Dollar woes

The dollar has become the most sought after currency post the October carnage we've seen in the equity markets. A slap on the face to those who suddenly felt that the Euro would replace the Dollar as the world's benchmark currency. I always wondered when did the currency that ultimately influences the value of the Euro become it's poor cousin.

The stories about $ weakness came about post lot of news of Crude being traded in Euro by Iran supposedly the 4th largest reserves. And then others that sought to trade only in Euros when as fears of US making a mess of a larger mess.

There is another theory that is doing the rounds in some quarters is the lack of dollar credit domestically and its direct impact on impeding growth. In effect these arguments are put forward by self styled/proclaimed Nobel Laureates.

Yup Ratan Tata has gone on record that raising funds globally has become tough. This is not something specific to the dollar but credit as a whole abroad including India. Also credit growth for October is 29% as reported by TT Ram mohan. And by all published Data credit growth has been increasing and increasing quit sharply.

One always read credit growth figures for last year to be in the range of 22-25%. For the month of October which saw the worst carnage in Indian markets that was attributed to lack of fundamentals, credit crunch etc. how does credit growth remain so high?

I remember KV Kamath in 2006-7 screaming that interest rates must go down as there is no credit off take. Dickhead just tell it bluntly that you wanted the world to borrow more and have a better yield on your advances. There is demand for credit today but you real scared to fund it. And if what are you funding? Credit to buy more dollar to be put abroad?? And are you consicoulsy funding it towards factors the contribute to economic growth?

And then there are those who believe that the reason for the slowdown in the economy is because his Standard Chartered banker/friend told him that there is no "dollar credit". When did HLL or Maruti fund its domestic working capital requirement or expansion plans using dollar credit?

Oh yes the Big infrastructure companies have been raising funds abroad, given the interest rate differential last year. But I thought several restrictions were placed on ECBs as the rupee went into the upward spiral last year. So credit off take at the corporate end was only restricted to funding from abroad in dollars and domestically its was us Indians whose credit requirements funded the real estate boom. So that explains the Credit growth figures Huh???

Suddenly its sounds as if Dollars was the chosen currency for credit off take. What ever happened to the good old rupee...

I obviously ain't denying the impact of dollar shortage and its impact on credit. But to say that dollar credit not being available and therefore projects domestically are not being funded is utter stupidity.

I thought there is a shortage of rupee funding: The logic-- RBI has been buying the rupee aggressively post the FII sell off to support the rupee from depreciating further. Therefore the central banker has been absorbing huge amounts of rupees from the system as hedge funds and Hot money flew away. So rupee has suddenly become tight which obviously then impacts credit off take domestically.

The other obvious indirect impact was the Dollar shortage globally. Again not the need for dollar credit but just the asset(if one could still call it). The problem was two fold. One where domestic banks had to buy dollars from the central banks to replenish the shortage and their working capital/reserve requirements abroad. Second is where Corporates that could not meet working capital requirements and various ambitious expansion plans because of the dollar shortage abroad. And there is also enough talk about how various forex products sold again by these "fresher MBA-I know it all types" which probably have fuelled the need for more of the greenback to fund their off balance sheet items.

Knee-Jerk Reactions

It's been 3 days since the bloody siege. And now the usual analysis of what should be done with Pakistan, what should be done with our politicians, why did the NSG come in BEST buses et al.

I mean for Christ's sake let not your Allegiance to the nation be defined by sending stupid chain mails about " Letter to Prime Minister" and send this to every Indian. How did nationhood and the love of it revolve around how many Indians you send a very poorly written letter. For Christ sake there is anger. Each one burns from within to see the helplessness the state is in. But these stupid chain mails don't help and don't elucidate any constructive action. Wanted to ask the dude authored the letter as to when was the last time he celebrated heros such as Satyendra dubey and Manjunath. Also to ask those who like duds kept forwarding it?

There was another stupid logic about why NSG was made available the services of BEST v/s Cricketers being sent in luxury air conditioned buses. "Send this to every Indian" sort of crap.

There is an obvious logic of not sending troops in luxury buses that are not air conditioned. Your body is supposed to be accustomed to the outside environment. Haven't you felt slightly dizzy when you come out of cold room into the blazing sun. Its the body stupid. Worldover Aromured vechiles are desinged to endure hostile envrionments. Unlike cricketers NSG doesn't have the luxury of a warm up session. NSG and their kin worldwide are trained to manage hostile environment. Yup we feel dam proud to see these guys coming out of Neeta bus service. Do you guys even know the names of anyone of those heroes? Neither did I. I bet most didn't know who Jyoti Krishna was. So much attention We've paid uh for the supreme force. And so much for being Indian.

I mean guys the right reaction would be "dedicated buses and not makeshift ones".

Shobha Aunty said on TV" My god, we don't have water pressure to reach the 6th floor of taj. Aunty I guess your angst is as funny as Aish's dresses. Water pressure has its limitations. Its the equipemnt used along that ensure (ladders,cranes etc.) that are essential

Another foolish thought is to send some 25 people and do the same dastardly act. Send spies into enemy territory. You joker, don't you realise that it's already in place? as in the intelligence apparatus. It's efficiency maybe in question but again that cannot be assesed. Is the govt. to make a public announcement that we have spies in xyz country? There is enough info put by the media about prior knowledge about a possible attack. So yes the buck lies with administrators who reflect a careless lackadaisical attitude towards security. Which I must say is nothing but a reflection of society. The common man as well has displayed his quota of insensitivity's towards internal security.
And then we have reactions that all politicians should be shot down. Dude I thought we elect them. Its the posh areas of Delhi, the rich, the elite is where from Manmohan Singh fought an election. But the obvious apathy towards polity ain't doing any good.

The only reason the rich elite don't vote is cause the quality of politics doesn't matter. Its not them that bear the brutal train rides or the long bus journey's in the summer. Its always been that the privileged section to been the last to react and probably the most passive.

