Monday, December 26, 2011

FDI in Retail: Will it help the economy?

If one has read my last article, it would be clear that the UPA Govt has not passed a single legislation this year that can help the economy nor has it shown any interest. All of a sudden when rupee began to reach 53 against dollar the fear began in the government. Depletion of dollars and no major reform eroded the growth projection to less than 7% and decreased the confidence of India in the eyes of the world. It was a desperate attempt to inject dollars and hence in between the Winter Session the Govt decided to clear FDI in single brand to 100%. It had to finally backtrack after the entire opposition including its own allies protested against this.

FDI in retail is a huge legislation as its impact can be felt across farmers and traders which are the biggest vote banks for Congress and BJP respectively. But does FDI in retail help the economy? Does it help the farmer? Does it help to control inflation?

The answers for this can be understood if the existing scenario with facts are presented. Let's look at it.
  • 60% of what farmers produce gets consumed in villages (over 6 lakh villages).
  • 40% makes it to the market for everyone else to consume.
  • The current Agriculture Produce Marketing Act (APMC) prohibits farmers to sell to anybody who doesn't have APMC license. There are exceptions to this in several states notably Punjab and Gujarat.
  • 40% of this 40% that reaches the market gets wasted as there is no storage facility at the APMC yard nor does the govt has ever bothered to set up cold storage facilities in proportion to what is produced. It has set up in some places, but not adequate for all fruits and vegetables.
  • 40 million people get employment because of the existing unorganized retail or mom-pop stores. 200 million people lives depend on this 40 million. (Source)
The amount of wastage in 2011:

So, how does this 40% reach the consumer?

There are anywhere 6-7 layers between a farmer and a consumer(follow the chart below). The farmers go to village Haats, Shandies etc that are setup on a regular basis (daily, weekly or bi-weekly) and are either held at the village or 6-20 km from the village. So, the farmer travels. The farmer also goes to APMC yards where there are government agents and middlemen (commission agents) who purchase from the farmers and pass on to wholesale dealers, retailers and thereby consumers. Each layer adds a price and hence the consumer ends up paying a huge price and the farmer gets only a portion of it as profit. The rest is eaten up by the middlemen.

Hence, farmer sells say potato at Rs.2 per kg while consumer buys at Rs.12 per kg which means Rs.10 is eaten up by middle men. Neither there is regulation nor control on the prices or the profits the middlemen make. This is one of the major reasons of high inflation in India. I had explained this in my earlier article - Why onion prices have skyrocketed? .

Further, farmers don't get the correct price and the weights are not accurate as well.

EXCESS WASTAGE, INFLATION CAUSED DUE TO MULTIPLE LAYERS and NO PROFIT FOR FARMERS - clearly 3 major problems in the existing model.

The current organized retail stores in India (prominent ones):

Big Bazaar, Spencers, etc constitute only 5% of organized retail while the unorganized retail is still 95%. Each of these stores may look like they are making profits, but their losses run into thousands of crores. (Source:

Will the entry of foreign players help the current scene? If yes, how?

Again, looking at the chart which showed 6-7 layers in the existing model between a farmer and a consumer, the entry of foreign players will reduce it to 3-4 layers, a cut down of 3 layers in most cases.

The foreign players like Walmart, Carefour, Tesco have huge presence across the world. They have the expertise to manage such huge distribution issues and have applied technology to the fullest extent. When such players come in they will directly deal with farmers and get the produce from them. They would ensure that farmers are given better price, weights are checked properly and storage facilities set up for excess quantity to prevent wastage. Basically transparency sets in.

To maintain any cold storage facility is not a rocket science. However, for 60 years no Govt or any law has accelerated this process. Yes, these storage facilities require electricity, water but that's precisely what Govt has spelled out that 50% of investment that such companies would make must be in this sort of back end infrastructure. In other words what Government could not do these companies are expected to do!!

As an example, look at how Walmart has opened stores in Punjab and how it is helping them get better prices and ensure transparency in the system. This is not to say Walmart is sincere in what it does and our middle men and small stores are not. It's just there are many practices which such stores have which others do not. Such an expertise is needed to propel competition in this sector ultimately benefiting the customer. In Punjab today Walmart has tied up with farmers on contract farming basis and such stores not only regularly take the harvest/produce from farmers, but ensure a clean mechanism of making payments. They don't have to travel much as Walmart has set up a network of centers to do this collection.  The farmers are also trained on how to increase the yield and productivity that helps them and Walmart. Here's more to read on this.

