cairn India as part of a transparent and sustainable subsidy-sharing system for the sector.
  
• The proposal to levy a special oil tax was part of the recommendations of the BK Chaturvedi Committee, appointed to look into oil pricing as a replacement for the current subsidy-sharing plan that has been criticised for its lack of transparency.  The committee had recommended that public sector oil companies — ONGC and OIL — should contribute their revenues beyond $75 a barrel to the central exchequer, while private producers need to chip in with 50% of their incremental earnings.  
  
• The government spent a staggering Rs 1,03,182 crore on oil subsidies in 2008-09 to keep the pump prices of motor fuel and cooking gas under control. The enormity of the burden, which is almost 2% of the country’s GDP, is prodding the Manmohan Singh government to take a hard look at its hydrocarbons policy.  
  
• Inclusive growth
  
• If you are ever asked to write on the challenge of inclusive growth, you can't get a better a piece than this one.   Some excerpts:
• India’s growth story has sometimes masked the challenge underneath — as many as 600 million people continue to depend on agriculture as a source of livelihood, yet agriculture has been growing at only 3% annually. At the same time, India’s workforce is growing. We currently have around 500 million people in the workforce and this is expected to grow by about 20 million each year for the next ten years. By 2020 India will account for a fourth of the world’s total workforce. And it will be a young workforce. By then, the average working age is projected to be 60+ in both US and Europe, 45 in China, and merely 29 in India!
  
• But this workforce has a serious problem: unemployability due to lack of the necessary skills and competence that is essential for today’s environment. 
  
• For India to prosper, it must integrate its diverse population, especially its youth. They are the future. But this can only be done if the 4Es are in place — education, employability, employment and excellence. With the 4Es will come the 5th E — economic growth. 
  
• Indian cities to get a 25K cr bonanza
  
• The World Bank is reportedly favourable to extending a loan of Rs. 25,000 crore to develop urban infrastructure over the next five years.
  
• The government is expecting to receive a major portion of this as an IDA (International Development Association) loan under the World Bank, as the interest charges from loans extended by IDA attract a rate of about 1% only.
  
• BTW the World Bank had lent a total of $1.7 bn to Indian FY 09 as against $2.1 bn in FY08.
  

International

• GM borrows $4 bn more from the US Treasury 
  
• With this borrowing, the total it has borrowed from the US Treasury touches $27 bn by June 1.
  
• This year so far, it had borrowed $19.4 bn.
  
• It is well on its way to filing for bankruptcy protection but has been fighting shy of it because of its continuing efforts to negotiate with its bondholders and employee unions.
  
• But bankcruptcy appears to way forward.
• New flu virus has mysterious origins
  
• Researchers are now saying that the virus responsible for the recent outbreak of swine flu pandemic might have been circulating undetected among swine herds somewhere in the world.  The odd mixture of humna, pig and bird genes in teh new virus, has puzzled the researchers.
  
• The recent outbreak of swine flu pandemic has seen more than 11,000 people infected in 42 countries and has claimed 42 lives.
• Obama's move against the credit card issuing banks
  
• The US President has signed a bill clipping the credit card industry's wings.  The bill largely codifies a set of rules issued by the Federal Reserve last year and puts them into effect in February 2010.  
  
• It sharply restricts credit card issuers' ability to raise interest rates on existing balances, to charge certain fees and to slap cardholders with penalties.
  

Personality

• Sir Ranulph Fiennes
• On May 21, 2009, at the age of 65, he became the first person ever to cross both ice caps via both poles and to also climb the world’s highest mountain. He is the first British pensioner and the third oldest man in the world to climb Everest.
  
• The oldest to climb Everest at the age of 76 is Nepal’s Min Bahadur Sherchan, a former army officer.
  
• Sherchan broke the record of retired 71-year-old Japanese school-teacher Katsusuke Yanagisawa who climbed Everest in May 2007
  

Language lessons

• skittish: Adjective
• Unpredictably excitable (especially of horses)
  
• eg: With investors skittish over the indebtedness of the United States, stocks could be subjected to more volatility if the allure of US assets dims further. 

23.05.2009

Politics & the Nation

• About MAC and NCTC
  
• Following the Mumbai terror attacks a multi-agency centre (MAC) is operating 24x7 to collate terror-related information.
  
