Today's Hot Stories - December 28, 2012
10 Headlines for Today
(1) Mulayam goes soft on Muslim quota
(2) CPM leader's rape remark against Mamata sparks row
(3) Travel chaos as deadly storm hits northeast US
(4) Carmakers offering heavy discounts even on newly launched cars to put sales on track
(5) IRDA chief differs with finance ministry over new post
(6) Craig Mundie to retire from Microsoft
(7) Australia thrash Sri Lanka to seal series
(8) India go down 4-5 in final against Pakistan
(9) Cricket: SA, Windies find glory in 2012
(10) Oscar-nominated composer Richard Rodney Bennett dies
5 Stories for Today
(1) Modi’s rise raises thorny succession issues the BJP will need to settle
(2) Japan voters back new PM cabinet, economy top priority
(3) Change of guard at Tata Group
(4) US consumer confidence falls on fiscal cliff fears
(5) Potential hike in diesel may effect investment in auto industry
(1) Modi’s rise raises thorny succession issues the BJP will need to settle
Narendra Modi didn't lack high-profile attendees at his swearing-in on Wednesday as Gujarat's fourth-time chief minister. BJP bigwigs including L K Advani and Nitin Gadkari were there. So were all NDA CMs, barring Bihar's Nitish Kumar. Also notably present were AIADMK's Jayalalithaa, MNS's Raj Thackeray, Shiv Sena's Uddhav Thackeray and INLD's Om Prakash Chautala. If this was Modi's way of showcasing a phalanx of possible backers for his national ambitions, he made his point. Only, the show of strength - in terms of exhibited BJP unity or the potential for a reconfigured NDA - doesn't stand closer scrutiny.
Notwithstanding the rousing welcome for him from party workers at the BJP headquarters in New Delhi yesterday, Modi's political ascendancy appears a big dilemma rather than reason to rejoice for the RSS-led sangh parivar. This explains the apparent reluctance so far of the BJP - which seems guided by Nagpur - to facilitate the catapult of its star vote-catcher and unapologetic spokesman of muscular nationalism to the national stage. Nor would scandal-hit party chief Gadkari - who's thought to have RSS backing - presume to downplay Modi's growing clout. Recently, he praised Madhya Pradesh CM Shivraj Singh Chouhan as a model of deve-lopment-oriented leadership at an event the BJP fetes as "Sushasan Diwas", or good governance day. Significantly, Modi had won Gujarat for a record third time on the development plank just a few days earlier.
Gadkari isn't the only leader with ambitions to counter Modi's. The BJP seems faction-ridden on the leadership issue in the post-Vajpayee-Advani era. If it does recognise Modi's claim to being first among equals at the national level on grounds of his performance, the NDA will most likely fracture. On one hand, Modi's inability to junk his Hindutva hawk image dents his national acceptability. On the other, he's paradoxically - and aggressively - been his own man in politics despite belonging to the sangh parivar, whose sectarian ideology is a waning influence in new, aspirational India.
The BJP on its part seems unable to function as an outfit that takes independent political decisions based on hard-nosed calculations, including when filling top posts. The way out of this conundrum is for it to turn itself into a modern outfit whose leaders - from party chief to prime ministerial nominee - are chosen via in-house elections. This will buttress its oft-made claim to being guided by democratic processes unlike the dynasty-driven Congress. It'll also help settle thorny succession questions creating disunity. With all eyes on 2014, the BJP needs to check internal disarray - and fast.
(2) Japan voters back new PM cabinet, economy top priority
More than half of Japanese voters support new Prime Minister Shinzo Abe's cabinet, media surveys published on Friday showed, with the country's stagnant economy topping the list of problems voters want the hawkish new leader to tackle.
Abe took office on Wednesday, after his conservative Liberal Democratic Party's (LDP) landslide election victory this month, promising to revive the world's third-biggest economy with bold monetary easing and big spending by the debt-laden government.
Support for Abe's cabinet, which is packed with allies who share his conservative views but leavened with some party rivals, ranged from 52 percent in a survey by the Mainichi newspaper to 65 percent in a poll by the Yomiuri newspaper.
