The Titanic is Sinking . Can we do something ?


Global Economic Outlook 2013

http://www.conference-board.org/data/globaloutlook.cfm

The global economy has yet to shake off the fallout from the crisis of 2008-2009. Global growth dropped to almost 3 percent in 2012, which indicates that about a half a percentage point has been shaved off the long-term trend since the crisis emerged. This slowing trend will likely continue. Mature economies are still healing the scars of the 2008-2009 crisis. But unlike in 2010 and 2011, emerging markets did not pick up the slack in 2012, and won’t do so in 2013. Uncertainty across the regions – from the post-election ‘fiscal debate’ question in the U.S. to the Chinese leadership transition and reforms in the Euro Area – will continue to have global impacts in sluggish trade and tepid foreign direct investment.

Main results:

  • Across the advanced economies, the Outlook predicts 1.2 percent growth in 2013, compared to 1.1 percent in 2012. The slight uptick is largely due to Europe, which is expected to return to very slow growth of 0.3 percent after the -0.2 percent contraction in 2012. U.S. growth is expected to fall from 2.2 percent in 2012 to 1.6 percent in 2013.
  • In the medium-term, the outlook expects the U.S. and other advanced economies to go some ways toward closing large output gaps – that is, the difference between current output and the level of output an economy can produce in a noninflationary way, given the size of its labor force and its potential to invest in and create technological progress. The current output gap is a result of weak demand due to the 2008-2009 crisis. This development should allow the U.S. to average 2.3 percent annual growth during 2013-2018 before falling to 2.0 percent in 2019-2025. In the same two periods, Japan is expected to grow at 0.9 percent per annum.
  • A more significant slowdown is expected for less mature economies over the next year – and beyond. Overall, growth in developing and emerging economies is projected to drop from 5.5 percent in 2012 to 5.0 percent in 2013, with growth falling in China from 7.8 to 7.5 percent and in India from 5.5 to 4.7 percent. From 2019-2025 emerging and developing countries are projected to grow at 3.3 percent.
  • The long-term global slowdown we project to 2025 will be driven largely by structural transformations in the emerging economies. As China, India, Brazil, and others mature from rapid, investment-intensive ‘catch-up’ growth to a more balanced model, the structural ‘speed limits’ of their economies are likely to decline, bringing down global growth despite the recovery we expect in advanced economies after 2013.

StraightTalk®

Global Outlook for Growth of Gross Domestic Product, 2013-2025 (May 2013)

Europe includes all 27 current members of the European Union, as well as Iceland, Norway, and Switzerland.
**Other advanced includes Canada, Israel, Korea, Australia, Taiwan, Hong Kong, Singapore, and New Zealand.
***Southeast Europe includes Albania, Bosnia & Herzegovina, Croatia, Macedonia, Serbia & Montenegro, and Turkey.
Source: The Conference Board Global Economic Outlook 2013, May 2013 update

Global Outlook for Growth of Gross Domestic Product, 1996-2013 (May 2013)

1996 – 2005

2006 – 2012

2012

2013

Distribution of World Output 2012

GDP Growth

Contribution to World GDP growth****

Projected GDP Growth

Contribution to World GDP growth****

Projected GDP Growth

Contribution to World GDP growth****

Projected GDP Growth

Contribution to World GDP growth****

United States

18.2%

3.3

0.7

1.1

0.2

2.2

0.4

1.6

0.3

Europe*

20.3%

2.4

0.6

0.9

0.2

-0.2

0.0

0.3

0.1

of which:
Euro Area

13.8%

2.2

0.7

-0.5

0.1

Japan

5.6%

1.0

0.1

0.2

0.0

0.6

0.0

0.8

0.0

Other advanced**

7.2%

4.0

0.3

3.0

0.2

2.2

0.2

2.8

0.2

Advanced Economies

51.3%

2.7

1.7

1.2

0.7

1.1

0.6

1.2

0.6

China

16.4%

8.1

0.6

10.4

1.3

7.8

1.2

7.5

1.2

India

6.3%

6.5

0.3

7.8

0.4

5.5

0.3

4.7

0.3

Other developing Asia

5.3%

3.9

0.2

5.0

0.2

5.3

0.3

5.0

0.3

Latin America

7.7%

2.8

0.2

3.7

0.3

3.1

0.2

3.0

0.2

Middle East

3.7%

4.6

0.1

4.3

0.2

5.5

0.2

2.2

0.1

Africa

3.3%

4.6

0.1

4.7

0.1

3.7

0.1

4.2

0.1

Russia, Central Asia and Southeast Europe***

5.9%

4.0

0.2

4.0

0.2

3.6

0.2

2.9

0.2

Emerging and Developing Economies

48.7%

5.0

1.8

6.5

2.8

5.5

2.6

5.0

2.4

World Total

100.0%

3.6

3.5

3.2

3.0

*Europe includes all 27 current members of the European Union, as well as Iceland, Norway, and Switzerland.
**Other advanced includes Canada, Israel, Korea, Australia, Taiwan, Hong Kong, Singapore, and New Zealand.
***Southeast Europe includes Albania, Bosnia & Herzegovina, Croatia, Macedonia, and Serbia & Montenegro, and Turkey..
****The percentage contributions to global growth are computed as log differences and therefore do not exactly add up to the percentage growth rate for the world economy.
Source: The Conference Board Global Economic Outlook, May 2013 update.

Comparison of Base Scenario with Optimistic and Pessimistic Scenarios, 2013 – 2025 (May 2013)

2013 – 2018

2019 – 2025

GDP Growth in Optimistic Scenario

GDP Growth in Base Scenario

GDP Growth in Pessimistic Scenario

GDP Growth in Optimistic Scenario

GDP Growth in Base Scenario

GDP Growth in Pessimistic Scenario

Distribution of World Output 2025

United States

2.5

2.3

2.1

2.4

2.0

1.6

18.3%

Europe*

1.5

1.2

0.8

1.6

1.3

0.9

17.4%

of which:
Euro Area

1.4

1.1

0.8

1.6

1.3

1.0

12.0%

Japan

1.3

0.9

0.5

1.2

0.9

0.7

4.8%

Other advanced**

3.5

2.6

1.7

2.5

1.8

1.2

7.3%

Advanced Economies

2.1

1.8

1.4

2.0

1.6

1.2

47.8%

China

8.0

5.8

3.7

4.9

3.7

2.5

22.7%

India

5.7

4.7

3.6

4.5

3.8

3.2

8.2%

Other developing Asia

6.4

5.0

3.6

5.5

4.4

3.2

4.9%

Latin America

3.9

3.2

2.5

3.4

2.8

2.2

7.1%

Middle East

2.7

2.5

2.3

2.5

2.3

2.0

2.5%

Africa

5.1

4.1

3.2

5.0

4.1

3.2

2.6%

Russia, Central Asia and Southeast Europe***

3.1

2.1

1.2

2.1

1.5

1.0

4.1%

Emerging and Developing Economies

5.7

4.4

3.0

4.2

3.3

2.5

52.2%

World Total

4.0

3.1

2.2

3.3

2.6

1.9

100.0%

*Europe includes all 27 current members of the European Union, as well as Iceland, Norway, and Switzerland.
**Other advanced includes Canada, Israel, Korea, Australia, Taiwan, Hong Kong, Singapore, and New Zealand.
***Southeast Europe includes Albania, Bosnia & Herzegovina, Croatia, Macedonia, Serbia & Montenegro, and Turkey.
Source: The Conference Board Global Economic Outlook 2013, May 2013 update

Indian Prime Minister Manmohan Singh said the country’s economic slowdown was cyclical and temporary and that pessimism was unwarranted.

