Wi -Fi in Delhi

Cocooned as we are as a nation  in a mundane single frequency divisive politics for six decades now, we are blind to the exploding horizons of modern communications that opens up myriad frequencies to the power of connection ,information and a more fruitful existence.Visitors to Sri Lanka  can get a SIM card on arrival that empowers them with an identity and a personalised tool during the stay,for superior and cost effective communication . In Australia not only the airport at Sydney has an instant and hassle free WI-FI service, even the entire Darling Harbour area , the heart of commercial Sydney,has instant  free connectivity.At Changi airport of Singapore,you can get a WI-FI password from any of the many help desks.And look at Delhi. Not one" free  "WI-FI service flashing on your mobile,has ever worked since inception !

If modern governance is to be predicated on intense use of technology,how is it that an agenda of the Delhi  CM ,should invite a wry smile from the very elite that so vehemently propounds the empowerment of the  common man who must hence onwards,have an access to an effective ambient information stream to meet his increasing needs of  technological interface.

AAP-The party needs to continue with its idea

For those who looked forward to an AAP win, it has been a more than a very  generous gift. But vignettes  of the brief Phase I of the Kejriwal rule could stand to bring in more apprehensions than euphoria to their plate.Should the AAP be beset yet again with mavericks and individualism as against an integrated and focused thought process of a more mature political entity, AAP may pass into history in five years or less.And that would poor repayment to the emancipated Delhi electorate that has braved all odds to elevate the party to a near cult status today.The AAP must start with the earnest belief that it is cut out for a far greater regional role and to perhaps extend their range  over time,on the national canvas.With 65 seats, against a resurgent BJP,it has grown big enough to venture through far  taller portals .More than Kejrwal, the responsibility for shaping the party's future rests on  its  founder members and the immediate penumbra around the party.We have seen the Congress so sadly afflicted from the top and the BJP needlessly ,from the fringes.Things would  be more difficult for a fledgling AAP.

Kink in BJP's DNA

When a party that breaks the 30 year jinx of  coalition governments at the Centre with 282 seats on its own, ends up with just 3 seats in Delhi; there is lot more than faulted electoral strategies of the BJP  or a runaway AAP charisma. The Sangh parivar has never allowed individuals to overshadow it. Modi perhaps continues to remain an outsider to the core of the parivar .One must wonder how an experienced Modi allowed himself to be cut off so effectively from the domestic scene as fringe elements were riding high on the  hindutva bandwagon  , the PM  left an onlooker and confined to a busy calendar of managing external relations.The damage has now been wrought.There clearly are die- hards in the Parivar that believe  Modi has been commissioned just to swell the GDP and that all else is out of bounds for him !Delhi elections behind us,we certainly have not heard the last of such   internal contradictions, long enduring in the BJP.

The mirage of low crude prices

The IIP had been playing hide and seek for a while now and so too has inflation.We are discovering that low commodity prices and low inflation alone are no longer enough for economic revival .There must be newer theories of global trade and economics operating beyond our present Ken.
    The continued plunge of crude prices ,inexplicable in itself, gives us no clue whether it would now signal global economic recovery or a downfall!.
RBI's conservatism on key rates was no different when WPI was at 18 % to the current near zero. While shibboleths of old economics  need to be dared by newer apostles of global economics,there is a strong case for easing key rates towards the larger goal of boosting the manufacturing sector ,growth and job creation .Low commodity prices could be deceptive for growth. Crude at $35/40 may induce one to take his car out for a very long drive ,but only to return home and find himself ,jobless !.

CAG -Has done the damage

he spectre of a 1.76 lac Cr,loss so hamhandedly created by the CAG is still ,haunting the telecom sector to distraction .Surely had such a huge bonanza been had by the bidders at the UPA regime spectrum allocations ,today the telcos would not be reeling under a 2.5 lac Cr debt.We must admit that " faulted" process of allotment gave us one of the lowest tariffs globally and rocketed the. consumer base .Today the telcos are fighting both the lack of spectrum spread and inadequate revenue.Govt.must release additional widths and ensure that both the telcos and the consumer jointly climb the victory podium.A highly web enabled nation would be a national asset by any reckoning.

