By 2030, 590 million Indians will live in cities, a number that&rsquo;s twice the population of the United States; between 700 and 900 million square metres of commercial and residential space needs to be built up, that&rsquo;s a new Chicago every year; 7,400 kilometres of metros and subways will need to be constructed, a number that&rsquo;s 20 times the capacity added in the past decade&hellip; the list of jaw-numbing numbers goes on. A path-breaking study by McKinsey Global Institute of how urban India will look in the next two decades is both a source of inspiration and despondency. Investment opportunities are obviously great. According to the McKinsey estimate, an investment of $1.2 trillion is required in terms of capital investment.

From Dharavi to Shanghai

Business Standard

So the bad guy at the Indian Premier League (IPL) is out, an interim chief has taken over in place of the disgraced but still defiant Lalit Modi, an interim management team has been put in place to look after IPL&rsquo;s fourth season, another team has been put in place to examine the records (some of which are said to be missing) and Mr Modi&rsquo;s culpability, and to deal with all queries from investigating agencies, like the income tax department. In all probability, a new management team with a professional CEO will be appointed and, in much the same way that a company is run, this team will report to the IPL governing council. In other words, the Board of Control for Cricket in India (BCCI) is promising the country that Mr Modi was an aberration and, from now on, IPL will be run by the book.

A suitable scapegoat

The Met forecast that this year&rsquo;s monsoon is going to be &ldquo;normal&rdquo; will provide reassurance to many, since the country has just come through a drought year. But the reliability of the Met office&rsquo;s long-range monsoon predictions has been so poor that fingers should continue to be crossed. Bear in mind that met officials failed to predict the droughts of 2002, 2004 and 2009. Last year, the Met&rsquo;s first-stage long-range rainfall projection was 96 per cent of normal rainfall. An updated forecast of 93 per cent precipitation, made after the onset of the monsoon in June, also turned out to be too optimistic. The unprecedented step of revisiting the forecast in August, when the monsoon season was already more than half way through, resulted in an anticipated rainfall figure of 87 per cent. In the event, actual rainfall was just 77 per cent of normal.

Don't believe it yet

The government could end up with Rs 45,000-50,000 crore as revenue from the 3G/BWA (third generation/broadband wireless access) auctions for spectrum; this compares with the Budget estimate of Rs 35,000 crore. Day 14 of the auction for 3G spectrum saw bids reach Rs 33,500 crore, while the BWA auction is scheduled to start two days after the 3G bidding is over.

Winner's curse

India&rsquo;s export-oriented software industry has put behind it the toughest year in its history, with its business model intact. The recovery now under way is likely to be broad-based, stretching across geographies, businesses and verticals, according to Wipro Chairman Azim Premji, who is the industry doyen. This is why the stock market&rsquo;s response to the fourth quarter results has been guided more by the forecasts issued, as in the case of Infosys, than by the performance in the last quarter. The expected recovery is likely to walk on two legs. One is the recovery of the global financial majors who are critical to Indian software for being among its largest customers. The other is the incipient overall recovery in the mature economies which is expected to enable firms to again start spending for greater efficiencies. The anticipation of good times ahead is indicated by projections of higher hiring and announcement of pay hikes.

On recovery road

Opinion is divided on whether the Reserve Bank of India (RBI) did enough on the monetary policy front last week to rein in inflation. Is RBI behind the curve or on the ball? Those who defend RBI believe that its response was along expected lines given the circumstances. These &ldquo;circumstances&rdquo; include the massive government borrowing programme (Rs 2,87,000 crore in the first half of 2010-11 itself). Can the central bank afford to shift focus away from inflation and try to balance it with other objectives like lowering the government&rsquo;s cost of borrowing? This can be gauged by answering another simple, counter-factual question. Would monetary policy rates have been much higher had the government&rsquo;s draft on funds been significantly lower? If the answer is yes, as the RBI&rsquo;s critics would argue, then there is a problem.

Unholy duality

China&rsquo;s confession that it is building a dam on the Brahmaputra, after denying this for long, is only a half-truth. Many believe that it is part of a much bigger plan for diversion of Brahmaputra waters to China&rsquo;s water-starved areas, including the Gobi desert, which is believed to be expanding by 3 km per year. Besides, Beijing&rsquo;s claim that a &ldquo;small project&rdquo; at Zangmu in Tibet on river Brahmaputra (called Tsang Po in China) will not impact water flow to India does not sound credible. Going by media reports, this project itself is only the first of a series of at least four other dams proposed to be built by China on the same river system. China is already known to have given the contract for the implementation of this project to one of its largest engineering and construction companies, and that fact is now in the public domain. That, in fact, may have been the reason for China to admit some activity on the river.