Fixing the economy, now in its fourth recession since 2000, was voters' top priority. Forty-eight percent of voters in a survey by the Asahi newspaper put the economy as their first priority, compared with 11 percent who stressed security issues, which are also a key element of Abe's platform.
Abe, 58, wants to revise Japan's post-World War Two constitution limits on the military so Tokyo can play a bigger global security role, but only 32 percent of voters in the Asahi poll backed the move compared to 53 percent who opposed.
Voters were split over the LDP's post-Fukushima nuclear disaster energy policy, with 46 percent in favour of its plan to restart off-line nuclear reactors that are confirmed safe and 45 percent opposed, the Yomiuri said.
Abe, who quit abruptly in 2007 after a troubled year in office during which his early high support rates crumbled, is all too aware of the need to show results quickly ahead of a July election for parliament's powerful upper house.
The LDP and its smaller coalition partner won the two-thirds majority in the lower house that allows them to enact bills rejected by the upper chamber, where they lack a majority, but that process is cumbersome.
"We are getting firm support for our practical response," the Yomiuri quoted Shigeru Ishiba, the LDP's No.2 leader, as saying. "We must achieve results so that we can maintain this support."
(3) Change of guard at Tata Group
The head of Tata Group, Ratan Tata, was quietly handing over the reins of the business empire on his 75th birthday on Friday as he basked in the plaudits for turning the organisation into a global power.
Tata, who steered the group for 21 years as chairman, has been credited with transforming it into a streamlined conglomerate of more than 100 companies and earning a global reputation for eye-catching acquisitions of Western firms.
There was no event scheduled to mark the transition, which will see Cyrus Mistry -- a relative through marriage of Ratan Tata -- become the new supremo.
From luxury cars to steel, Tata is India's largest group with total combined sales of $100 billion in 2011-12, nearly 60 per cent of which came from business outside India, mainly the United States and Britain.
During Ratan Tata's time at the helm, the organisation went on a global purchasing spree, acquiring major names ranging from Tetley Tea to Land Rover and the Anglo-Dutch steel firm Corus in 2007 for $13.7 billion.
In addition, Tata Motors is India's top vehicle maker while Tata Consultancy Services is its largest software outsourcer.
(4) US consumer confidence falls on fiscal cliff fears
US consumer confidence tumbled in December, driven lower by fears of sharp tax increases and government spending cuts set to take effect next week.
The Conference Board said on Thursday that its consumer confidence index fell this month to 65.1, down from 71.5 in November. That's second straight decline and the lowest level since August.
The survey showed consumers are slightly more optimistic about current business conditions and hiring. But their outlook for the next six months deteriorated to its lowest level since 2011, the survey showed.
Lynn Franco, the board's director of economic indicators, said the decline in expectations for the next six months is a signal that consumers are worried about the "fiscal cliff." That's the name for the automatic spending cuts and tax hikes that take effect January 1 if the White House and Congress can't reach a budget deal.
Expectations also plunged in August 2011 when a fight over the federal debt limit brought the government to the brink of insolvency, she said.
A separate consumer confidence survey released last week by the University of Michigan fell to a five-month low this month. And reports show the holiday shopping season was the weakest since 2008, when the country was in a deep recession.
Negotiations between President Barack Obama and House Republican leaders on a package to avert the sharp tax increases and spending cuts reached an impasse last week. Obama and congressional lawmakers return to Washington on Thursday to resume talks with just days to go before economy goes over the fiscal cliff.
Treasury Secretary Timothy Geithner added pressure to the talks on Wednesday by alerting Congress that the government was on track to hit its borrowing limit on December 31. He said Treasury would take "extraordinary measures as authorized by law" to keep the government operating for another couple of months.
Still, he added, uncertainty over the outcome of negotiations over taxes and spending made it difficult to determine how much time those measures would buy.
The Conference Board index has risen from an all-time of 25.3 touched in February 2009. It remains well below the level of 90 that is consistent with a healthy economy. It last reached that point in December 2007, the first month of the Great Recession.