Every country deserves the politicians they get. This is Democracy. I'm sure these everyone wants a Chinese style governance where some magic wand would cure all our ills. I bet every drop of blood in my body that each one of us would desist it.

Then we have "Carpet Bomb Pakistan". Dude they are a Rouge nation. A govt. likes our whose in control of nothing. Unfortunately a nuclear power. It takes one idiot to call the wrong shots probably end the last war the world will ever see.

Impotent rage: Honestly candle lights, standing/marching for solidarity.... I'mt not sure how much it works. We are a country of protests and these protests have never worked. These maybe be great symbols to communicate affection but unfortunately lead to no action. I 'm not being cynical. But wouldn't a quick check to the blood bank be more useful? We all want action but from whom? People who called Major Unnikrishnan's house not worth being look by a dog?

Tackling Terror

kk,
My response to your write up.

Are you saying that the present laws suffice in tackling terror and it's only the lack of implementation thereof that has led to this mess?

Oh yes we are to blame for being passive and insensitive in the past. But irrespective of our cooperation and obedience to the law there are things that are essential to basic governance.
If a section of today's polity believes the current legal statute to deliver in various cases, it's only to cater to domestic political compulsions. Period

I'm sorry but the administration's attitude in dealing with terror cannot be looked into isolation i.e. along with its approach to ensuring basic internal security ,ensuring right laws are in place to speed up various judicial processes are also of relevance.

Take the ex. of MCOCA. It's foolish for us to believe that the present law suffices to deal with the menace that we see. Various cases have seen the day cause of provisions within the law. The train blasts case, the Bharat shah case where simple tapped conversations between the accused and underworld/terrorist elements are inadmissible in the present context which is not the case in MCOCA. The ability to secure more time in judicial custody et all contribute to overall quality of jurisprudence.

Take the malegaon case for instance. MCOCA is and was essential in ensuring a speedier investigation. Period.

Laws are required just as equipment if not more important than the bullet proof jackets we are all suddenly gunning for. Laws have helped. Its only when the selective application of it again to cater to "Not being tough on certain communities or being perceived as tough".

Again here the sincerity with which the law is applied is of utmost importance. I won't deny the tendancy of it being used against the weaker sections.

I ai'nt targetting any community. Remember its the hindutva brigade that filed PIL's against the application of MCOCA on the Malegaon blast accused. Its the same law that was applied to speedy disposition of justice in the train blast case.

Assume you have an intercept of X person discussing a y act of terror and this intercept cannot be used to further investigation process cause the law doesn't enable them to do so. Surely that ain't helping the morale and neither does citizen obedience and cooperation with governance agents help.

But shouldn't law take its own course given the tough times we live. I am ready to give up certain luxuries that I enjoyed. Be it being frisked daily et al.

POTA rather poto (since it was an Act) is oft quoted as being anti-minority. Okay let me not mince words its accused of being Anti- Muslim. Remember under the law its not Muslims but a large no. of Naxalities against whom the law was applied. So much for it to be perceived as anti-minority.

I am again not going to drum the importance of law as it as well cannot work in isolation. Unfortunately the only way militancy has ever been contained is through the Gun. Punjab is an example of how through brute force and aggression militancy was contained. Force has worked. Flowers, gandhigiri don't work. You ain't fighting a civilised government.

Again here its the intention behind using the force that eventually decides the outcome.

If physical aggression is used as a means to avenge, it will never work. A tit-for-tat approach has never and will not work. If the intention is to ensure further acts of terror are not carried out v/s it being mere revenge seeking, the unfortunately the gun works.

The excesses whilst ensuring these acts and the use of force has it own consequences. Like Kashmir. Excesses have been committed. But what would we choice in the environment that we live in. The end of militancy at the cost of some but yes very precious lives or consistent acts of terror against the state.

Salaam Mumbai

What a week it was! A week that re-defined India's landscape on the global map and left scars deep in our minds. India will never be the same again. How ironic as I write this given that Mumbai was the hot spot for various cowardly Sena's to tell us who belonged to this city. A city that was torn apart on the basis of which state you belonged to. And now when we talk about the ghastly act perpetrated by the bastards of a perverted faith we don't talk about it as an attack on Mumbai but one on the Indian state.

Answers to "Why Mumbai was attacked?" are fairly simple and ubiquitous. Mumbai is India. It's been the melting pot of the country. It represents aspiration, hope, struggle, joy, culture above of a spirit iof resilience(will still defend it). Unlike northern cities such a New Delhi where the migration is from places such UP and Bihar or Kolkata where it would be the not so fortunate North east and people across the border, Mumbai has always had a potent mix of people from all over India. Be it Gujaratis marwadi's that dominate various businesses or the shetty's that occupy the reins to India's own fast food chains. Be it the sweat and blood of the labourers from the southern parts of India that build the dreams that we live in to the drivers that yes do ensure that we get home safely.

This city is India. Period. It represents what we are as a nation. The organised chaos of Mumbai's transport is reminiscent in the way India functions. Chaotic but still manages to scrape through. Here rains are enjoyed each year despite the havoc it brings in. Our gods are celebrated despite having failed to protect us. We still move on... Is that a good thing???

Yes. Lot has been made about the "Spirit of Mumbai" (cliche as it may be) and the passiveness its brought about that everything in this city will be endured. The spirit is important and has nothing to do with passiveness. Its also has nothing to do with inaction. They are mutually exclusive. Every city has a flavour that makes it what it is.

It's the strenght on which the city lives and moves. It's the oxygen towards hope of a better tomorrow, the fire burning in you despite all odds. To move on be it besides the lack of choice.

Yes I concede that the "spirit" has been made too much about but cannot be rendered as fodder to those who wish to do nothing. But its the same spirit when all else fails, seems to overcome our sorrows.

