18.05.2010

Politics & the Nation

• Dantewada-II: Reds blow up 47 in bus blast
• In a shocking reminder to the governments, both at the Centre and in Chhattisgarh, about the uphill task they face in their efforts to restore order in the Naxalite-infested areas in the state, at least 47 people, including 32 civilians and 15 special police officers (SPOs) and local policemen, were killed and several others injured when the private bus in which they were travelling blew up under the impact of a landmine midway between Dantewada and Sukma late Monday afternoon.
• They had, on April 6, killed 76 CRPF personnel in the Mukrana forests of Dantewada district, inviting popular outrage and all-round condemnation.
• Some of the major Naxal attacks in the last two years:
• April 6, 2010: 76 security personnel, of whom 75 belonged to the Central Reserve Police Force (CRPF), slaughtered by Maoists in the Chintalnar forested hamlet of Dantewada district.
• April 4, 2010: Maoists detonate powerful landmine and blow up police bus in Koraput district, Orissa, killing around 10 Special Operations Group personnel and injuring 16.
• March 23, 2010: Maoists blast a railway track in Bihar’s Gaya district, causing derailment of the Bhubaneswar-New Delhi Rajdhani Express. On the same day, a landmine attack in Orissa leaves an empty freight train derailed and hitting railway services on the Howrah-Mumbai route.
• February 15, 2010: Around 100 Maoists storm a police camp in Silda, West Bengal, killing 24 policemen and looting arms.
• October 8, 2009: 17 policemen were killed in an ambush by Maoists at Laheri police station in Gadchiroli district of Maharashtra.
• July 27, 2009: Six CRPF men killed in a landmine blast by the ultras at Dantewada district in Chhattisgarh.
• July 12, 2009: Three separate attacks in Rajnandgaon district of Chhattisgarh claim the lives of 30 security personnel.
• June 23, 2009: A group of motorcycle-borne armed Maoists open fire on Lakhisarai district court premises in Bihar to free four of their men.
• June 10, 2009: Nine security personnel, including CRPF troopers, ambushed by Maoists during a routine patrol in Saranda jungles in Jharkhand.
• May 22, 2009: Maoists kill 16 policemen in the jungles of Gadchiroli, Maharashtra.
• April 13, 2009: Around 10 policemen are killed in eastern Orissa’s Koraput district when Maoists attack a state-run bauxite mine.
• A decent editorial comment in this regard:
• The home minister, the prime minister, Congress president Sonia Gandhi and Congress leaders all are on record, on the need to have a two-pronged strategy to combat Maoist extremism: policing and development. Development is not just a question of better delivery of government schemes; rather, it begins with political mobilisation of the people to make them the subjects, rather than the objects of development. Once they have agency, a whole lot of problems related to leakages, targeting, etc, would disappear. Once people are politically mobilised, and have a stake in development, eliminating the Maoist security threat would become relatively easy.

Personality

• Ajit Tyagi
• He is the director general of the India Meteorological Department (IMD).

