A dollar devaluation by another name

Devaluations can be addictive

British Prime Minister Gordon Brown said on Tuesday there was substantial support among the Group of 20 nations for creating a new framework to tackle global economic imbalances … Analysts said the United States’ drive to agree a roadmap for a more balanced global economy could meet resistance from China which is unlikely to agree reforms that would threaten its growth … A document outlining the US position ahead of the September 24-25 summit said big exporters, which include China, Germany and Japan, should consume more, while debtors like the United States ought to boost savings … The euro hit a one-year high against a sliding dollar ahead of a federal reserve meeting and the G20 talks on rebalancing, a process which is likely to require a weaker dollar.

Like Quicktake has pointed out in earlier posts, the US has alternated between an overvalued currency to gain ownership over large sections of world economy – and now with a devalued dollar, it seeks to gain an upper hand in merchandise exports. The three main points that one needs to understand are: –

One – It reduces the real value of US debt. The Chinese, the Rest of BRICS and the Others need to be paid a lot less in the future. (as pointed out earlier in various posts linked here.) Two – It makes US exports artificially competitive. (as pointed out earlier in linked posts). Three – The US competitiveness will be anchored to assets purchased with over-valued dollars.

Factor	US	Germ any	Japan	China	ASEAN	India
Labour	High	High	High	Low	Med.	Low
Welfare Costs	High	High	High	Low	Med.	Low
Entrepre neurship	Med.	Med.	Low	Low	Low	High
Domestic market	Large	Med.	Med.	Med.	Small	Large
Raw materials (Self-owned)	High	Low	Low	Med	Med	Med

What the US is proposing is that the Chinese Yuan must become ‘stronger’ – and the dollar must become weaker. This will mean a real reduction in US debt – and a subsidy for US exports. Of course, a devaluation has never helped any regime in the long run – but in the short run it reduces imports and increases exports. But is a ‘fix’ that the patient begins to row dependant on!

Is that the US is wanting to do to itself?

Related Quicktakes

Toward a robust globalisation

Fitch cuts Russian debt rating, sparks memories of ‘98 crash- Internation…

Leadership in the Developing World

Khap panchayats seek legal claws

The real tehelka is that local-khaps is the way forward – and not centralized government regulation.

A over-regulating state is also ineffective state (‘Prohibitions’ cartoon and ©by Meera Sapra)

Irked at being equated with the Taliban and kangaroo courts, khap panchayats in Haryana are now determined to get some legal sanction.

Soon, they will draw up a set of recommendations for making “suitable” amendments to the Hindu Marriage Act (1955) at the state level so that their rulings become valid under law.

Khaps are traditional area-based community organizations whose rulings have no legal sanction. In keeping with tradition, khap panchayats oppose marriages within the same ‘gotra’ (lineage) and are known to have meted out harsh punishments to “erring” young couples. (via Khap panchayats seek legal claws – India – NEWS – The Times of India).

‘Indian’ NGOs

A NGO /activist publication recently ran an article on Haryana’s khaps – equating the khaps to the Taliban. This was the famous ‘Tehelka’, whose main aim in life is to show how ‘backward’, ‘ignorant’, ‘uncivilized’ the India(ns) are.

Of course, being ‘English speaking ‘activistas’ of the ‘civil society’, nobody can doubt their intentions or message or their ‘intelleigence. Except some like 2ndlook – whose ‘provincial’ mind’ (aka मोटी, देसी और मंद बुद्धि) cannot reconcile the ‘de-regulation’ that these NGOs want and greater regulation that they propose – as they exhale and inhale.

Of course, since they are ‘educated’. ‘modern activistas’ without any axe to grind, they must be right. What is the data that they have? This story was linked to me by an 2ndlook reader (novaaristotle) and is worth reading for an excellent hatchet job.

In conversations with villagers over weeks and months, it became clear that murders decreed by Khap panchayats were common. However, in most cases, a twisted notion of tradition and the fear of social boycott ensure the murders are never reported to the police or the media. The National Crime Records Bureau (NCRB) doesn’t classify or record honour killings and hence has no statistics on them. The lack of figures on murders ordered by Khap panchayats or ‘honour killings’ hinders research and legislation that might address the issue.

Maybe, they should look take a 2ndlook at Indian society – from a law and order point of view.

