Amid reports that he had already sent his resignation to the Prime Minister, Railway Minister Dinesh Trivedi attended Parliament, saying it was his "duty".

A day after Trinamool chief and West Bengal Chief Minister Mamata Banerjee demanded his sacking, Railway Minister Dinesh Trivedi attended Parliament saying it was his “duty to get my Railway Budget passed in Parliament”.

“I am going to Parliament as a Minister. I have come for Question Hour. I have to answer my questions. I am doing my duty, let me do that please” he told reporters before entering Lok Sabha.

“But if my leader Mamata Banerjee or the Prime Minister asks me to resign, I will do so,” he told journalists in a brief interaction without taking further questions.

'Trivedi has not resigned'

In the Lok Sabha, Finance Minister Pranab Mukherjee said the Mr. Trivedi has not resigned, but that a communication from Trinamool Congress chairperson Mamata Banerjee was under “active consideration” of Prime Minister Manmohan Singh.

Amid turmoil over the Trivedi issue, Mr. Mukherjee told the House that the communication from Ms. Banerjee was received late last night and “as and when a decision will be taken, the House will be informed.”

Mr. Mukherjee did not divulge details of the communication and his remarks came after opposition uproar over the issue of reported resignation of Trivedi as Railway Minister.

BJP and Left leaders described the situation as “unusual and unprecedented” and sought clarifications from the Prime Minister as it showed his coalition government in “poor light” and as “weak“.

Leader of the Opposition Sushma Swaraj, Sharad Yadav (JD—U), Basudeb Acharia (CPI—M) and Gurudas Dasgupta (CPI) had given notices for suspension of Question Hour and sought clarification from the government.

Speaker Meira Kumar disallowed their notices but allowed them to have their say.

Mr. Trivedi was sitting in the front row in the Lok Sabha which is usually occupied by senior ministers and questions were listed against his name for reply during Question Hour.

However, the House was adjourned before the questions could be taken up.

Ms. Swaraj also wanted clarification on the Railway Budget, to which Mukherjee said the government owned up the proposals that were approved by him as Finance Minister.

Govt. to consider replacing Trivedi

Prime Minister Manmohan Singh on Thursday said the government will "consider" replacing Dinesh Trivedi if such a situation develops.

“Well, if anything like this develops, we will consider it,” Singh told reporters in Parliament House.

Following are the highlights of Economic Survey 2011-12, as detailed in the website of the Press Information Bureau:

Click here for infographics based on the Economic Survey 2011-12

1. Rate of growth estimated to be 6.9%. Outlook for growth and stability is promising with real GDP growth expected to pick up to 7.6% in 2012-13 and 8.6% in 2013-14.

2. Agriculture and Services sectors continue to perform well. 2.5 % growth in Agro sector forecast. Services sector grows by 9.4 %, its share in GDP goes up to 59%.

3. Industrial growth pegged at 4-5 percent, expected to improve as economic recovery resumes.

4. Inflation on WPI was high but showed clear slow down by the year-end; this is likely to spur investment activities leading to positive impact on growth.

5. WPI food inflation dropped from 20.2% in February 2010 to 1.6% in January 2012; calibrated steps initiated to rein-in inflation on top priority.

6. India remains among the fastest growing economies of the world. Country’s sovereign credit rating rose by a substantial 2.98 percent in 2007-12.

7. Fiscal consolidation on track - savings & capital formation expected to rise.

8. Exports grew @ 40.5% in the first half of this fiscal and imports grew by 30.4%. Foreign trade performance to remain a key driver of growth. Forex reserves enhanced - covering nearly the entire external debt stock.

9. Central spending on social services goes up to 18.5% this fiscal from 13.4% in 2006-07.

10. MNREGA coverage increases to 5.49 crore households in 2010-11.

11. Sustainable development and climate change concerns on high priority.

Keywords: Ecnomic Survey 2011-12, Economic Survey, Industrial growth, economy, agricultural growth

Akhilesh Yadav, son of Samajwadi Party chief Mulayam Singh Yadav, was on Thursday sworn in as the Chief Minister of Uttar Pradesh, the youngest-ever to hold the office.

Mr. Yadav at 38 will be the 33rd Chief Minister of the most populous State. He was administered the oath of office by Governor B.L. Joshi.

He took oath in the presence of his father, family members, leaders of various political parties and prominent personalities.

Nineteen ministers of Cabinet rank were also administered the oath, besides 29 ministers of state.

The Cabinet ministers are Azam Khan, Shivpal Singh Yadav, Ahmad Hasan, Waqar Ahmad Shah, Raja Mahendra Aridaman Singh, Ambika Chaudhary, Anand Singh, Raghuraj Pratap Singh alias Raja Bhaiyya, Balram Yadav, Om Prakash Singh, Awadhsh Prasad, Parasnath Yadav, Ram Govind Chaudhary, Durga Prasad Yadav, Brahma Shanker Tripathi, Kameshwar Upadhyaya, Raja Ram Pandey, Raj Kishore Singh and Shiv Kumar Beria.

Keywords: Akhilesh Yadav, Uttar Pradesh politics, Uttar Pradesh government

he Reserve Bank today kept key policy rate unchanged and said future policy action would be determined by the movement in inflation.

“On the basis of the current macroeconomic assessment, it has been decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 8.5 per cent,” RBI said in its mid-quarterly review.

It has also kept the cash reserve ratio (CRR), the portion of deposits which banks are required to keep with the central bank, unchanged at 4.75 per cent.

“...notwithstanding the deceleration in growth, inflation risks remain, which will influence both the timing and magnitude of future rate actions,” RBI said in its guidance for the future.

Inflation rose to 6.95 per cent in February which is much above the Reserve Bank’s comfort level of 5-6 per cent.

Last week, the RBI had reduced CRR by 0.75 percentage point to 4.75 per cent to infuse Rs. 48,000 crore into the system to mitigate pressure on account of payment of advance taxes.

Rail passengers, who have not experienced much of a fare hike in the past eight years, will be in for a shock when they buy ticket for journeys with effect from April 1, much as the Trinamool Congress has raised the red flag against its own Minister on the issue.

Hike in Rail Fares (PDF)

The “rationalisation” of fare is harsh on the short-distance traveller who will have to bear up to a 150 per cent increase, while the higher class passengers will be burdened with a hike by about 30 per cent.

In Dinesh Trivedi's Railway budget proposals for 2012-13, the hike is incrementally linked in terms of the distance of travel, besides the class and the train. The across-the-board fare hike will generate an additional revenue of Rs. 7,000 crore in 2012-13.

Mr. Trivedi proposes to introduce a fuel adjustment component in the fares. When it comes into being, the fares will go up further.

All fares have been rounded up to Rs. 5 that becomes the minimum fare for both suburban and urban commuters. The lowest fare of Rs. 2 is done away with.

The platform ticket will cost Rs. 5, up from Rs. 3.

All fares, second class suburban and non-suburban, ordinary second class mail and express, sleeper class, 1st class, AC classes and in Rajdhani, Shatabdi, Duronto and Janshatabdi trains, have been raised.

For second class suburban travel, the increase is 2 paise per km, which is the same as for non-suburban second class. In second class mail and express trains, it is three paise a km. The minimum distance for charge is 60 km.

For sleeper class, the increase is five paise a km.

For AC chair car, it is up by 10 paise a km. The minimum distance for charge is 150 km.

For AC 3-tier and first class, the increase is 10 paise a km.

For AC 2-tier, the increase is by 15 paise a km. The minimum distance for charge is 300 km.

For AC first class, the increase is 30 paise. The minimum distance for charge is 300 km.

While the second class non-suburban short-distance traveller, for a journey of up to 10 km, will have to bear a 150 per cent hike, there are other slabs which entail a 30 per cent increase.

The minimum fare in AC 3-tier coaches is Rs. 405 for a distance of 300 km. Travel up to 2,500 km means a fare of Rs. 1,690.

For travel by AC 2-tier, the minimum fare is Rs. 560 and for a distance of 2500 km, it is Rs. 2375.

In AC first class, the minimum fare is Rs. 955 and for a distance of 2500 km, it is Rs. 4,150.

