Today's Hot Stories - April 09, 2014
10 Headlines for Today(1) Riot-hit villages show maturity, say no to posters
(2) Modi files nomination from Vadodara after huge road show
(3) Pro-Russia protesters storm govt building in Ukraine
(4) Air India links pilots' emoluments to flying hrs
(5) Analjit vies for 33% stake in Sula
(6) Maruti Suzuki may recall 1-lakh Swift and DZire on faulty fuel pipe
(7) Triple Olympic gold medallist Stephanie Rice retires
(8) US wrestling star Ultimate Warrior dies at 54
(9) Real Madrid reach semis despite loss
(10) Forest department, NHAI plan speed bumps, signages to protect lions
5 Stories for Today
(1) Congress candidates aren’t getting much money from the party
(2) MH370 hunt to be most expensive in aviation history
(3) ETA will help boost tourism in India: Tourism Secretary
(4) Several foreign hotel chains like Rotana, Meininger, Jumeirah and Six Senses eye Indian market
(5) RBI shifts to CPI-based Real Effective Exchange Rate
(1) Congress candidates aren’t getting much money from the party
As if the burden of incumbency wasn't enough, Congress's task in the current Lok Sabha polls seems to have been further complicated by what party managers claim is a severe funds crunch, which has put it at a further disadvantage vis-a-vis a resurgent BJP.
A Congress heavyweight told this paper, "Between Congress and BJP, they are getting 90% of the money, we are getting just 10%." Even if that sounds like a bit of an exaggeration, conversations with Congress candidates and their managers over the past week indicate that the ruling party has, for a change, been vastly outgunned by the BJP, and may actually be running on half-empty.
"I have seen several Lok Sabha and assembly elections, but the financial deficit Congress is facing this time is unprecedented," says a veteran Congress MP.
Saffron is daubed all over - on billboards, bus stand shelters, kiosks and newspapers - forming the backdrop to the smiling visage of Narendra Modi. When you don't see him, you hear him on the radio and on your phone. Indeed, rarely has the country seen such an election advertising blitz.
In comparison, the Congress appears in bits and patches. Rahul Gandhi, with several aam admi and aurat in tow, stands defensively with his hands folded on billboards, which are few and far between.
Party managers in states like Chhattisgarh, Punjab and Maharashtra say the money this time is well below normal. The big donors - industrialists and other sundry moneybags - appear to have divined which way the wind is blowing. And their money is flowing in that direction.
While Congress claims the gap is due to big business's proximity to Modi - there are stories of how at least two houses are backing him to the hilt - those familiar with the business of campaign finance say India Inc makes a cold-blooded assessment of the prospects of different contenders, more so in this era of coalitions and diverse polity when different parties are at the helm in different states and smaller parties enjoy disproportionate clout in decision-making. So the money is distributed after calculating who needs to be kept happy where.
Congress's own success in the UPA years bears testimony to this. The party, which won in 2004 ostensibly because of a backlash against BJP's 'India Shining' pitch - shorthand for pro-business - and zealously pursued its aam aadmi plank, pulled in more funds than the BJP in the last decade.
According to income tax returns filed by the two parties and analyzed by Association for Democratic Reforms (ADR), Congress' income in 2004-05, the year UPA-1 was formed, was Rs 222 crore against BJP's Rs 104 crore. Ever since, the ruling party's coffers have swelled and its total income in the eight years till 2011-12, the latest for which I-T returns are available, was Rs 2,338 crore. During the eight-year period, BJP received Rs 1,303 crore. The big two were followed by CPM with an income of Rs 520 crore and BSP with around Rs.500 crore.
This story seems to have changed. Congress veterans in Uttar Pradesh say flow of funds from the party is down almost 30% this time. The party typically sends one-fourth of the amount by cheque to the candidate's account. The rest comes in cash; this is mainly directed towards winnable seats. Said a sitting MP from Maharashtra: "The well-off candidates can make do without leaning on the party, but the others are badly hamstrung this time."
Leading business houses, and sectors that are flush with cash like real estate and mining, are this time almost fully behind the BJP. Half of the 48 Congress-NCP candidates in Maharashtra that TOI spoke to admitted as much. A top builder told this paper, "Most of us are very unhappy with the (Maharashtra) government. In the last three years, hardly any projects have been cleared."
