DAP &mdash; the three-letter magic word which rules the life of most farmers. Some say it is not magic, but black magic, like a drug with a tantalising hold that just won&rsquo;t let you go. DAP is short for Diammonium Phosphate (a commonly used fertiliser). Whether illiterate or not, farmers all over India know about DAP. And, currently, the biggest crisis that they are facing is the 100 per cent increase in the price of DAP and its acute shortage. They are willing to go hungry if only they could buy some DAP fertiliser.

Sreelatha Menon: DAP and the holy cow

Business Standard

The Reserve Bank of India (RBI) has at last rung down the curtain on administered lending rates by freeing the interest rate on savings bank accounts. The interest rate was pegged at four per cent in May after remaining unchanged for eight years. Banks will now be free to pay whatever they like as long as they offer a uniform interest rate on savings bank deposits of up to Rs 1 lakh, beyond which differential rates can be offered depending on the size of deposits. Being able to get away with paying less was a crutch that was offered to the state-owned banks in order to give them time to get ready to face competition implicit in a level playing field. Twenty years, since the reforms began, is a long time in which to grow up. The move will be an invaluable gain for ordinary depositors, who have been getting the short end of the stick by earning a pittance for their money at a time when inflation has been running close to 10 per cent.

Saved by RBI

An earlier article in this column had discussed the Point of Taxation Rules 2011 (POTR), which have come into force from the 1st July this year. As is well known, the POTR has essentially shifted the basis of payment of service tax from receipt of consideration i.e. cash basis to any of receipt of consideration, date of raising of invoice and completion of milestones i.e. on the basis of accruals. This article deals with some residual challenges that POTR pose in discharging the liability to the tax, notwithstanding that the shifting of the basis for payment of tax as above is in line with global best practice and is a necessary precursor to the GST.

Point of taxation of services

Section 74 of the Customs Act, 1962, warrant verifying of parameters such as physical properties, weight, marks and numbers, test reports, documentary evidence, etc, for identification of the goods and determination of &lsquo;use after import&rsquo;. Dated October 20, the circular says for grant of drawback on re-export of imported goods under Section 74, detailed speaking orders, following the principles of natural justice, are to be issued on whether a drawback is proposed to be sanctioned fully or partly or proposed to be denied.

Mere verbiage, not action, on duty drawback

The first-cut data on national income growth in the first quarter, showing a deceleration in the growth rate of gross domestic product to sub-eight per cent level, are along expected lines. India&rsquo;s macroeconomic authorities have been warning that in fiscal 2011-12 the economy is likely to grow between 7.5 and 8.5 per cent. A variety of explanations can be offered for the slowdown, ranging from questions about the quality of data and changes in data computation methodology to global economic and domestic political factors. While the big picture is along expected lines, the sharp deceleration in the construction sector remains unexplained. To the extent that this is a response to monetary policy, not only is the deceleration to be expected, but it must also be condoned. After all, it was a stated objective of monetary policy that the observed increase in bank lending to the real estate sector should be squeezed a bit. However, this is unlikely to be the complete explanation.

Growth and policy

Anyone who thinks there is no economic price to pay for prolonged political instability has to only look at Japan. The sixth prime minister in five years has just taken charge. Prime Minister Yoshihiko Noda, the latest occupant of the hot seat, will have to contend with a fractious political system, both within and outside his party, which makes his task of reviving a moribund Japanese economy even harder. Mr Noda is described as a &ldquo;reformer&rdquo; who favours tax increases to pay for sharply increasing social security costs as Japan&rsquo;s population ages and also to curb its staggering public debt. His contention that Japan&rsquo;s population will have to share the financial burden of reconstruction following the tsunami-earthquake combination in March is also unlikely to draw serious opposition. Mr Noda is also a political revivalist of sorts. His comments exonerating convicted Japanese World War II criminals have expectedly drawn loud protests from China.

Raising a fallen giant

India&rsquo;s heady economic prospects of a year ago have deteriorated unthinkably. True, the rest of the world is wobbly, too, from America&rsquo;s unreconstructed and unsustainable headlong decline, to much of Europe&rsquo;s companion piece. But the possibility of some buffering for India seems to have evaporated.

Shyam Ponappa: Reviving growth

Can countries protect the environment while advocating and practising policies that liberalise trade in goods and services? The Doha Work Programme of the World Trade Organisation (WTO) calls for &ldquo;enhancing the mutual supportiveness of trade and environment&rdquo; and broadly called for negotiations on three issues: (i) the relationship between existing WTO rules and specific trade obligations set out in multilateral environmental agreements (MEAs); (ii) drawing out procedures for regular information exchange between MEA secretariats and the relevant WTO committees and; (iii) working on the reduction or, as appropriate, elimination of tariff and non-tariff barriers to environmental goods and services.

