Tilting at windmills.

In his effort to revive " animal spirits " in the economy our Dear Leader has taken personal charge of the Finance Ministry. So what is his prescription for the rapidly diving economy? In order to boost " one time " clearance for energy and infrastructure projects a Project Clearance Board will be set up on the lines of the Foreign Investment Promotion Board. There will certainly be lots of meetings with delicious lunches and dinners but will anything move without paying huge bribes to politicians and civil servants? Foreign investment has come to a shuddering stop because of the stupid and vindictive GAAR passed in this year's budget which seeks to levy retrospective tax on deals of up to 60 years past and gives coercive powers to tax fellows. In the eleventh 5 year plan from 2007-8 to 2011-12, that is during the reign of the Dear Leader, only 32,762MW of electricity was commissioned as against a target of 62,374MW, barely half. Some 42,932km of highways were awarded till 2010-11 at a cost of Rs 50.72 billion of which 1781km were actually built. Till 2011-12 contracts of 60,396km of highways were awarded of which 2248km were built. As of April 2011 there were 101 discoveries of oil and gas, only 6 could start production. MSN. com, 16 July. There are some 4000 oil wells in the Gulf of Mexico alone and, with increased shale oil and gas production in both the US and Canada, the US will probably stop importing oil from the middle east by 2015. What is really incomprehensible is why we cannot follow the same policies as other countries. China is a repressive state where the government does whatever it likes but the US, Britain, Norway, Canada and Brazil are all democracies. Yet they are able to develop their natural resources almost immediately while we take years and then the price escalation makes it prohibitive for citizens. What is the need for building highways financed by toll when 42000km can built with only Rs 50 billion. Debt of Air India alone is Rs 500 billion and accumulated losses in excess of Rs 290 billion. Top 4 pilots of Air India earn more than Rs 10 million/year, 15 employees earn between Rs 9-10 million/year while 65 earn more than Rs 8 million per year. A total of 335 employees are earning between Rs 6-10 million. HT 11 July. And yet these blood suckers have been on strike for over 3 months for better pay. The only reason precious taxpayer money is being wasted on this cesspit is because, it being controlled by the government, politicians, civil servants and their families can fly everywhere free in first class. Private airlines are being killed with taxes so that they do not take away all the passengers. If Air India is shut down and private airlines allowed to operate freely we would have a thriving airline sector and enough money to build 400,000km of roads without tolls. Imagine how the economy would boom.

Corruption - the only growth story.

The Additional Director General ( Medical ) based at the Indo Tibetan Border Police base hospital in south Delhi apparently spent Rs 500,000 on buying 2 split ACs, 2 LCD monitors, crockery items, candle stand, canvas paintings, sofa set, cabinet etc for his offices. This money was earmarked for purchasing HIV/AIDs awareness tools for teaching paramilitary soldiers. An internal inquiry is underway but we do not expect any results. A fire on 21 June starting on the fourth floor of the Mantralaya which houses Maharashtra government offices including those of the Chief and Deputy Chief Ministers has probably destroyed all files of the Adarsh housing scam in which defence land was given away to a builder to construct apartments. Several Congress politicians are implicated and Maharashtra government is Congress. Anca Maria Neascu, wife of arms dealer, Abhishek Verma met Mr Pallam, Minister of State for Defence, Shekhar Aggarwal, Secretary Defence Production and Vivek Rae, Director General Acquisition at their offices in South Block, New Delhi on 7 December 2011. Both Verma and Neascu are in jail for trying to get Switzerland's Rheinmetall Air Defense AG off the blacklist at the Ministry of Defence and Verma is an accused in the 2006 Naval War Room case. The Bofors case, the mother of all scams, was never solved. Sten Lindstrom, then head of police in Sweden said," The evidence against Ottavio Quattrocchi was conclusive. Through a front company called AE Services bribes paid by Bofors landed in Quattrocchi's account which he subsequently cleaned out...." Big Q, as he was known, is an Italian and was close to Congress. He was allowed to leave India on 29 July 1993 to avoid arrest. The Crime Branch has not found any evidence of misappropriation of funds in the accounts of an NGO run by Kiran Bedi. The case was filed against Bedi by Delhi Police because Bedi is a strong supporter of Anna Hazare who is campaigning for a strong Lok Pal to curb corruption in government. Delhi government is Congress as is the one at the Center. Meanwhile the Shunglu Committee report on the theft of funds at the Commonwealth Games in Delhi has disappeared. The rumor is that Rs 200 billion was enjoyed. Mr EK Bharat Bhushan was transferred from his post as chief of Directorate General of Civil Aviation on 10 July because he was about to publish a critical report on lack of safety at some airlines. He became chief in April 2011 after 14 pilots with forged licenses were found to be flying passenger planes. A file noting made by Mr Bhushan against an airline has disappeared. Seems to be a losing fight against entrenched criminals. It is a wonder that India still survives.

The new carpetbaggers.

