Chidambaram hopeful of 9 p.c. growth

Union Finance Minister P. Chidambaram after presenting the Economic Survey 2007-08 in Parliament on Thursday.

NEW DELHI: With the country’s economic fundamentals strong and investment climate full of optimism, Finance Minister P. Chidambaram on Thursday exuded confidence on achieving an average GDP growth of nine per cent during the Eleventh Plan period (2007-08 to 2011-12) while reining in inflation alongside.

As for the outlook for 2008-09, Mr. Chidambaram said: “Optimism, but with caution, is the watchword” while commenting on the policy prescriptions of the Economic Survey 2007-08 which projected a lower GDP growth of 8.7 per cent for the current fiscal and, in that light, viewed sustenance of a high growth as a daunting task.

Speaking to newspersons immediately after tabling the Survey in Parliament, Mr. Chidambaram pointed out that the country was required to respond to the evolving global economic situation so as to ensure that its growth was not affected and this, he said, could be achieved by capitalising on the opportunity arising from the “favourable” conditions.

“I am optimistic about growth and containment of inflation in the coming year [2008-09],” he said, while noting that his priority was to provide a conducive investment climate and manage the macro economy to facilitate non-inflationary growth.

Reading out from a prepared statement which was later released to the press, Mr. Chidambaram said: “Keeping inflation under control in an uncertain global environment will be one of the major challenges in 2008-09.” He noted that the current slowdown and possible recession in the global economy posed risks to growth.

On the rise in domestic savings and investment, the Finance Minister said: “We are confident of meeting the 11th Plan target of 9 per cent average growth.”

The high GDP growth, he said, had benefited the common man as well, as this was reflected by a near doubling of the annual growth rate of per capita consumption to 5.1 per cent in 2007-08 compared to 2.6 per cent for the previous 11 years. “If the rate of growth of per capita GDP continues at the five-year average of 7.2 per cent per year, the average income would now double in a decade instead of a generation or more, earlier,” he said.

Expressing concern over the slow pace of growth in the farm sector and bottlenecks in infrastructure development, he stressed the need for mobilising public and private resources for “inclusive” growth.

In a note of confidence, the Finance Minister said: “I am optimistic about growth and containment of inflation in the coming year. It will be my priority to continue to provide a conducive investment climate and manage the macro economy to facilitate non-inflationary growth. We have to ensure that the benefits of this growth percolate to the most marginal and vulnerable segments of society.”

Sustaining 9 p.c. growth will be tough: Survey

NEW DELHI: Holding out a warning that the current slowdown in the U.S. would have an effect on the Indian economy, the Economic Survey 2007-08 maintained that sustaining a high GDP growth of nine per cent while reining in inflation would be a tough challenge.

Tabled in Parliament by Finance Minister P. Chidambaram on Thursday, the Government’s pre-Budget annual economic progress report said that in the current uncertain scenario, an increase in the overall growth to double digits would entail additional reforms and came out with a policy prescription.

Among the various measures suggested to sustain the high growth momentum, the Survey favoured partial sale of the identified profit-making non-navaratna public sector undertakings (PSUs), phasing out control on sugar, fertilizer and drugs, sale of old oilfields to the private sector, a higher share for foreign equity in retail trade and further opening up of the banking and insurance sectors to foreign direct investment (FDI).

With the economy projected to grow at 8.7 per cent during the current fiscal, the Survey pointed out that the lower growth represented a deceleration from the unexpectedly high growth of 9.4 and 9.6 per cent in the preceding two years.

“Maintaining growth rate at nine per cent will be a challenge and raising it to two digits will be an even greater one,” the Survey said.

Linking the huge accumulation of foreign capital inflows as the reason for the pressure building up on prices, the Survey said that inflationary impulses from global commodity prices must be tackled through use of fiscal and trade policy instruments. Inflation this fiscal is projected to return to the earlier level of 4.4 per cent, down from 5.4 per cent in 2006-07.

Deceleration in growth this fiscal appears to have spread across all sectors except electricity, community service and services such as trade, hotels, transport and communications. More significantly, the slowdown in the farm sector growth is attributed to the sluggish trend witnessed in rabi crops.

