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THE HIMALAYAN DISASTER: TRANSNATIONAL DISASTER MANAGEMENT MECHANISM A MUST

We talked with Palash Biswas, an editor for Indian Express in Kolkata today also. He urged that there must a transnational disaster management mechanism to avert such scale disaster in the Himalayas. http://youtu.be/7IzWUpRECJM

THE HIMALAYAN TALK: PALASH BISWAS TALKS AGAINST CASTEIST HEGEMONY IN SOUTH ASIA

THE HIMALAYAN TALK: PALASH BISWAS TALKS AGAINST CASTEIST HEGEMONY IN SOUTH ASIA

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Wednesday, August 22, 2012

Open Market Economy Kills opportunities in Trade and Commerce for Indians and just boosts Multinational Portfolio!Bank strike hits transactions and some market operations!Indian Politics has no sympathy!

Open Market Economy Kills opportunities in Trade and Commerce for Indians and just boosts Multinational Portfolio!Bank strike hits  transactions and some market operations!Indian Politics has no sympathy!

Indian Holocaust My Father`s Life and Time, Chapter- Eight Hundred Ninety Five
Palash Biswas

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Open Market Economy Kills opportunities in Trade and Commerce for Indians and just boosts Multinational Portfolio! FDI in multi-brand retail without adequate safeguards will lead to widespread displacement and poor treatment of Indian workers in logistics, agriculture and manufacturing, the government today cited a global report on Wal-Mart as having said.On the other hand,Bank transactions and some market operations were hit in India after about one million bank employees began a two-day strike on Wednesday to protest against reforms that will give investors more clout in the tightly controlled sector.The strike involving mainly staff of state-run banks, who make up around 70 percent of employees in the sector, underscored the opposition to investor-friendly financial reforms that have been pending for years.Foreign ownership of Indian public sector banks is capped at 20 percent, and some global banks have been pitching for a hike in their holding limit to expand their presence in Asia's third-largest economy by acquiring smaller regional banks.In what is being seen by analysts as a positive step towards reform, parliament is likely in coming days to approve amendments to banking laws that include raising the limit on shareholders' voting rights in public and private banks.India has struggled to reform and liberalise key sectors such as banking, retail and insurance, partly because of political opposition and fears of the exploitation of domestic interests by foreign investors.Mind you,The decision to allow 51 per cent Foreign Direct Investments in multi-brand retail has been put on hold by the government following strong objections from the Opposition and key UPA allies Trinamool Congress and DMK. Traders across the country observed Quit India Movement Day as Quit FDI Day to protest against foreign investments in multi-brand retail by staging dharnas.The Confederation of All India Traders (CAIT) said the government has assured that a consensus on the issue will be arrived at only after consulting all stakeholders including traders, farmers, consumers and various political parties.But it has not to be. Bank strike proved the apathy of the ruling class in most crude style.Foreign investments by MNCs will hijack the country's retail trade which would lead to closure of majority of small businesses and job losses for lakhs of people engaged in the sector!

India should allow foreign direct investment in multi-brand retail besides taking other economic reforms to further enhance the country's economic growth, US Ambassador to India Nancy J Powell has said. "For India to return to faster growth, new policies and economic reforms need to be
put in place by the government in areas such as opening multi-brand retail up to foreign direct investment," Powell said at an Indo-American Chamber of Commerce (IACC) programme in varanasi on July 27, 2012.No Political party dares to violate Washington dictations.On July 15, US President Barack Obama had said that India has prohibited FDI in too many sectors such as retail and cited concerns over deteriorating investment climate.The US-based Walmart, world's largest retailer, is keen to open stores in multi-brand retail sector in India.The decision to allow 51 per cent foreign direct investment (FDI) in multi-brand retail was announced in November last year.

Commenting about the bilateral trade, Powell said last year, the US exports to India touched $21 billion.

"Our total bilateral trade in goods and services is expected to reach $100 billion this year. India has leapt from our 25th largest trading partner to our 13th largest trading partner in just over a decade," she said adding increasing number of Indian businesses are interested in investing in America.

She said that the US provides huge opportunities for investment for Indian companies.