As economies all over the world go into recession governments everywhere are trying to cut expenditure. One way is by contracting out to private firms. This restricts spending to a finite amount and reduces government responsibility. Private firms work with contractual labor who cannot form unions, are paid the minimum amount possible and have no rights such as healthcare or pensions. When jobs are scarce people will take anything to survive but often such cost cutting results in poor quality of service, even death. This was amply demonstrated by the security firm, G4S which was given a contract by the British government worth 500 million pounds to provide 10,000 staff for security at the London Olympics. Trying to maximise profits G4S probably waited till the last minute to employ people and kept daily wages so low that it was unable to attract sufficient numbers of suitable people. Yesterday only 17 of 56 G4S staff turned up the Olympic team hotel in Salford in Greater Manchester and 4 of 58 staff turned up at Hilton Hotel in Tyne and Wear, one of whom then disappeared. The British government had to call up 3500 soldiers for Olympic duty and 19 police forces had to contribute officers. The opening ceremony for the games, costing 27 million pounds,has been shortened by half an hour. Created by Danny Boyle, of Slumdog Millionaire fame, it was to feature 10,000 performers, 70 sheep, 12 horses, 10 chickens, 3 cows, 2 goats, 3 dogs and 8 geese and is expected to be watched by 80,000 viewers and 16,000 athletes. In 2009 an aboriginal man died of heatstroke while being transported in a G4S van in Australia and in October 2010 a 46 year old Angolan man, Jimmy Mubenga died when he was restricted by G4S staff inside a British Airways flight while being deported from Britain. No one has been prosecuted. US private security firm Blackwater has been accused several times of shooting innocent people in Iraq and Afghanistan. Barclays Bank has just been fined $453 million for fixing Libor rates over many years and, even now, HSBC Bank is being questioned by the US Senate for allowing money laundering, between 2007-8, because of poor supervision. JP Morgan Chase has admitted to losing over $4 billion in trades of Credit Default Swaps at its London branch. Glaxo has just been fined $3 billion in the US, $1 billion in criminal fines for not reporting side effects of drugs and $2 billion in civilian fines for off label use of drugs on children. Companies resort to cutting corners to increase profits leading to increased shareholder returns which leads to millions of dollars in bonuses for managers. These are the new carpetbaggers. Only they are in suits and ties and real smooth.

The same person.

A recent Asia edition of Time magazine had a cover picture of our most revered Prime Minister with " Underachiever " printed in large letters across it. Now a British newspaper, The Independent has printed an article on our Prime Minister titled " India's saviour or Sonia's poodle ". Congress fellows are frothing in the mouth at the perceived insult saying that he is not to blame for the dire condition of the economy because coalition partners in government are not cooperating with reforms. They point out that he reformed the economy in 1991 and that he forced the passage of the Indo US nuclear deal by threatening to resign in 2008. The government won the confidence vote in parliament with the support of BJP MPs after the communists withdrew support. The BJP might have calculated that this would put Congress in their power in the year before general elections in 2009. In fact the Congress trumped the BJP by massive bribery of the electorate by forgiving all loans to farmers, reducing interest rates stimulating sale of consumer goods, starting the MNREGA scheme which is handing money to the rural poor for doing nothing and increased salaries of useless civil servants by 80%. This humongous injection of money into the economy assured Congress victory and resulted in uncontrolled inflation and soaring fiscal and current account deficits resulting in the fall of the rupee. In order to somehow cling onto power after elections the Congress resorted to further bribery of other parties by creating 47 ministries with 121 departments. No organisation can function with so many department heads so all work came to a standstill. Each politician has a different compulsion and with so many snouts in the trough there was no control. If Mr Singh is such a hotshot economist as the Congress creepy crawlies make him out to be he should have foreseen the consequences of his actions in 2008. If he resorted to such waste of public finance knowingly just to win the elections in 2009 then he willfully committed a serious economic crime against the country. That surely makes him, not just a poodle, but a traitor to his country. If he had no clue as to what he was doing then he is more than an underachiever. He is an ignorant pretender who has sneaked in through the Rajya Sabha and is totally unfit to lead India. Either he knows his subject or he does not. You cannot have it both ways. However, the biggest charge against him is that he presided over grand larceny and did nothing. If he had any honor he would have gone. But by hanging on he has made himself an accessory to all the crimes. Will he be proud when he sees Suresh Kalmadi representing India at the Olympic Games? Shameful.

There is no way out.

Our most revered Agriculture Minister, speaking recently at a rally of gram panchayats, said," Improving the well-being of farmers is difficult unless agriculture sheds come of its population. At least one member from the farmer's family should seek livelihood opportunities outside agriculture." That should be no problem at all. According to the Labor Bureau unemployment rate last financial year was 3.8% compared to 9.4% in 2009-10. Of this 48.6% were self employed, 19.7% were wage or salary earners and 31.7% casual labor. The National Sample Survey Organisation puts the unemployment rate for 2009-10 at a minute 2%. Director General of the Labor Bureau, DS Kolmakar said," Our unemployment level is much better than that of other countries like US, Spain and South Africa." Anything below 4% can be considered as full employment because there will always be some people who have stopped working voluntarily, for instance women stop working to have babies and others to prepare for entrance exams to management studies or to take the GRE to emigrate to the US. Hence no one should have any problem finding jobs. In fact, we should expect a mad scramble by companies to find employees and every Indian should be middle class. Trouble is that most farmers are illiterate and job opportunities are limited. Vast numbers of rural poor are migrating to cities every year but, being illiterate, they can only find manual labor. Property prices and rents are so high in any city that they are forced to live in slums. But living in wretched conditions in a shack with no electricity, water connection or bathrooms is not free. Goons working for local politicians extract rent money by force although the land belongs to the government. Travel is expensive so they have to find work near their residence which may not always be possible. Any illness means loss of earnings and expensive medicines leading to starvation. It is not surprising that farmers are not keen to look for work outside their villages. Since the MNREGA scheme was started finding casual labor and domestic servants has become almost impossible. Wages have risen and one would expect more rural poor to look for work elsewhere but living conditions are so wretched that they do not dare. Instead of just handing out money the government should pay these people where they are to build roads, sewer systems, waste treatment plants, electricity generation from renewable sources and telecom infrastructure. That will create jobs and opportunities for setting up small scale industries. The central government spends Rs 591.43 billion on 34.1 million employees. Get rid of half of these useless fellows and spend the money on useful work. Since unemployment is vanishingly small they will have no trouble finding jobs. Is the revered minister listening.