The paucity of funds is apparent from the delay in their disbursal. In 2009, "official" financial assistance came immediately after the names of candidates were announced. This year, the party candidates in Western UP - which goes to the polls in the first three rounds - have had to wait till the last date of withdrawal before receiving any assistance.
In the December assembly polls, sources said the central leadership gave Rs 60 lakh for most seats in Chhattisgarh and Madhya Pradesh, while Delhi and Rajasthan had Congress governments which took care of the candidates.
Partymen in Chhattisgarh say only two seats are likely to see "extra and special" financial help. There was fond hope that the party would give funds to individual seats at par with what was given in 2009, with a hike based on five years of inflation - Rs 1 crore per seat. Nothing has come yet. The anxiety stems from the fact that Congressmen are up against candidates being supported by three-time chief minister Raman Singh who is flush with funds and has the backing of industrialists.
Most leaders in resource-rich Punjab are said to be capable of self-financing yet party money matters in the fight against Akali Dal. A senior leader confessed "it will be like this" - which means that expectations of central funding have to be lowered this time.
The most curious case is the financial powerhouse of Maharashtra. Though Congress has been in government in Mumbai for 15 years, a party leader confessed, "Even we are feeling it." The state has traditionally done without central funding, but this time candidates are having to canvas support personally and even ask resourceful colleagues for help.
In the 2009 Lok Sabha and assembly polls, most Congress nominees had received a healthy financial boost from the party; some figures put it at Rs 50 lakh per candidate. Not this time.
UP Congress leaders say Congress follows a standard system for fund distribution here. Constituencies are graded 'A', 'B' or 'C', depending on the strength of a candidate and the seat's winnability, 'A' being the strongest and 'C' the weakest. Funds are then allotted accordingly.
Congressmen say the party has released up to Rs 50 lakh for seats like Ghaziabad and Saharanpur - both 'A' grade seats. Bigger electoral fights like Lucknow and Varanasi are expected to attract more funds - up to Rs 3-4 crore.
In all this, Congress leaders say, the worst affected would be states like Tamil Nadu where the party has no hope this election after its failure to find a strong ally. Given the dismal state of affairs, TN candidates are not only low on the central leadership's list of priorities, they unable to find sponsors even locally.
In Karnataka, it's different. Several Congress candidates have intensified their campaign minus any financial support from the party. But they aren't complaining. "Gone are the days when we used to get an assured sum from the party. Now there is an unwritten rule in the party that candidates have to fight elections on their own. We are not sure whether it's because of a funds crunch or any other reason," says a party candidate, who is fighting his second successive Lok Sabha polls.
Source: The Times of India
(2) MH370 hunt to be most expensive in aviation history
The hunt for missing Malaysian Airlines Flight MH370 is on track to cost hundreds of millions of dollars, becoming the most expensive search in aviation history with 26 countries contributing planes, ships, submarines and satellites to the international effort.
A month into the search for the jet, estimates compiled by Reuters show that at least $44 million has already been spent on the deployment of military ships and aircraft in the Indian Ocean and South China Sea by Australia, China, the United States and Vietnam. The figure is based on defence force statistics on available hourly costs of various assets, estimates by defence analysts and costs reported by the Pentagon.
The figure for the first month of the search is already about equal to the official 32 million euros spent in searches lasting several months spread over a two-year time frame for Air France's Flight AF447, which crashed into the Mid-Atlantic in 2009.
Just as salvage experts said the actual costs for the Air France operation could have been three or four times higher than the official figure, the bill for the current search is expected to run into hundreds of millions of dollars.
The $44 million estimate for MH370 does not cover all the defence assets being used by countries including Britain, France, New Zealand and South Korea, nor numerous other costs such as civilian aircraft, accommodation for hundreds of personnel and expenses for intelligence analysts worldwide.
Britain dispatched a nuclear-powered submarine, HMS Tireless, to assist in the search, without disclosing the vessel's previous location.
Angus Houston, the retired Air Chief Marshal in charge of the Australian-led international search, said on Friday he would give an overall estimate of the cost at a later date.
"It's a lot of money," he said.