These are the pictures of Walmart store in India. As of today 100% FDI in single brand is not allowed and hence Walmart has tied up with Bharti and called it - "Best Price Modern Wholesale".

A single store hires 35,000 and has changed the way the whole supply chain system works there. Think of this - If one store can employ 35,000 and if Walmart can open 10 such stores they would employ a mammoth 3,50,000 people and train them with better customer friendly practices and update them with technology. How many small stores can create such a huge employment at the same time? In today's world the next generation doesn't want to join their parents' business of mom and pop stores. Think of what opportunities such stores can have if they could tie up with such multi giants to supply their products as is happening in Punjab?


Can FDI in retail help control inflation? Will prices come down?

This is definitely a grey area. It has mixed shades. Take a look at this video here. According to this, the 5% organized retail which exists in India haven't helped much in bringing prices down. In many cases prices at such stores are more than the ordinary retail store (Source). So, will inflation be able to come down? 

The fact we have to consider here is that 5% doesn't bring competition but 20-30% will surely do. Presence of multiple stores will propel competition. If Hyundai and Maruti alone were the cars in India there would not have been lower prices. If Airtel and Spice were the only cellular service providers prices of calls would not have come down. Presence of different companies spurs competition. One could not think of buying any other car for the range Rs 4-5 lakh a few years ago other than Maruti. Now, there are several cars to choose from for that range. Similarly, a handful of stores being a part of organized retail doesn't help.

On the other hand a logical thought that comes to one's mind is how could these stores sell at a lower price when their operating costs are so high - rent, electricity, water, labor charges etc. Many stores actually got closed like Subiksha as they did not have the expertise of the back end. Big Bazaar, Spencers are all incurring operating losses. So, will multiple stores help? We cannot definitely say. That is why this area is a shady area with no clear visible impact in India. Hence this must be done on an experimental basis.

The government has this condition that such stores must be set up in cities with population more than 1 million and currently there are 51 cities in India that satisfy this condition. This has to be experimented. Only then can it be determined if inflation can truly be controlled. Contrary to the claims of both who oppose this legislation and those who want it to be enacted have no proof of all that they claim regarding inflation is indeed true.

Can foreign companies dump goods from different parts of the world? If so, what about - Made In India - products?

As it is many customers today get to see products from different countries. So, this is not new. However, Walmart for example gets 80-90% of its goods from China. China is the biggest beneficiary. If these stores are allowed to operate in India they will surely dump them into our markets. No doubt the consumer benefits, but goods and products made in India will not reach the consumer. Hence, the government has put the condition that 30% of products such stores would sell in India must be from Indian suppliers. This is good, but must be increased to 40%. By doing so, such stores can also get an opportunity to sell goods made here to other countries and make additional profits. Who knows tomorrow Indian mangoes may be available in America in Walmart and become dominant there? 

This is a very important clause and must be carefully implemented. There might be a need for a regulator to monitor if the stores are indeed sourcing 30% from Indian counterparts. If the stores do not take this seriously it will cause losses to a lot of small stores who would have dreams of tying up with them. This is definitely a genuine concern for retailers.

Will the small stores eventually shut? No, this is an exaggerated fear

How many stores have closed because of Big Bazaar and Pantaloon? Hardly any. In fact the unorganized retail continues to show 15% growth while organized retail has come down from 25% to 15% in the last few years. Why is this so? This is because a consumer would prefer to go to stores at a walking distance even if the cost is Rs.1 more than a store for which he has to travel a small distance. Most housewives cannot depend on their husbands or use transportation to get small items. They would prefer to go to near by stores. It is this particular attribute of Indian retail mindset that still keeps the small stores going. There are other personalized services these stores may offer. In many places they offer door-to-door delivery, deferred payments, cash payments accepted and many more which the big stores may not offer. Simply because it doesn't work out to them. Since Big Bazaar cannot come up in every street it cannot displace the small retailers. It may hit their profits but cannot shut them down. If it had to then it would have been visible by now.

The real estate prices are too high for such giant stores to be set up everywhere. Hence, they must be allowed to change the whole supply chain and bring in clean and efficient mechanisms.

This chart explains how FDI in different countries has helped them and why the govt's idea of India specific model is actually good.

Images courtesy: Source

In conclusion I feel FDI must be allowed in cities to start with and depending on how it would control inflation and farmers should be applied across the country. For whatever reasons BJP is opposing looks wholly opportunistic. Congress at one point too opposed this. It is not too late when this would become a reality. For sure FDI in retail will come about.