T S Vishwanath: Tricks of trade

The latest series of consumer price indices (CPIs) released by the Central Statistics Office (CSO) keep 2010 as the base year and are available for all states for rural and urban areas separately.

Indicus Analytics: No relief for Bharat

The charge of government interference in the functioning of the Securities and Exchange Board of India made by its former member K M Abraham is serious and he deserves a fairer hearing from the powers that be in New Delhi than has been the case so far. To paint him as a disgruntled and corrupt element, because he was denied an extension of term and had invested in an apartment in Mumbai built by someone who had business dealings with the National Stock Exchange, as the Union finance ministry has done, is both unfair and unconvincing. It is shocking that when Mr Abraham approached the then Union Cabinet secretary and the principal secretary to the prime minister for help, the correct thing to do by a member of the Indian Administrative Service, he was asked to beseech the very person against whom he was complaining, namely Omita Paul, advisor to Union Finance Minister Pranab Mukherjee.

Time to come clean

Despite the clear delineation of the line of command between India&rsquo;s civil and military leadership, a clash of egos between chiefs of staff (CoS) and senior civil servants has been a recurrent problem for India&rsquo;s political leadership since the days of Prime Minister Jawaharlal Nehru. Many an army general has clashed with a defence secretary and vice versa. Sometimes the armed forces leadership has directly clashed with the political leadership. Such differences of opinion are understandable and should normally be handled through established codes of civil-military conduct. It is, however, regrettable that a purely administrative and institutional matter pertaining to the procedure for ascertaining the date of birth, and hence the longevity of tenure, of Army Chief General V K Singh, is being sought to be politicised by General Singh.

General and generalists

So the Central Bureau of Investigation or CBI has said that it does not have any evidence of a money trail between Sanjay Chandra of Unitech and former telecom minister A Raja to suggest a quid pro quo. Mr Chandra and Mr Raja are in jail over the so-called 2G spectrum scam.

Bhupesh Bhandari: Public loss, private gain?

How do cities (actually, the people who live in those cities) view art? At the risk of trading in clich&eacute;s, one finds that over the years the dynamics haven&rsquo;t changed all that much, even though the markets have shifted base from the financial capital to India&rsquo;s aspiring world city where reckless spenders on brands treat art as just another commodity that&rsquo;s as important, or insignificant, as the signature on it.

Urban at art

It&rsquo;s California&rsquo;s reading-for-pleasure and its attendant neighborhood library culture that I miss the most. Yes, that&rsquo;s it. I&rsquo;m finally sure of the answer to the second question every one in Palo Alto asked us when we said we were moving back to India. It was after our container had been shipped, carrying all our worldly belongings. All we had left to get us through the next few weeks were eight suitcases, a borrowed airbed &mdash; and around 50 books from our neighborhood library.

Aditi Phadnis: Making the twain meet

Now that the crowds have gone home, Anna Hazare is back in Ralegan Siddhi, and the TV Rottweilers are looking for other ways to boost their rating points, we can have a rational debate about not just the Lok Pal but the larger issue of corruption. The starting point has to be that no one person or set of agitators has a monopoly over the wisdom on the subject, and that no single solution exists. Also, some purported solutions may disappoint.

T N Ninan: Get religion

It&rsquo;s been a tumultuous month for technology. Apple lost Steve Jobs as CEO, Hewlett Packard (HP) gave up the tablet war even before it got going, Financial Times pulled the plug on Apple by refusing to share data and revenues and Sony introduced the world&rsquo;s first foldable tablet. The world of technology has clicked into an irreversible trajectory, as has the interface between man and device. Web consumption is firmly in mobile telephony territory &mdash; cheap, cheerful, transformational, and in the process of creating new king makers.

Tablet wars

The ongoing turmoil in the Middle East is actually a battle for influence that is gathering momentum in the region between Saudi Arabia and Iran, and all powers will have to deal with it soon.

Harsh V Pant: A new balance of power in the Middle East

Following on some seminal steps taken by Bangladesh Prime Minister Sheikh Hasina during her state visit to India in January 2010 to rid bilateral relations of the logjam, she has taken the first big step towards addressing India's most serious security concern by handing over a wanted insurgent &mdash; Ulfa activist Arabinda Rajkhawa &mdash; and avowing that she would not let Bangladeshi territory be used by elements hostile to India. This is the critical moment for India to take an even bigger step, and convert a d&eacute;tente into an entente cordiale.

Raghu Dayal: It's time for an India-Bangladesh entente

Depending on conventional theory to predict markets.

The more things change...

Devi Prasad Tripathi, chief spokesman of the Nationalist Congress Party (NCP) spoke to Kavita Chowdhury on the Congress&rsquo; relationship with its alliance partners and the Lok Pal Bill.

Q&A: Devi Prasad Tripathi, chief spokesman, NCP

Business Standard brings you expert opinions on various issues

Page 730 - Opinion Specials