Raid of the right wing

There is much in common between the second terms in office of Obama and Manmohan Singh.Both had a core tenet of inclusivity in their politico- economic  outlook.And both faced extreme right-wing resistance.Neither the most powerful executive ,the US president nor the erudite and well read PM of the largest democracy could weather such orchestrated antipathy.
  If Obama's considerable efforts at re railing the US economy is being deliberately ignored by the Republicans,the BJP ever critical of Dr Singh,is now paying him backhanded compliment in following every economic policy of UPA II.This only underscores the flip side of large democracies where high decibels could well lead to low GDP !.

PSU Banks-Redesign

Even simple rural banking cooperatives have not improved in ten decades.All their ills of dual control and partisan interests got needlessly transmitted to the more modern PSU Banks.It need not have been so and this resulted in unprofessional management systems.The advent of private sector banks did improve the quality of govt.banks.Changes in the regulatory framework, rising customer expectations, shift in the employee demography and changes in technology have emerged as key drivers of change for the Public Sector Banks. The public sector banks are gearing up to meet demands from expansion, optimise resources, increase their presence across the value chain, renew focus on R&D and innovation, create a  better performance culture and service customer demands effectively. 
Government must now work towards cutting its stake This will help in raising the much needed capital through divestment route, aid in systematic recapitalization and more importantly bring in capable leadership that would perform with confidence and ability.

Planning commission

Does planning matter. On the basis of national income and other indicators, it would appear to have made little difference. Paradoxically, the highest growth rate of national income was  achieved during the Fifth Plan which, was mostly non plan period.The rate was 4.7 percent per year and  the second highest rate of growth (4.1 percent) was on the three years (1966-1968) when the planning exercise was in abeyance and the commission was on near holiday.The lowest rate of growth (2.4 per cent) was registered during the Third Plan (1961-1965) which, by all accounts, was the most successful of all plans and laid the foundation for much of the basic infrastructure of the economy. Going by national income figures,  high rates of growth seem associated with poor or indifferent plans and low rates with forceful planning activity.
.The Soviet Union and China had their disillusionment with frenzied central plans.We gained in agriculture in the early plans and were nimble to switch to economic reforms in the 1990s. Centralised beaurocratic copy book exercise have been known to be  high in meticulousness and low in informed imagination.Aayog or commission ,in today's flood of statistics we need consummate economists and thinkers who can see the future more clearly than many.Should the states feel diffident over central plans the finance commission must find out solutions .This is far better than reworking plans.

Judicial selections

  The President has given assent to the 121st constitutional amendment bill on selection of judges to the SC and higher courts. For decades we had the judiciary having the final say in appointing its judges ,but now the executive would have the upper hand.Strangely though ,the change has come about when both these august institutions had been losing as much sheen as the other.Whether the amendment would be challenged in the courts remains to be seen.
      The US Supreme Court appointments are being done by the executive for ages now.Our problems rest in the wide spectrum of cases handled by our SC as against preponderance of constitutional issues handled in the US.That makes our higher courts seem more active and mundane and politically very relevant.That being the case we would,over time,be necessarily  swinging between processes of judicial selection, for quite a while yet.

2015- A rerun

1 Jan 2015

The Left govt. in W' Bengal ran one of the finest PDS systems.But what stayed in the minds was its archaic policies on industrialisation and a cadre that had stepped out of its control.The Congress delivered on GDP in UPA I,but subsequently,had the NAC ruining policies and then failed to defend its bureaucracy from a berserk CAG and a wayward CBI. The two years of administrative stasis that followed, wrote it's epitaph.
The BJP contends with the parivar that increasingly believes that it has authorised Modi to carry the sceptre of governance only within the confines of its prescribed hindutva agenda .And given that Modi is wont to plough a lonely furrow, with his ministers watching from the edge of the field ,the BJP rule could in many ways end up like the ones above.
Perhaps BJP is all attention to state elections in order to wrest control of the RS.But that is a long time yet and politics is so unpredictable.A loss of credibility of the government may be quicker coming than improved arithmetic in the Rajya Sabha.

