The consequences of BLUE!

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Though this has nothing to do with the core issue (as Mushharaf would like to say it) the blog aims to discuss, I felt this post deserves a place here since it is a matter of public interest. So here we go, the consequences of BLUE!

1. A legislation has been introduced in the Parliament banning Zayed Khan from acting in front of an audience of more than 10 people

2. No one will call BLUE their favourite colour anymore

3. The men in BLUE (Team India) have decided to blame their bad performance on the film

4. All examiners will enforce negative marking for students using BLUE Ink

5. All ocean organisms will be suing the producers for showing them in bad light

6. Levis has projected a major fall revenues due to a drop in the sales of BLUE denims

7. 5 groups of treasure hunters have set out on a hunt to find the 90 crore treasure that had sunk during the production of BLUE

And I'm sure the true extent of the damage will be will be felt for decades to come!

Congress sweeps, BJP weeps, Mayawati cries and the Left dies

My top 5 reasons for the UPA government coming back to power:

1. National Rural Employment Guarentee Scheme(NREGS)- Not my favorite and something I particularly don't support but then if you do intervene at that scale you're bound to better than your last performance

2. The Pay Comission: Who is the biggest employer in this nation? Yes it's the Government of India. If you give your employees a nice little pay rise then you're definitely headed for a good run.

3. Minimum Support Price: Agriculture has taken a huge shot in the arm with the MSP all crops going up significantly over the past 5 years. Says alot about the 60% of our poppulation earning a significantly greater income than what they did 5 years back

4. Reservation: Like it or not, a lot of casteism is practiced at the rural level today. There are colonies that are formed based on caste and people are forced to not send their kids to school just because they belong to a certain class. It's the wrong type of empowerment but empowerment none the less. Especially when the OBCs form 51% of the poppulation, you will earn quite a few brownie points.

5. The youth leaders: On my left- Rahul Gandhi, Sachin Pilot, Milind Deora, Priya Dutt, Jindal and on my right- Sushma Swaraj and Arun Jaitley? What the opposition lacks is the charisma of their youth leaders and in a true sense they lack real statesmen (No one minus Jaswant Singh, Arun Jaitley and L.K. Advani).

What the Congress needs to focus on if it wants to come back to power in the next General Elections:

1. Education, Education and more Education.
2. Uplift India's textile sector and bring more jobs to the villages.
3. Invest in the future, don't just hand out money.

-Akhil Sharma

Slumdog: How proud should we be?

When Gandhi won a record number of Oscars we had lots to be proud about. But remember Fahrenheit 911 and its awesome Bush-bashing. Imagine if George Bush was to stake claim to the movie’s success! Now that would have been a funny sight but then something as strange did happen today. The congress in a press conference claimed ‘Conducive UPA rule led to Oscar wins’ (Read the full news article here). Now that’s a brave statement to make and perhaps not many in the government have seen what the movie’s about. It’s a movie about a slum dweller who wins a handsome sum of money at the popular show ‘Who Wants to Be a Millionaire?’ not because he went to school or because he was educated, but because he related to the questions in a completely different way. Answers that he was reminded of because of seeing his mother die during the Hindu-Muslim riots, homeless children referred to each other as the three musketeers, his beggar friend being blinded so he could collect more alms, a 100 dollar tip he got after swindling an American tourist, a revolver he saw being used for a murder and a thriving prostitution racket.

So what makes a movie so good? The fact that it depicts real life drama or the fact that it’s a surreal story of a slum dweller turned millionaire. And guess what, the congress government claims to have provided a ‘Conducive UPA rule’ that helped win the Oscar. The government has still not quelled communal tensions and India still boasts of the largest slum in Asia. Children are still regularly exploited and maimed children are a common sight on the roads of several metropolises. Women are often sold to brothels and suffer a lifetime of oppression and disease. Slumdog did so well not just because of the brilliant background score but because of the story it told, a story which we all know is true and probably unfolds somewhere in India even as you read this small piece. Hats off to the UPA for staking claim to Slumdog’s success.

But to be fair to the politicians, it’s not just them but our society in general that can be blamed for going overboard celebrating the success of Slumdog. There will be a real and lasting change in politics only if there is a change in our society. I would just like to close by saying that its alright celebrating the success of Indian cinema, but the ulterior motive of cinema isn’t to win awards, albeit the Oscars. Such cinema aims to depict the real world and bring forward the hidden malice that has infected our society and maybe it's our duty to work to remove it.

OPEC’s Problem: Why it has failed to increase the price of Crude

OPEC or the Organization of Petroleum Exporting Countries was a cartel formed in the early 1960s. Though only 35.6% of the international crude production is by its 12 member states, yet it is extremely powerful in determining price. When it comes to free trade, forming Cartels is forbidden, but then when you think of it even the EU or signatories of the NAFTA and even Asia and Africa form cartels at WTO negotiations. So not wasting too much time talking about the right to OPEC’s existence lets come down to the point. The fact is that OPEC is the supreme power when it comes to determining global crude prices but the only question is why can’t this supreme power do anything about the crude prices atleast for the time being?

