Friday, 27 June 2008


Steven Lee Myers

The New York Times, June 27, 2008

WASHINGTON — North Korea’s declaration of its nuclear activities is a triumph of the sort of diplomacy — complicated, plodding, often frustrating — that President Bush and his aides once eschewed as American weakness.

In more than two years of negotiations, the man who once declared North Korea part of an “axis of evil” with Iran and Iraq, angrily vowing to confront, not negotiate with, its despotic leader, in fact demonstrated a flexibility that his critics at home and abroad once considered impossible.

That is why Mr. Bush is likely to receive only grudging credit, if any, for the accomplishment, which could turn out to be the last significant diplomatic breakthrough of his presidency.

North Korea’s declaration — and the administration’s quid pro quo lifting of some sanctions — faced criticism from conservatives who attacked it as too little and from liberals who said it came too late.

“The regime’s nuclear declaration is the latest reminder that, despite Mr. Bush’s once bellicose rhetoric, engaging our enemies can pay dividends,” Senator John Kerry of Massachusetts, whom Mr. Bush defeated in the 2004 presidential election, said in a statement after the declaration on Thursday.

“Historians will long wonder,” he continued, “why this administration did not directly engage North Korea before Pyongyang gathered enough material for several nuclear weapons, tested a nuclear device and the missiles to deliver them.”

(...) [artículo aquí]

Thursday, 26 June 2008


Norimitsu Onishi and Helene Cooper

International Herald Tribune, June 26, 2008

TOKYO: North Korea submitted a long-delayed declaration of its nuclear program on Thursday, and the Bush administration immediately responded by saying it would remove the country it once described as part of the "axis of evil" from the State Department's list of state sponsors of terrorism.

The declaration was believed to provide a partial, though important, view of North Korea's nuclear capability, and it marked a significant step forward in a multinational effort to end the country's drive to build nuclear weapons.

China, which has hosted the six-nation talks on the North's nuclear program, said Thursday afternoon that the North would abide by the Thursday deadline to submit its declaration. But an hour later, South Korea, another participant, said the North had already handed the declaration to China.

Whatever the source of the confusion, the White House announced shortly afterward that it would remove North Korea from the terrorism list and thus make it eligible for aid and assistance, a goal long sought by the cash-starved country.

The North was scheduled to follow up on Friday by blowing up a cooling tower at its Yongbyon reactor, about 95 kilometers, or 60 miles, north of Pyongyang.

Pyongyang has invited officials and television networks from the five nations negotiating with the North on its nuclear program - the United States, China, Japan, South Korea and Russia - to witness the demolition of the tower. But the destruction, which is expected to be broadcast live, will be largely symbolic, since the reactor was disabled late last year under U.S. supervision.

(...) [artículo aquí]

Wednesday, 25 June 2008


Chidanand Rajghatta

The Times of India, June 25, 2008

India, with the world's largest population of poor people living on less than a dollar a day, also paradoxically created millionaires at the fastest pace in the world in 2007 even though the world grew such "high net worth individuals (HNWIs)" at the slowest pace in four years.

Growing them at a blistering pace of 22.7 per cent, India added another 23,000 more millionaires in 2007 to its 2006 tally of 100,000 millionaires measured in dollars, according to an annual Merrill Lynch Cap Gemini report that weighs such financial information for its wealth and asset management purposes.

In contrast, developmental agencies put the number of subsistence level Indians living on less than a dollar a day at 350 million and those living on less than $ 2 a day at 700 million. In other words, for every millionaire, India has about 7000 impoverished people.

While India's HNWI population growth of 22.7 per cent in 2007 exceeded China's 20.3 per cent and its own 2006 gains of 20.5 in 2006, it was still way below its giant neighbour in absolute number of millionaires. China counted nearly 500,000 HNWIs.

Overall, the numbers of millionaires (not counting home values in their assets) in the world grew at 9.4 per cent and crossed the 10 million mark for the first time. The United States, despite its economic woes, led the pack of Richie Rich's with more than three million millionaires, i.e., one in every three millionaires in the world lives in America.

The combined wealth of the globe's millionaires grew to nearly $41 trillion last year, which means their average wealth was more than $4 million, the highest it's ever been.

