Green is the colour of our times. In the run up to the Copenhagen Climate Summit, everyone is doing whatever is possible to establish one&rsquo;s green credentials. Nowhere is such symbolic activity more in evidence than China. Despite its terrible track record on the environmental front, China has worked hard to earn brownie points from the media, non-governmental activists and other governments with a slew of initiatives. One such initiative was the idea of &ldquo;Green GDP&rdquo; launched by Prime Minister Wen Jiabao in 2004, with the first report published in 2006. No sooner was the report published than the initiative got shelved because the bad news was damming. It showed that the financial loss caused by pollution alone was 511.8 billion yuan ($66.3 billion). This was estimated to be 3.0 per cent of China&rsquo;s GDP. However, other estimates placed the environment&rsquo;s negative impact to be as high as 8-12 percentage points of GDP growth.

Greening statistics

Business Standard

If there is one factor that unites most cities in India these days, it is the spectacle of road construction. Work on flyovers, fresh carpeting or widening of existing roads and construction of new ones are a common sight, holding out the promise of better connectivity for motorised vehicles across cities. In the last few weeks, New Delhi has seen almost all its roads dug up, either to be built afresh or to facilitate the installation of new lamp-posts. The sudden surge in road construction activity in New Delhi is largely attributable to the Commonwealth Games to be held in the city next year. However, the reason for the pick-up in road construction in other cities is the rising demand for better and wider roads from more people using their own vehicles to commute from one place to the other. This is the other side of India's automobiles boom.

Paving the way

It has not been clear in recent weeks as to where exactly the government stood on the climate change negotiations, with different spokesmen pushing different lines of argument. The prime minister has now put all speculation to rest with his statement at the Commonwealth summit, asserting that India wants the Kyoto framework (which places differential responsibilities on rich and poor countries) to be made to work, and linking India&rsquo;s domestic emissions control plan to the promised transfer of technology and resources from the rich countries. He has also opposed the western move to downgrade the agenda for the forthcoming Copenhagen summit, and made it clear that India has a vital stake in serious emission cuts being achieved internationally. Meanwhile, in Beijing, four leading developing countries have announced that they will act together at Copenhagen, thus making it clear that the rich countries will not be allowed to steamroller the rest.

Carbon lines in the sand

Murphy&rsquo;s law is at work in the global financial and realty markets. If something can go wrong, it will. No one who is familiar with the facts of Dubai&rsquo;s boom and its global dimension ought to have been surprised by the debt crisis that has hit Dubai World. For the last one year, there have been far too many stories coming out of the region on real and potential bankruptcies, plans being shelved, excess capacity and inadequate demand. The global financial crisis and the rollback in oil prices in 2008 were largely responsible for this. However, for the same reason, the moderation of the global slowdown and the recent rise in oil prices have helped improve sentiment in the region. Lack of transparency, poor management of a financial problem and the long weekend seem to have done more to spook the markets than the real size of the problem itself.

The Gulf in Dubai

Two years ago, almost to the day, the Sensex first crossed the 17,000 mark, having climbed from 16,000 in just five heady trading days. That was in the bubbly days that prevailed in 2007, when the eventual scale of the financial crisis was in the realm of the impossible. The stock market index went on to scale 21,000 before hitting 17,000 again in May 2008, but this time on the way down to a low point of 8,200 that was touched as recently as March this year.

On the rebound

The generally accepted view is that the government runs a bloated bureaucracy. Its current employee strength is 3.32 million. But over 80 per cent of this number is accounted for by specific service departments: posts, central police forces and the railways. Logically, these should not be counted as part of a &ldquo;bureaucracy&rdquo;, which as a consequence stands reduced to a relatively modest 600,000. Since the overwhelming majority of even that consists of clerical and support staff, the operational part of the government is quite simply too small. In almost any direction one looks, there is a shortage of the required people. India has too few judges, one of the smallest foreign offices in the world, overworked officials dealing with trade negotiations in the commerce department, and desperate under-staffing at regulatory bodies in charge of areas like pollution control and drug safety.