All quiet on the Indian front …

In more than 1000 Indic books, claiming to record more than 10,000 years of history, there is no instance of any dispute reaching the King. The longest ancient epic in the world, The Mahabharata has no incident where a private dispute reached Yudhisthir (though a mongoose could lecture the King about sacrifices and yagnas). There was never any case of private dispute, recorded in the Ramayana, that reached Ramachandra (though a dhobi could ‘inform’ the king about bazaar talk regarding the Queen Sita). Even a poor Brahman, Kautsa, could reach King Raghu for help in the disbursal of guru-dakshina गुरु-दक्षिणा.

Is it that Indians were ‘saints’ and did not have private disputes? Were they so civilized that they could solve all disputes by talking to each other? Is it that Indian kings were not bothered about delivery of justice!

It gets worse! No prisons …

Modern econometric modelling has an interesting perspective on Indian economy where research shows that for much of the last 1000 years, India has been a significant economic power till the 1900.

China and India, this analysis estimates, for the last 1000 years, accounted for 50% of the world economy. Statistical analyses showed India with a world trade share of 25% for much of the 500 years during 1400-1900. With this prosperity, the most interesting (historical) aspect of the criminal management story is the absence of any surviving mass jails in India prior to colonial India.

Without prisons, just how did pre-colonial India, one of the largest (and most prosperous) populations of the world, deal with crime and criminals?

But then crime rate in India must be really high …

Cut to modern India. With such an inheritance, India has the lowest prison population in the world. How can India have such a low prison population, with a poor police-to-population ratio and a crime rate which is not above the average – in spite of a large civilian gun population.

All the 5 indices (below) create a bias for a lawless Indian society and rampant crime. With these five indices, namely: –

1. Police to population ratio (‘increase police force’)
2. Prison population (‘put more criminals behind bars’)
3. Capital punishment (‘kill enough criminals to instill fear’)
4. Poverty (‘it is poverty which the root of all crime’)
5. Gun ownership (‘more guns means more crime’)

against a stable social system, how does current day India manage low-to-average crime rates. More than 2000 years ago, Megasthenes a Greek traveller to India wrote,

Theft is of very rare occurrence. Megasthenes says that those who were in the camp of Sandrakottos, wherein lay 400,000 men, found that the thefts reported on any one day did not exceed the value of two hundred drachmae, and this among a people who have no written laws

Historically, trade in India is governed by शुभ लाभ ‘shubh labh’ – and hence Indians have not been major players in drugs proliferation (unlike Japan, the West in which traded Opium in Korea and China) or in slave trade.

In modern times, India is not a big player in spamming or in software virus – though a power in computing industry. In August 2008, a hoax story alleged that an Indian hacker, had broken into a credit card database, and sold it to the European underworld. Some ‘experts’ feared that this would spark of a crime wave across Europe.

The Indic model of justice, crime and law

Evidence of a different Indic system goes far back in history – to Lipit Ishtar, Hittite laws, Hammurabi et al. As far back as 4000 years back in history. Indian kings did not deliver justice. It was done at the local level by panchayats पंचायत. Indian justice systems did not rely on imprisonment or executions or the police to control crime!

The answer – the world’s most stable marriage system and the extended family-social structures took care of the wayward. The khaps may have gone overboard in some cases (based on anecdotal evidence) – but the real tehelka is that khaps is the way forward.

And not more government regulation.

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Related articles

• Government does a khap by raising the age for sex (dailymail.co.uk)
• Why Are Hindu Honor Killings Rising in India? (time.com)
• Deeply Offended (saintptbarnum.wordpress.com)
• Situation in Hisar remains tense as Jats sticks to their demand (thehindu.com)
• Jats finally call off agitation, remove blockade (ibnlive.in.com)

U.S. Leads World In Foreign Weapons Sales – Report – NYTimes.com

Citing a congressional study released on Friday, the Times said the United States was involved in 68.4 percent of the global sales of arms.

U.S. weapons sales jumped nearly 50 percent in 2008 despite the global economic recession to $37.8 billion from $25.4 billion the year before.

The jump defied worldwide trends as global arms sales fell 7.6 percent to $55.2 billion in 2008, the report said. Global weapons agreements were at their lowest level since 2005. (via U.S. Leads World In Foreign Weapons Sales – Report – NYTimes.com).