Sunday, November 27, 2011

The Govt stagnates the growing Indian economy

The year 2011 has been the worst year for India as far as policy initiatives, policy implementations and legislations are concerned. Not a single piece of reform has been taken up by the Govt. From the beginning till the end other than the discussion on the Lokpal, Govt did not do anything substantial on reforms. It has been just sleeping. 

If recession plagues the West, inflation plagues India. Inflation is a sign of economic growth, but excessive inflation is a sign of huge mismanagement of the economy.

The Indian economy has clearly slowed down. The growth levels have been reduced from 9% to less than 7%. High inflation, high interest rates (auto, personal, credit, home and virtually everything), low growth and lower industrial growth has now taken the sheen of the India growth story. 

The rupee has gone to new record levels of close to Rs.53 against the dollar. This is a new record. This appreciation means imports will get costlier. The oil prices will rise and adding to the RBI's interest rate hike the inflation will go northwards without a stop. The government doesn't want to take any step. The Govt has not even passed many of the bills which can usher in new economic spurt such as Companies Bill, Direct Tax Reforms, Land Acquisition Act, FDI in aviation, The Seeds Act and many more.

For one year other than just talking nothing has the PM nor the Congress party done anything new in the economy. The thought probably is India is rising and there is no need to act. This is a colossal mistake.

Let's take some numbers. Industrial growth has slowed to <2% this year. No major projects, proposed projects have been getting delayed due to the same reasons like Land issues and delayed environmental clearances. Clearly, the Govt has not defined new rules under which Land can be acquired for any project and if acquired what sort of compensation will it give to farmers. How long will the govt take to bring in that bill? Rahul Gandhi has been shouting for this bill to make political gains over Mayawati, but has not been bothered to push through that bill to make it to the Parliament to discuss it. 

Car sales have slowed down, investment in real estate has slowed down. The amount of dollars that flooded the Indian market in 2009 has clearly reduced to drastic levels. The result is the rupee falling to Rs.53. The compounding crisis of the Europe has also hurt our exports(both goods and services). Neither the Govt nor the RBI have any tools to control this. The only way the govt can bring in the dollars is to increase the confidence in the Indian economy by passing some key legislations like the ones mentioned earlier.

Of 183 countries in the world, India ranks 165th for starting a new business - mainly because of complex rules and red tapism. The new Companies bill drafted by the Govt has to be pushed through the Parliament.

India's electricity and energy sector continues to pose significant problems for the growing industry. No major initiative has been done to drastically improve this sector either.

Looks like the Congress Govt has become lazy, incompetent and over confident. Their over confidence may be that no matter what happens they will continue to be in power. I am alarmingly shocked that when many European nations have had regime changes and new technocrats rather than politicians have taken center stage, our very own technocrat PM Singh lacks political will to bring in changes. His relevance as a technocrat stands completely hollow now. I don't know how many in India think that life has gotten any better ever since the second time PM has been voted back in 2009. It was a golden opportunity that India missed now that the US and Europe's economies have declined.

The time has come to take action. The govt said it has cleared FDI in retail to flood the market with dollars again to counter the depletion and the deterioration of the Indian rupee and economy. There are almost 40 key legislations and none seems to be passing this Parliament session. The opposition party BJP must shout slogans or raise the level of the debate in Parliament but should not stall the passage of many of these bills.

Indian growth story can continue only when the government can take tough policy decisions. Now that the economies of the West are in the dark, it presents a golden opportunity for India to shine. This only can happen if the government wakes up from the sleep.

Friday, October 21, 2011

Reach 1 of Bangalore Metro rolls out

Bangalore for long had wanted the Metro. It started smoothly and later went on a rough patch. With 3 deadlines finally passed reach -1 of Phase-1 was opened for public on Oct 20th 2011. It is 3rd in the country to have a system of this kind and on par with international standards as far as tracks, coaches, signalling is concerned. The excitement that was visible when Delhi metro first started was similarly visible even in Bangalore. I still remember when I boarded the first metro of Delhi - the red line - I was wondering if I was indeed in India !!!

Bangalore Metro is South India's first metro. This has made the people of Chennai, Mumbai and Hyderabad even more restless and are eagerly waiting for their own metros to be completed.

If the excitement and the way people thronged the stations is an indication of anything then it is the rising expectations of the people who are desperate to see how the other parts of the Metro completely finish without missing deadlines.

The stops, the frequency, timings are given below:

The fares are as below:

However, some of the salient features include:

  • Improved sign boards and clear display of information at the station and inside the train.