Finance & Economy

• There is no case for tolerating the bankrupt politics that generates shortages and stampedes. Comment.
• Made in the context of the stampede in New Delhi railway station that killed two people and left many injured, this is a truism in our country.
• The stampede is the result of economics of shortage being at work. The supply of train seats is grossly inadequate to meet the demand. In a functional market, the price of whatever is in shortage would rise, leading to a fall in demand and a rise in the supply. However, in the case of trains, as with piped water supply and urban public transport, the market does not function. To say public policy intervenes to prevent the market working in these cases is to give bankrupt politics a good name. When the price of a good is kept repressed, it creates queues for the good in short supply, but also makes it affordable for a section of the population that would have been excluded by a price that cleared the market. This concern for the poor has been touted by our politicians as the reason for building a shortage economy for a variety of public services. This is the core problem.
• What is the core issue in climate change negotiations?
• Equitable sharing of carbon space. To put it in one sentence.
• Take a look at this op-ed which explains the concept in detail. Very interesting read.
• India's defence sector stats
• India is among the top 10 countries in the world in terms of military expenditure
• Defence spending budgeted at Rs 1,47,344 crore for 2010-11
• The country imports 70% of its defence requirements
• India's defence exports are 1.5-2.4% of the total production
• FDI in defence was a measly $0.15 m over Apr ’00 to Feb ’10
• On India's infrastructure sector performance
• Take a look at this graphic which gives some details.
• RBI's proposed move on regulating holding companies raises alarm for big conglomerates
• The central bank recently initiated a process to regulate large holding companies, typically those with assets of more than Rs 100 crore, mainly to restrict the recent rush toward raising easy money. It has also suggested limits on such holding companies to borrow. The central bank’s concern stems from the disproportionately high fund-raising by many of these companies with shallow capital base.
• Most of India’s top corporate names, including the Tatas, the Aditya Birla Group, the Bajaj Group, the UB Group, GMR, have holding company structures that are essentially unlisted family-owned parent companies with equity stakes in all group companies. Holding company structures have been popular, as they allow fundraising at various levels, without the promoter losing control. It is also possible to own control of another company with less investment than is required in a merger or a consolidation. This is because a holding company only needs a controlling interest in the acquired company and not complete holding.
• The business houses are against the draft measures, as they would mean imposition of limits on the amount of investment a holding company can do in a group company and also because the measures restrict holding companies from borrowing outside the group. RBI has suggested that holding companies can’t borrow more than 2.5 times their adjusted net worth from outside the group.
• The draft guidelines also say that the holding companies need to have a minimum capital ratio whereby the adjusted net worth is not less than 30% of the aggregate risk weighted assets. Holding companies have been used to hold shares of subsidiary companies, as assets on the books of the parent company. These are then used as collateral for debt financing.

International

• UK’s Conservative view on offshoring worries IT
• The newly formed coalition government in the UK is reviewing at least six outsourcing contracts, including the $850-million pension administration deal signed by the Labour government with Tata Consultancy Services (TCS) earlier this year.
• The move, which comes in the backdrop of UK’s mounting public debt and budget deficit, is likely to call into question the business plans of IT companies that were banking on the UK and continental Europe to spur their outsourcing business following the dramatic slowdown in the US during 2008-09. They are likely to face tough times as politicians in Europe grapple with rising unemployment and increasing anger over outsourcing and immigration.
• The UK government’s IT spending is estimated to be over $36 billion every year. But the Conservatives plan to scale down large government IT projects.
• US sees record capital inflows in March
• Foreigners bought a record $140.5 billion of long-term US securities in March and more than doubled their purchases of US government bonds.
• China remained the largest holder of Treasury debt and added to its holdings for the first time in seven months. Net Treasury purchases by all foreign investors jumped by $108.47 billion in March from $48.1 billion in February. Net foreign purchases of US corporate debt also jumped to $16 billion from a net outflow of $12 billion in February, and net purchases of US agency debt rose sharply to $21.9 billion from $2.4 billion.
• China bought $17.7 billion worth of U.S. government debt in March, swelling total holdings to $895.2 billion. It was the first time China added to its Treasury stash since September. Japan remained in second place with $784.9 billion, up from $768.5 billion in February.

Language Lessons

• chuffed: Adjective
• Very pleased
  
• eg: Indians are still — above a certain age — obsessively Anglophilic, and finally, we’re highly chuffed to see the poor Brits struggling with something that we’ve learnt to live with long ago.
• schadenfreude: Noun
  
• Delight in another person's misfortune
• suss out: Verb
• Examine so as to determine accuracy, quality, or condition
  
• eg: Prolonged exchanges between the vendor and the buyer, sussing out other places offering more variety, squabbling over design and appearance are all part of the ceremony...
• cross the Rubicon
• To make an irreversible decision or to take an action with consequences