Can you stop me ...

US in the Post WW2 world

In South East Asia from 1950-1975, Israel from the 1960 onwards and now in Iraq, Afghanistan, the US has been the in the middle of most expensive conflicts (measured in terms of lives lost) in post WW2 world.

This model of international relations is something that needs to change. The poor in this world has not become much safer, seen more democratic or significantly more richer. What justification does this policy have – apart from “I have muscles and can you stop me from flexing them” logic?

Gold – a non-military solution

As I see it, there are two simple solutions. One – everyone who disagrees with (or even if  you are worried about the economic consequences of) the US foreign policy should go out and buy gold. This will surely trigger a collapse of the US dollar. Just a 100,000 people buying a 100gm of of gold in the next 1 year will trigger the dollar collapse.

Drill for oil

The second solution will need more time and will need co-operation foron the BRIC Governments. The BRIC Governments must go out and drill oil wells all over the developing world. The collapse in oil prices will remove the petro-dollar funding of the US and simultaneously eliminate /reduce the trade deficit of the developing world.

Election funding, India-Pakistan jigsaw mash up

Army Chief Mirza Aslam Baig had advised the ISI in September 1990 that it should give logistic support to transfer of funds from the business community in Karachi to the IJI during the 1988 election, the report stated.

Durrani said in the affidavit that he opened several bank accounts in Karachi, Rawalpindi and Quetta, the daily reported. A man from Karachi called Younus Habib had deposited Rs140 million in one of the accounts in Karachi. Some of the amount had been transferred to the accounts in Quetta and Rawalpindi and the rest to a special fund, according to the report.

According to the affidavit, submitted before the apex court on July 24, 1994, former caretaker PM Ghulam Mustafa Jatoi received Rs 5 million, former Sindh Chief Minister Jam Sadiq Rs 5 million, former Prime minister Muhammad Khan Junejo Rs 2.5 million, Nawaz Sharif Rs 3.5 million, the Jamaat-e-Islami Rs 5 million, and Lt Gen Rafaqat Rs 5.6 million for managing the media campaign. There were many other names on the affidavit. (via Nawaz, others got money from ISI: Pak ex-CJ).

Power, pelf and wealth

Bribes to politicians are neither unique or a monopoly to Pakistan. Funding of power struggles is a part of polity – and is more a problem of the structuring election funding, rather than the moral fibre of politicians.

The Lodis from Afghanistan, petty horse traders, regained India from West Asian invaders. The Lodis could do this, by reducing the cost of raising an army. Being horse traders, they access to low cost horses, essential for a large cavalry-based armed forces of the time.

The Afghan Lodis ended the short 200 year stint in Delhi by the frequently defeated West-Asian invaders. Western historians have painted the Lodis as Islamic conquerors – without differentiating between Indian-Muslim rulers and West Asian Muslim rulers. Afghanistan was last ruled by the rulers of Punjab – Maharaja Ranjit Singh, till about 1830s.

This brings to mind two things.

Political funding in the West

All political systems must necessarily create a system for funding access to power. ‘Modern’ democracies have no systemic channel for funding. Those who follow the ‘system’ – are left behind by those who break it.

The Roosevelt family fortune was built on opium ‘trade’ with China. The Kennedy families fortune was built on initially bootlegging (smuggling alcohol) and Wall Street shenanigans (sold all his shares just before  the Wall Street Crash) and Hollywood capers (Alexander Pantages affaire). In each case, he turned legal – and started a alcoholic-beverage distribution company (Somerset Importers), SEC Chairman, Ambassador to Britain.

He ensured his son, JFK, became the only and ever, Catholic President of the USA. Behind Robert Kennedy’s appointment appointments as SEC head and Ambassador to Britain, was FDR – whose own family fortune was made by marrying rich and opium ‘trade’. Takes one to know one.

The much whispered and well-known funding of political parties by the Reliance Group or the well-oiled PR machine of the Tatas in India are another example.

Funding of Elections

A simple expedient would be to set up a tax-payer funded corpus, for each Parliamentary, State Legislature and local Government constituency – which would get proportionately divided between the top 5-7 candidates, based on votes polled – subject to a ‘clean’ record.