A financial reckoning
Australian Prime Minister Tony Abbott, whose country is leading the search, and his Malaysian counterpart, Najib Razak, have repeatedly said the cost of the search is not an issue.
Still, Abbott has hinted that Australia, which has so far borne the brunt of the expense as the search homes in on the southern Indian Ocean off its western coast, may at some point be sending out invoices.
"It's only reasonable that we should bear this cost - it's an act of international citizenship," Abbott said last week.
"At some point, there might need to be a reckoning, there might need to be some kind of tallying, but nevertheless we are happy to be as helpful as we can to all the countries that have a stake in this."
A Malaysian government source, who declined to be identified as he was not authorised to speak to the media, said the entire search and recovery for MH370 could be at least double the money spent to recover the black box from Air France's AF447.
Australia has so far contributed around half of the cost, with ships and aircraft on duty for some three weeks. Its HMAS Success alone costs around A$550,000 a day to operate, according to Australian Defence Force, or ADF, figures.
"The search effort for MH370 is costing the ADF at least A$800,000 per day and possibly considerably more than that," said Kym Bergmann, editor of Asia-Pacific Defence Reporter and a former government defence adviser.
"While that might not sound like much compared with the ADF's annual sustainment budget of A$5 billion, if this continues for much longer other activities such as 'Operation Sovereign Borders' will be under pressure to find savings," he added, referring to the federal government's policy of turning back asylum seeker boats that approach from Indonesia.
China, US spending
The other big spenders so far are China and the United States.
China, which was home to the majority of the 227 passengers on board the missing plane, has sent a total of 18 ships, eight helicopters and three fixed-wing aircraft to various search areas during the month-long hunt.
Beijing has declined to comment on how much it is spending on looking for the aircraft, saying only it is dedicated to keep searching "as long as there is a shred of hope".
China has been sending two Ilyushin Il-76 aircraft, on alternate days, on sorties from RAAF Pearce Base near Perth for almost three weeks. The Global Times, an influential tabloid published by the ruling Communist Party's official People's Daily, estimated that an Ilyushin Il-76 costs $10,000 an hour to keep in the air on fuel alone, not including money spent on maintenance or accommodation for the crews.
Chinese warships would cost at least $100,000 a day to operate, and most likely a lot more, the newspaper added.
"There's a lot of pressure in China to find the plane," said a Beijing-based Western diplomat. "China will spare no effort."
The Pentagon said last week that it had already spent more than $3.3 million on the search and has put in place plans to nearly double its original $4 million budget.
As well as flying its P-8 surveillance planes out of Perth, the U.S. Navy is playing an instrumental role via its high-tech underwater black-box detector equipment.
It has sent both its Towed Pinger Locator, which this week picked up signals which may be from the missing plane's cockpit data recorders, and a Bluefin-21 autonomous underwater vehicle.
An earlier search in the South China Sea by Vietnam was estimated by local media to cost $8 million, a figure that has not been verified by officials.
Source: Hindustan Times
(3) ETA will help boost tourism in India: Tourism Secretary
The move to grant in principle approval for Electronic Travel Authorisation (ETA) to travellers from 180 countries to India will boost tourism in the country, Tourism Secretary Parvez Dewan said on Tuesday.
“Travelling to India will be made easy once the ETA to visit the country becomes operational,” he said.
ETA, which will allow foreign travellers to apply for a visa from home and receive an online confirmation in five working days, is expected to become operational by October. Barring eight prior reference countries, which include Pakistan, Afghanistan, Iran, Iraq, Somalia, Sudan, Nigeria and Sri Lanka, government has decided to give e-visa to all the 180 countries.
Mr. Dewan added that during the past year, India had considerably relaxed its visa regime and expanded the Visa-on-Arrival (VoA) scheme.
India launched the VoA scheme in January 2010 for citizens of five countries – Finland, Japan, Luxembourg, New Zealand and Singapore — visiting India for tourism purposes. The scheme was later extended to six more countries in January 2011.
Further, the secretary said that a dedicated helpline for inbound tourists will be launched in a year. "Tourism Infoline in 12 languages will become operational in about a year," he said.
The Infoline – a dedicated call centre -- will provide information regarding tourist-related facilities and services available in the country.
