&ldquo;We believe FDI in multi-brand retail is pivotal for the Indian agriculture sector. A direct collaboration between farmers and retailers, efficient supply chain and improved infrastructure will increase farmers&rsquo; realisations, encourage best practices in crop management and improve food safety and hygiene.

Expert speak: Rohit Bhasin

Business Standard

Many sensible recommendations have been made by the high-level safety review committee set up recently in the wake of several accidents on Indian Railways. The report says that if the committee were to make only one recommendation, it would be to monitor and implement what is already known &mdash; but has been languishing at various stages of consideration or execution.

Tracks to safety

The latest report of the Economic Advisory Council, or EAC, to the Prime Minister is a wake-up call, because it presents the macroeconomic quandary more clearly than has been done in the past. While headline attention in the media has focused on the expectation of faster economic growth next year (between 7.5 per cent and eight per cent), that is the relatively unimportant part of the Council&rsquo;s report &mdash; not least because the Council has been consistently behind the curve in anticipating and tracking the slowdown. The meat of the report is in what it says on the trade deficit and the fiscal deficit. For the first time in an official document, the dangers on the external front are spelt out clearly, without pressing panic buttons. The current account deficit, at 3.6 per cent of GDP, is unsustainable and should ideally be capped at two per cent. With oil prices rising, and export markets sluggish, a correction to that extent is unlikely.

Wake-up call

Every entrepreneur needs a cushion of expertise and finance to ensure convertibility of ideas into products. As such, the government's strategy to encourage entrepreneurs must be two pronged. By helping out potential entrepreneurs with regard to finance, it is taking a huge responsibility which needs to be backed by proper expertise. At each stage of conversion, expertise is required to cut down costs, improve, market and ensuring success of the product which would ensure success of the entrepreneur. The government would be well advised to extend professional expertise with a financial safety net.

Student's corner

As World Bank President Robert Zoellick gets ready to step down in June, the inevitable speculation about his successor has begun. And given the state of the US and Europe, much commentary has been expended on the prospect of an emerging economy candidate occupying this powerful post. Inasmuch as these things can be considered accurate, Irish online bookmaker Paddy Power has listed the odds of 24 candidates. Of these, former US Treasury Secretary Larry Summers is the front-runner at 4/11. Current Secretary of State Hillary Clinton at 9/2 and Treasury Secretary Tim Geithner at 9/1 are other prominent runners. The notable point for Indians is the inclusion of Rural Development Minister Jairam Ramesh.

Jairam & Bill: The odds couple

Reading what the panellists had to say at the PwC-Business Standard CEO Summit 2012 (&ldquo;The winter of despondency,&rdquo; February 21), the only conclusion that can be drawn is that India Inc protests too much.

Letters: India Inc must look within

This refers M J Antony&rsquo;s column &ldquo;Firms on the rock&rdquo; (February 22). It is time the Sick Industrial Companies Act (SICA) is repealed forthwith, especially if we consider the case of public sector undertakings (PSUs). The solution is faster disinvestment of PSUs lest they become sick and the ultimate sale becomes a sell-off. The government should only act as a facilitator and should not engage itself in business activities. Air India, BSNL, MTNL and so on are on their way out, they have no buyers and there&rsquo;s no use throwing good money after bad money. A new and modern anti-bankruptcy law is imperative. However, a caveat is in order. Whatever law is enacted, unless judicial reforms are carried out, no fruitful purpose would be achieved. Judicial delays have the tendency to turn every well-intentioned law into a disaster.

Letters: Be done with SICA

Is the India story over? This, apparently, is a common question that foreign investors ask government officials representing India at international conferences. Obviously, that&rsquo;s a tough question to answer since it inevitably raises questions about the government&rsquo;s lack of progress on policy reform. The way one senior official said he played it was to say India is doing well but not the government, explaining away the policy paralysis on the country&rsquo;s democratic set up. The official did, however, wonder how long this explanation would work.

Blame it on democracy

Sweets were recently distributed in the offices of a company that is part of a group that owns one of India&rsquo;s seriously loss-making airlines. The cause: the promoter has just treated himself a new car worth Rs 1 crore and wanted to share the joy with his staff. No doubt the employees of his troubled airline would be even more pleased if their boss had used the money to give them their back pay instead.

Car seva

Some global weather watchers have warned that India will likely see below-normal rainfall during this coming monsoon &mdash; and that should be taken seriously, regardless of whether it turns out to be true or not. This scenario has been repeatedly predicted by the Japan Agency for Marine-Earth Science and Technology and has been endorsed by the International Research Institute for Climate and Society at Columbia University.

