India’s latest $29bn corruption scandal
The ill-fated 2010 Commonwealth Games were meant to be the country’s international coming-out party – à la Beijing’s 2008 Olympics – but are best remembered for $80 rolls of toilet paper, ineptitude and allegations of widespread graft.
So it is perhaps unsurprising that one of that boondoggle’s biggest projects has now come under the scanner, with the Comptroller & Auditor General of India alleging a $29bn corruption scam surrounding the modernisation of the Delhi Airport. Continue reading »
India: a primer on “black money”
Tax all of the illicit money stashed abroad by India’s rich and powerful and the government can wipe out its near-record fiscal deficit, according to a new report.
Using an estimate that the annual amount of so-called “black money” generated each year is about 20 per cent of India’s GDP, Akhilesh Tilotia, of Kotak Institutional Equities, makes a simple calculation in a report released on Tuesday: tax it at the appropriate 30 per cent and you get 6 per cent of GDP in tax revenues, just over the projected 5.6 per cent fiscal deficit. Continue reading »
India: squeezing the 2G auction pips
Less than a month after India’s telecoms regulator shook up the industry by announcing sky-high 2G spectrum prices for the upcoming auction, and on the same day that new research suggested such prices would put operators a further $50bn into debt, apparently the government isn’t quite satisfied – the rates, it seems, were not quite steep enough. Continue reading »
Rupee at (yet another) all-time low as the 55 threshold is breached
The rupee continued its descent late Monday night, reaching its fifth consecutive all-time low and crossing the psychologically significant Rs55 barrier – at Rs55.09 against the dollar.
By 10:05am Tuesday morning, the rupee was trading at Rs54.95, as exporters sold dollars into the market in compliance with a Reserve Bank of India directive that they sell half of their dollar reserves. Continue reading »
India’s opaque censorship
Indian TV fans anticipating a free download of the latest episodes of Mad Men and Game of Thrones on Monday morning, hours after they aired in the US, found themselves out of luck, as a seemingly ad hoc and arbitrary clampdown on file-sharing sites continued. Continue reading »
M Stanley cuts India growth forecast
As recently as a year ago, the Indian government was forecasting 9 per cent GDP growth, but with each passing month, it’s looking like they have read that figure upside down.
Morgan Stanley on Monday became the latest authority to downgrade India’s growth forecast, revising its 6.9 per cent projection for the fiscal year ending in March 2013 to 6.3 per cent. Continue reading »
Air India: call for the doctor
Anyone who has ever tried to fly Air India and found themselves delayed by hours, or harangued by surly staff, knows that the state carrier has been on life support for ages – and has probably thought that it was time for the government to pull the plug. (Alas, less than a month ago the government threw it yet another lifeline by clearing a $5.7bn bailout package to help the carrier cope with its $8.3bn debt.)
But this week, it was Air India’s pilots who seemed to be in need of medical attention, as an epidemic of inexplicable illness swept through their ranks, knocking out first 100, then 200 and now, according to some reports, upwards of 400 international-route pilots. Continue reading »
India: industrial production plunges, paanwallahs surge
The streets of India’s cities ran red in March, if data released by the ministry of statistics on Friday is to be believed: production of paan masala, the betel nut-based chewing tobacco famous for the red streams of spit it produces in its users, grew by a whopping 665 per cent.
That’s good news for paanwallahs; if only the rest of the economy – not to mention those who wish to walk on clean streets – were so fortunate. Continue reading »
RBI rupee intervention: quick fix only
In an unexpected move, the Reserve Bank of India on Thursday ordered exporters to sell half of their foreign currency in order to prop up the faltering rupee – which hit an all-time low closing price of Rs53.85 against the dollar on Wednesday. The central bank had done something similar in August 2000.
A good move? Continue reading »
India stays firm on Voda tax bill
The Indian government is standing firm on its call for Vodafone to pay taxes on its 2007 acquisition of Hutchinson’s India business – and it could cost the telecom operator as much as $3.75bn.
RS Gujral, the finance secretary, on Wednesday told news channel NDTV that there was “no question of [the] government negotiating” on its demand that Vodafone pay back $1.46bn taxes on the $10.7bn acquisition, plus a $1.46bn penalty and interest of at least $800m. Continue reading »
Indian markets at four-month low
Both of India’s benchmark stock indices hit near four-month lows in early trading Wednesday as global headwinds, the devaluation of the rupee and policy paralysis in Delhi hit equity markets in Asia’s third-largest economy. Continue reading »
Cipla’s enlightened self-interest
The man who battled big pharma is at it again. Yusuf Hamied was branded a “pirate” by some in the pharmaceuticals industry after he started supplying cut-price generic antiretrovirals for treating HIV. Now he has slashed prices on three major anticancer drugs by up to 75 per cent and says he will do the same with more - possibly extending price cuts to other developing nations. Continue reading »
Air India pilots strike: childish edition
Air India’s pilots have a message for their employer: if you force us to share our toys, then we’re not playing!
That was the attitude expressed by around 100 of the company’s pilots who fly internationally who stayed home late on Monday night in a protest over the national carrier’s plans to train Air India’s domestic pilots on the new Boeing 787 Dreamliner. Continue reading »
India: matrimonial problems for Google
Google may be getting into a new regulatory tangle in India - this time over advertising for matrimonial websites.
Indian media reported on Monday that New Delhi has launched an antitrust probe of the US internet group, looking at the alleged abuse of its dominant market position in online advertising. Continue reading »
Investors welcome India’s latest U-turn
Foreign investors breathed a sigh of relief on Monday as India’s finance minister announced that the government would delay and water down a finance bill provision that could have closed off Mauritius as a tax haven.
But any investor celebration was coloured by the fact that India has once again reversed itself on a major policy, injecting further uncertainty into an environment that has already had its fair share. Continue reading »
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