Jan 2015
Global economy stays healthy when it flows freely and in quantity. Post 2008 disparate monetary policies across nations has reduced it to a trickle by impounding through rates / regulation in places where seeds of growth were already sown, only to face a liquidity drought . Later in regions where crops needed weeding and insecticides, as financial oversight and punitive action,it was  flooded with excess money . We thus stood  to lose in both regions .
If we had a vigorous international trade going  each nation  would have added its internally circulating economy to contribute to the central current.Indoing so many of the ills of an over circulated internal economy, would have  found welcome relief , be it  fiscal / current account imbalances or poor levels of  employment.But it is precisely when every nation needs to push for greater trade and economic cross flows, most would get back into a shell of trade isolation. In doing this things can only get worse. Through six long years  both growth and inflation has eluded many a nation.Low oil prices and low inflation today are as ineffective for revival  ! Time that  global trade and economy is freed of economic shibboleths of old and fresh understandings  dared. We need newer global saints of economics.

OPEC and its relevance

Data of past four decades show that elevated oil prices had been co-terminus with surge in global economy. Prior to the economic crisis of 2008,most nations , in particular the advanced economies were doing very well and world trade was flourishing.Global trade indexed at 50 in 1990 improved to 100 in 2000, shot up to 250 in 2008 ,prior to the global crisis.Crude was languishng in the sedantary decades prior to 1990 at around $35 . The decade 2000-2010 was significant for crude oil ,both for its demand and pricing.As global trade peaked so did crude shooting to an unprecedented $145 in end 2007. When global economies sufferd post 2008-09 ,Brent crude fell to $90 by end 2010.Ithas been averaging $115 from then on,till the recent big dip .
During this period,the epicenter of growth was also shifting to nations dependent on oil import and so has the pattern of energy consumption.Insuch a backdrop, prolonged low price of crude portends a stasis in world growth and hence trade .Export driven economies like Brazil ,China ,in the absence of growth led demand elsewhere ,may not be as enthusiastic over the price dip 

Leave it to RBI

dEC 2014

Russia is dependent on revenues from oil and contributes around half of the revenues of the government and makes up for two-thirds of the exports. A study puts the break-even cost of the Russian budget at an oil price of $105 per barrel. Foreign investors are selling their investments in roubles and buying dollars, leading to an increase in demand for dollars vis a vis roubles and the crash of the rouble .The Russian central bank recently estimated that capital flight could touch $130 billion this year.
The immediate lesson for us is to go slow on easing key rates as the returns on government debt are on the higher side vis a vis other countries and lower rates would kindle outward flow of external investments. And that would not be good news on the rupee front.The FM would do well to be patient on key rates and  let RBI use its judgement .

Manufacturing, key to growth

 Hopes of recovery recede with industrial production contracting by 4.2 percent in October, mainly on account of a drag by the manufacturing sector and a dip in the output of capital as well as consumer goods.Manufacturing ,that constitutes over 75 percent of the index, went down  by 7.6 % in October as compared to a dip of 1.3 %  same month last year. We have come to  a strange pass in our economy that neither inflation that  is tending to zero nor any lowering of key rates seem to be holding  much relevance. Manufacturing ,that once was our mojo was abandoned steadily  Chasing the chimera of IT boom, every major manufacturer ,auto,steel,cement ; preferred to put greater faith and attention to founding big scale Financial services / IT.Of course many had found short sustenance in these two areas, while manufacturing languished in relative neglect. In fact Tatas have largely breathed easy of late,because of TCS.

 Nations across the globe are having hiccups in their economies too But they have kept manufacturing as the prime concern,.Germany is showing steady but modest recovery since October ,in this sector.On the contrary,we are shortsighted enough to have embraced tightly a seasonal ally in the likes of IT that has many other suitors.A dipping global economy would further reduce the size and portion of this pie.It would not be easy then  to switch back to competitive manufacturing as it was to jump off it.

UBER

.dEC 2014

Uber came up as a transport enabling service,serving across global cities , from a location in San F'risco ,US. This  " E-Cab " is like what is E-tail to kirana store, .Initiatives as these  has   positives for the customer ,provided they are regulated  for consumer protection.Alert babus of Fin ministry had put their acumen to work,anticipating issues of unaccounted money transfers in Uber.But the story ends there.

