Apropos the editorial "RBI runs out of room" (March 20), securing growth must no doubt be an overriding concern. But the other side of the picture needs to be given as much importance. Despite our economy being fairly insulated from the global downturn of 2008, the UPA-II - in a burst of neoliberalism - went in for massive welfare schemes under the guise of economic stimulus. The Reserve Bank of India has been firm on the reduction in policy rates being contingent on containing the fiscal deficit. Despite this, the government has been swayed by Fabian inclusiveness and power patronage. The government is still reluctant to learn lessons in fiscal prudence. The food security Bill could widen the existing fiscal gap. To top this, the government has eyes set on another Rs 1.5 lakh crore under the proposed National Right to Homestead Bill. It seems the government has forgotten that the 2008 global economic calamity was brought on in 2008 by a similar enthusiasm in the US - for large-ticket

Letters: The UPA's misadventures

Business Standard

This refers to Asish K Bhattacharyya's article "Accounting profession: Fallen from grace?" (March 18). The malaise lying with audits can be traced to senior professionals delegating the auditing work to juniors owing to its sheer volume. With no requisite experience, these juniors are clueless about any falsification of accounts. This has also led to most auditors working mechanically, without even cross-checking facts for a possible detection of fraud. Moreover, the auditing team goes by the brand name of companies (read Satyam, WorldCom and Enron) and adopts a complacent approach towards auditing their records. Even boards of directors have not been able to check on managements' tendency to falsify accounts (read Satyam). The presence of independent directors (who are eminent people in their own right) has not improved matters of governance.K V Rao  BangaloreLetters can be mailed, faxed or e-mailed to:The Editor, Business StandardNehru House, 4 Bahadur Shah Zafar MargNew Delhi 110 00

Letters: The trouble with audits

The raid on M K Stalin's house and the subsequent developments could be described as a comedy of errors, revealing the lack of political savvy on the part of the leaders of the government and the Congress. From the prime minister (PM) to the Central Bureau of Investigation (CBI) chief, each averred that he was not aware of the raid in advance. The PM could have stopped with saying he was not informed about it beforehand. It would have given credibility to the oft-repeated statement of the government that although under the charge of a minister of state (MoS) in the PM's office, the CBI functions independently. On the other hand, the condemnation of the action by the PM and another three Cabinet ministers was tantamount to interference in the CBI's working. What is worse, the raid was called off, instead of being taken to its logical conclusion, after Sonia Gandhi was reported to have spoken to MoS V Narayanasami in charge of the CBI. What authority does she have to instruct the ministe

Letters: Illusory independence

Legal consultants at a recent event were gushing over the fact that bribery is helping their profession indirectly. That's because more and more foreign companies were hiring them to deal with bribery and corruption. The trend has accelerated after the recent passage of an anti-bribery law in the UK, a consultant said. This hiring pattern appears to be more in evidence in core industries. "In consumer facing industries, government policy cannot harm you much. But in a resources and manufacturing business, corruption is inevitable," the promoter of a resource company explained.

A booming 'bribery' practice

At a recent seminar, when someone from the audience asked Indigo Managing Director Aditya Ghosh about air fares and competition, he described the aviation industry as an arena where all the players are badly injured and bleeding. "But once in a while, somebody gathers just enough strength to get up," he said and paused. Then he added, "Only to stab the other guy and lie down again."

Gladiators or aviators?

A lighter moment in Google Executive Chairman Eric Schmidt's charm offensive last week was at the National Association of Software and Services Companies (Nasscom) do with Indian start-ups. Everything was fine till Nasscom President Som Mittal announced the entry of Schmidt into the hall, pointing to a door just beside the stage, and the 250 to 300 people in the audience broke into thunderous applause. There was one snag: Schmidt was nowhere to be seen. A wisecrack in the audience suggested: "Google him." Schmidt finally made an entry after a longish five-minute wait, through a smaller backstage door, looking a bit ruffled. "I have never had an entry quite like that," Schmidt was heard muttering on stage.

A Google entry

Due to turbulence in economic climate across the world, VCs have become extra cautious while investing in the Indian e-commerce space

VCs no longer bullish on e-commerce

Production for 63 steel producing countries in 2013. (Click on graphic)

India's steel production down in February

Electric cars may work - but where to charge them?On March 18, Mahindra & Mahindra launched the country's first all-electric four-seat car, which it called the e2o. Those who have test-driven the car say there is a total lack of engine noise - as the car runs on a lithium ion battery - which can at times be unnerving. The turning radius is short, the ride quality is decent, and the pick-up is not bad. But if you want to do corners at high speed, you could lose traction or upset the dynamics of the car. But this is a minor glitch. As a technology, it's environment friendly. And it's inexpensive to run. The cost of driving the car is just 50 paisa per km, which is significantly lower than petrol cars (Rs 4.56 per km), diesel cars (Rs 2.7 per km) and even CNG cars (Rs 2.12 per km). So, an electric vehicle is the way to go.The problem is the price. At Rs 5.96 lakh (on-road price in New Delhi), the e2o isn't really cheap. For this price, buyers have the option to pick from a whole range

A new spark

While the Bharatiya Janata Party (BJP) chief Rajnath Singh is struggling to nominate the party office-bearers - vice-presidents, general secretaries and secretaries - given the constant push and pull by the party senior leaders who want their candidates to find place, other allies of the National Democratic Alliance (NDA) do not face similar troubles. When one of the senior leaders of the party was asked about the delay in announcing the names of the BJP's office-bearers, he said, "I was discussing the issue with NDA convenor Sharad Yadav. He told me that there were 81 general secretaries of the Janata Dal (United) in Bihar alone. He also said people with political ambitions should be made general secretaries, so that they get a post, and they don't work against the party... But we cannot say this about the BJP because we struggle to fill just a handful of posts." Interestingly, Lalu Prasad's Rashtriya Janata Dal has 105 general secretaries in Bihar alone.