11/7 was a prime example, where people did take to the streets to help commuters, slum dwellers looking to rescue the faith of people who they have never known. Surely when the basic amenities fails you it boils down to its people and how they make the best of a bad situation. Its the spirit that pushes strangers to help each other when all hell breaks lose, In city where the infrastructure will short, governance will succumb to populist pressures and security is next to impossible.

Though yes a lot of it has been made as an excuse to bear the brunt of the that goes wrong with the city one cannot belittle its importance. It something which every city needs and I know only one city that has it. All be it shattered but still moving on....

Rupee Imapct on Inflation

Haven't you encountered those several individuals that assume they are the end and be all of all knowledge. Those who speak with utmost confidence whenever they are wrong cause it makes them feel important.

I once told a joker than since the currency had depreciated it made imports cheaper thereby reducing the prices of goods. Joker wasn't aware of this argument and neither has he even heard or read about. But is ready with a bizarre set of counter responses only to serve the purpose of " Yes I must know more than you" syndrome .

Love to ask these jokers the impact of fiscal deficit and the currency. Lets take debates to a higher level. Basic fact world over is the that whenever supply increases it impacts prices of goods i.e. it comes down. So its obvious that imports and cheaper as they get lead to higher supply of domestic goods thereby reducing inflation. Even if higher supply of goods is not the result that currency impact makes these import cheaper which is important for an import sensitive economy like India's. Cheaper goods imported means cheaper prices therefore lower inflation. Basic logic.

Ex: If I have Rs 200 and Crude cost Rs 50 per barrel, I buy 4 barrels. If the rupee appreciates to Rs 40 I buy 5 barrels. With the same amount of money I buy more goods. Apply the same logic to your daily purchases. If your income remains constant and prices of goods fall, it is cheaper. It only becomes expensive when the fall in your incomes is much greater than the fall in the prices of goods. Therefore if the appreciation of crude and other imports is way beyond the appreciation of the currency the impact is negated. Joker!

Dumb Freakin AAM Aadmi

The Headline inflation number has caught each one's attention. Political newbie pundits/analysts along with their economic counterparts have gone about beating the bush on how inflation has ruined their lives. Channels that have always succumbed to pressures of the market and that are part of an inextricable rat race are now singing the tone of the AAM Aadmi and how much he has to endure during this period of rising inflation.

Channels who've hired individuals that resemble the "MBA fresher types" (-- from 2nd and 3rd rung B-Schools who have no clue about Financial Planning, don't know anything about budgeting cause they themselves haven't been through that exercise, who have no clue about basic economics and have only heard about Mutual Funds post their internship and to whom inflation means reduced expenditure in CCD) who seem to conveniently chose socialism over market economics are now presenting stories about how the poor cut down on their meals and prices of goods have risen.

The typical stories that have made headlines are the poor slum dweller, village labour,sweeper , the usual middle-low income groups that constitute the voting populous.

You Dumb AAM Aadmi, are you telling me that a person who lives on ration like Tur dal and basic rice, wheat, fertilizer(all of which is subsidised) is actually consuming less of all of it cause the steel prices have rocketed and have made cars more expensive??? Is this person bearing the brunt of increased fuel prices when Govt. transportation facilities have not increased their prices???? Is that stupid housewife that bothers about her household budget cause LPG prices have shot up by less than Rs 2 per day (Increase from rs300 to rs350 per month per cylinder) relevant at all when the fact is that the middle class has had the going very good for the past 3 years??????

Lets get fact clear. The stories of Sweepers and daily wage earner eating less is stupid cause of two reasons.
1. These stories have come post WPI increasing drastically.
2. The prices of food articles have not shot through the roof and has come down in most cases.

SO you dumb MBA whose hired for smooth talk and a Bigger Ass get certain facts right.

1. Food Articles constitute 15% of WPI in which prices of pulses are down approx. 11% and cereals are up 5% which is nominal
2. Prices of vegetables are up 7.7 YoY but down 30% since Sept last yr.
3. Prices of fruits have remain the same over the past one year. Probably only the fresher MBA has started consuming less in the quest to look better.

All this gyan was taken from the Index Components. Go to you normal shop and check about the prices of goods and invariably your household budget would remain the same or nominally increase.

Yup the sweepers has started consuming Imported and premium variants of basmati rice and the shortage of its supply has driven up prices. Yeah Right!!

The sharp rise in prices is attributed largely to the metals index given the soaring commodity prices we've seen in the past one yr. other than just oil. Metals price have shot through the roof cause the sweeper has started using broomsticks made of platinum and bought gold chappals to whack its politicians in the impending elections. Surely consumers are having steel noodles for breakfast and Iron dosas for dinner and the steel/iron price hikes are affecting them.

The other logic of trickle down effect....oil affects other commodity prices et al.... then why haven't vegetable prices Host through the roof. "Hey Dude, you know what, my plane ticket just got way too expensive- inflation impact you see"

When did Airplanes become the mode of transport for the Aam Adami? 90 million travel domestically and 3% of India has passports so 3 % of international travel. There is a good %age of this travel being covered by Corporates.(employee audacity)


Given that most of India lives in a subsidised environment and have still not been benefited by the reform process it's foolish that inflation has impacted him. It luck in a sense that inflation has hit largely a privileged section whose voices are generally heard through the media which has the audacity to state that things are getting worse for all when it's restricted to a small privileged section given how large we are.

An Obession called Modi

Brand Modi was elected. Gujarat's Election wasn't a contest between the congress and the BJP but about Modi and the only choice left with the voter was Modi and his brand of politics.

I have been a staunch supporter of the BJP. But leaving my bias towards the party aside I have never been a supporter of his brand of politics. Although would admit my views on him have changed over a period.

