February 20, 2010
ü With the Andhra Pradesh government expressing a fear that naxalites had infiltrated the Osmania University campus in the guise of students, the Supreme Court on Friday stayed an interim order of a single judge of the Andhra Pradesh High Court directing the State government to withdraw the para-military/rapid action forces from the campus.
ü Intellectual support to Maoists made the task of tackling them “very difficult” as it confused people, Union Home Minister P. Chidambaram said in Delhi on Friday.
· Some of our views on the ongoing struggle between the government and the Maoists.
· The most difficult element in dealing with Naxalites is lack of trained policemen.
· It is followed by intellectual and material support.
· Historically, the battle with the Maoists has raged since 1967 when the first Maoist rebellion erupted and has grown over the past 5 years following the formation of the CPI (Maoist), in 2004, through the merger of two prominent Naxalite groups, the Peoples War Group (PWG) and the Maoist Communist Centre (MCC).
· The CPI (Maoist), on its part, has intensified its attacks in different parts of the country. They include Jharkhand, Chhattisgarh and Orissa, which are the organisation’s strongholds, the Gadchiroli region in Maharashtra, where it is apparently recapturing lost space, and parts of West Bengal, where it has made forays in the past two years.
· According to Union Home Secretary Gopal Krishna Pillai, the arrests of Ghandy and Bagchi signify remarkable improvement in terms of intelligence gathering vis-a-vis Maoist operations.
· The new Home ministry initiative is also broadly based on the confabulations that took place over the past two years under the auspices of the Ministry
· According to informal estimates, the CPI (Maoist) has more than 20,000 armed cadre, apart from lakhs of supporters.
· Union Home Ministry officials pointed out that as part of the new initiative a detailed study of the Maoist-affected areas was done and the most sensitive and difficult areas were mapped. The study identified 11 areas as most sensitive, spread over 40 districts
· Forces would be deployed in these areas and the forces deployed in an area would be followed by a back-up team that focuses on socio-economic development.
· These are the basic actions that have been taken against the Maoists in the past couple of years.
ü Mr. Chidambaram has hinted that certain specific issues relating to the Mumbai 26/11 attacks would be taken up with Pakistan during the upcoming talks.
· This is a welcome move as this would provide the Indian government with the necessary thaws in moving the 26/11 case forward.
· India would also be in a better position to present its facts to other nations, if at all needed.
ü The BJP is planning a twin-campaign to corner the Centre on the issue of price rise of essential commodities.
· It will ‘gherao’ Parliament on April 21, when it is in session, and submit five crore signatures collected from all over the country to President Pratibha Patil.
· At the end of the party’s three-day conclave here on Friday, BJP president Nitin Gadkari said he expected a 15-lakh strong rally to surround Parliament.
· ‘Mahangai roko ya gaddi chodo’ (stop the inflation or quit) is the slogan for this mass agitation.
· The party president has blamed forward trading of cereals and sugar as the cause of price rise. But what is forward trading? Forward trading is a trading practice in which the price is fixed at an earlier date and the settlement is made at a stipulated later date. To minimize the risk of default in a forward trading agreement, future trading is used.
ü The Left parties have called upon the Union government to withdraw its decision to decontrol the price of fertilizers and a new nutrient-based subsidy scheme, arguing that this would have “disastrous repercussions” for the cultivating peasantry, especially small and marginal farmers.
· But what are the advantages and disadvantages of a nutrient based subsidy scheme?
o This move will ensure balanced application of fertilizers through the nutrient-based subsidy regime instead of the current product pricing regime.
o This move will ensure that even smaller farmers are able to gain incentives.
o This move is claimed to be more farmer friendly and is in alignment with other flagship schemes started by the government.
o Decontrolling the prices will help marginal and more efficient producers.
o Now, companies producing complex or nutrient-based fertilisers will be incentivized to invent products and increase their revenues in the long run, apart from the gains on margins.
o For the farmer, the application of nutrient-based fertiliser would help to increase overall productivity and, hence, lead to higher incomes.
· And what are the disadvantages?
o No immediate effects.
o Chances for further reductions in farm holdings.
o The move may find opposition amongst left parties.
o Adverse affects of free market pricing of fertilizers is a fear.
o Has a possibility to be seen as an “anti farmer move”
ü Veteran diplomat Shyam Saran has resigned as the Prime Minister’s Special Envoy on the India-U.S. nuclear deal and climate change. He will demit office on March 14.
ü Maoists set free Prashant Kumar Layek, Block Development Officer of Dalbhumgarh, on Friday. He was kidnapped a week ago from East Singhbhum district.
ü Preview to the budget ( Petroleum prices)
· As mentioned earlier, the decision to decontrol the prices of urea and fertilizers might well be an indication of a similar move in the prices of petrol.
· The government is already providing subsidies and has issued oil bonds worth Rs 12.000 crores. This has helped in controlling the prices of oil and gas so far in the retail sector.
· But, the government, due to its huge fiscal deficit (6.5%of GDP) is hard pressed to find money for its flagship schemes.
· This is a clear indication that there could be a roadmap for dismantling the Administered Price Mechanism which governs oil prices in the economy.
· The Kirit Parikh committee had recommended total decontrol of oil prices and the oil marketing companies want the same.
· One of the ways to lessen the impact on the common man is to reduce certain taxes and increase the price.