Also, other sectors like manufacturing and construction which grew at 12 per cent in 2006-07 dropped by 2.5 percentage points in the current year. “The slower growth of consumer durables was the most important factor in the slowdown of manufacturing,” the Survey said.

As for the external sector, the U.S. economy is expected to slow down in 2008 as a fall-out of the sub-prime mortgage crisis. In fact, most projections of global economies anticipate a moderate and not severe slowdown.

“This will impact all countries including India, depending on the importance of the slowdown in different countries and importance of the country in our exports,” the Survey concluded, while pointing out that a further fall in exports to the U.S. might be unavoidable but would be relatively modest.

On the flip side, the Survey viewed that one of the implications of the U.S. sub-prime crises would be increased capital inflows into India and other emerging markets. “Thus the situation of excess inflows is likely to remain, though the pressure on reserve accumulation and exchange rate appreciation is likely to ease. Any reduction in excess capital flows from the high levels in 2007 may affect the equity markets in the short-term, but will make the task of monetary management easier,” it said.

Holding Karnataka elections by due date is mandatory

Chennai: The Election Commission of India’s resolve to go all out to conduct Assembly elections in Karnataka in May 2008, within six months of the premature dissolution of the House notwithstanding delimitation, is based on two key factors – Rule 24 of the Registration of Electors Rules, 1960 and a strong and unambiguous 2002 Supreme Court decision. Any political attempt to have the Karnataka contest put off by several months, possibly to November when elections will be held in Madhya Pradesh, Rajasthan, and Chhattisgarh, on the argument that delimitation has made it impossible to prepare the electoral rolls by the due date, will come up against these two strong factors.

President’s Rule was promulgated in Karnataka on November 20, 2007 and the Assembly was dissolved on November 28. Interestingly, the Delimitation Commission’s order redefining parliamentary and Assembly constituencies was issued in July 2007 but was given effect to only on February 19, 2008 through a presidential order. Assam, Arunachal Pradesh, Manipur, Nagaland, and Jharkhand were exempted from the scope of the notification but Karnataka was not.

First, as a leader published in this newspaper on February 26 pointed out, the special provision of Rule 24 of the Registration of Electors Rules, 1960 enables ’cut and paste’ from the existing rolls to the new situation, thus ensuring that the process of revision of the electoral rolls (with January 1, 2008 as the qualifying date) can be completed in time.

It turns out that such a course will not be anything new. In 1973-74, Rule 24 was used in Uttar Pradesh, India’s most populous State, and Orissa under comparable circumstances – and in a pre-computerised age, when all the hard work had to be manually done. The delimitation order for both States came in December 1973 and the Commission ensured, quite remarkably, that the electoral rolls for the newly delimited constituencies were ready in time for the electoral process to begin in January 1974. With the process going like clockwork, Assembly elections were held in both States in February and the results declared so that the target dates in March could be adhered to.

While the first factor is an enabling provision, the second is a mandate.

The 2002 ruling by a five-judge bench of the Supreme Court of India came on an Article 143 reference by the President of India in the context of the premature dissolution of the Gujarat Assembly on the advice of the Chief Minister, and delay in holding fresh elections.

The key aspect of the Supreme Court decision applicable to the present situation in Karnataka is that, under Article 324, which makes the superintendence, direction and control of the preparation of the electoral roll and conduct of elections to the Assembly "the exclusive domain" of the Election Commission, “it is the duty of the…Commission to hold free and fair elections at the earliest…no efforts should be spared by the…Commission to hold timely elections…and it would be the duty and responsibility of all concerned to render all assistance, cooperation and aid to the…Commission for holding free and fair elections.”

“Free and fair election,” the Supreme Court held emphatically in its 2002 ruling, “is the sine qua non of democracy…The Election Commissioner is a high constitutional authority charged with the duty of ensuring free and fair elections and the purity of electoral process. To effectuate the constitutional objective and purpose it is to draw upon all incidental and ancillary powers. Six months’ period applicable to elections held on expiry of the prescribed term would be imperatively applicable to elections held after pre-mature dissolution. This of course would be subject to such rare exceptional cases occasioned on account of facts situation (like acts of God) which make holding of elections impossible. But [a] man made situation intended to defer [the] holding of elections should be sternly dealt with and should not normally be a ground for deferring elections beyond six months period, starting point of which would be the date of dissolution…Any man-made attempt to obstruct free and fair election is [the] antithesis to democratic norms and should be overcome by garnering resources from the intended sources and by holding the elections within the six months’ period.”