Many economists say hurdles to growth stem from the government’s slow pace of policy reforms as well as the country’s crumbling infrastructure and layers of red-tape.

India’s economic troubles are reflected in its gaping fiscal deficit, persistently high inflation and pessimism among businesses and consumers. This has driven down investments and demand.

Uncertainty in developed markets hasn’t helped. India’s exports, which account for about a fifth of its gross domestic product, have slowed sharply over the past year. Meanwhile, the country’s import bill has swelled, leading to a record-high current account deficit at 6.7% of GDP in the October-December quarter.

Eurozone  is a signal that worst is yet to come ?

 

http://articles.timesofindia.indiatimes.com/2013-06-01/europe/39673930_1_unemployment-rate-youth-unemployment-unemployment-figures

Unemployment across the 17 European Union countries that use the euro hit another record high in April – and appears to be on course to hit 20 million this year in what would be another gloomy landmark for the currency bloc.

Eurostat, the EU’s statistics office, said on Friday that the unemployment rate rose to 12.2% in April from the previous record of 12.1% the month before. In 2008, before the worst of the financial crisis, it was around 7.5%.

A net 95,000 people joined the ranks of the unemployed, taking the total to 19.38 million. At that pace, unemployment in the currency bloc – which has a population of about 330 million – could breach the 20 million mark by the end of the year.

The unemployment figures mask big disparities among the euro countries. While over one in four people are unemployed in Greece and Spain, Germany’s rate is stable at a low 5.4%.

The differences are particularly stark when looking at the rates of youth unemployment. While Germany’s youth unemployment stands at a relatively benign 7.5%, well over half of people aged 16 to 25 in Greece and Spain are jobless. Italy’s unemployment rate hit its highest level in at least 36 years to over 40%.

“Youth joblessness at these levels risks permanently entrenched unemployment, lowering the rate of sustainable growth in the future,” said Tom Rogers, senior economic adviser at Ernst & Young.

By contrast the US economy has been growing steadily since the end of its recession in June 2009 and the jobs market has started to improve, with the unemployment rate falling to 7.5% in April.

The asset quality is declining in tandem with the economic cycle : http://www.livemint.com/Opinion/JdBQccPTowuvisdqj9guXN/The-deterioration-in-Indian-banks.html

The financial problems of Indian companies are now being reflected in the asset quality of banks that have lent them money.

The disappointing fourth quarter results announced by the State Bank of India in May are perhaps the starkest example of how the financial condition of Indian banks has deteriorated in tandem with the economic cycle. A recent report by India Ratings and Research, an arm of Fitch Ratings, predicts further deterioration—Rs.1.26 trillion of bank loans may potentially be in distress over the next 12 to 24 months, it says.

The Reserve Bank of India (RBI) has done well to begin making it tougher for banks to brush their problems under the carpet. The central bank on Thursday tightened the rules for corporate debt recasts, asking banks to set aside more money for restructured loans as well as making promoters of companies personally liable for loan losses. This follows an earlier decision in November to increase provisioning for restructured assets.

Non-performing loans have been climbing. The problem of restructured assets has also been increasing over recent quarters. The total value of restructured loans in bank books under the corporate debt restructuring facility was an estimated Rs.2.29 trillion in March. There are an additional Rs.1.7 trillion of loans that have been restructured on a bilateral basis between individual banks and their troubled borrowers, according to unofficial estimates.

Such restructured loans as well as the usual bad loans now weigh down bank balance sheets.

The recent moves to raise the cost of loan restructurings—or the withdrawal of regulatory forbearance—is an implicit signal from the central bank that problem loans will not disappear in a jiffy. It usually makes sense to give lenders breathing space to put their loan books in order when companies are hit by a temporary downturn. A few quarters of leniency can help companies get back to their loan repayment schedules quickly. But it is now increasingly clear that the Indian economy is in the midst of a long slowdown, so banks will need to be far tougher with problem loans.

The rise in problem loans should not come as a surprise. It is the inevitable aftermath of a credit boom, as is the case in other economies as well. Loan growth in India was around twice of nominal gross domestic product in the years that immediately preceded the 2008 crisis, a sure sign of effervescent lending. Part of this unusual buoyancy in lending can be explained by the decisions taken within banks but the pressure from New Delhi to step up lending in those exuberant years was also a factor. This is the moment of the inevitable hangover.

What now? A quick improvement seems unlikely. First, it seems that India has still not seen the bottom of the credit cycle. Second, the standard metrics on the ability of companies to service their debt (such as interest cover and free cash flow) are also flashing amber. Third, a sharp reduction in interest rates seems unlikely despite the unexpectedly sharp drop in inflation in recent months. Our assessment is that asset quality in Indian banks will continue to deteriorate for at least a few more quarters (though rising bond prices as a result of a fall in long-term yields could provide some buffer to banks that collectively own more than a quarter of their assets in bonds).

The asset quality of banks is closely related to the state of the underlying economy, which is now in the midst of a structural slowdown. The recent regulatory tightening should be examined against this backdrop, as a recognition of the true state of the Indian economy.

Investors too should welcome the stricter measures, because the regulatory forbearance we saw after 2009 was an attempt to postpone the day of reckoning, when a bank has to take a hit from its problem loans.

FDI inflows declining and rupee depreciating

http://www.thehindu.com/business/Economy/fdi-dips-by-38-to-224-bn-in-201213/article4775276.ece

Government’s efforts to promote India as an investment destination does not seem to be yielding fruits as FDI inflows registered 38 per cent decline to $22.42 billion in 2012-13 compared to the previous year.

FDI inflows were worth $35.12 billion in 2011-12.

The government had taken several policy decisions in the past few months to attract foreign investments. Important among these include allowing FDI in multi-brand retail and civil aviation sectors and seeking legislative approval for increasing FDI cap in insurance and pension sectors.

In March this year, the country had attracted $1.52 billion FDI, taking the total to $22.42 billion in the entire financial year, an official in the Department of Industrial Policy and Promotion (DIPP) told PTI.

Sectors which received large FDI inflows during 2012—13 include services ($4.83 billion), hotel and tourism ($3.25 billion), metallurgical ($1.46 billion), construction ($1.33 billion), automobiles ($1.53 billion) and Pharmaceuticals ($1.12 billion), the official added.

India received maximum FDI from Mauritius ($9.49 billion), followed by UK ($7.87 billion), Singapore ($5.25 billion), Japan ($2.97 billion) and United States ($1.11 billion).

According to industry experts, there is a need to improve business environment in the country.

In November 2012, India attracted FDI worth $1.05 billion, which was two—year low.

India would require around $1 trillion in the next five years to overhaul its infrastructure sector such as ports, airports and highways to boost growth.

Decline in foreign investments could put pressure on the country’s balance of payments and may also impact the value of the rupee.

Rupee declined by 12 paise to end at 11—month low of 56.50 against the US dollar on Friday amid worries over current account deficit and GDP growth.

