In the end, Salman Rushdie could not even speak over video-link from London to the crowds that had assembled to hear him at the Jaipur Literature Festival. The festival&rsquo;s organisers, visibly overwrought, said the Rajasthan police &mdash; while supportive &mdash; had warned that angry protestors were marching towards the festival, and in some cases were already inside. Rushdie had already been warned not to come to Jaipur, following threats to his life issued allegedly by militant groups.

Intolerant India

Business Standard

The controversy over wages paid under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) is getting knottier by the day. Social activists, as also the National Advisory Council (NAC) headed by Congress president Sonia Gandhi, have always favoured aligning MGNREGA payments with the prescribed minimum wages in different states. The government has, however, avoided doing so, maintaining that MGNREGA is a social security measure, not a substitute for the existing employment opportunities &mdash; and hence need not follow the minimum wage norms. But the issue has now been confounded with the Karnataka High Court recently ruling that the remuneration under the statutory MGNREGA scheme cannot be lower than the minimum wage.

Two different things

Earlier this week, the Cabinet Committee on Economic Affairs, for the second time, cleared the purchase by the Anil Agarwal-promoted Vedanta Resources of a 58.5 per cent stake in Cairn India from Edinburgh-based Cairn Energy. Though this approval comes a little over a month after the deal was completed between the two UK-headquartered companies, the fact that it took this $8.48 billion deal, the largest involving an Indian company in the oil and gas sector, some 17 months to surmount wholly unanticipated governmental hurdles hardly redounds to the credit of the United Progressive Alliance (UPA).

Random logic

The dramatic management change at smartphone maker RIM (Research in Motion) is an act of desperation. Between July and September of 2011, Gartner estimates RIM&rsquo;s market share via the Blackberry (BB) range slipped to 11 per cent from 15.4 per cent a year earlier. RIM&rsquo;s Playbook has also failed to make an impact in the tablet market. Unsurprisingly, the company&rsquo;s share price has declined by 75 per cent in the last 12 months. It appears consumers are developing a preference for products from Apple and Nokia, as well as those from manufacturers like Samsung which use the open Android platform. RIM&rsquo;s business customers, in particular, have also been spooked by a massive server outage. Developers say that the long-delayed BB10 operating system has a difficult programming interface and new RIM products may lag in offering useful independent applications. BB&rsquo;s &ldquo;killer apps&rdquo; were its encrypted push-mail technology and its messenger service.

Blackberry down

As the days tick down to the January 31 Republican presidential primary in the American state of Florida, the three remaining mainstream candidates would like to think that it is still an open race. The former Massachusetts governor, Mitt Romney, has always been the candidate to beat; but of the three completed primaries so far, he has only won one, in New Hampshire. The Midwestern heartland state of Iowa went to a former senator, Rick Santorum, after a closely-fought election that was, at first, awarded to Mr Romney. And socially conservative South Carolina, in which Mr Romney initially built a commanding lead, gave the former speaker of the US House of Representatives, Newt Gingrich, a 12-point victory. Hammered by these victories, the rest of what was a crowded Republican field dropped out; these three candidates steam into Florida with honours evenly divided. Of course, it is not that simple.

The elephant races 

An examination of the results of 417 companies (excluding those in the financial sector) that have declared their results for the third quarter (Q3) of the current financial year suggests that the slowdown apparent in the second quarter became even more pronounced between October and December 2011. The impact of inflation on raw material inputs, of high interest costs and of rising crude and gas prices is clear. Compared to the corresponding quarter of 2010-11, profit after tax (PAT) has fallen marginally, by 1.7 per cent, for this whole sample. Matters would have been worse except for the weak rupee, which had a positive impact on the sales and bottom-lines of the information technology industry. Across the board, sales growth has been good, with a 25 per cent rise over the corresponding period in 2010-11. However, interest costs have risen 40 per cent and ordinary expenses are up 31 per cent. Profit margins show significant contraction for most industries.

Expenses expanding

The government&rsquo;s decision to geographically split India between two contending registry projects &mdash; the Unique Identification Authority of India (UIDAI) and the National Population Register (NPR) &mdash; is intended to save on the wastage that would result from duplicate data collection. Now they will use each other&rsquo;s data, though duplication cannot be entirely avoided &ndash; as P Chidambaram, the Union home minister, has pointed out. He has, however, backed the new turf-sharing arrangement by arguing that 5-6 per cent duplication &mdash; 60-75 million people &mdash; is not high for a country as big as India. What is sensible is the adoption, conscious or otherwise, of the Chinese practice of allowing different parts of the country to pursue different initiatives. Then, as emerging models or programmes get their act together, in time the Central authorities have no difficulty in adopting for the whole country the ones that deliver better.