Similarly, the rates for AC Duronto have been raised by up to 20-30 per cent depending upon the class.

Rajdhani fares go up by 23-30 per cent

Comments:

Why thinking about a fare hike? There are a lot of untapped areas in Railways to increase revenue.

from:  sajeeshkariyedath Posted on: Mar 14, 2012 at 14:36 IST

Instead of taking the railways to newer heights in terms of modernization,services and safety the railway-budget as always is presented without any substantial increase in rail fares(even for the AC class).This depicts the over-growing concern of Trinamool Congress for sympathy votes of "aam aadmi". This is not a good trend when price hike is an inevitable consequence of a growing economy and global market.Instead of burdening the government for development of Railways , a better decision on hiking the fares would have contributed a lot in developing this public utility. If the trend continues it will meet the fate of our aviation industry.

from:  Amit Adhikari Posted on: Mar 14, 2012 at 14:52 IST

The bad railway is going to be worse.

from:  Pramod Kumar Posted on: Mar 14, 2012 at 14:59 IST

And we go on shelling-out more. I wonder how Nehru wanted this to be like the then Soviet Union, when his own family was so capitalistic? And did he misread the pulse of the nation, which was materialistic to say the least? In his (Nehru's) family, let me be very clear, they wanted one set of behavior from others, and an entirely another set for themselves. It's amazing this country has continued voting for them, when simultaneously you've had leaping poverty, malnutrition, water & electricity shortage, chronic infrastructure, paralyzed bureaucracy, environment degradation, and the list of undone things is very long, and astonishing. The BJP as the principal opposition has only followed their systems, rather than influencing change, and getting elements back in order. But at least the BJP worked on various projects, unlike this Party (Congress) which

follows everything Western (from PR, to Marketing, to Media Mgmt, etc), thereby deliverance being zero. Reminds you of Nehru ('Western')?

from:  Sunit Jang Bahadur Posted on: Mar 14, 2012 at 15:21 IST

In the budget speech the rail minister mentioned -perhaps needlessly- several times the name of his party chief. It left one wondering whether the cabinet system is being followed in India, with Ministers owing their office to the PM. It is sad that the role fo PM is being diluted by these utterances.

from:  s subramanyan Posted on: Mar 14, 2012 at 15:26 IST

Atleast this rly minister dared to increase the fair across the classes, however minimal changes, but its a good move. The burden over rly has increased exponentially over the yrs, including the fuel price rise, the 6 CPC recommendation and other increasing input costs. The ever increasing passeneger expectations to bring hygienic and safe journey has not been fulfilled due to several impending reasons. The rly is truly the back bone of India, its running across the corners of the country. Only railway has dared to reach where other govt instruments haven't able to make their presence felt. Despite its huge social service objective, the organisation must not be sacrificed to be used as a mere political tools for ever, the leader at the helm must muster the courage to show some business mettle to run a business venture. Its a proffessional organisation, which required an apt management, we can't afford it to meet similar fate what most of the PSU's. Hope better sense prevail!

from:  anand jha Posted on: Mar 14, 2012 at 16:39 IST

This railway budget is effected the common people in the name of "difficult phase" going for the railway.

from:  Ajay Kumar Posted on: Mar 14, 2012 at 17:04 IST

The making of the poor people as the scapegoat in Indian politics need to be checked to avoid the worst form of exploitation. Most of the promising bills are stalled by the opposition and some other political parties giving the poor people's welfare as the reason. Should we allowed a free run of this politics????

from:  Hejang Misao Posted on: Mar 14, 2012 at 17:09 IST

Railways budget is not done in the longer interest of the country. The railway fare should accommodate the operational cost and contribute for future replacement of rolling stock and expansion of railway lines by doubling as well as laying of new lines so that common man can enjoy the fruits of developemnt. whereas the railway ministers always keep their political agenda in their mind and prepare the budget to suit their winning chances in the general elections and not bothered about the existance of the organisation. every indian is not bothered to pay reasonal fares compared to bus fares. even today the difference between the road fare and train fares ranges from 30 to 50 %. There fore I strongly recommend to increase the passenger fares reasonably so that the fares take care of future fund requirement of railways to improve its performance and lay more new rail lines to suit the needs of the people.

from:  sreeharinarayana Posted on: Mar 14, 2012 at 17:10 IST

The Railway Minister's budget today would be opposed by the common man who have not seen rise in Railway fare for nearly a decade. It is wrong move, he could have rationalized the freight rates on the other hand. He will earn more brickbats than bouquet.

from:  R. Bhavani Shankar Posted on: Mar 14, 2012 at 17:11 IST

It is reported during the Railway Budget that they will get 3000 crores from Govt@8.55% int. Instead Railways may be permitted to raise Development Bond Tax free at 3% from Indian Public which will reduce the cost of borrowing.Railways can revive their old plan of having dormitory hotels across the country which will give them a good revenue .To reduce the overheads Ticket issuing can be outsourced to handicapped public.

from:  VSBALASUBRAMANIAN Posted on: Mar 14, 2012 at 17:18 IST

I agree with people about their opinions on the UPA government. But i just have one question to put forth.. Do you honestly believe that removing congress from power and elevating another party, say BJP, to rule the country is going to help us?? Is it a given that the next party is going to do things any different? I mean, okay they might not do some bad things as blatantly as the present UPA does but still they too are going to fill their coffers whilst in power and leave the masses in licking their wounds. So why all this cry about the removal of UPA? Agreed they are maybe bad for the country. But ultimately their successors would also follow the same path albeit on a much lesser scale(hopefully). I feel all this anger against UPA has been instigated by the opposition parties only and not the common man's voice.. and that is because UPA have been in power for close to 10 years and they havent had a bite of the cherry in a long time. So friends please dont follow this polit(r)ic(k)s!!

from:  NIK Posted on: Mar 14, 2012 at 17:31 IST

Around 35% of India's population, earns Rs. 32 per day that is Rs. ~950 per month. In an ordinary class train, he can only travel 19 km in one month salary. The message is 'poor people should not travel'.

You will see more beggars in the trains now!

This budget is only for few percentage of India's population. It's definitely against 'common man'.

from:  Mukesh Posted on: Mar 14, 2012 at 17:34 IST

I dont understand all this protests surrounding the hike. It has only happened after 10 year and the price rise itself is a nominal one(5%-15%). Railways was the most profitable arm of the govt 10 yrs back but it stood still for 10 years. During those time there were innumerable hikes in Buses, fuel, food and basically everything else. Railway had to take this step to generate revenue so that they can in turn provide better facilities, newer trains and safe journey to the people. Where does everyone think the money for railway comes from... it has to come from the people..Better service comes at a price and in this case a small price

from:  Thomas Posted on: Mar 14, 2012 at 17:35 IST

Finally a brave step to increase the fares which was much needed. Hope this does not buckle under populist and political pressure.

from:  Harisharan Posted on: Mar 14, 2012 at 17:46 IST

Railways had cash reserves of Rs 19,000 crore in 2007-08, a major portion of which got depleted and railways was left with only Rs 5,000 crore in May 2010. Financial results of Railways between April and December were not very encouraging and it is believed that this year’s revenue target is not expected to be achieved. As per Railway Budget 2011-12, the current year budget will have a deficit of Rs 3,500 crore. By September 2011, cash reserves of railways had completely vanished. All this shows that railway’s health is already very poor. Recent demand for a bridge loan of nearly Rs 2,100 crore has surprised many as until recently railways ran a surplus and had been contributing significantly to the central budget by way of dividends. The railways has asked for this loan to facilitate its ongoing projects, which are getting affected due to the resource crunch in railways. Apart from this loan, Railway Finance Corporation Ltd. has also been asked to issue bonds for Rs 10,000 crore.

from:  shiyas Ibrahim Posted on: Mar 14, 2012 at 18:06 IST

I totally agree to hike in fares. Rising fuel prices and equipment costs have to be met with. New routes need to be laid and existing routes need to be repaired or maintained. The Indian Railways cannot just become another ailing PSU. Also a loss making railways will tremendously lower the morale of it's employees.

