RBI survey says that inflation will remain double digit for most of the year at will drop slightly at 9 per cent by the end early 2009 (Reuters reports)

Then we have the Palaniappan Chidambaram, the finance minister, telling us that interest rate will ease in the next six to 12 month, however, he does not provide any figures or substantial evidence on how this will happen.  (See Reuters report)

Then came some solid data: “India’s Exports Rise 23.5% to $14.66 Billion in June”, says Bloomberg. Now this sounds good. But if you read between the lines “the trade deficit crossed $30 billion for the
first three months of the 2008/09 fiscal year, 42 percent higher than in the previous year,” according to Reuters.

Then we find out that India is the second best place in the world to invest in after China, according to a survey by Development Counsellors International, who interviewed 281 executives.
So what does this mean?

Is India still a success story or is going through a reality check? Is it back to boom days or doomed ones again?

Well, for the time being there are more questions than answers. And stats, surveys, spin from government ministers doesn’t seem to provide any clarity to the future of the economy.

Gilani met with George W. Bush this week and has made it clear that Pakistan should receive the same treatment as India.

“There should be no preferential, there should be no discrimination. And if they want to give civilian nuclear status to India, we would also expect the same for Pakistan too,” Gilani said at a press conference in Washington.

Now that sounds sensible, but the real question is: Hasn’t Pakistan already received a preferential treatment form the US since the 9/11 attacks in 2001 for its contribution to the fight on terror?

Pakistan has received more than $9bn from the US for it’s contribution in the “war on terror”, in spite of the very poor results and growing terrorist activity on the boarder with Afghanistan, which has been blamed on Pakistan’s military.

The recent terrorist attack against the Indian embassy in Kabul has been blamed on Pakistan by several high-level American security sources.

A New York Times report reveals today that top US officials have secretly travelled to Pakistan this month to confront the country’s “most senior officials with new information about ties between the country’s powerful spy service and militants operating in Pakistan’s tribal areas, according to American military and intelligence officials.”

“The CIA emissary presented evidence showing that members of the spy service had deepened their ties with some militant groups that were responsible for a surge of violence in Afghanistan, possibly including the suicide bombing this month of the Indian Embassy in Kabul, the officials said.”

“The CIA assessment specifically points to links between members of the spy service, the Directorate for Inter-Services Intelligence, or ISI, and the militant network led by Maulavi Jalaluddin Haqqani, which American officials believe maintains close ties to senior figures of Al Qaeda in Pakistan’s tribal areas,” according to the NY Times.

So on the back of this, is Gilani right to say that the US should not give India a preferential treatment?

Let us know what you think.

Of all the pieces I’ve read two striked me. Two editorials, one from the Times of India and the other from the Business Standard. They have two very different ways of approaching what occured on Friday and Saturday. The two editorials have also opposite views of the future of the nation and how it should deal with the current threat of secterian division and violence.

Here are two exerpts:

Times of India – This is about Us: India is under attack, we must stick together

It is premature to place blame for the attacks on a particular group, indigenous or otherwise. It is also pointless to replay the refrain of the blame game between state and central intelligence agencies. Terror strike after terror strike, we are fed the same story about how each failed the other. There is clearly a systemic fault in our intelligence and security administration that exposes the public to dangers that could perhaps be avoided. It is an issue that must no doubt be redressed speedily. But it must be acknowledged that securing a country as vast and densely populated as ours is no easy task.

Business Standard – Dealing with Jihadis

An effective response to such a terrorist threat must work at several levels. The first is to nab the culprits and bring them to speedy justice. The second is to improve intelligence, to penetrate the jihadi network and to intercept communications so as to prevent such attacks…

…Other steps therefore are necessary…

…One is to address the fountainhead of terrorist attacks, which is in Pakistan. That country’s attitude to India remains deeply hostile, and India does not have the capacity to strike at it in a manner that will put an end to its ever-present temptation to engage in low-grade warfare against India. Again, as Israel has discovered, hitting hard at a much weaker neighbour has limited utility if the environment is such that new recruits are willing to join the jihadi network. Pakistan has to be tackled therefore with a mixture of bilateral diplomacy and international pressure, though experience has shown that the results of these efforts will be minimal. Pakistan therefore needs to be made to understand that its hostility to India is not without costs.

Let me know what you think about these two ways of seeing the current situation. Are you more with the TOI or with BS?