What this means in simple English is that Karnataka’s administration under President’s Rule has no choice but to gear up and deliver.

Many dead in Sri Lanka bus attack

The bus bore the full force of the blast Enlarge Image

At least 13 people are believed to have died in a bomb attack on a civilian bus in northern Sri Lanka, the army says.

They say that the bomb went off near the town of Anuradhapura.

A large military parade was earlier held under tight security in Sri Lanka's capital, Colombo, to mark the 60th anniversary of independence.

President Mahinda Rajapaksa told the parade the military were inflicting "unprecedented" defeats in their campaign against the Tamil Tigers.

Security forces had been placed on high alert after a weekend of violence.

At least 11 people were killed in a suicide attack at Colombo's main railway station on Sunday.

And on Saturday, 18 people died in another bus blast in the central town of Dambulla.

Both were blamed by the government on the Tamil Tigers rebels, though the rebels have denied involvement.

Attack fears

News of Monday's attack near Anuradhapura - which officials say killed at least five soldiers - came just after President Rajapaksa addressed a military parade in Colombo 60 years after it gained independence.

Health officials say that at least 16 people injured in the blast are being treated at Anuradhapura hospital.

The authorities have blamed Tamil Tiger rebels for that attack and another bomb blast in the south of the country which killed a soldier and injured five others.

The BBC's Roland Buerk in Colombo says that Monday's parade was a show of strength by Sri Lanka's armed forces - once again, officially at war with the Tamil Tigers.

Violence has escalated recenty in Sri Lanka (Pic: Athula Bandara)

"Our security forces are today achieving victories against terrorism unprecedented in history. Terrorism is receiving an unprecedented defeat," he said.

"In less than two years we have liberated the large Eastern Province that was under the clutches of the terrorists and confined them to two districts, only."

The president said that "the defeat of the most ruthless terrorists of the world in Sri Lanka is also a victory of the developed world".

"We are also fully committed to carry on this battle while safeguarding human rights. This is the reality," he said.

"In short, two years ago, no one believed that terrorists could be defeated. But, during the last two years we made it a reality in our motherland."

The Tigers have marked independence day by once again saying they will fight on for a separate state for the Tamil minority in the north and east.

"This is not a day of independence nor is it a day of celebration for our people," rebel spokesman B Nadesan said.

"The Sri Lankan government are still continuing its ethnic cleansing and mass killings among the Tamil people."

Sea fears

Ranks of soldiers, sailors and airmen were drawn up on grounds overlooking the Indian Ocean for Monday's parade.

Tanks and trucks carrying multi-barrelled rocket launchers rumbled past. Heavy guns fired a salute sending smoke drifting out over the blue water, our correspondent says.

Mr Rajapaksa said terrorism and poverty were holding Sri Lanka back

Much of the centre of Colombo was been sealed off by military checkpoints.

Thousands of police and troops were deployed on the streets and the navy stepped up coastal patrols to combat a possible sea-borne attack.

Last month, the government pulled out of the 2002 ceasefire with the Tamil Tigers, arguing the rebels had used it to re-group and re-arm.

Since then, fighting has intensified on the frontlines that surround Tiger-held territory in the north.

Sri Lanka's army commander Lt-Gen Sarath Fonseka has said he now aims to defeat the rebels by the end of the year.

The Tamil Tigers have been fighting for an independent state in the north and east since 1983.

Suicide blast hits Pakistan bus

Several vehicles were damaged in the blast Enlarge Image

At least six people have died in a blast which hit a military bus in the Pakistani garrison city of Rawalpindi.

A military spokesman told the BBC that a suicide bomber riding a motorbike had rammed into the bus.

Over 20 people are reported to have been injured in the attack, which took place during the morning rush hour.