• To supplement this another agency -- the NCTC (National Counter Terrorism Centre) is proposed to be set up to draw up operational plans to counter the 'specific' terror threats.  It will also oversee the implementation of these action plans in close coordination with the Central and state police agencies.  It is expected to have due representation of intelligence agencies, Central paramilitary forces and Army.
  
• However, the NCTC proposal is still in a nascent stage and the new government will be discussing its possible legal backup with the law ministry. The options available include a special Act to empower the NCTC to plan and oversee counter-operations against terror or its creation by an executive decision. 
  

Neighbours

• Nepal to choose a new Prime Minister
  
• After obstructing parliament for three weeks, Nepal’s Maoist party finally allowed the house to convene yesterday with caretaker prime minister Pushpa Kamal Dahal Prachanda making an impassioned valedictory address, in which he blamed neighbour India, Nepal’s president Ram Baran Yadav, his allies and the army chief, Gen Rookmangud Katawal and warned of a catastrophe in the days to come. 
  
• The address paves the way for the election of a new Prime Minister today when the 601-member house meets for the purpose.
  
• Prachanda accused New Delhi of basing its relations with Khatmandu on the humiliating Sugauli Treaty signed between Nepal and the British East India Company in 1816, which forced Nepal to concede about a third of its land. He further said that New Delhi had failed to upgrade its ties even after the sea change that overtook Nepal following the Maoist insurgency and the fall of monarchy. 
  

Finance & Economy

• Flagship schemes to get a regulator?
  
• The new government is reportedly toying with the idea of settiup an independent regulator to monitor the progress of key flagship programmes and submit quarterly reports, as it tries to ensure that the funds earmarked for such social sector schemes reach the intended targets in a timely and efficient manner. 
  
• The importance of this proposal arises from the fact that roughly a quarter of the Rs 1,20,000-crore allotted for these schemes in the last fiscal had remained unspent, and the UPA political leadership believes that an independent and autonomous regulator will be able to analyse reasons for this and suggest solutions. 
  
• Officials in the finance ministry and the ministry of statistics and programme implementation are reportedly chalking out the contours of this new body, slated to be in place within 100 days of the new government taking charge. 
  

Personality

• Bank of Japan (BoJ) Governor: Masaaki Shirakawa
  

Language lessons

• jettison: verb
• Throw away, of something encumbering; Throw as from an aeroplane
  
• egregious: adjective
• Conspicuously and outrageously bad or reprehensible
  
• eg: "an egregious lie"

22.05.2009

Politics & the Nation

• India's defence spending and failure of offset policy
  
• This is an excellent piece that appeared in today's ET on the subject.  Worth a read.  Some excerpts for our record:
• From Rs 12,000 crore in 2002-03, India’s capital defence procurement budget is expected to touch an estimated Rs 54,000 crore in 2009-2010. If the projected estimations are any indication, India is likely to spend nearly $100 billion on military procurement during the current five year plan (2007-12) and $120 billion in the next plan period (2012-17), the latter coinciding with the last phase of India’s ambitious military modernisation plan. It is thus no surprise that India is a weapons merchants’ paradise.
  
• Despite having a sizeable state-owned defence industrial base, the indigenous contribution to meeting military requirements is pegged at less than 30%. 
  
• A set of policy initiatives have followed since 2002, when the government decided to open up the defence sector for private participation and allowed 26% FDI. The government also started implementing many recommendations made by the Kelkar Committee in 2004 toward strengthening self-reliance in defence. It consequently introduced ‘direct offsets’ in large defence contracts under defence procurement procedure in 2005 (DPP, 2005). Offsets provisions have further been elaborated in DPP, 2006 and DPP, 2008 respectively, with offsets banking clause being the latest addition in the latter. 
  
• Why is that the defence offset policy has not delivered results?
• While noting can be a substitute for a full explanation given in the above referred article, we make an attempt at noting the concise points:
• Ill-defined offset obligations.
  
• Lack of clarity about offset obligations.
  
• Consensual nature of agreements between suppliers and recipients makes the results non-quantifiable.
  
• Establishmentarian mindsets of the government officials leaves the foreign suppliers clueless while keeping the local businessman frustrated in making the offset policy work.
  
• The state of India - neither being too undeveloped and nor being well developed -- is a contributing factor for the failure of the offset policy takeoff.
  