With FII outflows of $90 million in stocks, RBI’s poor inflation outlook and GDP growth rate falling to decade’s low of 5 per cent pushed the rupee downwards to 56.76 — its lowest since June 28, 2012.

Economic growth rate slipped to a decade low of 5 per cent in 2012—13 due to poor performance of farm, manufacturing and mining sectors.

GDP growth in Jan- March is a mere statistical growth due to base affect ?

http://www.livemint.com/Opinion/DuHmUO6Inoyspt254OeGWJ/GDP-growth-improves-a-tiny-bit-aided-by-smoke-and-mirrors.html

Has the economy turned the corner? That’s the big question the gross domestic product (GDP) numbers were supposed to answer. Has it indeed bounced off a bottom? At first glance, the answer to that question seems to entirely depend on your measuring rod. For instance, if we take the quarterly estimates of GDP at 2004-05 market prices from the expenditure side, we find real GDP growth was 3.4% in the June quarter, 2.5% in the September quarter, 4.1% in the December quarter, and 3% in the March quarter. By that yardstick, the economy hit a bottom in the September quarter of 2012-13, bounced back in the next, and then fell back again in the March quarter. The rather dubious consolation is that this yardstick is well known to be dodgy and the credibility of the expenditure-side GDP figures is rather low.

Going back to the more credible GDP data at factor cost, we find growth was 4.8% in the March quarter, a mite higher than the nadir of 4.7% reached in the preceding quarter. That would indicate that the economy has indeed bounced off a bottom, a very weak bounce, more of a twitch really.

The problem, as usual, lies in the base effect. It’s true that real GDP growth at factor cost was 4.7% in the third quarter and 4.8% in the fourth quarter compared with a year ago. That 4.7% growth was on top of 6% growth in the third quarter of 2011-12, while the 4.8% growth was on top of a much-lower 5.1% growth in the fourth quarter of 2011-12. Even the feeble bounce was entirely statistical.

The same holds true for several of the sectors. Growth in manufacturing, for example, has moved up slowly and steadily from minus 1% in the first quarter of 2012-13 to 2.6% in the fourth quarter. That looks like a decent recovery. The problem is that in the first quarter of 2011-12, manufacturing growth was 7.4% and it was a mere 0.1% in the fourth quarter of that year. In short, the entire credit for the growth in manufacturing goes to the base effect.

Apart from agriculture, with its seasonal vagaries, are there any sectors that have bucked the base effect? The financing, insurance, real estate and business services segment seems to have done just that. It grew by 9.1% in Q4, 2012-13, on top of 11.3% growth in the year ago quarter. Compare that to its much-lower 7.8% growth in Q3, 2012-13, on top of 11.4% growth in the year ago quarter.

On the other hand, there are several sectors that have done badly in spite of a favourable base effect. Consider electricity, gas and water supply, whose growth rate has gone down from 4.5% in the third quarter of 2012-13 to 2.8% in the fourth, although growth in this sector in Q4 of the previous year was much lower than in Q3 that year. This clearly shows the impact of supply-side problems in the power sector. Similarly, growth in trade, hotels, transport and communication slackened a bit in the fourth quarter compared with the third, despite a favourable base effect. Community, social and personal services, a proxy for government expenditure, unsurprisingly saw tepid growth as the fiscal deficit came down.

How much did the different sectors of the economy contribute to GDP growth in 2012-13? As much as 35% of the growth was generated by the trade, hotels, transport and communication sector, closely followed by financing, insurance, real estate and business services, which accounted for 31.3%. The community, social and personal services segment contributed 16.8% of the growth. It means these three service sectors contributed a huge 83.1% to growth last fiscal year.

Contrast the miserable performance of manufacturing, which accounted for a mere 3.3% of growth. The construction sector contributed more than double that. As a matter of fact, agriculture, forestry and fishing generated 5.4% of last year’s growth, more than the share of manufacturing. The contribution of the mining sector was negative, because of the court-directed closure of mines. The chart shows the contribution from the different sectors. Clearly, mining is the weakest link, closely followed by manufacturing.

The Central Statistical Organisation also seems to have been bang on target with its estimate of 5% real GDP growth at factor cost for 2012-13. A closer examination shows, however, that it had overestimated growth in manufacturing, mining, electricity, gas and water supply and, to a minor extent, in community, social and personal services, and underestimated growth in trade, hotels, transport and communication. That the overall growth rate came out exactly as it predicted can be attributed to an extraordinary stroke of luck.

 

India’s growth slows down – India is running out of fuel ?

http://timesofindia.indiatimes.com/business/india-business/Its-official-Indian-economy-slowed-to-a-10-year-low-of-5-in-2012-13/articleshow/20374920.cms

The Indian economy grew at its slowest pace in a decade in 2012-13, posing another fresh challenge for the UPA coalition to revive growth and boost sentiment ahead of the general elections next year.

Data released by the Central Statistical Organization (CSO) on Friday showed that the economy grew 5% in 2012-13, compared to 6.2% expansion in the previous year. It was in line with the advanced estimates released earlier.

The economy grew 4.8% in the January-March period, the fourth quarter of the 2012-13 fiscal year, marginally above the upwardly revised 4.7% expansion in the previous quarter, providing some hope of a tentative turnaround. But the overall economic scenario still remains challenging and the GDP data should come as a wake-up call for the government.

The CSO numbers are also an embarrassment for the finance ministry which had questioned the statistics office’s methodology and expressed doubts about the advanced estimates.

The finance ministry had slammed the CSO for forecasting 5% growth for 2012-13. Finance minister P Chidambaram had said the estimate of 5% was based on “dated data”. He had said that growth would be closer to 5.5% and had exuded confidence that green shoots of recovery were visible in the economy.

The high current account deficit, which widened to 6.7% in the December quarter, and stubborn inflation has acted as obstacles to easing monetary policy aggressively. While the Reserve Bank of India has cut interest rates it has cautioned about the persisting inflationary pressures and risks still facing the economy.

What has been most disappointing is that industrial output growth in 2012-13 has been a mere 1%, posing a threat to job creation and overall growth.

Friday’s data showed the farm sector rose 1.9% in 2012-13 compared to 3.6% in the year-ago period while the crucial manufacturing sector grew 1% compared with 2.7% expansion in 2011-12.

The services sector, which accounts for nearly 60% of the economy, rose 7.1% in 2012-13 compared to 8.2% growth in the year-ago period.

 

CDR gives an indication that the corporate sector is crashing !

http://www.livemint.com/Industry/h7u6wQngeSZ6jL8MfCBpGL/Restructured-loans-cross-227-trillion-pace-slows.html

The latest data from the CDR cell suggests that Indian banks added Rs. 15,016 crore of restructured loans in the March quarter, about Rs. 9,000 crore less than what they had done in the pre ceding quarter. On a cumulative basis, total restructured loans crossed Rs. 2.27 trillion, or 4.4% of the total loans given by Indian banks.

Indian banks have been hit by a surge of bad loans in the face of declining economic growth, estimated at a decade’s low of 5% in the year ended 31 March, project delays and high interest rates that have made it difficult for borrowers to repay debt. Lenders have been easing repayment terms to avoid classifying them as bad assets.

