India to continue with rate hike

India will keep unwinding economic stimulus deployed during the financial crisis and continue raising interest rates despite uncertainty linked to euro zone’s debt woes, its finance minister said on on Friday. Pranab Mukherjee said that a deepening debt crisis in Europe could hit India’s and other emerging economies’ exports and growth, but such a risk was not stopping India from gradually reversing loose fiscal and monetary policies.

Asked whether uncertainty about the impact of Europe’s debt crisis on the global economy was a reason to hold off with further interest rate increases despite last quarter’s buoyant growth, Mukherjee said, “No, we won’t pause them.”

RBI raised rates in March and April by 25 basis points and signalled more hikes would follow, when it last met for a regular quarterly policy review in April. However, recent market volatility and worries that Europe’s efforts to rein in debt will sap global growth, cast doubt on the scope of monetary tightening by major central banks.

Such worries also gave rise to suggestions that major emerging markets economies, such as China, India, Brazil and Russia, should help sustain global recovery by delaying the exit from loose policies put in place during the global downturn.

Mukherjee, however, said India would continue to consolidate its finances and underscored the contrast between the relative fiscal health of emerging economies and debt-laden euro zone members. “You need fiscal prudence and in the developing countries, we are doing so.”

Union budget 2009-10 and Environment

Conservation of the big cats continues to remain a priority for the government, which has doubled the budgetary allocation for the Tiger Project to Rs 184 crore in 2009-10 from Rs 72 crore in 2008-09.
Tiger Project is an autonomous body entrusted with the task to protect and conserve the royal predators whose number has dwindled to 1,411 across the country as per the latest estimate.

Besides, the government has alloted Rs 562 crore for cleaning and conserving rivers and lakes in the country. The amount for the purpose last year was Rs 335 crore.

"Budgetary allocation under National River and Lake Conservation Plans to be Rs 562 crore in 2009-10 from Rs 335 crore in 2008-09," Union Finance Minister Pranab Mukherjee said in his Budget speech in the Lok Sabha.

The overall funding for the Ministry of Environment and Forests has been increased from Rs 1,707 crore in 2008-09 to Rs 2,129 crore in 2009-10.

Mr. Mukherjee said the government has already approved the notification for setting up the Ganga River Basin Authority for comprehensive management of the basin. The setting up of the authority aims to help replace the current piecemeal efforts to clean up the Ganga with an integrated approach that sees the river as an ecological entity.

The Finance Minister announced a special one-time grant of Rs 100 crore to the Dehra Dun-based Indian Council of Forestry Research and Education in recognition of its excellence in the field of research, education and extension.

He also proposed an allocation of Rs 15 crore each for the Botanical Survey of India, Geological Survey of India and Geological Survey of India for research and study in their respective fields.

The budgetary allocation for forestry and wildlife departments has been increased from Rs 804.45 crore to Rs 921 crore while funding under the head of prevention and control of pollution has been enhanced from Rs 477.67 crore to Rs 709.23 crore.

Is America dream over????

America has much dependent on Indian techies for its IT industry. With recession many Banks became bankrupt and many companies asked US government bail out plan. When President Obama took over charge of reins of America, he has promised American people that he will restore jobs to Americans. With thousands of jobs being cut by US companies almost daily over the past few months, there have been widespread apprehensions that these positions could go to low-cost foreign workers or might be outsourced to places like India. To revive economy Obama has introduced $ 787 billion stimulus bill to revive economy. The US Congress has barred firms receiving government bailout from hiring Indians and other foreign workers through the skilled worker visa (H1-B) programme, if they are replacing American workers. A dozen banks which are getting over USD 150 billion as the bailout money have sought visas for over 21,800 foreign workers in past six years to replace sacked Americans. These banks have announced at least one lakh job cuts in the recent monthsIndians account for a majority of those with H1-B visa, issued to non-immigrant skilled workers for up to six years. Restricting hiring of H1-B visa holders forms part of American Recovery and Reinvestment Act, (the stimulus bill), that was passed by the Congress. The government data for 2008 shows that about 5.7 lakh Indians were issued H1-B and other non-immigrant visas. About two years ago, the US had cut down the H1-B visa limit to 65,000, from 1,95,000 a year previouslyCongress' move would certainly impact hiring of H1-B visa holders, thus affecting in a big way the engagement of Indian techies in the US, but might not affect outsourcing of jobs to places like India. It is believed that the provision in stimulus bill to restrict hiring of H1-B visa holders would deprive the US of the best global talent which comes in the form of highly trained and talented people.