Based on a 500 (central Government), 5000 (state legislature) and 50,000 (local Government) constituencies, and a corpus of Rs.5000 crores each for Central /State /Local Government politicians, to be distributed every five years, would immediately clean up Indian politics and bring in a whole new breed of politicians. The annual cost of such funding will be Rs.3000 crores at current cost – which is far lower than the estimated ‘bribes’ that Indian politicians presumably collect.

To believe that a nation can depend on a constant supply of Tilaks, Boses, Gandhis, Vinoba Bhaves, et al is niether real nor possible.

Can Pakistani business clean up Pakistan

The other thing is the use of Pakistani business interests to clean up Pakistan. Mahbub Al Haq made a famous 22 families in Pakistan speech – which detailed how some 22 families in Pakistan control the Pakistani economy. India can provide a huge market, opportunity and growth to Pakistani businesses.

Is there a coherent anti-terrorism strategy? Is Indian diplomacy engaged with this segment of Pakistan – to find ways to clean up Pakistan. Are Indian banks, consortium-members that fund Pakistani businesses – which are on a “White’ list?

Or Indian diplomacy too busy engaging with the Unca Sam and the West?

The bubble you know

A Chinese bubble has been deflated. Too bad it’s the wrong one. The main Shanghai stock market index has fallen 23% from its peak at the beginning of August, reversing half of the run-up that started early in 2009. That’s a welcome correction, but it doesn’t mean a return to normality, or address the bigger bubble round the corner.

Shares were driven up by a belief in China’s recovery – and by a rush of liquidity. The fall occurred because both were gently dampened. Politicians have warned that economic recovery isn’t a done deal. Monetary authorities drained some liquidity from the market, curbed certain kinds of lending and asked banks to show restraint. (via The bubble you know).

Look ma, "Green shoots"

The long and short

The US economy is going to take some time to recover – a long time. Green shoots versus Brown Weeds is the kind of empty debate which covers the complete lack of visibility on the probable outcome that economists have.

The Japanese have finally decided to sack the LDP – after more than 50 years. The Japanese do not expect any major recovery or growth to happen for the next few years.

Europe is in the boondocks – and is unlikely to come out out of this soon. Their most feasible European option is a greater role for public sector – which the Europeans seem to have embraced in a bear hug.

The BRICs of global economy

Which leaves the BRIC countries. Russia is too dependent on high raw material prices – which need greater demand from the world economy to make a difference. Russia feeds on high growth rates – but cannot be the reason for growth of the global economy.

Ditto for Brazil. Which leaves the world with India and China. Let us first take the Chinese case first.

How ln can this model work

Biting the bullet

Most economists believe that to kill the Beast of Great Recession, the world is left with one, single  magic bullet – China. This being the only bullet in the chamber, makes everyone very nervous, keeps everyone busy, reading Chinese tea leaves with great care.

There is overall consensus that the Chinese growth figures need to be ‘tempered’ – and significantly. The fears seems to be in two areas: –

1. Overstated growth rates.

“The Chinese government is one of the few governments in the world that knows its GDP numbers three years in advance,” Marc Faber told CNBC. Combine this with the other preoccupation where “China is desperately trying to figure out how to withdraw its funds from the dollar without driving it down — not an easy feat.”

2. Understated bad loans by banks.

an astonishing $300 billion vanishing act … the amount of bad debt the top three banks offloaded in the early 2000s. Back then, the People’s Bank created four asset management companies to scrub away the dirt from two decades of policy-driven lending. There was a big catch. The AMCs bought the loans for up to 100 per cent of face value, while recoveries were in the 20-30 per cent range. That means the top three lenders’ Rmb1.2 trillion of AMC bonds, which start to mature this year, are likely to be almost worthless. In theory, the Ministry of Finance is ultimately on the hook, but it is unlikely to make good for the banks. The amount due to all three is roughly one-sixth of China’s fiscal revenues for 2008. (from If in doubt, rub it out BY John Foley /  August 29, 2009, 0:03 IST).

Housing makes up roughly a quarter of investment spending, which is in turn 40% of gross domestic product. The differences between China’s big cities make a bubble harder to spot. But record bids for land are cause for concern, as is falling affordability in big cities. Meanwhile, stagnant residential rents suggest speculation, not demand for somewhere to live, is pushing up house prices. A burst real estate bubble could be fiendishly tricky to clear up. While stock markets clear in a day, property gluts can take months – if they clear at all. ( from The bubble you know by John Foley, Septemeber 1st, 2009, 01:33 IST).