Indian politicians kept aloof from this unprecedented economic crisis as the citizens are deprived of drawing money from ATM. Reforms stand on top priority to sustain free foreign capital inflow. Banking sector reforms target for resurgence of capitalist monopoly in the Banks which would hit small trade and commerce most and would block economic empowerment of the masses despite Chidambaram`s claim to sustain consumer market. It is now proved that Chidmabaram means the consumer market monopolised by the Multinationals only.The strike, which forced No. 1 lender State Bank of India (SBI) to halt trading in onshore spot foreign exchange markets, comes as another blow to an economy facing its worst slowdown in almost a decade.Employees of public sector banks have begun a two-day nationwide strike on Wednesday opposing banking sector reforms and outsourcing of non-core activities, affecting operations.The strike call was given by the United Forum of Bank Unions (UFBU), an umbrella organisation of nine unions of employees and officers of PSU banks, protesting banking sector reforms and unilateral implementation of the Khandelwal committee report on human resources management in PSU banks. The strike has been called against government's policies of liberalisation, privatisation and globalisation.  

Bank unions are demanding stringent and effective measures to recover bad loans

"The strike is on since this morning. Nearly 10 lakh employees are participating in it. This includes 24 public- sector banks, 12 private banks and 6 foreign banks," All India Bank Employees Association (AIBEA) General Secretary C H Venkatachalam told PTI.He also said that ATM machines will work until they have the cash and thereafter those services will also be impacted.

If parliament approves the changes on Thursday, the limit on the voting rights of shareholders in private sector banks will be raised to 26 percent from 10 percent now, and to 10 percent for state-run banks from just 1 percent.The move would give overseas as well as Indian financial institutions and fund managers more say on the functioning of the banks and help improve operations and transparency, analysts said.

"From the market point of view, it is good because FIIs will have a lot more say," said Jagannadham Thunuguntla, equity head at Delhi-based brokerage SMC Capital, referring to foreign institutional investors (FIIs). "Probably, we may expect more FIIs buying in the banking sector."

The proposed changes to banking regulations would also help the central bank issue more banking licences, which would boost the prospects of many Indian and foreign firms who are looking to tap the country's under-penetrated financial sector.While the changes will meet a key demand of foreign investors, they are unlikely to trigger fresh private investment, largely because the 20 percent cap on foreign ownership in public sector banks will not change.

Open Market Economy does not boost opportunities for trade and commerce for Indians. It is all about Foreign Capital and supremacy of multinational companies along with Corporate India. Deprived of job and livelihood, the massive number of Indians engaged in trade and commerce may not survive in an environment of indiscriminate foreign capital inflow as they may not compete with the giants with small capital and smaller favour. Corporate lobbying makes policies, effects legislation and expediates reforms to kill these people from the masses engaged in trade and commerce. No Politics as misunderstood does represent these tiny businesspersons`s class who mostly belong to villages and small towns, displaced from rural world due to agrarian crisis.

The most corrupt political class does defend the multinationals and India incs only as the Coal gate has showcased. With the Opposition targeting the government over CAG report on coal allocation, Prime Minister Manmohan Singh is geared up to rebut in Parliament the charges, contending that there were "inaccuracies" in the "misleading" assessment of loss of Rs 1.85 lakh crore.

Multinational companies in India have delivered higher returns across sectors such as FMCG, pharmaceutical, automobile ancillaries and capital goods over the last three years compared with their Indian peers, riding on the back of superior technology, products and brand equity.As the government struggles to build a political consensus on foreign direct investment (FDI) in multi-brand retail, the Prime Ministers' Economic Advisory Council (PMEAC) on Friday suggested the government initially allow up to 49 per cent FDI in the sector, instead of the 51 per cent approved by the Cabinet.

Releasing the committee's outlook for 2012-13, PMEAC Chairman C Rangarajan said allowing 49 per cent FDI would signal the government's commitment to furthering the process of reforms. "You have to put in effort for policy action. So, we have suggested allowing 49 per cent FDI in multi-brand retail to begin with, to bring more people on board," Rangarajan said.

Foreign direct investment (FDI) in multi-brand retail will not help farmers in getting good prices for produce, creating infrastructure and reducing inflation, experts have said.

Confederation of All India Traders (CAIT) Secretary General Praveen Khandelwal said that instead of depending on foreign investment to improve back-end infrastructure like cold-storages, the government should focus on strengthening domestic retail sector.

"It is a dream that foreign retailers like Walmart will come here to construct cold-storages and other back-end infrastructure. FDI will not help in reducing food prices too. In fact they go for predatory pricing and it will severely impact small traders," Khandelwal said.

He said that to bridge price difference between farm gate and consumers, the government should fix price bracket.

Expressing similar views, India FDI Watch Director Dharmendra Kumar said global foreign retailers will kill mom & pop stores in the country, which would lead to unemployment.

On the matter that FDI in the sector will help farmers in getting good prices as global players will go for contract farming, Kumar said as per a study over 50 percent of Punjab farmers have refused to enter contract farming.