The new illiterates.

Passports in India have gone biometric which means fingerprints and retinal scans of everyone to be taken. In previous years you filled up a form, stood for hours to pay the fees and then stood again for hours to submit the form with the receipt of the fees. At least there was no confusion. Lots of touts used to hang around outside offering to fill your form and submit it on your behalf for Rs 100 but educated people like us just ignored them. Now, however, even we cannot submit passport forms without help. You have to download the form using Adobe Acrobat Reader 9 or above, fill it and then upload the form in XML format but not in PDF. Once that is accepted you will be shown available dates and can choose a suitable one. You will then download the information, print it out and present yourself at the correct passport office 15 minutes before the appointed time with appropriate documents. Since 90% of Indians do not possess a computer and 50% do not know enough English this is impossible but, even for us so called educated people this sounds like gibberish. Every school has computer classes so children as young as 5 are familiar with these infernal machines but for older people computers are incomprehensible. Trouble is that if you ask anyone the response you get is that it is very easy. Excuse me. A porter, totally illiterate, at a hospital can stitch an open wound, draw blood and set up an IV line, he finds it easy. Can you? A lady is fluent in written and spoken in Fulani, she finds it easy. Can you? It is stupid and infuriating. Sure enough touts have set up business. Only now they are sitting in offices and charging Rs 500 for filling up your form and getting you an appointment. Yet it could be made much easier. For instance there is no need to do anything to this blog. Just click on the " publish " icon at the top of the page and it is instantly published. The same could be done with the passport form but, this being India, it has to be made so complicated that it becomes impossible. Just to harass people. Anyway, we recently obtained Adhaar cards, which have photographs, prints of all 10 fingers and retinal scans and were supposed to do away with every form of identity problem. Why can they not get all the biometric details from the Adhaar fellows which will save them and us a colossal amount of time and grief. All it would need would be to print out a form, fill it, give your Adhaar number, attach relevant documents and submit it at a post office with the fees. Simple. However, knowing our civil servants they would probably print your daughters details on your passport and you would running around forever to get it rectified. Recently they had to sort out the Railway Tatkal ticketing system to get rid of touts. Now the touts have shifted to passports. Do they do it on purpose?

Do we really deserve them?

Freeloading journalists frequently say that we deserve the politicians we get, meaning that we are responsible for electing them so we must suffer the garbage we have. No one deserves a Mugabe or a Chavez, although they would claim to be legitimately elected, but anyone opposing them would disappear. Surely India with its strict Electoral Commission is better? Seems that out of a total of 4896 MPs and MLAs at least 1450 or 31% have serious charges against them. Of these 641 have serious criminal cases such as rape, murder, attempt to murder, kidnapping, robbery and extortion against them. Of the MLAs 6 have been charged with rape, 140 with murder, 350 with attempted murder, 145 with theft, 90 with kidnapping and 75 with dacoity. TOI 14 July. So why do we elect this charming lot repeatedly? Because 1. our stupid laws allow criminals to stand for election even when in prison, 2. our noble judges allow cases to drag on infinitely without punishing them, 3. criminals love politics because they are with their own kind and feel safe and 4. political parties love criminals because they can provide black money and the goons to beat up opponents. However, this does not apply to the US where laws are applied strictly and criminals are swiftly put away for prolonged periods and any party knowingly putting up criminals as candidates will be annihilated. But even here election results are difficult to explain. With women making 53% of the population one would have thought that Hilary Clinton, with her qualifications, would walk into the White House. Instead Obama, a gasbag, got elected and is now neck and neck with Mitt Romney. What is Romney's message that makes him so popular? He does not have any message except that he will cut taxes for the rich and abolish Obamacare, as the new healthcare law has been called, even though it is the same law that he himself enacted when he was the Governor of Massachusetts. Romney says that giving more money to the rich will enable them to invest more in the US and increase jobs. But will they? How will he prevent a rich man from opening a factory in China and importing cheap goods into the US? The rich man gets richer, jobs are created in China while the US gets deeper into debt. The uniforms for this year's US Olympics team have been made in China by Ralph Lauren, an American company. It was the Bush tax cuts that resulted in the present economic crisis yet large numbers of ordinary people still support tax cuts for the rich. We have seen countries where a small number of people were extremely rich and led a pampered existence while the population remained poor. Soviet Union was one such. So can we say that the Republicans are closet communists and Americans truly deserve the politicians they get?

Banditry is also private enterprise.

One of the ways our most revered Prime Minister has promised to reignite the economy is by boosting infrastructure which is dismal in India. However, the government is bent on the failed Private Public Partnership model wherein a private company is given the contract for building a stretch of highway and in return is allowed to collect toll for 20-30years. In the past companies bid aggressively, even paying the government millions of rupees, to be awarded such contracts. Trouble is that there is hardly any traffic on the so called highways for these companies to get their money back, let alone make the kind of profits they were dreaming of. Petrol is Rs 68/lit, as opposed to Rs 38/lit in the US, because of extortionate taxes and paying toll every 25km makes any journey extremely expensive and irksome so people prefer trains or buses. The National Highway Authority was unable to find any bidder for even 100km against a target of 1500km at its recent auction. TOI 11 July. So in an effort to force the issue the minister is asking banks to lend more money to construction companies. This means that public sector banks will be saddled with even more bad loans and will need to be bailed out by the government. Why not spend the money directly in building highways without any toll? It will pay for itself by increased tax collections from increased business activity, as China has done. The reason India is poor is because of the stubborn refusal of politicians and civil servants to learn from what is happening elsewhere. In Britain the Private Finance Initiative has been an absolute disaster. Companies running rail services have such confusing pricing on tickets that commuters do not understand and if anyone is caught with a wrong ticket he is heavily fined. Bus companies have shut down unprofitable routes in rural areas where they are essential. The NHS, which was the pride of Britain, has been ravaged by cuts while administrators award themselves 200,000 pound salaries. A 38 week pregnant woman was sent home for 4 days over the weekend, even though blood flow to the baby was seriously restricted, because there was a shortage of staff. The baby died. Kane Gorny, a 22 year old man, was so thirsty in St George's Hospital that he dialed 999 to call the police. When police arrived the nurses sent them away saying that Gorny was alright. When he died he had lost one third of his body weight. Private companies concentrate on maximising profits to increase shareholder dividends and bonuses for the managers. They are fine where there is competition as in telecom but even here they must be strictly monitored to prevent cartels forming. No private company should be allowed into a monopoly situation as in roads, railways, airports, water or power transmission. They will kill the people.