• Centralised Lawful Interception and Monitoring System 
  
• This is a Rs. 450 crore initiative from the government that seeks to monitor all communication traffic in the country.  In the wake of the Mumbai terror attacks, such monitoring has become a necessity.  Read this report to get more details.
  

Finance & Economy

• About horizontal and vertical agreements and anti-competitive practices
  
• Agreements that will not be considered anti-competitive are called vertical agreements, which include deals between a manufacturer and a distributor or a retailer aimed at reducing cost and enhancing efficiency.
  
• However, another class of agreements called horizontal agreements, or a cartel, will be presumed as anti-competitive, with the onus of proving innocence lying with the company charged with cartelisation.
  
• The country’s newly formed competition regulator is unlikely to consider agreements among companies aimed at boosting efficiency as anti-competitive, unless it can be conclusively proved that such pacts hamper fair competition.
  

International

• Pakistan Enduring Assistance and Cooperation Enhancement and (PEACE) Act 2009
  
• This proposed legislation of the US, which is still at not passed as Act, looks at tripling the US aid to Pakistan.  A key congressional panel has passed this legislation granting $1.5 billion annually in non-military aid to Pakistan after dropping an explicit demand to stop cross border terrorism into India.  However it mandates that Pakistan will have to prevent cross border attacks into neighbouring countries and cease support, including by any elements within the Pakistan military or its intelligence agency, to extremist and terrorist groups.  This is an obvious reference to the support cross border terrorism has been receiving from Pakistani establishment - whether or not it is state controlled.
  
• The panel has also dropped another explicit demand for giving US access to nuclear proliferator AQ Khan as one of the conditions for aid. Instead, it now seeks US “access to Pakistani nationals” who are connected to the proliferation network. 
  
• There could be many more changes before the legislation becomes an Act.
  
• India is keenly watching the progress of this legislation in the US.
  
• Sri Lanka promises power to Tamils
• Read this story.  It is really heartening to note that the Rajapaksa government is making the right noises and appears genuinely set for some devolution of power.  It should not go back on its promises and get on with the devolution as envisaged in the 13th Amendment and the Indo-Sri Lanka peace accord.  
• The 13th amendment to the Sri Lankan constitution gave effect to the devolution provisions of the Indo-Lanka Accord, signed in July 1987 by President J.R. Jayewardene and the Indian Prime Minister, Rajiv Gandhi.
  
• It sought to devolve power to newly instituted provincial councils throughout Sri Lanka. It contained three lists detailing respectively the areas of government devolved to the provinces (List I), the powers retained at the centre (the Reserved List — List II) and a Concurrent List (List III) of shared functions which were ultimately controlled by Parliament. The provincial councils were elected in November 1988, but a number of clauses in the amended constitution allowed for the blocking of substantive devolution.
  
• Western developed countries see their credit ratings fall!
  
• Without our noticing it, many a western country is losing its credit rating.
  
• Britain became the fifth western European Union nation to lose its rating because of the economic slump, following Ireland, Greece, Portugal and Spain. 
  
• The UK’s debt load next year will be 66.9% of GDP, exceeding Canada’s 29.1% and Germany’s 58.1%, according to forecasts by the International Monetary Fund. 
  
• The US will be at 70.4%, and the 16-nation euro area at 68%, with France at 70.6%, according to the IMF. 
  

Language lessons

• ossified: Adjective
• Set in a rigidly conventional pattern of behaviour, habits, or beliefs
  
• eg: ...the Left might find itself too ossified to change for the better.
• pork barrel: Noun
• A legislative appropriation designed to ingratiate legislators with their constituents
  
• eg: The malaise in the infra area in the recent past was aided by poor governance and pork barrel politics in spite of Dr Singh assuming command of the situation. 
• braggadocio: Noun
• Vain and empty boasting
  
• eg: While the government babus engaged in braggadocio, the private industry also joined the bandwagon.

