1 Growth crisis undercuts India influence (Sadanand Dhume in The Wall Street Journal) As Manmohan Singh meets Barack Obama on what is likely his last visit to America as India's prime minister, US-India relations stand at a proverbial crossroads. Not so long ago, many in Washington viewed the 2008 civil nuclear deal as marking the advent of a dynamic partnership with the potential to transform Asia and the world. Today, ties between the world's oldest and largest democracies are just as often characterized as listless or oversold.
Some of the hiccups in bilateral relations can be traced to poor economic decisions by both countries. In America, overzealous advocates of immigration reform in the Senate have targeted India's flagship information technology industry by proposing restrictions on firms that employ a high proportion of foreigners on skilled worker visas.
New Delhi's self-inflicted economic wounds—caused by a combination of policy paralysis, populist spending and stifling red tape—have only made things worse. HSBC expects India's gross domestic product to grow only 4% this year, compared to 10% six years ago. Needless to say, India's lagging growth makes the logic of a big US bet on it look a lot less compelling.
A strategic partnership built on weak economic foundations will likely flounder. With $92.3 billion in two-way trade last year, India is only America's 13th largest trading partner, falling between the Netherlands and Venezuela. Meanwhile India's sharp slowdown—at a level of per capita income that still lags both China and Indonesia—raises questions about whether it will live up to forecasts that have underpinned its rise to prominence in Washington.
Time is not on India's side. After nearly a decade of stuttering reforms, both foreign and domestic investors are looking at the country with greater skepticism than at any time since the onset of liberalization in 1991. India already lags most of East Asia in terms of both income and human development; it can scarcely afford to slip behind further. If growth continues to stall, it will jeopardize both the US-India strategic partnership and India's rise as a global power. If Mr. Obama is frank, this is the message he'll deliver to his visitor on Friday.
http://online.wsj.com/article/SB10001424052702303342104579098732786221124.html?mod=WSJINDIA_hpp_MIDDLEThirdNews
2 US tapering and the Fragile Five (Linda Yueh on BBC) Whilst tapering the cheap cash injections and an end to the Fed's economic stimulus could begin to spell a return to normality for the US economy, it could have serious ramifications for five large emerging economies in particular. Dubbed "The Fragile Five" by Morgan Stanley, these are the countries judged to be most at risk when tapering finally begins. The group includes Indonesia, South Africa, Brazil, Turkey and India.
What do they all have in common? Well, they all have large current account deficits - the broadest measure of the trade gap - which means that they rely on external financing. So, these countries have relied on money flowing into their borders, and now that investment may leave when the end of the era of cheap cash looms.
Plus, foreign investors are worried about political risk because all five have elections set for next year. That raises uncertainty. Perhaps one reassuring thought is that there has been some time for these economies to prepare for the inevitable end of cheap cash. As for the end of this era of cheap cash, it may be next month, December or perhaps January when Fed chairman Ben Bernanke leaves office. The key question is whether there has been enough time for the rest of the world to prepare their economies for the inevitable.
http://www.bbc.co.uk/news/business-24280172
3 Onion turns kingmaker in India (Neeta Lal in Khaleej Times) The specter of relentlessly rising onion prices is haunting Indian politics yet again. As the market rate of the odoriferous veggie quadrupled over the last month, touching Rs 90 a kg in some parts of the country, it has become a hot button issue not only for the haus frau, but for economists and policymakers as well.
The liliaceous
plant, whose bulb is a staple in Indian curries, has pushed incensed women and
men onto the streets, giving the ruling UPA government sleepless nights. After
all, the party knows only too well that the potent commodity can be a political
game changer. Its rival — Opposition party (BJP) — had to suffer an ignominious
defeat in the 1998 Delhi and Rajasthan Assembly elections, all because of its
government’s failure to curb the northbound prices of onions. Having been
stung by the onion once, the BJP is trying to cash in on the current crisis.
Ironically, this
is despite India being the world’s second largest producer of onions after
China. Yet, it has the third-lowest yield per hectare among the 20 biggest
producers. Voters have a way of settling scores — something the political class
knows too well. Be it the late Pramod Mahajan on whom agitated Nashik farmers
had hurled onions in 2000 or the BJP that met its nemesis in Delhi and
Rajasthan in 1998, onions do have the power to deep-fry politicians. And
this time round, onions will likely give the BJP a chance to take sweet revenge
on a lachrymose Congress. The latter’s tears of grief just might turn out to be
Modi’s tears of joy!
4 Jesus as first tweeter (Johannesburg Times) Jesus Christ was the world's first tweeter because his pronouncements were "brief and full of meaning", Vatican cardinal Gianfranco Ravasi has said.
Christ "used tweets before everyone else, with elementary phrases made up of fewer than 45 characters, such as 'Love one another'," said Ravasi, the Vatican' equivalent of a culture minister. The cardinal emphasised the importance of clergy making full use of modern-day computer technology."If a cleric, a pastor, is not interested in communication, he is defying his duty," he said. Pope Francis has more than 3million followers on Twitter in English alone.
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