To begin with lets look at the criticisms
1. Modi has Polarised Societies.
2. Modi is Dictatorial
3. Modi is Prejudicial and intolerant.


1. Modi polarised Societies : The English media conveniently chooses to ignore the politics practised by Samajwadi Party when it comes to communal politics. I am not aware or any action taken against the minister who made the infamous remark about beheading the danish cartoonist.

Nor have I come across vociferous and consistent criticism of the brand of politics of the BSP by the so called secularist English Media, to which Modi has been a recipient.

I don't think one can quantify and dare comment between two riots in terms of which was more gruesome. Both require the same yardstick that is to be applied in terms of consequences in order to ensure the (resorting to a cliche) perpetrators don't go Scot free.


Sikh riots on most accounts I've read were heinous and ghastly. Its been 23 years since the riots and most eye witness accounts point out to the Congress being solely responsible for the hate crime. Yet do we know of any individual booked for the crime and do we feel satisfied of the fact the many young Sikhs were slaughtered and burnt and families are still waiting for justice. For a crime where by all accounts was on part of the congress(Tytler) to avenge for what had happened to Indira Gandhi.

And Dear miss Sonia Gandhi, who called Modi Merchants of death. Cud'ya please tell me which tree broke and shook the Earth? "Kill them, they have killed our mother" is just a figment of my imagination.

2. Modi is Dictatorial

Time and again I've heard the doyens of Indian Business, the likes of NRN say that we need leaders who would not indulge in appeasement and take decisions that aren't popular/populist and need to have a steely resolve to combat. Modi have put those involved in power theft behind bars and appropriate action taken against those who impede development. In a country where most politicians believe in giving free power as an election ploy(given that free power leads to more wastage of resources and does not necessarily help agriculture as a long term solution) Modi has gone against what would not be a popular measure from an election point of view. Unlike other politicians he hasn't given into foolish election ploys at least in this case and has not held development hostage to "visible popular measures".

3. Modi is Prejudicial and intolerant

We would love to single out Modi and use him as a poster boy for whatever is wrong with as a an intolerant society. I am not justifying one act because of the several acts committed by others. But don't see the same harshness in tone while condemning others.

I ain't a great fan of Modi and he was liable in not reining in required elements. But it somehow blinds our judgement and we end up making bizarre comments how The Ratan tata's of the world who stand with him in the same podium without knowing that Ratan Tata hasn't invested or chooses to tie-up with Modi but sees Gujarat as a great Investment Destination. Modi may go tomorrow but Tata's plant will be there irrespective of Modi's Fate.

His irrigation programs have worked and are appreciated. Power is available in all villages. Friends from Gujarat tell me that most farmers and rural households have power supply and Gujarat is one of India's fastest growing states.

Yes he needs to be made accountable for the rights. That doesn't take away the fact that he is irrefutably incorruptible and an efficient administrator

Hang till Death!

"Rapist's should be publicly executed. Their bodies should be chared, mutilated. Their bodies should be grinded and each part should be destoryed and people at large must be made aware of the consequences of Rape. "

A usual reaction to a crime like Rape. To me the crime sends shivers down my spine. But would love to know what on earth could blind one's judgement and his/her response to the crime as an adequate measure to reform society and influence crime and its existence.

Yeah right!!! For a person who is heavily intoxicated, the image of a person's heart hanging from the branches of tree and his chared body is something that would strike whilst forceful sexual intercourse. It baffles me why individuals like you and me react and find that justice would be served through such barbaric means.

Am I undermining the crime and its impact. No. Period. But for christ's sake dont equate rape as a crime, no matter what the events, commensurate to capital punishment.

Oh yes! Rape is brutal, far more brutal than murder where an Individual is forced to live with the scars till eternity. It's a crime where mind you the death of the victim would do no justice in assuaging the pain that an unfortunate person has gone through.

Oh c'mon, u tellin me that the victim would feel much better if the perpetrators will be hung. Are you sure that the scars are not so deep and the pain and anguish that a victim undergoes would be assuaged by the hanging of a person?? What Crap!

Irrespective of rape, capital punishment needs to be awarded to crimes in terms of how heinous,odious, attrocious, abhorrent,flagrant a crime is. That means look into the nature of crime and please do not classify every act of rape as a crime commensurate to Capital punishment and comments like " His body should be grinded into pieces and be displayed to he public" is compeletly unwarranted.

Take this instance. A couple, who through mutual concent have a period of sexual intercourse. One fine day, a woman objects, but unfortunately she is forced into sexual intercourse. Should the person, the man be executed? Shouldn't one look into the gravity of the offense. Oh yes the person needs to be punished. But wouldn't we distingusih it from a person who would otherwise beat, intoxicate a woman and force her into sexual intercourse. Should be blindly award capital punishment to a forced sexual intercourse, irrespective of the nature of crime and therefore classify every act of rape as henious as intoxicating a woman and beating her up?


The main and only reason why capital punishment doesnt work is cause one's ability or his belief that he would get away from the law. Period. The quantity of punishment has nothing to do with restricting crime. It's the effectiveness and efficiency through convictions are what which eventually act as a deterent and not the punishment.

Politician's son being involved, Children of powerful businessmen, if are at any point involved in such heinous crime's like rape, its not capital punishment that would act as a deterent. Their arrogance is bred on the fact that they would escape conviction. Period. U may have capital punishment, public mutilation, its not gonna impact the rich and powerful when it comes to restricting crime cause eventually its doesnt matter when one subverts the system. Which is the main issue at stake.

So in a nutshell reserve Capital punishment to the rarest of rare crime and the nature of crime. And not just cause it's rape. If conviction remains poor no capital punishment would serve its purpose.

Cause in the end the objective of any Judiciary is not only to deliver justice to the victims but for it to deter crime. That's why we govern states. That's why we employ our faith in the Judiciary. There's no point punishing an individual if it doesn't serve the purpose of detering a crime.

