Indian Current Affairs: 21.11.2009

Politics & the Nation

This is because there is a market-distorting dependence on each other. For growers, mills in the immediate vicinity become monopoly buyers and, for mills, their basic raw material would become scarce if cane growers cut back on production. In other words, the assets of the sugar mill and the cane grower derive their value in the relationship between the two types of producers.
It is precisely such producers, says Oliver Williamson this year's Nobel laureate for economics, that should be vertically integrated into a firm, rather than enter into a market contract.
In this context, today's heading for one of ET's articles on the subject is very apt and interesting:

What is still holding up the operationalisation of the 123 Agreement between India and the US?

At this stage, there are still three steps that need to be concluded.
One is an assurance from India on non-proliferation in the form of a letter. The second is the conclusion of the reprocessing agreement between the two countries.The third step is a civil liability law.
Before Mr Singh’s departure for the US (he is on a State visit to the US from November 24), the Cabinet on Thursday had cleared the Civil Nuclear Liability Bill, which will allow India to join the international convention on civilian liability in case of nuclear damage.

According to Mr Vijay Kelkar, Chairman of the 13th Finance Commission, the value of PSUs, both listed and unlisted, at current fair market price is anywhere between Rs 13,800,000 crore and Rs 18,400,000 crore.
If you disinvest 50% then you have $200-billion fund.
He stressed that the government needed to focus on areas that it alone can take care of.
He is reported to have said "We don’t now require public sector hotels, airlines, even many other areas ... earlier we didn’t have capital market, we didn’t have entrepreneurship...”
Mr Kelkar’s comments come on the back of the findings of the TERI report, which suggest that unclean air and water could be responsible for the death of eight lakh people every year in the country. The report states that the quality of environmental services has a direct bearing on the health of people.

Finance & Economy

Mobile users unhappy with the services of their operators just need to pay a nominal fee of Rs 19 for moving to a new service provider.
Subscribers in Delhi, Mumbai, Kolkata and category ‘A’ circles such as Maharashtra, Karnataka, Tamil Nadu, Gujarat and Andhra Pradesh will be allowed number portability from December 31 while the rest of the country will have the facility from March next year.
Number portability is expected to intensify an ongoing price war that has already hit the sector’s profits and revenues.
New mobile users would be permitted to change their operators only after 90 days of signing up with a service provider. The users who wish to change their operator will have to give a written undertaking to their existing service provider for switching to a new operator. Trai has fixed a four-day window for operators to process an application.

Policymakers have reportedly decided to terminate the easy overseas borrowing policy for companies unveiled due to credit crisis last year, as they prepare to battle rising assets and commodity prices and to prevent currency appreciation, which erodes exporters’ profitability.
India is among many countries, including the US, EU and Australia, that are reversing emergency liquidity measures unleashed after the collapse of Lehman Brothers.
RBI in January did away with rules that mandated that companies borrowing overseas with an average maturity of 3-5 years had to do so within 300 basis points over the six-month London inter-bank offered rate, or LIBOR, the benchmark for borrowing and lending in global markets. ECBs of more than five years had to be within 500 basis points of this benchmark. These will be applicable again from January.
Inflows impose cost on the government as it has to sterilise them. Dollar flow increases supply of rupee funds, which are then mopped up through bonds to keep high liquidity from causing inflation.

International

The kind of relationship that exists between China and India on the one hand and China and the US on the other comes to be described as Cold Peace.
The Cold War and a bipolar global system ended in 1989 with the fall of the Berlin Wall and the liquidation of the erstwhile Soviet Union in 1991. The former Cold War system of international relations, however, has been replaced by a system of Cold Peace between competing powerful countries such as India and China or the US and China. The salient feature of the era of Cold Peace between powerful countries like India and China is that both have conflicting and competing areas of interest and, at the same time, both have clearly opted for a path of friendly or formal methods of resolving their bilateral disputes.
In this context this one sentence sums up India's policy towards China:
Cooperate and compete and make every effort to resolve conflicts between two big neighbouring countries is the essence of India’s approach towards China.
On the Brahmaputra dam issue:

All of you know that India is agitated about China constructing a dam across the Brahmaputra.
The UN International Convention of 1997 on Non-Navigational Uses of International Water Courses mentions that the lower-reparian country should be consulted and its cooperation should be sought. India abstained in the vote in the UN and China had opposed this Convention of 1997. Because of this, India and China will have to enter into a political dialogue and negotiations on the issue of construction of a dam on Brahmaputra from the Tibetan side.

Thus it is clear that India and China are in a state of Cold Peace where conflicts exist but the mechanism of dialogue is accepted by both the countries for resolving the bilateral disputes.

Science

After a year of repairs, the Large Hadron Collider at CERN was started again on Friday. Read this report that gives details about it.

Language lessons: Some interesting phobias

Indian Current Affairs