21.05.2009

Politics & the Nation

• Congress does need allies
• A very well written editorial piece in today's ET argues that Congress should not be taken in by grandiose ambitions.  It urges caution on the part of the GOP (Grand Old Party) in formation of the government and in running the country.  Worth a read.  Sane advice.
• Once in a way we can treat ourselves to some funny political commentary.  Look at this excerpt:
  
• Chennaites remembered how the octogenarian CM had gone on an indefinite fast on April 27 with the stated objective of protecting the lives of thousands of Tamil civilians trapped in the fighting in Sri Lanka. As things turned out, the fast lasted just a few hours and was called off once the Sri Lankan army promised not to use heavy weaponry like shells or rocket-launchers. Which was interpreted as a cease-fire! Karunanidhi’s political opponents quipped that the CM had gone on a post-breakfast, pre-lunch fast in order to win a majority of the Lok Sabha seats from TN and thus ensure that his son, daughter and grand-nephew were all rewarded with weighty portfolios in the new Cabinet! 
  
• Today is anti-terrorism day
  
• Anti-terrorism day is being observed throughout the country on the occasion of the 18th death anniversary of former PM Rajiv Gandhi, who fell prey to the designs of terrorists.
  
• The Day is being observed to generate awareness in the country among all sections of people, about the danger of terrorism, violence and its evil effect on the people, society and the country as a whole.
  
• The objective behind observance of the Day is to wean away the youth from the terrorist/violence cult by highlighting the suffering of the common people and showing how it is prejudicial to the national interest.
  

Finance & Economy

• Most of the gains recorded in stock markets in the last two trading days is attributed to 'remorse buying.' What does it mean?
• It means is that investors / fund managers are trying to put idle funds to good use, so as not to underperform the market. 
  
• Know what is street financing?  
  
• It is a method of money laundering -- converting black money into accounted money.
  
• This is how Street Financing works: a person makes a draft payable in the name of another person from any particular bank for an amount less than Rs 49,000. This person on whose name the draft is made further endorses it in the name of another in lieu of payment for purchase of goods or services. However, the chain doesn’t end here and the draft is used as a payment check, without real money changing hands. In the end, there is a clique, who deposit these drafts in their bank accounts and take a commission of 1-2% to encash them. 
  
• A very good commentary on the reasons for the global financial crisis coming from Benjamin Cohen.
  
• Benjamin Cohen is the Louis G. Lancaster professor of international political economy at the University of California, Santa Barbara. He is the author of a dozen books, including The Geography of Money(1998) and The Future of Money(2004). His latest book, International Political Economy: An Intellectual History,was published in 2008.
  
• Explaining the reasons for current global crisis he says:
  
• "I regard the lax regulatory environment to be one of the two principle causes of the crisis–the other being an excess of liquidity. In the US, the regulatory framework failed to keep up with innovation in financial markets. And the result was that whole segments of the financial sector were totally outside the regulatory framework–be it hedge funds, private equity firms, or the ‘shadow banking system.’ Most classes of derivatives were not directly regulated by anybody. Compounding this was the so-called Washington consensus or neo-liberalism that emphasised reducing regulatory controls–which actually happened during the 1990s. The result was an environment in which innovations were allowed to go well beyond threshold risk...So by 2007, some 42% of corporate profits in the US was coming from the financial sector. As recently as 2000, the figure was 7%. There is no question that these profits were inflated by certain activities that are now going to be restricted or prohibited and so there maybe much lower profits–what may be considered ‘normal profits’– in the financial sector."
  
• This is the kind of stuff that you can use in your interviews and GDs.
  
• About NREGS funding
  
• The National Rural Employment Guarantee Scheme (NREGS), which promises 100 days of work to every rural household with an adult volunteer, received Rs 34,000 crore last year, including the previous years’ unspent balance. 
  
• Of this, only Rs 24,000 crore has been spent. The balance Rs, 10,000 crore would be the opening balance for the NREGS this financial year. 
  
• The interim budget had allocated Rs 31,000 crore for the current year, which is expected to be substantially raised in the full budget, given the ballooning unemployment due to the economic slowdown. As the funds were carried over from last year, the money ready for spending this year would be more than what would be allocated in the full budget documents.
  
• Want to get a feel of a Black Swan event?
  
• This term, popularised by a former Wall Street trader and author, Nassim Nicholas Taleb, is an extreme event that cannot be predicted by the complex mathematical models used for trading by these banks.
  
• The recent surge in Indian stock markets following the UPA victory proved to be one such Black Swan for some foreign banks' trading desks. Read this story in full.  You will understand what we are trying to say.
  