(...) [artículo aquí]

Tuesday, 24 June 2008


Carlotta Gall

The New York Times, June 24, 2008

ISLAMABAD, Pakistan — Pakistan is in a leaderless drift four months after elections, according to Western diplomats and military officials, Pakistani politicians and Afghan officials who are increasingly worried that no one is really in charge.

The sense of drift is the subject of almost every columnist in the English-language press in Pakistan, and anxiety over the lack of leadership and the weakness of the civilian government now infuses conversations with analysts, diplomats and Pakistani government officials.

The problem is most acute, they say, when it comes to dealing with militants in the tribal areas that have become home to the Taliban and Al Qaeda.

Although the political parties and the military all seek a breather from the suicide bombings and nascent insurgency that have roiled Pakistan in recent years, there are fundamental disagreements over the problem of militancy that they have not begun to address, Pakistani politicians and Western diplomats say.

The confusion is allowing the militants to consolidate their sanctuaries while spreading their tentacles all along the border area, military officials and diplomats warn. It has also complicated policy for the Bush administration, which leaned heavily on one man, President Pervez Musharraf, to streamline its antiterrorism efforts in Pakistan.

(...) [artículo aquí]

Monday, 23 June 2008


V. Ramakrishnan

Reuters India, June 23, 2008

PUNE, India (Reuters) - The Reserve Bank of India (RBI) signalled on Monday it would tighten monetary policy further to tackle double-digit inflation but cooled bond market expectations that an aggressive interest rate rise was imminent.

Headline inflation surprised markets on Friday with a jump to an annual rate of 11.05 percent in early June from 8.75 percent at the end of May, and the finance ministry said at the weekend it expected the central bank to tighten policy.

The benchmark 10-year bond yield jumped 13 basis points to its highest in nearly seven years at 8.76 percent on Monday on nervousness that an immediate increase in interest rates was on the cards, after a surprise lending rate rise in early June.

But economists said that while RBI chief Yaga Venugopal Reddy's comments on Monday still indicated tighter policy to come, it may not happen quite as quickly as the market had anticipated.

(...) [artículo aquí]

Sunday, 22 June 2008


Somini Sengupta

The New York Times, June 22, 2008

JALANDHAR, India — With the right technology and policies, India could help feed the world. Instead, it can barely feed itself.

India’s supply of arable land is second only to that of the United States, its economy is one of the fastest growing in the world, and its industrial innovation is legendary. But when it comes to agriculture, its output lags far behind potential. For some staples, India must turn to already stretched international markets, exacerbating a global food crisis. It was not supposed to be this way.

Forty years ago, a giant development effort known as the Green Revolution drove hunger from an India synonymous with famine and want. Now, after a decade of neglect, this country is growing faster than its ability to produce more rice and wheat.

The problem has grown so dire that Prime Minister Manmohan Singh has called for a Second Green Revolution “so that the specter of food shortages is banished from the horizon once again.” And while Mr. Singh worries about feeding the poor, India’s growing affluent population demands not only more food but also a greater variety.

(...) [artículo aquí]

Friday, 20 June 2008


Keith Bradsher

International Herald Tribune, June 20, 2008

HONG KONG: Faced with increasingly severe fuel shortages and the prospect of power failures during the summer air-conditioning season, the Chinese government unexpectedly announced sharp increases late Thursday night in regulated prices for gasoline, diesel and electricity.

The increases are the latest sign of how China's integration into the global marketplace has limited the flexibility of the country's leaders in responding to economic crises. The government has come under intense pressure recently from both environmentalists and other governments to ease up on its fuel subsidies, which are blamed for distorting global markets, encouraging greater consumption and pushing oil prices higher for other nations.

The government, like many around the world, has struggled to keep up those subsidies as oil prices have spiked in recent months. Finally, despite fears that it will spur inflation, the government raised the retail price of diesel by 18 percent, to the equivalent of $3.58 a gallon, and the price of gasoline by 16 percent, to $3.83 a gallon. Electricity tariffs and the price of jet fuel were also raised.

The higher prices could prompt businesses and people across China to use less fuel and electricity, potentially slowing China's voracious oil consumption as well as its steep rise in emissions of global warming gases. Following the news, world oil prices immediately dropped more than $4 per barrel.

(…) [artículo aquí]

Thursday, 19 June 2008


The Financial Express, June 20, 2008

India is likely to see the highest growth in foreign investments and become the world leader for investment in manufacturing, according to a survey by KPMG, which is a global network of professional firms providing business advice.