The CDR numbers do not reflect the actual pile-up of restructured loans in the banking system because lenders also recast loans outside the CDR platform, on a bilateral basis.

The aggregate figure for bilateral loan recasts is not available, but bankers said such recasts may nearly equal the CDR figure. That would take the total restructured assets of the Indian banking industry to around Rs.4 trillion.

In the whole of fiscal 2012-13, Indian banks restructured a total of Rs.77,101 crore of loans through the CDR route, nearly double the amount in the previous fiscal (Rs.40,000 crore). Analysts expect about 25-30% of such loans to turn bad.

Iron and steel contributed most to the restructured loan pile—23%—followed by infrastructure (9.65%) and power (8.13%). The textile, telecom and fertilizer sectors, and non-banking finance companies, too, are high on the list.

Despite a decline in the CDR numbers in the March quarter, bankers and financial sector analysts are sceptical about a sustainable revival at Indian companies. The pain associated with mounting bad loans is unlikely to ease at least in the next six months, they said.

Gross non-performing assets (NPAs) of 40 listed Indian banks rose to Rs.1.79 trillion in December fromRs.1.25 trillion a year ago, an increase of 43.1%. In the past, the Reserve Bank of India (RBI) had cautioned banks about the need for enhanced risk assessment tools to monitor loan quality.

Factory output shrinks 1st time in over 4 years .

http://in.reuters.com/article/2013/06/03/india-manufacturing-pmi-idINDEE95203N20130603

The sombre PMI findings came hard on the heels of data released on Friday that confirmed Asia’s third largest economy grew at its slowest pace in a decade in the fiscal year that ended in March.

The overall HSBC Manufacturing Purchasing Managers’ Index (PMI), which gauges business activity in Indian factories but not its utilities, sank to 50.1 in May from 51.0 in April, and was the third straight monthly fall.

Though the May reading was the lowest since March 2009, the overall index has held above the watershed 50 level that divides growth from contraction for over four years.

The reading for the factory production sub-index, however, showed output contracted in May from a month earlier as new orders growth slowed to a trickle. The output sub-index fell to 48.6 in May from 50.2 in April.

“Economic activity in the manufacturing sector slowed further in May as output contracted in response to softer domestic orders,” said Leif Eskesen, an economist with survey sponsor HSBC. Eskesen said power outages added to the drop in production

Defaults in Agricultural credit in another bubble ?

http://www.livemint.com/Industry/ph30HumD1FPAGaBj0XCOyH/Kisan-Credit-Cards-Bad-loan-bubble-waiting-to-burst.html

A surge in exposure to farm debt through Kisan Credit Cards (KCCs) could emerge as a risk for India’s state-run banks, according to experts.

Subsidized loans are given to farmers through KCCs by state-owned banks. Until March 2012, the outstanding amount on such loans was Rs.1.6 trillion through 20.3 million cards, as per the latest Reserve Bank of India (RBI) data. This may have risen to around Rs.2 trillion, bankers said.

Bad loans may be piling up at banks, but they don’t reflect on the books as the credit limit on such cards keeps increasing. Even if a borrower fails to pay up and the banks add the unrealized interest to the exposure because of the rising credit limits—typically 10% every year—the so-called capitalization of interest does not affect the status of the loan account.

State Bank of India (SBI) has the largest exposure to KCC loans—about Rs.44,000 crore— and 5% of this has turned bad, the bank said; Central Bank of India’s exposure isRs.8,428.05 crore and that of Bank of Maharashtra is Rs.2,045 crore.

According to RBI data, banks had Rs.33,200 crore overdue in the direct agrifinance portfolio till 2011 June. The latest figures are not available.

The credit culture in rural India deteriorated sharply after the government announced a Rs.70,000 crore debt waiver for farmers in the February 2008 budget.

The farm loan waiver was one of the United Progressive Alliance government’s key programmes in its first tenure and at least partly responsible for its return to power in 2009.

“Outstanding KCC loans have grown at around 33% in past two years while the number of credit cards has grown at around 13%,”

The share of agriculture, which once generated maximum jobs, has been shrinking as a percentage of national income in Asia’s third largest economy—from 35.75% in 1981 to 16.75% in 2012.

Agriculture is one of the largest sources of bad loans for most banks. It is contributing 9.72% to the gross NPAs of SBI and 7% of Central Bank of India. The nation’s largest lender SBI has the largest gross NPAs —Rs.53,457.79 crore, or 5.3% of loans, followed by Punjab National Bank (Rs.13,997.82 crore, or 4.61% of loans), Central Bank of India (Rs.8,938.47 crore, or 5.64% of loans) and UCO Bank (Rs.6,711.29 crore, or 5.53% of loans).

A bad monsoon could mean a dramatic turn for the worse as the June-September rainy season constitutes India’s main source of irrigation.

Brief summary :

  1. The financial problems of Indian companies are now being reflected in the asset quality of banks that have lent them money.

And the NPA’s are growing every hour.

  1. Government’s efforts to promote India as an investment destination does not seem to be yielding fruits as FDI inflows registered 38 per cent decline to $22.42 billion in 2012-13 compared to the previous year.
  1. The Indian economy grew at its slowest pace in a decade in 2012-13
  1. Industrial output growth in 2012-13 has been a mere 1%, posing a threat to job creation and overall growth.
  2. Factory output shrinks for the 1st time in over four years
  3. Farm sector rose 1.9% in 2012-13 compared to 3.6% in the year-ago period while the crucial manufacturing sector grew 1% compared with 2.7% expansion in 2011-12
  4. The services sector, which accounts for nearly 60% of the economy, rose 7.1% in 2012-13 compared to 8.2% growth in the year-ago period.
  5. The share of agriculture, which once generated maximum jobs, has been shrinking as a percentage of national income in Asia’s third largest economy—from 35.75% in 1981 to 16.75% in 2012.
  6. Until March 2012, the outstanding amount on Kisan Credit card loans was Rs.1.6 trillion through 20.3 million cards, as per the latest Reserve Bank of India (RBI) data. This may have risen to around Rs.2 trillion
  7. “Outstanding KCC loans have grown at around 33% in past two years while the number of credit cards has grown at around 13%,”

10. Gross non-performing assets (NPAs) of 40 listed Indian banks rose to Rs.1.79 trillion in December fromRs.1.25 trillion a year ago, an increase of 43.1%.

11. The total restructured assets of the Indian banking industry could be around Rs.4 trillion.

12. All the emerging or the sunrise industries are not earning enough to pay loans and this clearly shows that India is a oversold story . Iron and steel contributed most to the restructured loan pile—23%—followed by infrastructure (9.65%) and power (8.13%). The textile, telecom and fertilizer sectors, and non-banking finance companies, too, are high on the list.

13. Eurozone is passing through a crises that could worsen, and impact the Indian exporters

14. Rupee is depreciating, and is the worst performing currency in Asia

Overall, I stand by my assessment of the Indian economy in March 2012 (https://commonmansblog.com/2012/03/22/have-we-oversold-the-india-story/ ) and in October 2012 (https://commonmansblog.com/2012/10/11/india-from-emerging-to-a-submerging-economy/ )that India is an oversold story and should prepare for the worst times ahead . Also, I said on my blog in March about India facing a security threat , and we know what China did (https://commonmansblog.com/2013/03/03/economy-downgrade-and-downfall-both-are-a-foregone-conclusion/) .

