Expert Zone

Straight from the Specialists

The U.S. must move cautiously on Taliban reconciliation

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

The Obama Administration is seeking to negotiate with the Taliban as it continues a drawdown of U.S. troops in Afghanistan. Following recent setbacks for the U.S. mission in Afghanistan — including nationwide protests sparked by the accidental burning of Korans and a U.S. staff sergeant’s shooting rampage that killed 17 Afghan civilians — the Taliban suspended negotiations with the U.S. Some observers had touted the Taliban’s earlier willingness to open a political office in Qatar as a major breakthrough for a political process.

However, the Taliban has not renounced terrorism or its support for al-Qaeda. Moreover, the Taliban leadership is seeking to exclude the Karzai government from the talks, which indicates that it is likely merely interested in having comrades released from prison, and is seeking to make a backdoor deal with the U.S. that allows them to regain power.

The building blocks for peace and stability in Afghanistan are not yet in place. The military gains made against the Taliban over the past 18 months are still fragile. While it may make sense for the Administration to keep doors open for negotiations with the Taliban, it would be unwise for the U.S. to make major concessions before the Taliban has renounced international terrorism and demonstrated willingness to compromise politically.

Will the rate cut boost auto sales?

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

Last week, the Reserve Bank of India (RBI) cut its lending rate by 50 basis points. This came as welcome relief for automakers as well as consumers since the domestic market was particularly sluggish last year, owing to high interest rates and an increase in raw material and fuel prices.

U.S.-Afghan agreement: Issues to be addressed

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

The draft strategic partnership agreement between the U.S. and Kabul to address their relationship after the completion of the International Security Assistance Force (ISAF) withdrawal in 2014 has been arrived at after negotiations. The draft addresses the issues for ten years beyond 2014. A scrutiny of Afghan forces and the challenges they face highlights issues that merit inclusion in the agreement.

Investors shouldn’t read too much into repo rate cut

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

The last time the Reserve Bank of India (RBI) surprised the markets was when it announced a 75 bps cut in cash reserve ration (CRR) days before its mid-quarter review of monetary policy on March 15. It did so again in its annual monetary policy meeting on April 17, with a 50 bps repo rate cut when the markets were either expecting no rate cut or a 25 bps rate cut at best.

RBI rate cut — too little, too late?

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

The RBI Governor cut the repo rate on April 17 quite reluctantly, even hinting there wouldn’t be another cut soon. Perhaps, he was under pressure from elsewhere, compelling him to look beyond inflation which had been his sole criterion in raising the repo rate.

India hiding from its own ‘crap’

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By C. Uday Bhaskar

(The views expressed in this column are the author’s own and do not represent those of Reuters)

India, to put it euphemistically, is awash in its own ‘crap’ — a word derived from old Dutch to mean excrement. While accurate to an alarming degree, coming soon after the euphoria over the Agni missile tests, the discomfiture is evident.

India Market Weekahead – Volatile market within a narrow range

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

A sharper-than-expected cut of 50 basis points in the repo rate boosted the benchmark indices early during the week. However, as expected, the Nifty could not gain higher than 5350 as apprehensions about the limited scope of further rate cuts suppressed sentiment.

The hunt for Hafiz Saeed

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

The $10 million bounty placed on Hafiz Saeed by the Americans may have been barely noticed in most capital cities but it definitely had an impact in New Delhi and caused a furore in Islamabad. India and Pakistan are the two countries most concerned with Saeed’s health and activities, although for different reasons.

Tax breaks only if insurance cover is 10 times annual premium

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

Tax exemption under Section 80C is one of the major drivers of insurance sales. In fact, it has become a trend to launch a new variant of single-premium plans in February-March to cater to those who just want to make some investment to avail tax benefits.

Expectations from the RBI policy review

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(The views expressed in this column are the author’s own and do not represent those of Reuters)

With more than 70 pct of the banking market in the grip of public sector banks (PSBs), who have a combination of constraints to lend freely, the Reserve Bank of India’s policy review amounts to almost a strategic push for these PSBs. Thus, the eagerness with which the policy review is awaited.

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