Many corporate have signed MoU with various state governments and departments. Both signing parties know that there are huge security problem and there is huge uncertainty as well when these projects will be completed. But everyone was smiling and is smiling.

These two parties know that they cannot exploit the opportunities coming from these mineral rich regions with mending the law and some times misusing. This is happening everywhere from Chhattisgarh to Jharkhand to Orissa to Bengal. Government machineries and private resources are coming together to have a slice of the opportunity with help these so called ideologues named Maoists.

Government machinery and companies are threatening the common man living there and grabbing the lands for mines and for that purpose they paying some bribe to these Maoists as well. They are collecting these monies in the name of protecting the tribal only to displace them to some other places by misguiding or threatening or bribing. These care takers of tribal and big CSR boasting corporate and so called people’s governments have come together by keeping all the differences on sideline to loot these areas.

I am not against development in these areas. I do support development. But the way these trio is trying loot people is wrong. Anyhow you are promoting unethical practices.

It is not that Maoists want development in these areas but this an strategy to make money as well as turning new blood against government by saying that it is the government which is displacing and they are to protect them but they cannot as they cannot fight the military. So getting new member for their new mass murders. But what government is getting? A bad name in books of tribal, just a bad name.

The corporate are willingly paying to corrupt government officials and Maoists to run their business and to kill some innocent tribal or force them commit suicide. Instead of making them aware about what changes will come to their life if a industrial plant is put there, they are just eliminating these people for smooth drive. And government is supporting and strengthening these by providing machinery.

These big corporate should stop these unethical practices otherwise they have to pay today or tomorrow.

Insurance and investment are two different things and both these cannot be mixed up because no such hybrid product can offer benefits to the buyers. ULIPs are mixture of the insurance and investment products. Basically it is an investment product bundled with an insurance feature.

The annual premium paid by the buyers of these ULIPs is minimum Rs.10000-12000. Only 2-5% of this premium goes for insurance purpose and rest amount is divided into investment portion and charges and agent commissions. On an average near about 80-85% of all the premiums paid by the buyers till maturity goes to the equity market or some portion goes to debt market depending on the option opted by the buyers.

This investment by the insurance companies is more than the investment done by the mutual fund industry in indianequity market that is why SEBI so worried about these insurance companies. So many times SEBI has said that ULIPs should come under its preview but neither government nor IRDA have lent their ears. So SEBI decided to go unilaterally.

Insurance companies are selling aggressively these products and agents are more than happy by selling these ULIPs. But end customer is not benefiting from these said customer beneficiary products. Because these products are being pushed on the face of customers by miss representation of facts and figures. There so many strings attached with these products that finally go against the buyer. And IDRA seems to be protecting insurance companies interest instead of customers.

SEBI is also worried that since it has scrapped the entry loads from the mutual funds, the sales of mutual funds has gone down and all those agents working as mutual fund distributors either have become insurance agents or have stopped selling mutual funds. Because earlier they were earning some money from entry loads as well as trails.

There should be some norms so that these insurance companies can come under more stringent scrutiny because in long term they will be deciding the market movements and SEBI does not that any part of market or cartel could be able to decide the market movements. So it is taking steps to make market safer.

There will be respite to inflationary pressures in late May or early June. Rabi crop has been good this year and has started reaching Indian market. So we can expect that inflation will moderate in coming weeks. But the biggest headache is that there have been huge price rise in pulses and milk prices.

This is critical because India is not a big producer of pulses and there have been no improvement in production of pulses. Indian economy is witnessing low production of pulses for long time and this situation has turn out to be big worry and we cannot expect pulse prices to come down early. Because there may be some artificial price rises and some traders may be hoarding expecting to prices go up. But with in 6-7 months we can see some respite from high pulse prices. Consumers have to be ready that the prices will not be at those old ages. Market will come out with a new equilibrium price depending on market dynamics and those prices will be higher than earlier ones.

Main problem is with prices of milk produces. There has been no fall in milk production in India even though Indian economy has witnessed huge price rises in milk produces. This is because of rising inflation. Indian economy has seen prices rise in each and every article. There is no excess or artificial demand for milk produces. There will be likely no correction milk prices in future and if there is some respite to prices then that will not be insignificant enough because prices of every thing has increased despite Indian economy witnessing a recession. We cannot expect prices of all other commodities to fall sharply because as the Indian and world economy recovers from economic shocks and growth accelerates demand for commodities will be higher. So milk prices will not witness any significant price correction.

Other food items will see huge price correction in coming weeks with arrival of new crop. The demand and supply imbalance will be checked. But we have to make our mind that higher prices compared to those old normal prices will become new normal prices. This happens with every growing economy and none can escape from this.

We are seeing some ease in food prices but this euphoria seems to be non-sustaining. And we expect one more round of petroleum price hike in near future and hike interest rates. This will fuel the overall inflation. Interest hike is intended to bring inflation down but the simultaneous hike in petroleum price will neutralize this move and overall inflation will find its way.

From April 1, Euro-IV Norm will be implemented in India and this will come with a price and that is price hike in petroleum products. This put pressure on every section on economy from food items to non-food items. And result will be an increase in inflation figure. To curb this inflation RBI will again take some steps, as there is no fiscal policy option left to govt. That will be nothing but increase in some rates. This move will slow down the economic recovery.