from:  Ashwini Kumar Posted on: Mar 14, 2012 at 18:06 IST

I personally feel the graduates from elite B-Schools and institutions with standing repute in economics studies should involve themselves in the management of these large governmental organisations to experiment innovative and cost effective management strategies. I wonder how the railways is termed to be in a 'bad phase' despite its employee unions not to reflect anything close to it. A detailed audit report of not the Railways as a whole but of all the regional railways should be made public(at least in their regions) for people to understand the spending culture in these organisations. After all, as they say, the devil is in the details!

from:  Bharadwaj Posted on: Mar 14, 2012 at 18:24 IST

Fine with me as long as they give the trains (especially in south India) a paint job. Trains in all directions are in depressing conditions, with leaky toilets and sometimes no water and the window sills are so grimy, even in First class or the ac compartments, one has to wash one's hands after opening them. Some improvement on railway platforms which now sport some dustbins and are kept fairly clean but it is a torture to arrive early and wait for a train as an announcer repeats the same news or the wrong information about train arrivals. We all know the timings of our trains and if they are late well there is nothing more to do but wait, and the waiting is bad enough but to have a shrill loud female voice shouting over the loudspeaker (especially in Coimbatore) Train No. XXX to destination XXX will arrive shortly at platform no 2, an instant later the same thing and this goes on ad infinitum. No chance to listen to the ipod music or have some peace and quite for a conversation

from:  angela alvares Posted on: Mar 14, 2012 at 19:50 IST

There is nothing wrong in marginal increase in the fares of the railways if the safety service part looks up.I would like to ask B.J.P. what is the bus fare in Bangalore which is

run by its Govt.In some places rs.7/- for a K.M. or less.I especially want to congratulate the bold R.M. who is putting the country before the party.But look at the P.M. He stood by the corrupt minister Raja and P.C. who is facing a case for cheating in election and also being a party in 2G scam.

from:  Shivaji Posted on: Mar 14, 2012 at 20:16 IST

A good move by Indian Railway.

from:  sumit kumar rai Posted on: Mar 14, 2012 at 20:40 IST

It's such a small price hike, especially after almost a decade of no increases in rail passenger fares! The Government can't subsidize everything. It's barely a hundred rupee increase for Delhi to Chennai sleeper class, and couple hundred for AC. People earn more now, and should quit making a scene. They can pay, no problem. And Mamata should quit her usual drama.

from:  Iyer Posted on: Mar 14, 2012 at 21:46 IST

This was a hike after 9 years. In 9 years the world economy has changed a lot. Trivedi's budget speech impressed me with the hikes being not harsh like that has happened recently in Tamil Nadu for road transport.This is a nominal raise and after 9 years and when people weren't opposing the party in its own has derailed it . Doesn't make sense.

from:  Vinodh Posted on: Mar 15, 2012 at 09:40 IST

                                     Your Name:                                        

email:               

Make a comment   

characters left

What is 9 + 9?  

1.  Comments will be moderated

2.  Comments that are abusive, personal, incendiary or irrelevant cannot be published.3.  Please write complete sentences. Do not type comments in all capital letters,       or in all lower case letters, or using abbreviated text.       (example: u cannot substitute for you, d is not 'the', n is not 'and').4.  We may remove hyperlinks within comments.5.  Please use a genuine email ID and provide your name, to avoid rejection.

VIDEO

Stay ahead with "The Hindu" more video »

Slideshow

Railway Budget 2012-13 With marginal fare hikes, new passenger trains and focus on safety, the Railway Budget 2012-13 hopes to put Indian Railways on the track of development and growth. more slideshows »

Sudoku - March 15, 2012

A mind game and a puzzle that you solve with reasoning and logic. »

<p> Your browser does not support iframes. </p>

Resources

Full Text of Economic Survey 2011-12

Full text of Railway Minister Dinesh Trivedi’s budget speech

President Pratibha Patil's address to Parliament - March 12, 2012

Transcript of interview with Norway Foreign Minister Jonas Gahr Store

Chidambaram's letter on NCTC to CMs

More Resources »

Economy Watch (column)

Mutiny of the minority shareholder

Taking American business back home

Chronic famishment

A crisis ignored

The Indian footprint of US firms

More »

Code of Editorial Values

Readers' Editor: Terms of Reference

Follow @The_Hindu

Social

Please remember to logout of facebook after you complete this session.

Today's Paper

ePaper This Day That Age Crossword Archives Obituary

Group Sites

The Hindu Business Line Sportstar Images Frontline

The Chinese Communist Party said on Thursday it had replaced its Chongqing chief, Politburo member Bo Xilai, in the wake of a political scandal that has been seen as dealing a blow to resurgent conservative-leaning forces in the party.

Vice Premier Zhang Dejiang has replaced Mr. Bo as Chongqing party secretary, according to a decision of the party’s Central Committee reported by the State-run Xinhua news agency on Thursday morning.

Mr. Bo, who had served as party chief in the south-western municipality since 2007, had emerged as a key figure in the next generation of the leadership that will come into office later this year as part of a once-in-a-decade transition.

Until recently, he was seen as a frontrunner to occupy a seat on the next nine-member Politburo Standing Committee, the small group of high leaders that effectively runs the country. Mr. Bo, like Vice President and likely successor to President Hu Jintao Xi Jinping, is among the most recognisable faces of the party elite, part of a second-generation of emerging leaders - the children of former revolutionaries - known here as the “princelings”.

His future had been cast under a cloud following an investigation targeting the former police chief Wang Lijun, once his close associate, and triggered heated discussion in recent weeks on China's vibrant microblogging community.

Mr. Wang appeared at a U.S. Consulate in Chengdu last month reportedly seeking asylum following a falling out with Mr. Bo, a rare open political scandal that had gripped China and also embarrassed the leadership days ahead of the annual parliament session.

His position appeared further weakened following Premier Wen Jiabao's comments to reporters on Wednesday, when he said Chongqing authorities needed to “seriously reflect on and draw lessons” from the incident which Beijing had “taken very seriously”.

He pointedly even appeared to question the leadership of Mr. Bo, who had recently emerged as a favourite among a resurgent New Left that has questioned the push for further reforms and called for a return to Mao-inspired populist policies. Mr. Bo's policies, dubbed by some as the "Chongqing model", included a greater emphasis on social welfare as well as campaigns to revive "Red culture", including the singing of red songs and sending students to work in the countryside.

Mr. Wen, who hinted that the push for further economic and political reforms had faced opposition, said  “the mistakes of the Cultural Revolution and feudalism have yet to be fully eliminated” although the Communist Party had adopted resolutions to take forward reforms in the wake of that disastrous decade.

Mr. Wen had appeared to come prepared to talk about Mr. Bo in some detail. He even invoked the CPC’s decision taken in 1978 at its third plenum to carry forward reform and opening up and draw a line over the Cultural Revolution, in an apparent reference to Chongqing's policies.

The unusual public criticism of another Politburo member had suggested that the party's highest leaders, including President and General Secretary Hu Jintao, had taken a decision to sideline Mr. Bo, whose less-than-promising fate now also leaves uncertain the aspirations of his many supporters.

Keywords: Chongqing scandal, Communist Party of China, Chinese political developments, Bo Xilai

Bashar al-Assad's brutal counter-insurgency crackdown in Syria raises many moral questions. It also raises a less moral, but critical question: does force really win wars?

“We've been preparing for the worst,” a senior Syrian Defence Ministry official said earlier this month, “for the past 40 years.”

For the past month, Syria's army has subjected the Bab Amr neighbourhood in Homs to a savage bombardment that has left thousands of civilians homeless, injured — and dead. Homs has seen the most murderous assault since the 1999-2000 siege of Grozny — reduced by Russian forces into what the United Nations described as “the most destroyed city on earth.”

Even though President Bashar al-Assad's lethal blows to his insurgent opponents have secured his regime, it has little chance of securing what might meaningfully be called a victory. There is good reason to believe that worse lies ahead: a long, dirty war that is about death, not winning.

In much of the world, the war in Syria is being written about in a language reminiscent of a morality play: a real-life allegory in which hope is fighting fear, democracy despotism, people tanks.

There is, however, one less-edifying lesson that needs careful attention. The Syrian case demonstrates the bankruptcy of maximum force doctrines as a response to existence-threatening insurgencies many states across the world face or fear. In India, wherever greater force is being committed to stamp out the growing Maoist insurgency, the lesson is urgent.