Kabul Express***

Kabul Express ***

I am tempted to give 4 stars.
If ur one of those for whom beauty and cinematic brillance is confined to chiffon clad sarees at the snow capped mountain ranges and dance/romnance sequences along serene lakes which is usual to A Yash Chopra Production chances are u might not like this one.

On the other hand if u love rocky deserts and find barren landscapes with war torn buildings, dilapidated structures and eerie locations something to relish, then this movie offers plenty of it.

Probably the best Yash Raj film after Dhoom. And thanks to a discerning audience and the multiplexes brillant directors like Kabir Khan get some space to tell a story and spectaculary shot. Oh!! just brillant!! in the way the movie is shot. Photography,cinematography,sound, amazing background score et al are amazing.

Why not 4 stars? Cause at points I thought the story was forced on you and it needed more of the political element in it, instead, the movie at most points is trying to tell the story thru the people's expriences. Things such as Opium trade and the Soviets I thought should have been highlighted.....

Neverthless a brillant film! Kudos to Yash raj and yeah if ur among those u dont enjoy international politics and war torn stories and need the masala element then let this one pass. It's not ur usual blockbuster but a brillantly shot and narrated film.

FDI or FII??

Last year, foreign institutional investors pumped to India a record $8.5 billion, a figure that made India the third largest recipient of FII money in the world in 2004.In contrast, FDI flows have remained stuck in the $3-4 billion groove for the past many years. India attracts about one-fourth of the world’s portfolio flows and barely 3 per cent of the world’s FDI. It’s just the reverse in China. FDI is in the range of $50 billion, while portfolio flows are much lower, in the range of $4-5 billion. The question arises: why the foreigner looking at India’s stock markets is far more excited than the company looking at building factories in the country? There are, of course, differences, between FDI and the other flows. FDI is problematic for foreign investors because it means bringing into a country managerial capacity and organisation. In contrast, FII is easy. Only money needs to be invested for earning returns. No effort is required to build organisational capacity for operating in that market. But if a country does not have a well-developed stock market, foreign investment has limited choices. In the well-developed markets of Europe, for instance, the share of FII in total capital flows is high. In contrast, in the countries of Africa, FDI is the dominant form of foreign investment flows. However, too many investors do not want to venture into poor countries so the total foreign private inflows are small.
Today, it is relatively effortless for a foreign institutional investor (FII) to enter the capital market. A Sebi registration, preceded by a fairly perfunctory due diligence, is all it takes before an FII can enter the Indian stock market and commence trading. Exit is equally simple. For FDI, however, both entry and exit are far more difficult. Even in sectors opened to FDI on paper, problems remain at the grassroots. There are innumerable clearances that need to be obtained at the state and district levels. There are also a number of practical hurdles, such as infrastructure bottlenecks, all of which make entry difficult. Exit is more complicated. Archaic labour laws, such as the Industrial Disputes Act, prohibit the closure of any company employing more than 100 workers without obtaining prior state government permission. Bankruptcy laws are convoluted and legal processes costly and long-winded. The Common Minimum Programme of the central government stresses Foreign Direct Investment over Foreign Institutional Investment. Its position is that "FDI will continue to be encouraged and actively sought, particularly in areas of infrastructure, high technology and exports and where local assets are created on a significant scale. The country needs and can easily absorb at least two to three times the present level of FDI inflows," after which the document hurries to add that "Indian industry will be given every support to become productive and competitive" and that all efforts will be made to provide a level playing field. The position of the Common Minimum Programme on FII inflows is spelt out. The FIIs, too, the CMP says, "will continue to be encouraged," but immediately thereafter goes on to state, in the very same sentence that "the vulnerability of the financial system to the flow of speculative capital will be reduced."
Very often arguments are made that this is not good. Instead of having so much portfolio investment, India should have been attracting more FDI. It’s argued that FDI boosts the investment rate directly whereas remittances and FII inflows would be transfers, only a portion of which translates into savings and investment. However, in terms of the impact on balance of payments or the interest rate, it is the totality of inflows a country is able to attract that matters, not its composition. Research suggests that attracting FII may be a sign of good health and attracting FDI, a sign of bad health for the economy. In contrast to the commonly held unfavourable view of FII flows, evidence suggests that countries with good institutions and markets attract more FII, while countries with poor laws and institutions attract more FDI. In the poor countries of Africa, often the share that goes into the primary and extraction sector — such as mining and oil — is high. In rich OECD countries the share of FDI in total capital flows is low at barely 12 per cent. As countries develop, the total capital flowing to them goes up with the increase in per capita income. However, the share of FDI in it goes down. Foreigners learn to trust their markets and institutions and do not feel the need to go there physically to earn returns. That is why economists in Latin America have been getting concerned about the rise in the share of FDI in total flows. The share of portfolio investment has collapsed and this is seen to be a loss of confidence in their markets and institutions.
India should not be embarrassed about attracting portfolio flows. This in fact reflects its success in building sound companies and a well-designed equity market. It is a sign of good health. There two basic reasons why FDI is preferred to portfolio investment. First, it is believed that FDI will stay in India in the event of a currency crisis and, second, it is believed that FDI has a greater impact on growth. FDI is considered “bolted down” as it involves investment in physical plants and equipment and these are very hard to get rid of. Studies of currency crisis usually compare the stability of FDI with that of debt, particularly short-term debt, and in comparison, FDI has been found to be more stable. But that does not mean that FDI cannot move. Latin American economist, Ricardo Hausmann, has argued that there are important mistakes that flow from problems of measurement. In a country’s balance of payments, FDI flows are defined as the increase in the equity position of a non-resident owner who holds more than 10 per cent of the shares of a firm. It also includes the loans received by a local company from the parent owner. About 20 per cent of FDI takes the form of loans from the parent company. Moreover, since the firm is merely a set of assets that are “owned” — in other words, financed — by creditors and shareholders, we must not think of FDI as the firm and its assets. Instead, it is just one of the sources of financing for the firm. FDI is not bolted down, machines are. At the time of a crisis, the foreign company can either sell its equity or take a loan against physical assets and take money out of the country.
Economists Graham Bird and Ramkishen Rajen have shown that despite the fact Malaysia attracts huge FDI, there was a currency crisis. The argument that FDI raises the growth rate of a country is also not watertight. FDI is not found to raise growth when it goes into the primary sector. The impact is ambiguous in the case of services. When it comes to manufacturing, FDI raises growth. But, here again, growth can remain limited to the specific industry in which the FDI went. Worse, it may even remain limited to the firms with FDI. The spill-over effects of technology, management and corporate governance that is often expected to accompany FDI is not automatic. The growth impact of FDI is thus not automatic. It is only countries that have good institutions, skilled labour, openness to trade and well-developed financial markets that gain from FDI. In the absence of these, even if a country attracts FDI, its usefulness is limited. So, instead of trying to be bullish on FDI flows, and restrict FII flows artificially, India must focus on improving markets, institutions and the regulatory framework to encourage foreign investment. Policies should focus on creating a clutter-free market and world-class infrastructure.
This is Article sourced