Bend in the Brahmaputra

It is a sad commentary on an organisation that at its silver jubilee it should be reminded that the glass is still half full as far as its stated aims and actual achievements are concerned. That is what Prime Minister Manmohan Singh very correctly told the sixteenth summit of the South Asian Association for Regional Cooperation (Saarc) in Bhutan this week.

Half-empty glass

As a statutory body regulating medical colleges, their affiliation, new colleges, and doctors&rsquo; registration, the Medical Council of India (MCI) is the guardian of ethical practices in the medical profession. It is mandated with maintaining the highest standards of integrity and answerability to consumers and the nation. Its very own code of ethical conduct for the medical profession prevents the realisation of any personal benefit in cash or kind from entities that may benefit from recommendations and practices of the profession. But Ketan Parekh, its own president, stands accused of accepting bribes from a medical college. Personal propriety aside, there are a host of accusations against the MCI of not carrying out its responsibilities in a manner desired. Consequently, quality of many colleges is suspect; protection against poor practices of doctors is more or less absent; and the list of registered practising doctors has errors of omission and commission.

Doctor, heal thyself

If you&rsquo;re looking for instances of just how different this year&rsquo;s Budget is, a good place to look at is the section on subsidies &mdash; for the first time in a decade, subsidies will be lower than in the previous years. At least that is the plan.

Fertilising change

It is strange how the ghost of &ldquo;Agra 2001&rdquo; continues to haunt the Indian policy-making establishment when it comes to India-Pakistan dialogues. Surely the diplomat responsible for media handling at that time, Ms Nirupama Rao, should know by now, as India&rsquo;s foreign secretary, that in hosting a dialogue with Pakistan, the internal official homework is only half the job.

Managing the message

The agricultural growth package mooted in the Union Budget for 2010-11 seems well conceived but not adequately supported by funding for its key elements. This, surprisingly, is despite the 21.6 per cent increase in the overall Central plan outlay for agriculture and allied sectors, the highest hike in recent years. The underlying objective of the four-pronged strategy outlined in the Budget speech for spurring agricultural growth is, obviously, to address the supply side constraints that have sent food prices soaring in recent months. The plan has measures to boost agricultural production; reduce wastages in the food supply chains right from the field to the market and further on to the dining table; lend adequate credit support to the farmers for investing in raising farm output; and to promote the food processing sector to facilitate both waste reduction and value addition of the farm produce.

Reviving agriculture

Given the tight control on expenditure the finance minister has exercised and how niggardly the increases have been on flagship programmes &mdash; Bharat Nirman has risen from Rs 32,473 crore to Rs 35,953 crore and employment guarantee from Rs 39,100 crore to Rs 40,100 crore &mdash; it&rsquo;s natural to wonder whether the deficit reduction targets are for real. Clearly, there is much that can go wrong if global prices go up. The natural targets for this are petroleum prices where the government has not been able to take a decision for several years now &mdash; the Rs 3,108 crore kept aside here will end up being woefully low if crude prices rise above $75-80 a barrel. Ditto for fertiliser subsidies. The other imponderables are food subsidies where the Right to Food Bill, when it is finally passed, could end up bloating subsidies, especially since there are three to four estimates on how many poor people India has and the difference between the top and the bottom is around 2.5 times.

Pranab's padding

Prime Minister Manmohan Singh&rsquo;s long-planned and much-delayed visit to Saudi Arabia has certainly contributed to strengthening of bilateral relations as well as to India&rsquo;s long-term energy security. As India&rsquo;s economic growth rate picks up, and given the uncertainties in the Gulf region, Saudi Arabia&rsquo;s assurances to keep oil supplies flowing and to invest in India&rsquo;s energy security must be welcomed. There has been some criticism in India about Indian diplomatic references to Saudi Arabia&rsquo;s potential role in improving India-Pakistan relations. Whatever our domestic sensitivities, and however discouraging the past record of Saudi Arabia in the region, the fact is that the Saudis have enormous influence in Pakistan and can exert helpful pressure on the Pakistan Army if they so wish. According to strategic policy analysts, Saudi Arabia funds up to 40 per cent of Pakistan&rsquo;s defence budget.