Worse than China.

In the last few days there has been an uproar over comments by our most revered Home Minister in which he reportedly said that the middle class is ready to spend Rs 20 on an ice cream cone but unwilling to pay Re 1 more for a kilo of rice or wheat. The minister was " shocked and disgusted by the deliberate distortion " of his words and stressed that he said," We are prepared.....". He is so modest at including himself in the middle class but he forgets some basic facts. 1. Ice cream is optional and maybe omitted from the diet but wheat and rice are essential elements of the Indian diet, especially the poor who can no longer afford chicken, meat or milk because of inflation and 2. Ice cream is loved by children who can be kept happy by making it at home but wheat and rice have to be bought. China has brought inflation to below 3% while we struggle to survive with CPI at over 10% but our millionaire politicians cannot comprehend what we are complaining about. However, Bengal is now the leader in sheer brutality. A woman called Pinki Pramanik was accused by another woman of actually being a man and raping her. Pinki was arrested and says that she was forcefully examined at a private hospital where the police tied her arms and legs apart. She has been released on bail which would seem to imply that the charges are false and she is indeed a woman. Instead of announcing the results and apologising the Sports Minister of Bengal, Madan Mitra has accused her of selling land leased to her free of cost by the state. HT, 12 July. Also in Bengal, a 10 year old girl, Punita Mistri was forced to lick her own urine as a punishment for bed wetting at Patha Bhavan School at Shantiniketan. The distraught girl is now refusing to go back to school for fear of being mocked by her classmates. Registrar of Visva Bharati, Mani Mukut Mitra and school principal, Bodhirupa Sinha visited the girl's home but offered no apology. Instead the school has complained to the police who are applying pressure on the girl's father, Manoj Mistri to return her to the school. Clearly it is a blatant attempt by the authorities to trivialise the whole incident so that the controversy would die down. If teachers are so brutally insensitive towards a little girl what are students going to learn? It is not surprising that Bengal leads as the most barbaric state. When a 37 year old woman was gang raped on leaving a nightclub on Park Street in Kolkata on 5 February the Chief Minster, Mamata Banerjee ridiculed the story as a " conspiracy to malign her government " and then transferred the Joint Commissioner of Police ( Crime ), Damayanti Sen for proving that the woman had indeed been raped. Where the leaderene leads others will follow. Barbarians.

Shades of dictators.

The standoff between the Muslim Brotherhood in Egypt is getting more interesting by the day. Mohamed Morsi was elected President on 30 June but before he could be sworn in the Supreme Constitutional Court, the highest court in the land, declared 30% of seats in the People's Assembly, which is the lower house of the Parliament, invalid. The army promptly dissolved Parliament and said fresh elections will need to be held after a new constitution is written. The Supreme Council of the Armed Forces, which has been in power since the fall of Mubarak, also gave special powers to itself which must be guaranteed in the constitution. Without a Parliament to pass laws Morsi becomes toothless so in a challenge to the army he recalled Parliament couple of days ago. The Parliament did meet but only for 5 minutes, deciding on challenging its dissolution in court before adjourning. Yesterday the Constitutional Court ruled that its previous order stands and Parliament cannot meet. Opponents of Morsi, who is from the Muslim Brotherhood, say that he was trying for a constitutional coup and that his action amounts to contempt of court but the Speaker, Saad Al-Katatni said that Morsi has not violated court order. Muslim Brotherhood, as the name suggests, stands for a pan Islamic Caliphate stretching from Spain to Indonesia. This should be music to rulers of the Gulf states, especially Saudi Arabia which runs on a strict interpretation of Sharia law. The King is referred to as The Custodian of the Two Holy Mosques signifying his control over Makkah and Medina. While using religion as a means for holding on to power the royal family does not allow any imam from becoming too popular or powerful so they will be immensely suspicious of the Brotherhood, given its history of violence. It tried to assassinate Hafez Al Assad of Syria in 1982 in Mali, following which Assad reacted by attacking Hama in which some 10-40,000 people were killed. Anwar El Sadat, President of Egypt, was assassinated on 6 October 1981 by Islamic Jihad in a plot with Al Gamaa al-Islamiyya, an offshoot of the Brotherhood. Already people are coming to the Presidential palace in Cairo and leaving notes with requests for help just as you see on TV in Saudi Arabia. There the King holds audiences for ordinary people who approach the King one by one, kiss him on the shoulder in a mark of respect and hand him a little note which is passed onto assistants standing behind. So would Morsi like to have the powers of a king and become a supreme leader backed by the Brotherhood or would he like to become a passive dictator backed by the army with plenty of pomp and ceremony but without true power like Zardari of Pakistan. The middle east is poised to explode. It will be fun to watch as long as the explosion stays there.

Don't struggle against quicksand.