Syrian insurgency

Hassan Ali Akleh marched out into the main street in the small town of al-Hasakah last January, armed with a can of kerosene, and set himself on fire. The previous year, a similar gesture by a young Tunisian sparked off what came to be called the Arab Spring. For six weeks after Mr Akleh's self-immolation, though, Syria was quiet. Then large-scale protests broke out, often ending with forces regularly firing on — and killing — demonstrators.

In June, a slain protester's funeral march in the town of Jisr al-Shughour — a historic centre of Islamist resistance to the ruling Ba'ath party — turned violent. The local police station was sacked, and several officers were lynched. Later, military defectors and the local militia ambushed a patrol sent in to contain the violence. Hundreds of armoured vehicles were used to back a subsequent military assault, which pushed the insurgents — and as many as 10,000 civilians — across the border.

But the insurgent campaign — barbarous in its own right — continued to escalate. In September, insurgents succeeded in holding off a military assault on the town of Rastan for four days. From October to December, the rebel forces staged successful hit-and-run raids on convoys travelling through the Jebel al-Zawiya region. In January, they registered their first significant success, repulsing an armoured assault on Zandabani, just 30 km from Damascus.

Late last year, the insurgents evicted from Rastan set up base in the Sunni-dominated Bab Amr neighbourhood of Homs. The army tried, without success, to evict them from dug-in positions in the city — and then, after weeks of skirmishes, began shelling the entire area. From satellite pictures, it is clear the firing was indiscriminate.

Five decades ago, the French Special Forces officer, Roger Trinquier, described the military machine fighting in Algeria as “a pile-driver attempting to crush a fly”. President al-Assad's military was doing precisely the same thing —and, like the French, failed. The regime's tactics, scholar Joseph Holliday has pointed out, dispersed the insurgents from held positions, but “generated [new] pockets of rebel control that will stretch security forces thinner still.” Fresh units have spread out into areas like Idlib and rural Hama — armed by states like Saudi Arabia.

From December to February, there were also three car-bomb strikes — attacks James Clapper, the United States' Director of National Intelligence, said “bore the earmarks” [sic.] of the al-Qaeda. Fighters from jihadist organisations earlier involved in Iraq — many of whom transited through Syria, with the quiet support of its intelligence services — have joined the insurgents' ranks.

Nir Rosen, in a rich account based on extensive time with rebel groups, noted that Islamist organisations were acquiring increasing influence on the rebellion's political culture. Increasingly, the language of the rebellion suffused with religious chauvinism, suggesting that the prospects for a negotiation built around secular-democratic values are rapidly diminishing.

Lessons for armies

In an evocative 2000 article, communist leader Riyad al-Turk described Syria as “the kingdom of silence”: a state which ruled through a single instrument, fear. Few military historians, though, would be persuaded by the proposition that the Syrian army's way of warfare derives from the regime's world-view.

From the time of Timur Lang, armies serving quite different kinds of regimes have fought rebellions in similar ways. Less than a decade ago, the United States' twin campaigns against insurgents in the Iraqi city of Fallujah led to the levelling of between two-fifths and a third of the city's buildings — and the death of over 1,000 civilians. Lethal white phosphorous bombs were dropped on Fallujah; there is evidence that dozens were executed in cold blood.

Indian soldiers who, ever since the bombing of Aizawal by the air force in 1953, have carried out counter-insurgency operations without heavy weapons or air support, nonetheless burnt down hundreds of homes in Sopore in 1993. Pakistan's campaign in Waziristan has inflicted devastation with regularity.

These armies learned, as historian Christopher Coker wrote of Fallujah, that “hearts and minds cannot be won by using Abrams tanks, armoured personnel carriers, fighter-bombers, and C-130 gunships within the confines of a modern city”.

How is it, then, that militaries continue to make the same mistakes? The case of Syria's army is instructive. From 1973 to 1997, Syria's military grew from 118,000 to 421,000 — all designed to ward off a perceived existential threat from Israel, which had half as many soldiers but access to vastly superior military technologies and equipment. The collapse of the Soviet Union hollowed out this massive force, reducing it to a pool of ill-trained manpower.

“Large elements of Syrian forces,” scholar Anthony Cordesman wrote in an authoritative 2007 survey, “have become garrison units with limited recent practice in moving and operating outside of their bases and caserns”.

Syria's combat-fatality figures — 800 insurgents killed, against up to 2,700 soldiers — make clear how poor its fighting skills were — and why the seduction of maximum force was so strong.

Philosophies of war

In 69AD, the stoic philosopher, Musonius Rufus, lectured imperial Rome's legions on the evils of a looming civil war. He was saved, historian Cornelius Tacitus tells us, because he “listened to the warnings of the quieter soldiers and the threats of the others, and gave up his untimely wisdom.” In centuries since, human rights organisations had somewhat better success in their struggle against barbarism. In many militaries, these codes are deeply internalised.

Yet, we know from the experience of United States troops in battlefields from Vietnam to Iraq and Afghanistan, that barbarism continues to flourish, even when soldiers aren't fighting existential enemies at home. From the memoirs of British soldier Tony Banks, it has emerged that troops in the Falklands received orders to take no prisoners — and did what they were told.

Tacticians of counter-insurgency often respond to criticism of barbarism by noting no one has devised a clean way of fighting dirty wars. Even Britain's anti-communist campaign in Malaya, often invoked to illustrate how insurgencies can be defeated without barbarism, involved torture and population displacement. Historian David Benet has noted: “coercion was the reality — ‘hearts and minds' the myth”. Field Marshal Gerald Templar, the architect of the Malaya campaign, called ‘hearts and minds' “that nauseating phrase I think I invented.”

Yet, advocates of maximum force must also concede that power alone doesn't win wars: India's counter-insurgency successes have come from patient police actions that sought to restore order, not secure victory. From the work of scholars like Ivan Arreguin-Toft, we also know this: asymmetrical wars and insurgencies are increasingly ending in grim stalemates. From 1800-1842, states decisively won 88.2 per cent of wars; in 1950-1998, that figure had come down to 45 per cent. Barbarism is an excellent tool for desolating the ranks of enemies — but it rarely wins peace.

Part of the answer to insurgencies, perhaps the greater part, lies in a politics that pushes states to respect human aspirations and rights — addressing the complex networks of causes that underpin all wars.

Part of the answer, however paradoxical it might seem, must also lie in thinking about how to fight wars better: a task that cannot, and ought not, be left to militaries alone.

Keywords: Bashar al-Assad, Syrian insurgency, Syria unrest, Syrian army, insurgency

Syrian regime forces on Thursday seized full control of the Baba Amr district of powder-keg Homs after rebels pulled out “tactically” in the face of relentless shelling and a deadly ground assault.

With the rebel fighters in retreat, the opposition Syrian National Council (SNC) said in Paris that its newly-created “military bureau” would from now on coordinate the armed resistance against President Bashar al-Assad's regime.

The all-out assault on Homs's defiant neighbourhood came as international envoy Kofi Annan said he hoped to go to Damascus with a clear message that the “violence must stop”, and the U.N. Human Rights Council called on Damascus to allow relief supplies in to besieged protest cities.

Gulf states, which have been at the forefront of international calls to supply arms to the rebels, said they will hold talks next week with key Damascus ally Moscow, which has so far blocked Arab and Western efforts to take action through the U.N. Security Council.

Britain announced that it was following the United States in closing its embassy and pulling out its remaining diplomats in response to the “deterioration of the security situation in Damascus”.

Rebel fighters said on Thursday they had pulled out from Baba Amr after nearly two days of an all-out assault by the dreaded Fourth Armoured Division, led by a younger brother of President Bashar al-Assad, Maher.

Rebels “have pulled out tactically in order to protect the remaining civilians”, said Colonel Riyadh al-Asaad, the leader of the free Syrian Army, which is made up mostly of deserters.

A Syrian security official said in Damascus that the army was in total command of the rebel bastion on the 27th day of bombardment targeting the defiant neighbourhood.