Breather for Aadhaar

The 48-odd million employees covered by the Employees Provident Fund Organisation (EPFO) may be touched that the finance ministry is actually considering a proposal to extend the organisation a fiscal helping hand to offer a rate of interest comparable with other savings instruments. That the stretched fisc should subsidise the relatively more affluent subscribers of the scheme is questionable politically.

Improvident fund

The punitive action on January 13 against four scientists of the Indian Space Research Organisation (Isro) in connection with the Antrix-Devas deal leaves many questions unanswered. It does however make it apparent that there have been lacunae in the functioning of one of India&rsquo;s premier scientific institutions, its commercial arm, and the overseeing body. The order from the Department of Space (DoS runs directly under the PMO) states that former Isro head Madhavan Nair, former Isro Scientific Secretary A Bhaskarnarayana, former Antrix Managing Director K R Sridharamurthi and former Isro Satellite Centre Director K N Shankara &ldquo;shall be excluded from re-employment, committee roles or any other important roles under the government&rdquo;.

Space evaders

A significant fall-out of the sharp rise in petroleum prices is the renewed interest globally in looking for alternatives. Fortunately, several options are available for substituting at least some

Bio-fuels are coming

India has one of the world's largest agricultural research networks, churning out a good deal of new technology. But the majority of farmers still practise traditional farming, for want of adequate

Farming without technology

Seeking to dissuade his own supporters from canvassing for another term for him as president of the Indian National Congress, Jawaharlal Nehru famously penned a pseudonymous column in the Modern Review (1937), published from Calcutta, assuming the name Chanakya, drawing attention to his own weaknesses and warning the party against &ldquo;tendencies towards autocracy&rdquo;. &ldquo;He calls himself a democrat and a socialist, and no doubt he does so in all earnestness, but every psychologist knows that the mind is ultimately slave to the heart ... Jawahar has all the makings of a dictator in him &mdash; vast popularity, a strong will, ability, hardness, an intolerance for others and a certain contempt for the weak and inefficient..,&rdquo; the article said, adding, &ldquo;In this revolutionary epoch, Caesarism is always at the door. Is it not possible that Jawahar might fancy himself as a Caesar? ... He must be checked. We want no Caesars.

India's democratic Caesars

In the aftermath of the trans-Atlantic financial crisis of 2008-09, two schools of thought had emerged in India on the likely impact of the Great Recession on the Indian economy. One school drew attention to India&rsquo;s as yet limited exposure to global trade and capital flows and, therefore, suggested that India would be relatively insulated. A second school of thought rubbished such optimism and suggested that the Indian economy too would grind to a halt. Upholders of the first school of thought forecast a growth rate of upwards of 7 per cent for 2008-09, while proponents of the opposite view saw India&rsquo;s growth rate declining to less than 5 per cent, perhaps even 4 per cent in that year. In the event, the Indian economy did slow down but not by as much as feared. More than the slowdown of growth and exports, India saw reduced capital inflows, higher cost of external borrowing, and such like.

Revisiting decoupling

The delay in the National Advisory Council (NAC) finalising its proposals for food security legislation seems to stem from the realisation that legislation is easy, execution is difficult. Once a right to food law is in place, the governments at the Centre and in the states will be expected to deliver, failing which there could be serious political backlash. Identifying the beneficiary is one problem, delivering food to the beneficiary is the second and bigger problem. It is now clear that the unique identity card developed by the Unique Identification Authority of India (UIDAI) would form the basis for choosing the beneficiaries of the right to food law. The main objective of doing so, evidently, is to distinguish between genuine and bogus beneficiaries of both the public distribution system (PDS) and the food security law. The number of fake ration cards in existence today is shockingly large.

Administering food security

Infosys Technologies is a unique Indian success story in many ways, so its internal process of chalking out its future leadership scenario would naturally generate wide interest. The more immediate, if less important a challenge, is finding a new chairman to succeed N R Narayana Murthy who gives up his non-executive leadership of the company next year when he turns 65. The bigger task is outlining the leadership stakes in the medium to longer term, say in the next five to ten years by when the supply of founders will have run out. The two issues are foreigners versus Indians and insiders versus outsiders. Significantly, Infosys is effectively majority foreign-owned, if you add the 35.8 per cent holding of foreign institutional investors (FIIs) to the 18.6 per cent share of equity held in American depository receipts. Also, the FII holding is more than double the founders&rsquo; or promoters&rsquo; holding of 16 per cent.

