I personally feel and strongly believe that today, India is in a unique position to change her economic status to be a global leader and lead the world finacial order. With due respect to all the top think tanks of the Indian economy, that includes, Dr. Manmohan Singh - PM, P. Chidambaram - FM, Dr. Montek Singh - DC.PL.Comn, Dr. C.Rangarajan - Fmr Chr PM's Eco Adv Council, Dr. Subarao - Gov RBI, and other esteemed and distingued contributors. But saying this, I feel that they are fire fighting, in the sense that they are waiting for a crisis to strike then fire fight, rather than to stay ahead of the curve and take some bold and concrete measures that will not only protect and insulate our economy from the current crisis, but will also stimulate growth. Unlike other Emerging Markets (EM), and BRIC countries.
The advantages that can be harnessed are,
* India's growth story in the last few years have been lead by her internal consumption rather than through exports. India's export's contribute only 20 - 25% of her GDP.
* A demographic profile which has the youngest population in the world.
* Falling commodity prices and falling crude prices.
* High rate of domestic savings and investments.
* Indian corporates are fully geared to meet the global challenges.
* Recognition by world powers about India's importance in the world scenario
* Huge forex reserves
* Low level of infrastructure (I have listed it as an advantage, because we can channel our investments and stimulate growth)
* Softening inflation
* Major portion of the banking industry is owned by the government.
* Higher levels of regulations
* Huge NRI population
* Global financial/banking meltdown
* Real estate and other asset classes crashing or correcting sharply
The challenges,
* Government of the day
* High exchange rate - USD
* Double digit inflation
* Liquidity crunch
* Global financial crisis
* Global recession scare
* Crisis of confidence
* High interest rates
Now the opportunity,
* With double digit inflation it does not make any sense to me to peg the exchange rate at 50/USD. With major portion of our import bill amounting to energy and crude oil, it makes more sense to use the fall on crude oil prices with lower exchange rates to make oil and energy more cheap and it has a direct impact on inflation. By bringing down the exchange rate, imported capital goods and other essential goods will also become cheaper. To my understanding the exchange rate can be pegged at around 35-37/USD. Critics may argue that this will kill our exports, with exports accounting for just 20% or little more of our GDP it makes sense. Also India Inc is used to lower exchange rates in the past and the net effect will be very positive.
* One of the major reasons for the Rupee to slide is the unprecedented pull of FII money out of the country. But we keep forgetting that, there is a huge NRI population with lots of liquidity sitting outside without knowing what to do with the cash. We can tap them, as they currently lack confidence in the global banks and other asset class, it would be prudent for our country to channel these funds into India as major portion of our banking system is sovereign backed and still our asset class has huge value left. This will ensure that the enormous pressure on the rupee will reduce and will bring down the exchange rate.
* To address the liquidity crisis the government along with the RBI can enact laws to use part of our vast forex reserves, which are predominantly invested in American securities and earn a paltry 3 to 4%!!! This reserve can be used to re-capitalise our Public sector banks and government can increase their share holding at today low levels and use this as an opportunity which any promoter will never miss. This ensure that the liquidity problem in the system gets addressed to some extent. After few years when the markets rebound, the government can disinvest part of this holding to book huge capital gains and channelise these profits into social infrastructure development and growth.
* As the inflation has started to soften, the government and RBI can plan for systematic rate cuts, and if the RBI also lowers the exchange rate, the inflation would soften further. By reducing the interest rates, this will create a unique opportunity to stimulate our economy once again to higher growth trajectories.
* Govt can start the investment cycle once again by promoting investments into infrastructure.
I am sure along with this, we can do many more things to convert the current crisis into an opportunity.
Wednesday, December 17, 2008
Where are we heading
Fellow countrymen,after the victory of the Indian Cricket team against England at Chennai, a prominent English news channel, IBN-CNN quoted that this victory is the best thing to happen for the highly hurt Indian sentiments after the terrible tragedy of the Mumbai terror attacks!!!
What is happehening, our morales, ethics, and values???
Cricket is a great sport and the victory has to be celebrated, encouraged, and rewarded but at what cost? What will the price we will pay? Is this right? What is happening to our media and ethical journalism?
This has to stop and we have to respect the feelings and sentiments of the families who have lost their near and dear and in some case the sole bread winner. Are we saying all this will be erased and changed by this sporting victory and in disguise of sports are adding insult to injury?
Personally I continue to pray for the brave security personnel and the members who fought an unequal war against the well trained, motivated, and highly weaponised and sphisticated terrorists who held Mumbai for 60 hours!
Our winning T20 cricket team was taken by an open highly decorated bus around the city, but our NSG commandos were taken back to their base by depleted, ruined state buses and all of us know the condition they are in and after fighting the terrorists for more than 60 hours do they need this? If we cannot learn to respect them at least let us not discount their valour and bravery!
Let us remain in silence for a minute for the families who lost their loved ones and for our fellow countrymen and armed forces who showed unparalled courage and character in combatting and making our lives better.