To hang or not to Hang..........

Afzal... The name arouses extreme reactions. One of hatred for facilitating a crime against the Indian State. One that draws compassion for he is'nt the crux of the issue. One that draws all of us into a new debate where we question whether his death penalty should be commuted to a life sentence.

My take: It's a simple issue made complex by those who disagree with the punishment meted out. There's is no denying that Afzal has been convicted/guilty of a crime he commited. Indulging in arguments in order to prove his innocence amounts to blasphemy. The supreme Court has found him guilty. And questioning the credibility of the judgement by those seeking clemency on the grounds that he is innocence is foolish. As it's the same court that let off SAR Geelani.

So please dont stick to a position that the Supreme court got it wrong in the case of Afzal as aquiting him should draw the same arguments. Dont stick to positions where u reason's his innocence on the grounds that the Court's could have got it wrong, just cause it's convenient to your argument that Capital punishment is'nt appropriate.

So lets keep the two issues seperate. One is whether his guilt/crime Commensurates with capital punishment and the second one of clemency i.e. whether he should be executed.......

Those seeking his clemency argue that he should not be hanged on the grounds that he was only a facilitator. What Crap!!! Osama didn't fly the plane to 9/11 so he is'nt guilty. Just cause I sell a product that illegal(drugs et al) and dont consume it, I should be pardoned as the choice is with the person who consumes it. Afzal is guilty and a crime that grave and in no small measure, of a crime against India's biggest symbol of Democracy, Its parliament.

So dont find reasons just cause you do not agree if death/capital punishment isn't appropriate.

Now the question of clemency. Arguments are that Kashmir will go up in flames. Wouldn't Gujrat go in flames??? Wouldn't the North East go up in Flames??? Oh C'mon! Let's be honest. The issue would have wider implications than Kashmir.

If the Court has sentenced Afzal, its cause its the law of the Land. And please stick with it! Dont Complicate issues and mix it with the pros and cons of Capital Punishment.

Clemency should be granted on grounds of age, family..... compassionate grounds and please kep the gravity of the crime always whilst arriving at any decision. Soli Sorabjee has consistently remarked that granting him Clemency would set a bad precedent. A bias towards a certain section. I am sure that if Kasmir wouldn't go up in flames other states would. And what's the assurance that ist wouldn't happen otherwise. Should we hold the courts to ransom cause a certain state would go up in flames. It's not about Kasmir but other states as well that would go up in flames or very well would use it as a excuse.

I do not support Capital Punishment. But that's a different argument. And has Afzal been punished or sentenced appropriately for a crime he has committed?? Yes, so please go by what the law of the land say's and please do not set a bad precedent. Period.

Spare the GODS!

M.F. Hussain, a revered artist, adored by auctioneers, worshipped by peers, exalted by the rich and now condemned courtesy intolerance and now forced into exile.


A debate that brings forth the thin line between artistic freedom and religious/nationalistic tolerance.

His paintings have captured hindu goddesses in the nude. The one on the left invited more trouble from the Home ministry. A ministry that claims to be part of the govt. or rather brands itself as secular and tolerant govt. and wears its shades of religious tolerance with fervour.



I wondered whats all the fuss about his paintings and the one above which depicts the map of India in the form a nude woman is something, if u ask me hardly offensive by any figment of my imgination. Now heres a certain section of the media and other right wing activists that have labelled him to have committed a crime that amounts to rs 11 lakhs for his hands being chopped off and rs 51 cr. for beheading the Danish Cartoonist.

The painting on this link is guess what??? Sita nude on the tail of Hanuman. Oh c'com, If I hadn't told u this, one would never interpret what's the painting all about(assuming its the first time u've seen it. There is nothing offensive, erotic in the paintings and find no reason for one to cry foul. Is ur religion/faith belief so fragile so as to be so intolerant by some crap painting!!!

Oh yes I dont understand art. Neither Do I Intend to. I cant understand what does a stupid solitary black dot on a huge what canvas signify.... To me it's just sheer waste of paper and time, Given the fact the some freaks spend time interpreting the crap and forcing some sense out of it.

Having said all of this and having always been alergic to be associate to any religion or faith as my guiding light I support the arguments against the painting. Not being specific to the one uploaded but mere intention of one to present what otherwise would be considered sacred.

I, in noways support the response by a section of intolerant goons, but oh c'mon what artistic freedom has one denied u if ur paintings are in danger of objecting popular sensibilities. I have no problems with the painting neither the intentions but for christ's sake please respect one sensibilities. Even though I dont approve of one's belief that the deities should be spared, if its against popular belief and the very nature of how contenious a debate of religion is, please respect it.