There are signs the economy is improving. The job market is slowly improving and the average number of people filing for unemployment benefits over the past month fell to the lowest level since March 2008.
Home sales are up over the past year and prices are rising, signaling the housing recovery is sustainable. Companies ordered more long-lasting manufactured goods in November. And Americans spent more in November. Consumer spending drives nearly 70 percent of economic growth.
While a short fall over the cliff won't push the economy into recession, most economists expect some tax increases to take effect next year. That could slow growth.
(5) Potential hike in diesel may effect investment in auto industry
With the buzz about diesel prices going up by Rs 10 per litre over the next ten months doing the rounds, the auto industry's demand for a clear fuel policy is picking up speed.
Currently the gap between petrol and diesel has come down to around Rs 20 per litre. If the government does go ahead with the increase in diesel fuel prices, that gap would further reduce to around Rs 10 per litre - neglible given the discounts and other benefits that are currently pushing petrol car sales.
The diesel fuel price hike is not something the auto industry is too unhappy about. It has been lobbying hard for price parity between petrol and diesel as against the imposition of a diesel tax on diesel fuel vehicles.
The argument is that private diesel vehicles consume a miniscule percentage of the total diesel consumption in the country and the transportation sector comprises a much larger slice of the diesel vehicle pie.
The demand for diesel cars has already started to slide following the Rs 5 per litre increase in diesel prices in September.
Car makers with both petrol and diesel variants of the same model now say the diesel-petrol sales ratio is down to 80:20 from 85:15 earlier.
Most diesel models are no longer commanding waiting lists and many are in fact already on discount.
The diesel petrol price differential - which at one point was as high as Rs 24 per litre - led to the complete diesel-isation of the Indian car market from less than a third to more than 60%.
The increase in diesel prices and the sliding demand for diesel cars may give car companies planning diesel engine facilities in India something to think about.
Car companies like Maruti Suzuki, for instance, have already announced that it would take a call on increasing investments in its diesel facility in Manesar once the fuel policy road map becomes clearer.
(1) Mulayam goes soft on Muslim quota
(2) CPM leader's rape remark against Mamata sparks row
(3) Travel chaos as deadly storm hits northeast US
(4) Carmakers offering heavy discounts even on newly launched cars to put sales on track
(5) IRDA chief differs with finance ministry over new post
(6) Craig Mundie to retire from Microsoft
(7) Australia thrash Sri Lanka to seal series
(8) India go down 4-5 in final against Pakistan
(9) Cricket: SA, Windies find glory in 2012
(10) Oscar-nominated composer Richard Rodney Bennett dies
5 Stories for Today
(1) Modi’s rise raises thorny succession issues the BJP will need to settle
(2) Japan voters back new PM cabinet, economy top priority
(3) Change of guard at Tata Group
(4) US consumer confidence falls on fiscal cliff fears
(5) Potential hike in diesel may effect investment in auto industry
(1) Modi’s rise raises thorny succession issues the BJP will need to settle
Narendra Modi didn't lack high-profile attendees at his swearing-in on Wednesday as Gujarat's fourth-time chief minister. BJP bigwigs including L K Advani and Nitin Gadkari were there. So were all NDA CMs, barring Bihar's Nitish Kumar. Also notably present were AIADMK's Jayalalithaa, MNS's Raj Thackeray, Shiv Sena's Uddhav Thackeray and INLD's Om Prakash Chautala. If this was Modi's way of showcasing a phalanx of possible backers for his national ambitions, he made his point. Only, the show of strength - in terms of exhibited BJP unity or the potential for a reconfigured NDA - doesn't stand closer scrutiny.
