1072 If Mr. Narendra Modi is a Prime Minister of 'Yeh masla hai kya (What is the Problem?', will Mr. Rahul Gandhi be a PM of 'yeh masAla hai kyA? (What is this pot-pourri?)'

Photo modified by ybrao-a-donkey. Due apologies to PMOI and FMOI.
Utterances of our Rulers are like acts of our past birth. In 2012, Mr. Arun Jaitley, BJP Leader in Rajya Sabha,and present Finance Minister, spoke about Weakness of Indian Rupee, and the Evil of Increase in Prices of Petrol and Diesel. See the following Video, at youtube.com.:--
Above are some screenshots from the Video.

Click here to go to PM's Youtube Video https://www.youtube.com/watch?v=FKkkxUDIawQ


Click here to go to https://www.youtube.com/watch?v=iJQxjwlEBqEsee the Video in which Mr. Arun Jaitley, Finance Minister spoke about Weakness of Rupee, and Increase in Petrol Prices.

Question: It appears as though that Mr.Narendra Modi and Mr. Arun Jaitley have failed in maintaining a sort of stability of External Value of Indian Rupee. Do you think that, Mr. Rahul Gandhi, if elected to power, can uplift and stabilise Indian Rupee?

Ans: Ideal Position

Ans: In an ideal situation, be it Indian Rupee, or any other International Currency has to find an equilibrium for its external value, on the basis of demand for it from Foreign Buyers, and other Remittance Senders into India,, whereas Supply of Rupee comes from Indian Importers, and other Outward Remittance Senders from India to abroad.

This type of Ideal Situation might have been possible some decades back when there were no/few Foreign Direct Investments and Foreign Portfolio Investments into India.Those were days when Balance of Trade and Balanace of Payment Components were few in number, and were less complex. Today, the Fluctuations in Receipts and Payments relating to Foreign Investments seem to dominate India's Balance of Payments Current Account Position.

Though most of the Foreign Investments into India, unlike the Foreign Investments into China, are believed to be Recycled Remittances of the Money Laundered funds of Indian Corporates, and Indian Industrialists, somehow even they seem to be subject to vicissitudes and vagaries of Algoriths operating in Europe, North America, and Tax Haven Countries which decide when to invest and when to withdraw sometimes based on Mathematical Reasoning, and sometimes based on Intuition or hunches or beliefs. Consequently, even for minor or flimsy developments in global markets, Foreign Investors sell away their Investments or buy in bulk.

Mr. Rahul Gandhi may not have necessary inclination or time to study these intricacies and discuss with Finance and Commerce Ministers.

This is a problem with almost all the Prime Minsiters who ruled India ever since Independence, with the probable exception of Mr. Manmohan Singh. Though Mr. Manmohan Singh is regarded as an Economics Expert by virtue of his studies at London School of Economics, the 1991 Reforms initiated by him ever since 1991, do not prove that he acted with a "Studied mind". Reason: Anybody, who has a very basic idea about the unreliability and volatility of World Investment Streams will never create an Economy which is dependent on Foreign Investment Flows. Of course, Mr. Manmohan Singh may not be the only Finance Minister on this Earth, who crave for Foreign Investments.

Almost all the Economic Advisers to Indian Government are those who have worked with IMF, World Bank etc., or worked as Professors in Euro-American Universities, and they have brain-washed intelligences, and their Intellects have lost their intrinsic worth(s).

Mr. Narendra Modi seems to be his own Economic Adviser, who seems to believe that he does ot need guidance with IMF-World-Bank brainwashed Experts, or Indigenous Experts. This may be the reason for Mr. Narendra Modi's sudden secretive announcement of Demonetisation on 8th Nov. 2016.