The new great game

After the bad mauling of the 2009 Lok Sabha elections, India&rsquo;s major opposition political parties have been desperately seeking a revival of fortunes. The leader of the opposition National Democratic Alliance (NDA), the Bharatiya Janata Party (BJP), has put in place a new leadership that is eager to make its mark. So desperate is the Left Front, which faces the prospect of defeat in West Bengal and Kerala, that after nearly two decades of isolating the BJP, it has finally rediscovered its old &ldquo;all-in-one unity&rdquo; plank to join hands with all opposition political parties in the protests launched against the Union finance minister&rsquo;s Budget proposal to bring back the earlier higher duties levied on petrol and diesel. The opposition alliance has received a shot in the arm from expressions of solidarity on the part of some of the constituents of the ruling United Progressive Alliance (UPA).

Politics of petrol price

The Union Budget deserves two or maybe two-and-a-half cheers for what it has on offer for the Indian information technology (IT). More than the numbers, it is the change in attitude towards the industry, implicit in the announcements, that is significant. From being a star export performer, important as that is, the industry is being repositioned and mainstreamed as a key enabler of better governance.

Booster dose for IT

The recent one-day strike by the fishermen community in some coastal states and the demonstration staged near the Parliament House in Delhi are a measure of how incensed the community is over the proposed new Central legislation to regulate marine fisheries in the Indian Exclusive Economic Zone (EEZ). The Marine Fisheries (Regulation and Management) Bill, 2009, the draft of which has been circulated to states prior to its introduction in Parliament, is essentially a broad spectrum Bill to ensure sustainability of fishing resources, and with a focus on coastline security, in the light of the Mumbai terror attack.

Fishing trouble

For a nation that prides itself on jugaad, the North Indianism for spunky innovativeness and lateral thinking, it can&rsquo;t be comforting to find it has slipped in the global innovation index. How far India has gone down in the Insead-CII innovation index is difficult to say since this year&rsquo;s rank of 56 out of 130 countries compares with last year&rsquo;s 43rd position out of 107 countries &mdash; China is also down six places, though at 43rd, it is ranked above India. Equally, it can be no one&rsquo;s case the index is flawless. The fact that a report on innovation should give equal weights to political stability as it does to protection of intellectual property or to the number of researchers in R&amp;D per million population is surely problematic.

Takes more than jugaad

One of the very first lessons taught to medical school graduates, before they get down to the Hippocratic Oath, is &ldquo;first, do no harm&rdquo;. In other words, do your best to help but, at any rate, don&rsquo;t worsen things. This, however, is precisely what the government seems determined to do in area after area. If the economic reforms of the past two decades sought to fix the damages caused by well-meaning policies on interest rate subventions and subsidies, the UPA came up with its flagship employment guarantee scheme which, while providing jobs to millions, appears to have been responsible for creating a scarcity of farm labour &mdash; this, anecdotal evidence suggests, may have resulted in increased mechanisation in the farm sector and so created more unemployment than employment created.

First, do no harm

Every year, India&rsquo;s policy makers and corporate HR and marketing chiefs appear to rediscover women on March 8, International Women&rsquo;s Day. For opportunistic MPs, the event is considered a useful reminder to revive the long-standing and -opposed Bill to reserve 33 per cent of the seats in the lower House of Parliament. For India Inc, it&rsquo;s an opportunity to launch products and services that are ostensibly targeted at women. Sundry awards for women employees and entrepreneurs are also par for the course. Both responses may be well-intentioned, but do little to further the cause of Indian women and gender equality.

Women's day out

Now that we have said so many good things about Finance Minister Pranab Mukherjee&rsquo;s Budget, it is time to say some nasty things too. We don&rsquo;t like the idea of the finance minister chairing a Financial Stability and Development Council. Mr Mukherjee&rsquo;s Budget speech said the Council would &ldquo;monitor macro prudential supervision of the economy, including the functioning of large financial conglomerates, and address inter-regulatory coordination issues&rdquo;. He seems to have taken a cue from the Raghuram Rajan Committee report on financial sector reforms that recommended a similar structure. On the face of it, it seems like a sensible idea, given the deep anxieties about financial stability that the global crisis has left in its wake. However, to make this work without diluting the status and authority of the Reserve Bank of India (RBI) could prove difficult in practice.

Mr Mukherjee's bad idea

Incisive columns and editorial comment by top opinion leaders

Page 549 - Editorial Comment