• The Railways Minister Lalu Prasad Yadav presented the Railway budget for 2006 with no phenomenal changes but without negative or glittery changes. The expectation was low and the lack of negative and glittery proposal like mud cups led to some cheer because Yadav's propensity to creating economic damage is high.  He announced the introduction of 55 new trains, no changes in passenger fares or freight charges, and a competitive discount of 10-18% on first and second-class A/C classes. He said that the Railways will allow private container trains before March 2006 but it is not clear whether these will be chartered freight trains from Railways or private operators on railway tracks. If it is the latter, it is not clear how the Yadav plans to deal with safety, protocol, and parking issues. Another plan is to make 200 trains super-fast. Again, it is not clear if this means just getting high capacity engines or laying new tracks; all railways tracks are over-subscribed and existing super-fast trains always run late because of traffic issues. Hence, it is not clear how making trains super-fast will really help without solving new tracks, animal control fencing, and cross-traffic management issues. Government's communist allies were incensed by Yadav's plans to outsource station maintenance, cleaning, and ticketing; these are issues that the Indian Railways has been incapable of handling. The communists have threatened to vote against the budget if these proposals are not dropped. The only significant and far-reaching proposal is the proposal to create a USD 4.5 billion dedicated freight corridor. The Railways itself is in good financial position netting USD 2.5 billion from USD 50 million in 2001, a freight volume of 668 million tons (from 600 million tons), and an operating ratio of 84.3% from 90.8% the previous year.

• Apart from the controversial 0% duty import of 500,000 tons of wheat, the Government is expected to import an additional 1.5-2 million tons (mt) this year. It is not clear why there is a shortfall in the quantity in stock. Production from Punjab and Uttar Pradesh is expected to be lower by 10-20% were lower because of drought and hot weather. This is surprising because almost the entire nation got what was close to a 100-year rain. The Government says that food consumption patterns have changed with a higher demand for high-value cereals products and more consumption of wheat in the South. However, it is silent on rain patterns, water storage levels, changing agricultural patterns where more land is being used for cash crops like sugar cane, changing weather patterns, and problems with storage. The Government has also not answered why the wheat stocks in the public distribution system (PDS) dropped from 7.3 mt in February 2005 to 5mt a year later. In April 2006, the stocks are expected to plummet to 1.7mt, 2mt below the Government target of 4mt; this will be the lowest wheat stock level in 20 years. The PDS stocks, managed by the Food Corporation of India, are required for the poorest families who cannot afford to buy wheat from the open market.

Democracy, Politics and Judiciary

• Mumbai session’s court accorded 9 accused in the "Best Bakery case" with life sentences and acquitted 8 others for lack of evidence. Four others with non-bailable warrants are still at large. After the Godhra incident where scores Hindu passengers were mercilessly burnt in an organized fashion by a Muslim village, riots in Ahmedabad by Hindu mobs targeted Muslims. Many activists accuse that this was a pogrom sponsored by Gujarat Chief Minister Narendra Modi. Mobs attacked Muslims, businesses, and civilians in an organized and brutal fashion. The case was moved out of Gujarat to Maharashtra as victims and activists say that they cannot get justice in Gujarat. The 17 dealt with the court, were accused of being in this mob. Specifically, they were accused of unlawful mob assembly, mischief by fire, causing grievous hurt, and using dangerous weapons. Of the 9, 5 had additional charges of damage to property, arson, dacoity, wrongful confinement, and criminal trespass. The "Best Bakery case" has been mired with controversy after the prosecution's star witness, Zahira Sheikh, turned hostile against her sponsor human rights activist and journalist Teesta Setalvad. Most certainly, this case will go on appeal as the judge pointed out that the police failed to provide incontrovertible evidence of special part played by any of them. This incident was also part of a written debate between then President Narayanan and Prime Minister Vajpayee. Narayanan may have breached Constitutional statues when he outed this secret dialogue and selectively quoting some of the contents. The Nanavati Commission examining the riots try to summon those documents but the Government refuses to divulge the letters seeking Constitutional privilege stating that the contents of the letter may seriously damage social structure.

• With the story of bird flu off the front pages of newspapers, eclipsed by budget information, large poultry manufacturers are planning to initiate a campaign that will revive their business. The broiler poultry business in India is estimated at USD 2.4 billion with a production of 30 million broilers per week. Initial estimates of losses were 20-25% countrywide and up to 85% in Maharashtra. With Government giving a feel good message on containment of bird flu, the sales in Maharashtra has already started picking up. The question that still remains to be answered is the root cause of the outbreak and what has been done by the Government to prevent a relapse. In Europe, Africa, and most parts of Asia, the spread is through migration whereas in South East Asia and China it is due to bad poultry conditions. Meanwhile, Cipla and Ranbaxy have offered to produce a generic version of Roche's tamiflu leading to a debate of whether this will mean a patent infringement. The Indian companies deny patent infringement claiming that Roche does not have a patent in India. The Indian Pharmaceutical Alliance disagrees with this assertion saying that under India's new patent law, Roche's global patenting will enjoy the same rights in India and licensing is necessary mechanism to avoid infringement.

• Editorial : Regulate Ship Breaking Business

• Saudi Arabian security forces seemed to have foiled an attempt by terrorists to disrupt oil supply by bombing the world's largest processing facility at Abqaiq in the Shia majority eastern province. A former CIA field officer described the facility as the "most spectacular target in the Saudi oil system" because it handles 2/3 of Saudi oil output and most of it is export through the Gulf. Oil prices jumped by USD 1.22 a barrel as any terrorist success will seriously affect oil supply in the world, as Saudi Arabia is the world's largest exporter of oil.