The study says that while 10% of the 300 multinationals surveyed expect to invest in India at present, around 18% want to invest in the country in the next five years. "It is the biggest gainer among BRIC (Brazil, Russia, India and China) countries," said KPMG India chief executive officer Russell Parera.

"A significant amount of investment in India in the next five years is expected from first-time investors," Parera said.

The survey was conducted in 15 countries. Corporate investment strategists were asked where they planned to invest in the next 12 months and five years. The results show a move away from investments in the United States, Japan, Singapore and the United Arab Emirates, and a big increase in flows towards the BRICs.

However, China is likely to lead the pack in investment intentions over the next five years, with around 24% of respondents planning an investment there. China was followed by the US (23%) and Russia (19%). India---fourth with 18%--- has emerged overall winner with the highest increase of 8%.

(...) [artículo aquí]


The Telegraph, June 19, 2008

The world's fund managers are pulling their money out of China and India at a record pace on mounting fears of inflation and are now more pessimistic about global equities than at any time in the past decade.

The latest survey of investors by Merrill Lynch shows that Europe has become the most unpopular region, while Britain is still trapped in the doldrums.

But the big surprise is the sudden change in view on the emerging powers of Asia, as overheating and spiralling oil costs spoil the boom.

"World growth is slowing and yet central banks might still have to tighten monetary policy, that is what is scaring people," said David Bowers, the organiser of the survey. The vast majority of fund managers think earnings forecasts have lost touch with reality.

The exodus from China reached fever pitch this month as investors slashed their net "weighting" position to -58, down from -14 in May. The Shanghai bourse had already fallen by almost half since October.

(...) [artículo aquí]


Willy Lam

China Brief (Jamestown), June 18, 2008

Apart from the Olympics, the Chinese Communist Party (CCP) leadership’s biggest challenge this year is to lay out a road map for “the next stage of reform.” The CCP will this December be marking with much fanfare the 30th anniversary of the start of the reform era, which was unveiled by late patriarch Deng Xiaoping soon after he had shoved aside the ultraconservative Maoist faction. As befits their carefully nurtured image as worthy successors of the Great Architect of Reform, President Hu Jintao and Premier Wen Jiabao are expected to unveil a substantial agenda for change that suits the requirements of the new century.

The mantra of “pushing forward with thought liberation” was sounded first by Hu in his Political Report to the 17th CCP Congress last November, and by Wen in his Government Work Report to the National People’s Congress in March. Yet Hu and Wen being cautious bureaucrats rather than trail-blazing visionaries, decided early this year to let provincial rising-stars such as Guangdong Party Secretary Wang Yang take the lead in propagating what was billed as “the third wave of thought liberation.” The first tide of liberalization refers to the 1980 campaign called “practice is the sole criterion of truth,” which laid into the Maoist doctrine that “whatever Chairman Mao said is correct.” The second crusade, which was launched during Deng’s celebrated "Southern journey" (nanxun), or tour of southern China in 1992, was about boosting productivity through the unfettered adoption of market mechanisms in the economy.

(...) [artículo aquí]

Tuesday, 17 June 2008


Keith Bradsher

The New York Times, June 18, 2008

HANOI — Canon is no longer building or expanding factories in China, but the company is doubling its work force at a printer factory outside Hanoi to 8,000. Nearby, Nissan is expanding a vehicle engineering center. Hanesbrands, the underwear company based in Winston-Salem, N.C., is setting up two new factories here, as is the Texhong Textile Group from Shanghai.

China remains the most popular destination for foreign industrial investment in the world, attracting almost $83 billion last year. But a growing number of multinational corporations are pursuing a strategy that companies and analysts call “China plus one,” establishing or expanding Asian bases outside China, particularly in Vietnam.

A long list of concerns about China is feeding the trend: inflation, shortages of workers and energy, a strengthening currency, changing government policies, even the possibility of widespread civil unrest someday. But most important, wages in China are rising close to 25 percent a year in many industries, in dollar terms, and China is no longer such a bargain.