I see no reason to believe that India will be back to normal before 2015-16, and that too, provided politicians become realistic . In the current environment , none of the political parties or the politicians have a plan to salvage the situation, and my prediction is , that  India’s growth rate might fall below 4 % .  The Indian Titanic is in mid of a turbulent sea, heading towards a more severe storm . The Titanic is sinking . Can we do something ?

Rajendra Pratap Gupta

http://www.commonmansblog.com

Potato Politics and Commercial Airport in Rae Barielly !


Dear Rahul,

Last week you made a statement that , ‘ 50 grams of potato chip are sold for Rs. 10 , and that this is made from just half potato’ ! Correct ! But again , Rahul don’t forget that the foreign companies no lesser than Wal-Mart ( likes of Pepsico ) are selling these expensive potato chips made from half a potato . So, does it not make more sense to check the growth of MNC retail chains / companies in India, who are buying cheap potato but ‘profiteering’ by selling chips at Rs. 10 per packet and the poor farmer is losing his produce at a throw away price  ?

Also, I wish to draw your attention towards the fact that currently the farmers are paid Rs. 1 per KG. I cannot understand why will ‘Profit & balance sheet obsessed’ Retail chains pay more to these poor farmers !

Simply stating that the middlemen would be removed and so farmers will get more, is a fallacious statement and conveys a lack of your ignorance about the realities. I think your party and Maya ji are fighting in the ‘aerial warfare’ with no touch of realities on the ground

I can clearly see the trick in getting the farmer leader Ajit Singh into Congress. Clearly , he will help you pitch farmers in favor of FDI and also convert a few of them as voters . But these tactics might not work in the long run , hopefully there are millions like myself who know the reality of these old tricks of congress for vote bank politics  !

I read another news that Rae Bareilly will get a commercial airport

Let me enlighten you about the Awadh region where your dad , mom & yourself have fought & won elections for decades

The Awadh region once ruled by nawabs and taluqdars and known as granary of India because of its fertile Gangetic plain. The area has given prime ministers to the country – Indira Gandhi, Rajiv Gandhi, and Atal Bihari Vajpayee. But most districts are still backward.

Population | 3.654 Cr

Per Capita Income | Rs 13,150.81

Faizabad division | Faizabad, Ambedkar Nagar, Sultanpur, Chhatrapati Shahuji Maharaj Nagar, Barabanki

Devipatan division | Gonda, Balrampur, Shravasti, Bahraich

Kanpur division | Kanpur, Ramabai Nagar, Auraiya, Farrukkhabad, Kannauj, Etawah

Lucknow division | Lakhimpur, Lucknow, Sitapur, Hardoi, Unnao, Rae Bareli

Now here is an interesting fact : Purulia is better off than Rae Bareli and Amethi and this was quoted in this article of Business Standard & Mid-Day. http://www.mid-day.com/poll2009/2009/apr/270409-Purulia-is-better-than-Amethi-Left-tells-Rahul.htm 

Let me walk you through a planning commission report on the per capita domestic product , and the NDP per capita in your family’s constituency.

Net domestic product (total and per capita) 2006-7 as per planning commission, Government of India

 

  At Current Prices At Constant Prices 1999-2000
  Domestic Product (Total) Rs. in CR. Per Capita Domestic Product (Rs.) Domestic Product (Total) (Rs. in Cr.) Per Capita

Domestic Product (Rs.)

Rae Barielly 3288 10361 2489 7844
Sultanpur 3955 11168 3077 8687
         

Source:http://planning.up.nic.in/Annual%20Plan%202010-11%20for%20website/Volume%20-%20I%20(%20Part-II)/Chapter-6.prn.pdf

 So clearly, getting an airport in Rae Barielly is a stupidity of the highest order, and that too, when it is clear that the region is back ward and people can barely survive a year without good rains leave alone travelling by air ! Please read the per capita income and check out if the poor people of that district can even afford the air port taxes leave along the airfare !

 I have visited Amethi and met up with dozens of self-help groups that you have formed in Amethi, and let me tell you that, you are just ‘Using’ the emotions of these poor people for becoming a member of Lok Sabha from Amethi

 While I was travelling to Amethi, none else than your own people (close associates) have informed me that the worst road in India is between Rae Bareilly and Sultanpur. Do I write more!

 Learn from Mr. Vajpayee , who started the Golden Quadrilateral project for the Aam Aaadmi and your government is more interested in airports, so that you can fly directly to Amethi rather than taking the 2 hour road drive to Amethi via Lucknow . You are wasting the hard earned money of common men like myself , who earn by hard work and pay 1/3rd of our income as taxes to the government , and people like you go and throw it for things like building an airport at Rae Barielly !

By the way i could not understand that in the same week you talked about potato being sold at Rs.1 per KG and the other side an Airport in Rae Barielly ?

 Gandhi Dynasty has taken India back ward by at least 30 years , and we need to stop it soon.

 I also don’t understand what is your intent for the so-called ‘Food Security Bill’ and ‘Job Guarantee Bill’. You will give fixed income to people so that they do not have to work and then you guarantee them food ? So it means that people will not have to work and earn the food , and will get it free ? Where will the Rs. 5 lac crore come from for these schemes ?  Will these things take India forward or your party men who will get the ration shops to distribute ( read divert ) grains and sell them to the open market, and finally , the poor Aam Aadmi will be left stranded on the road !

 Wake up Rahul ! Time will never forgive your people, and the elections will decide your fate not this ‘aerial warfare’  .

Rajendra Pratap Gupta 

Healthcare I Retail I Rural Economy I Public Policy

www.commonmansblog.com

FDI in retail – This is a harsh reality – Is FDI really a boon for India at this time ?


Government’s arguments for FDI in retail are a proof of the fact, that this government does not understand India, and looks at Indians from USA’s businessmen’s perspective. Congress government has become the biggest lobbyist for pursuing the business interest of nuclear & retail corporations from USA & Europe at the cost of India’s middle class

Today’s Economic Times (26th November 2011) headline ‘ Govt Sells Multi-Brand FDI with best bargains’ gives a list of reasons why the government is supporting, (rather pushing FDI ) in retail. Let me put the Common Man’s view and take on each of these arguments

1.     It will create 10 million jobs in the next 3 years

A) According to the CII report in 2007, ‘India will need 10 to 12 million skilled workers every year for the next five years to meet the growing demand from the support services and there is a need for strong intervention to ensure the availability of the workforce’. So is the government trying to say that it is only the retail chains that will create 10 million jobs in the next three years?

B) Let us examine how many jobs Wal-Mart created in America & how many jobs did Wal-Mart create in India for the past 3 years of operations both as a wholesaler and as a retailer ? How many jobs our Indian retailers like Future group, Aditya Birla retail and Reliance retail created in the past 3 years?  We will clearly see that they did not even create a million jobs!

C) Also, government does not talk how many Kirana stores will shut down in the next 5 years and how many homes will be denied of a source of income ?

D) Wal-Mart or for that matter any retailer works on the least number of workers per square feet (lean management structures ) ,and so it will kill the 50 Kirana stores thereby get at least 250 people out of jobs and then create 50 jobs per super market.  Is this factored in the statement? I am willing to prove this in the current retail scenario leave alone the scenario when the foreign retailers come in?