The Syrian Observatory for Human Rights said 21 people were killed in Homs on Thursday, including 17 civilians caught up in the battle for control of Baba Amr. The opposition SNC said the military bureau, announced on Wednesday, would coordinate the flow of weapons to the rebels.

Keywords: Syria unrest, Bashar Assad regime, Syrian National Council, Free Syrian Army

Given India's fractious politics, a Railway budget wouldn't be a Railway budget if the Opposition didn't accuse it of being “anti-people.” But when the charge comes from the Treasury benches — and from the coalition partner to which the hapless minister belongs, whose leader then goes on to demand his sacking — the signals this sends out about the state of the government are not at all encouraging. Considering the financial crisis the Indian Railways is passing through, Railway Minister Dinesh Trivedi has tried to arrest the slide. But the method he has chosen hits poor citizens the hardest. Ironically, it was his predecessor, Mamata Banerjee's pursuit of a political agenda in West Bengal that sent the railways down a dangerous financial track. The problem with populism is that it is impossible to sustain indefinitely. For eight years, successive Railway ministers took pride in never raising fares. Of course, when the deferred rise eventually comes, the one-shot hike hurts more than if there had been continuous but marginal increases over a longer period. So while Ms. Banerjee is obliged to decry Mr. Trivedi's fare increases — which range from 20 per cent to 150 per cent depending on the fare class and distance travelled — she must share the blame for this kind of crisis budgeting. The Minister tried to soften the blow by a major pre-budget revision and rationalisation of freight tariffs that should raise Rs. 20,000 crore a year. But the opposition to his budget makes a fare hike rollback for the poorest of passengers inevitable.

Where Mr. Trivedi has scored is in his focus on safety. Besides setting up a Railway Safety Authority as a statutory regulatory body as recommended by the Kadkodkar Committee, tracks, bridges, signalling and telecommunications, rolling stock, stations, level crossings and freight terminals will all be focus areas. Mr. Trivedi's decision to pursue the redevelopment of stations through the PPP mode may help upgrade passenger facilities but the contracts and projects must be carefully audited. He also said a Logistics Corporation will take on freight, and a national High Speed Railway Authority will be set up to look at the six corridors identified for development. However, the key index the Railways has to look at is the Operating Ratio — the amount spent to generate Rs. 100 in revenue — which has climbed to 95 per cent. Mr. Trivedi intends to bring this indicator down to 84 per cent in the coming year. The long-term health of the Railways depends on meeting that efficiency target and going beyond it; squeezing a few extra rupees from those passengers who may least be able to afford it is hardly the answer.

Keywords: Railway Budget, Dinesh Trivedi, Kadkodkar Committee, railway fare hike, Railway Safety Authority, railway safety

The United Nations special rapporteur on torture has just submitted his findings on Washington's prolonged and controversial detention of WikiLeaks hero Bradley Manning. Simply put, he has concluded that the punitive conditions imposed on him, before being pronounced guilty, amount to cruel, inhuman and degrading treatment. The former U.S. intelligence analyst has been under incarceration since May 2010 for allegedly having leaked secret State Department cables to the whistleblower website WikiLeaks. Mr. Manning is charged with over 20 offences, of which that of aiding the enemy could even attract the death penalty. The United States government has hampered investigations into his treatment — including solitary confinement for eight months, ostensibly to prevent him from causing harm to himself. Significantly, the U.N. special rapporteur, Juan Mendez, who has concluded his 14-month investigation, was denied a private interview with the detainee. The findings, which form part of his report last week to the U.N. Human Rights Council, is the latest attempt to elicit U.S. cooperation in the investigations into Mr. Manning's incarceration. Earlier, over 50 members of the European Parliament and hundreds of American legal scholars had written to the U.S. Congress noting that 17 months had elapsed in bringing the accused before a pre-trial court.

Mr. Manning's treatment is reminiscent of the Central Intelligence Agency's infamous enhanced interrogation techniques used with impunity during the Bush era against detainees at Guantanamo. Significantly, the White House today is guilty of supporting the very kind of extra-judicial methods that Barack Obama the candidate pledged to end and even outlaw in the run up to the 2008 elections. While the Bush administration at least allowed the Red Cross to have access to Guantanamo inmates, the current administration has taken a step back in refusing to allow the U.N. rapporteur to meet privately with Mr. Manning. The Manning case is proof yet again of the hypocrisy and double standards that govern Washington's attitude towards human rights and the rule of law. Equally disturbing, from the point of view of international precedent, is the fact that Washington seems intent on making an example of someone who is essentially a whistleblower. The financial targeting of WikiLeaks is of a piece with the same vindictive mindset. States are entitled to protect their secrets and punish those who break the law. But there is a line they must not cross in trying to do so. In the Manning case, the U.S. has crossed that line.

Keywords: whistleblower, WikiLeaks, Bradley Manning, U.N. Human Rights Council, human rights

Tweet0inShareState Bank of IndiaBSE

2295.00

-56.50 (-2.40%) Vol:607867 shares tradedNSE

2296.80

-58.00 (-2.46%) Vol:2228545 shares tradedPrices|Financials|Company Info|Reports

RELATED ARTICLES

Facebook signs $8 billion credit deal with lenders UBS in revival mode, to focus on transaction banking space RBI signals a downward bias in interest rate cycle: S Raman, CMD of Canara

Bank Banks resilient despite rising NPAs, pressure on margins: Care Europe bank pullback absorbed as rivals step in: BIS

<a target="_blank" href="http://netspiderads2.indiatimes.com/ads.dll/clickthrough?slotid=37105"><img alt="Advertisement" height="71" width="640" border="0" src="http://netspiderads2.indiatimes.com/ads.dll/photoserv?slotid=37105"></a>In a chat with ET Now, Deven Choksey, MD, KR Choksey Securities shares his views about RBI credit policy.

What is the expectation from the RBI after a 75 bps CRR cut that we already have seen while yesterday you have the bond markets rally as well as banking equities, what is it indicating to you in terms of what the RBI may do today?

If I look at the liquidity positions right now after the CRR cut of 75 bps releasing Rs 48,000 crore into the system. There is still a short fall of about Rs 12,000 crore, the total short fall in the system is close to around Rs 60,000 crore. So there is a distinct possibility that RBI may once again bring down CRR by another 25 bps and allow the system to take its course and probably stay liquid.

Budget at ET: Budget 2012 | Union Budget | Railway Budget 2012 | Economic Survey 2012 Live

More importantly liquidity in the system should help the banks to bring down the interest

rate going forward. They may not take immediately the rate cut measures in this particular policy. We will probably wait for the next month but if CRR cut is done then probably they would be doing at least some amount of liquidity infusion which is more expected.

If you translate this action into the banking stocks and the bottom line of the banking portfolios, some of the banks like State Bank of India would have a positive impact of close to around 3.5% on to the bottom line due to the portfolio provisioning norms on which they would probably get benefits. So at around 3.5% State Bank of India and some of the other banks like Axis Bank and private sector banks would have correspondingly some amount of gains to talk about at the bottom line. So generally it would be seen as a positive move if RBI cuts 25 bps on the CRR. NEW DELHI: The Supreme Court's decision to quash 2G licences has boosted the flagging anti-corruption movement led by Anna Hazare, after his ill health hit his movement.

It was the uproar over the government's inaction and delayed action in the 2G spectrum allocation scam that created the space for Hazare's anti-corruption movement. The apex court's decision to cancel all the 122 licences issued without auction in 2008 would be seen as a clear endorsement of the claims made by leaders of the anti-corruption movement. This will strengthen the credibility of the movement. The fact that Prashant Bhushan, a key member of Team Anna, was among those who filed petitions in the 2G case will give credence to this.

Hazare's movement had been in downswing in the aftermath of the late December fast in Mumbai, which failed to take off like the August effort in Delhi. With Hazare out of the picture on account of ill-health, the team's campaigning efforts in the assembly elections also made little progress.

The Supreme Court's order restores to a great extent the patina of the anti-corruption movement, whose members had come under attack for their less than stellar record on corruption.

"It is a salutary judgment and establishes a huge precedenta¦ It will go down the history and will change the way cases of corruption will be investigated in this country," Bhushan said. He said that it "will send a strong signal to the entire country and in particular the corporate world that this country is no longer willing to allow these corrupt corporates and the corrupt public officials to retain the benefits of illegal and corrupt acts."