Flip side:

Train frequency is 15 min (it will be reduced eventually depending upon the demand)
Metro will not reduce traffic congestion drastically (may be 10-20% reduction) and it is too much to expect that given the fact that Delhi, London, Tokyo continue to experience traffic issues and overcrowded trains
At least until the metro is completely over one cannot expect any changes.

Pic courtesy" skyscrapercity, google, youtube, timesofIndia
Feeder buses:
The places where feeder buses serve is in the chart below:

There are lots of questions which can be answered slowly over time. Will Metro be maintained clean? Will there be sufficient patrol of it like in the Delhi Metro? How frequently will the train develop technical snags? Will the escalators work all the time and if it needs maintenance how quickly will be repaired? Will the feeder buses which pick up and drop to nearby areas work correctly and effectively?

Sunday, September 18, 2011

Modi v/s Rahul: Who would win?

It is 2011 and 2014 is 3 years away. In 3 years one never knows where the 2 parties - Congress and BJP would be? As of now, everyone thinks Congress will fail. Congress is too clever at political strategies before the election. They can throw surprises by announcing schemes, or programmes that will make them the hero of the media and the poor. One of the legislation - National Food Security Bill (though has several loop holes) can be Congress's trump card against corruption. It is another matter that this bill will cause incomparable increases in inflation causing further damage to Indian economy. 

3 years down the lane -  the media, the aam aadmi may forget all the movement led by Anna Hazare. Media  may project Congress as the only party to launch such a scheme that will bring down poverty in a single shot. People may forget all the corruption and scandals and think that Congress is still the savior. People may think that both BJP and the Congress stand the same with respect to corruption, but still support the Congress.

At present, why this issue of Modi v/s Rahul? It is very hilarious that a US report conducted by its think tank can cause such a reverberation in India. Modi's announcement of his Sadbhavana mission is being stretched too far by everyone. Neither BJP has projected Modi as its PM candidate and nor has Congress projected Rahul as its PM candidate. Still everyone is speculating that this will be the reality.


The ghost of 2002 never seems to leave Modi. The Supreme court has not found any strong evidence to file even an FIR against him, but it has some strong words for him. Still it has decided to hand over the case to courts in Gujarat. No one knows what the verdict would be. If the High Court proves him guilty, he is bound to have immense losses, but if not he will win handsomely.

If Modi indeed is proven guilty he will have to be punished and there can be no doubt about it. What I admire about Modi is not his character, but his governance. I have a series of articles collected from various national, international media and case studies from IIM Ahmedabad under Modi's governance in my blog.
More than anything else, read this report published by the US which states Gujarat is the best governed state in India followed by Bihar. One can never deny that Modi's rule has given the maximum progress to Gujarat that it leads far ahead than all states in India since 2004. Some people claim Gujarat is progressing for the rich. If that is the case, can anyone explain how is agriculture growing at 10% when the entire national average is 3%? Who is using the 1000 check dams constructed by the govt in Saurashtra (a drought prone zone a decade ago that is now fertile)? Who is benefiting from 24 hour electrification of more than 90% villages that have transformed the lives of farmers? No state has been able to achieve this - states ruled both ruled by BJP and Congress. Just look at the roads that exist in Gujarat. Gujarat is one of the only states in the country where ports are well connected to major cities in the state that has boosted maritime trade.

Some people including the Congress in Gujarat claims that doing business is in the DNA of the Gujarati and so Narendra Modi has not anything much. If that is the case then Gujarat must have been the number 1 state in India since 1947. There should not have been any poverty in the state. There should have been only rich people. No state can achieve progress without the government facilitating an atmosphere where businesses can thrive and farmers can progress. 

No one can forget what happened in 2002 and no one can ever let injustice happen to anyone. People often forget that Modi has been re-elected twice by the people. He has not become the CM through a military coup but through a free and fair election.

Some people have called 2002 riots a holocaust. Every communal riot is a holocaust. Even those which occurred during the Congress rule (This was in 60's and  70's when BJP did not even exist) . 