There is wide spread job cuts in IT,BPO, Gems, Textiles, Real estate, infrastructure industry in India and many companies have freezed recruitments and cutting the salaries to cut the expenditure. The service industry depends on IT and infrastructure also badly affected. America is biggest consumer in the world and every country economy is linked with American economy. I feel countries should reduce dependency on USA and there should be reasonable salary structures in private sector, so that the companies also can pay salaries to employees with out job cuts.

Because of high salary structures in private industry, many companies are unable to pay employees salaries during recession hence pink slips. It is also believed that with high salaries there is wide gap in the society, where lot of money flow into the system and raising the prices of real estate, commodities etc. Prime Minister Dr Manmohan sigh has appealed to the private industry to have reasonable salary structure to the private sector employees. President Obama is appealing the private banks and Wall Street companies to have a reasonable salary structure.

With emerging economy, 7-8% annual growth, India is a land of opportunities. The honey in USA is over, many Indians are returning to India.

Obama and Ethical Standards

America has elected Afro-American, Christian- Muslim, white-black Barck Obam for CHANGE of America. There are lot of hope people of America and world put on Obama for change. His recent decision on etical standards should be appreciable when some his cabinet nominee are defaulters of taxes and etical investigation. As two more of his cabinet nominees bit the dust over tax troubles, threatening to derail his agenda of change, President Barack Obama admitted in a series of TV interviews he screwed up. As former Senate majority leader Tom Daschle, Obama's choice for health and human services secretary and Nancy Killefer, his pick for federal spending watchdog, both pulled out of contention Tuesday because of personal tax problems. Earlier, New Mexico Governor Bill Richardson withdrew as Obama's nominee for commerce secretary because of an ethical investigation in the state. Timothy Geithner won Senate confirmation as treasury secretary despite $35,000 in tax arrears he had belatedly paid.

Obama said 'I campaigned on changing Washington and bottom-up politics. And I don't want to send a message to the American people that there are two sets of standards: one for powerful people and one for ordinary folks who are working every day and paying their taxes. And I'm here on television saying I screwed up and that's part of the era of responsibility, is not never making mistakes; it's owning up to them and trying to make sure you never repeat them and that's what we intend to do.' The series of embarrassing disclosures involving four of his choices for powerful positions, Obama is frank enough to admit the mistake and pulled out of contest. This shows how people in political seats maintain ethical standards and set example to others.

This is reverse in India where tainted people will be given key political posts and not maintaining ethical standards. Many people with criminal records are elected to the parliament and assemblies and many elected representatives are not furnishing the proper assets to the election commission before filing the nomination papers and many involve in tax evasion. Indian political leaders should learn from the American new president ethical standards.

Obama may impose $500,000 cap on top executives' pay packets

The Obama administration is expected to impose a cap of $500,000 for top executives at companies that receive large amounts of bailout money, a media report said on Wednesday, citing people familiar with the plan.Executives would also be prohibited from receiving any bonuses above their base pay, except for normal stock dividends, the New York Times said.The new rules would be far tougher than any restrictions imposed during the Bush administration, and they could force executives to accept deep reductions in their current pay, the paper said.They come amid rising public fury about huge pay packages for executives at financial companies being propped up by federal tax dollars, the Times noted.Executives at companies that have already received money from the Treasury Department would not have to make any changes, it said, adding that analysts and administration officials are bracing for a huge wave of new losses, largely because of the deepening recession, and many firms that have already received federal money may well be coming back.Crucial details, the paper said, remained unclear, including whether the restrictions would apply to all companies that receive money under the so-called Troubled Assets Relief Programme or whether they would apply only to the "exceptional" firms that were being rescued from collapse.Under the Treasury's $700 billion rescue programme, most companies that have received money so far have been considered "healthy" rather than on the brink of collapse, the paper said.But five of the biggest companies to get help -- Citigroup, Bank of America, the American International Group, General Motors and Chrysler -- were all facing acute problems. And top executives at those companies made far more than $500,000 in recent years.
Link MSN