NEW DELHI: The Supreme Court's decision to quash 2G licences has boosted the flagging anti-corruption movement led by Anna Hazare, after his ill health hit his movement.

It was the uproar over the government's inaction and delayed action in the 2G spectrum

allocation scam that created the space for Hazare's anti-corruption movement. The apex court's decision to cancel all the 122 licences issued without auction in 2008 would be seen as a clear endorsement of the claims made by leaders of the anti-corruption movement. This will strengthen the credibility of the movement. The fact that Prashant Bhushan, a key member of Team Anna, was among those who filed petitions in the 2G case will give credence to this.

Hazare's movement had been in downswing in the aftermath of the late December fast in Mumbai, which failed to take off like the August effort in Delhi. With Hazare out of the picture on account of ill-health, the team's campaigning efforts in the assembly elections also made little progress.

The Supreme Court's order restores to a great extent the patina of the anti-corruption movement, whose members had come under attack for their less than stellar record on corruption.

"It is a salutary judgment and establishes a huge precedenta¦ It will go down the history and will change the way cases of corruption will be investigated in this country," Bhushan said. He said that it "will send a strong signal to the entire country and in particular the corporate world that this country is no longer willing to allow these corrupt corporates and the corrupt public officials to retain the benefits of illegal and corrupt acts."F

NEW DELHI: Prime Minister Manmohan Singh on Tuesday assured industry that the Centre is making renewed efforts to open up foreign direct investment in multi-brand retail, despite Uttar Pradesh (UP) election results where the winning Samajwadi Party has opposed FDI in retail in its manifesto.

Singh told a delegate of senior members of industry body Assocham that the Centre is taking fresh efforts to evolve consensus amongst the various stakeholders on allowing FDI in retail.

"Manmohan Singh communicated to us that renewed efforts are being made to form consensus and open up multi-brand retail for foreign investment," Assocham senior VP Rana Kapoor said after the meeting between the industry body and the prime minister.

Assembly elections in the country's most populous state UP is seen as crucial indicator of the political fortunes of the ruling Congress alliance, which in turn could decide on allowing FDI in India. More so, since Samajwadi Party supremo and forthcoming UP chief minister Mulayam Singh Yadav has opposed any foreign corporate interest in retail during his campaign.

The country's top retailers too are getting mixed vibes on the FDI issue after the UP election results. The state was one of the first to have attracted local backlash in 2007,

when Reliance Retail was forced to shut down about a dozen shops due to opposition from politically powerful small shop-owners, farmers and middlemen.

"While FDI is good for the sector, I don't see the government going ahead with the move after the UP elections outcome," said Govind Shrikhande, MD at Shoppers Stop.

Retailers Association of India (RAI), which represents major big retailers in the country, says there's no clarity on whether FDI will be allowed or not.

"We are optimistic on foreign money coming into India because the sector needs it. But we will have to wait for some more time to get some sense," Kumar Rajagopalan, CEO at RAI, said.

In November last year, the cabinet allowed 51% FDI in multi-brand retail with stringent conditions on back-end investments, market accessibility and sourcing. But it had to put on hold its decision due to stiff opposition from key allies like Trinamool Congress and other political parties.

The Department of Industrial Policy and Promotion has since then started wider consultations with farmers, consumers and the food processing industry. Several global giants like Walmart, Tesco and Carrefour are waiting in the wings to enter India's multi-brand retail segment.

Manmohan Singh had then said he hoped to open up FDI in retail as soon as elections to the state legislatures of Uttar Pradesh and Punjab are over.

A section of the organised retail industry is still hopeful that reform will continue. "The government should continue with reforms by hopefully bringing FDI soon, irrespective of the outcome in state elections," Future Group chief executive Kishore Biyani said.

However, trade associations are in no mood to let go the issue off the hook easily.

"We are planning for a nationwide protest on the day of Holi and burn FDI posters and effigies to show our opposition. We expect to have around two lakh traders, retailers and manufacturing participating on the say," said Viren Shah, president of Federation of Retail Traders' Welfare Association.

Tweet1inShare

RELATED ARTICLES

Koramangala: Industrial growth, commercial activity bolster demand for private security services

Rail Budget 2012: Need to focus on finances, says ICICI Securities

Chart Check from Kotak Securities for Friday, March 09: HCL Tech, Lupin Funds mop-up through debt placements reach 1.64 lakh crore Economic growth and food security depend on healthy farm sector, whose pillar,

the farmer, is still...

<a target="_blank" href="http://netspiderads2.indiatimes.com/ads.dll/clickthrough?slotid=37105"><img alt="Advertisement" height="71" width="640" border="0" src="http://netspiderads2.indiatimes.com/ads.dll/photoserv?slotid=37105"></a>By Bibek Debroy

Food price inflation, and inflation in general, has become less of an issue. But it isn't an issue that will go away. Give it till June and inflation is likely to inch up again. Competition is a good antidote against price increases. It ensures efficiency and reduces price volatility. Logically, food price inflation should trigger and stimulate agricultural reform, so there is competition and supply-side changes can occur. But in practice, it often leads to greater distortions and state intervention, at least in short term.

What is the core issue? That is one of investing in agriculture and rural sector and injecting competition into market access by farmers, reducing intermediation. But the point is that government policies often prevent this. In output markets, producer price controls exist in several developing countries. Triggered by food price increases, across a range of countries, there have been interventions on consumption side, including price controls, consumption subsidies, food aid, food for work, cash transfers and elimination of taxes on consumption. Are these fiscally sustainable? Do they lead to additional distortions? Do they lead to supply-side adjustments or are they knee-jerk reactions?

To take but one example, in several countries, minimum support prices (MSPs) for agricultural commodities have been increased. Apart from contributing to food price inflation, this increases spread between prices paid to producers and subsidised prices charged to consumers, increasing the fiscal burden. Since MSPs need not always extend to all agricultural commodities and public procurement need not cover all commodities either, this creates perverse price signals and distorts resource allocation.

Just because other countries have introduced knee-jerk reactions, that doesn't mean they are rational. The proposed Food Security Bill needs to be considered against that backdrop. A Commission on Centre-State relations, set up on this, submitted a report in 2010. One of the sub-reports focused on lack of harmonised domestic market in agricultural products. This sub-report has the following kind of numbers from unification and harmonisation of agricultural markets:

- Reduction of post-harvest losses by 5-7% for grains and 25-30% for fruit and vegetables.

- Static gains of 10% through harmonising standards of farm products across states.

- Static efficiency gains of up to 20% because of disintermediation of distribution chains,

resulting in higher prices for farmers and lower prices paid by consumers (welfare gains are roughly distributed in a ratio of 40% for farmers and 60% for consumers).

- Savings in compliance costs by 5% after fiscal unification.

- Savings of up to 20% if there is a transition to a complete and unified GST and revenue gains of 25%.

- Increase in tax/GDP ratio by 1%.

- 30% reduction in transportation costs.

- Incremental growth in agriculture and allied activities by 2% because of static gains.

- Static increment to GDP growth by 1% because of removal of inter-state barriers alone.

- Increment by 2% if broader agricultural-cum-rural sector reforms are undertaken.

- Increase in export volume (not value) of agricultural products by 20%.

- More direct employment generation by five million a year.

With 230 million people under-nourished, the country awaits some comprehensive policy intervention from the government to tackle this haunting crisis. One of the most logical measures would be to provide a fixed amount of foodgrain to all citizens. But wouldn't the costs be enormous, ask sceptics?

The Center for Budget and Governance Accountability (CBGA), a Delhi-based think tank, crunched all the numbers and came up with the answer. It would take Rs 1.85 lakh crore every year to provide 24 crore households with adequate monthly food grains. This assumes that each household will be sold 23 kg rice at Rs.3 per kg, about 12 kg wheat at Rs.2 per kg and millets at Rs.1 per kg every month.

At present, the monthly food subsidy provided by the government is about Rs. 60,573 crore (as per 2011-12 Budget Estimates). So the government will have to mobilize Rs 1.25 crore in addition to this.