 2.     Several billion dollars of investment in retail

A) If retail is a great business, the government banks should give loans from domestic financial institutions and let the homegrown retailers grow and build scale and size and let the profits remain in India. Why should we give 51 % of the ownership to foreign players, as these people will sell to Indians and take the profits out of our country.  USA / Europe will solve their income and earnings problems and India will get into problems of high inflation and more volatile stock market. Also, Indian retailer being less than 50 % of their share in the retail will become servants to these MNC chains under the current 51 % FDI norms.

B) Why did the government not start with 26 % FDI in multi brand retail for the first five years? Why suddenly start with 51 %. Please justify?

C) Often it has been quoted that the foreign retailers will bring technical know how to Indian retail market and boost the economies of scale and productivity? Which technical know how is the government talking, it needs to explain? I have been a COO / Board member of a major fortune 20 company’s retail operations in India, and I can tell you that these foreign retailers only bring money and no other expertise! They work on high profits, highly automated environment and lean man power structures.  So government’s reason of the technical know how is fallacious and is showing that we Indians do not understand retail. Let us look inward and see our home-grown retailers like Future group and Aditya Birla retail .They are certainly growing . Government must bring out a detailed white paper on the so-called ‘Technical Know how’ these foreign retailers bring to Indian retail market?

D) With these billions of dollars coming in India, India’s real estate will become expensive thereby, contributing to keep the inflations levels high for the medium class not just for real estate but for all the sectors

E) Also, these billions of dollars are not charities to India or Indians . These are investments by retailers which follow a ROI ( return on investment concept ) for every dollar spent. So for sure , they people will invest in retail one dollar and take out 10 dollars from India over the next couple of years . Retail is mostly done on inventory management which is on credit from vendors . These retailers follow a credit cycle which ranges from 15 days to over month . So with a double-digit profit margin , these retailers will only be investing one time into infrastructure and then make money without investing at all ,as all the inventory is on a credit cycle . ‘Sell and pay’ is the mantra for these FMCG retailers ! Even the space which is rented by these retailers is leased to product companies for hefty display charges. These retailers charge a heavy fee for listing products in its store before selling .Our policy makers , wake up and understand the real dangerous game of FDI in retail and don’t get carried away by the billions of dollars of investment . It is not true . One time investment by these retailers will be a life long profit for their parent company’s home country

3) Farmers will get more than 12-15 % of the consumer price they get for fruits and vegetables

A)    In reality, farmers will never get a higher price but will be exploited by these MNC Chains  .In fact, these MNC retailers will push in for stringent quality checks and other prohibitively expensive conditions for these farmers thereby, forcing the poor Indian farmer out of his livelihood. Most of the retailers will take to contract farming, and thus the farmers will be reduced to being laborers in the hands of these MNC chains.

B)    The History of these MNC chains has shown the these chains are out to squeeze blood out of their vendors and farmers will certainly be vendors for these MNC chains and nothing else . Wal-Mart and other retailers are facing dozens of cases of exploitation and gender bias in developed country where the legal system is strong . Imagine what will happen in our country ?

4) Consumers will get producers at Cheaper Prices, as competition will bring down the prices

A)    Even without competition the prices will come down by a few paisas or may be a few rupees, but, all these chains will increase the MRP  (Maximum retail prices) of the products, and so the consumer will end up paying more than what s/he pays today. Take an example of the MNC pharma companies. Since there is a ceiling of price increase by 10 %, so every year the pharma companies increase the prices by 9-9.5 % and thereby, circumventing the price increase regulations.

B)    It is clear that the consumer is not a winner, no one pay’s from its pocket OR profits to the consumer. If there is a price increase on the input costs, the same is passed on to the as an increased MRP or the quantity is reduced for the same price. So the consumer’s pocket is always ripped apart by these retailers

 

5) 30 % mandatory sourcing from small-scale sector will help small industry

A)    This has not been a convincing argument, so we are trying to tell that a small company out of Varanasi will compete with HUL and win? Come on Dr.Manmohan Singh, are you trying to fool Indians? I understand that you studied at Oxford, doesn’t mean that rest of the Indians are going to get carried away with these statements

B)    Also, these MNC chains will put conditions that are either too stringent to be complied to or prohibitively expensive to be implemented by these SME’s, and so finally, these chains will find a reason to evade buying from these SME’s. Also, that the SME’s are not just limited to India, but across the world, so probably, Chinese SME’s would benefit more than Indian SME’s

C)    These retailers charge a heavy fee for listing products in its store before selling. How will SME’s afford that ? The fee currently for Indian retailers varies from few thousand to over a lac for products for companies . SME’s will never be able to benefit from these chains even if they are able sell to them, as they will pay for listing and then cry for the payment – which will depend on the vendor payment cycle varying for weeks to months and small vendors (SME’s ) cannot survive this big box retail game

6) 70 % of retail is in food items and these are mostly sourced locally

A) If 70 % of the retail is in food items and this is sourced locally, why allow 51 % of the profits to go out of India? So FDI should not have crossed more than 30 %!

B) Local Indian retailers (existing Kirana stores ) must be trained to deal in these food items and deliver better value for the country and its economy.

C) This argument of the government goes against its own policy. So whereas, 70 % of the products would be food items, 51 % profits from these categories would go out of our country, thereby, clearing pushing the inflation higher perpetually for the next couple of decades. As there will be less money in our country chasing more goods ( as money would have found its way to parent MNC)  – Simple economics Mr. Kaushik Basu!

 

7) Ikea already sourcing 30 % of inputs from India

A) So if Ikea is already sourcing 30 % inputs from India, let other chains also do the same before starting their shop in India.

B) If these MNC chains buy from India and sell in India and take 51% of the profits abroad, what is India’s gain? The government must come out clean on this?

8) Approval only after investors meet all conditions, including 50 % investment in back end

A) This statement of investment in backend is a foolish statement. Already 100 % FDI is allowed in wholesale, why justify it for retail and link it up? Let these retailers first invest in back-end for the first five years and next five years invest in front end

B) Government has FCI (Food corporation of India) godowns and what is the government doing for enhancing the efficiency of this biggest warehousing corporation – Can this FCI not  become the Cash and Carry for small retailers ? A drastic improvement in supply chain of FCI godowns can bring down the wastage of food grains by hundreds of tons if not thousands of tons. Please pursue the project of Mr.Atal Behari Vajpayee of Golden Quadrilateral and link up all the FCI godowns, and start a national Agriculture produce transport corporation to start weekly transport during the harvesting season from the farms to FCI and nearest towns. The farmers co-operative and IFFCO should manage this. With this, farmers will not only get good prices but the wastage will be reduced substantially. Why are you looking at FDI to solve this simple problem of inflation . This can not only solve the inflation problem but also improve productivity at all levels , create more jobs ( may be , millions of low & middle-income but high productivity jobs ) and reduce inflation .

C) Learn from ‘operation flood’ by AMUL and how it solved the shortage of milk problem of our country and created a world-class brand. See what M.S.Swaminathan did with ‘Green Revolution’ to increase the production of grains in our country. Please do not justify that foreign retailers will help you bring down inflation. Remember that ‘Inflation is reversible but FDI is not’ and do not sell our country to foreigners for a short-term gain of a few billion dollars to our economy. This is anyway not the dollars to our economy, but the investment of dollars to take back dollars. I am sure that all these MNC chains a ROI (return of investment) method of calculating the investment returns. So I wish to ask our government that what does the ‘retail FDI dollar’ bring to India, which Indian government cannot do with its own money?