If the situation is handled properly this will reverse the economic recovery. For this purpose, there is need for both policy measures fiscal as well as monetary. If possible govt. can postpone the petroleum price hike for a quarter, it will be good for the country.

There are certain reasons. First of all is inflation, second is check on credit quality, third is normalization of key policy rates and forth is to protect economy from overheating.

• RBI is worried because of high inflation. There is no other way to contain this high inflation. Because there is no fiscal exercise which can tam the inflation because there is lack of supply of food items. So RBI was forced to take such step. It does not seem that inflation will come down any time early future.
• There is very healthy growth in credit and RBI is worried about the quality of lending because any patch of bad lending will put economy in problem.
• RBI adopted for low-key rate policy because of economic slowdown but now the IIP growth is robust and there is no sign of any problem in industrial growth. So it seems to be right time.
• Indian economy is growing beyond ones expectation. It is good but RBI is cautious about the economic growth. It does not want to get the economy overheat.

There is only one instrument to care of all these four issues. Because CRR is not a long term measure while repo and reverse repo rate measure in long term and more effective to check the mentioned issues. But this will hurt economy because inflation in demand caused but supply caused problem. CRR would have been better because we will see another round of CRR hike and retail lending rate hike.

As expected, the central bank of India has started tightening the monetary policy to tam the inflationary pressure on economy. This month or next the general lend rates are going to increase. And this will not be good for the reviving economy; which has started show its strength.

We have seen increase in petroleum products price and expect some more such hike in current future specially in gas and kerosene price. Milk and other food items are showing upward price movements. These hikes and movements are now increasing the inflationary pressure in non-food articles as well. This is anyhow not good for the overall economic growth.

We do need to take care of inflation but by what route is always tricky. The realty sector and long durable sector has just started reviving the demand and it pick season is in offing. At this juncture RBI has increases the borrowing rate. This will hurt the demand in these sectors. It will quite difficult for the companies to increase their top line. This is a negative incentive for corporate borrowers as they may delay their corporate borrowings. This will hurt the employment generation rate in economy. At this juncture of revival, a good growth in employment generation in needed to increase the overall economic confidence.

Instead of such monetary activities it would be better govt. bring some fiscal changes in its fiscal policy to tam the inflation. It is widespread knowledge to everyone that this inflation is because the food items. There is problem in food supply and because of that it is hurting the economy. Such monetary policy changes do help to tam food items inflation but it is useful only when there is short-term supply problem.

Our food shortage problem is not a short-term problem. It is a long-term one and govt. has been ignoring this since early 2000s. There is no significant improvement from supply in food articles and production has somehow stagnated but the demand for food articles is increasing because of population growth and movement of food preferences from lower to higher end. And our production growth seem is not such it can support such population and life style change. Also there is problem with supply chain system. In maximum part country whether it is non functional or efficiency level is about 70% only. This supply chain lag also is adding to our problems with the price of food items.

Govt. has applied those old methods to bring down the food inflation while the whole dynamics of economy has witnessed a sea change. If govt. tries to get the stocks from hoarders it will only fail, as there is such problem of hoarding by merchant in huge capacity as it was in 70s and 80s. So govt. should try to fix this problem with proper planning and execution to improve the agricultural infrastructures and production, so that we do not have such problems in future. Sign for food problems were given to the govt. in early 2003 itself but keep ignoring. And this is remains the same we will face even worse situation than this one.

This will bring about a permanent change in the world as Industrialization brought in Europe. India and China in Asia, Brazil in Latin America and South Africa in Africa are new representative this new world and they will decide the new world order. It may not seem so significant as of now but the signs are there.

India, Brazil and South Africa are the economies, which are basking on their domestic demand and being led by domestic consumption. China may be a concern as it is hugely dependent on export and has restricted economy and seems not to have fair and free policies in place. This may be a cause of concern but the overall economy of these three continents are very much favor arrival of new world order. And even if China fails to meet the world’s expectation, a new world order is sure to be written.

We can cheer up that the prosperity will finally reach to these neglected parts of the world sooner not later. The emergence of new power will enforce the overall world economic activities and will bring down the risk of world economic failures, because the economic growth basket will diversify over a period of time.

This decade and the next decade will be a game changer. It is not possible that US and Europe will go behind the certain. No, they will not. But the international politics will be more democratic. And we will not see more Iraq and Afghanistan. This is beauty of this new coming world.

They just need a bunch of people who can dance on their tune and meet their short-term goals by increasing the top line and bottom line. They are not that much interested in the long-term values being added to the organization and future leaders. This is not only with CEOs but also the board. Many times board suspects the ability of their CEO for not meeting top line and bottom line targets. The length of top line and bottom line often measures one’s capability.

Iment is the way to achieve things in ethical ways. The tendency of accusing some for any problem and not having confidence in the manager is the problem.

It is tough time and everyone is worried. So every company is firing their people saying that they are trying to cut the cost. But is it the right strategy to cut the cost? Is not helping the recession getting deep in the nerves of economy? Why not to cut the salary, bonus and dividend instead of lay off? Why not to recruit more people with lower salary for continued expansion? Are not we running after a goose from another planet to decrease the effect of recession?