I frankly admit that if Rajiv Gandhi was alive today and stood for elections, I would have really wished him become the PM again. Manmohan Singh is far far better than Rahul Gandhi. Manmohan Singh may not take decisions at the right time, but he has a statesmanship approach when he wants to talk to his worst detractors. When the entire nation rose in support of Shri Anna Hazare (my hero these days), I expected Rahul Gandhi at least to come out and say that he would convince his party and the government that the voice of the youth will be heard and Anna Hazare's peaceful protest shall be respected. Where was Rahul Gandhi when Kapil Sibal and P.Chidambaram decided to arrest Anna? Where was Rahul Gandhi when the entire Parliament was discussing the issue of Lok pal bill? I salute Pranab Mukherjee who stole the show from the Congress side in Parliament. An old Pranab was far capable and convincing than a young Rahul who was absent. My biggest problem with Rahul is that when the time arose that India needed leadership from the side of the Congress he let everyone down.

The Reality: Congress still has a higher chance of winning in 2014 than the BJP. 

The big strategy which BJP has to adopt is not to declare anyone as its PM candidate (more so that of Modi). This was the same strategy which Congress adopted in 2004.

Let's not forget that Congress still has a presence in almost every state unlike the BJP. If Modi is projected as the PM candidate, the chances are that several allies may desert the BJP because of a fear of loss of vote banks. In that situation BJP has to win around 200 seats on their own which seems highly impossible. So either way it is a tough road ahead for the main opposition party if it projects Mr. Modi as the PM.

People are the ultimate deciders of the 2014 election, but people must exercise enormous caution specially now that India is one of the rising economic powers of the world. The challenges and complexities are high and we need a leader who has proven something and not just talked. We need a leader who can rise to the occasion and take tough measures and decisions to take the entire society on the path  of growth. We cannot be slow and steady, but fast and tough.

Sunday, August 14, 2011

How did India escape the global recession of 2008?


Everyone these days is talking about economy. Ever since the world markets crashed and the US rating went down from AAA to AA, it has been a matter of growing concern. Two countries which continue to prevent the whole world falling into recession include India and China.

Even now Brazil, Chile and many countries are learning from India how to manage capital flows (international money flowing into markets). India truly went beyond the regulated norms of IMF (international monetary fund) to use a variety of techniques in tandem to prevent a collapse. This is a fact that India was chosen as one of the top contenders for G-20 - a forum where developed countries wanted the inputs from developing countries like India and China to help in their revival. Let us feel proud as Indians on this Independence Day despite all the complaints we have from our corrupt politicians. We continue to grow!!!

How did India escape the recession in 2008 when the mighty US and Europe fell like a deck of cards? 

The answer is not simple and I have tried to answer in a simple manner in this article.

Prior to 2007, the global liquidity was very high. Cash was surplus and money was flowing into emerging markets quite rapidly because the return of investment was quicker especially in India and China. India was growing since 2000 when the Vajpayee led NDA government brought in huge reforms leading to 6% growth unseen in the earlier years.  The country was expanding and was giving higher returns on investment from foreign countries. Then came the Congress led UPA Government. When UPA govt introduced National Rural Employment Scheme (NREGS), it brought cash into the hands of the unemployed; sufficient enough to buy pulses, simple clothes and many more. Although there is corruption in the implementation of NREGS it truly added life to the rural economy.

Remember: India saves 33% of its earnings compared to 40% w.r.t Chinese and 1/5th of what India produces is only exported. The rest is used for domestic consumption. This is a unique economy unlike China which heavily survives on exports. However, even when export demand crashed, China continued to grow (still growing) as it is spent huge amounts in infrastructure in its own land. 

The Indian economy was such that it was heavily dependent on domestic banks for its fiscal needs. This was the case till 2005-06. From the late 2006 large parts of govt funding began to come from these foreign investments which directly come as cash or investment like FDI (Foreign Direct Investment). This was the reason that Govt's foreign exchange reserves came to more than 30 billion$  to around 300 billion during that time. But in any emerging market this capital has to be controlled because if this depletes suddenly, the govt will have nothing to fund its own programmes. 

The Indian debt market (the market in which the investor gets Govt Bonds in return for investment - the largely dominant debt market component) has been till now restricted enabling both the Govt and the central bank (Reserve Bank of India - RBI) to manipulate as per the needs instead of a free flow. This is perhaps the biggest macroeconomic feature India has. If the debt market is allowed unhindered the capital accumulation can be very high and the RBI would not be able to control this. 

In other words to summarize things explained in the previous paragraph it means there is a limit on the extent and the amount to which bonds can be issued by RBI on behalf of the govt. Just because a foreigner wants to invest in return for a bond doesn't simply get to do this. Also, the corporates across various sectors cannot borrow how much ever money from international market. 