A series of suicide bomb attacks have hit Rawalpindi in the last year. In December opposition leader Benazir Bhutto was killed at a rally there.

Authorities have blamed Taleban militants based near the border with Afghanistan for the attacks.

'Gigantic blast'

Several vehicles were reported to have been badly damaged and the bus destroyed in Monday's blast, which went off near the army headquarters.

Officials said the military had cordoned off the area.

The blast took place early on Monday in a crowded market area.

One witness, Haji Shaukat Khan, told the AFP news agency that he heard a "gigantic explosion".

"There was a big ball of fire and smoke. Some pellets from the bomb hit the wall of my shop and I dived down, because I was injured in the arm in another blast that happened at this spot last year," he said.

Rawalpindi has seen several such attacks in the past six months, which have claimed dozens of lives.

Almost all have been blamed by the government on pro-Taleban militants operating out of Pakistan's tribal region of Waziristan.

Mirza boycotts Indian tournaments

Mirza is the most successful female Indian player ever

India's Sania Mirza says she will stop appearing in tennis competitions in her native country to avoid any further controversial incidents.

The 21-year-old has been at the centre of disputes involving her dress and disrespecting India's national flag.

"Every time I have played in India there has been some kind of problem," said world number 29 Mirza, who will miss next month's WTA Bangalore Open.

"At this moment, I have been advised by my manager not to play."

Mirza revealed she had come close to quitting the game after she was accused of disrespecting India's flag during the Hopman Cup in Australia last month.

She was pictured sitting with her feet resting on a table next to an Indian flag.

Although Mirza said the pose was accidental, a private citizen filed a complaint with a court in the central Indian city of Bhopal under the Prevention of Insult to the National Honour Act.

"I don't think it (withdrawing from the Bangalore Open) was an extreme reaction at all," Mirza told India's NDTV channel. "There is something or the other happening.

"It is not easy to be dealing with stuff like that. I felt great lows in the last few weeks."

Police in her hometown of Hyderabad [in southern India] have also registered a case against her for trespass for filming an advertisement in a mosque.

And Mirza has also angered sections of India's Muslims because of her "indecent" choice of dressing in shorts and sleeveless t-shirts on court.

12 killed in Colombo suicide attack

Government blames Tigers for Fort Railway Station explosion


The aftermath: Military personnel examining the site of the suicide attack at the Fort Railway Station in Colombo on Sunday.

COLOMBO: At least 12 civilians were killed and 100 injured as a suspected woman cadre of the LTTE blew herself up in the crowded Fort Railway Station here on Sunday afternoon.

The blast, coming on the eve of the 60th Independence Day, is the fourth in a series targeting civilians since the 2002 Cease Fire Agreement (CFA) between the government and the Tigers ended on January 16.
Vigil stepped up

The security forces have stepped up deployment and vigil in the national capital in the wake of the explosion and a sense of anxiety and fear has gripped the citizens. The government has blamed the Tigers for the blast and said these were acts of desperation to divert attention from the setbacks they received on the battlefield in recent days. The Liberation Tigers of Tamil Eelam (LTTE) has not responded to the allegation.

The police said the explosion was carried out by a female suicide-bomber who got down from a train in the station minutes before 2 p.m. The impact of the blast was so powerful that the main platform of the station was strewn with limbs of those killed.

According to the authorities in the Colombo National Hospital, where most of the injured are being treated, 10 persons are in critical condition.

Quoting ‘defence observers’, the Sri Lankan Defence Ministry said the recent attacks by the LTTE in the south bore “clear indications of the outfit’s desperation over the ignominious defeats” that it was encountering on the northern battlefronts. It also highlighted the need for national solidarity to bring an end to “this brutal terrorism,” a statement said.

In a report on the blast, the pro-LTTE TamilNet said: “The blast comes a day before Sri Lanka’s 60th Independence Day celebrations amid speculation of Colombo embarking on a full-fledged war on Vanni, stepping up aerial bombardment and artillery barrage.”

Earlier in the day, at least seven civilians were injured in a low intensity grenade explosion inside the Dehiwala Zoo on the outskirts of Colombo.