With inflation in double digits, fiscal and current account deficits out of control there is nothing the RBI can do to support the plunging rupee which is trading at 55.50 to the dollar. A falling rupee increases the price of imports, especially oil, and adds to inflation preventing the reduction of interest rates. So, why is the RBI unable to sell dollars to bring the exchange rate down? Taimur Baig and Kaushhik Das, economists at Deutsche Bank, say that of the $286 billion in foreign reserves with the RBI, $2.8 billion are held by the IMF, $4.4 billion are held as Special Drawing Rights at the IMF and $25.6 billion is in gold. ET, 4 July. Of the remaining $253 billion $14.2 billion have to be deducted for derivative bets by the RBI leaving $239 billion as " usable reserves " which is equivalent to just 6 months imports. Which explains why our previous Finance Minister, who has been kicked upstairs to be candidate for President, devised the General Anti-Avoidance Rules in the budget. This measure was mainly designed to target Vodafone which bought Hutch-Essar for $11.2 billion through a shell company in Cayman Islands and thus avoided a withholding tax of $2.6 billion. Actually it is the seller who should pay tax on accrued gains but the government, unable to trust tax officers who may just forget for a hefty bribe, has made it mandatory for the buyer to withhold tax and submit it to the tax office. Vodafone filed for relief and won at the Supreme Court. After all $2.6 billion is a hell of a lot of money. To override the Supreme Court the Congress devised this law, known appropriately as GAAR, which seeks to reexamine every deal going back 60 years. So, to hide corruption among civil servants the politicians bring in a bad law and then to plug a loophole in that law it brings an even worse law. Naturally foreign investment has dried up as foreign companies have taken fright and the flow of dollars has dried up hitting the rupee. With general elections in 2014 the Congress desperately needs money to finance all the social schemes it started but without increasing the deficit. To that end it has decided to levy taxes on every kind of service that it can find. From 1 July a service tax of 3% is being levied on booking package tours abroad through travel agents. Already airlines are heavily taxed and airport charges at New Delhi airport have been increased by 346% on outgoing, incoming and transiting passengers making it the most expensive airport in the world. Now Indians are being asked to pay another 3% on expenses which they will incur in a foreign country and which are being taxed there. The idea maybe to prevent people from going abroad so as to save foreign exchange and force them to spend in India. The result is that airlines, already incurring huge losses, will probably go bankrupt. The economy is in quicksand and the Congress is thrashing around for a giveaway budget next year to win in 2014. Disaster looms.

What is in a trillion!

Seems that state power utilities have racked up debts of over Rs 2 trillion. Apparently last year state owned power companies in 5 states, Tamil Nadu, Madhya Pradesh, Punjab, Rajasthan and Haryana had their debts restructured by banks to the tune of Rs 300 billion. Now this larger debt will be restructured as well. Already Rs 1.9 trillion of debt, of which corporate debt was Rs 762.51, has been restructured this year. About 18-20% of such restructured debt turns into Non Performing Assets or bad loans. State Bank of India already has Rs 400.8 billion of NPAs on its books. The power companies are in such a mess because political parties promise free power to farmers and slum dwellers to win elections. This only helps rich farmers who have electric supply in their homes. They use free electricity to run water pumps for hours drawing enormous amounts ground water for irrigation. Thus power distribution companies run up large debts while the level of ground water keeps falling raising salinity in the water and even raising levels of arsenic in the water. Farmers do not pay income tax so a lot of politicians describe themselves as farmers showing all their income from farming. Thus taxpayers are transferring money to politicians to win elections as well as to add to their wealth. Six months back a RTI application revealed that 6 serving MPs and 399 retired MPs, both dead and alive, owed Rs 70 million in unpaid telephone bills to MTNL, the public sector telecom service provider in Delhi. This in spite of the fact that MPs are allowed 150,000 free calls a year. TOI, 21 June. In reply to a recent RTI application MTNL replied that " No parliamentarian is found for violation of any of the norms ". Summer is especially torrid in Delhi with temperatures rising to 45'C. Water is supplied for just one hour everyday throughout the year but every summer there are days when there is no water at all. Water tankers take advantage of the desperation of residents by charging whatever they desire. Naturally government fellows are deeply involved. Delhi Jal Board officials at RK Puram were asking for Rs 2000 for one tank full, which would be 1000 liters, half of which to be paid in advance and half to the driver of the tanker. In Vasant Kunj the rate was Rs 500 for half a tank. HT, 4 July. The Olympics are just 2 weeks away. As usual we will see athletes being outnumbered by politicians and civil servants. In the past athletes were made to sleep on the floor while these scum occupied all the beds. Begging and criminality go hand in hand. Sadly, most of our politicians are criminal beggars.

Addiction is built in.