Sheer numbers

With the return of the two Italian marines to New Delhi, who submitted to the apex court jurisdiction,  the Bharatiya Janata Party was suddenly seen claiming the credit for it. It said its "pressure tactics" had yielded the results. To this, a bemused External Affairs Minister Salman Khurshid said, "I find it a little difficult to conceive that the Opposition had any part to play in the marines returning, but if it wants credit... fine."

For the want of credit

Govt cannot assume it will solve current account problem

When gold falls

Export fall-off requires more than just sops

Trade travails

Cabinet Minister for Chemicals and Fertilisers M K Alagiri is known to follow instructions only from Dravida Munnetra Kazhagam (DMK) chief M Karunanidhi. But this time he had to follow, however reluctantly, the script written by Karunanidhi's son and rising star M K Stalin, and resign from his ministry after his party pulled out of the United Progressive Alliance government. Ministry sources say Alagiri was distinctly unwilling to relinquish his post and had even asked to sign the Drugs Price Control Order, which has been pending for many months. He was not only the last DMK minister to submit his resignation, he also refused to accompany T R Baalu and others to meet the prime minister.

No-go on resignation

The letter "o" continues to play a superstitious role in Mahindra & Mahindra (M&M's) car launches, as the name of its first electric car after the acquisition of Reva showed. All the names of M&M's best-sellers, starting with the Scorpio, end with the letter "o" and that partly dictated the change of name for this model from NXR to e2o. "We wanted something short and simple. e2o stands for energy to oxygen. Besides, every vehicle at Mahindra has to end with an 'o'," explained Mahindra Group Chairman Anand Mahindra. And that's sacrosanct, it seems. "You are not allowed to say 'e-twenty' or 'e-two-zero' but only 'e-two-oooo'," Mahindra added, dragging out the sound the last letter to emphasise his point.

O positive for M&M

The finance ministry and the Reserve Bank of India have long had a tussle over independence of decision-making for the latter, so the former may have been delighted with a public relations (PR) executive's inability to distinguish between the Budget and the monetary policy review. On the eve of the mid-quarter review of the monetary policy on March 19, a PR executive called a reporter and enquired - not once but twice -  about planned Budget stories. He had to be reminded that the Budget was over three weeks ago.

Budgeting for credit policy

This refers to the report "Customers in smaller cities to have better access to insurance, courtesy Budget proposals" (March 12). As an old insurance hand, I believe it is a laudable step. Right from its nationalisation in 1956, life insurance has been envisaged as a mode for canalising savings of people, especially in the context of the then ensuing Second Five-Year Plan. As against some 97 centres in which private insurers were operating then, LIC started 300 new branches. As agents played the most important role, in 1969, all branches were required to maintain a record of areas with a population of more than 1,000, under their jurisdiction, that did not have an agent. And during the mandatory annual inspection, officers were required to report on obtaining agents in those areas concerned. At the time, insurance officers claimed that barring villages in the Himalayan region and some parts of Rajasthan, every village with a population of more than 1,000 had at least one LIC agent. Rec

Letters: Old-style LIC agents

Apropos the report "Cabinet clears revised food Bill" (March 20), the United Progressive Alliance (UPA's) decision to introduce the Bill at this juncture is a populist move to garner votes; it lacks financial and practical prudence. The finance minister contained the country's fiscal deficit for 2012-13 by cutting development allocations. An additional burden on food security will only add to the deficit. Despite ample stock of food grain, the food inflation goes unabated owing to the lack of a proper supply chain and storage facilities. It is not clear whether the UPA really wants to address these challenges head-on.N Ramamurthy  ChennaiLetters can be mailed, faxed or e-mailed to:The Editor, Business StandardNehru House, 4 Bahadur Shah Zafar MargNew Delhi 110 002Fax: (011) 23720201E-mail: letters@bsmail.inAll letters must have a postal address and telephone number

Letters: Facing food lapses head-on

Apropos the editorial "Breaking foreign policy" (March 21), the current foreign policy imbroglio relating to the Sri Lankan issue has thrown up a serious question: Should our foreign policy be dictated by the narrower interests of a single state? The voices being raised in favour of the affirmative answer seem to be getting stronger. While it sounds prima facie fair, there is a deeper and disturbing question - have the states lost faith in the Centre? Have they come to believe that the Centre cannot take adequate care of their interests? This is of a piece with the view that we need representatives of a particular section of populace, say women or other backward classes, at the Centre to take care of their interest. It is a disturbing portent to paucity of statesmen-like leaders at the Centre with the capacity to carry diverse sections of Indian populace along.Kishor Kulkarni  MumbaiLetters can be mailed, faxed or e-mailed to:The Editor, Business StandardNehru House, 4 Bahadur Shah Zaf

Letters: Centre-states trust deficit

Minimum public shareholding norms of 25% for private sector companies and 10% for PSUs were prescribed three years ago. A deadline of June 2013 was fixed for the former and August 2013 for the latter. If these deadlines were complied, the markets should have an avalanche of issues over the next few months. But given the market conditions, it is unlikely that all these would be successful.

An avalanche or a mirage?

Domestic manufacturing will reduce India's dependence on imports of electronics but may deprive access to the latest global products

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