India Insight

The dog days of India’s bizarre summer of politics

Perhaps the government’s decision to push back the opening of the upcoming monsoon session of parliament was not the best idea. For as the dog days of the sub-continent’s sweltering summer drag on, the parliament-less politicians sweat from the sublime to the ridiculous in the baking heat.

From the haphazard ensemble of senior ministers that flocked to New Delhi’s airport to greet yoga guru turned social activist Swami Ramdev with more fanfare than is reserved for visiting heads of state, to the current conspiracy swirling New Delhi surrounding espionage chewing gum found in the finance minister’s private chambers, it has been a bizarre summer for politics fuelled by the hungry media in the world’s largest democracy.

Kapil Sibal, as Human Resource and Development minister, could have spent his summer break drawing up plans to overhaul an education sector that looks dangerously inadequate to deal with the demographic dividend of millions of young Indians that New Delhi likes to trumpet. Instead, he spent his days holed up in five-star hotels begging Ramdev not to stop eating, and playing it coy in press conferences after quietly ignoring veteran activist Anna Hazare’s demands for a stronger anti-graft bill.

Finance Minister Pranab Mukherjee, who has seen a series of economic data releases over the past month pour cold water on optimistic growth prospects, spent the majority of his summer trying to chair what appeared to be most unruly meetings on the anti-graft legislation, but has stolen the headlines recently with a mind-boggling story involving government secrets, ministerial rivalries and old-school espionage — all bonded together with chewing gum.

With TV channels and opposition politicians dubbing it “India’s Watergate”, and political figures from across the spectrum weighing in on the sticky mess, there appears little evidence to go on than a few errant pieces of gum stuck under various desks in Mukherjee’s chambers. With the minister himself telling the media to take their conspiracy theories elsewhere, it appears more a case of unhygienic office visitors than dastardly undercover spies.

Should Britain continue its controversial £1bln India aid package?

The UK will continue to send more than £1 billion to India over the next four years, despite huge cuts to government spending under London’s Conservative-led coalition government and soaring economic growth in the Asian giant.
Britain's Secretary of State for International Development Andrew Mitchell speaks during a plenary meeting of the 64th General Assembly of the United Nations  August 19, 2010. REUTERS/Lucas Jackson
Andrew Mitchell, the UK’s international development secretary, told the Financial Times on Monday that Britain’s annual £280 million aid payments to India would not be reduced, in spite of the country’s space ambitions, nuclear energy development, soaring numbers of billionaires and its own aid program to many African nations.

Mitchell’s comments, a day before an official announcement, are likely to infuriate some UK MPs who have seen spending slashed in their constituencies, and those who have called for a reduction in overseas payments as British taxpayers brace for a period of tough austerity measures.

In September, suggestions from Westminster that aid may be reduced sparked a terse response from New Delhi, as Indian officials reportedly mulled rejecting UK support rather than waiting for London to decide whether its slice of the pie would shrink.

Has Congress lost the plot on inflation?

“Government Plan To Tackle Prices Is Just Hot Air” screamed the front page of Friday’s Mail Today, as India’s political media lined up to belittle what was billed as a list of anti-inflationary remedies but was robustly rejected as “already failed measures and oft-repeated homilies.”

India's Prime Minister Manmohan Singh, ruling Congress party Chief Sonia Gandhi and Finance Minister Pranab Mukherjee stand to attention as the national anthem is played during an oath-taking ceremony inside the presidential palace in New Delhi May 28, 2009. REUTERS/B Mathur

Prime Minister Manmohan Singh’s meetings this week with senior cabinet ministers to tackle year-high food inflation dragged on long into the night, keeping editors on tenterhooks and assuring Congress of front page headlines.

This morning, those headlines would have made for painful reading. After rumours of export curbs and future markets tweaks, what emerged to be a paltry list of recommendations was seen by many as nothing but ineffective band-aids for a broken economy requiring surgery.

Survey says doing business in India is tough

A big banner of of U.S. President Barack Obama is pictured on a building in Mumbai November 6, 2010. REUTERS/Fayaz Kabli

Even as India Inc celebrates U.S. President Barack Obama’s recognition of the country as a world super power, a recent study by the World Bank presents a contrasting view.