(...) [artículo aquí]


Livemint, June 17, 2008

Following up their recent research on India, Goldman Sachs and Co. economists Jim O’Neill and Tushar Poddar have come up with a report on 10 things the country needs to do to achieve a per capita GDP of at least $20,000 (Rs8.58 lakh today) by 2050 (from less than $1,000 now). That target looks difficult when seen in the light of the investment bank’s annual report on Growth Environment Scores, a study where a score from 1 to 10 is assigned to 13 variables that define an economy’s productivity and growth sustainability. In this report, India scores below the other Bric nations (Brazil, Russia, China) and is ranked 110 out of 181 countries studied. However, Poddar and O’Neill say that by undertaking required reforms, India can still reach its 2050 target by increasing “its growth potential by as much as 2.8% per annum”.

Edited excerpts:
1. Improve governance.
2. Raise educational achievement. According to our basic indicators, a vast number of India’s young people receive no (or only the most basic) education. A major effort to boost basic education is needed.
3. At the other end of the spectrum, India should also have a more defined plan to raise the number and the quality of top universities.
4. Control inflation. We think a formal adoption of inflation targeting would be a very sensible move....
5. Introduce a credible fiscal policy. We also believe that India should introduce a more credible medium-term plan for fiscal policy. Targeting low and stable inflation is not easy if fiscal policy is poorly maintained.
6. Liberalize financial markets.
7. Increase trade with neighbours. In terms of international trade, India continues to be much less “open” than many of its other large emerging nation colleagues, especially China... We would recommend that India target a major increase in trade with China, Pakistan and Bangladesh.
8. Increase agricultural productivity.
9. Improve infrastructure.
10. Improve environmental quality. Achieving greater energy efficiencies and boosting the cleanliness of energy and water usage would increase the likelihood of a sustainable stronger growth path for India.

(...) [artículo aquí] [informe de GS, Global Economics Paper, No. 169, aquí, PDF]

Sunday, 15 June 2008


The Economic Times, June 16, 2008

The sudden spurt in the inflation rate these past few weeks, mainly on account of global oil prices, is causing analysts to review their GDP forecast for India.

Until a few months ago the expectation was that, even after a marginal slowdown, India would still manage to clock a GDP growth of 8% and that the inflation rate would settle down to below 7% by the year end.

Now there is some apprehension among analysts that the average inflation rate for the year may stay above 8% and growth may slip to below 8%. The official position of the government and the RBI, however, remains unchanged. Growth forecast is now being reviewed as no one had anticipated that the oil prices would shoot up the way they did last fortnight.

The latest inflation rate measured by the Wholesale Price Index has touched a seven-year high of 8.75% and this is likely to inch closer to 10% in the coming weeks as the recent domestic oil price hike by the government gets factored into the Wholesale Price Index. The general upward movement in the bank lending rates, following the repo rate cut, is also adding to the incipient pessimism about growth in 2008-09.

(...) [artículo aquí]

Saturday, 14 June 2008


Elisabeth Rosenthal

The New York Times, June 14, 2008

China has clearly overtaken the United States as the world’s leading emitter of carbon dioxide, the main heat-trapping gas, a new study has found, its emissions increasing 8 percent in 2007. The Chinese increase accounted for two-thirds of the growth in the year’s global greenhouse gas emissions, the study found.

The report, released Friday by the Netherlands Environmental Assessment Agency, found that in 2007 China’s emissions were 14 percent higher than those of the United States. In the previous year’s annual study, the researchers found for the first time that China had become the world’s leading emitter, with carbon emissions 7 percent higher by volume than the United States in 2006.

Many experts had been skeptical of the earlier study, whose results were less clear-cut than those released Friday. The International Energy Agency had continued to say only that China was projected to overtake the United States by the end of 2007. Now there is little doubt.

“The difference had grown to a 14 percent difference, and that’s indeed quite large,” said Jos Olivier, a senior scientist at the Dutch agency. “It’s now so large that it’s quite a robust conclusion.”

China’s emissions are most likely to continue growing substantially for years to come because they are tied to the country’s strong economic growth and its particular mix of industry and power sources, the researchers said.

(...) [artículo aquí]

Friday, 13 June 2008


Media and entertainment, private education, infrastructure, and renewable energy companies are poised to prosper as India's middle class expands

William Nobrega

Business Week, June 13, 2008

Welcome to the "Next Wave." We are living in an unprecedented point in human history when the new consumer, technology, infrastructure, and environments begin to converge and create one of the world's greatest eras of economic growth and technological innovation.