"Though there are case studies which show success in contract farming, but more number of cases are there where the concept has failed," Kumar added.

He said the government should focus on developing modern infrastructure to reduce wastage of farm produce and farmer cooperatives need to be set up to address farmers grievances.

He also emphasised that the Agricultural Produce Market Committees (APMC) Act should not be abolished as it would provide healthy competition.

Bharat Krishak Samaj Chairman Ajay Jakhar too advocated for continuation of the act.

Opposing FDI in multi-brand retail, BJP National Secretary P Muralidhar Rao said: "I am unable to understand which foreign company is going to open cold storage if you do not have proper roads and adequate supply of power. FDI in retail is a serious political issue as it is related to large population of India".

Centre for Policy Alternatives Chairman Mohan Guruswamy said no empirical evidences are present to support the argument that entry of foreign players in the sector will increase farmers bargaining capacity and reduce wastage.

"If the foreign retailers will come to, it will have collateral damage. All this is rubbish that FDI in the sector will reduce wastage," Guruswamy said.

Citing studies, he said that despite presence of global retailers, regions like Europe were not able to reduce their agricultural wastages.

The Cabinet had decided on November 24, 2011 to allow 51 percent FDI in multi-brand retail, but the same could not be implemented in the face of strong opposition from UPA allies including Trinamool Congress, and several state governments.

However, Ficci Additional Director Nirupama Soundararajan said, "By allowing foreign retailers, you will give an option to a farmer to sell his produce. They will gain along with consumers. Traditional retailers will coexist with big stores. FDI will not lead to closure of mom & pop stores."

She said that the decision would help in increasing farmers bargaining power for prices.

"Traditional retailers, middleman or intermediaries are not going to disappear because of this," she added.

Sharing similar views, Rajinder Kumar Sharma, Chairman, Agriculture Produce Marketing Committee, Azadpur, Delhi said that farmers will get good price for their produce.

Technopak Advisors Chairman Arvind Singhal said there is an urgent need of reforms in the agriculture sector in order to help small and marginal farmers in the country.

Singhal said to deal with predatory pricing, Competition Commission of India is there to deal with such matters.

He said that the size of merchandise retail consumption in India has touched USD 470 billion in 2011 from USD 120 billion. Organised retail size has increased only to USD 25 billion last year from USD 2.4 billion in 2001.

Economic think-tank ICRIER Professor Arpita Mukherjee said global retail players will invest huge amount and help in creating jobs in the country.

"Foreign retailers will provide farmers better technology and market and best thing is that they will provide options to both farmers and consumers," Mukherjee said.


ET report exposes that The top 500 listed companies have enough cash on their books to double India's power generation capacity of 2,00,000 mw or build over 40,000 km of six-lane highways every year (compared with the current 800 km), but are refusing to invest because of slowing economic growth that has been aggravated by policy paralysis.

Companies such as Reliance Industries, NMDC, Coal India and Infosys are holding on to twice as much cash compared with three years ago, according to an analysis by the ET Intelligence Group.

The strong cash balance of these companies, and others such as Sterlite Industries, Steel Authority of India, Nalco and Oil India led to a growth of 26% in the total cash reported by companies in the BSE 500 for the three years ended March 31, 2012.

At the end of last fiscal, India Inc was sitting on cash and cash equivalents - liquid investments that can easily be converted to cash - of over 9.3 lakh cror, or $166 billion.

This was actually marginally lower than the record level of 9.8 lakh crore in FY11 - the fall of around 5% in FY12 reflecting mounting pressure on profits due to rising input costs, slowing demand, and higher interest costs.(http://economictimes.indiatimes.com/news/news-by-company/corporate-trends/slowing-economic-growth-companies-like-ril-cil-and-infosys-sit-on-a-cash-pile-of-rs-9-lakh-crore-and-refuse-to-invest/articleshow/15562862.cms\).

However, before taking a decision, top international retailers should be consulted, the report suggested, adding this would ensure investors favoured the decision, and states favouring the move could implement it soon.

Meanwhile, Rajasthan on Friday joined Delhi, Uttarakhand and Manipur in extending support to open the multi-brand sector to FDI. In a letter to Commerce and Industry Minister Anand Sharma, Rajasthan Chief Minister Ashok Gehlot stated, "I would like to assure the cooperation and support of the Raja-sthan government for liberalising and opening of this sector."

The PMEAC report stated FDI was an important mechanism for channelling capital and technology and promoting growth. It added FDI in multi-brand retail would help attract investment and improve the supply chain infrastructure for farm produce and related activities. This, in turn, would help farmers and producers, benefit customers and create jobs.