Jai Hind!
What is happehening, our morales, ethics, and values???
Cricket is a great sport and the victory has to be celebrated, encouraged, and rewarded but at what cost? What will the price we will pay? Is this right? What is happening to our media and ethical journalism?
This has to stop and we have to respect the feelings and sentiments of the families who have lost their near and dear and in some case the sole bread winner. Are we saying all this will be erased and changed by this sporting victory and in disguise of sports are adding insult to injury?
Personally I continue to pray for the brave security personnel and the members who fought an unequal war against the well trained, motivated, and highly weaponised and sphisticated terrorists who held Mumbai for 60 hours!
Our winning T20 cricket team was taken by an open highly decorated bus around the city, but our NSG commandos were taken back to their base by depleted, ruined state buses and all of us know the condition they are in and after fighting the terrorists for more than 60 hours do they need this? If we cannot learn to respect them at least let us not discount their valour and bravery!
Let us remain in silence for a minute for the families who lost their loved ones and for our fellow countrymen and armed forces who showed unparalled courage and character in combatting and making our lives better.
Jai Hind!
Saturday, December 13, 2008
Corruption, Mumbai Terror Attacks, & Terrorism As It Is
On November 26, 2008 a team of 10 terrorists attacked Mumbai the financial capital of India. Terrorism is not something new to India. Terrorism has consumed millions of lives in the past two decades and every other day an Indian becomes a victim of terrorism, please do not forget Jammu & Kashmir!
After consuming so many innocent lives and people in uniform, why this time after the Mumbai attack there is so much of anger and protest. The former Home Minister Shivaraj Patil, saved his post in spite of so many urban attacks and that too in the recent past like places in Bangalore, Jaipur, Ahemdabad, and also in Mumbai. But why was he replaced when Mumbai was attacked this time? Why was the Deputy Chief Minister and Chief Minister of Mumbai were replaced, does it mean all these days and years they were so efficient and only this time they failed? Why our Prime Minister and the new Home Minister P. Chidambaram apologized to the people of India. So why they did not so in the past when other attacks took place in other places. The role of electronic media should also be looked with suspicion! Why there is such coverage and till today it is been assured that the news is kept alive and ticking? Why?
You must have read in the media that Public Interest Litigation (PIL) is filed in the Honorable Mumbai High Court to modernize and equip the Mumbai police force and also a citizen charter be formed to oversee the modernization and reforms of the Mumbai police force. It has also been widely publicized in the media that several large corporate have come forward and India’s brightest legal heads are representing the case. Why?
There has been news that the ace actor Amithab Bachan has written in his blog that for the first time in his life he slept with a revolver under his pillow and that he felt very insecure! Why?
So many other top actors have come out in the media to express their grief and shock over what has happened and an unprecedented coverage has been given! Why?
Media exposed that Mumbai Anti Terrorism Squad (ATS) chief Hemat Karkare used a faulty bullet proof jacket and in case the bullet proof jacket met the quality standards then there is a chance that he might not have fallen pray to the bullets fired from the AK47 assault rifles used by the terrorists! So does it mean that our corruption consumed the ATS chief and not the bullets fired by the terrorists! Was the media not aware of corruption all along, I don’t mean just in the Mumbai police force, all of us know India ranks very high in the corruption list and why was the media turning a blind eye for so long? Why?
So why?
No doubt in terms of sophistication and planning these attacks were very different and the magnitude was overwhelming. But at the same time the lives consumed around 180 and odd is in par or little higher, in terms of lives already lost due to terrorism. We as Indians are used to lives being lost by terrorist attacks more frequently. But why this time it gained so much of momentum? Politicians, actors, media, corporate, professionals, and the innocent public have shown and expressed so much anger like never before?
Dear fellow countrymen please think, please take some time and see what happened? It is not a conspiracy theory! So what made the difference this time?
If you keenly watch and observe all these years the victims of terrorism were ordinary citizens like you and me. Never before a terrorist act has consumed and hit people of the highest order. See for yourself the targets of terror this time, other than the CST and the hospital it was all targets of high value, I just don’t mean the buildings and locations, but the lives lost. Never before in India a private bank’s Chairmen was consumed by terror! People of the highest order and people who call the shots from behind the scene whether in politics or business frequent places like Taj and Oberai. These people drive the political parties and the likes. Sure Amithab Bachan should feel insecure for all this time he was of the opinion that people like him will not fall as a victim of terror. This fundamental belief was shaken with these attacks. Ordinary lives were consumed all these years and he did not feel the urge to take out his revolver and keep it under his pillow.
I am sure that the people who filed the PIL were totally aware about the state of the Mumbai police all along, but what they were not aware was that it could also affect their lives and affect them in a very significant way. Why all these days and years they did not feel to lead the movement to reform and modernize the force? So it is obvious and the reasons are for you to see.