International

• India becomes the 15th largest investor in US treasuries
• According to the latest data shared by the US Treasury Department, India’s outstanding exposure to US government bonds rose to $38.2 billion in March 2009 from $18.3 billion in October 2008. The latest tranche of investment into treasuries has made India the fourth-largest creditor to the US after China, Japan and Russia during this period. 
  
• Look at this graphic to get a picture of the largest investors in US treasuries.

Language lessons

• dirigisme: Noun
• Economic and social control by the state
  
• eg: If the government is serious about walking the tight rope between another stimulus package and steadily worsening public finances, it must shed its earlier dirigisme, especially in the context of disinvestment.
• You will find it interesting to read about this word in Wikipedia.  Do so here.
• intrepid: Adjective
• Invulnerable to fear or intimidation
  
• eg: A number of intrepid theories have been floated to explain the dollar's continuing strength.
• incipient: Adjective
• Only partly in existence; imperfectly formed
  
• eg: The SEC (Securities Exchange Commission) is blamed for missing the incipient financial crisis and failing to detect Bernard Madoff’s $65 billion Ponzi scheme.

20.05.2009

Politics & the Nation

• IT’S been a watershed election, and none more so than for Indian women. 
  
• For the first time women have breached the 10% mark in the 543 member 15th Lok Sabha with 59 of them entering the Lower House.  Nearly a third of these 59 are under 40 years of age.
  
• But take a look at women's representation abroad!
  
• Britain has over 19% women in the current House of Commons, electing 128 of them in 2005, most of them from the ruling Labour Party. 
  
• The US, Italy, Ireland and France also have approximately 14% to 16% women MPs, with the progressive Swedes setting a shining example of gender parity with 47%. 
  
• For the first time since women in Kuwait were allowed to vote and contest, of the 16 who did, four won — all professionals with doctorates from the US.
  

Finance & Economy

• SEBI roots for anchor investor
  
• SEBI is reportedly overhauling existing norms for raising funds from bourses.
  
• On the anvil is a new entity called the anchor investor, who will get 25% out of the 60% reserved for institutional investors in a public offer. This investor can be defined as “a strategic investor with a longerterm view compared to others”. This will help the company raise a lumpsum amount at one go, but there will be no special pricing for the anchor shares. 
  
• It’s also planning to cut the time between opening of an IPO and listing from 21 days to 15 days
  
• Country's aviation industry losses & debt
  
• The Indian airline industry is facing one of the worst crises with combined loss of nearly Rs 10,000 crore in 2008-09. 
• The three big carriers Air India, Kingfisher and Jet Airways are estimated to have a total debt in excess of Rs 30,000 crore on its books. 
  
• DCGI proposes to bring cancer drug pricing under NPPA
  
• The importance of the move arises from these facts:
  
• Cancer, the second-largest noncommunicable disease, accounts for 3.6% of the total deaths in India. 
  
• According to a study published in the Indian Journal of Cancer, more cases were projected in the 45-55 and 65-70 age groups for women and men, respectively. 
  
• Oral and lung cancer in males and cervix and breast cancer in women account for over half of all cancer deaths in India. 
  
• The Indian breast cancer drug market alone is expected to double from $35 million in 2007 to $64 million by 2012. 
  
• Incidentally do you the current DCGI?  It is Surinder Singh.
• The incoming Finance Minister will have his plate full
  
• With so many reform measures stalled in their tracks during the previous government, courtesy the Left parties, the incoming FM will have a lot of work to do.
  
• Read this article which explains some of the important measure that are craving attention.
  

International

• US President imposes targets for achieving fuel efficiency
  
• The US Presient is reported to have announced that automakers must meet average US fueleconomy standards of 35.5 miles per gallon by 2016, four years sooner than previously planned.  This is seen by many as a means to achieve greater cuts in green house gas emissions. 
  
• Why are American banks proposing to return the TARP money that they so eagerly took?
  
• You might be aware of the $700 bn fund established by the US government for the Troubled Asset Relief Program.  Some of the major banks, which have taken billions from out of this fund are now proposing to return the money to escape restrictions on compensation and hiring that were imposed on TARP recipients in February. 
  