Source: The Hindu
(4) Several foreign hotel chains like Rotana, Meininger, Jumeirah and Six Senses eye Indian market
A string of global hotel chains including Rotana, Meininger, Jumeirah and Six Senses is waiting to enter the country in the next two years, attracted by the growth prospects this market offers.
"If you look at the global situation right now, for these brands, China and India are the two largest markets," says Kaushik Vardharajan, partner managing director, Asia Pacific, at hospitality consultancy HVS.
"Everybody continues to believe that India has the potential, no matter how bad the numbers look." As these brands are already present in China, their current focus is on India. They are in exploratory stages to launch a mix of their portfolio, mainly in the mid market segment. Berlin-headquartered Meininger , owned by travel major Cox & Kings, is considering operating leases and management contracts in India, through tie ups with unbranded hotels operating in good locations.
Navneet Bali, the company's chief executive, says India is one market no one can choose to ignore. "It is still relatively 'unhoteled' and the travel market is expected to double in the next seven-eight years from 850 million travellers. And since Indians by nature are price sensitive and value conscious, our philosophy will fit right in."
While hotel management companies are upbeat about the Indian market, finding the right partner here is proving to be a challenge for them. According to Aman Aditya Sachdev, senior vice president for South Asia and Southeast Asia at Rotana Hotel Management Corp, choosing the partner has been tough after the company decided to enter India about two years ago.
"By the time we made our entry into the market, things had slowed down. That has made us work a little harder. It is difficult to find long-term partners in India and since a lot of developers come from a residential development background, they expect quick returns," he says.
Sachdev, however, adds that India is extremely under serviced and Rotana is looking at opening 20 operating hotels in the next decade. The Middle-East hotel chain plans to focus on the mid market segment in the country, looking at the significant growth potential.
According to HVS, mid-market brands make up 34.4% of the proposed branded hotel supply between 2012-13 and 2017-18. Vardharajan of HVS however says that it is currently a wait and watch situation for these companies and while they are charting plans for the country, their actual entry will only happen post elections.
Dubai-based Jumeirah Group, a member of Dubai Holding, had been in talks to open properties in Mumbai and Goa. But owning to the macroeconomic scenarios, timelines to conclude deals are getting longer and harder.
The new hotel companies will also have to face stiff competition from existing Indian brands like Citrus and Keys which are on an expansion drive. Citrus Hotels and Resorts, for instance, recently added five hotels in new micro markets in India.
Keys Hotels has a pipeline of 22 properties that are expected to open in the next two years. The company is also in talks for 80 new deals and expects 20% of them to convert into management contracts.
Typically, a mid-market or budget hotel would cost around Rs 20-25 lakh per room and would be sustainable at max 100 rooms. And banks are open to lending to the new wave of projects. "Even if they are lesser-known brands right now, but with a good micro-market, banks would be willing to lend," says Deven Shah, senior vicepresident for debt capital markets at Kotak Mahindra Bank that lends to hospitality projects.
Project cost for a mid-market or budget hotel would be around Rs 20-30 crore, excluding the land cost which would not be very high in these locations, he says.
Source: The Economic Times
(5) RBI shifts to CPI-based Real Effective Exchange Rate
India unhappy, but unshaken by rupee's plunge to record low
Shifting focus to retail inflation, the Reserve Bank today said it will compute and release Real Effective Exchange Rate (REER) only on the basis of the Consumer Price Index (CPI) as the price index for India from this financial year.
“REER index constructed using a CPI for both India and trade partner countries would ensure a higher degree of comparability of former’s international competitiveness vis-à-vis trading partner countries,” the RBI said in a release.
REER indicates movements in exchange rates of the home currency against a basket of currencies of trade partner countries and is considered to be an indicator of international competitiveness.
Since October 2013, the RBI has started providing indicative projections of inflation in terms of the broader CPI-Combined.
“Thus, with greater focus on CPI inflation as primary objective of domestic monetary policy, it is pertinent to have an alternative index of REER based on CPI,” RBI said.
Till now, in the case of India, the RBI was providing the REER index using the Wholesale Price Index (WPI) for India and CPI for partner countries.
The RBI today released a monthly series on CPI-based REER for both six-currency and 36-currency baskets for the period April 2004 to March 2014.
It said from this financial year, only the CPI-based REER would be compiled and released.
Source: The Indian Express
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