Remember when the international oil price hovered at USD 147 a barrel, the Libyan Oil Minister who was also the OPEC General Secretary – Abdallah Salem el-Badri said that oil prices might even rise to USD 200. In effect he raped the already strained consumer with oil prices seeing their biggest, strongest and most prolonged rally in history. At that time Saudi was the only sensible OPEC member that agreed to increase output. But maybe it’s Karma or maybe it’s just pure economics that’s hit back hard and literally made the OPEC powerless.

There are some key terms that need to be understood before you go through the Paradox:

1. OPEC countries and their dependence on the export of oil:
Its biggest member is Saudi Arabia which receives 90% of export earnings and 75% of its Budget revenues directly from oil while the smallest in terms of output is Algeria which depends on oil exports for 95% of its export earnings. The point is that OPEC countries depend heavily on the export of crude oil and sharp dips in revenue collections from the export of oil can hurt their economy really badly (By either a fall in price or volumes).

2. OPEC’s quota system:
OPEC sets quotas which all 12 member states need to voluntarily abide to. The percentage increase and decrease in the production of oil is generally reflected uniformly amongst Quotas of all member states. An increase in quota leads to reducing prices while a reduction leads to increased oil prices.

3. US Crude inventories:
After OPEC the only other force strong enough in terms of determining international crude prices is the US crude inventories report. These weekly reports determine how much of crude inventory does the biggest consumer of crude have. The greater the inventory the lesser is the perceived demand for crude and hence the crude prices fall and ofcourse vice verse is also true.

OPEC’s Problem:

Enter the Perfect Market: When the OPEC countries reduce their output by say x%, they need the price to go up by more than x% to maintain their already scarce revenues from the export of oil. As of now the forecast for economic growth is so grim that the average price rise after an OPEC decision to cut production isn’t even as much as x% and thus atleast some of the OPEC countries go beyond their quotas. This is quickly reflected in the weekly US crude inventory details. This quickly causes a correction in the price of crude bringing it back to supply-demand equilibrium. The result is inevitable, a long drawn bout of low crude prices and there won’t be much the OPEC could possibly do as of now. There is baseline below which OPEC can’t reduce its output atleast at the current crude prices and maybe we’re already at that point.

It’s sad that to keep the growth engines of the world going, we need to be held ransom by the OPEC. But then maybe there is a force stronger than the OPEC and ofcourse that is the force of economics.

NREG an investment or a waste?

The government has started the National Rural Employment Guarantee scheme. I'd like to point out a couple of instances where i saw what was really happening:

• Near Pilani in a village called Garinda, people were paid to dig pits and then fill them back again
  
  
• On the way to Delhi, in Haryana we stopped somewhere and saw people sweeping the highway. When i asked them why they were doing this they said it was a part of the NREG scheme.
  

Theses are figures that the NREG website claims:

Employment provided to households:	3.51 Crore
Persondays [in Crore]:
Total:	138.76
SCs:	42.95 [30.96%]
STs:	33.42 [24.08%]
Women:	67.68 [48.77%]
Others:	62.39 [44.96%]
Total works taken up:	20.68 Lakhs.
Works completed:	7.38 Lakhs.
Works in progress:	13.3 Lakhs.

The NREG was alloted 16000 crores to implement the plan and promised greater funds if and when required. Firstly, the productivity of the scheme is under question and I won't spend much time arguing that. But i do question how much of it actually trickles down to the bottom of the pyramid. There were places where people were promised 100 bucks a day and other places where they were paid only INR 7 a day.

Now looking at it from a different angle, talking about teaching the fellow how to fish rather than giving him the fish, India figures the lowest in terms of public spending in Education. Is it time to learn fishing rather than distribute the fish?

I am quoting a news report:

'In spite of a booming economy, India's public spending on higher education per student is the lowest among developing and developed countries.

Though the Central Government has announced an expected 150 percent increase in central spending on higher education in 2007-08 (at Rs. 6,354 crore over Rs. 2,550.50 crore this year), the fact remains that India will continue to lag behind, compared to its asian counterparts.'

(Please note the difference wrt the NREG budget allotment. Education spending lags by 10000 crore or almost 150% of the educational budget)

'At the moment, public spending on higher education per student in India stands at US$ 400 (Rs. 18,000) and this is expected to improve to around US$ 1,000 (Rs. 45,000)'

it goes on to say:

'Even among the BRIC (Brazil, Russia, India and China) countries, India is at the bottom of the pile. While China, Russia and Brazil spend US$ 2,728, US$ 1,024 and US$ 3,986 respectively on higher education per student, another developing country Malayasia's expenditure under the same head is quite high at US$ 11,790.'

Is it time to pay teachers more to get better people to join the profession and spend on a better tomorrow rather than just a better today?

Time to rethink spending or are we stuck in a time warp election after election?