9) Government will have the first right over procurement of farm produce

A) This statement has no value. Government has shown no concern for farmers except considering them as voters and leaving them at the mercy of rain gods.

Questions that the government must answer

  1. What has the government spent to train local Kirana stores in the past five years?  When yesterday only the government asked for Rs.56000 crore of the tax payers money despite a huge budget deficit, why did it not ask for even a Rs. 1000 crore for retailers training and up gradation?
  2. Why did the government not start with FDI in retail at 26 %? Why suddenly at 51 %? Has the government become a lobbyist for MNC chains?
  3. Has the government done its own independent studies for the impact of retail chains on Kirana stores?
  4. The biggest plank of allowing the FDI is that inflation will come down. So despite allowing FDI, if the inflation does not come down, will the government revoke FDI in retail? Does that rider appear in the CP (Condition Precedents) for allowing FDI in retail?
  5. Government needs to prove that FDI in retail can create million jobs every year. How and why, and which retailer will do that. All this must be put in the business case for allowing FDI? Why is government becoming the spokesperson for these MNC retail chains? What is the deal?
  6. Where and how much wills the retailers invest in back-end? This has not been specified?
  7. Why has the government not capped the retail margins of foreign retailers in India?
  8. See point 5 B, why have women self-help groups / handicrafts been excluded from being the beneficiaries of the retail entry
  9. Why are retailers not mandated to invest in retail training ?
  10. More questions to follow

Rajendra Pratap Gupta

Healthcare I Retail I Public Policy

Email:  office@rajendragupta.in , office.rajendra@gmail.com

Corruption mera Karma aur Coalition mera Dharma


Dear Manmohan ji,

The common man is really frustrated with your ‘blame game’ approach in the recent press conference . When you became the PM, we had hoped that an economics Professor who had been educated in the best of institutions in India and abroad , could impress upon the people in his party and change the governance of the nation without compromise. But , by staying silent on all the unethical activities in the congress , not only you denigrated the national institutions , you lowered the stature of the Prime Minster’s post & eroded the trust of the common man .

In the press conference , you said that, ‘let’s not just focus on scams as that lowers the image of the nation’. I wish to point Dr.Singh that, not just the image but also the financial health of the nation has been affected due to your being a patron of corruption !!

You have clearly conveyed that ‘ Corruption is your Karma & Coalition is your Dharma’. While it is known that you had some good qualities like knowledge , honesty etc , but you did not exercise those qualities , so in a sense , you became a greedy professor wanting to just stick to the Chair of the PM .

I am wondering how come Pranab Mukherjee was not questioned in this scam when he is the finance minister ? Is he just responsible for collecting taxes and not about the financial loss to the nation ? He must also follow Raja in Tihar . No one is above law ! Also, If you have the guts , please question Mukesh Ambani . He is the one who routed international calls as local calls and committed a criminal offence. What has your government done ? The Telecom co’s CEO going to CBI office and having coffee & lunch does not impress the common man. We know that these visits might be a ‘eyewash’ for the common man at the behest of congress party, and the common man is made to believe that your government is acting on corruption . Do not put off the JPC demand quoting these arrests .Suresh Kalmadi is still enjoying the dollars made in CWG !! Why he is he not in Tihar ?

Dr.Singh , every one in India is talking about the black money in Swiss banks , Dr.Singh , India has more black money than all the Swiss banks combined ! Why Pranab Dada does not start taxing expenditure rather than taxing income !! Every government officer is directly or indirectly involved in bribery , every business is into tax evasion , every builder takes a portion of the cost as black money , every minister fights election on black money . Still you think that only Swiss banks have India’s black money ? Swiss banks , I believe would only have 10-15 % of the black money , rest is still in India , and may be, some money might be in middle eastern countries .

Please change your tax system. If you tax one’s income , he might not disclose it , but at the end, the money is used to purchase something , so go and tax expenditure , the government will collect more taxes , and we would be happy paying taxes on expenditure !!

Now back to my question of your moral flexibility to run the government .

Why have you tied up with DMK in a poll bound Tamilnadu ??

Why has the CBI let off Mulayam in the disproportionate assets case ?

Is this a part of Sonia’s five pronged approach to fight corruption ???

Rahul : Where is your clean up of the party going ? Are you cleaning up the honest people by such tie ups ? What about your call to go alone in polls ? While I was at 10 Janpath with you a few months ago , a first generation leader whom you inducted in your party had met up with myself , and he told me that you are just getting educated people in the party . So all new congress leaders have started enrolling in MBA !!. Finally , this call for educated leaders is leading to elite with money bags joining youth congress. You are totally disconnected from the reality on ground !! By the way , Gandhi’s are always disconnected with reality . Nothing new !!

Dr.Singh , by asking Supreme court to directly monitor the probe, you have shown that you have no interest to act on your own or you do not trust that you will do a good job in the case ! We all know why retired supreme court judges get plum posting !! So if nothing comes out of these so called ‘Blame Free investigations’ ( Which we know will happen ) , you will shed off your load saying that you had asked the top most court to direct the probe and that you are like ‘Ceaser’s Wife’ etc etc………………….. and you cannot be blamed for the culprits being acquitted !!

When you constitute the JPC , please also mandate it to come out with an action plan that can

a) Investigate the wealth creation formula of the ex Chief Justice of India K.G. Balakrishnan .

b) Bring back the black money and put the people behind the black money in Jail

c) Recover the loot of public money by people like Lalu , Maya & other leaders like Sharad Pawar etc.

d) Take action for CWG loot

e) Investigate on all massive loot cases happening in the nation

f) Frame up laws and set up a system say a CIA ( Central Corruption Investigating agency ), which can take suo moto action against any one ( Even the President of India ) , should the need arise without going through any approval , and this institution must report to the supreme body – Legislature every six months . This body should be adequately equipped with resources ( legal, financial and human resources ) to decisively act against corruption , and all top level appointments must be made by a body consisting of the P.M. , CJI , CVC & Opposition leader .

I also want you to ask CBI to investigate if Apollo Hospitals Group paid money to A.Raja. I was told by none other than the brother-in-law of A.Raja that Apollo had paid Rs.700.00 crore to Raja

I am also quite surprised that you have quoted that you will not quit the post of PM. It is the height of being shameless

Dr.Singh , history will paint you as Mohammaed-Bin-Tuglaq- A knowledgeable and wise king who caused lot of misery and pain to his people

If you do not shape up, wait for 2014, and the common man will throw the congress government and return results like Bihar

Rajendra Pratap Gupta

A Common Man

http://www.rajendragupta.wordpress.com

What’s Happening ??


Dear National Leaders,

For the last couple of months , we are seeing a ‘high octane’ battle being fought between the parties for two issues ‘ Corruption in congress and unchecked inflation’. As a common man , I am worried that this great nation is going to dogs because of the lack of governance in the ruling party , and lack of outcome based action in the opposition ( which needs to unite for a national cause ) .