During the next 20 years, the Next Wave will create more new consumers than the previous millennium did. Investments in infrastructure will exceed the total investments in the reconstruction of post-war Europe. Technology and the Internet will be the great enabler, facilitating the development of multiple centers of innovation across a wide range of geographies. And the environment will be a critical thread within this new tapestry, as climate change and the need for resources push humankind to find new approaches to economic development and sustainable growth. Although China, Brazil, Russia, and other emerging markets will drive much of this, India stands at the forefront with its rapidly growing middle class, massive investments in infrastructure, a technology-based culture, and growing need for energy and other natural resources.

Many companies will benefit from the Next Wave, but some verticals will capture the lion's share of the growth and profits. Among the most significant of these "Next-Wave Verticals" are media and entertainment groups. They are gaining importance in India because of the country's growing middle class, improving literacy rates and increasingly organized retail sector driving demand for print, radio, and TV content. Improvements in infrastructure and advances in technology are also rapidly increasing media penetration in rural areas of the country where more than two-thirds of the population resides.

(…) [artículo aquí]


Edward Yong

The New York Times, June 13, 2008

BEIJING — Representatives of China and Taiwan agreed Friday to start weekend charter flights next month between the two sides, taking the first step toward establishing regular transportation links that could ease relations.

The representatives also agreed Thursday to establish permanent offices in each other’s capitals to help coordinate discussions about closer relations.

The offices could reduce the chances of misunderstanding if tensions were to arise over issues like military maneuvers.

The agreements came during negotiations over how to strengthen the economic relationship between China and Taiwan, which the government in Beijing regards as a renegade province. The meetings began Thursday and are taking place between so-called unofficial negotiating bodies. They are the highest-level talks between China and Taiwan since 1999.

Representing Taiwan is the Straits Exchange Foundation, which sent a 19-member delegation here.

The charter flights between China and Taiwan, a thriving democracy of 23 million people off the coast of Fujian Province, would allow more mainland tourists to visit Taiwan each year and promote business travel. Although Taiwan is the biggest investor in China and many Taiwanese businesspeople live on the mainland, there are no direct commercial flights. Charter flights are limited to four holiday periods a year, for a total of 324 annual flights.

President Ma Ying-jeou of Taiwan has said he would also like to begin regular commercial service by 2009.

(...) [artículo aquí]

Thursday, 12 June 2008


Andy Mukherjee

Bloomberg, June 12, 2008

The 8.1 percent, one-day slump in China's key stock index this week shows investors are shifting their gaze away from food prices -- which are stabilizing -- to other sources of inflation simmering below the surface.

The biggest drop in the equity market in 16 months came just as information leaked that a government report to be released today will show a bigger slowdown in the pace of consumer-price gains than expected by all but three of the 19 economists surveyed by Bloomberg News.

An annual inflation rate of 7.7 percent in May, 100 basis points lower than the 12-year high recorded in February, is “certainly good news,” says Michael Pettis, a Peking University finance professor. Yet, “it shouldn't give too much comfort to the pro-growth camp in China,” Pettis says. The good news on the inflation front was drowned by the hawkish monetary tightening that was announced over the weekend when the People's Bank of China ordered banks to set aside a further 1 percent of their deposits as reserves, seeking to limit a liquidity buildup, one of the biggest sources of future inflation in the world's fourth-largest economy.

“The liquidity threat remains copious,” says Dwyfor Evans, a macro strategist at State Street Global Markets in Hong Kong.

According to media reports, the People's Bank of China added $75 billion to its foreign-exchange reserves in April, creating local money in the process. Some of those funds may get exported out of the economy by China Investment Corp., the sovereign wealth fund.

(...) [artículo aquí]

Wednesday, 11 June 2008


The Hindu, June 11, 2008

NEW DELHI: The World Bank has projected India’s GDP (gross domestic product) growth to slow further to seven per cent in 2008 on account of the tight monetary policy in place as a measure to rein in inflation leading to a consequent slowdown in demand for industrial goods.

In its report on ‘Global Development Finance’ released on Tuesday, the World Bank said: “GDP growth in India eased to a still strong 8.7 per cent in 2007, from 9.7 per cent in 2006, and is projected to slow further to 7 per cent in 2008.” The Bank attributed the moderation in the country’s economic growth to the “monetary tightening in 2007 [that] led to softening in domestic demand.”