Everything is made in China

Both these severely strain the economic outlook and the banking sector. This may lead to, what the WSJ.COM says, a situation, where “China in the medium term will face just the overcapacity and bad debt that many observers feared already existed.”

But some of these observations and scare stories are exaggerations – and need to be read with the caveat that the dominant Western media portrays all competitors in a similar manner.

What about the Indian economy

That pretty much leaves India as the sole candidate. India cannot absorb the kind of imports that are required to make a difference to the global economy. Or boost exports to the rest of the world – to create consumer led growth. World Bank estimates are that India will grow faster than China by 2010. So, no go!

A plan for Indian businesses

What this means is that India needs to do: –

1. Not bank on any kind of global recovery soon.

2. And island itself – by ensuring that any kind of global mayhem, counter-party risks do not hit Indian banks, corporates, exporters, et al. This may need some strong alliances on export guarantees and credit enhancement by importers for exports from India.

The Indian Government, may not take any major initiative in this regard, but it is the Indian businessmen, who should and must understand this situation – and take the necessary precautions, actions, insurance, guarantees, due diligence, comfort letters – the entire gamut.

Indian Mosaic and the Western Melting Pot

West has the lowest levels of ethnic, linguistic and religious diversity persecutes whatever little is left. E.g. Roma Gypsies.

The US Melting Pot

“However, India’s nation-building process differed markedly from the classic 19th-century European model. European nations flattened diversities. We now know that at the time of the French Revolution, only 10-12 % of France spoke French. Over the next 100 years, public schools and conscription armies turned “peasants into Frenchmen”. France simply did not allow diversities to flourish. Everyone came to speak French.

Under Gandhi, India consciously embraced diversities. Even though Gandhi thought that Hindustani — a combination of Hindi and Urdu — might become India’s lingua franca, the idea that India would be a multilingual nation soon took control of his political thinking. And the notion of embracing diversities was quickly extended to religions and castes.

Experience told Gandhi that most Indians had at least two or three identities. They were Bengali and Indian, Tamil and Indian, Hindu and Indian, Muslim and Indian. To push either fragment too far was to go against the requirements of Indian nation-building. Building a classic European style nation was simply not a practical option.

Thus was born the Congress model of politics, which was indistinguishable from nation-building. Today, we call this the “mosaic” model of nationalism, as opposed to the “melting pot” model. The latter term is often used for the US, but recent scholarship makes it clear that France is the biggest melting pot in the world.” (via No place for extremes in the Indian mosaic – Special Report – Sunday TOI – NEWS – The Times of India).

Ashutosh Varshney, in the article linked above, makes the distinction between ‘mosaic’ and ‘melting pot’ very well. Looking deeper, one, however needs to qualify his thesis.

Lowest diversity vs.Biggest talk

The West today has the lowest levels of ethnic, linguistic and religious diversity – and persecutes whatever little is left, like the Roma Gypsies for example. Would critics like to mention any other country, where such a large minority Muslim population, has greater freedom and opportunity, than in India? Would you like to suggest France instead?

The US melting pot

The language conundrum

India, has 15 official languages.

No other countries even had the courage to think of that. Various US state governments outlawed all languages – except English.

It was only in 1923, was this finally set aside after the matter reached the US Supreme Court (read Meyer vs Nebraska). The USA gathered some courage to start timidly with more than English only after seeing India’s success with 15 languages. Switzerland has only four. Sri Lanka’s Sinhalas do not want to accept Sri Lanka Tamils as full and equal citizens – hence the 20-year-old civil war.

In the thrall of One

The Western concept of nation building requires the cornerstones of Desert Bloc – One God, One Book, One Holy Day, One Prophet (Messiah), One Race, One People, One Country, One Authority, One Law, One Currency, One Set of Festivals. This tyranny of the ‘One’ is the root of most problems in the world. From this ‘Oneness’, we get the ‘One’ Currency, ‘One’ Language logic  – a fallacious syllogism. Once you accept ‘One’, you will accept all others.