No one knows if India has the capability to completely go to a system where such limits do not exist. But by restricting so, RBI can control both exchange rate (the rupee-dollar rate fluctuation) and price stability (where the inflation and deflation - neither of them happens over a certain time and prices remain stable).

Given this scenario in early 2007, due to rising capital in the market the RBI resorted to further cap the inflow, restricted overseas borrowing for corporates beyond a certain amount. The central government disposed off huge amounts as loans in a regulated manner to people (education loans, home loans, auto loans etc) which spurred the domestic growth further. That is why from 2005-07 the growth rate was close to 9% in addition to rising incomes. 

After disbursing a huge amount of its reserves as loans, RBI stopped further easy lending of loans by hiking interest rates. At the same time the govt sterilized huge sums of money through 

a) Market Stabilization Bonds (this is a mechanism by which excess dollars will be absorbed by the RBI. RBI  in return will inject the equivalent Indian rupees in the market. If these rupees continue to flood, RBI would sell Govt bonds and the money raised would be given to government to fund its fiscal needs and the govt would have to pay interest on it to RBI). Market Stabilization Bonds is truly a new thing implemented in India.
b) increased the cash reserve requirements for banks (banks need to maintain cash as reserve and not spend it as loans).

Despite this the surge continued even further. In mid 2007, the RBI raised interest rates after seeing an overheated economy. Adding to rising interest rates there was a huge inflation already because of govt's mismanagement of food distribution ( a problem that plagues India till date).

RBI''s options were so less to contain this money flood. Economics is not physics as explained by RBI Governor (Subbarao in a speech. Click here). Unlike physics where human influence doesn't change underlying facts, human behaviour can definitely impact an economy and again it is humans who have to act to control it. 

By mid 2007 the trade and financial integration of Indian economy with the world had gone deeper. 

RBI could have easily allowed the rupee to appreciate but it could not do so as exports could be hurt. It could not lower interest rates as it would have overheated the economy. The only thing it then began to do was some out of box thinking like imposing further caps over overseas borrowing (loans above the limit had to be left overseas itself), prohibited foreign currency conversions into rupees and many more as explained in this detail paper. IMF provides a lot of guidelines to help countries in this regard, but India's case was very unique. So, RBI had to resort to some extra ordinary actions.

All these steps prevented a collapse of the Indian economy during the great global recession in late 2008. It only shows how RBI acted like a great watchdog. However, the fact that should not be underestimated is that our growth rates slipped to 6% during that time and our exports which grew by 25% during 2005-08 dropped to 12% eroding lots of money from the middle and poor people involved in these.  

In addition to these the corporates who were getting easy international loans had to resort to domestic banks for survival and expansion. This was all in addition to stock market crashes even in India where thousands of crores were withdrawn from the market. 

Post 2008, Indian economy began to grow mainly because of domestic consumption again and govt's stimulus which cushioned the exporters against heavy losses. Due to increasing spending on national highways, new projects to increase electricity generation, higher incentive on manufacturing, increasing number of IT presence of MNC's, growing auto sales and many more Indian economy showed a robust growth of 6% better than growth rates of the West.

How is the economy now in 2011? What lies ahead?

The answer to this question also is not too very positive(Click here). The inflation continues to grow alarmingly. The govt totally is not initiating any reforms to improve the supply side of food. The UPA-2 seems to be caught in enough scams and misgovernance that it has stopped functioning. Already there is slowdown in industrial growth and infrastructural growth and this is slowing down the economy to below 6%. We are still doing better than Europe and the US, but we can do much better to compete with Chinese economic growth.

Hope the sense of judgement prevails and the govt would initiate the much needed Land Acquisition Act which is badly needed for a desperately growing India.

Jai Hind!!

Sunday, July 24, 2011

The Govt drafts Lokpal legislation which is meaningless

When Congress President Smt. Sonia Gandhi said that corruption has to be removed and she will support the movement started by Anna Hazare I suddenly thought may be she will be instrumental in making this legislation a reality. But Congress party doesn't seem to show any interest. It is shocking that Manmohan Singh whose honesty has never been questioned is now being called honest king of a corrupt government. He doesn't even express how his own government's anti-corruption legislation is toothless. Ask a common literate man to read the draft given by the Government and he/she will just say it is -"NONSENSE".

