Sunday, June 24, 2012

My two cents...

This article is written at a time when I am taking loans in rupees and paying in dollars. It just pains me so much that because of the govt's short sightedness I need to spend more of my currency for mere survival. Coming directly to the point, the issue of depreciating rupee is of concern not only to me but to most of fellow country men. There have been economic advisory meetings, there has been interviews with Standard and Poor's representatives, RBI governor, our own 'Mum'mohan singh and Pranab Mukherjee. There have been discussions about policy paralysis with respect to current world economic scenario as well as in essential service sectors like Retail and Aviation. With all due respect to all those economic experts whose thoughts would be of much value, I really feel they miss the whole picture here. Let's look at the scenario.

The bulk of our foreign exchange comes from export of software and other IT enabled services.And a major chunk of the reserves go in buying oil from the international market for our needs. The consumption of oil and related products by India is only increasing and that too exponentially. When our consumption increase obviously our foreign exchange reserves are going to drain out. Considering the Eurozone crisis and Barack Obama's tilt towards discouraging outsourcing of jobs from America it is too much for the IT and ITeS sectors to compensate for the outflow of cash.

Atleast Dr. Singh has accepted the fact that amendments need to be made from inside and not in external policies. A one off loosening of law against the Vodafone acqusition tax issue is neither going to solve the problem nor going to bring back enormous investors confidence on India. It seems the decision making machinery runs on the time frame of coalition politics and not on economic implications. Having a coalition partner like TMC is like having a prosthetic leg that is full of infections. Of course its gonna lift you for the time being while forming the government but is definitely going to kill you in the long run. The announcement of FDI in retail and the later withdrawal coupled with the bad timing of the vodafone decision are standing examples. If you have decided on an issue, you shouldn't go back on it due to coalition pressures.

Next comes the aviation sector. If the AI-IA merger is anything to go by, IAS officers aren't necessarily great managers or CEOs in today's market. The lesser it is talked about the better. Combined with promotion of poor business  models in new green field airport projects and revenue curtailing taxation from all departments it is only bleeding the airlines of the little foreign exchange they have. Kingfisher is already packing all its suitcases to leave. To sum up the plight of this sector, 'The govt hasn't understood the industry and the industry hasn't understood the market'.

Now these things will take a long time to clean up and therefore the revenue stream will continue to be plugged in terms of forex. Coming to the most critical part, spending of forex reserves by oil companies is never gonna reduce. If this is the biggest hole in the tank the only way to keep the tank full is by plugging the hole and not by trying to add temporary hose pipes. All the decisions taken now are like hose pipes with limited input. The only solution to this is for us to reduce the dependance on oil. How long are we going to continue importing oil from whatever the rates the OPEC countries sell? We have to face the problem and fight it head on. Instead of spending so much on subsidies the govt can start with investing in future energy research. We just can't wait for the westerners to develop each and every technology that we need and expect them to give it for free. We have the need now and we need to do it now. Diesel and petrol based public transportation system must slowly be phased and replaced with hybrid and other clean energy based systems. Hybrid and electric vehicle technology must be publicised and its importance explained at every possible stage. Investment in renewable energy must be increased exponentially and for god's sake be given to private sector and not public sector.

There will be lobbies against the aforementioned points from different sectors.  To start with, most political parties will be against FDI in retail and the big auto industry will be against the shift towards renewable energy when Ashok Leyland, Daimler, Navistar, Mahindra, Tata etc have just recently invested hell a lot of money here. The solution is to work with them, and give incentives like a promise of  minimum market atleast by the govt to buy the new technology that had come up with.

 After all these scams and licking of coalition boots, this is the only way out. Attending G20 meets and heading ASEAN, BRICS and lobbying for a permanent seat in Security Council is just going to bring reputation and not respect and results. For the latter to happen, the govt needs to be stern and innovative in its policies and decisions and all the way.

Friday, January 27, 2012

Retirement plans for the Big 3 and an Insurance Scheme to Indian cricket

I start writing this article as India enters into the 5th day of the Adelaide(an achievement by itself). Throughout the England and Australian tours, the stalwarts of Indian batting have been ruthlessly asked questions both on and off the field. With around 37,00o test runs between them, people might say all three in their own way have the right to play the Adelaide test and I wouldn't question that. But this cannot continue forever. And if all three are going to retire from Test cricket in 6 months time, its nothing less than a nightmare for Indian cricket.

The talks of seniors mentoring the junior players and helping in smooth transition is rubbish to say the least. Virat Kohli is the only junior batsman on tour to have played with the seniors. Giving small tips in the nets during practice is fine but when will people like Rohit Sharma, Rahane or for that matter any other fringe batsman get used to it or gain experience? It just so happens that the highest run getter, the second highest run getter and the master of second innings rescue are in the same team and at similar stages of cricket life. It means that if all leave at the same time(which is a very good possibility) there will be a huge gap left. It means one of them has to sacrifice himself for the common good of the team. It means the game comes first and then the individual.

Even after this series if none of them retire, its a plague. If the three like playing cricket and still have some left in them, this is their last chance. Retire from int'l cricket one by one. Spend the next one year in the domestic circuit. Play the Ranji, Duleep and Irani trophy. Play matches with the budding cricketers and share your experiences and knowledge there. Teach them in building partnerships and innings while playing along with them. Give them a sense of security that 'the place up there' is where I come from and let me help you now reach there. Spend time in their dressing room. Show them the spirit and hunger. This is the place you learnt everything. Give back something to the alma mater, i.e the domestic circuit. This will go a long way in instilling confidence amongst the youngsters as well as they will get to know a lot before entering the circuit. This is the only way I see a smooth transition of the team in the next couple of years. The best retirement plan that the three can get and the best insurance that team India can get.

And this is the last and best chance to do it. 2 years of home test cricket. No better chance. the scenario is atleast one must retire immediately after this series and atleast one must stay for the next one and a half years. It is in the best interests of Team India that they are doing it. I would like to finish with one last word to the readers. Don't fight on who should retire first. They know better.