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BW Businessworld

2G Implosion

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A seemingly innocuous right to information (RTI) application filed by advocate and RTI activist Vivek Garg seems to have caught two central pillars of the ruling United Progressive Alliance (UPA) government — finance minister Pranab Mukhejee and home minister P. Chidambaram — off guard. In response to the RTI application, the Prime Minister's office (PMO) released many documents including a confidential note sent by the finance ministry to the PMO, which suggested that Chidambaram, former finance minister, could have prevented the 2G scam had he opted for auctioning the spectrum. With the Opposition demanding Chidambaram's scalp and the Congress in disarray, uncertainty rules Delhi.

A seemingly innocuous right to information (RTI) application filed by advocate and RTI activist Vivek Garg seems to have caught two central pillars of the ruling United Progressive Alliance (UPA) government — finance minister Pranab Mukhejee and home minister P. Chidambaram — off guard. In response to the RTI application, the Prime Minister's office (PMO) released many documents including a confidential note sent by the finance ministry to the PMO, which suggested that Chidambaram, former finance minister, could have prevented the 2G scam had he opted for auctioning the spectrum. With the Opposition demanding Chidambaram's scalp and the Congress in disarray, uncertainty rules Delhi.

Give 'N' Take
It is tough to be both neighbours and enemies. If the latest developments from the Indo-Pak trade meet in New Delhi are anything to go by, then at least the business relations between the two south Asian countries are set to improve. During talks between Indian commerce minister Anand Sharma and Pakistan commerce and trade minister Makhdoom Mohammad Amin Fahim, both sides decided to increase bilateral trade from $2.7 billion to $7 billion by 2014. Plus, a liberalised visa regime will be introduced from November, especially for businessmen.

Billion-dollar War Chest
Pharmaceutical giant GlaxoSmithKline is readying for the long haul in India. According to its global CEO Andrew Witty, GSK has a war chest of $1-2 billion to support its expansion plans in India. "We can afford a deal worth $1-2 billion in the Indian pharmaceutical space. However, we are not in a hurry to close a deal at a higher valuation," he says.











LISTEN TO ME: US President Barack Obama (Bloomberg)

Free Speech
Giving advice is one of the easiest things to do. Last week, US President Barack Obama got the Europeans' goat when he said, "They (Europeans) are going through a financial crisis that is scaring the world, and they are trying to take responsible actions. But those actions have not been quite as quick as they need to be." Stung by this harsh language, German finance minister Wolfgang Schäuble responded in kind: "I don't think Europe's problems are America's only problems; it is always easier to give other people advice." Agreed.

Bitter Truth
Last week, home minister P. Chidambaram ruffled many a feather. Speaking at a function organised by the All India Management Association in New Delhi, he suggested that India should take a cue from Europe, where the rich have offered to be taxed more to save sinking economies, and impose higher taxes on rich people. "I know many people won't like this," the former finance minister said. Certain things are easier said than done.

Germany Finally Blinks
With belligerent Germany voting in favour of bailing out debt-ridden Greece, the looming sovereign debt crisis seems to have been averted, for now. Germany will contribute E211 billion to the E440-billon to European Financial Stability Facility.

Food For Thought
You have to spend more to keep your lunch box full. Food inflation has reached 9.13 per cent in the week ended 17 September. Last week, food inflation had declined to 8.84 per cent from 9.47 per cent in the previous week. Analysts say the reason for the latest uptick is the rise in prices of potatoes, pulses and poultry.












LANKAN TARGET: Linea plans to sell 1,000 cars

New Drive
The numbers may not be all that exciting, but Fiat India has started exporting its sedan Linea to Sri Lanka. Although the Sri Lankan market is quite small — 20,000 units a year — the company believes this is an important milestone in its international presence. In the first year, Fiat plans to capture 5 per cent of the Sri Lankan market. Next on Linea's international map are Bhutan and Australia — both right-hand drive countries. It already exports to Nepal and South Africa.

(This story was published in Businessworld Issue Dated 10-10-2011)