Fat in the wrong place

Charat Ram, the industrialist, used to say that all labour disputes are the fault of company managements. That would certainly seem to be the case with Air India (as indeed it was earlier with Jet Airways&mdash;not once but twice). The national airline&rsquo;s new chief executive came into a crisis situation that cried out for change and for costs to be cut&mdash;never an easy or pleasant task. There was some tough talking done initially, followed by some tough measures. But along the way, what seemed to have been forgotten was that consensual functioning had much to be said in its favour. The result was a pilots&rsquo; strike that threatened to cripple the airline. At one stage, the management seemed to be readying for a lock-out&mdash;which would have handed a lollipop to Air India&rsquo;s private sector rivals. Fortunately, wiser counsel prevailed, primarily (it would seem) because the Prime Minister intervened.

Don&#39;t play hardball

In the past, state-owned Doordarshan used to co-opt broadcasts of cricket tournaments expensively acquired by private channels by claiming that such events were of &ldquo;national importance&rdquo;. That argument, commercially questionable as it was, will cease to hold if the recent TV ratings for the ICC Champions Trophy are anything to go by. This is not a new trend. Five years ago, an India-Pakistan one-day international (ODI) match used to get ratings of 12-plus.

Time for a game change

The trade numbers for August 2009, released by the ministry of commerce and industry last week, indicate that the declining trend is far from over, although the negative momentum may be slowing a bit. Exports in August showed a year-on-year drop of 19.4 per cent in dollar terms, somewhat better than the 30 per cent decrease seen during the April-August period, but still reflecting a sluggish global market as also lower commodity prices compared to a year earlier (when they were at their peak). This pattern will persist until September, after which a significant base effect will kick in and the year-on-year growth rates will climb to near-zero levels. It is only in 2010, when the US and Europe are expected to return to positive GDP growth rates, that the export numbers will turn respectable. Even then, it will take some time for volumes to return to the very buoyant levels that were seen during the first half of 2008-09, before the decline began last October.

A changing picture

Pakistan&rsquo;s decision to approach the World Bank for appointing a neutral adjudicator for the controversial Kishenganga hydropower project on the Jhelum appears to be a tactical move designed to further delay a scheme that can spur economic development in the region. The project, started in 1994 on the Kishenganga, a tributary of the Jhelum known as Neelum in Pakistan, envisages the production of 330 Mw of hydroelectricity for power-starved Jammu and Kashmir. It has been dragged into needless controversy right from the beginning by Pakistan, which subsequently decided to put up its own 990-Mw hydropower plant on the same river. Pakistan&rsquo;s move on the Kishenganga is, in a way, a repeat of its similar but unsuccessful bid to stall the 900-Mw Baglihar power project on the Chenab in Jammu and Kashmir.

Stalling Kishenganga

Paul Polman will never forget his first visit to India&mdash;he got away with his life last November in the terrorist attack on the Taj Mahal Hotel in Mumbai. Gunmen had stormed the place when he was at a farewell dinner for his predecessor Patrick Cescau. In his second visit to the country soon after taking charge, Mr Polman said such incidents make one stronger to face life&rsquo;s difficult moments. The first &ldquo;outsider&rdquo; CEO of the Anglo-Dutch FMCG (fast-moving consumer goods) giant is putting that strong will to good use at a time when the gods are not smiling much upon Unilever, including its Indian subsidiary Hindustan Unilever (HUL). India&rsquo;s largest FMCG giant has been losing market share steadily (during April-May 2009, it lost value market share across product categories by up to 6 per cent). So, there is a new corporate jargon for Unilever across markets&mdash;Mr Polman has formulated a 30-day plan for each product innovation or attempt at troubleshooting.

The 30-day manager

At a time when the flow of institutional credit has tended to look up, pointing to economic recovery, the disbursal of agricultural credit has dipped by an astonishing 30 per cent, putting the prospects of recovery in the drought-ravaged farm sector in jeopardy. The numbers released by the National Bank for Agriculture and Rural Development (Nabard) indicate that both commercial banks and cooperative credit outlets are lagging behind their targets by margins so wide as to be difficult to bridge in even the next (rabi) season. Total credit to the agricultural sector till August 31 was reckoned at Rs 1,10,000 crore, which is just 34 per cent of the target of Rs 3,25,000 crore set for 2009-10. This is worrisome because the kharif season normally accounts for 60 per of total agricultural loans. Going by this norm, disbursals should have been nearly twice what they have been so far this year.