The council also suggested allowing foreign airlines to bring in FDI of up to 49 per cent in Indian airlines.

FDI is vital to help tackle India's declining investment rate, which stood at 34.7 per cent in 2011-12 and 2010-11. For this financial year, PMEAC pegged it at 35.3 per cent. This, too, would be lower than the 38.1 per cent investment rate in the pre-crisis period of 2007-08.

The domestic savings rate declined from 32 per cent in 2010-11 to 30.4 per cent in 2011-12. For 2012-13, PMEAC estimated it at 31.7 per cent. The savings rate in the country has been declining, owing to pressure on margins of companies and a decline in household savings. The government's savings also entered negative territory due to the subsidy burden.

Therefore, PMEAC suggested the Centre rein in fiscal deficit at the budgeted 5.1 per cent, even as it said recent slippages in fiscal deficit raised questions on the government's commitment. According to the International Monetary Fund's fiscal monitor released in April, India was among the most fiscally stressed emerging market economies. PMEAC member Govinda Rao said reining in fiscal deficit at the budgeted target was "non-negotiable." He, however, added fertiliser subsidy might see a decline this year due to the weak monsoon. Fertiliser subsidy in 2011-12 stood at Rs 67,000 crore.

As merchandise exports contracted for three consecutive months so far this financial year, the council said it expected growth in outbound shipments to be lower than the commerce ministry's projection.

Against the ministry's projection of $360 billion f exports this financial year, PMEAC estimated exports at $334 billion.

PMEAC also suggested the government continue to negotiate with states to roll out the Goods and Services Tax. It said the negotiations were stuck on the issue of paying compensation to the Centre for loss in revenue due to a cut in central sales tax.

On recent criticism of disconnect between the Index of Industrial Production (IIP) and sales of companies, PMEAC member Saumitra Chaudhuri, said, "Prima facie, there is a problem in IIP. You can use corporate results as a validation to see whether there is a match or not." Rangarajan said data from companies was corroborative evidence and if suitably adjusted for inflation, it could give an indication.

Minister of State for Commerce and Industry Jyotiraditya Scindia informed the Rajya Sabha in a written reply, that Switzerland-based UNI Global Union has presented a paper on 'Wal-Mart's Global Track Record and the implication for FDI in multi-brand retail'.

"The paper dwells on the business practices of Wal-Mart in some countries and concludes that without adequate safeguards put in place, FDI in multi-brand retail will lead to widespread displacement and poor treatment of Indian workers in retail, logistics, agriculture and manufacturing," he said.

The US-based world's largest retailer Wal-Mart has already established its presence in the Indian market through a wholesale cash and carry stores.

It is among several other global chains waiting for implementation of the government decision to permit 51 per cent foreign direct investment (FDI) in multi-brand retail.

The Cabinet decision of November 24, 2011 could not be implemented in the face of strong opposition from UPA ally Trinamool Congress and several state governments.

Scindia also said that 11 states and union territories have conveyed their support to the Centre for opening the sector to foreign investment.

In an another reply, Scindia said that a writ petition has been filed by Vandana Shiva, an NGO activist, in the Delhi High Court alleging that Bharti Wal-Mart and Bharti Retail are directly and indirectly carrying out retail trading in multi-brand in violation of the FDI policy.

"The matter is sub-judice," the minister said. Bharti Wal-Mart is a 50:50 joint venture between Wal-Mart Stores Inc and Bharti Enterprises that operates wholesale stores in India.

The company currently operates 17 wholesale cash-and- carry stores under Best Price Modern Wholesale stores in India.

Further, Economic Times published an eye opening report today and it proves my point very well.Just see:
Multinational companies in India have delivered higher returns across sectors such as FMCG, pharmaceutical, automobile ancillaries and capital goods over the last three years compared with their Indian peers, riding on the back of superior technology, products and brand equity.

The Indian units of global consumer goods firms such as Hindustan Unilever, Nestle and Colgate-Palmolive have posted returns of over 95%, 110% and 150%, respectively, on an average during the last three years, more than double the 35-42% returns reported by Indian companies such as Dabur and Godrej Consumer.

Similarly, pharmaceutical companies GSK Pharma and Abbott India have outpaced local drugmakers such as Cipla and Sun Pharma with an average return on investment of 41% over three years. Contrast that with the return on investment of less than 25% over a threeyear period for Cipla and Sun Pharma, which is the most valuable Indian pharma company.

The CNX MNC Nifty, which tracks the performance of MNC companies, has given returns of 45% during the last three years compared with returns of 19% of Indian companies.