The report pointed out that although the restrictive monetary policy measures prevented a further surge in the inflationary spiral, the resultant strengthening of the rupee proved detrimental to the exporting community. With the country’s industrial production decelerating to three per cent in April this year, the report noted that there were growing signs of the economy cooling down. However, thanks mainly to the large remittance flows and robust growth in wage rates, the industrial slowdown has not led to a fall in the rate of consumption, it said.

(...) [artículo aquí]


Madeleine K. Albright

International Herald Tribune, June 11, 2008

The Burmese government's criminally neglectful response to last month's cyclone, and the world's response to that response, illustrate three grim realities today: Totalitarian governments are alive and well; their neighbors are reluctant to pressure them to change; and the notion of national sovereignty as sacred is gaining ground, helped in no small part by the disastrous results of the American invasion of Iraq.

Indeed, many of the world's necessary interventions in the decade before the invasion - in places like Haiti and the Balkans - would seem impossible in today's climate.

The first and most obvious reality is the survival of totalitarian government in an age of global communications and democratic progress.

Myanmar's military junta employs the same set of tools used by the likes of Stalin to crush dissent and monitor the lives of citizens.

The needs of the victims of Cyclone Nargis mean nothing to a regime focused solely on preserving its own authority.

(...) [artículo aquí]



10 June 2008

Beijing, China – China’s average ecological footprint has doubled since the 1960s and now demands more than two times what the country’s ecosystems can sustainably supply, a new report released today finds.

The Report on Ecological Footprint in China, jointly commissioned by China Council for International Cooperation on Environment and Development (CCICED) and WWF, is the first comprehensive report about China’s footprint. It gives an overview of the factors that determine the country’s growing ecological deficit, beginning in mid-1970s, and shows innovative paths for China to achieve its development goals in a sustainable way that ensures the future generations have the natural resources they need to prosper.

According to the report, China now uses 15 per cent of the world’s total biological capacity. The analysis in this report finds that people of China have an ecological footprint of 1.6 global hectares per person in 2003 (the last year for which figures are available), which means each individual needs 1.6 hectares of biologically productive land to support their lifestyle demands. The figure is still lower than the world average of 2.2 global hectares per person, ranking China the 69th of the 147 nations measured that year. But it nonetheless presents challenges, considering China’s large population and the robust economic development.

(...) [comunicado aquí] [informe aquí, PDF, 2,1M]

Tuesday, 10 June 2008


The Economic Times, June 10, 2008

NEW DELHI: Recent reports of Chinese incursions and Beijing's claims over chunks of Indian territory notwithstanding, Defence Minister A K Antony on Tuesday said India will follow a non-confrontationist approach towards its neighbours.

"We (India) are not ignoring (these incidents). To a maximum extent, we will try to avoid confrontation," Antony told reporters here after inaugurating a conference of top commanders of the Integrated Defence Staff drawn from the three wings of the armed forces.

Over 150 incursions into Indian territory by China's Peoples Liberation Army (PLA) troops have been reported in the last one year, apart from claims over Indian territory, including the recent controversy over Finger Area in north Sikkim, which was assumed settled till now.

During the recent visit of External Affairs Minister Pranab Mukherjee to Beijing, the Chinese reportedly tried to corner India by raising the Finger Area issue. "We are in the process of finding solutions to the long standing disputes with China, and the process is continuing," Antony said replying to a query.

(...) [artículo aquí]

Sunday, 8 June 2008


Kalpana Kochhar and Charles Kramer

The Financial Express, June 9, 2008

That India is a rising economic superpower is well known. India’s GDP growth has been one of the fastest in the world, and in purchasing power terms it now ranks fourth in the world—above five of the G7 countries. Per-capita income rose by 4.7% per annum on average between 1995/96 and 2005/06, accompanied by a drop in the poverty rate of over 8 percentage points between 1993/94 and 2004/05. The middle class is burgeoning and the ranks of Indian billionaires is rising, seemingly by the day. Indian companies continue with their global economic ambitions, racking up a string of high profile acquisitions—Corus and Jaguar recently, and MTN possibly on the horizon. And more and more foreign companies see India as an attractive place to invest, with inward direct investment by those companies reaching a record $5.7 billion in February 2008. From a broader macroeconomic viewpoint, growth has been driven by rising saving and investment, both up some 10 percentage points of GDP during this decade.

