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Oct 4, 2012

Breakingviews: What else could Manmohan Singh reform?

By Jeff Glekin

MUMBAI (Reuters Breakingviews) – In India, it was called big bang Friday. That was the day when Manmohan Singh unleashed bold economic reforms. Assuming the Prime Minister’s nerve holds in the face of strong protests, he may even get a taste for such announcements. India’s financial sector, mining industry and labour market would all benefit from a similar approach.

The 79-year-old Singh seems to have finally convinced Sonia Gandhi, the real power behind the throne, that without a revival in growth the chances of the Congress party clinging to power in 2014 are slim.

Oct 3, 2012

What else could Manmohan Singh reform?

By Jeff Glekin

MUMBAI (Reuters Breakingviews) – In India, it’s being called big bang Friday. That was the day when Manmohan Singh unleashed bold economic reforms. Assuming the Prime Minister’s nerve holds in the face of strong protests, he may even get a taste for such announcements. India’s financial sector, mining industry and labour market would all benefit from a similar approach.

The 79-year-old Singh seems to have finally convinced Sonia Gandhi, the real power behind the throne, that without a revival in growth the chances of the Congress party clinging to power in 2014 are slim.

Oct 1, 2012

India is still unravelling

(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)

By Jeff Glekin

MUMBAI (Reuters Breakingviews) – India is still unravelling. Nine months ago, Reuters Breakingviews published a three-part series on the state of the country’s economy. At that time, most economists projected GDP growth of around 7 percent in 2012, a sharp drop from the near-double digit expansion of the boom. Today, India has fallen further behind. The case for economic reform – and a realignment of the political system – remains as strong as ever.

Sep 27, 2012
via Breakingviews

How Sahara left Indian investors feeling deserted

Photo

By Jeff Glekin

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

There’s no bigger sport in India than cricket. So you might think that the company which sponsors the Indian national team would be a household name. But Sahara has always been shrouded in mystery. Now, following a ruling by the country’s Supreme Court that the company must return $4.5 billion to millions of small investors, its finances are set for a stiff examination. The saga also raises important questions about Indian financial regulation – and how such scandals can be avoided in the future.

Sep 20, 2012

India’s striking shopkeepers’ fears are overblown

By Jeff Glekin

MUMBAI (Reuters Breakingviews) – India’s striking shopkeepers needn’t worry so much about proposed reforms to the retail sector. New reforms proposed by Prime Minister Manmohan Singh will eventually open the door to global retailers like Wal-Mart (WMT.N: Quote, Profile, Research), Carrefour (CARR.PA: Quote, Profile, Research) and Tesco (TSCO.L: Quote, Profile, Research), all currently limited to running wholesale businesses. But India’s small shops won’t go out of business any time soon. Competition may even be good for them.

There are an estimated 50 million “mom and pop stores” in India, and some 220 million people depend on them for their livelihoods, according to the Confederation of All India Traders. In developed markets small shops have suffered under competition from big-box retail. The suggestion of letting foreign retailers own 51 percent of retail joint ventures saw shopkeepers join waves of strikes across the country on September 20.

Sep 17, 2012

What else could Manmohan Singh reform?

By Jeff Glekin

MUMBAI (Reuters Breakingviews) – In India, it’s being called big bang Friday. That was the day when Manmohan Singh unleashed bold economic reforms. Assuming the Prime Minister’s nerve holds in the face of strong protests, he may even get a taste for such announcements. India’s financial sector, mining industry and labour market would all benefit from a similar approach.

The 79-year old Singh seems to have finally convinced Sonia Ghandi, the real power behind the throne, that without a revival in growth the chances of the Congress party clinging to power in 2014 are slim.

Sep 14, 2012

New Delhi must stand its ground on subsidy cuts

By Jeff Glekin

MUMBAI, Sept 14 (Reuters Breakingviews) – The government has
announced a bold 14 percent hike in the price of diesel. Now it
needs to stay the course, embrace the decision rather than
apologise for it, and move fast to get even more done. A shift
in public spending from consumption to investment is the
ultimate goal.

Full view will be published shortly.

CONTEXT NEWS

- The Indian government raised the price of heavily
subsidised diesel late on Sept. 13. A cabinet committee
increased diesel prices by 5 rupees per litre. That translates
as a 14 percent rise, including taxes. The committee also
decided to limit the number of subsidised cooking gas cylinders
per household to six per year, a move seen as hitting the poor
hard. Any LPG cylinders bought over this ceiling will be at
market rates, which could almost double the price.

Sep 14, 2012

Regulator’s past haunts India’s Sahara case

(Refiles to correct format)

(The author is a Reuters Breakingviews columnist. The
opinions expressed are his own)

By Jeff Glekin

MUMBAI, Sept 14 (Reuters Breakingviews) – India’s top
securities regulator is under a cloud. Last year a former deputy
to the chairman of the Securities and Exchange Board of India

Sep 14, 2012

SEBI’s past haunts Sahara case

By Jeff Glekin

MUMBAI (Reuters Breakingviews) – India’s top securities regulator is under a cloud. Last year a former deputy to the chairman of the Securities and Exchange Board of India (SEBI) wrote to the prime minister alleging that Upendra Kumar Sinha was going easy on the Sahara conglomerate (SAHM.BO: Quote, Profile, Research) (SAHR.BO: Quote, Profile, Research). That puts SEBI, which has been tasked with overseeing the repayment of over $5 billion that Sahara raised from 30 million rural investors, in an awkward position.

Between 2008 and 2011, two unlisted Sahara companies raised a total of $4.3 billion using instruments known as optionally fully convertible debentures. Under Sinha’s predecessor, SEBI ordered the group to refund the money, with 15 percent annual interest, after it found that the fund-raising process did not comply with securities market rules. The Supreme Court has just upheld that ruling.

Sep 12, 2012

India’s bad economic data may spur better policy

By Jeff Glekin

MUMBAI (Reuters Breakingviews) – Almost flat industrial production may sound like bad news in India. But July’s disappointing figure may be just what the country needs. It might lead to a reduction in wasteful fuel subsidies, which account for a large chunk of India’s fiscal deficit, currently 5.9 percent of GDP.

The new Finance Minister, P. Chidambaram, understands the problem. According to a Reuters report, he is working up a plan with the Reserve Bank of India that would amount to a policy trade: he unveils fiscal reforms and the central bank eases interest rates. The RBI’s reluctance to move first is easy to understand. India’s inflation rate probably picked up slightly in August from July’s near three-year low as poor summer rains drove up food prices, a Reuters poll showed. That gives the RBI even less room to cut policy rates at its meeting next week.

    • About Jeff

      "Jeff Glekin is the India columnist for Breakingviews. Jeff is a former diplomat. He spent four years in Mumbai as the Deputy Head of Mission and First Secretary Financial and Economic at the British Deputy High Commission. Before joining the diplomatic service he spent four years with HM Treasury in London. He has a BA in Philosophy, Politics and Economics from Mansfield College, Oxford University."
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