Business and Economy

• The Finance Ministry has worked out modalities where banks will report a list names and permanent account numbers (PAN) of customers who earn less than Rs. 5000 interest. Many non-salaried people in India invest money in fixed deposits but do not report the interest earned as income for taxes. The Income Tax (IT) authorities made it a policy for banks to deduct taxes at source for accounts that earn more than Rs.5000 before distributing the money. However, as a workaround to taxation, many opened fixed deposits that earn less than this amount so they do not have to pay taxes. The latest move is to track those accounts and bring this into the tax net. A very small percentage of Indians pay direct taxes and instead use "black money" on the sly.

• The National Association of Software and Service Companies (Nasscom) said that while cost advantages were initial key drivers for the IT industry's growth it is innovation that is taking it forward. Last year Information Technology (IT) and IT Enabled Services (ITES) companies earned USD 20 billion, which is only a fraction of the global USD 300 billion addressable market. To be able to win more of that pie, Nasscom said that the "next killer application" must come from India. Noting that these industries are growing rapidly, it said that the Business Process Outsourcing (BPO) industry needed 2.3 million people by 2010 and it anticipates a scarcity in India to meet the need. However, there is a trend where most engineering students prefer to stay in India than go abroad; only 30% of Indian Institute of Technology (IIT) students emigrate as opposed to 70% only a few years ago.

Democracy, Politics and Judiciary

• As part of the ongoing investigation into the oil for food (OFFP) scam, the passports of 5 people affiliated with the Congress party have been impounded. One of the 5 was the son of the former Foreign Minister Natwar Singh, Congress Member of Legislative Assembly Jagat Singh. The oil for food scam arose from a report filed by former US Federal Bank Governor Paul Volker on the controversial oil for food program in Iraq. The program came into force after the United Nations imposed economic sanctions on Iraq after the first Iraq war but allowed it sell oil for food and medicines. Human Rights organizations estimate that the economic blockade killed half a million children. The program got subverted when the erstwhile Saddam Hussein regime handed out oil vouchers to recipients, usually people with influence in host countries, so they an influence favor for Hussein's benefit. The recipients could then sell the vouchers at international prices to those wishing to export oil out of Iraq. Singh Sr. was one of the three people identified in India as having benefited in the scam. Singh Jr. accompanied his father on the trip to Iraq when it is believed that the deal was struck. There is suspicion that the father did this at the behest of his son.

• A high-power Committee in Maharashtra recommended that the state make child labor a non-bailable (NB) crime. It found that in many instances where employers of child labor were arrested, the loopholes in the law saw them walking away with small bail bonds. The Committee said that the worst offenders were the gold and jewelry industry, zari units, garages, and leather and tannery workshops. Children are forces into labor due to poverty but are exploited by employers who force them to work for several hours with rest, education, and inhuman conditions. They suffer physical, psychological, and sexual abuse and the perpetrators often operate with impunity. Maharashtra will become the first state in India to have such legislation that will curb the enthusiasm to employ children.

Environment, Health and Education

• French President Jacques Chirac ordered the condemned aircraft carrier Le Clemenceau to return to France after the highest court ordered a recall. After issuing the order, he said his Government will "examine ways of reforming France's policy on exporting waste materials." Specifically, France will study "how to manage maritime wreckage with partner countries." France says that Europe does not have suitable wreck-yards to dispose such a large ship. This closes a real thorny issue ahead of Chirac's visit to India.

• The scare of the dreaded H5N1 bird flu virus spread in Europe with Germany reporting its first outbreak. European Union is banning the import of all untreated meat and feathers to curb a large scale spread of the virus. Recently spotted in Greece and Italy, the virus has already arrived in Austria, Bulgaria, Croatia, Romania, Slovenia, and Ukraine. Europe is bracing more instances with the impending summer migration of swans.

• Editorial: Regulate Ship Breaking Business

Terrorism, Defense and Security

• In a post-Iraq Quadrennial Review, the US is proposing to involve its present allies and "moderate Islamic regimes" in the war on terrorism. Calling this fight "The Long War," the documents says that this coalition will "share the risks and responsibilities of today's complex challenges." Measures proposed, funded by a USD 513 billion defense budget for 2007, include creation of more special forces, unmanned drones for targeted assassinations, a new long range bomber force, a new set of experts trained to control nuclear devices. According to US Defense Secretary Donald Rumsfield, these initiatives will "create an environment inhospitable to terrorism." British Foreign Secretary Jack Straw echoed Rumsfield in Nigeria saying that the next major challenge will be to deal with homegrown African terrorists. He said that these terrorists will be based in Africa and attack African and international investments world over. While Germany backs the idea of the North Atlantic Treaty Organization (NATO) to move beyond its borders, it is cautious on future military engagements. The NATO said that it does not want to be a global policeman but recognized that it had "increasingly global partnerships." There are several legal issues with respect to unmanned drone based assassinations such as legal infringement, geographical borders, sovereignty, and safety of population.