Some may retort that u could boycott his painting by stating his objection. Oh yes convenient reason for why I cant dont buy M.F. Hussain. I dont buy it cause I object to his paintings..... not of the fact that his painiting cost rs 1 crore. Small change for me and what a wise way to object....

U paint me nude, and yeah I object by not buying it. I am sure that's not gonna happen cause then no one would but it, spare the connoisseors of fine art. So everybody objects...

My parents have a problem. They do not appreciate and object to people whom they consider sacred to be painted nude. People/deities/gods who they have revered over time to be painted nude under the garb of artistic freedom. They are not gonna change through educating one on how curbing freedom would affect us as a Democracy. They have a problem and felt offended. I do not endorse their(my parents) view. But I respect the reasons for which the are offended. And please respect it. Period.!!! They aren't resorting to violence and neither do they buy your paintings, so will somebody please stand up and tell me, how do they register a protest???


I do not endorse the reaction towards the painting but why try and ignite and thread territories that for many is sacred. The absence of a protest or those who do not voice their opinion does not amount to one not being offended. But for christ's sake spare the Gods!

Should we allow FDI in retail

Our retail sector is worth $180bn and only 3% of it is organized.


Benefits of retail
1. Better Procurement
2. Efficiency in the Supply of goods--better prices
3. Competition - Domestic players have to compete- again better prices4. Exports- The most Impt. one.


Walmart is half our country's GDP (if u takes GDP as $770 billion) and that's just one co. The point about our retail sector (worth $180 bn) and Wal-Mart’s Sales is invalid. Why?



1. The price of an avg. item in the U.S. cause of PPP would generally be higher than what it is here.
2. Even if the volume of trade is higher or avg spending per household as a %age of spending is higher the anomaly of the high sales figure would still rise cause again of the PPP argument.

Economies have to move/change and a transition is inevitable. The argument of the Kirana shop closing down and local players bearing the brunt the most at least to me, today, would be misplaced.

In India FDI is almost synonymous with Wal-Mart. And again we are told that it would create and unfair environment. In the following write up let’s contest those arguments.

The argument of a co. by its sheer size would/should hamper our economy--retail model in specific, is a misplaced argument. Unless policy issues are not in place. I'll further elucidate.

"Our total retail sector is worth $180bn where as the sales of WAL MART this year is $315.654bn. No no.... we can’t compete with them"

Yes, the Wal-Mart’s with their might would exercise a better bargaining power like you mentioned. But here again what I am contesting is that taking the annual sales of Wal-Mart which procures in large amounts from China, the cost of which again on a PPP basis would be much lower and the sales of which would be much higher on a PPP basis in the U.S. and not necessarily in terms of the actual value of goods, which means that the revenues would be inflated. With all their might Wal-Mart would have to sell at prices prevailing here and adjust costs/revenue structures to what's best suited here.

From another source"It is interesting to note that the Left approach to the issue broadly follows the Chinese model. China first allowed FDI in retail in 1992. The initial FDI cap was 26 per cent. It took China 10 years to raise the limit to 49 per cent. The 100 per cent foreign-owned retail stores were allowed only from 2004"

Instead of arguing for the domestic industry, and to give them a chance to compete, the more appropriate argument is give retailers a fair chance to compete. Period. Irrespective of foren on desi.

Remember the swadeshi arguments about don’t let the Phoren Players to enter our markets as Domestic Industry would perish.
Cause the Japanese would bring their machines (capital intensive processes) and the Americans would bring their computers(Technology) and since our economy till then was labour driven, so we would lose jobs and people would lose a source of income.

Remember arguments of -don’t bring the Pvt sector in agriculture as millions of farmers would be displaced because they would be rendered ineffective. But ironically Dairy and food processing and cold storage and areas that are left untouched this is where a lot of Pvt players see an opportunity.

To put it in terms of the lay person weren’t we told that the GM’s, the IBM's and Honda's of the world would capture our market and it would be the beginning of Imperialism.
Has it happened? Do you think we would have had a Pulsar, Ranbaxy , indica if it weren’t for compt.? Have the Infosys,Wipro, TCS perished under the onslaught of the IBM's and the Microsoft's?
Infosys Chairman, NRN has gone on record saying that the IBM's of the world only made them stronger. So we have a Pulsar which is sold in other BRIC economies, a scorpio which is sold in Mexico, a Indica which is sold in the UK, albeit under the Rover brand.

We end up mentioning the same arguments against FDI in retail.

Look at the Wal-Mart’s as a huge source of Exports like the Chinese have. Retailers source 60$ bln in terms of goods from China. Get them to invest in areas that have been left untouched. They would bring their proccess/practices and use it to you advantage. It would keep the domestic players in check.

There is no denying the FDI in retail is good. But the retails sector and how it benefits the mass at large is a function of good policy. The retail sector would go for a toss even if FDI wasn’t allowed. Then how beneficial it ends up being is a Function of a good policy irrespective of FDI or not.
Phew..........
Vineet

Sensex: Does it reflect anything?

Probably the one thing thats got every one curious in 2005. The word NFO or "Mutual Fund" may be something to which most of have subscribed to....

Since May 11 a new routine, reassuring friends and relatives about the markets and that their money is safe. The phone turns into an alert like the bell in the stock market, a sound which now is a sign of much more I would lose, begining of the carnage and relief @ 3 pm that the carnage has ended.

In all this carnage, porfolios being shaved, NAV's eroded one thing that emerged and was long overdue was the INEVITABLE CORRECTION. And honestly thing that the best thing that could have happened to the markets. Yes!!!!!!!!! its is best thing. Reason
1. The obvious valuation gap.
2. Unwinding of over leveraged postions.
3. The most imptr. , the fact that the Market has presented its full face and what it can offer.