Leadership at Infosys

While cotton growers are pleased at the increase in cotton prices, boosted by relaxation of export curbs, the textile industry, particularly apparel exporters, seem uneasy. Their main worry is that the sustained 18-month rally in cotton prices and the consequential spurt in the cost of cotton yarn would dent the competitiveness of India-made garments in the global bazaar. Indeed, apparel exports have slumped by 8 per cent in the first five months of this fiscal. But, the silver-lining is that the bad patch for the textile sector seems to have, more or less, ended. The global demand for garments, which had remained subdued since the beginning of the economic recession, has begun showing signs of recovery. Besides, some of India&rsquo;s formidable rivals, notably China and Bangladesh, appear set to lose the competitive edge due to anticipated rise in their production costs.

Spin in cotton exports

Over fifteen months after being re-elected prime minister, Manmohan Singh participated in a conversation with representatives of the print media to reassure the nation that he was not just in charge but also in control of the government. While Dr Singh did address a national press conference after completing the first year of his second term in office, he has been remarkably reticent to engage the media in a conversation. Indeed, he has so far not given a one-on-one interview, to either print or television media at home. Such interviews enable the interlocutor not just to draw the interviewee out, but also cross-examine and understand the thinking behind publicly stated views. But Dr Singh has chosen to remain shy, perhaps for good reasons best known to him. He has developed the skill of a smart politician of making non-controversial and standard statements.

He's minding the store

Prime Minister Manmohan Singh was right when he maintained in his meeting with the media that the judiciary should not stray into the realm of policy formulation for food management. But the same plea cannot apply to the media which brought the issue of rotting of foodgrain to public attention and virtually put the government in the dock for criminal wastage of grains in its warehouses. Policy deficiencies are clearly in evidence for the mess on the food front which has led to amassing more grains than the government can manage. This, predictably, has resulted in rotting of substantial quantities of precious food, which the Supreme Court has objected to. More worrisome is the likelihood of further accumulation of grain surpluses, thanks to an anticipated bumper harvest from the current kharif season. In a few weeks from now, the government will have to again buy and stock foodgrain under its open-ended procurement policy.

Another bumper harvest

Reserve Bank of India (RBI) governor Duvvuri Subbarao has once again spoken the difficult truth. This time on the issue of the pay and compensation given to executives of public sector banks. Coming, as these views do, not just from the governor of the central bank but someone who belongs to the hallowed Indian Administrative Service (IAS) and one who has been Union finance secretary, they must be taken seriously. The governor is right to draw attention to the fact that in a highly competitive market for talent, public sector banks, indeed most public sector firms, are constrained from offering better pay to talented executives because of governmental restraints. The starting point of this problem is the unwritten rule that guides all government and public sector compensation that no chief executive officer of a firm or head of a government-funded institution should get a salary higher than that of his equivalent in the IAS hierarchy.

Paying the banker

The cup of woe of the Commonwealth Games seems to be metaphorically and literally spilling over with unrelenting and heavy monsoon rains. Incomplete event venues, widespread corruption, serial stadium malfunction, leaks, dengue and malaria fears and general mayhem, including theft of imported fittings at the Games Village, have all added to a sense of gloom and doom. An already alienated middle class public opinion now anticipates some sort of Games-related disaster that will shame India globally. Even the ever-popular A R Rahman does not seem to have made a difference. Perhaps for the first time in his career, he is facing criticism for the Games theme song. Mike Hooper, chief executive of the Commonwealth Games Federation, said last week that some Games events may be cancelled for lack of timely safety certificates for various stadiums and the Games Village from the organising committee. &ldquo;Things are surely going down to the wire,&rdquo; he told reporters bluntly.

Postpone the Games!

While the Indian information technology (IT) and related services industry&rsquo;s protest against a decision of the government of the state of Ohio in the United States on banning outsourcing of IT services in government procurement is understandable, India has no official ground to stand on in conveying its displeasure. By choosing to remain outside the existing plurilateral agreements on government procurement, even though India finally decided to become an observer on a World Trade Organisation (WTO) panel on government procurement earlier this year, the government cannot really take the US to the WTO on this issue. In announcing its decision to become an observer on the WTO panel this January, a government spokesperson said that India could be hurt by retaliatory action by the US that could impose a ban on Indian companies benefiting from US government procurement, if India did not open its own government procurement to global tenders under a WTO protocol.

Outsourcing protest

Incisive columns and editorial comment by top opinion leaders

Page 630 - Editorial Comment