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Thursday, January 26, 2006



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Business and Economy

  • The Federal Cabinet approved foreign direct investment (FDI) of up to 51% in retail business. However, they did not open up investments for companies that ran multiple brands and did not promise if and when that may open up either.  Opening up retail is sensitive to the communists who support the Government. Communists think that investments in retail will wipe out traditional businesses that do not form their support base. However, are still philosophically against capitalism and they think that capitalists will profiteer on India’s poor. The Government opened up 100% FDI in infrastructure areas like airports, gas pipeline construction, power trading, exploration for diamonds, distillation, brewing potable alcohol, industrial explosives, and hazardous chemicals. It also abolished requirements to seek Government approval for projects away from urban areas. On the agriculture side, it will allow 100% FDI in and processing and warehousing of rubber and coffee but disallows any investment in coffee and rubber plantations. Several multi-national companies (MNCs) have already set up modern labs and have completed preliminary analysis of potential sites to mine for gold and diamonds. They are sought a “prospecting license” from the Karnataka Government.

  • Citing strong performance of the agriculture sector, the Reserve Bank of India (RBI) has increased the Gross Domestic Product (GDP) growth rate from 7%-7.5& to 7.5%-8%. This is the second time that the RBI has increased its growth estimate this year. However, the guard against inflation, the RBI increased the so-called repo rate by 25 basis points to 6.5% and reverse repo to 5.5%. The repo rate is the rate at which banks deposit their excess funds with the RBI and reverse repo is the rate at which RBI deposits its funds with banks for short periods of time. The repo rate is used as tool to control cash liquidity. This is the four reverse repo rate increase in the last 15 months and the highest it has been in 3 years.

Democracy, Politics and Judiciary

  • In a far-reaching verdict, the Supreme Court has indicted Bihar Governor Buta Singh for his “undue haste” to recommend the “drastic and extreme” dissolution of the Bihar assembly. It also chided the Federal Government for accepting the recommendation without verification. The SC observed that Singh’a report contained “fanciful assumptions” which could be destructive of the democracy. The SC also said that it couldn’t be a spectator to the “subversion of the Constitution.” After elections in Bihar last year, a hung Assembly let to the ouster of Lalu Prasad Yadav’s Rashtriya Janata Dal, after three terms in power, as a clear winner. Singh, a veteran Congressman, did not give the party that won the largest number of seats, the Janatha Dal (U), the chance to form the Government as required by the Constitution. In his report, Singh said that he suspected that assembly members might be bribed to support a new Government. The SC said that this suspicion is based on prejudice and that the Federal Government should have not accepted this report without due diligence. Although the court had ruled the unconstitutional nature of the dissolution, it could not stop the reelections in Bihar as the process for this exercise was well underway. The SC called the implementation of the Sarkaria Commission on federalism and for a policy that would ensure that non-politicians and eminent people would be posted to gubernatorial positions and not ex-party men. Federal Cabinet members were non-committal on the verdict even as the communists, allies of the Government, wanted Singh to be dismissed. The opposition party wanted Manmohan Singh to be sacked for misleading the President and United Progressive Alliance (UPA) Chairperson Sonia Gandhi to be held “accountable” for the coalition decision. Confident of his position, Singh struck a defiant note saying that he will “take the salute (the Republic Day salute on Jan 26) in Patna.”

  • The National Human Rights Commission (NHRC) has reported that despite strong laws and political will, weak police implementation and overburdened judiciary has resulted in a USD 8 billion flesh trade in South Asia. The study says that over 50% of the 450000 women and children trafficked every year in Asia-Pacific region is from South Asia. They noted that increased trafficking from Nepal, Bangladesh, and Sri Lanka has made this trade more valuable than narcotics. Trafficking in states bordering other countries, especially the North Eastern ones have reached alarming proportions. They warned that India is becoming a favorite child-sex destination and unlike Thailand or Sri Lanka, the issue is not being discussed or policed well. Beach boys, shack owners, and former victims of pedophiles source child victims in Goa, Kerala, and Tamil Nadu. An interesting outcome of the study is that married men living with their families are more likely to abuse trafficked girls than those who are not with families.

 

Hot Topics

FDI in India

Recent Supreme Court verdicts

Human Rights Violation

IIsc Terrorist Attack

Peace process in Srilanka

Election in Nepal

Featured Analyses

The Saga of the Jemaah Islamiah

Indonesia has continuously been embarrassed by the terror acts of a handful of terrorists from the Jemaah Islamiah (JI), a group with definite Indonesian origins and made up mostly by members of Indonesian nationality.

Will Kashmir go the way of Aceh?
A Cry for Help
Watch the Dragon
Cage This "Tiger"
Dalits in India
Was Jinnah a Secularist?
Burying the Howitzer?
Smoking Out Smoking
The French Non

Featured Edits

Pakistan and the gas pipeline
Umbilical connectivity and societal change
Blasts in India, Afghanistan
Central culpability
Cautious opening up
Is a breakthrough possible?
Beyond the composite dialogue
Reversing the tide in Darfur
Inscription
South Indian Inscriptions

Ancient Indian dynasties documented their administration, significant developments, grants, and milestones as inscriptions in temples. The Archaeological Survey of India (ASI) has documented these inscriptions from 1886. These pages contain inscriptions from Pallava, Chola, Pandya, Western Chalukya, Eastern Chalukya, Rashtrakuta, Hoyasala, Vijayanagara, Vishnukundin, Kakatiya, Reddi, Vaidumba, Chinda, Eastern Ganga, Gajapathi, Kalchurya, Qutb-Shahi of Golkonda, and Moghul,  dynasties.