The Guardian Weekly of 15 June carries a story of a man who had bariatric surgery to lose weight in England. Two thirds of his stomach was removed and 8 meters of small intestine was bypassed so that he is left with only 1.5 meters thus decreasing the area for absorption of nutrients in food. He is able to eat only small quantities of food because larger amounts make him vomit as the small stomach is unable to cope and he has to constantly watch what he eats otherwise he will develop deficiencies of key vitamins and minerals. Unlike gastric banding his operation is permanent so he will have to cope with these changes for life. His weight has dropped from 195kg to 100kg. For the first time in a long time he is able to tie his shoelaces, take his children for rides on his scooter and rest his laptop on his lap instead of on his abdomen. On a recent holiday in Egypt he felt brave enough to take off his top in public although that maybe because Egyptians, especially women, are fat. Before the operation he had back problems, high blood pressure, lymphoedema in his legs, cellulitis and such severe sleep apnoea that he was waking up 10 times at night and doctors had to give a machine that blew air onto his face to help him breathe. He would get short of breath walking 13 steps to his bedroom. The improvement in his condition seems remarkable and one would expect him to be ecstatic but he is depressed. Apparently depression, alcoholism and suicide are not uncommon after such surgeries. Political correctness driven by feminism has restricted genuine discussion about severe obesity. While feminists are vehement in their criticism of thin models calling them anorexic and a bad influence on young girls they try to celebrate obesity by holding beauty contests for obese women and describing the word " fat " as an abuse. They deny that fat people are greedy and say that it is not the quantity of food that makes people fat but their genes. If quantity of food does not make you fat then bariatric surgery, which reduces intake, should not work. Yet the same feminists are vehemently against smoking although, in today's world, obesity causes many more diseases than smoking. Why do people get so obese? This man says," When I get up I have toast, six or eight pieces, white toast, butter and jam. I'll have Coke or Pepsi in the morning, a two liter bottle, probably half of that for breakfast. I enjoy every bit of food I eat, but then I feel guilty and, then the only thing that will make me feel better again is eating, then I feel bad again." This man is describing symptoms of addiction. Seriously obese people are food addicts and that is why they get depressed after surgery, because of withdrawal. Human beings are addicted to food, smoking, alcohol, drugs, gambling, shopping, sex and even video games. Maybe it is something about being human that makes us prone to addiction. The problem is we cannot stop being human.

Hot air not enough.

Commenting on an interview with our most revered Prime Minister a foot-licking editorial on HT online today says," Mr Singh has, with his acuity as an economist, already identified the steps needed to restore investment climate." Wow, really? So, what are the magic steps that our Great Leader identified? 1. Taxes will be fair and transparent for all classes of investors. What about the largest investors, the people, dying of extortionate taxes on Speed Post to hospitals to passports? Taxes add to inflation and reduce demand. 2. Government borrowing crowding out private investment will be curbed. How? It was your government that increased salaries of millions of useless civil servants by 80%, started the inflationary MNREGA scheme which has idled rural labor by paying them Rs 162/day for 100 days a year for doing nothing and forgave loans to farmers resulting in the soaring fiscal deficit, uncontrolled inflation and the collapsing rupee. Money wasted can never be reclaimed. 3. Household savings will be weaned off gold for more fruitful deployment of capital markets. The reason people are buying gold despite such high prices is because they do not trust you. Money in banks loses value because the rate of inflation is higher than the interest it earns and stock markets are completely manipulated by crooks. Increasing taxes on gold will only encourage smuggling and give birth to another Haji Mastan. Remember him? 4. The government will lower its reaction time to business proposals. The reason it takes so long is because your old friends, the bureaucrats, will do nothing without a hefty bribe. That is why your government has used every trick in the book, from beating sleeping protesters to death in the middle of the night to outright slander of civil society activists, to prevent a strong Lok Pal from coming into existence. 5. The emphasis on infrastructure spending will be renewed, which means more joint ventures with industry. The PPP model is a disaster because of taxes and bribes. Companies constructing roads are desperate to sell out because frequent tolls keep cars away. In other countries cars outnumber trucks and buses by 10 to 1 while in India it is the opposite. Delhi Airport is the most expensive in the world. Freeport AG, the world's second largest airport operator, is thinking of selling its 10% stake in Delhi Airport. Meanwhile Airport Authority earned Rs 29.35 billion from taxes. Give us specifics, facts and figures, on how you will accomplish all that you say. We will role up our sleeves, put our shoulders to the wheel, grit our teeth, strain our sinews, use the sweat of our brows, all these are horse dung. Tell us how you will reduce fiscal and current account deficits, control inflation and reduce government spending. To do that you will have to stand up and be a man. Can you?

Only a big stick works.

Glaxo Smith Kline pleaded guilty to 3 criminal charges in the US and has agreed to pay $3 billion in fines. The charges involved Paxil, Wellbutrin and Avandia inviting a criminal fine of $1 billion. Apparently Glaxo illegally promoted use of Paxil, an antidepressant, in children which was an off-label use and helped to publish an article in a medical journal which misrepresented data from a clinical trial. It also failed to report heart risks with Avandia. NY Times 3 July. The remaining $2 billion was for civil settlement for marketing practices in the sale of its blockbuster asthma drug Advair and for overcharging the government. In May, Abbott Lab settled for $1.6 billion over marketing Depakote and Johnson and Johnson could pay $2 billion for off-label use of the antipsychotic drug Risperdol. However, large as they seem these fines are not that much as Avandia racked up sales of $10.4 billion, Paxil $11.6 billion and Wellbutrin $5.9 billion. In India companies regularly dare the government. Cable operators were supposed to switch to digital set top boxes in the 4 metro cities from 1 July because they were cheating both broadcasters of their share of revenue and the government of taxes by under reporting the number of subscribers they had. However, come 1 July cable operators howled that they were not ready so the date has been postponed for 4 months allowing them extra time to cheat. Millions of set top boxes sit rotting in warehouses. Banks were charging merchants 2-3% commission for every sale on debit cards, the same as charges on credit cards, although there is no risk or delay in payment on debit cards as there is with credit cards. The RBI ruled that banks should charge 0.75% on sales of up to Rs 2000 and 1% on sales above that amount but come 1 July banks pleaded for 2 more months because they had to make changes to their computer programs and agreements with merchants which is rubbish because merchants will be only too glad to pay less in commission. Vodafone does not answer emails, Tata Photon still has a policy of validity of 1 month on its internet connection, which means that if you forget to recharge by the due date you lose the unused bytes left in your account and Tata Sky suddenly increased charges on some English channels from Rs 5 to Rs 20 to force subscribers to opt for packages wherein various channels are bundled together. Bundling of channels means that subscribers pay for channels they never watch while advertisers never know the true number of viewers for every channel thus wasting enormous sums of money on commercials nobody sees. You cannot transfer your cell phone number from one part of the country to another although companies have accepted " portability " after resisting for 3 years. These policies are adopted by every company showing that they are operating as cartels and that there is no competition. Foreign companies quickly learn to cheat, something they would never do in their home countries. No doubt politicians and civil servants are raking in the moolah.