        The MHA today advises a ban of this service ,for want of both knowledge and application of mind. The minister of transport feels banning solves no basic problems of passenger safety.Like their fellow mandarins  in  MoFinance, why were those in Home and Transport, not as shrewd and proactive. Had they used their wisdom, the rules and systems guiding the plying of services as these would have been set, to be fine tuned over time .There is a lot more that babus  could be doing , using foresight and experience ,than roll out ban orders. This serves nobody.That said,the way we fall for Apps, we seem to be  more sensitive to technology, than safety of women.

Parivar and BJP

 Every Management  operates through both line and staff functions .So it was with the BJP, that came into being as a  fledgling line unit after the Parivar decided to set up political shop. .It took four decades for the party to be  a going concern . But its umbilical cord remains joined  and as a result the  staff function continues to often prevail over the line responsibilities . Ministers, while striving at  line targets in Delhi need also to act on staff advisory from Nagpur.Their performance is assessed at both of these directive nodes.The PM is no exception . That is the way the organisation is structured and  has remained so, in or out of power. Hardly months into a position of enviable degree of  political ascendancy, the Parivar can not afford  relaxing  its control over  the staff function. Not that it cares less for a possible dent in its party functioning and governance ,but more on zealously guarding the ideological tenets that has been  its raison d'etre.
     It was no different in UPA-II,  where the Congress high command eclipsed its own  PM,pandered to the likes of NAC and took away his power of speech. The Sangh on the contrary, seems to have sanctioned the   PM  little else besides speech ! Despite this ,Dr Singh did manage to animate reforms that are now being followed by the BJP.But when under a  crunch, the Congress abandoned its second term PM . The parivar too may not hesitate to  find a scapegoat , should poll promises wither away in bud.

E-Retail

 Dec 2014
With economic dispersal  came vastly increased centres of earning and population shifts .Services of every kind had to follow the clientele, not only to be relevant but to cut down on cost and time of delivery.The burst in passport service centres became essential as affordability of travel shot up.Now we have a series of economic strata between the rich and the erstwhile common man and the ranges of spendability that comes with it.So too have a range of goods that is tailored to meet the ' Need -Cost Index " of respective niche consumers.Kirana stores are to E-Kommerce as Post Offices are to E-Banking.The products and services offered are different and yet are required to complement each other.The Malls have not displaced the kiranas, only resizing them.Each have a dedicated customer base of their own. So would E-Tailing ,that has accorded greater value to time,a stressed commodity in modern living.If the kirana provides a friendly nod at the shop counter, the Malls provide an overall ambience for spending both time and money and a E-Tail courier dispassionately hands over the parcel to a ardent TV aficionado or one busy earning his keep from home with a computer.If a customer chooses the way he shops,the seller  is equally quick  to improvise his marketing.It is not the other way about.The axiom is that a customer and his goods can never be separated and any clever merchant would keep ensuring that,always.

BJP ,slow on the block

Dec 2014
Like many a   formula Indian movie,new  releases come with different titles but largely unchanged scripts. Congress in UPA-I with lesser seats earned good reputation, but mislaid it in UPA-II, with a far larger tally. It had lost the will to sustain, gave up parliamentary toil  in the LS just on adverse arithmetic, and met its nadir. After creating legislative impasse for close to two years and a campaign high on promises the BJP  reaped its electoral rewards . Six months down the line,the BJP is proving to be no better.It is as much stuck in the mud  in the RS,as the Congress was in the LS .The PM is a rare visitor to the Houses as the party finds greater use for him as a Pracharak . The economy trundles along.The all round lack of progress and direction in the government ,is sought to be muted by it through bringing in one  contentious issue after another. The Opposition  by ,compulsion or design, abets in this ,much as  the BJP had done earlier  What we see now , few months into NDA, could well be a rerun of the last years of UPA-II.We seem to have  miscalculated that the BJP was elected to power because it claimed to be very capable .It appears that we have now received a replacement no better than the  defective Congress.Electorate must henceforth learn to read a political warranty,with greater circumspection.