Notwithstanding the rousing welcome for him from party workers at the BJP headquarters in New Delhi yesterday, Modi's political ascendancy appears a big dilemma rather than reason to rejoice for the RSS-led sangh parivar. This explains the apparent reluctance so far of the BJP - which seems guided by Nagpur - to facilitate the catapult of its star vote-catcher and unapologetic spokesman of muscular nationalism to the national stage. Nor would scandal-hit party chief Gadkari - who's thought to have RSS backing - presume to downplay Modi's growing clout. Recently, he praised Madhya Pradesh CM Shivraj Singh Chouhan as a model of deve-lopment-oriented leadership at an event the BJP fetes as "Sushasan Diwas", or good governance day. Significantly, Modi had won Gujarat for a record third time on the development plank just a few days earlier.
Gadkari isn't the only leader with ambitions to counter Modi's. The BJP seems faction-ridden on the leadership issue in the post-Vajpayee-Advani era. If it does recognise Modi's claim to being first among equals at the national level on grounds of his performance, the NDA will most likely fracture. On one hand, Modi's inability to junk his Hindutva hawk image dents his national acceptability. On the other, he's paradoxically - and aggressively - been his own man in politics despite belonging to the sangh parivar, whose sectarian ideology is a waning influence in new, aspirational India.
The BJP on its part seems unable to function as an outfit that takes independent political decisions based on hard-nosed calculations, including when filling top posts. The way out of this conundrum is for it to turn itself into a modern outfit whose leaders - from party chief to prime ministerial nominee - are chosen via in-house elections. This will buttress its oft-made claim to being guided by democratic processes unlike the dynasty-driven Congress. It'll also help settle thorny succession questions creating disunity. With all eyes on 2014, the BJP needs to check internal disarray - and fast.
(2) Japan voters back new PM cabinet, economy top priority
More than half of Japanese voters support new Prime Minister Shinzo Abe's cabinet, media surveys published on Friday showed, with the country's stagnant economy topping the list of problems voters want the hawkish new leader to tackle.
Abe took office on Wednesday, after his conservative Liberal Democratic Party's (LDP) landslide election victory this month, promising to revive the world's third-biggest economy with bold monetary easing and big spending by the debt-laden government.
Support for Abe's cabinet, which is packed with allies who share his conservative views but leavened with some party rivals, ranged from 52 percent in a survey by the Mainichi newspaper to 65 percent in a poll by the Yomiuri newspaper.
Fixing the economy, now in its fourth recession since 2000, was voters' top priority. Forty-eight percent of voters in a survey by the Asahi newspaper put the economy as their first priority, compared with 11 percent who stressed security issues, which are also a key element of Abe's platform.
Abe, 58, wants to revise Japan's post-World War Two constitution limits on the military so Tokyo can play a bigger global security role, but only 32 percent of voters in the Asahi poll backed the move compared to 53 percent who opposed.
Voters were split over the LDP's post-Fukushima nuclear disaster energy policy, with 46 percent in favour of its plan to restart off-line nuclear reactors that are confirmed safe and 45 percent opposed, the Yomiuri said.
Abe, who quit abruptly in 2007 after a troubled year in office during which his early high support rates crumbled, is all too aware of the need to show results quickly ahead of a July election for parliament's powerful upper house.
The LDP and its smaller coalition partner won the two-thirds majority in the lower house that allows them to enact bills rejected by the upper chamber, where they lack a majority, but that process is cumbersome.
"We are getting firm support for our practical response," the Yomiuri quoted Shigeru Ishiba, the LDP's No.2 leader, as saying. "We must achieve results so that we can maintain this support."
(3) Change of guard at Tata Group
The head of Tata Group, Ratan Tata, was quietly handing over the reins of the business empire on his 75th birthday on Friday as he basked in the plaudits for turning the organisation into a global power.
Tata, who steered the group for 21 years as chairman, has been credited with transforming it into a streamlined conglomerate of more than 100 companies and earning a global reputation for eye-catching acquisitions of Western firms.
There was no event scheduled to mark the transition, which will see Cyrus Mistry -- a relative through marriage of Ratan Tata -- become the new supremo.
From luxury cars to steel, Tata is India's largest group with total combined sales of $100 billion in 2011-12, nearly 60 per cent of which came from business outside India, mainly the United States and Britain.