India ranks 134 among 183 nations in a survey called “Doing Business 2011″  — that gauges the ease of doing business in a country — and is ranked behind countries like arch rival Pakistan, Bangladesh and Sri Lanka.

Singapore leads the pack, while Hong Kong grabs the second position in the list.

Could Obama’s loss be India’s gain?

As the pundits predicted, India will have the inauspicious honour of being the first country to host U.S. President Barack Obama following the largest shift in public support away from an incumbent President’s party in over 60 years.
U.S. President Barack Obama attends a DNC Moving America Forward Rally at Cleveland State University in Ohio, October 31, 2010. REUTERS/Larry Downing

But if the results show a clear message of dissatisfaction at Washington from U.S. voters, the fallout once the dust settles on Capitol Hill could well result in good news for India.

Here are three ways that a shift in Washington politics could play into India’s interests:

from Tales from the Trail:

Green energy aspirations for Obama’s India visit

INDIAWhen Barack Obama heads for India next month, he'll be carrying a heavy policy agenda -- questions over the handling of nuclear material, the outsourcing of U.S. jobs and India's status as a growing economic power, along with regional relations with Pakistan and Afghanistan. But Rajendra Pachauri, the Nobel Peace laureate who heads the U.N. Intergovernmental Panel on Climate Change, hopes the U.S. president has time to focus on clean energy too.

Even as Pachauri and the U.N. panel evolve -- and as Pachauri himself weathers pressure from some quarters to resign -- he urged Obama to work on U.S.-India projects that he said would enhance global energy security.

Given India's red-hot economic growth rate -- 8 or 9 percent a year, Pachauri told reporters during a telephone briefing -- he said it makes sense for the United States to work with India to head off an expected soaring demand for fossil fuels.

Going global in India’s chaotic way

Labourers walk on a flyover in front of the Jawaharlal Nehru Stadium in New Delhi September 25, 2010. REUTERS/Krishnendu Halder

India is globalising, but not the way much of the world wants.

That rather contradictory thought nagged at me one morning during the chaotic Commonwealth Games here in New Delhi.

On the road to the media venue’s gate, I trudged past a squatter’s family living in a tarpaulin. The mother was helping her son pee on my left. Rubbish, the smelly, sickly kind, lay to my right. My shoes sunk in mud from an unfinished pavement.

Hardly the stuff of a showcase international event meant to rival China. But after four years in India, the scene appeared normal. So was news during the Games that stocks had hit a near three-year high and that the Economist had predicted India’s economy would soon outpace China.

Urbanisation: threat to Indian economy?

India’s current approach to urban development is insufficient for the task and needs an immediate revamp, according to global consultancy McKinsey & Co. INDIA

In its report “India’s Urban Awakening – Building cities, sustaining economic growth”, McKinsey states that a good city should be able to offer fine public infrastructure, reliable social services, recreational and community infrastructure and sustainable environment. 

As Delhiites complain of increasing road traffic, pollution and population many experts suggest that the development of the capital for the Commonwealth Games will lead to an increase in urban migration. Do you think Delhi is ready for this? 

Budget 2010: Time for annual guessing game

It’s a laudable effort that often gets more brickbats than bouquets. This year, when Finance Minister Pranab Mukherjee presents the Union budget in parliament on February 26, he will walking a tightrope between managing ballooning fiscal deficit and supporting economic recovery in Asia’s third-biggest economy.

Budget 2010: Time for the annual guessing gameExpectations from the finance minister, as always, are high — people and corporates want more in their pockets. There has been no let-up in the rise of food prices and most middle-class families still have to wait for annual sales to get branded products home.

In other words, the nation would like to see changes in tax rates, consumables getting cheaper and credit continuing to be available easily.

Why should the government control inflation?

A labourer pulls a plastic sheet to cover sacks of paddy from rain at a grain market in Chandigarh January 13, 2010. REUTERS/Ajay VermaThe ‘reform agenda’ understood as ‘market-oriented reform’ or giving more space to market mechanism in food and fuel economy seems to have been held up.

The government can not be seen to be doing away with subsidies just as prices are up. Its hand is stayed for now.

But is that enough for say the gross national happiness?

Food and fuel inflation has been in the news for a while.

The government has no short-term control over supply side issues causing price rise like a bad monsoon leading to a low harvest or floods, but it can control the rising demand by reining in liquidity.

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