Thursday, March 29, 2012

Bad politics and India's future; Feuds roil Asia's family businesses; Social media on Middle East fingertips; Expats endangered species in Asia

1 Bad politics and India’s future (Soutik Biswas, BBC) The quality of India's politicians, many argue, has declined drastically, as in many parts of the world. Most of them seem to be out of sync with modern day realities - expectations have fallen so ridiculously low that an iPad carrying politician is described by the media as a modern one! Most are also seen as greedy, corrupt and disinterested in serious reform. The increasing number of politicians with criminal records and the brazen use of money to buy party tickets and bribe voters erodes India's ailing democratic process.

It is not a happy picture. "Today the Centre is corrupt and corroded," historian Ramachandra Guha wrote recently. "There are allegedly 'democratic' politicians who abuse their oath of office and work only to enrich themselves; as well as self-described 'revolutionaries' who seek to settle arguments by the point of the gun." Only serious electoral reform can ensure a better breed of politician. But to believe that less politics is good economics is a bit fey. There is little evidence to argue that political instability has been bad for India's economy.

India's first flush of economic reforms was launched by a minority government headed by PV Narasimha Rao of the Congress party in the early 1990s. The reforms spluttered to a halt when the government secured a majority. Later, a rag-tag 13-party coalition United Front government helmed by two prime ministers in 18 months in the mid-1990s undertook significant reforms, slashing taxes, deregulating interest rates and moving towards capital account convertibility. Economist Surjit Bhalla has argued that political instability is actually good for economic reforms. “If political stability is present, the politicians are unlikely to make an effort because of their inherent short sightedness or complacence”, he said.

2 Feuds roil Asia family businesses (BBC) From Samsung in South Korea and India's Reliance Industries to Hon Hai, the Taiwanese maker of the iPad, family businesses dominate Asia's, and increasingly the world's, corporate landscape. But these corporate dynasties, most founded in the aftermath of World War II, are facing new challenges as their elderly founders hand over the reins to the next generation.

The business - and gossip - pages of Asia's magazines and newspapers are rife with examples of corporate families locked in bitter court battles over the family fortune: Last month, Lee Kun-hee, the 70-year-old the chairman of electronics giant Samsung, was sued by both his brother and sister over company shares left by their late father. In December, Winston Wong, eldest son of the late Taiwanese tycoon Wang Yung-ching, sued to recover $4bn worth of disputed assets that he claimed were siphoned off by members of his father's third family.

India's richest man, Mukesh Ambani, became embroiled in a five-year dispute with his brother Anil over their father's vast Reliance empire. And in Hong Kong last year, a bizarre row erupted over the future of billionaire Stanley Ho's Macau casino business, that pitted Mr Ho against some of his own children. Given that many of Asia's tycoons are now in their 80s and 90s, the next decade will probably see a number of leadership successions.

3 Social Media on Middle East fingertips (Khaleej Times) On March 6, micro-blogging service Twitter announced the launch of its Arabic, Persian, Hebrew and Urdu versions. It all started with the grassroots ‘Lets Tweet In Arabic’ campaign by a handful of users who wanted Twitter to be available in more languages. With these four new additions, Twitter is available in a total of 28 languages. On its blog, Twitter representatives said that right-to-left languages posed a ‘unique’ technical challenge that was overcome by its engineers. The translation itself was made possible thanks to the participation of over 13,000 volunteers who helped translate Twitter’s menu options and support pages.

The company explained that those who donated their time and skills are a diverse group including a Saudi blogger, Egyptian college students, Lebanese teenagers, IT professionals in Iran and Pakistan as well as an Israeli schoolteacher. Social networks were arguably important for successfully mobilising recent movements in the Arab world. The 13,000 volunteers’ efforts to make social media available in new languages are a testament to the desire and the need to make the Internet-democracy dream a reality. As online networks open up to more people around the world, access to online tools will slowly cease to be the privilege of an educated multilingual middle-class.

4 Leaked letter discomfits India Army (The Wall Street Journal) The battle between the India army chief and the government escalated yet again when a letter written by General VK Singh to Prime Minister Manmohan Singh about the army’s lack of preparedness was leaked to the media. The contents of the leaked letter confirm what has been said repeatedly in the past by defense experts: India’s army faces many shortcomings as a fighting force. Gen. Singh reportedly said in his letter that the army’s tanks were “devoid of critical ammunition to defeat enemy tanks. The letter also said the infantry is “crippled with deficiencies of crew served weapon” and lacks “night fighting” capabilities.

This week, two months before he was due to retire, Gen. Singh told The Hindu that he was offered a bribe to clear the purchase of military vehicles, which he claimed were substandard. He had also claimed that he informed Defense Minister AK Antony of the incident and nothing was done. A day later, Mr Antony fired back, saying when he addressed Parliament that he had asked Gen. Singh to take action but the general “didn’t want to push this matter.”

5 Expats are endangered species in Asia (The Wall Street Journal) Forget expats. Western companies doing business in Asia are now looking to locals to fill the most important jobs in the region. Behind the switch, experts say, are several factors, including a leveled playing field in which Western companies must approach newly empowered Asian companies and consumers as equals and clients—not just manufacturing partners.

Three out of four senior executives hired in Asia by multinationals were Asian natives already living in the region, according to a Spencer Stuart analysis of 1,500 placements made from 2005 to 2010. Just 6% were non-citizens from outside of Asia. A failed expatriate hire can be a costly mistake and slow a firm's progress in the region, said Phil Johnston, a managing director at recruiter Spencer Stuart.

6 South Africa downgraded thrice in 4 months (Johannesburg Times) The government and analysts have criticised as "harsh" the latest downgrading of South Africa's economic outlook, its third in four months. This week, Standard and Poor's downgraded the nation's economic outlook from stable to negative, citing social unrest and continuing political debate as concerns. The US-based agency said the outlook was bleak because high unemployment and a bloated government wages bill were likely to be part of the 2014 national election debate and could push the ANC into a shift in policies.

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