As per govt, Lokpal will

a) Not have police powers, cannot file a FIR and will be an advisory body
Then why establish it? The Central Vigilance Commission is already there doing this job and advises government to act on it, but the Govt never acts.

b) Only if Lok Sabha speaker/Rajya Sabha Chairman gave permission action would be taken against the corrupt MP's or MLA's:
This is the funniest part. How can the speaker decide on if action has to be taken against a MP or not? Will the speaker's judgement be so trustworthy? Never. This is the most nonsensical part of the legislation.

c) People cannot file complaints to the Lok Pal.
For whom is this Lokpal? For people or the government's corrupt officers to protect themselves? The government's logic is people might misuse the lok pal. How can the government conclude this?

d) CBI and Lokpall will not be inter connected.
Then CBI which is already corrupt will continue to promote corruption and Lokpal would not be able to do anything.

e) Punishment is 6 months to 7 years and not necessarily all the money/assets will be seized/recovered:
Which means a politician will be ready to go to jail, but his assets will be with him even after he comes back from jail. This is more crap than Ekta Kapoor's crappy serials. How can a honest PM accept for a legislation like this, especially someone who opened up this country for reforms.

f) Lokpal won't be applicable for cases against judges:
This is a tricky part and I agree with the Govt's view that if judges are brought under Lokpal who will investigate against Lok pal itself if it turns corrupt? Not involving judiciary is not as much a big concern than not taking effective action against MLA, MP and bureaucrats.

g) The PM cannot be investigated in the matters related to foreign affairs, defense and security until the PM demits office.
This is understandable and is not a big issue. Really for the public - the "aam aadmi" for which this Govt works as per the claim, the PM is not a problem. The local bureaucrats, MLA, MP's are the problem. Hence, Anna Hazare would do a big mistake if he breaks talks with the Govt over this reason. This can be handled even at a later point after the legislation is brought in. Think of it - How many Indians feel any difference even with a honest PM like Singh? Does a honest PM make any difference? 
The PM is not a reason to worry, but the local MLA definitely is. 

Anna Hazare's version of Lokpal contains provisions that will create a super body that will consume all major investigative agencies and will apply to everyone. This is good, however a super body means that powers must be carefully defined.

I seriously fail to understand how can the Congress party even propose such a legislation which would not do anything. And I can't believe even if this legislation gets passed, it will enthuse people if any.

The tragedy of the nation is that the principal opposition party neither indulges nor inspires this nation as to how they would like the Lokpal.

It looks like India need of a strong leader who can act and deliver.

Saturday, June 18, 2011

The future of Rahul Gandhi's strategies

Indian media is known to hype matters on several issues much like international media. For the past few years, it has been over hyping Rahul Gandhi and his future. No one knows if this over hype may actually become reality and one day we see Rahul Gandhi as the PM.

However, as a citizen Rahul Gandhi must do more than held press conferences or sleeping in Dalits homes. India is not 1970 where these things translated into sympathy and people voted that person. In Uttar Pradesh, Bihar and Tamilnadu Rahul tried to deliver the power of youth, but failed miserably. If present India is to this state, it owes a lot to Gandhi family for all good and bad reasons. If his predecessors - Rajiv, Indira and Nehru did a lot good to this nation, they did far worse when it came to corruption and lack of transparency in governance and even eliminating poverty.

Recently, Rahul Gandhi made this remark - "I have seen the violence unleashed on your men and women. By seeing what has happened here, I feel ashamed to be an Indian. The state government is tormenting its own people. I was travelling with the Assistant District Magistrate and he told me that it is like Naxalism has reached here" (click here)."

I am surprised and shocked at this naive statement made by him. He made this when he declared that in Bhatta Parsaul village in Uttar Pradesh (UP) where farmers were protesting against land acquisition for Yamuna Expressway. He said women were raped and farmers were killed who were protesting. He showed a site of bodies and said they were buried there. When a team of forensics held the investigation they found everything was false. The ashes contained that of animals and not that of human flesh (Link).

Why did Rahul Gandhi do this? Simply because it is elections time in 2012 and he wants Congress to win UP state. Winning this state paves the way for a clear majority Congress at the Centre. Remember Congress lost all the Muslim and Hindu vote banks in 1992 after the Babri Masjid Demolition and never has Congress recovered from it again till now.

Rahul tried to imitate what Indira Gandhi did in the late 1970 when she rode an elephant and visited Belchi village and highlighted that the Central Govt is insensitive to the atrocities on Dalits and she came back as PM. But India is not the same as it was in 1970. Today, people look for leaders who can think out of the box solutions to solve India's problems.

Rahul further declared he would bring in Land Acquisition Bill in monsoon session of Parliament this year and get it  passed.