But, here's the rub: the government has provided for just Rs 79,800 crore in the proposed draft National Food Security Bill. That is about two-thirds of what is actually needed.

CBGA researchers say that what the government is planning is to make available food grain at low prices only to certain 'targeted' sections, that is, the below-povertyline population. "Dividing households into "priority" and "general" category and not universalizing the distribution of grains, seems to be a step backwards," says CBGA.

This is because the poverty line is pegged very low at Rs. 25 per day in rural areas and Rs.32 in urban areas. A large number of people are technically above this line but in reality are very poor. Also, the poverty line surveys are ten years old, and they missed out on thousands of people.

Given the widespread hunger and malnutrition, the government will have to get serious and "take the bull by the horns", says CBGA.NEW DELHI: Concerned over poor budget allocation for the farm sector, Agriculture Minister Sharad Pawar today said it may be difficult to implement the proposed Food Security Bill without adequate funds to boost agri- output, a must for increased foodgrain requirement.

"My grievance is only one -- the total budgeted provision for entire agriculture ministry is Rs 20,000 crore. And subsidy is, as of today, Rs 65,000 crore. It might go to Rs 1 lakh crore in the current year."

"Solution is that unless and until we increase production, we will not be able to implement, we will not be comfortable to implement this (Food Bill)," Pawar said.

The Food Bill, which aims to provide legal right over cheap foodgrains to 63.5 per cent of the country's population, has been referred to the Parliamentary Standing Committee.

When pointed out that the Food Bill was the pet project of UPA chairperson Sonia Gandhi, the minister said: "This is not a question of individual. This is a question of investment in agriculture."

The ambitious Food Bill, which is considered as a pet project of Gandhi, proposes to give legal entitlement to food to 75 per cent of the people in rural areas, including at least 46 per cent in the priority sections (which is the same as below poverty line families in the existing public distribution system).

Up to 50 per cent of people in urban centres will be covered under the proposed law, of which at least 28 per cent will be in the priority category.

Tweet1inShare

RELATED ARTICLES

Koramangala: Industrial growth, commercial activity bolster demand for private security services

Rail Budget 2012: Need to focus on finances, says ICICI Securities Chart Check from Kotak Securities for Friday, March 09: HCL Tech, Lupin Funds mop-up through debt placements reach 1.64 lakh crore Economic growth and food security depend on healthy farm sector, whose pillar,

the farmer, is still...

<a target="_blank" href="http://netspiderads2.indiatimes.com/ads.dll/clickthrough?slotid=37105"><img alt="Advertisement" height="71" width="640" border="0" src="http://netspiderads2.indiatimes.com/ads.dll/photoserv?slotid=37105"></a>By Bibek Debroy

Food price inflation, and inflation in general, has become less of an issue. But it isn't an issue that will go away. Give it till June and inflation is likely to inch up again. Competition is a good antidote against price increases. It ensures efficiency and reduces price volatility. Logically, food price inflation should trigger and stimulate agricultural reform, so there is competition and supply-side changes can occur. But in practice, it often leads to greater distortions and state intervention, at least in short term.

What is the core issue? That is one of investing in agriculture and rural sector and injecting competition into market access by farmers, reducing intermediation. But the point is that government policies often prevent this. In output markets, producer price controls exist in several developing countries. Triggered by food price increases, across a range of countries, there have been interventions on consumption side, including price controls, consumption subsidies, food aid, food for work, cash transfers and elimination of taxes on consumption. Are these fiscally sustainable? Do they lead to additional distortions? Do they lead to supply-side adjustments or are they knee-jerk reactions?

To take but one example, in several countries, minimum support prices (MSPs) for agricultural commodities have been increased. Apart from contributing to food price inflation, this increases spread between prices paid to producers and subsidised prices charged to consumers, increasing the fiscal burden. Since MSPs need not always extend to all agricultural commodities and public procurement need not cover all commodities either, this creates perverse price signals and distorts resource allocation.

Just because other countries have introduced knee-jerk reactions, that doesn't mean they are rational. The proposed Food Security Bill needs to be considered against that backdrop. A Commission on Centre-State relations, set up on this, submitted a report in 2010. One of the sub-reports focused on lack of harmonised domestic market in agricultural products. This sub-report has the following kind of numbers from unification and harmonisation of agricultural markets:

- Reduction of post-harvest losses by 5-7% for grains and 25-30% for fruit and

vegetables.

- Static gains of 10% through harmonising standards of farm products across states.

- Static efficiency gains of up to 20% because of disintermediation of distribution chains, resulting in higher prices for farmers and lower prices paid by consumers (welfare gains are roughly distributed in a ratio of 40% for farmers and 60% for consumers).

- Savings in compliance costs by 5% after fiscal unification.

- Savings of up to 20% if there is a transition to a complete and unified GST and revenue gains of 25%.

- Increase in tax/GDP ratio by 1%.

- 30% reduction in transportation costs.

- Incremental growth in agriculture and allied activities by 2% because of static gains.

- Static increment to GDP growth by 1% because of removal of inter-state barriers alone.

- Increment by 2% if broader agricultural-cum-rural sector reforms are undertaken.

- Increase in export volume (not value) of agricultural products by 20%.

- More direct employment generation by five million a year.

HYDERABAD: Civil Aviation Minister Ajit Singh today said the government will not bail out struggling air carrier Kingfisher Airlines, and it was the responsibility of promoter Vijay Mallya to steer it out of the crisis.

"The Government cannot and will not bail out private companies, but that does not mean we want private airlines to close down," Singh said at a press conference here.

He added that it was for Kingfisher promoter Vijay Mallya to marshal funds to bring the carrier out of the financial crisis.

Singh also said the Directorate General of Civil Aviation would submit its report on Kingfisher in a couple of days.

Meanwhile, Director General of Civil Aviation has said that Kingfisher Airlines did not stick to its recovery plan submitted to the regulator last month and the situation is a grave concern to the public and the Government.

Singh's remarks are in line with Finance Minister Pranab Mukherjee's statement in

Parliament yesterday that SBI has no plans to provide fresh loans to the debt-ridden company.

Mukherjee had said, "SBI has informed that currently there is no such plan to provide additional loan to Kingfisher Airlines."

The airline has a debt of Rs 7,057.08 crore. The financial crunch has hit its operations with dozens of flights being cancelled regularly. Tax authorities have added to its woes by freezing its bank accounts for non-payment of dues.

Mallya had told reporters that the airline was "facing a serious handicap" as its accounts are frozen and stressed, "We are not asking for bailout from the government but hope for help from banking sector to de-freeze our accounts".

The airline has apologised to passengers for the inconvenience caused by the cancellation of flights and said Mallya will meet pilots tomorrow over unpaid salaries.

Tweet2inShare

Wipro Ltd.BSE

424.00

-1.40 (-0.33%) Vol:57586 shares tradedNSE

423.70

-2.35 (-0.55%) Vol:945532 shares tradedPrices|Financials|Company Info|Reports

RELATED ARTICLES

Wipro share auction fetches Rs 750 cr for Azim Premji Trust Azim Premji Trust to sell 1,530-crore Wipro shares to fund education Nifty seen opening higher; Natco, Kingfisher eyed 'BUY' OR 'SELL' ideas by experts for Wednesday, March 14 'BUY' OR 'SELL' ideas by experts for Friday, March 09

<a target="_blank" href="http://netspiderads2.indiatimes.com/ads.dll/clickthrough?slotid=37105"><img alt="Advertisement" height="71" width="640" border="0" src="http://netspiderads2.indiatimes.com/ads.dll/photoserv?slotid=37105"></a>MUMBAI/BANGALORE: Azim Premji Trust's offer for sale of 3.5 crore of Wipro shares was not completely subscribed on Wednesday.

Put on sale through the newly-introduced auction route, the shares could manage only 71% subscription, receiving bids for 2.48 crore of shares, according to stock exchange data.

Wipro is expected to decide whether to accept the bids it has received or reject all of them by Thursday. The floor price for the offer was kept at 418, a 3% discount to Tuesday's closing price of 430.95 on BSE.