“The planet Jupiter is favourably placed in Manmohan Singh’s horoscope. This will protect him against the Saturn and Mars combination, that is in the 10th cuspal point from his ascendant, because of which he is facing this situation,” he told the Times of India.

Obviously!

However, Satish Sharma, the national vice-president of the Indian Council of Astrological Sciences, warns that the constellation that saved the prime minister this time round, might turn against Singh in September:

“Currently, the planet Jupiter is strong in Manmohan Singh’s horoscope. In addition, Saturn, which is in Leo, is protecting the 10th house in the country’s chart, which indicates that the government’s prestige would be saved. However, this position will not continue after September and there is every possibility that the government would not be able to complete its full term and elections will have to be preponed,” he told the ToI.

Rajan Chopra, another astrologer who spoke to Reuters’ reporter Rituparna Bhowmik, also predicted that UPA would have won the confidence vote, but he said it had nothing to do with Singh’s astrological horoscope. He argued that it was all thanks to Sonia Gandhi: “[She] is the main force behind [the PM],” he told Reuters.

Nothing new about that.

Singh, being a true gentleman, gave his main opponent LK Advani, who predicted that the prime minister would have lost the trust vote, a piece of advice:

“I do not expect Shri Advani to change his thinking…but for his sake and India’s sake, I urge him to at least change his astrologer so that he gets more accurate predictions of things to come.”

What emerged quite clearly from yesterday’s parliamentary session is that the confidence vote had very little to do with the civilian nuclear deal with the US and the fate of India’s resilient people. What we witnessed in the Lok Sabha – the parliament – was a battle of egos, not of ideas. So the biggest loser in yesterday’s vote are the people.

The likelyhood that this government will push ahead with the reforms the country desperately needs – such as allowing greater foreign investment in several key sectors – is low, as the government feels the only way it can win popular support is by implementing populist policies.

So who is the real winner of this confidence vote? Manmohan Singh? No. Sonia Gandhi? Maybe. Mayawati, the Dalit leader? Yes.

Singh is a loser because he has just delayed of a few month the tenure of his stay in power. There is no hope for him in the future leadership of the government or the party. I’m sure the World Bank would be happy to employ him again.

Sonia Gandhi proved once again that she is the true leader of the country and she showed great skills in keeping everything together. However, the future of the party is grim and the leadership vacuum, which Congress faces once Singh leaves, will not be filled by her son Rahul, who is far from being ready to direct the party, let alone the nation.

Mayawati, also know as the “Queen of the dalits”, lower-caste, seems to be the true winner. Although she has failed to bring down the current government, her alliance with the Left might turnout to be strategically sound. Potentially she could form a new pole in the political system, which could give her a lot of leverage at the next election.

Mayawati, could easily turnout to be the Obama of India. As Americans seems ready to elect the first black president of the US, Indians might be ready to elect the first Dalit prime minister in the subcontinent. If the media picks up on this parallel it could give Mayawati a serious chance to challenge the establishment.

At 10 am, Bombay Stock Exchange’s Sensex soared to 14,739.79, up 4.5 per cent or 636 points from Tuesday’s close. National Stock Exchange’s Nifty climbed 4.28 per cent or 181.35 points to 4421.45.

Times of India - Trust in bag, UPA to take N-deal to next level

Times of India - Cash-on-table a first in Lok Sabha history

Business Standard - Bribery drama eclipses UPA win

Mint – UPA wins, setting stage for either pay-offs or reforms

The Calcutta Telegraph – Mohan rules: the myth of a weak Prime Minister

]]> http://indiadispatch.wordpress.com/2008/07/23/live-blogging-upa-wins-275-vs-256-singh-smiles/feed/ 0 indiadispatch http://indiadispatch.wordpress.com/2008/07/22/live-blogging-no-comment/ http://indiadispatch.wordpress.com/2008/07/22/live-blogging-no-comment/#comments Tue, 22 Jul 2008 22:55:03 +0000 indiadispatch http://indiadispatch.wordpress.com/?p=78 ]]>

But the real question is: how much will growth be in the next fiscal year (2008/2009)? With inflation at a 13-years record high many fear that growth will fall below seven per cent.

But Chidambaramis confident it will remain fairly high at 7-8 per cent. “This government will ensure that economy will grow at 7-8 per cent compared to an average growth of 5-6 per cent when NDA was in power,” Chidambaram said during the debate on the vote of confidence motion in Lok Sabha.