Seven persons, including two children, received minor injuries and were rushed to the general hospital at Kalubowila when a hand-grenade exploded inside the zoo at 10.35 a.m.

In the north, the security forces claimed to have killed scores of Tiger cadres.

Xinhua, PTI report:

An exhibition organised by the government to mark the independence anniversary has been postponed for three days .

However, other celebrations, including the parade, would go on.

6 killed in hotel building collapse

Manas Dasgupta

Rescue operations in progress in Ahmedabad; death toll could go up

— Photo: AP

To the rescue: Fire brigade personnel rescue a victim from the rubble of a collapsed building in Ahmedabad on Sunday.

AHMEDABAD: Six persons were killed and 14 injured, seven of them seriously, when a hotel building at Kalupur, just opposite the Ahmedabad’s main railway station, collapsed on Sunday morning.

Rescue operations are on and the Ahmedabad Municipal Corporation authorities apprehend that the death toll could go up.

While the hotel owner is reportedly absconding, knowledgeable sources said a couple of hotel staff on duty on Saturday night were missing and could possibly be under the debris.

Sniffer dogs have been pressed into service. The authorities fear that the chances of rescuing those trapped are remote.

The basement plus three-storey building, in which Hotel Shakun held three floors and the basement housed a Bank of India branch, was constructed in 1985.

Ahmedabad Municipal Commissioner I.P. Gautam said faulty excavation in the adjacent plot caused serious damage to the foundation of the building. He said the hotel owner and the bank were cautioned about the state of the building just three days ago and asked to vacate it immediately. While the bank was in the process of shifting, the hotel owner reopened it only on Saturday night.

The government has declared Rs.1 lakh compensation to the kin of the deceased.

At the time of the collapse, there were about 22 people in the building, including the hotel staff.

A police complaint has been lodged against the hotel owner and the owner of the adjacent plot for negligence.

About 200 Ahmedabad fire brigade personnel and State disaster management officials launched rescue and relief operations with help from about 125 volunteers of the non-government organisations.

While two bodies were recovered on the spot, the injured were shifted to the nearby government civil and Shardaben hospitals, where the condition of the seven injured was stated to be critical.

At least two of the victims were believed to have from Jhalore and Udaipur in Rajasthan and one from Indore in Madhya Pradesh.

Speaker Ashok Bhatt, Minister of State for Home Amit Shah and Minister of State for Women’s Welfare Maya Kodnani supervised rescue operations. Health Minister Jaynarayan Vyas visited the injured at the civil and Shardaben hospitals.

Nuclear deal: India may face “isolation”

Pranab Mukherjee

KOLKATA: India might have to face isolation in the global community “and possibly isolation in sanctions too” if the country did not see the civilian nuclear deal with the United States through, Pranab Mukherjee, External Affairs Minister, said here on Sunday.

“After finalising the agreed draft text we will come back to the Left leaders and the United Progressive Alliance-Left Committee, discuss and then proceed,” as per the “political arrangements made with our Left supporters,” he added, referring to the India-specific safeguards agreement with the International Atomic Energy Agency (IAEA), crucial to operationalising the nuclear deal.

A PTI report quoted Mr. Mukherjee as saying that India and the IAEA were yet to find a common ground on the issue and discussions were still on.

Mr. Mukherjee was addressing the annual general meeting of the Calcutta Chamber of Commerce here.

NSG exemption

On the process of granting exemption to India by the Nuclear Suppliers Group, Mr. Mukherjee said: “after the clearances there will come amendments to the NSG guidelines to facilitate nuclear trade that will open us up; then we can go to various countries including the United States, Russia and France.”

Mr. Mukherjee said the arguments being made against the deal were reminiscent of those made against computers and automation in the 1970s and the 1980s.

“All problems on the energy front will be resolved” through talks with those opposed to the deal, he said.

Energy needs

“We cannot depend upon coal reserves alone for our energy security. In view of environmental concerns, we must think of future generations,” he said, adding that the country’s energy needs would increase if it were to race ahead to realise the projected growth.

Once problems on the energy front were resolved there would not be any problem in achieving the projected sustainable growth rate of 10 to 11 per cent, given the fundamental strengths of the domestic economy.

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