Terrorism, Defense and Security

  • Pakistan President Pervez Musharraf has confirmed the presence of “foreigners” in Damadola, the village bombed by CIA Predator drones. It also appears that the CIA has developed or cultivated intelligence assets (spies) with the Pakistani Inter-Services Intelligence (ISI) organization. It also appears that many former ISI operatives are in the CIA pay and report directly to Washington. Reportedly, these assets tipped off the CIA, which prompted the Hellfire missile attack. The Pakistani Federal Cabinet is speaking in conflict tones with the Prime Minister saying that no terrorists were killed while his President and other Cabinet members maintaining that there were terrorists. However, even after 10 days, no bodies have been recovered from the site. It is not known if al Qaeda operatives or CIA operatives removed the 13 (not 18 as reported earlier) bodies.

  • European Human Rights investigator and Swiss Senator Dick Marty said that the United States systematically used torture through third parties as a weapon against captured Taliban fighters and suspected terrorists. Although he did not have clinching evidence on the presence of secret torture cells in Europe, there is strong suspicion that the US may have used Romania, Poland, Ukraine, Kosovo, Macedonia, and Bulgaria as places to host these centers. Marty said that the European Union knew about this strategy but decided to turn a blind eye to this “dirty work.” In a report to the 46-nation council in Strasbourg, he said that over 100 people have been “abducted, deprived of their liberty and transported to different destinations in Europe, to be handed over to countries in which they have suffered degrading treatment and torture.” The Washington Post had initially broken the story about the existence of secret torture prisons in Europe and the US has neither confirmed nor denied their existence. Supporters of the US and its allies in the Iraq War said that Marty’s report was full of inconsistencies and “has more holes than a Swiss cheese.” 

  • The Bangalore police two more suspected Lashkar-e-Toiba (LeT) operatives in the city and retrieved several bombs and “incriminating documents.” The activists were carrying, tin bombs, carrier bombs, detonators, and a country-made revolver. The arrested individuals were in constant touch with other suspected operatives in custody and attended several meetings organized by the LeT. So far, six suspected operatives are in police custody.

Neighbors

  • Norwegian Minister for International Development Erik Solheim met with Sri Lankan President Mahinda Rajapakse to bring the Government and the rebel Liberation Tigers of Tamil Eelam back to the peace process. The Government has already said that they will not restart the civil war nor will they react to the escalation of violence by the LTTE. As Solheim was heading to meet the elusive LTTE chief Vellupillai Prabakaran, about 2000 strong protestors led a march up to the point of control dividing the rebel-held and Government held areas to protest the alleged killing of Tamils. They crowd burnt an effigy of Rajapakse but Government troops refused to be drawn in. The LTTE said that they did not instigate this protest but this is an issue of serious concern to the Tamils and would feature in their talks with Solheim. 

  • Despite heavy opposition and protests, Nepal’s King Gnanendra seems intent on his local elections scheduled for February 8. A 7-party alliance has called the elections a “sham” and decided to boycott the elections. The Government has removed curfew in most of the country but clamped new prohibitory orders in some parts. Post-paid cell phones became operational but Indian and Kazakh joint venture service providers were not allowed to operate. A bundh (shutdown of businesses) is scheduled for January 26 to protest against “repressive” measures of the Government including curfews, prohibitory orders on rallies, and disconnection of phone services. The Government had requested the opposition to desist from rallies in sensitive areas so Maoist terrorists do not use this opportunity to infiltrate and implement terrorist attacks; the opposition largely ignored this request leading to large-scale detentions and arrests. The monarchy dismissed a democratically elected Government to assume overwhelming power to fight the Maoist uprising in the country.

World

  • After four successive liberal Governments, Canada has elected the conservatives to power. Strained US-Canada relations, party scandals, and two years of inconclusive investigations spurred a desire for change. Conservative leader Stephen Harper convinced voters that he closer to the Center and emphasized tax-cutting and cleaner Government than abortion and gay rights. In a fractured vote, the conservatives won 36% of the votes but still short of a majority. They showed strong support across the board but more so in rural and sub-urban areas. Harper is a major supporter of the US in the Iraq war and opposes the Kyoto Protocol on climate control, which Canada has already signed and ratified.  Several Indian-Canadians were elected to the Parliament.

  • After a space of 51 years, Saudi Arabian King Abdullah bin Abdul-Aziz al Saud is visiting India for a 4-day visit. Defying protocols, the Prime Minister received him at the airport. India and Saudi Arabia will be signing three Agreements on combating terrorism, preventing double-taxation, and promoting investments. Saudi Arabia with the largest oil reserves supplies about 25% of India’s 1.9 million barrels a day usage. Accompanied by a large entourage, the Abdullah will be the Chief Guest at the Republic Day parade. Coincidentally, Abdullah visited China and signed similar Agreements with that country before his trip to India. A large expatriate Indian community lives in and Haj pilgrims visit Saudi Arabia.

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