« the ego has landed »

Economic superpower rises in the east

ASEAN + India + China + Japan = The world's most populous Free Trade Zone

At the ASEAN summit at Bali, the ASEAN leaders inked what is called "The Bali concord II" which attempts to eliminate tariff and non-tariff barriers, standardise customs procedures, gradually reduce capital controls and abolish visas in a region that is home to 500 million people by 2020

This with the stated intention of inking deals with India, China and Japan does give rise to visions of an Economic superpower which would act the right ballast to the US and the EU

Has the Sun begun to set again on the western empire ?

Guardian Unlimitedt
The Financial Times

Rupee zooms to 3-year high against American dollar

Is it now time for the RBI to intervene in the Forex market and try and hold the Rupee/Dollar exchange rate for a while ?

With bouyant Forex reserves and growing FII investments in India, the Rupee would only continue to appreciate against the dollar ... and not all of this would be sweet news for Exporters

HindustanTimes.com

Supreme court slams the brakes on PSU Divestment

In a landmark judgement that can perhaps deeply hurt the Government's aggresive plans to divest its stake in Public Sector Units (PSUs), the Supreme court has ordered the Government to seek the Parliament's approval before proceeding with the proposed divestment in the oil majors HPCL and BPCL since these were incorporated by acts of parliamentary legislation

While prima facie this seems to be a valid judgement, on deeper thought, this could perhaps derail the much needed progress being made in the divestment front and could perhaps affect the Budgetary defict

The Government now requires a two-thirds majority in Parliament before the due-diligence excercise could commence. Given the combative postures being taken by the opposition as well as interests with the Governing coalation, this seems to be far-fetched dream

One wonders why the Supreme court did not take a similar stance when mills belonging to the National textile coporation (NTC) were closed down, since these mills were nationalised by the Parliament itself

For now, it seems like there would not be any progress made on this front, atleast till the General elections in 2005

My sympathies, no doubt lie with the Divestment minister Arun Shourie who had to hide his dissapointment by quoting :

The order would have far-reaching consequences, not only for disinvestment in these two PSUs, but in other matters also

The Economic Times

Singapore issues @ Cancun !

While the EU has finally stepped down from its rigid and obsurate stand of being unwilling to discuss the 4 Singapore issues :
* Multilateral agreement on Investment
* Competition policy
* Transparency in government procurement
* Trade facilitation
seperately, one wonders as to why a country like India should enter into negotiations / discussions on issues such as this when the core issue of Agriculture is still out there in the open and by all possible indications still a very complex and convoluted route ahead till some light is found at the end of the tunnel

With good progress being made with the G21 on these issues, I belive that the focus of the Indian delegation should be on getting the Western world to correct the imbalances that their domestic and export subsidies are causing in the global trade in agricultural products (by effectively out pricing most the so-called third / developing world) while at the same time looking at areas in Agricultual products as well as Industrial goods where we need to open up further by reducing tariif barriers

While it will be a story of give and take, the US and the EU would need to be giving more than taking this time round. Any obduracy on their part would only make Cancun another Seattle !

Economictimes

The challenge of free trade

Given the United State's penchant for closing out bilateral trade deals rather than negotiations under the aegis of WTO, my earlier worry on how the US would end up winning on other grounds (political / military) in return for Trade concessions is only getting heightened

Reuters AlertNet - FEATURE-The challenge of free trade

India's WTO battle

Given that India's prime gripe against the US, EU and the rest of the developed world is the obscenely high levels of Domestic and Export subsidies given for Agricultural produce which effectively prevents Indian Agricultural products from competing with the developed world in the International market, the ideal deal would be one wherein US and EU agree to reduce subsidies in Agriculture (both above and below the line) in return for Market access by the developing countries (including India)

However, looking at the general sentiments being expressed, the current strategy being adopted by India in terms of building a consensus of opinion amongst developing countries might not work, given that India tried a similar approach at Doha only to be left in the lurch by countries like Brazil and China who struck one on one deals with the US and EU

The worst case scenario that I forsee is one in which the US makes some consessions to India in the disputed Agriculture issues in return for commitments from India on troops deployment in Iraq. This no doubt would be an unkind cut, but I belive that the US is certainly capable of such arm-twisting

India's WTO battle: The twists ahead

The untold story of the Indian Exports success

If you thought that the only export that India does is in the IT software sector, think again !

Quoting Arun Shourie :

Here is proof positive that liberalisation has indeed worked. ‘‘By opening the economy before giving it a chance to become competitive, we have thrown our industry to the wolves,’’ it used to be said. Quite the contrary. The success in exports, in fields such as IT in which competition is fierce, in which technological change is fast as lightning, success in auto-components, in pharmaceuticals shows that our industry has fought back, it has become competitive.

Did you also know this :
India has amassed a Trade surplus to the extent of half a billion dollars with China in the first 5 months of 2003
Our exports, despite a growing recession in the west has grown by 19 %
Out Forex reserves are at an all-time astounding high of 82 billion USD

Indian Express

Quantum Mechanics and the Markets

Markets (Stock / Commodity) are non-linear and dynamic. Using Chaos theory analysts have pointed out that market prices are highly random with a trend component. Using the example of fractals, where the parts in close scrutiny are replicas of the whole, a similar comparision in drawn with yearly, monhtly, weekly, daily prices where the long-term trend is also reflected in the smaller time slices.

From The Big Picture and Commentary by Bruce Babcock

Electronic filing of Income Tax returns

The Finance minister has announed that it would be possible to file Income Tax returns in India from friday.
Wow ! This is indeed a neat idea. In a way this sort of formalises the process which a lot of us follow out here in using various CAs etc to file our Income Tax Returns.

From Times Of India