Language lessons

• wangle
• Noun: An instance of accomplishing something by scheming or trickery
  
• Verb: Achieve something by means of trickery or devious methods; Tamper, with the purpose of deception
  
• eg: "Allies jostle to wangle plum portfolios"

19.05.2009

Politics & the Nation 

• It's political news all the way today
• With so much happening on the political front and the markets gyrating like there is no tomorrow the news channels are full of political news.
• Sample these: Manmohan elected Congress Parliamentary Party leader, Sonia remains Chairperson; Chamling submits resignation only to stake government formation in Sikkim, Rajasekhar Reddy to be sworn in tomorrow, Navin Patnaik set to be re-elected as CM, Orissa; Advani agrees to be leader of Opposition; Lalu's chances of retaining cabinet berth remote...
• India successfully test-fired its nuclear-capable 'Agni-II' missile with a strike range of upto 3,000 kms from a launch pad off Orissa's coast, today.
  
• The test was carried out from a mobile launcher of Integrated Test Range at Wheelers Island near Dhamra, about 80 kms from Orissa. 
  
• The state-owned Bharat Dynamics Ltd is the nodal agency for production of Agni-I and Agni-II missiles.
  
• The indigenously built surface-to-surface Agni-I missile has a strike range of 1500 km, while Agni-II missile has capability of hitting targets at ranges between 2500 to 3000 kms with a 1000 kg pay-load.

Finance & Economy

• Stock indices hit the roof; as expected.
  
• Investors scrambled to buy stocks as if there was no tomorrow, almost certain that the emergence of a stable government at the Centre would solve all the ills dogging the economy. In the mad rush, circuit breakers on the upside were triggered, and trading had to be halted from 12 noon onwards. This is the first time that trading has been suspended after the upper circuit breakers were breached. 
  
• What is a circuit breaker? 
  
• A circuit breaker helps check abnormal movement in indices, and also stock manipulation. The breaker is applied in three stages of movement — 10%, 15% and 20% — either up or down. 
  
• How’s the circuit limit fixed? 
  
• A circuit limit is fixed on the basis of the indices’ closing values at the end of the previous quarter. Monday’s limits were based on the closing values of the Sensex and the Nifty on March 31, 2009.
  
• The FCCB redemption story takes a turn for the better now
  
• With the markets now hitting circuit breakers the story on the FCCB front is going to pan out better for Indian companies.
  
• Riding on the strength of easy liquidity and the resultant equity boom a couple of years ago, Indian corporates were one of the largest issuers of such convertible bond offerings in the Asian region. FCCBs worth over $11 billion are outstanding for Indian companies with the redemption amount for 2009 estimated to be $186 million. 
  
• Over the last year, with the economic slowdown taking a toll on many companies, issuers have been finding it tough to find resources to redeem these bonds as investors shun conversion of these bonds into equity given the wide difference between the conversion price struck at the time of issuance and the current market price. The rally in the markets could now kindle hopes of such conversion especially with the Indian currency also strengthening. 
  
• Until just a couple of weeks ago, several issuers faced the prospect of managing the huge pile up of debt on their balance sheet in case investors were to exercise the option to redeem these bonds. It would also meant a substantial outgo on interest on interest payments.
  
• A very good recap of the circuit breakers in stock markets yesterday
  
• How does circuit breaker impact trading? 
  
• Trading is halted for an hour after an index moves 10% intra-day. In case of 15% movement, it is halted for two hours. If the index hits the 20% limit, trading is suspended for the rest of the day. 
• What happened on Monday? 
  
• Within a few seconds after markets opened at 9.55 am, the Sensex and the Nifty vaulted 1,789.9 points and 531.7 points, respectively, thereby breaching the circuit limits of 1,450 points (15%) and 450 points (15%) for the two indices. Consequently, trading in both equity and derivatives segments was halted for two hours till 11.55 a.m. Within seconds after resuming trading, the indices soared 2,110.8 points and 651.5 points, respectively, prompting the exchanges to apply the 20% circuit breaker, and suspend trading for the rest of the day.

Language lessons

• flub: verb
• Make a mess of, destroy or ruin
  
• eg: But the one part of America's foreign policy that Obama can be argued to have flubbed so far is its relations with India...
• excoriate: verb
• Express strong disapproval of; Tear or wear off the skin or make sore by abrading
  
• ... kills enterprise, excoriates the most bleedingheart of welfare schemes, stunts the minds and bodies of India’s young in its ill-run schools and hospitals and undermines the future.