During Ratan Tata's time at the helm, the organisation went on a global purchasing spree, acquiring major names ranging from Tetley Tea to Land Rover and the Anglo-Dutch steel firm Corus in 2007 for $13.7 billion.
In addition, Tata Motors is India's top vehicle maker while Tata Consultancy Services is its largest software outsourcer.
(4) US consumer confidence falls on fiscal cliff fears
US consumer confidence tumbled in December, driven lower by fears of sharp tax increases and government spending cuts set to take effect next week.
The Conference Board said on Thursday that its consumer confidence index fell this month to 65.1, down from 71.5 in November. That's second straight decline and the lowest level since August.
The survey showed consumers are slightly more optimistic about current business conditions and hiring. But their outlook for the next six months deteriorated to its lowest level since 2011, the survey showed.
Lynn Franco, the board's director of economic indicators, said the decline in expectations for the next six months is a signal that consumers are worried about the "fiscal cliff." That's the name for the automatic spending cuts and tax hikes that take effect January 1 if the White House and Congress can't reach a budget deal.
Expectations also plunged in August 2011 when a fight over the federal debt limit brought the government to the brink of insolvency, she said.
A separate consumer confidence survey released last week by the University of Michigan fell to a five-month low this month. And reports show the holiday shopping season was the weakest since 2008, when the country was in a deep recession.
Negotiations between President Barack Obama and House Republican leaders on a package to avert the sharp tax increases and spending cuts reached an impasse last week. Obama and congressional lawmakers return to Washington on Thursday to resume talks with just days to go before economy goes over the fiscal cliff.
Treasury Secretary Timothy Geithner added pressure to the talks on Wednesday by alerting Congress that the government was on track to hit its borrowing limit on December 31. He said Treasury would take "extraordinary measures as authorized by law" to keep the government operating for another couple of months.
Still, he added, uncertainty over the outcome of negotiations over taxes and spending made it difficult to determine how much time those measures would buy.
The Conference Board index has risen from an all-time of 25.3 touched in February 2009. It remains well below the level of 90 that is consistent with a healthy economy. It last reached that point in December 2007, the first month of the Great Recession.
There are signs the economy is improving. The job market is slowly improving and the average number of people filing for unemployment benefits over the past month fell to the lowest level since March 2008.
Home sales are up over the past year and prices are rising, signaling the housing recovery is sustainable. Companies ordered more long-lasting manufactured goods in November. And Americans spent more in November. Consumer spending drives nearly 70 percent of economic growth.
While a short fall over the cliff won't push the economy into recession, most economists expect some tax increases to take effect next year. That could slow growth.
(5) Potential hike in diesel may effect investment in auto industry
With the buzz about diesel prices going up by Rs 10 per litre over the next ten months doing the rounds, the auto industry's demand for a clear fuel policy is picking up speed.
Currently the gap between petrol and diesel has come down to around Rs 20 per litre. If the government does go ahead with the increase in diesel fuel prices, that gap would further reduce to around Rs 10 per litre - neglible given the discounts and other benefits that are currently pushing petrol car sales.
The diesel fuel price hike is not something the auto industry is too unhappy about. It has been lobbying hard for price parity between petrol and diesel as against the imposition of a diesel tax on diesel fuel vehicles.
The argument is that private diesel vehicles consume a miniscule percentage of the total diesel consumption in the country and the transportation sector comprises a much larger slice of the diesel vehicle pie.
The demand for diesel cars has already started to slide following the Rs 5 per litre increase in diesel prices in September.
Car makers with both petrol and diesel variants of the same model now say the diesel-petrol sales ratio is down to 80:20 from 85:15 earlier.
Most diesel models are no longer commanding waiting lists and many are in fact already on discount.
The diesel petrol price differential - which at one point was as high as Rs 24 per litre - led to the complete diesel-isation of the Indian car market from less than a third to more than 60%.
The increase in diesel prices and the sliding demand for diesel cars may give car companies planning diesel engine facilities in India something to think about.
Car companies like Maruti Suzuki, for instance, have already announced that it would take a call on increasing investments in its diesel facility in Manesar once the fuel policy road map becomes clearer.
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