Here is an Article by Mr. Aakar Patel, Renowned Writer, in Deccan Chronicle dated 11th Dec. 2016, about Mr. Narendra Modi's style of taking decisions and signing files: Click here to go to DEC and study the Article. http://www.deccanchronicle.com/opinion/op-ed/111216/note-ban-success-test-of-pms-working-style.html

Courtesy above article of Shri Aakar Patel, from Deccan Chronicle: Mr Modi also revealed that he was a “good listener” and was able to absorb what was being said to him well. When I heard him say this I thought it made him vulnerable to the bureaucrats he was trusting because he is dependent and can be fed as much or as little as the officer wants him to know. In the style of working as Mr Modi describes it, a complex matter that occupies dozens and perhaps hundreds of pages in files is reduced to an oral summary. It is possible that because of lack of time or because the issue is overly complex, the oral summary is simplistic. "... On the basis of this summary, Mr Modi takes a decision and this is then executed through the administration. This style seems to have worked well for Mr Modi because he is thought of as being a good chief minister in his 12 years in Gujarat. These days, however, I have been again thinking about Mr Modi’s style of taking input in this form when taking decisions. That is because the Supreme Court is asking critical questions about the way in which the demonetisation policy was rolled out. The court wants to know if the policy was planned properly, or a decision was taken “just like that” when Mr Modi scrapped Rs 500 and Rs 1,000 notes on November 8. ..." "...Another important thing he revealed was how he actually worked. Mr Modi said he doesn’t read files. This I found to be unusual in someone who is so decisive because one needs full control over the subject if one is eager to take big decisions. But Mr Modi says he cannot govern through “academics studies (sic)” and instead asks his officers to summarise all issues for him, and brief him orally. They are expected to go through the file and tell him, as he put it, “yeh masla hai kya”. He said he had the capacity to figure out the delicate contours of these issues without actually reading about them. He said this is because “mera itna grasping tha”. ..."

ybrao-a-donkey's views which are not intended to be imposed on Readers

This practice of PM's signing files on the basis of 'oral summaries' made by his Assisting Officers, after asking 'yeh masla kyA hai' seems to be a very dangerous practice. Nor that a Superior should suspect everything which his Subordinates bring for signing, but we have to keep in mind that Subordinates can also make mistakes or even blunders. Or else, there should be no need need of concentrating all the Powers in the Prime Minister.

Mr. Rahul Gandhi also appears to be a less serious person uninterested in Principles of Economics. Obviously, he seems to depend for his activities and speeches on the persons surrounding him.

Question: Do you mean to say that Mr. Manmohan Singh was surrounded by novices in Economics?

Ans: Definitely not. I mean to say that Economic Advisers of Indian Prime Ministers (probably Prime Ministers of many underdeveloped and developing countries of the World) are surrounded by IMF-World Bank-WTO and Schools of Euro-centric Economics/University trained Economists, who have not only pro-industrial bias, pro-Multi-National bias and skewness, but also seem to suffer from an un-self-controllable itches to enforce what they learn in those Institutions and Organisations.

On the other hand, most politicians of Developing and Underdeveloped countries (with the exception of Advisers to and Executives of, Dictatorial regimes) face a need to continuously tune themselves to the needs of Poverty-stricken and Sop-craving Voter-classes feeding which requires Welfare Economics.

Question: What is that you are upto? Are you confused?

Ans: There is no confusion. These subjects under our discussion are very wide, and hence some cramming seems to take place, when I try to compress into space of one blog post page, or a few blog post pages.

We started this Blog Post with the links of criticism made by Mr. Narendra Modi and Mr. Arun Jaitley about falling Rupee, and Increase in Petroleum Prices. One important feature which we cannot omit to notice here is: Should Opposition Party politicians before making scathing criticism(s) against Ruling Parties and Governments, think ahead of the times when they will come into Power, and will have to adopt the same policies, because the Economic Philosophies of all the Rightist, Centrist, Centrist-Left Parties are nearly same, notwithstanding their occasional electoral postures and position-ings?

This is important because Mr. Rahul Gandhi is hammering the BJP day-in and day-out about the undue benefits given by Modi's Government to an Immature and Un-qualified Company of Mr Anil Ambani. We must keep in mind that Mr. Rahul Gandhi (or whoever else such as Ms. Mamta Banerjee's Front, X's Front, Y's Front with support from Mainstream Parties) are going to continue the same Economic Policies of Mr. Narendra Modi and Jaitley. That means, whichever Party/Leader comes into power in 2019 will have to / will continue the Rafael Supply Contract, together with its Anil Ambani component. We must remember, at least, as far as making / servicing of Fighter Aircrafts are concerned, the opportunities of HAL (Hindusthan Aeronautics Ltd. the Cinderella Govt. Company) seem to be sealed.