Shrinking credit to farmers

Corporate Affairs Minister Salman Khurshid may be surprised to know that the CEOs of many Indian companies may be underpaid&mdash;not by global standards (a meaningless comparison) but by the government&rsquo;s own guidelines. Asking for CEO restraint when it comes to pay and perquisites, therefore, is to shoot in the wrong direction. Mr Khurshid&rsquo;s statement last week, two years after the Prime Minister made a similar appeal, erroneously suggests that corporate compensation in India is an unfettered gravy train. At senior levels, executive compensation is subject to government guidelines that are de facto restrictions linked to net profits (none of it taxpayers&rsquo; money).

Fat cats and aam aadmi

It takes courage to defend migration these days. At a time when the movement of people, within nations and between nations, is coming up against political and social barriers, the United Nations Development Programme has boldly set out a package of reforms in its Human Development Report (HDR), 2009, to make the life of migrants easier.

The case for migration

Nine months have passed since the country&rsquo;s largest financial scandal hit Satyam Computers, after its promoter Ramalinga Raju confessed to a fraud that its auditors had failed to detect. The government acted swiftly. In about 100 days, a new, government-appointed board facilitated Satyam&rsquo;s acquisition by the Mumbai-headquartered Tech Mahindra through a bidding process, and thus saved Satyam from collapse. Such speed of action was missing elsewhere.

Accounting for Satyam

Nearly eight decades after the pound went off the Gold Standard, has the time come for Britain to consider whether it needs the pound at all? Britain&rsquo;s euro-sceptics have congratulated themselves ever since they rejected then Prime Minister Tony Blair&rsquo;s abortive attempt to get the pound replaced by the euro, a move that the then chancellor of the exchequer and present Prime Minister, Gordon Brown, had opposed.

The pound without a G-string

India&rsquo;s education system organises disciplines into separate, rigidly isolated silos: physics, chemistry, biology, medicine, etc. It is unthinkable for a physics student in, say, Baroda University to delve into the structures of biological material. That is obviously the domain of biologists. However, cutting-edge research often needs to draw upon several disciplines and the formal distinctions are blurred in the best labs, as they are in real life. The necessity for cross-disciplinary work is exemplified in this year&rsquo;s Nobel awards. Venkatraman Ramakrishnan, a physics graduate from Baroda, is part of a trio that now shares the Nobel Prize in chemistry. The same work could well have been awarded the medicine Nobel instead. The medicine award, as it happens, went to investigations of the properties of telomerase, the enzyme which allows cells to reproduce without ageing. That research could easily have won the chemistry prize.

Cutting across edges

Compared with the media focus on the G-20 summit that took place a couple of weeks ago, the semi-annual meetings of the International Monetary Fund (IMF) and the World Bank (WB), which were held in Istanbul this week, seem to have attracted little attention. This may be surprising, given that the multilateral institutional framework, of which these two organisations are such a significant part, has been seen by the G-20 as being an integral part of the solution to the global economic crisis and the means by which future crises can be prevented. The speeches of both Robert Zoellick, president of the Bank, and Dominique Strauss-Kahn, managing director of the Fund, certainly emphasised the re-orientation of the role that both institutions would play in the future and the organisational changes that were needed.

Not Bretton Woods II

China will celebrate the 60th anniversary of its Communist regime today. The government is putting on a huge show, but the significance of the display of power and grandeur has more to do with the country&rsquo;s future than its past, which has been patchy and violence-ridden even as the country has taken phenomenal strides to its present position.

Inflection @ 60

Now that the IIT teachers&rsquo; agitation has been put on hold, attention should turn to what needs doing to put this important educational brand on a long-term path of good health and growth. These institutes&rsquo; traditional weakness, when it comes to research, has been underlined, in the meantime, by the awarding of a Nobel to an Indian-born scientist working in Cambridge. The question arises, is it enough to produce good engineers, or should elite educational centres seek to achieve more by expanding the frontiers of human knowledge? There might be some conflict between the goals of teaching and research (faculty time is finite, after all), but the best institutions manage to do both very well.

Teaching is not enough

With the Group of Ministers (GoM) readying to allocate the unallocated portion of Reliance Industries Limited&rsquo;s Krishna Godavari Basin gas, the question asks itself: is the country going back to the days of the Administered Price Mechanism, when everything was decided by the government? Many will assume that there is no option since one company (Reliance Industries) accounts for 70 per cent of the country&rsquo;s gas production and this dominance gives the company market power that it can

Freeing gas prices

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