India’s state behemoths told to join battle for growth
Manmohan Singh, India’s prime minister, has lit a proverbial fire under the country’s big state-owned companies. He has ordered a $35bn wave of public sector investment – that he will personally oversee – to reverse a decline in the fast-growing economy’s growth rate.
But his top bureaucrats can do much more to get better value out of a state sector that represents a considerable chunk of the Bombay Stock Exchange’s market capitalisation.
India will lose out by keeping out Ikea
Ikea, the Swedish retailer, sells its flat-pack furniture in 26 countries. India is not among them, though China and Russia are.
This should be about to change with a planned liberalisation of retail that will allow single-brand companies like Ikea into India. But it won’t, because Ikea doesn’t like the local sourcing conditions that New Delhi has inserted into the regulations.
Cairn / Vedanta: a test of faith
“It will all be over by Christmas” is a punch-line to a corporate transaction in India that Cairn Energy executives, like those in the trenches of Flanders who bet on quick victory, dare not utter.
The oil and gas explorer has now received all the clearances it needs to execute a $6.5bn deal to pass control of oil fields in Rajasthan to London-listed Vedanta Resources. The way should be clear to complete the transaction in the current calendar year and share the wealth among relieved shareholders.
India: Justice at the top of the pyramid
The special court in New Delhi hosting one of India’s biggest corruption trials has the feel of a cramped departure lounge in a grubby airport that would give sub-Saharan Africa a bad name.
Outside the “lock-up” courts of the Patiala House complex is the sulphurous smell of public toilets and khaki-dressed police commandos with rifles; inside is a hubbub that gives new meaning to the aphorism that “justice must be seen to be done”.
Co-ordinated action Chindia style
India and China have a long way to go to co-ordinate their strategies at the G20, not to mention between their own capitals.
The world’s two fastest growing large economies were at odds on Wednesday about a supposedly shared view on the challenges facing the world economy – and the failure of the developed world to deal with them.
India: go west, young man
Just as young Americans were encouraged to abandon eastern seaboard cities to farm the fertile plains of the west in the 19th century, entrepreneurial Indians are today seeking their fortunes in India’s rural economy.
Uday Kotak, the managing director of the Kotak Mahindra banking group, told beyondbrics that he has recently advised his Mumbai-based head of global securities to take up a new challenge in one of the fastest growing areas of the bank’s business, rural finance.
India: making bigger bets
Now is the season of lights in India where households buy gold and exchange gifts. India’s biggest Hindu festival is also the peak of the informal gambling season.
At the weekend, some friends held a Diwali party at their home in an upscale suburb of New Delhi, the nation’s capital. Once passed the luminous festive lights, the carefully flower petal-decorated stairwell and a dinner table laden with culinary delights, visitors were ushered towards the impromptu gaming parlour.
Even India jumps on RMB band-wagon
India has preferred to skirt the issue of reserve currencies to rival the dollar, generally viewing the US currency as irreplaceable in the near term.
The top policymakers in Asia’s third largest economy have considered China’s promotion of the renminbi as a possible alternative as opportunistic and unhelpful at a time of global financial instability.
Bric euro rescue: a rush job?
Evidence from India that the Bric plan to rescue the eurozone is being put together in a hurry: “The idea has been thrown at us by the Brazilian finance minister,” R Gopalan, a senior Indian finance official, told the Financial Times on Wednesday.
He declined to say how India might respond but said it would wait to see what was discussed at the planned Bric meeting in Washington next week. With China, which has the world’s largest foreign exchange reserves, also very cautious, it seems the Brazilians will have a lot of persuading to do.
India: The Maharaja has no clothes
Like the confidential US cables released by Wikileaks, devastating reports by India’s Comptroller and Auditor General spell out what everyone fears to be true but dare not put in words about the running of the Indian government.
The two reports, released on the last day of a tumultuous monsoon session of parliament, have thrown a scorching spotlight on India’s civil aviation and oil ministry, and the leading companies in these two sectors.
India: Manmohan lifts veil on ministers’ moolah
There is much India’s anti-corruption campaigners could do to help clean up governance. One improvement would be a regularly updated and credible register of assets held by parliamentarians.
Prime minister Manmohan Singh has made a start with a regularly published account of his ministers’ earnings. At the weekend, his office went further, releasing a list of assets held by cabinet ministers. The figures are likely to raise eyebrows.
India: come with a firm mind, strong constitution – and malaria pills
The human cost of doing business in India has been known to multinational employers for centuries.
Niall Ferguson, the Harvard historian in his book titled “Empire” describes how in the days of the British East India Company fortunes and careers were made in India.
Putting words in Mr Singh’s mouth
When Manmohan Singh, India’s prime minister, speaks to the nation from the battlements of Delhi’s Red Fort on his nation’s Independence Day on Monday, he will not be short of a script.
In past days, columnists have imagined themselves in his shoes and penned their own speeches for the 79-year old prime minister to best capture the national mood by making a clean breast of the corruption that has hit the telecoms sector, the Commonwealth Games and the military.
Indian cricket: heaps of money
India’s cricketers have been deafened by howls of derision after their latest defeat by England in a four match Test series.
Sunil Gavaskar, a former Indian batsman, said his countrymen were playing like “schoolboys”. Geoffrey Boycott, a former English cricketer, called their performance more befitting Bangladesh than a team currently ranked No 1 in the Test tables.
Before we feel too sorry for India’s struggling cricket stars, we should remember that they are paid for success and vicissitude alike.
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