Guessing the monsoon

Is the government being duplicitous about its stand on the increasingly distressed Kingfisher Airlines? There have been several statements from various members of the government and State Bank of India (SBI) that no bailout is planned. These reflect sound economic logic. Government bailouts should be restricted to entities that have grown &ldquo;too big to fail&rdquo;, which have made, in the course of their growth, connections so complex and so extensive across sectors that their sudden collapse will gravely affect the real economy. Kingfisher Airlines has a fraction of the civil aviation market &mdash; which itself is restricted to serving the creamiest layer of Indians. By no means, therefore, is it too big to fail. If the market decides it should fail, it should be allowed to. No pressure must be applied on state-owned banks to step in to provide additional guarantees and working capital loans to help the airline hobble on.

Let it fail

This refers to the edit &ldquo;A false choice&rdquo; (February 21). The attack on the Israeli diplomat&rsquo;s car in New Delhi has dragged a reluctant India into the hitherto three-cornered conflict involving Iran, Israel and the US. Now, India must delineate its stand: first, against the use of its territory to play out covert extra-judicial assassinations and retaliations, and second, on reiterating the independence of its foreign policy.

Letters: A new non-alignment policy 

&ldquo;We expect strong measures and economy boosters to restore confidence and spur growth. The implementation of GST will simplify the tax structure and help generate more revenues. Excise duty on branded apparel has led to a huge drop in demand. We would expect an exemption/cut in that.

Industry speak: Govind Shrikhande

&ldquo;Industry is looking forward to the implementation of GST, which can make payment and management of indirect taxes easier. We also expects the removal of service tax on rentals for commercial premises. Besides, any fiscal benefit with impact on consumer&rsquo;s purchasing power will help retail sector.

Chamber speak: Sameer Barde

&ldquo;The sector needs a determined push with implementable regulation. Society and slum rehabilitation projects should be incentivised through profit-linked tax holidays. To enable effective rotation of capital and channelising long-term savings into the sector, REIT regulation should be formalised.

Expert speak: Jai Mavani

&ldquo;The projects where per unit cost is Rs 40 lakh or less should be classified as priority sector. Service tax should be removed on affordable units costing up to Rs 40 lakh.

Industry speak: R K Arora

&ldquo;The sector should be given an industry status. Single-window clearance is also required. The I-T exemption limit on housing loan has been at Rs 1.5 lakh for many years, despite a steep rise in property prices. It should be raised. Tax leakages in small cities/towns should be checked.

Chamber speak: Sandip Somany

I, 25, am an engineer. My monthly income is Rs 20,300. I want to invest.

Financial Planning: Malhar Majumder

What&rsquo;s the secret behind the growing sales of Mahindra &amp; Mahindra&rsquo;s (M&amp;M&rsquo;s) sedan, the Verito? It just could be the last letter of its name, joked Pawan Goenka, president, automotive and farm equipment sectors. Apparently when Vilasrao Deshmukh, then chief minister of Maharashtra, inaugurated M&amp;M&rsquo;s plant at Chakan, he made the point that the brand names of all the company&rsquo;s cars ended with O and suggested that the name of the Logan, the car that was produced in partnership with Renault, be changed to Logano. Certainly, with the Scorpio, Bolero and Xylo all enjoying decent sales and the Logan requiring a re-launch, Deshmukh had made a striking point. Goenka added light-heartedly, &ldquo;Forget about our branding, marketing, the product or the pricing, I should have just listened to the CM and picked a different name for the Logan at the time.

M&M is O positive

The fiscal deficit may be a huge cause of concern for Finance Minister Pranab Mukherjee as the Budget nears but the government&rsquo;s cost-cutting efforts are often hampered by its own rigid rules. A senior bureaucrat but newcomer to government suggested that flowers not be placed in his offices over Saturday and Sunday as a cost-saving measure. The supplier readily agreed but the bureaucrat concerned was advised against it by a colleague who said the department would get an audit query owing to a deviation from this long-standing contract.

Flower power

Rural Development Minister Jairam Ramesh has been promoting sanitation ever since he took charge of the ministry. He has been seeking more funds for it, linking the National Rural Employment Guarantee Act with building toilets. Last week, he vowed to seek the help of none other than cinema maestro Shyam Benegal to trigger a popular shift to toilets. Releasing a United Nations report on Millennium Development Goals, he said Benegal portrayed the white revolution in Gujarat in the movie Manthan and helped the cause of dairy cooperatives. &quot;I want Benegal to do a toilet version of Manthan,&quot; he said pointing out that with just 33 per cent of Indians having access to toilets, lack of sanitation was a reason for poor health indicators. A Manthan-like film, he said, would help break the social barriers that prevent people from using toilets.

Business Standard

Business Standard

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