This is because, except in situations of compelling circumstances, Governments globally have a commitment to honor International Agreements entered into by Previous Governments. This cannot be ignored by Politicians, Top Bureaucrats and Advisers-to-politicians-and-Top-Bureaucrats, fortunately for them because, Public Memory and Voter Memories are poor.

Question: Do you mean to say that Newly Succeeding Governments who follow rotten Regimes cannot / should not have a leeway to adopt Innovative Policies to reverse the Decay which has set in?

Ans: If a Newly succeeding Government which initiates sweeping Reforms , if it believes that it is overburdened with international debt, and obligations arising from commitments made to Foreign Investors, try to postpone or avoid honoring such international obligations, there may arise a risk of losing International Credibility. For this reason only, Governments in some countries have a system whereby they may require every major International Agreement and Policy change to be placed before their Parliaments and get them ratified with appropriate majority.

In International Economic Arena, the Issues of- Countries defaulting in their International Economic Obligations are usually classified under "Sovereign Risks", "Country Risks", and obviously they become Political Risks. On the other hand, individual Parties such as Corporates and Industrial Giants, when they default in honoring their payment and performance obligations, risks arising from such defaults, come under Commercial Risks.

Ordinarily Commercial Risks seem to arise from Political Risks, though vice versa cannot be ruled out. Besides, Political Risks can also arise from Commercial Needs and Pressures of Corporates.

Question: How will you explain all these things, in the context of your avowed objective of spreading Atheism and Marxism (or Modified Marxism/True Total Socialism)?

Ans: Apart from viewing porno videos, probably as a part of their Sexual Education (Not the Science of Sexual Hygiene or Behaviors), every denizen of World Working Class, has to study some Patho Physiology, some Pharmacology, and in addition, some Poverty Economics and Exploitation Economics. Poverty stricken and Exploited Working Classes have a long way to go. Then only, they will be able elect their Representatives who will not only have honesty, but also Competence.

Incomplete. Shall complete and reedit shortly.

732 Part 2/100 of India's Economic Growth Dilemmas and Enigmas

Mr. Raghuram Rajan, Governor, Reserve Bank of India, has tried to minimise the damage of, or neutalise criticism against his comment made in United States, "In the land of the blind, the one-eyed man is king". For that we have alrady written one blog post Problemsoftelugus post No.724 , wherein we have observed that India is not one eyed king, but is a King of Frogs. We shall, now continue, after noting down more observations of Shri Raghuram Rajan, about his one-eyed man is king comment:

"...My intent was to signal that India’s outperformance was accentuated because world growth was weak. ...".

"...I think we have still to get to a place where we feel satisfied. We have this saying - 'In the land of the blind, the one-eyed man is king'. We are a little bit that way. ..."

"...Speaking to a foreign journalist the other day, who asked what it felt like to be the bright spot in the world economy, I used the phrase 'Andhon mein kana raja' or 'In the Land of the Blind, the one-eyed man is king'...My intent was to signal that our outperformance was accentuated because world growth was weak, but we in India were still hungry for more growth. ..."

"...India’s international reputation is of a country with great promise, which has under-delivered in the past. This is why we are still the poorest country on a per capita basis among the BRICS. ..."

"...An eye for an eye will only make the whole world go blind. ... it was clear what it implied, that the whole world going blind is not a desirable state of affairs.

"... One might take umbrage since it suggests blindness is an inferior state to that of being able to see, and the saying could be seen as discriminatory. Yet Gandhiji’s focus was on the absurdity of a policy of revenge, not on blindness, and his intent was not to disparage the blind. ... "

"...At the same time, listeners should not look for insults everywhere, and should place words in context so as to understand intent. In other words, for effective communication and debate, rather than the angry exchanges that we see on some TV shows, we need both respect and tolerance. ..."

"...The greatest danger of all is that we do not communicate or debate, for then we will allow distorted stereotypes to flourish unchallenged, and divisiveness to increase. In a country like ours, conceived and flourishing in diversity, that will truly be a disaster. ..."

ybrao-a-donkey's humble comments. वैबीराव एक गधे के विनम्र राय . వైబీరావ్ గాడిద వినమ్ర వాణి. You have every right to differ with me. I respect your right. आपको मेरे मत से भिन्न राय रखने के संपूर्ण हक है। मै उस अधिकार को परिपूर्ण रूप से गौरव देता हुँ. మీకు, మీ భిన్నమైన అభిప్రాయాన్ని కలిగిఉండే సంపూర్ణ హక్కు ఉంది. దానిని ఎంతో నేను గౌరవిస్తాను. However, pl. examine this donkey's views also. परन्तु एस गधे के दृष्टिकोण को भी अनुशीलन कीजिये. కానీ ఈ గాడిద దృష్టికోణాన్ని కూడ ఓర చూపుతో కంటజూడుమీ, క్రీగంట జూడమీ.