Please do not be carried away, it has been established without any doubt that the act of terrorism is not the issue but the target this time made all the difference. I salute the security forces, the Mumbai police force, the National Security Guards, and other brave men who laid their lives for a noble cause they died in the line of duty. But what democracy could not achieve a group of ten terrorists with heavy arms, determination, training, lots of help from our neighbors, and our corruption achieved.
Let us not forget at this juncture there are millions of families in India who have lost their loved ones due to terrorism and they lie low and depressed without any support or love they deserve. There are many more from the armed forces who have lost their lives in the line of duty, and their family is betrayed and they have no where to go. Let us continue to fight just not terrorism, but also hypocrisy and corruption. I am sure corruption is more dangerous than terrorism as it is the enemy within!
Salutations to our Motherland!
Jai Hind!
After consuming so many innocent lives and people in uniform, why this time after the Mumbai attack there is so much of anger and protest. The former Home Minister Shivaraj Patil, saved his post in spite of so many urban attacks and that too in the recent past like places in Bangalore, Jaipur, Ahemdabad, and also in Mumbai. But why was he replaced when Mumbai was attacked this time? Why was the Deputy Chief Minister and Chief Minister of Mumbai were replaced, does it mean all these days and years they were so efficient and only this time they failed? Why our Prime Minister and the new Home Minister P. Chidambaram apologized to the people of India. So why they did not so in the past when other attacks took place in other places. The role of electronic media should also be looked with suspicion! Why there is such coverage and till today it is been assured that the news is kept alive and ticking? Why?
You must have read in the media that Public Interest Litigation (PIL) is filed in the Honorable Mumbai High Court to modernize and equip the Mumbai police force and also a citizen charter be formed to oversee the modernization and reforms of the Mumbai police force. It has also been widely publicized in the media that several large corporate have come forward and India’s brightest legal heads are representing the case. Why?
There has been news that the ace actor Amithab Bachan has written in his blog that for the first time in his life he slept with a revolver under his pillow and that he felt very insecure! Why?
So many other top actors have come out in the media to express their grief and shock over what has happened and an unprecedented coverage has been given! Why?
Media exposed that Mumbai Anti Terrorism Squad (ATS) chief Hemat Karkare used a faulty bullet proof jacket and in case the bullet proof jacket met the quality standards then there is a chance that he might not have fallen pray to the bullets fired from the AK47 assault rifles used by the terrorists! So does it mean that our corruption consumed the ATS chief and not the bullets fired by the terrorists! Was the media not aware of corruption all along, I don’t mean just in the Mumbai police force, all of us know India ranks very high in the corruption list and why was the media turning a blind eye for so long? Why?
So why?
No doubt in terms of sophistication and planning these attacks were very different and the magnitude was overwhelming. But at the same time the lives consumed around 180 and odd is in par or little higher, in terms of lives already lost due to terrorism. We as Indians are used to lives being lost by terrorist attacks more frequently. But why this time it gained so much of momentum? Politicians, actors, media, corporate, professionals, and the innocent public have shown and expressed so much anger like never before?
Dear fellow countrymen please think, please take some time and see what happened? It is not a conspiracy theory! So what made the difference this time?
If you keenly watch and observe all these years the victims of terrorism were ordinary citizens like you and me. Never before a terrorist act has consumed and hit people of the highest order. See for yourself the targets of terror this time, other than the CST and the hospital it was all targets of high value, I just don’t mean the buildings and locations, but the lives lost. Never before in India a private bank’s Chairmen was consumed by terror! People of the highest order and people who call the shots from behind the scene whether in politics or business frequent places like Taj and Oberai. These people drive the political parties and the likes. Sure Amithab Bachan should feel insecure for all this time he was of the opinion that people like him will not fall as a victim of terror. This fundamental belief was shaken with these attacks. Ordinary lives were consumed all these years and he did not feel the urge to take out his revolver and keep it under his pillow.
I am sure that the people who filed the PIL were totally aware about the state of the Mumbai police all along, but what they were not aware was that it could also affect their lives and affect them in a very significant way. Why all these days and years they did not feel to lead the movement to reform and modernize the force? So it is obvious and the reasons are for you to see.
Please do not be carried away, it has been established without any doubt that the act of terrorism is not the issue but the target this time made all the difference. I salute the security forces, the Mumbai police force, the National Security Guards, and other brave men who laid their lives for a noble cause they died in the line of duty. But what democracy could not achieve a group of ten terrorists with heavy arms, determination, training, lots of help from our neighbors, and our corruption achieved.
Let us not forget at this juncture there are millions of families in India who have lost their loved ones due to terrorism and they lie low and depressed without any support or love they deserve. There are many more from the armed forces who have lost their lives in the line of duty, and their family is betrayed and they have no where to go. Let us continue to fight just not terrorism, but also hypocrisy and corruption. I am sure corruption is more dangerous than terrorism as it is the enemy within!
Salutations to our Motherland!
Jai Hind!
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