But, India’s international financial stature remains moderate by comparison. While the stock market is thriving, India’s government bond market is illiquid and its corporate bond market is moribund at under 7% of GDP, a fraction of the size of the markets in Korea or China. With the banking system dominated by public sector banks, which control over 70% of banking assets, and entry by foreign banks limited, India has few world-class financial institutions with global reach and scale. Moreover, regulation hamstrings the ability of institutional investors such as pension funds and insurance companies to participate in domestic financial markets, and thereby help those markets develop. For example, derivatives markets, the “oil” in the engine of global finance, remain underdeveloped, and increasingly trade offshore—in fact, trading in contracts like over-the-counter interest rate and currency products and in Nifty futures has migrated to the friendlier regulatory environment of Singapore.

(...) [artículo aquí]

Friday, 6 June 2008


Keith Bradsher

The New York Times, June 6, 2008

After rising steeply for many years, emissions of three important pollutants began to decline last year, China’s Ministry of Environmental Protection announced Thursday as part of an annual report.

Total levels of pollution in China’s lakes, rivers and coastal waters still rose, however, as more pollutants continued to flow into them, the ministry said. And the air in many Chinese cities remained severely polluted.

The ministry said that emissions of sulfur dioxide, mainly from coal-fired power plants and the primary cause of acid rain, declined 4.66 percent last year. The Chinese government has pursued a stringent program that requires power plants to cleanse most of the sulfur dioxide from their flue gases before they are released into the atmosphere. Environmentalists had expected the program to show success.

Emissions of organic pollutants into waterways, as measured by tests of chemical oxygen demand, declined by 3.14 percent last year, the ministry said. Industries reduced their discharges of solid waste into the air and water by 8.1 percent.

Ma Jun, a prominent environmentalist in Beijing, said that while the calculations may be accurate, the overall levels of pollutants are still far higher than the environment can tolerate, particularly in China’s waters.

“We need to have the understanding this is just the turning point in pollution discharges, this isn’t the turning point in the environment,” he said.

(...) [artículo aquí]

Thursday, 5 June 2008


The Economic Times, 5 Jun, 2008

MUMBAI: With soaring crude oil prices, the time has come for the Indian power sector to explore substitutes. If India continues to grow at an average rate of 8% for the next 10 years, power demands may rise from the present 120 gigawatt (GW) to 315-335 GW by 2017, 100 GW higher than current estimates, states a sixmonth long study ‘Powering India: The Road to 2017’.

The McKinsey & Company’s Electric Power and Natural Gas Practice study shows a radical approach to increase power capacity.
India is gradually progressing towards a service-led economy from an agrarian economy , says the study. Supply and production have increased but demand has doubled. According to the study, the demand can only be met through a five to 10-fold rise in power production. This means investments in the power sector will increase over $600 billion (Rs 24 lakh crore) in the next 10 years. Consumer demand across rural and urban sectors is growing at 14% over the next 10 years, whereas India’s GDP growth is just 8% a year. The second reason is the government’s plan to provide electricity to everyone by 2012.

(...) [artículo aquí]

Wednesday, 4 June 2008


William Pesek

Bloomberg, June 4, 2008

Depending on whom you ask, China is either on the verge of a big slowdown or an inflation surge. Some worry Asia's second-biggest economy faces both risks.

China's situation suggests Asia is on the cusp of its worst couple of years since 1997. From Seoul to Jakarta and from Beijing to New Delhi, officials are grappling with a rapidly worsening inflation picture.

It would be nice if there was less concern about the phenomenon and more action to address it. Asia may be nearing the point of no return -- one where the region's so-called economic miracle goes off the rails anew.

Asia isn't about to revisit the darkest days of 1997 and 1998. It was then that speculators tested central banks' resolve to defend currencies. Thailand's devaluation in July 1997 set in motion a crisis that suspended the Asian miracle. It prompted investors to leave Asia and sent contagion around the globe.

A decade later, Asia faces the flipside of that experience. The turmoil of the 1990s was about deflation and recession; the situation today involves overheating. Central banks may already be remiss in a different way than they were during the last crisis: They are falling behind the inflation curve.

“Inflation really has become THE issue,” says Richard Grainger, a director at Barclays Capital in Hong Kong.