Obama visit

Dec 2014

.With visits by Putin and a little later by Obama to India, the Nehruvian template of an equidistant foreign policy of the  '60s vis a vis both super powers has proved its sustainability over time .It only needs to be recalibrated. Whereas five decades earlier our fledgling economy got wheat and condescension from the US and armament and heavy industry from the USSR our status today stands far upgraded as an economic power of some reckoning. With this comes greater leverage for bilateral politico-economic dialogues. This would also entail astute diplomatic skills pragmatism and political will from our side.That said Russia has indeed been an all weather friend,while the US had at times been inclined to set a  premium  on its  interests in this troubled sub continent.None of these nuances of  real politk  need to cast a shadow over efforts at a diplomatic resurgence. The era of viewing  external relations through prisms are now passe.The visit of the first ever US president to our shores, closely following  Putin,is proof enough 

Leaders of yore

The nation is in a flux over reviewing the role of the pantheon of leaders who helped shape a post -Independent India. The epochal Nehru anniversary provides an occasion.Itis educative that the assessments on each of them vary.But a larger point is being missed: Gandhi,Nehru and Patel together,represented our national ethos that is incomplete without one of them.Gandhi provided the transcending universal spirit , Nehru the global vision and Patel the nationalist resolve.The political class of this lesser era are sadly engaged in in reconstruing our edifice with a third or more of the basic building blocks missing. Seeking power through division and now pursuing unification to meet the onus of nationalistic governance ,has the Sardar being fondly remembered.Same with the Mahatma :the richness of a secular fabric is now an important backdrop needed for the prosperity theme. Given the current globalised economic 
paradigm, the nation is reconnecting with every world leader of consequence ,re endorsing the Nehruvian vision.The appropriation of tall leaders of the yesteryear,selectively to suit an issue of the day, is to remember none of them wisely.This generation must elevate itself to an extent that it throws up afresh another mutually complementary triumvirate, to deal with the changed times and aspirations.

Growth waits

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Nov 2014
Economic recovery in India still uneven . Key interest rates have persisted far too long . We must admit that RBI interventions on checking money supply as a tool to rein in inflation have elevated the borrowing costs and the global economic stasis, is impacting trade and input costs. It is true that the fiscal picture is getting to be incrementally better but the on going monetary policy has apparently lost traction.The conservatism of RBI to key rates was no different when food inflation was at 16 % to the current 5% plus .The government on its part, must put its house in order . Cosmetic and marginal reduction in fuel prices is fringe decoration Though the government is desirous of an upward GDP targeting, it is yet to marry divergent requirements, both Monetary and Fiscal , to spell out a road map tying policy to specific goals.Perhaps its attentions are more  on bolstering the political environment and less on  the economic one. 
Operating on a different frequency , the RBI too seems obsessed with external economic ambience and rupee  / dollar value .Our IIP has remained below  potential for  long .Banks have the money, but lower rates would help lubricate the gears of transmission of this idle liquidity to assist growth.There is strong case  for easing the rates for the larger goal of boosting our under utilised manufacturing sector .Clearly a " Forward guidance " on monetary policy by the RBI is  overdue

PSU Banks

The Centre’s decision to alter the selection process of CMDs and EDs of public sector banks ,though welcome, may not address the core of the problem.Banks' primary business is in lending. And that needs informed discretion and application of independent judgment . This would call  for integrity ,both in its system and its managers. Over time, the government as owner of PSU banks, has managed to dilute both.It is not enough that these banks are given some degree of freedom in the selection of its CMD /ED. After all ,the top man can not be expected to single handedly counter the shortfalls in a strait jacketed system that  makes up  the entire public sector banking. or for that matter every PSU. One very significant area that has remained unaddressed ,is the employed manpower. This was needing to be optimised for a long while now,but attempts to do so were always cosmetic.A compact manning, besides sharply pulling up productivity would  enhance accountability, of paramount importance in financial dealings.One argument for excess manning is that PSU banks need greater penetration and reach, as part of the government's inclusive policies. But we now see that private banks too are rapidly opening  up  branches in rural locations.They carry with them advantages of both  a leaner staff and tested systems , inter alia , a nodal mode of sanctioning loans armed with pertinent endemic data and  client -base information.The branch manager is left to  largely deal with day to day operations and client servicing.  Basic changes in systems of bank operations with assisted oversight ,must be planned and implemented.There is little reason why PSU banks then can not match productivity and profits of those in  private sector.Parity in PSU bank salaries will then kick in ,as a matter of earned right . As it stands today,a pedigreed CMD  even if painstakingly selected , is no remedy by itself