Strong Branding Helps

"Stronger brand equity, unmatched technology and products, stable earnings, strong balance sheets and parentage are the main reasons for this out-performance." says a senior fund manager on the condition of anonymity.

Hardik Shah, senior analyst with broking firm, KR Choksey says foreign companies have better competency with a clear leadership in several categories.

"Foreign companies have a global brand advantage built over years, which Indian companies have to compete with," he says.

He may well be right. For instance, Jockey's strong branding has helped Page Industries, which owns the brand, to eat into the market share of local brands. Jockey's sales have risen at a compounded annual growth rate of 38% over the last five years while sales of Maxwell Industries, owner of the VIP brand, have remained almost flat.

And it is not just consumercentric firms that have done well.

Automotive supplier Bosch possesses technology that hardly any other company in the world has been able to match. Ditto for Oracle Financial Services. This is visible in the operating margins of these companies.

Oracle Financial Services' operating margin is around 40% compared with 30% for its Indian peers such as Infosys, TCS and Wipro.

In the capital goods sector, Cummins India has fared way better than local firms. Its three-year average return on equity is 31% compared with 22% for its Indian peer, Greaves Cotton.

What also stands out is the fact that not only have these companies generated better returns on investment, but also sport strong balance sheets and better cash flows. In the auto sector, Maruti Suzuki has virtually no debt while Indian automakers such as Tata Motors and Mahindra have a debt to equity ratio of around 0.9 and 0.7, respectively.

As for smaller retail companies, Bata India has zero debt compared with other footwear companies such as Relaxo Footwear and Liberty Shoes, which have a debt to equity ratio of 1.4 and 0.9, respectively.

Most multinational firms are also high dividend payers. Companies such as Castrol, Colgate, Nestle and Bosch have one of the highest payout ratios. Castrol paid out 88% of its earnings last fiscal. http://economictimes.indiatimes.com/news/news-by-company/corporate-trends/Multinational-companies-in-India-like-Hindustan-Unilever-Nestle-beat-local-peers-across-diverse-sectors/articleshow/15592949.cms


In the six-point response, which he is unable to present in Parliament due to the stalemate caused by the Opposition, the Prime Minister would be underlining that the coal blocks were allocated in a transparent and appropriate manner through checks and balances without any favour to any company.

The thrust of the Prime Minister's response is that Chhattisgarh, West Bengal, Rajasthan, Odisha and Jharkhand, all ruled by non-UPA governments, had opposed in 2005 the Centre's move to bring a legislation on auction process, sources said.

He holds the opposition by these states responsible for the delay in introduction of competitive bidding for allocation of coal blocks "as a new concept was being contemplated requiring changes in relevant laws as well as building consensus despite opposition to the proposal from different stakeholders, states and ministries."

The law for auction bidding is now in place. The delay in coal block allocation was one of the charges made by the CAG.

The Prime Minister had yesterday said that he "can give satisfactory answers to all issues being raised."

Contesting the CAG's contention that private firms gained to the tune of Rs 1.85 lakh crore in coal block allocation between 2005 and 2009, Singh's assertion is that it reflects "inaccuracies" in the report.

The Prime Minister's point is that the CAG has computed on the basis of allocation of 57 mines but out of these, 31 coal blocks belong to the period prior to 2006.

He also says the amount of loss projected by CAG was "misleading" as calculations had been done on the basis of Coal India prices and private players have different cost parameters.

Meanwhile,The United Forum of Bank Unions, which heads all nine bank employees and officers unions, said the strike had been called to oppose reforms that could ease mergers rules and allow more private capital into the sector.

It was not immediately possible to assess the financial losses due to the strike, though trading volumes in government bonds were thin at 23.6 billion rupees as against the average 40-50 billion rupees in the first hour of trade.

SBI halted trading in onshore spot foreign exchange markets as its settlement operations' staff did not show up for work, sources said.

Bank branches were shut in many cities were shut as thousands of employees, many brandishing banners, shouted slogans against the proposed reforms.

"Unless the government relents or the government gives some positive response, we are going to intensify our agitation," said J.P. Sharma, vice president of the All India Bank Employees Association.

Many public sector banks in Connaught Place, the commercial hub of the capital, New Delhi, saw only two or three employees trickle in for work early on Wednesday, while many joined their colleagues outside the branches.

"Both sides suffer. The public is inconvenienced and we also lose our daily clients," said Shashi Sharma, chief manager of state-run Punjab National Bank (PNBK.NS) as he sat in a dimly lit and vacant office.

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