The Finance Minister P. Chidambaram clarified many aspects of banking regulations in the Parliament. Although interest rate regimes of banks have been deregulated, he said banks are instructed not to increase interest rates of loans below Rs. 200,000 beyond the benchmark prime-lending rate (BPLR). The highest grouping of all public sector banks, the Indian Banks' Association (IBA), has been asked not charge more than 9% on crop loans up to Rs. 50,000. All domestic commercial banks are required to lend up to 40% of their net bank credit to priority sectors, including agriculture. Banks have also been directed to ensure that the money collected from non-performing assets (bad loans) be more than the money that is written off.

Experts are questioning the Constitutional validity of the controversial Fringe Benefit Tax (FBT), which may force the Government to either withdraw it or amend the Income Tax Act of 1961. The FBT was introduced in April 2005 as a mechanism to tax deemed "benefits" that a company offers its employees. Shockingly, normal business expenses such as business travel, entertainment of customers, etc. were suddenly deemed "benefits" given to the employee. The other items included were company paid car, housing which companies and employees to evade income tax illegitimately manipulated. Instead of introducing taxation policy that encourages economic building activity such as home ownership, savings, and investment, the tax structure encouraged home rental and automobile ownership. The tax structure encouraged corporate malpractice often trying to hide income and showing illegitimate expenses as legitimate. The FBT exacerbated the problem by taxing all expenses dealing with employees without determining true employee income and illegitimate expense. The Constitutional question on FBT is that current tax laws allow the taxation of a net income of a company and not on expenses for which no value has been assigned and without determination of whether the expense can be translated into income.

There was widespread ire among the intelligentsia over the acquittal of the alleged killers of Jessica Lal, a smalltime model, in a public space. Fear of reprisal from politically supported individuals saw many eyewitnesses backing off from their previous statements. Several called for an autonomous agency that deals with prosecution and investigation. The public anger and disfranchisement is best described by the Chief Justice of India Y.K. Sabharwal on February 16 when delivering a verdict for a different case. Emphasizing the rule of law, he said "this court cannot remain a mute spectator when the violations also affect the environment and healthy living of law-abiders." But then laws bind the courts, the efficiency of prosecution, and capacity of the state to provide safe cover for eyewitnesses.

After consistently denying human infections, the Health Ministry said that there is "distinct possibility" of humans being infected by the virus and that those suspected of infection have been quarantined. Animal Husbandry Secretary P.M.A. Hakeem faulted the Maharashtra Government for late delivery of notification to the Federal Government. He said his officials found a citation of the outbreak in a vernacular paper and rushed to the site even before the state notified the Federal Government. Despite the threat of the pandemic for over 2 years, the Indian Council of Medical Research (ICMR) does not have the latest equipment to credibly test samples and took them 7 days to confirm that it was avian flu—an overall delay of 13 days. The Government is now importing two advanced test systems from France and is expected to be in place in a couple of days. These machines will be able to detect the virus in 90 minutes. The Government still does not have any answers to the root cause for the outbreak and agencies are generally blaming each other on clearances, access, and restrictions. Meanwhile, a whinny poultry industry official said that in just 3 days after the outbreak of the pandemic, the poultry sector reported that the industry has so far lost USD 55 million. They denied the presence of bird flu virus in India and even insinuated a conspiracy by multi-national companies to bankrupt the domestic companies. Broiler chicken prices fell sharply as airlines, railways, and consumers stopped serving and eating chicken. With bans on Indian poultry and products from SAARC and other nations, the export of eggs has come to a complete stop. Vice Chancellor of Karnataka Veterinary, Animal and Fisheries University Srinivas Gowda said that India was better placed than China and Vietnam. Unlike in those countries, poultry business in India is isolated and there is no collateral damage to porcine livestock as the disease spreads easily.

Editorial : Regulate Ship Breaking Business

The Hindu Law Board (HLB) has declared a bounty of USD 200 million for the murder of famous ageing artist M.F. Hussain. In an apparent counter proposal to highlight the controversial murder offer by senior Uttar Pradesh Minister Yaqoob Qureshi the unheard of body accused the artist of irreverent depiction of Goddess Saraswathi and Bharatha Mata (Mother India). Hussain had painted these Goddesses in nude and apparently offended some sensibilities. The offer seems a lampoon of Qureshi but the so-called President of HLB has opened himself to the same criminal laws that Qureshi was seen violating. Meanwhile, two complaints were filed against Qureshi for his bounty offer accusing him of Constitutional breach and violating various criminal laws.

The peace talks between the Sri Lankan Government (SLG) and the Liberation Tigers of Tamil Eelam (LTTE) got off to a rocky start as the LTTE objected to the truce accord is changed. The SLG proposal to modify the truce accord was shot down quickly by chief negotiator Anton Balasingham saying that it was a "well crafted, valid document of peace devised for the purpose of bringing an end to hostilities and to create a positive environment conducive for meaningful negotiations."   SLG had hoped to bring in "legally binding" clauses to a more "meaningful ceasefire." It said that "the ceasefire agreement entered into between the then Prime Minister Ranil Wickremesinghe and V. Prabakaran, the leader of the LTTE, is contrary to our constitution and law." The LTTE took umbrage to SLG statistics accusing the LTTE of violating the ceasefire 5,464 times and said that such exaggeration will not help negotiations. The LTTE has declined to even comment on these accusations saying that it serves "no meaningful purpose."