Manick Sarkar – does magic with cartoons also

Before finished saying M

While Ashutosh Varshney makes the distinction between ‘mosaic’ and ‘melting pot’ very well, he misses the beat, completely, by crediting Gandhiji for this Indic construct! When he says, “Under Gandhi, India consciously embraced diversities” is he implying that before Gandhiji, India was a mono-bloc society.

Was it under the thrall of ‘One’?

Would Gandhiji have become a Mahatma in India, if tried the ‘melting pot’ strategy?

I think not!

He would have been rejected, rubbished and trashed before he could have said M.

Of mosaic, melting or Mahatma.

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Sunita Narain proposes more Government

Dilbert knows all ...

we bought samples of leading brands available in the market and analysed content for the toxin. What we found was staggeringly high levels of lead in virtually all samples we checked. India does not have a mandatory standard for regulating lead in paints. We only have a voluntary code laid down by the Bureau of Indian Standards (BIS), which specifies that lead content should be 1,000 parts per million (ppm). Our tests found that the biggest and best companies had lead levels 180 times the voluntary standard.   

But we were not surprised, as I said. After all, the government has not set standards to phase out lead in this daily-use product. Something most governments had done some 20 years ago. In the US, lead had been termed the number one environmental threat to the health of children. But it was a non-issue for the industry in India. We were angry at this indifference and decided to write to all major paint companies asking them about their plans to phase out lead. We expected little response. But this time we were really surprised.   

Two of the major companies — Asian Paints and Nerolac — wrote back saying that they were planning to get rid of lead. They promised that this would happen soon, within a few months. So, instead of immediately releasing our report, we thought we should wait: To recheck and to validate if the companies kept the promise they had made to us. Some months later we went to the market and picked samples of the same companies.   

Our analysis found a change. Of the big five, three companies had no lead in their product. Asian Paints and Nerolac had indeed cleaned up. Berger and Shalimar still had lead in the samples we tested. Both are big companies and neither have any excuses. The fact is that companies have the technology to phase out lead. (via Sunita Narain: New coat of paint).   

Failed agency, failed agenda, failed model

Actions matter

 Much as I like Sunita Narain’s work, her reading of this situation is wrong.   

Unlike her fault-finding, this was good news. For three reasons.   

1. Three out of the five biggest companies voluntarily agreed and reduced lead content – at a significant cost to their own bottom-lines. Without a sword over their head or legal threats hanging over them. Just a gentle pointer did the trick. That is good news. This is possibly why Indians trust their companies more than the Rest of the World.   

2. The Government has voluntary codes – which are NOT enforced. Unlike the US. We should do more of this – and not less, Ms.Sunita Narain. Bigger Government, with greater enforcement agenda is a bad idea – and no good can ever come out of it.  

EPA does nothing about Environment and Justice does nothing to do with justice

For you to call for greater Government activism is simply more bad news. The American model is faulty, expensive and prone to abuse. Why copy a failed model?  

3. Ms.Narain – Maybe, your organization can franchise a ‘प’ (Prakriti) logo – for all companies that voluntarily adhere to the highest global standards. And that will again be good news.   

Let us take away the regulatory load (which will soon become overload) from the Government and move towards self-regulation.   

I think it is time you took a 2ndlook.   

Related Articles

• How India’s Success Is Killing Its Holy River (time.com)
• Tussle over forests shows India’s growth dilemma. (in.reuters.com)
• What They Said: The Bhopal Tragedy (blogs.wsj.com)

Climate change – How India is falling for propaganda

Polluter cleans ... and Pollutor pays and gets away

I have been surprised by the number of reasonable Indians who have come to accept the proposition, advanced by equally reasonable but perhaps nationalistically-motivated Americans, that the acceptance of internationally-mandated restrictions on carbon emissions by India is in its own national interest. Some have even come to argue that India should actively seek a climate change treaty at the Copenhagen conference in December 2009.

If the big and largely rich emitters of today were to take mitigation in the immediate future seriously, they could achieve emission cuts commensurate with the recommendations of the Intergovernmental Panel on Climate Change (IPCC) without denying the poor in India (and Africa) the prospects of a humane existence. With abject poverty eliminated and electricity and water provided to all, India could join the mitigation effort by 2040. (via India and climate change talks).

Acquisitive Indian companies making US nervous?