Ever since the sensex which is nothing but a 30 stock index of the best and large cos in India(maybe a moot point), has got the retail investor to consider a shift to equities. Equities/Capital markets have got a face lift and their perception among amny has changed. People are ready to part with their savings and actually consider shares or Equities as an investment which years back would have been veiwed as nothing but an alternate avenue for people who gamble with their savings in stocks that are manipulated by a bunch greedy brokers residing at dalal street.

For a period between which the markets rallied from 6000 to 8000 and then back to 7500 retail investors(RI) have passive and engrosed in thoughts whether the market was a good place to invest also whether it was the right level to enter. And when 10,000 wasnt expensive there was a rush of investors some o my knowledge who even broke thjeir FD's to invest when ? not in an expensive market but when it peaked for the first time. Investors then took assurance of the markets when it then rallied to 12,000 when stocks like HLL were quoting @ 40 p/e!!!!!!!!!... The biggest stamp of assurance came from the Reliance Equity fund and collected a record rs 5700 cr. And then the Tsunami, similar in nature to the havoc it played, A word never heard before and never seen and everyone's caught off guard.. And all this led to the most unwarrented aspect about investing and I repeat investing (not trading)..

Coming back to my earlier point about why this is the best thing, Cause the retail investor is now convinced about the disclaimer which follows each MF ad. In this bloodbath there wasnt any scam, no Ketan,no Harshad or UBS. Just a playout of our markets being integrated globally and unwinding of positions which is part of every market.

Maybe Investors would now look at this as check whether they had invested cause they watched the sensex or whether the India Story was something they wanted to invest in. If it were the India story then its pretty clear that an Index @ 9000 levels and worst @ 12000 levels. No doubt the India stor is intact but expectations out equities need now be more on valuations rather than prices being misguided cause of liquidity be it domestically or the FII's.

Somehow Sensex like the Dow suffers from legacy. Reflective to many as a sign of the Indian Economy and every rise as a stamp of faith in the concept that health of the economy is reflected in a mere 30 stock index.

Celebrity Activism: Legitimate Cause or Convenient Mumblings

Should Celebrities endorse social causes? In the light of Amir Khan opining on the Narmada issue, another question or issue that has been brought to the forefront is the right of celebrities to align themselves with social causes.

Should Celebrity activisim be seen as a flash in the pan or as an instrument to move towards something more concrete in light of the larger social cause that they stand for. Is it a reflection of Social conscious or gaining a piece of media attn.

Celebrities endorsing causes that they wish to be identified with or conrtibute to, enjoy attention of the people . Breaking through the clutter celebrities exploit attention and bring issues and facts in normal discourse and in to the public domain. Issues which we conveniently forget. Celebrities enjoy attention. Period. Their voice reaches larger section, unfortunately more than those who have been championing respective causes for years. Theses issues have been brought to the forefront in the sense of the average person questioning whether enough is being done instead of being conveniently forgotten and kept in the backburner.

But given the priveldges that a celebrity enjoys one would expect his/her conduct to be responsible and consistent. Consistency would extend to not only their views but supporting the causes over a period of time ensuring that they are a part of public discourse by leveraging their status in society.

Critics often question the intent or the motive behind a stance, whether it is the media glare through which they wish to benefit from or whether the credibility of the person is appropriate towards the cause. Effectiveness of a endorsement towards a cause can be gauged only with time.

However the one criticism that is Valid is that when celebrities support causes the larger motive of bringing facts or sending across a message meant to invoke a response, is lost with a subtle view that the celebrity is a "good guy" and in this appreciation of the intentions of the celebrity that larger picture or motive of invoking response is lost. At times conversations about the issue surround the credibility of a certain activist or celeb being a part of the cause rather than being about the cause itself.

Questions celebs about why similar causes are not being supported and why hasnt their support extended elsewhere in a ludicrous as in s self-centered society having issues being raised and constantly being monitored is worth its dose!!!

The Last Day at ABN-AMRO

Its been a good one year at ABN-AMRO. A memorable stint, not in terms of the vast knowledge or managerial experience I gained but it being my first proper Job. Call center was just another excuse to earn a quick buck. But ABN-AMRO has and will be special for various reasons.

Made close friends and hopefully that will last forvever. Apna yaar DD(Daxesh Dasani), apna item boy ---Suryakant Shah a.k.a. Surya, Vishal D'Costa----- Marketing Manager's Dream, Customer's Nightmare!!!!. Costa could sell anything, Ice in the Glaciers to Heaters in the Summer, Sea water to the thirsty to whatever your imagination permits.......


Daxesh Dasani aka DD the stud whose curls women die for, apna yaar guy who takes life as it comes and knows how to enjoy every moment of it. Jalsa as he says!!!! Rock on Dude!

Sudha Laksmi Suryanarayan aka Sudhlaks, a person who epitomises Sincerity, hard work, Discipline, passion commitment and Honesty @ work like no other. Life or the corporate world may have not been very kind to her but like she says gotta be patient with what you pick up in life and believe in the values you stood for. Hats off to you!!!!!

Eldon Vaz- The lord of Excel and man did he excel at it. Nishith Bhatt my TL, who got the shock of his like with a series of resignation letters that he received from his team and also gave us one when he gave his own. Miss his Accent(nothing personal) the Cash letter prounouced as Gay-sh-letter and Check as 6 in hindi Chey-K.

Miss the fact the work was peaceful, noy many to create problems and no pressure enjoyed working and miss working with them but yes do not miss work, do not wanna hit any other case (Kay-se) and report another time.

Call it a day, hang up my boots and embark on a journey together with 1.5 Lakh people. Yes the Baap of Entrance Exams CAT........!!!!!!!!!!!!!!! and hopefully will make it this time into the big league of B-schools..........................!!!!!!!!!

Crazy Fun

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