Sabre rattling or Russian roulette?

Syria is sliding inexorably towards a civil war. Left to themselves it would probably have settled by now. Either the regime would have won as the Iranian regime did after the stolen elections of 2009 or Assad would have fled as happened in Tunisia when Zine El Abidine Ben Ali scarpered to Saudi Arabia on 14 January 2011 or Assad would have been killed as happened to Nicolae Ceausescu on 25 December 1989 in Romania after a short revolution. However outsiders have been interfering from the very beginning. On one side are the 74% of Syrian people, the Sunnis supported by Saudi Arabia, Qatar and Turkey with the CIA offering tactical advice. On the other side is the ruling party comprising of 12% of the population, the Alawites, who are Shia, supported by Russia and Iran. Terrible atrocities are being committed by both sides as is to be expected from the ancient hatred between Sunni and Shia and between Arabs and Persians. Both sides have a lot to lose but Iran has the most to lose of all. Apart from the Hezbollah in Lebanon, listed as a terrorist organisation by the west, Syria is the only nation friendly to Iran which is under terrible pressure due to sanctions imposed by the US over its nuclear program. Its economy is in terrible shape and the government is finding it impossible to sell its main export, oil as EU sanctions have kicked in since 1 July. Iran has apparently lost $10 billion in revenue this year already. It has reduced oil production by 1 million barrels/day but is still having to pump out 2.8 million barrels/day to protect its wells from damage. It is able to sell only 1.6-1.8 million barrels/day and then at throw away prices. NY Times, 5 July. Tankers are being painted over and given different names to prevent them being recognised as Iranian. About two thirds of Iran's tankers are being used for storage of 40 million barrels of crude while 10 million barrels are stored on land. Crude oil is highly toxic and cannot be dumped without producing enormous environmental damage. Iran has today said that it is thinking of complaining to the International Court of Human Rights, a sign of how desperate and vulnerable it feels. However, Persians are an ancient and proud people so it is hard to predict how Iran will react if pushed against the wall. Attacking any other country's vessel will invite a swift response from the US and Israel which is looking for any excuse to bomb the nuclear sites. But Iran could pour oil into the Gulf and set it on fire claiming it to be an accident. That would produce the mother of all disasters and stop all shipping from the Gulf immediately sending oil prices into the stratosphere. Have the Saudis and Americans considered every eventuality? Very doubtful.

Them and us.

Two days back, after 3 days of protests, the government of Shifang in the southwest of Sichuan province in China stopped the construction of a copper alloy plant. The locals were protesting because they feared that the plant would poison the environment. After melamine in baby milk powder and the recent forced abortion of a woman 7 months pregnant no one in China has any faith in official reassurances. Yesterday 3 people were killed in Peru for protesting against Conga mining project by the US based Newmont company. This is an open cast gold mine 3700 meters or 12140 feet above sea level which involves the drainage of 4 lakes high in the mountains which supply water for drinking and irrigation to the local populace. The company claims that the water will be drained into reservoirs built by the company and all environmental risks have been considered. The government of Peru says that it will suspend freedom of assembly in the region. In India people around the Russian built Kudankulum nuclear power plant in Tamil Nadu are protesting against the start of the plant because they fear that it will poison the sea and the fish on which they depend for livelihood. They also worry that it will be unable to withstand a tsunami like the one at Fukushima. The Indian government has responded by charging 6800 people with " sedition " and " waging war against the state " and has sent psychiatrists to " get a peek into protesters' minds ". HT 5 June. A recent report by Russian nuclear safety experts says that Russian reactors are under prepared and have 31 " serious flaws ". There is a nexus between politicians, civil servants and big business which sees the people as cattle, to be fed during elections and then milked for ever. It is the fault of the people to keep voting for their enemies but given a choice between one set of scoundrels against another set of villains what choice do they have? Elections are won by promising free handouts which are received gratefully by the hungry, naked aam aadmi not understanding that they will have to return much more in the form of taxes on everything they may desire. Thus an Indian flies once every 10 years while an American flies 1.8 times a year on average. This is because of the stubborn Public Private Partnership model which allows a company monopoly rights to tax people from building roads and airports. The same model called Private Finance Initiative has been a disaster in the UK where rail fares, energy costs and water charges have soared while services have declined. Yet David Cameron is bent on privatising the NHS. This Westminster form of government is a failure. We urgently need citizens corporations to hold the scoundrels to account.

Are they good or are the others bad?