This "King of Frogs" episode started in 1991, when Mr. P.V. Narasimha Rao, was the Prime Minister of India and when Mr. Manmohan Singh was India's Finance Minister.

Late Mr. Chandrasekhar was dethroned, when support was withdrawn by Indian National Congress. Fresh elections were held to Lower House of Indian Parliament (Lok Sabha). Mr. Rajiv Gandhi, the Former Prime Minister of India was assassinated at Sriperumbudur. In that milieu, Mr. Narasima Rao became the PM of India, and Mr. Manmohan Singh, the India's Finance Minister.

At that particular point of time (1991), India was facing a grave Foreign Exchange Reserve Crisis. The predecessor Chandra Sekhar Government was forced to export Indian gold to London, and mortgage it to tide over an import payments and debt service crisis.

Amidst that environment, it was difficult to say, whether India was caught in a debt-trap or not. Reasons: India traditionally relied on soft loan windows like I.D.A. which had long repayment schedules with only some minuscule service charge to pay.

Later, it shifted to borrowing from World Bank, with Medium Term Repayment Schedules. With the World Bank Borrowings, we inherited hidden controls in the name of Supervision of End Use. Yet, India was nowhere near an external debt trap. We were still treading a safe-course, though we have lost a part of economic sovereignty.

For those who are not familiar with the term debt-trap: The term can apply to individuals, families, Corporates and Conglommerates, even Nations. It is a situation where an entity has to contract fresh loans to repay instalments of old loans.

Then the next stage came. India started borrowing from IMF (International Monetary Fund) to overcome short term payment difficulties. The IMF had its own ARM-TWISTING TACTICS. Its diagnostic weapon was / is "STRUCTURAL MAL-ADJUSTMENTS IN ECONOMY". IMF used to brainwash countries that their payment difficulties were due to their inability to export on account of domestic inflation, and over-valuation of their currencies. In the name of rectifying this structural disequilibrium, India like other countries borrowing from IMF, was forced to devalue its Currency Indian Rupee many times.

For the benefit of those who are not familiar with Structural Disequilibrium: This theory survives on a belief that domestic inflation makes the exports of the country un-competitive, and that countries have to slash their budget deficits, remove subsidies, so as to control domestic inflation. But India's inflation is caused more by population growth and blackmarketing bazars, rather than by deficit budgets, though theoretically deficit budgets, and higher domestic interest rates, can also contribute to domestic inflation.

In reality, Structural Disequilibrium may be one of the reasons for India's weakness to raise its exports, there were other stronger reasons for stagnation of Indian exports such as the games played by the United States and the Western Europe, competition among agricultural, mining, and other primary goods exporting countries to capture the markets of the Developed countries.

Then, the next stage came. India started borrowing short term loans at Commercial Rates of interest, from international markets. This despite knowing that borrowing short term at high rates of interest can be extremely dangerous for a weak economy. India could not avoid it because the Government was under pressure from Private Sector importers who were on a borrowing spree. (Besides, there was also a need to purchase weapons. Yet, I am unable to trace any instance where Indian Public Sector Undertakings borrowed heavily, short-or-medium term, at Commercial Rates.), PSU imports, I can say with confidence, were never for unproductive purposes, unlike private sector imports, which tend to be "fanciful" to serve the tastes of industrialists and celebrities.

Back to 1991:-- The-then Prime Minister of India Mr. Narasimha Rao was a linguist. He was an intellectual. He had a reputation of knowing 18 languages. I had the fortune of reading one of his Telugu-to-Hindi translation of the voluminous Telugu Novel 'vEyi paDagalu' (English: A thousand hoods of a Divine-Serpant), with the title "sahasra phaN". He was well-known for his stiff-lips and mummy like silences. Even silence was regarded as "decision-making" in his days. May be true sometimes. Mr. Narendra Modi, now, partly emulates.