· The major problem that the Government seems to be facing is the opposition of its allies.
· Expert opinion recommends a hike in the oil and gas prices.
· The government is also looking at the option of a price regime that can be revised every month according to the global oil prices.
· It is important to consider the role of private players, who have opposed the subsidies doled out to the PSUs.
· Moreover, the pricing of kerosene has to be revamped by revamping the role of Public Distribution Systems also. There has been a lot of wastage, leakage, adulteration and inefficiency.
· A small note on deregulation.
o Deregulation is the removal or simplification of government rules and regulations that constrain the operation of market forces.
o Deregulation does not mean elimination of laws against fraud.
o The stated rationale for deregulation is often that fewer and simpler regulations will lead to a raised level of competitiveness, therefore higher productivity, more efficiency and lower prices overall.
o One influential measure of worldwide business regulations that has inspired mostly deregulation but also in some instances increased regulations is the Ease of Doing Business Index, in which India is ranked 132 out of 183 nations.
o One of the major oppositions leveled against deregulation is that it may lead to a market in which profit becomes the major motive.
ü Union Minister for Commerce and Industry Anand Sharma on Friday endorsed the seafood exporter community’s demand that fisheries be treated on a par with agriculture.
· A bit on the fishing sector in India.
o Fish production has increased more than fivefold since India's independence and is a major industry in the coastal states.
o It rose from only 800,000 tons in FY 1950 to 4.1 million tons in the early 1990s.
o Great potential exists for expanding the nation's fishing industry.
o India's exclusive economic zone, stretching 200 nautical miles (370 km) into the Indian Ocean, encompasses more than 2 million square kilometers. In the mid-1980s, only about 33 percent of that area was being exploited. The potential annual catch from the area has been estimated at 4.5 million tons.
o In addition to this marine zone, India has about 14,000 km² of brackish water available for aquaculture, of which only 600 km² were being farmed in the early 1990s; about 16,000 km² of freshwater lakes, ponds, and swamps; and nearly 64,000 kilometers of rivers and streams.
o There have been several programmes, institutes and training programmes in place to improve the sector.
ü The Supreme Court on Friday banned mining in 157 mines in the Aravalli Ranges, in respect of which applications for renewal of lease have been pending with the Rajasthan government.
ü China has voiced its strong opposition to the United States President Barack Obama's meeting with the Dalai Lama, warning it had “seriously damaged” Sino-U.S. ties.
· Implications of Obama’s Meeting
o The groundwork was laid last September, when the president quietly dispatched White House Senior Advisor Valerie Jarrett to Dharamsala, India, to personally deliver the invitation.
o All the US Presidents from Bush Sr. have met Dalai Lama.
o US has repeatedly maintained that it considers Tibet to be a part of China, but they do have concerns over the human rights violations.
o China considers the visit as a meddling in its affairs.
o The meeting came at a time when U.S.-Chinese relations are particularly raw, with China suspending military-to-military exchanges and warning of further retaliation over the Obama administration's approval of a multibillion-dollar arms sale to Taiwan, the self-governing democratic island that Beijing claims as its own.
o Disputes over trade, exchange rates, and human rights have also ratcheted up tensions, although Beijing has recently signaled through the official media that it doesn't want to see a major crisis.
o China might respond to the visit by calling off some bilateral contacts and dialing back cooperation with Washington on international issues.
o But, an understanding by Beijing that there is a need for cooperation between the two global powers on several issues has minimized its impact.
o The Chinese Premier is scheduled to visit Washington later this year and the forthcoming visit could imply the underlying connotations of Obama’s visit.
ü In what may be a broad prescription for the government's economic policy road map ahead of the Budget for 2010-11, the Prime Minister's Economic Advisory Council (PMEAC) on Friday pitched for a partial roll-back of stimulus measures to usher in fiscal correction by scaling up excise duties and service tax and “adjusting” Central expenditure without hurting capital spending on infrastructure.
· Since the expenditure stimulus was directed at augmenting consumption and not investment, the corrective measures must also focus on adjusting expenditure.
· The government finances have come under severe strain and the fiscal imbalance “is now a matter of concern”
· Government cannot continue with the kind of large revenue and fiscal deficits recorded in the last two years and will have to initiate fiscal consolidation in the coming fiscal year.
· Since more of fiscal expansion was owing to an increase in expenditure than from tax cuts, the Centre's expenditure would need to be curtailed.
· On the revenue side, while the Goods and Services Tax (GST) is unlikely to be implemented from the April 2010 deadline.
· There could be a possible expansion of the base of service tax “by converting the selective taxation of services into a general taxation, unify the threshold and rate structure of CENVAT and service tax to introduce GST at the Central level.
· There is a need to roll back service and excise tax and unify both the rates at 10 percent.
· As part of the stimulus package to industry to tackle the impact of the global meltdown, the government had reduced the excise duty from 14 per cent to 8 per cent and service tax from 12 per cent to 10 per cent.
· On the whole, a cut in fiscal deficit during 2011-12 by one per cent by outlay rationalisation and another 0.5 per cent from the revenue side would be a possibility.
ü The new simplified version of foreign direct investment (FDI) policy will be out on March 31, Union Minister for Commerce and Industry Anand Sharma said in Chennai on Friday.
ultimate initiative.. This will be a sucessful one.. nice blog.
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