Here is a series of questions to him:
  • Why didn't Rahul protest like this when farmers were shot in Nandigram and Singur for Tata's project by the West Bengal Left Govt who was an ally with Congress at the Centre? Why didn't he come out on the streets and say - "I am ashamed to be a part of the Central Govt where one of my allies can order such a shootout on farmers who do not want to give up the land". 
  • Why doesn't Rahul Gandhi feel ashamed that despite the slogans of "Garibi Hatao" in 1970 by Indira Gandhi, poverty is still 30% in India? 
  • Why doesn't Rahul Gandhi feel ashamed at his own party government in Delhi? Why? Every other day a woman is raped in Delhi. No one is concerned - neither the Govt led by a woman herself Sheila Dikshit or the party. I am ashamed to see the capital city as "rape" capital. I am ashamed that a woman is either kidnapped, raped or killed in Delhi and the govt doesn't act over it. If the capital can't be safe, how can India be which is ruled by his party for the past 7 successive years and almost 50 years since Independence. 
  • How can his party support Mayawati and remove her name in CBI's list of investigations and later blame her for all the state govt's problems?
  • This country was ruled for a full term by the non-Congress PM Atal Vajpayee for just 7 years. So, why blame any other party or regional party for the failure of India's problems? Congress party is not the same anymore which gave us the Independence. Rahul must re-invent Congress's vision before he can show he can make a difference to this country.
  • Why didn't you protest when farmers in Vidharbha in Maharashtra (which is also being ruled by Congress for the past 10 years) committed suicide for not enough support from the state Govt? You were considered the crown prince of India since then.
  • Why is that the Land Acquisition Act (which was so much in the mind of the PM Singh to get it passed way back in 2004) has not been passed? It should have been passed right after farmers were shot by Left Govt in West Bengal. Only for the sake of vote bank politics the Congress govt from 2004-09 was silent.
  • Why don't you force the govt and your party to take a strong action against all the black money lying abroad which could be brought back.
Rahul Gandhi, definitely, has the zeal and age as a factor on his side. However, even before you are elected you you need to convince India why it should buy your speeches? Why your silence on several matters that are troubling "aam aadmi" of which you represent is so high? Why don't you speak out what your solution is to the problems of India.

It is not as if BJP is crystal clear on corruption and issues of the country. They too fail to give a vision as to how they would sort out issues like Land Acquisition and corruption. However, it is to the credit of the Opposition led by Left and BJP that Congress govt was brought on its knees and exposed such large scale corruption never seen in India before. There is a lot for the present Govt to learn from Land Acquisition Acts in Uttar Pradesh and Gujarat. There is a lot that the present Govt can learn from Right to Service Acts passed in Bihar and Madhya Pradesh. They are simple, but are proving to be effective solutions.

Indians know that they are growing. 8-9% growth is not alone going to help Congress. There are matters far troublesome which no one wants to address. In a scenario like this I would say Rahul's strategies have clearly failed.

There is a far more social revolution India needs and that can happen only if social problems are addressed through an economic reform, which is not impossible. It just requires an iron will.

Sunday, May 8, 2011

The New Delhi Airport Express link opens with check in facility

In my last article (CLICK HERE) about the New Delhi Airport Express link I had mentioned that this is going to be one of its kind in India. It missed its deadline in Sept 2010 and finally opened in Feb 2011. The reviews have been good if not great and there are many plans drawn to improve the experience of this express link.

It is beyond doubt that this is helping a lot of commuters who want to reach the airport from the heart of the city or Delhi-Gurgaon expressway area (NH-8). This train connects the Indira Gandhi International (IGI) airport in 18 minutes and the train runs with a speed of 135 km/hr. The total length = 22.7 km of which 15.7 km is underground and the rest elevated.

From the NEW DELHI RAILWAY STATION to the airport the cost is Rs.80/- and upto Dwarka Sector 21 is Rs.100/-. The frequency is 20 minutes and it runs from 5 am to 11 pm.

And finally, one can check in luggages at New Delhi Station and Shivaji Stadium. For more, one can visit this site of Delhi Airport express.

Remember: If you are a person who drives on Delhi's roads you would better appreciate the massive importance this link would give you instead of taking 45-60 minutes to reach the airport from the heart of the city through road.

The stations also show the flight timings. These stations are guarded by Central Industrial Security Forces (CISF). This was done after hectic discussions with Ministry of Home Affairs.

Flip side:

1) Sign boards need to be improved.
2) Check in counters are less in number
3) Ridership is 8000 per day which is low compared to the intended capacity.