What if

The entire global warming debate is just a facade to keep up demand for oil from India and China. The opposition to coal fired power plants is to stop India and China from reducing the growth in oil consumption.

After all practically all of British GDP today is declining North Sea oil and British Petroleum. Apart from Chinese money, the other source of liquidity, which keeps the US afloat is petro-dollars. And, remember, US future is so closely linked to Arctic oil. If India and China were to reduce their reliance on oil, leading to a price collapse, the biggest losers will be the Anglo Saxon bloc.

Makes one think!

India’s pharma exports

Three things…

First, many of the regulatory bodies are actually a US-Euro Club – to fool the world, with token actions and steps to demonstrate inclusion and fairness to the developing world.

And second, these token actions divert the attention of the developing world. For instance, World Bank list of banned entities were significantly, from two sectors – Software and Pharma. These are the two sectors where the US still has a lead – and the Indians are its biggest challengers. Generic pharma firms from India have become world beaters – and the Indian software companies have built up US$50 billion a year business, in less than 10 years. These 50 billion dollars have come out of (arguably) US pockets.

At least, the actions against Wipro and Nestor Pharma were pathetic excuses to ban a business – and no third party arbiter will uphold these actions.

Third, on January 9, Standard & Poor’s announced that Greece, Spain and Ireland were on review for a possible downgrade, indicating that a Euro-zone country could default. The cost of the US bailout is likely to exceed US$3 trillion. Current US budget deficit is likely to break all records and estimates.

Not so long ago …

In 1999, an employee of an auto-components manufacturer, Autolite, was arrested in France for trademarks and copyright infringement – based on a complaint by the car manufacturer PSA Puegeot Citroen. The French police, on similar complaints, arrested two other nationals, a Belgian and a Taiwanese woman also.

The Belgian was of course granted bail – and the Indian and the Taiwanese were denied bail – ‘The lawyers representing the Indian businessman offerred to deposit his passport and the sum of 100,000 French Francs claimed by Peugeot in the custody of the court as bailbond, pending the trial of the case on November 12′.

French court procedures took nearly 1 month and the Indian executive was finally granted bail after being in prison for 1 month. After two years of appeals and expensive litigation, the complaint was found to be without any merit – and dismissed.

When the North Pole greens over

More recently …

A shipment of medicines destined for Brazil, from India, was detained at Rotterdam. The Dutch Customs used a complaint from a local Dutch company, to detain this shipment, based on local patent laws. After a few months of ‘negotiations’, the shipment was sent back to India. An expert writes, what

‘EU is doing is using Council Regulation (EC) No. 1383/2003 to impound drugs that are suspected of violating patents registered in member-countries even if these are simply in transit. The regulations permit customs to hold these goods for a minimum of 10 working days while informing the patent holder of the seizure. The patent holder then applies to a civil court to initiate legal proceedings in order to prove that infringement has taken place.’

Whats the Quicktake

These seem like offensive actions from the EU and the US – to undermine their competitors and to bolster Euro-US businesses. It makes me doubt the Satyam saga. To carry the conspiracy theory thread forward, was there a Merrill Lynch-Ramlinga Raju ‘deal’?

'demmed' Indian cows

Modern day protectionism, huh?

This also furthers the importance of having non-Western bodies, which are sponsored by the Third World, which will regulate and govern international laws. To depend on the West, is to further dig the hole that the Third World finds itself in.

And in case you forget, remember that for some time Indian cows were blamed for global warming!

The ‘Stupidity’ of election fraud in poor countries

In the last few months, we’ve witnessed elections in Zimbabwe, Iran, and now Afghanistan, and in each case the heavy-handedness on display has been staggering. Can’t these people at least show a little finesse when they’re practicing ballot-box fraud? (via The Unbearable Stupidity of Authoritarianism – Erik Tarloff).

Zimbabwe et al are known cases

Western media, Erik has done enough to ‘showcase’ Zimbabwe – amongst others, which you highlight, with so much relish, in your post (linked above). Though, I wonder why you don’t, in the same breadth, compare the continuing frauds in your home country. Is it that election fraud in the US is more ‘intelligent.’

The 'Brooks Brothers' Riots

How about the US

The disenfranchisement laws in the US are, if any comparison is required, more unfair, have been running longer and engender greater injustice. How about a ‘fair’ comparison!