Difference between Mr. Modi and Mr. Narasimha Rao, with regard to silence:

Mr. Narasimha Rao, was by his very nature a calm and silent person.

Mr. Modi, by his nature, a flamboyant person, but maintains silence, when it is not politically convenient for him to speak. It is a sort of cunningness. Anyway, like Mr. Narasimha Rao, Mr. Modi too may not know much about the intricacies of Exchange Rate Management, External Debt Management. Mr. Modi shouts at the top of his voice, when he believes that it brings him some claps, some Face Book likes, Twitter likes, and of course, thousands of votes.

Whenever, I get a few minutes time to ponder over or muse, I pray the non-existing God, that he will please motivate Mr. Narendra Modi to spend a few minutes every day, on studies of Internatinal Economics, Balance of Trade Management, Balance of Payment Management, Devaluation of Rupee, Exchange Rate Management by RBI, Exchange Reserve Management by RBI. Reason: A PM cannot totally abandon these things to the Finance Minister, Finance Secretary and the RBI Governor. PMs can delegate the tasks of posturing for Selfies to others who have less serious work to attend to.

On the other hand Mr. Narasimha Rao was scholarly (at least superficially). It is difficult to compare great persons. I always wondered, if Mr. Narasimha Rao were a true scholar, he would not have remained so long like a slave in a dynastic Party like Congress, till Ms. Sonia Gandhi virtually drove him out. After all, there is a maxim that Politics is the last resort for scoundrels. Not that Mr. Narasimha Rao was scoundrel, but politics whether it is a place for scoundrels or not, it cannot be a place for scholars. There was a Rs. 133 crore (1.3 billion) Urea Import Advance Payment Scam for which no goods entered into India during Mr. Narasimha Rao's tenure, and there were allegations that his sons were linked to it. There were some other allegations against him such as Purchase of Parliament Members, which do not add to his stature as a Scholar-Politician.

We can take another example of a scholar-like person , Mr. Veerappa Moily. He is reported to have written a commentary on Valmiki Ramayana. I envied his erudition and hard work. But, later some allegations came out that Mr. Moily plagiarised parts of his books. I am too small to comment on this.

Considering Late Mr. Narasimha Rao as a Linguist, I was never able to convince myself that Indian Economic Reforms were an offshoot of his brain-wave. For his Crisis Management of the Payment Crisis, he seems to have depended on Mr. Manmohan Singh for guidance. Hence, the credit or notoriety for introducing Economic Reforms should go to Mr. Manmohan Singh. This curse of mine of his starting the Dynasty of Frog-Kings, should rightly go to Mr. Manmohan Singh. The dynasty is continuing along the lines of the Finance Ministers of India, right upto Mr. Arun Jaitley.

Now, the King of the Frogs story:- In a Frogs Kingdom, there used to be a King. Near the kingdom, there used to be a snake. Hunting a frog everyday for its food, the snake thought laborious. The snake worked out a plot in its mind, went to the frog and volunteered to carry it over its shoulders. Without any foresight, the frog-king accepted the joy-rides on the back of the snake. Not only did the frog rode on the back of the snake, it also invited its queens, princes, and princesses. to share the joy-ride. After a few days, the snake started pretending to be weak, unable to move. Finding the snake sick, the frog-king asked for reasons. The snake replied "As I was carrying you all the time, I could not get gather food, and I am suffering from hunger and malnutrition. The frog-king took kindly to the snake, and permitted to catch and eat one frog per day in his kingdom.

The snake initially for a few weeks, adhered to the ond-frog-a-day limit. Later, the snake, without the knowledge of the frog-king surreptitiously devoured many frogs every day, of course, without touching the King, Queens, Princes, and the Princesses.

After all the frogs are finished, the snake swallowed the King-frog, Queens, Prince, and Princesses also.

India has a peculiar quality which very few Nations around the Globe have. That is: Indian refuses to learn from history. In 1498, King of Calicut Jamorin permitted Vasco De Gama to raise a Camp on Kerala Coast. Vijayanagara Kings bought horses from the Portueguese and permitted them to occupy Goa. Around 1605 CE, Mogul Emperor Jagangir tempted by the British Traders, permitted them to build a Warehouse at Surat. Shajahan and Aurangzeb to followed suit. Vijayanagara-Chandragiri King Venkatapati Rayalu permitted British to build St. George Fort at Chennai. While the joy rides were continuing, the Europeans occupied India. Rest is history.