The current government is a serious threat to the national security One side , Rahul Gandhi says that Congress will fight corruption , and Sonia says that she has a five pronged strategy for fighting corruption , one the other side , we see that congress goes and co-habits with DMK for the Tamilnadu elections, and the government is shy of disclosing the names of 17 account holders in Swiss banks , so it clearly tells what kind of five pronged approach congress has to fight corruption .

Arrest of Raja by CBI is a tactic by congress , CBI is not a prosecuting agency, it is an investigative agency.If congress was serious , the system would have sent him to judicial custody – I am sure that intelligent people who understand the mechanization of congress , get the meaning.

My biggest worry is that Indian military is getting weaker day by day , and we are waiting for an attack to happen , India could face serious losses and a major setback , if that were to happen. I do hope that BJP will take action . Scams can be handled , may be, even some lost money could be recovered. But if we are attacked by a foreign power and we fail , We would have lost it all.

Congress has to go now and so has to the Gandhi Dynasty from Indian politics . I would suggest BJP to start Egypt like movement so that our Hosni Mubarak’s ( Gandhi’s ) and Mohammad Bin Tugluk ( Manmohan ) go soon , and the country can be put back on track We don’t want our great nation to suffer more .

 Please get your act together

A Common Man

Rajendra Pratap Gupta

http://www.rajendragupta.wordpress.com

Judiciary is as inefficient & as corrupt as its top tier in Supreme Court & the top most politician of this nation


Just ask yourself , why do Chief / Justices of Supreme court, Chief Election Commissioners , Chief of Police , Chiefs of Army etc get plum postings after retirement ? Simple answer – they get return gifts for the favors they do when sitting in the hot seat !!

I was chatting with a senior journalist at the India International Centre , New Delhi a few weeks ago, and he had informed me that, it is believed in political & industry circles that , CJI K.G.Balakrishnan decided Mukesh Ambani’s case just before his retirement and made around Rs.450 Crores !! Well, this may not be just the only judgment to make money !!

Also, we can now understand , why In an embarrassment to former CJI K.G.Balakrishnan, Supreme Court judge H L Gokhale today contradicted his claim that he was not aware that it was former Union telecom minister A. Raja, who had tried to influence a Madras High Court judge in a criminal case

In a statement, Justice Gokhale, who was the chief justice of the Madras High Court at that time, said that in his letter to Justice Balakrishanan, the then CJI, he had clearly referred to the name of Raja.

Justice Gokhale ‘s statement totally contradicts Justice Balakrishnan’s claim that there was no mention of any Union minister in the report sent by Justice Gokhale, then High Court Chief Justice, on Justice S Reghupathi episode.

“I regret to say that the allegations are absolutely incorrect,” Balakrishanan had said last week referring to news reports that he had suppressed a letter purportedly written by Justice Reghupathi to him when he was Chief Justice of India.

CJI K.G.Balakrishnan protected Raja and became a Raja himself after bring appointed to the coveted post of Chairman, National Human Rights commission . Had he not protected Raja and done other favours to Congress , do you think he could have got a Cabinet Minister rank post his retirement ?

Think again , why did M.S. Gill become the Union Sports and Youth affairs minister after retiring as the Chief Election Commissioner ? Gill is in his late 70’s. and his youth passed away decades away !! Does he represent the youth of this country ??

Also reason out , Why did T.N.Sheshan not get any cabinet rank post his retirement ? Why did Kalam not get second term as President ? Why did Kiran Bedi resign before retirement ? Also , the current Judges of Supreme court who have questioned the CWG & 2G scam and taken a tough stand to unearth corruption will certainly not get a cabinet rank position post retirement !!

It is being talked in Congress circles , that the former Chief Minister of A.P., K. Rosaiah had resigned on grounds of poor health , and now he is to be rehabilitated as a Governor of some state. So is Raj Bhawan ( Governor’s residence ) meant to house the sick people ? After all , it is our money ( taxes) that support all such sinecure offices . It’s time to question such appointments .

Why is BJP supporting a sick George Fernandez ( he suffers from Alzheimer’s disease ) as a Rajya Sabha member,  when he cannot even recognise who is Arun Jaitley ? Time to question every such decision which takes our hard-earned money that we pay as taxes to run this government !!

Corruption is a trickle down process and starts right at the top !!

Rajendra Pratap Gupta

office@rajendragupta.in

Mr. Prime Minister , you must go now !


28th November 2010,  via Email

Dr. Manmohan Singh

Prime Minister of India

New Delhi.

Dear Dr.Singh ,

Over the last few weeks, we have seen that that our hard earned money ( about 40 % of our hard earned money goes to government as direct and indirect taxes ) was been looted more blatantly by our own politicians under your leadership than  by Moguls or Britishers  !!

We are ashamed of your leadership, more so, because you are a highly educated Prime Minister . It was hoped that a highly educated person has become the PM , the politics & governance would be without compromise and would improve , but seeing the massive loot of the our money in IPL, Rotting of food grains ,  naxalite problem , unchecked inflation , CWG , 2G & 3G , MCI expose , Adarsh’ & now LIC , it seems that the game of looting the nation will continue unabated . I still recall that you were the first one to back A .Raja last year , when the issue of 2G allocation was raised , you have stood beside him . Now that post the Supreme court intervention , Raja is gone , what are your thoughts ?

This is the first government in the country where the supreme court had to intervene many times and express shock ( remember the supreme court questioning CBI in Mulayam & Mayawati case , telling the government  to give grains free rather than letting them rot !! & now the silence or patronage of the 2G minister !! ).

Dr.Singh, do not forget that the media reaches till the last man in this nation , and when they hear that the Prime minister lead government has looted lakhs of Crores , the reply in 2014 is going to be worse than Bihar.  Over 400 million poor people do not even get one full meal a day & more than 5 million kids die every year of malnutrition !!

Dr.Singh , in history , you will go down as the most ineffective Prime Minister  . You are the only Prime Minster, who was blatantly used & his position repeatedly abused by the Gandhi family . No wonder, Sonia came to your rescue saying that you are 100 % above board, and that your honesty should never be questioned . Dr.Singh , can you raise your hand and say that you are honest and you lead ministers like Sharad Pawar,  A. Raja , Shashi Tharoor etc………..Your integrity and Honesty is just a matter of your ‘ being an educated & learned person’ and nothing beyond. In the last 7 years that you have lead this country , you have denigrated the government institutions & investigative bodies to mere puppets, and systemically allowed the loot to happen just to retain your chair .  Dr.Singh . It is high time that you resigned and moved on and start writing your memoirs ‘honestly’.

I think it  was  a clever ploy to make you the Prime Minister , so that you could share all the blame for the planned loot  , and when it comes to taking credit for NREGA , food security bill or women reservation bill , it would be the NAC headed by Sonia . ……………You should keep this email for your record . Post your stepping down( whenever it happens ) , you will be the first one in the line of fire from the Gandhi family for your inept handling of security , inflation and corruption . They will be the first one to say that could not understand managing a coalition and became morally flexible and allowed the loot of the nation !!

I also urge the opposition ( BJP ) to work on a program to educate the common man, that we must ensure that the congress is out of power for the next 10 years to get this nation back on track ………from 2014 till 2025 we do not need congress at all .

I am sure that all marked in this email will understand the anger of the common man and act as per our wishes !!

A common man

Rajendra Pratap Gupta