The disenfranchisement laws came into effect by the 1890’s – that continue till today. This ensured that a disproportionate number of African-Americans could not vote. After some 60,000 African American Voters were disenfranchised, George Bush technically, won by less than 1000 votes (most of the disenfranchised voters were expected to vote against George Bush). And George Bush became the President of the USA for the second time. Or would you like to talk about the hoods and goons in the ‘Brooks Brothers Riots’ – employed by the Republican Party!

If this post, fills your need to feel superior, find better targets. At least, your equals! Why pick on poor Zimbabwe!

If your quarrel is ‘finesse’, I wont join in the debate.

Shashi Tharoor patterns Indian foreign policy on US-Israel template

As President-elect Barack Obama prepares to take office this month, he has avoided the fawning praise of India that has become fashionable in some Washington circles. But experts on the region say that India-US ties now have a momentum of their own. Industries in each country now have a vested interest in deepening ties with their counterparts.

“In 20 years, I expect the Indo-US relationship to resemble the Israel-US relationship, and for many of the same reasons,” said Shashi Tharoor, an Indian writer and former undersecretary general of the United Nations. (via Will the love-fest stoked by Singh, Bush bear fruit? – Economy and Politics – livemint.com).

Am I missing something here? Look at the cartoon date!

Why is the Israeli model a bad idea

The first disqualification against accepting the Israeli State model is the fact it is heavily dependent on America, for fiscal and military aid – which “since 1974 totals roughly $80 billion”.

Do I sense envy when an article from Daily Times Of Pakistan says “The United States has poured $140 billion into Israel since its formation”. That is about a US$56,000 for every Israeli family.

Is this what you learnt at the UN Tharoor Saar …

First, did it ever occur to Tharoor Saar to check where is the guarantee that the US will be in a any position to underwrite India’s long term requirements?

After satisfying himself, did Tharoor Saar ever ask, “Why would the US underwrite India?” In case of Israel, the US had good reasons. After all, (as NYT says)

America has vital long-term strategic interests in the Middle East. The gulf has well over 60 percent of the world’s proven conventional oil reserves and nearly 40 percent of its natural gas.

To some it may look like a boon, but is surely the kiss of death.

American policymakers began regarding Israeli strength as an American asset in the Cold War, they supported significant aid as a matter of strategy, not charity. … American aid continues to flow to Israel. … critics on the opposite end of the political spectrum argue that while aid to Israel may be tied to the best of intentions, it does more harm than good to the Jewish State by propping up a big and inefficient government and making Israel dependent upon the U.S.

For how long can any country, society, individual survive on foreign largesse? Note how during the 1973, Arab Israeli War, the tide of battle finally turned when the massive US airlift of weapons, tanks, spares happened! Which itself, is self-serving – “American assistance, emerging as a disjointed policy that urges a peaceful resolution to the conflict while boosting military aid to Israel.”

Another client state of US, Pakistan enviously records, that

“Israel is the only country that receives all of its U.S. aid in a single package, while others only receive it in quarterly installments.” It continues, “Most recipients of military aid are obliged to spend it in the US but Israel is permitted to spend 25 percent of what it receives to subsidize its own defence industry,”…

Doubtful motives, suspect intentions

Three aspects of the Israeli behaviour makes Israeli intentions doubtful.

One – Israel surely knows that US support cannot continue ad infinitum. What will be the Israeli response after they stop getting US support?

Two – After consistent and constant efforts to make enemies, over the last 50 years, how does Israel plan to continue living in a hostile neighbourhood – without American aid?

Three – With a population of little over 50 lakhs (5 million) in Israel and a world Jewish population of less than 1.3 crores (13 million), how does the Jewish population stop itself from going extinct?

Is there a pattern …

Tharoor Saar’s statement needs to be read in light of two other incidents. For starters, read Manmohan Singh’s speech at Oxford, praising the Raj,  while receiving his honorary doctrate. Continue with Chidambaram’s decision to end “abject poverty” in India that he seems to “have known for 5,000 years.” And now add Tharoor Saar’s stated objective to make India into a US-client state in another 20 years. Are these three incidents stray and unrelated? Do they form a pattern?

Any which, Tharoor Saar’s thinking is a cause for concern.