02.03.2010

Politics & the Nation

• India's demographic dividend - some trends
• Here is an excellent article that discusses these trends. Well worth a read. At least once.
• Why is politics and business a heady concoction?
• Corporate meddling in politics is bad for capitalists — and thus for capitalism. Comment.
• If you are ever asked to answer such a question, this essay by Lucian Bebchuk is an excellent answer. Very good one. Take a look.

Finance & Economy

• On India's economic potential
• The single most important reason why India receives as much attention worldwide as it does today is its perceived economic potential. At $1.25 trillion in GDP, the country currently accounts for only 2.2% of the world GDP. It ranks a low 12th in economic size despite a population of 1.2 billion and comes behind all remaining three BRIC (Brazil, Russia, India and China) countries. Yet India cannot be ignored because if it fulfils its promise of near-double-digit growth over the next two decades, it would become the third or fourth largest economy in the world.
• HUL and P&G in ad war
• Read the full story here. Some excerpts:
• In a break from the hitherto genteel protocol that has governed advertisements of FMCG companies, HUL’s latest on-air offering extolling the virtues of homecare brand, Rin, has openly taken on rival P&G’s Tide without the typical airbrushing or pixelation to hide the rival brand name on TV.
• The Rin powder commercial, which went on air on Friday, clearly shows a variant of Tide, known as Tide Naturals, with the audio saying ‘Tide se Kahin Behatar safedi de Rin’ (Rin gives better whiteness than Tide). This punchy style of advertising is more akin to the wars between soft drink giants Coke and Pepsi, though they usually refrain from mentioning the name of the rival products. Instead, these ads are famous for taking pot-shots at each other’s punchlines.
• Earlier skirmishes between the two companies were restricted to disguised comparative advertising or matching each other’s price cuts with a similar move in the market. This time, however, HUL has clearly decided to engage P&G directly.
• Such head-on confrontations are rare for FMCG companies. Pepsi and Coca-Cola, fierce rivals in the aerated beverage category, are known for aggressive advertising. Other product makers have been getting into the act. Recently, Amul-Nutralite, competitors in the butter market; Airtel and BIG, both aggressive late entrants in the DTH market; competing airlines Jet Airways and Kingfisher, and Cadbury Dairy Milk-Nestle Munch (chocolate) have taken pot-shots at each other.
• However, their campaigns have been tongue-in-cheek without hitting the competitor directly. When Jet Airways came out saying, ‘We’ve changed’, Kingfisher took the chance to say, ‘We made them change’. Last year, Horlicks took on Complan directly, but it was limited to quantifiable comparison of ingredients and prices.
• Globally, around 25 years ago, IT giant Apple initiated an assault campaign hammering away at PCs using Microsoft. These ads, which became legendary, showed actor Justin Long as the smart Mac, getting the better of comedian John Hodgman as the confused PC guy. If Rin commercial proves a success, the small screen could very well see a string of so-called attack campaigns.
• According to market estimates, the Indian laundry detergent market is estimated to have grown 11% between 2008 and 2011. Washing powders constitute 70% of the market, with the rest being soaps & bars. HUL has increased its advertising spends by nearly 65%, compared to last year.
• The self-regulatory code of the Advertising Standards Council of India, of which both HUL and P&G are members, states that comparison between competing products is allowed, provided there is no likelihood of the consumer being misled about the brands being compared. With ‘whiteness’ being the quality compared in Rin’s advertisement, HUL seems to be treading a thin line.
• Some interesting statistic about excuse duties
• The revenue forgone on area-based excise exemptions alone is estimated at Rs 1,70,765 crore this fiscal year, significantly higher than the Centre’s excise duty collection of Rs 1,02,000 crore.
• Flat 20% risk weight mooted for core loans
• This is an interesting article by reading which we are sure to enhance our understanding of risk weight in banking parlance. Take a look.

• Flat 20% risk weight mooted for core loans
• This is an interesting article by reading which we are sure to enhance our understanding of risk weight in banking parlance. Take a look.

Environment

• What is wrong with India's stand on emission reductions?
• India has consistently maintained that per capita emission principle is the basis for an equitable burden sharing. Prime Minister Manmohan Singh made an international commitment that India’s per capita emission would never exceed that of the developed countries.
• At present, India’s per-capita emission is at 1.2 to 1.4 MT.
• The per capita emission approach does present some problems. It helps countries leverage on their large populations, as is the case with India and China, allowing for the rich in these countries to hide behind its poor. The per capita emission principle does not address the development concerns.
• What makes it imperative for India to look beyond this principle is the limited support it has garnered worldwide. As of now, only Germany and, to some extent, France have expressed support for it.

International

• India signs extradition treaty and a few other agreements with Saudi Arabia
• India and Saudi Arabia have vowed to jointly combat terrorism and money laundering as they signed an extradition treaty and several agreements to raise their cooperation to a strategic partnership covering security, economic, energy and defence areas. The extradition treaty enhances existing security cooperation and will help in apprehending wanted persons in each other’s country.
• Prime Minister Manmohan Singh and Saudi King Abdullah signed the Riyadh Declaration outlining the contours of a new era of strategic partnership between the two countries. Both sides emphasised the importance of strengthening the strategic energy partnership in line with the Delhi Declaration of 2006, including meeting India’s increasing requirement of crude oil supplies and identifying areas of new and renewable energy.
• India and Saudi Arabia also signed four other agreements relating to transfer of sentenced persons, cultural cooperation, memorandum of understanding between Indian Space Research Organisation and King Abdulaziz City for Science and Technology for cooperation in peaceful use of outer space and joint research and information technology.

Language Lessons

• drivel: Noun
• A worthless message; Saliva spilling from the mouth
• eg: After wading through the drivel of ethics-free Republican hacks and knowledge-free academic hacks who claim, one way or another, that the basic principles of economics make it impossible for government spending decisions to alter the flow of economic activity, reading Barro comes as a great relief.