The same story started again in 1991. In the name of Economic Reforms, LPG (Liberalisation, Privatisation, Globalisation), Government of India opened up its gates to reckless imports, and foreign investments. Govt. lands were distributed gratis, or at throwaway prices, or on long term lease to the MNCs in the name of Special Economic Zones, etc. Tax concessions and waivers were allowed. Customs and Excise Duties were slashed. FERA Foreign Exchange Regulation Act 1973 was substituted by FEMA, Foreign Exchange Management Act.

Earlier when the Govt. contracted external debt, it was not expected to give tax concessions or lift import gates. Today, in spite of numerous tax concessions, slashing of import duties, foreign investments are not forthcoming at the expected scale. Promoters of some Corporate bodies window-dressed their balance-sheets, made false claims of their production, sales and profits, and lured foreign investors to purchase their worthless shares at high prices. Computer algorithms used by foreign institutional investor consultant firms know little about the factual positions prevailing in factories, and they know only figures and data which were cooked up by promoters of Companies. Thus while gullible foreign investors invested in useless Companies, intelligent foreign institutional investors cornered Companies which have huge real estates and lands.

Today, if somebody takes pains, to compile actual field level data, consolidate them and present on their website, we can know the extent to which India has been colonialised by the European and American Companies. Though they may not be participating directly in the Management of the Companies in which they hold substantial shareholdings, they may have already started influencing the purchase and investment decisions of those Companies.

In India, in respect of widely held Companies, where there will be hundreds of thousands of small shareholders spread all over the vast country, a foreign investor who just holds only 20% of shares of a Company can take over management of the Company, with or without the concurrence of the promoters of the Company who were the Indian collaborators of the foreign investors.

Question: How a Foreign Institutional Investor, or even a Foreign Individual Investor, holding a sizable bunch of shares in a Company can influence its purchase decisions?

Answer: We shall take up the case of an Automobile Company. When the Indian Company had no foreign shareholdings, it could procure bulk of its raw material and component requirements locally within the country. Now, the Foreign Institutional Investor with sizable share holdings can arm-twist the Board of Directors / Promoters to import raw materials, components from abroad at exhorbitant prices, or paying royalties. The Foreign Institutional Investor can also influence Marketing and Export decisions of the Company, and tune them to the foreign body's advantage.

While India now makes a facade of having got out of external debt trap, because it could building substantial foreign exchange reserves received through inward foreign investments, the country is caught in a Foreign Investment Trap. In this Foreign Investment Trap, the country has to continuously mobilise foreign investments, if it is to maintain its equilibrium. Reason: India neglected its Balance of Trade Adversity. India faces an extremely dangerous balance of trade deficit. India's exports, particularly exports from Manufacturing Sector are not rising.

India's agricultural exports cannot be depended upon for their consistency. Reason: Uncertainties of monsoons. Domestic shortages owing to uncontrolled population growth. More mouths to feed. Productive Agricultural lands are being converted into vacant house sites, on which neither cultivation takes place, nor houses built.

We neglected , and are neglecting our cottage and small scale industries, which used to shoulder most of our export targets. Large Industrial Houses, experience shows, have very poor export performance. On the other hand, they guzzle our foreign exchange resources through reckless imports. They are like Miss India, Miss Asia, Miss Universe, Miss World Title Holders. They are good for nothing, except as show pieces. Our saviors were always cottage, small scale, tiny and medium industries, whom we treat as cinderella.

In spite of my best efforts, my blog posts are being pulled towards more religious matters, whereas I intend to write more on our ECONOMICS and FINANCE. They are the top priority not only of India, but also of the World. However, I shall complete the ten parts series I have undertaken to write about the review of the Lecture of Shri V.V. Lakshmi Narayana, Additional A.D.G.P. Maharashtra, and the Former CBI JD, Hyderabad, about producing hundreds / thousands / hundreds of thousands of Swami Vivekananda-s in India. Then, we have to write a 100 posts about Indian Judicial Systems and Practices. Are our hands are not full?

Subject to corrections and deletions. To continue. सशेष. ఇంకా ఉంది.