(...) [artículo aquí]

Tuesday, 3 June 2008


With no magic wand in hand, countries must handle rising prices with energy efficiency and alternative sources

Dilip Hiro

YaleGlobal, June 3, 2008

LONDON: With the price of oil rocketing to the unprecedented level of $130 a barrel, there is a talk of another oil shock. Unfortunately, unlike past instances, this one is unlikely to subside, and may indeed keep intensifying. The only way out is for Western nations, the gluttonous users of petroleum, to cut their consumption and emulate Japan in its consistent drive for energy efficiency and alternate sources.

The present explosion in oil prices is the fourth of its kind, but different from the previous ones in 1973-74, 1980 and 1990-91. The earlier oil shocks were caused by interruption of supplies from the Middle East, respectively due to the war between the Arabs and Israel, the Iranian revolution, and Iraq’s invasion and occupation of Kuwait. Once peace returned, the new order became established or the invader was expelled, supplies returned to normal.

(...) [artículo aquí]


Chia-Peck Wong and Charles Penty

Bloomberg, June 3, 2008

Banco Bilbao Vizcaya Argentaria SA, Spain's second-biggest bank, will double its stakes in units of China's state-owned Citic Group for 800 million euros ($1.24 billion) to increase revenue from the fastest-growing major economy.

BBVA will raise its holding in China Citic Bank Corp. to 10.1 percent from 5 percent, the Bilbao-based bank said in a filing to regulators. The Spanish bank has an option to increase that to 15 percent within two years, it said. BBVA's holding in Citic International Financial Holdings Ltd., also controlled by Citic Group, is being boosted to about 30 percent from 15 percent.

China's economy has expanded by more than 10 percent for nine straight quarters, driving consumer and corporate demand for loans and other financial services. In contrast, economic growth is slowing in Spain, Mexico and the U.S., where BBVA gets 80 percent of its profit.

``It's good to see banks diversifying their business away from the slowing Spanish economy,'' said Marta Campello, an investment manager at Abante Asesores in Madrid. ``This is going to be good news for the bank.''

From Citic International's point of view, the Spanish bank's increased investment is ``positive,'' because the alliance adds products and clients, said Wong Kwok Wai, an analyst at BOC International Holdings Ltd.

BBVA will name three members to the board of Citic International and two to China Citic Bank, China's seventh- largest by assets, the Spanish company said.

(...) [artículo aquí]

Monday, 2 June 2008


Norimutsu Onishi

The New York Times, June 3, 2008

SHIBETSU, Japan — “If you build a home and move here, the land is yours free,” read a billboard on the side of a quiet two-lane highway that disappeared straight into the horizon here, under northern Japan’s big sky.

An orange hand atop the billboard pointed to a large, empty tract of flat land on which three new houses stood, surrounded by nothing.

Yellow stake signs dotted the land. Some displayed the name of a future settler, like a certain Inehara-san from Hyogo prefecture on lot B-9; others, only the details of a piece still up for grabs, including the 4,300 square feet on B-11.

Desperate to stanch a decline in population, this town and another in Hokkaido, the northernmost island in Japan, are trying to lure newcomers with free land. It was a back-to-the-future policy since Hokkaido was settled by Japanese drawn here by the promise of free land in the late 19th century, a time when Japan was growing and modernizing rapidly.

Since 1998, Hokkaido, like the rest of rural Japan, has been losing its residents to cities and old age. Significantly, just as Hokkaido’s earlier development resulted from Japan’s expansion, the decline in its population presaged the new era of a shrinking Japan, whose overall population started sliding in 2005.

(...) [artículo aquí]

Sunday, 1 June 2008


Helene Cooper

International Herald Tribune, June 1, 2008

An 18,000-page declaration submitted by North Korea to the United States is stirring debate about whether U.S. intelligence agencies previously overstated how much plutonium the Pyongyang government might have produced for its nuclear weapons program.

Bush administration officials have declined to comment on the declaration, which State Department officials say will take weeks to wade through, but they have indicated that North Korea is acknowledging it produced 37 kilograms of plutonium, or about 81 pounds.

That total would be more than the 30 kilograms that North Korea has previously acknowledged but somewhat less than the 40 kilograms to 50 kilograms that U.S. intelligence agencies had calculated it had produced. Estimates on how many nuclear bombs North Korea could wring from its plutonium program have ranged from 6 to 10.

No one in the administration is prepared to accept the documents at face value, a Bush administration official said, and some intelligence analysts are particularly wary of the numbers they have seen so far. The official said that State Department negotiators were continuing to push the North to be as forthcoming as possible.

(...) [artículo aquí]