Every commentator is using superlatives about the Spanish team's victory over Italy in Euro 2012 final on 1 July. Some are saying that this is the best national team ever to grace the world stage. They should know because of their experience in the game and long experience of watching competitions. However, you are only as good as your opponents allow you to be. No doubt the Spanish team plays divine football but is their superiority due to the weakness of other teams? Spain's main strength lies in their team being drawn mainly from Barcelona and Real Madrid and although there is great rivalry between the 2 teams once the players develop an understanding they become a unit. Contrast this with Brazil most of whose players play overseas, mainly in Europe, where the money is. The players have to fly a long distance back to their country and have short time to get over jet lag and practice together before pulling on the golden yellow jerseys. The Premier League in England is recognised as the best league in the world yet England were glad to lose on a penalty shootout and not be humiliated in open play. English clubs are able to buy the best players from all over the world which makes them strong and wonderful to watch but it also means that few English players get the chance to play with top players and those that do are playing with foreigners, very often under a foreign manager, which means that they are unable to develop the kind of understanding that Spanish players seem to possess. International tournaments are held in the summer after the end of the national season which means that top players have already played some 60 games in their league, cup and Champions League fixtures. Players are tired and some may be nursing niggling injuries as Schweinsteiger was said to be suffering from. Players do not earn from playing for their countries but from the clubs that have signed them. Top players are paid 120,000 pounds a week which would be Rs 1 crore or 10 million in Indian currency. Clubs are owned by wealthy businessmen who see players as investment and are angered if players are injured playing for their countries. Carlos Puyol was sent for a knee operation just before Euro 2012 after playing the whole season with his injury for Barcelona which meant that he missed the tournament. All this means that we do not see the best of these highly talented players and very often internationals tournaments are disappointing, especially for neutrals like us Indians. Del Bosque, Spain's manager was being criticised for playing 6 across the midfield without a recognised striker up front but after beating Italy he is being hailed as a genius. Maybe the opposition was just not good enough. Still champions are champions so congratulations Spain.

Indian or not?

Ever since the Prime Minister has taken over the Finance portfolio, following the elevation of the Finance Minister to be candidate for President the Sensex has jumped by 500 points or so. Freeloading journalists have built up the Prime Minister's credentials as a World Famous Economist who was responsible for the reforms in 1991 although there is considerable evidence that this is incorrect. If he is such a hotshot economist why has he allowed mindless social schemes to be started encouraging fiscal deficit, roaring inflation and a diving rupee? Since yesterday tax has been imposed on every service including hospitals and postage. This combination of extortionate taxes and uncontrolled inflation is reducing the middle class to poverty, reducing demand and will result in depression. For 6 years journalists have been complaining that the Dear Leader does not say anything preferring to answer all queries with a Rathore smirk. The reason maybe that he does not have a clue or that, not having a power base of his own, he prefers to hang on to his kursi by genuflecting to Ms Sonia Gandhi and agreeing to her every whim however suicidal it maybe for the country. That entitles us, as citizens, to ask is Ms Gandhi an Indian? Has she formally renounced Italian citizenship and has a paper to prove it? This is not being nationalistic or anti foreigners. President Obama showed his long birth certificate to prove that he was born in the US and thus entitled to stand for president. But this is more important than a question about constitutional propriety. A commercial pilot is not allowed to carry a parachute so that he will try his best to save his passengers in an effort to preserve his own life. If Ms Gandhi has indeed renounced her Italian citizenship then her fate is bound with that of this country and her insistence on social schemes maybe construed as altruistic, even if misguided. But if she still retains her Italian citizenship then we would be entitled to question whether her actions are motivated purely by the selfish wish of making her son the prime minister at all costs, never mind the cost to the people of India. The Congress has very cleverly managed to sidetrack any questions regarding Ms Gandhi's nationality by packaging her as the nation's Bahu ( daughter-in-law ) but when the very future of the nation is at stake this sentimental bilge will not wash. We do not want Craxi or an Andreotti to be our prime minister and definitely not a Berlusconi even if our politicians may desire bunga bunga parties. We want proper answers. Let Ms Gandhi show an official document from the Italian government that they have accepted her renunciation of citizenship. Or else she must stand down.

Learn from Korea.

Last week Saudi Arabia extradited one Syed Zabiuddin Ansari wanted in connection with the Mumbai attacks in 2008. Apparently this man was directing the terrorists by phone from ISI offices in Pakistan. He says that in 2005 two Pakistanis, Major Abdurrehman and Sajid Mir, had visited India to watch a cricket match between India and Pakistan in Mohali where the then President Pervez Musharraf was an honored guest. So while this Musharraf was enjoying our hospitality, eating our food and drinking our water his filthy people were here reconnoitering India to find the best spots for slaughter. They then roamed Delhi and Mumbai for 2 weeks with passports bearing false names. So how has the Congress answered this attack on our country? By going on " bended knees " to beg for peace talks and trade. Trade with Pakistan is about 1% of our total trade so we can do without it. Global Attitudes Project conducted by the Pew Research Center between 28 March and 13 April 2012 showed that 60% of Pakistanis consider India to be a bigger threat than the Taliban or Al Qaeda. The Congress has started a direct train link with Lahore, allows open access to Pakistani singers and film stars and has now opened another border crossing. While they hysterically accuse Pakistan of arranging the Mumbai attacks they have bared our chest to further attacks. Yet there is a very successful example of how to deal with rabid fanatics and that is the Demilitarized Zone between North and South Korea. Both Pakistan and North Korea are nuclear armed nations but whereas Pakistan pretends to hold elections to form a civilian government North Korea is an unabashed dictatorship. Yet the DMZ has kept the 2 armies apart for more than 50 years. Although the North Koreans have repeatedly sent intruders across the border into the South there has never been a massacre of civilians as has happened repeatedly in India. Tunnels across the DMZ were discovered in 1974, 1975, 1978 and 1990 which have become tourist attractions. On 26 March 2010 a South Korean warship, the Cheonan was torpedoed by the North, although they vehemently denied it, and on 23 November 2010 the North shelled the island of Yeonpyeong killing 2 South Korean marines. Since the war the South has just ignored the North, while keeping a watchful eye on it, while it has powered ahead with its economy. Dictators like to strut their stuff so the North is mad with hate at being dumped into a corner as its economy slowly degenerates into bankruptcy. This is what we should do with Pakistan. Build fences along the border and lay land mines so extensively that not even a mouse can cross over. Shoot at anything that tries to cross. Then forget about it and concentrate on becoming rich. Sadly since independence the Congress has repeatedly turned victories into defeat and seems set on a course for further massacres. The enemy is within.