Azim Premji Foundation, a non-profit unit set up by the Wipro founder, was planning to raise nearly 1,463 crore to invest in education institutes that it is setting up in backward regions and Azim Premji University which started operations last year. Details of the price at which the Wipro shares will be allotted or of the major buyers were not immediately available. However, at the floor price, the trust can raise 1,037 crore.

"It is not that IT stocks are not doing well. There is no reason why all the shares (on offer) should not have been subscribed. Perhaps the market is very cautious. I can't think of any other reason," said an IT analyst with a domestic broking firm.

Azim Premji, the billionaire chairman of Wipro, had made a gift of shares worth over 8,846 crore to the Azim Premji Trust in 2010 to which he still holds voting rights. The sale of these 3.5 crore shares will also take Premji closer to meeting the Sebi requirement of at least 25% public shareholding in listed entities, reducing promoter holding by 1.4%.

Shares of Wipro closed at 424.40 on Wednesday, down 1.4% from the previous day's close on BSE.

NEW DELHI: India's headline inflation accelerated in February after a gap of five months, indicating that upside risks persist and diminishing hopes of a rate cut by the Reserve Bank at its monetary policy review on Thursday.

Inflation, as measured by the wholesale price index, rose to 6.95% in February from a year ago compared with a 6.55% increase in January, the commerce ministry said on Wednesday. Overall prices in the economy rose 0.44% during the month.

"The latest inflation number almost rules out a rate cut on Thursday by the Reserve Bank," said Madan Sabnavis, chief economist at CARE Ratings. "The reading, combined with the upward revision for December, shows that the problem of inflation has not been sorted out."

The government on Wednesday revised December's inflation to 7.7% from 7.5% announced earlier.

The latest data, however, offered some comfort in core inflation, which fell to 5.8% in February from 6.7% in the previous month. Core inflation, which excludes food and fuel inflation, is considered a good indicator of demand pressures in the economy.

But the decline in core inflation was more than offset by an increase in food inflation,

which rose to 6.07% in February against a contraction of 0.52% in January. Economists say food inflation is expected to rise further because the seasonal effect of declining vegetable prices has waned.

"The drop in year-on-year food inflation over the last two months should prove transitory, caused by unseasonal rains last year," said Sonal Varma, India economist for Nomura. "We expect it to revert to a normal 7-10% y-o-y range over the course of 2012."

Within the food basket, inflation in the category of eggs, meat and fish rose to 20% from 18.63% in the previous month. Inflation in milk prices stood at 11.7%, while that in vegetables turned positive at 1.52% after two months of contraction.

Inflation in manufactured products, which comprises 64.97% of the overall index, fell to 5.75% from 6.49%. Seven of the eleven indices under this category rose in February.

But risks due to suppressed inflationary pressures persist as commodity prices have moved up recently in the international markets. Crude oil prices have been hovering at $120 a barrel since February.

"We expect the increase in international crude oil prices to be partly passed on to domestic fuel prices," said Aditi Nayar, economist with ICRA. "Additionally, a revision of coal prices and an increase in electricity tariffs is likely in the coming months."

Inflation in primary articles rose to 6.28% from 2.25%, while that in energy declined to 12.83% from 14.21% in January.

While RBI has started loosening its monetary policy through cash reserve ratio cuts of 1.25%, economists say the bank will not cut key policy rates before April. "Most conditions for a rate cut have been met, but we expect RBI to wait until after the Budget before cutting the repo rate," said Varma. NEW DELHI: India should open up retail sector to foreign direct investment (FDI), the Economic Survey 2011-12 said.

Last year's economic survey too favoured a phased opening of foreign direct investments in multi-brand retail, saying it could help address concerns of consumers and farmers, besides bringing technical know-how.

Also see: Budget 2012 | Union Budget | Railway Budget | Economic survey

The survey had emphasised the need to curtail the margin between farm gate and retail prices. This it said could be done by modern supply chain management systems and retail sellers into the picture. A quick way to get at this is to allow foreign direct investment (FDI) in multi-product retail into India.

It had been stated that FDI in multi-brand retail could enable farmers to get higher prices and consumers to have to pay less. Initially limiting international multi-product retailers to a few outlets in each major city had been recommended. This was meant to prevent them from getting full control of the market and, at the same time, set an upper bound on the prices that other retailers will be able to charge for their products.

Tweet0inShare

EDITORS PICK

Economic survey recommends FDI in retail Economic Survey: Fuel pricing needs transparency Economic Survey: Banking biz may become riskier Central bank cautious on inflation: Nomura Inflation remains anchor point for policy: SMC Global

RELATED ARTICLES

India job market prospects to improve in next quarter: Survey Budget 2012: Government to pursue Lokpal bill in budget session Economic growth and food security depend on healthy farm sector, whose pillar,

the farmer, is still... Budget 2012: Majority of staff expects tax exemption limit to Rs 3L, says a

survey Andhra Pradesh plans 67,000-cr Agribusiness zone

<a target="_blank" href="http://netspiderads2.indiatimes.com/ads.dll/clickthrough?slotid=37105"><img alt="Advertisement" height="71" width="640" border="0" src="http://netspiderads2.indiatimes.com/ads.dll/photoserv?slotid=37105"></a>NEW DELHI: The Economic Survey 2011-12 was tabled in the Parliament on Thursday. The survey sees 2.5% agriculture growth in FY 12.

Budget at ET: Budget 2012 | Union Budget | Railway Budget 2012 | Budget News | Economic Survey 2012

Last year's economic survey stated the following on Agriculture and Food Management:

Pioneering work by agriculture scientists and the efforts of farmers had helped achieve a breakthrough in the agriculture sector in the 1960s, popularly known as the 'Green Revolution'.

High agricultural production and productivity achieved in subsequent years has been the main reason for attaining food security to a large extent. The country has not witnessed any big technological breakthrough in agriculture since then. The food safety net for each and every of the over a billion citizens-a number that is growing- requires enhanced agricultural production and productivity in the form of a Second Green Revolution.

Further, special attention is required for achieving higher production and productivity levels in pulses, oilseeds, fruits, and vegetables, which had remained untouched in the First Green Revolution but are essential for nutritional security. In this regard, achieving high production of poultry, meat and fisheries is also essential.

The relatively weak supply responses to price hikes in agricultural commodities, especially food articles, in the recent past brings back into focus the central question of efficient supply chain management and need for sustained levels of growth in agriculture and allied sectors.

The choice before the nation is clear-to invest more in agriculture and allied sectors with the right strategies, policies, and interventions. This is also a 'necessary' condition for 'inclusive growth' and for ensuring that the benefits of growth reach a larger number of people. NEW DELHI: The global recession only partially succeeded in slowing the Indian economy thanks to the robust growth in services at nearly 10 per cent in 2010-11 and 9.4 per cent this fiscal, says the latest Economic Survey.

Budget at ET: Budget 2012 | Union Budget | Railway Budget 2012 | Budget News

This apart, the northeastern states have powered the service sector growth, it adds.

Tabled by Finance Minister Pranab Mukherjee in parliament Thursday, the survey says that the service sector has continued to remain the driving force for the Indian economy with growth higher by 10 basis points this fiscal over the previous year.

"The industry sector contributes nearly 26 per cent to India's gross domestic product (GDP). However, maintaining the growth momentum, the service sector recorded expected growth rate to bottom out the industrial slow down across the globe," the survey says.

"The service sector along with the agricultural sector, placed India in the top fastest growing economies of the world despite the Eurozone crisis and North American economic instabilities."

The survey clearly says the economy has successfully navigated the turbulent years of recent global economic crisis because of the vitality of the service sector and its prominent role in India's external economic interactions.

The survey says the share of services in India's GDP has increased from 33.5 percent in 1950-51 to 55.1 percent in 2010-11 and to 56.3 percent in 2011-12. If construction is included, the share increased to 64.4 percent in 2011-12.

Analysing the performance of states in the service sector, the survey notes the highest growth are in the northeastern states of Arunachal Pradesh (34.9 percent) and Sikkim (30.1 percent).

Among the others, Goa with 20.1 percent and Bihar with 16.6 percent growth top the list. "This is over and above their very high growth rates in 2008-09. Others with higher than national average growth are Kerala, Tamil Nadu, Maharashtra and Mizoram."