3,000 priests seek divine intervention to end financial crisis

This small village in Gujarat's Mehsana district is witnessing a religious ritual in which 3,000 priests have begun chanting hymns to invoke divine intervention to tackle the global financial crisis.
The priests have been drawn from states like Uttar Pradesh, Bihar and Rajasthan apart from different parts of Gujarat to Madhavnagar locality of Ramosana. The ritual, which began 15 days back, has the priests sitting around 109 sacrificial fires and chanting hymns to appease goddess Meldi, urging her to restore prosperity and world peace.
Surprisingly, none of the residents of Mehsana, about 75 km from Ahmedabad, know much about the financial crisis the world is facing. But the Koti Chandi Mahayagna Seva Samiti (KCMSS), which is organising the ritual, claims it is the first ever yagna (sacrificial ritual) to be performed at such a large scale that would continue for two years at an approximate cost of Rs.1.5 billion (Rs.150 crore).
'The yagna which has entered its 15th day on Saturday will continue uninterruptedly for two years. The first phase of the yagna will end after 10 million Chandi Path slokas (hymns) in praise of goddess Meldi have been uttered invoking divine blessings,' said Dahyabhai Patel, convener and trustee of KCMSS
Said Shari Ratnesh Jha, a priest invited to perform the rites: 'It is unprecedented. I have never came across such big havans before.'
'It is indeed historical as this sort of vast yagnas are found only in religious texts. Only Hindu emperors of yore performed such yagnas,' said Kailasnath Chandralekh, another priest.
Pradyuman Shashtri, the head priest from Mehsana, says this is the greatest moment of his life and that the ritual is sure to have positive results.
'I am sure Goddess Meldi will fulfil the desires of the people.'

Link Yahoo

'Google may scrap Yahoo deal if US sues'

Google Inc, owner of the most popular web-search engine, may back out of a partnership with rival Yahoo Inc if the US justice department sues to block it, Stifel Nicolaus & Co's Blair Levin said. A suit would give antitrust officials access to most of the businesses' records, which companies typically want to avoid, the analyst said on Friday. The department hired Sanford Litvack, its chief under president Jimmy Carter, to give advice, signalling the agency may plan to challenge the deal. "Generally speaking, the government wins these things," said Levin, who once served as the federal communications commission's chief of staff. "When the justice department walks into court to block something, when the antitrust division comes in, they have a lot of history on their side." Lawmakers have questioned whether the deal, which will let Yahoo display Google ads next to some of its search results, will give the companies too much control over the internet. The two already handle more than 80% of web searches in the US. Google, based in Mountain View, California, rose $19.59, or 4.7%, to $433.75 in Nasdaq Stock Market trading at 4 pm New York time. The stock has dropped 37% this year. Yahoo rose 85 cents, or 4.8%, to $18.55. Litvack is an outsider and a "recognized all-star," and his appointment may signal the agency plans to block the deal, said Levin, who is based in Washington. The justice department is still examining the deal, said spokeswoman Gina Talamona, who declined to comment further. The department hasn't confirmed Litvack's appointment. Yahoo confirmed this week that the lawyer had been hired. Microsoft Corp and the 400-member Association of National Advertisers trade group have said a deal between the No 1 and No 2 online advertisers may hamper competition and drive up prices for marketing. Microsoft is a distant third in internet searches, handling about 9% in the US. Google and Yahoo agreed on deal in June, and said at time they wouldn't implement it for 3 and half months to give the justice department time for review. Google chief executive officer Eric Schmidt had said the partnership would probably start in late September or early October. "We're committed to move ahead," Yahoo executive vice president Hilary Schneider said. "We're confident we can get them comfortable in the time period we've talked about." The two companies have maintained that they don't need approval from the justice department to proceed with the deal.

Link Bloomberg