Archive for ‘Economics’

06/08/2014

China Investigates Microsoft, Symantec – Businessweek

For years, U.S. politicians have been calling Chinese telecom-equipment makers Huawei Technologies and ZTE (000063:CH)threats to American security. But making charges about national security is a game that China can play, too. Following Edward Snowden’s disclosures of U.S. spying, the Chinese government seems eager to show American companies that they will pay a price for U.S. government actions.

Why China Is Investigating Microsoft and Symantec

That’s a lesson that Microsoft (MSFT) and Symantec (SYMC) are learning now. An antivirus company from Silicon Valley, Symantec competes in China against local favorites such as Beijing-based Qihoo 360 Technology (QIHU). According to reports by Bloomberg News and the Chinese media, China has instructed government departments to stop buying antivirus software by Symantec and its Moscow-based rival, Kaspersky Lab. Symantec software has back doors that could allow outside access, according to an order from the Public Security Ministry. Not coincidentally, Qihoo’s New York-traded shares rose 2.7 percent on Monday, following reports of the move against Symantec and Kaspersky.

Symantec is trying to contain the damage. Although the official People’s Daily newspaper reported on Sunday that the government had banned both Symantec and Kapersky, Cupertino (Calif.)-based Symantec says the action is more limited. “It is important to note that this list is only for certain types of procurement and Symantec products are not banned by the Chinese government,” the China Daily reported Symantec commenting in a statement. “We are investigating this report and will continue to bid for and win government projects in China.”

via China Investigates Microsoft, Symantec – Businessweek.

06/08/2014

Insurance Bill Struggle Pokes Another Hole in the Notion of Modi Magic – India Real Time – WSJ

The new government in New Delhi is struggling this week to get an insurance-industry liberalization bill— an important part of its campaign to revamp the economy—to the floor of the upper house of Parliament.

Opening up the insurance business to more foreign investment was one of the main deregulation measures unveiled in Prime Minister Narendra Modi’s first budget last month.

But already it is bogged down. Mr. Modi’s Bharatiya Janata Party does not control the upper house and other parties want to stall a vote on the bill.

The legislative tussle is a sign of the challenges Mr. Modi faces, despite his party’s landslide electoral victory and the BJP’s lower-house majority, as he tries to push through even modest changes in the way India manages its economy.

Mr. Modi swept to power this spring on a surge of anti-incumbency sentiment and hope that the BJP could break the policy deadlock in the capital. Supporters expected Mr. Modi bring the “achche din,” or good days, back to Asia’s third-largest economy.

But India’s complicated national politics, its decentralized federal system and Mr. Modi’s own desire not to get too far ahead of public opinion in a country long used to large-scale welfare schemes and a heavy state hand in the economy, is likely to slow any change.

The new administration’s national budget, announced in July, was bland and disappointing to many. It did not include the kind of big-bang reforms many optimists had anticipated.

In response to criticism of the budget, India’s new Finance Minister Arun Jaitley told a television news channel that the government is waiting for the right time to implement some changes.

“You don’t do reforms in a manner that the political system is unwilling to accept them,” Mr. Jaitley said during a July interview on Headlines Today. “The more challenging ones, you go on that course in times to come.”

Last week, Mr. Modi’s government blocked an important trade agreement that all 160 members of the World Trade Organization—including India—had agreed to in December. India demanding more freedom ratchet up market-distorting food subsidies.

“This is an inauspicious start for the new Modi government,” said Orrin Hatch, a Republican U.S. senator from Utah and member of the Senate Finance Committee in response to India’s decision.

M. J. Akbar, a BJP spokesman, says the party is happy with its progress. He said the government has focused on dealing with inflation, encouraging growth and reaching out to neighboring countries.

“On the insurance bill, the government has shown complete firmness in pushing it through,” and will use a joint-session of Parliament to vote on it if the upper house refuses, he said.

Still, the gradual deflation of the Modi bubble can be seen in the stock and currency markets. The benchmark Sensex index, has basically been going sideways for the last two months, after a sharp run up as the scale of Mr. Modi’s election win became clear.

The rupee has also been giving up some of this year’s gains against the dollar.

Of course the less excitable analysts and executives have always said the complexity of running the world’s largest democracy means that decision making will remain a slow and often painful process, even with a majority in the lower house of Parliament.

Many of the biggest challenges to improving the lives for India’s 1.2 billion citizens—such as reducing corruption, building modern infrastructure and providing hundreds of millions of good jobs–will take years, if not decades, surmount, even with the right policies and a charismatic leader.

“If a handful of people decide that (the progress so far) is insufficient, we have to ignore them and recognize that the majority of India is both relieved that the return of governance as well as the return of hope,” said the BJP’s Mr. Akbar. “Files are being cleared after ages of stagnation.”

–Prasanta Sahu contributed to this story.

via Insurance Bill Struggle Pokes Another Hole in the Notion of Modi Magic – India Real Time – WSJ.

06/08/2014

Key questions that have been lost in the din of protests against the civil services exam

In the midst of protests against the new format of the civil services examination, several key issues have gone unaddressed. An opportunity for meaningful debate about the exam has quickly turned into a slanging match.

The matter has assumed an unnecessarily adversarial tone, with English pitted against other Indian languages. But the issues are far more complex and far less binary than politicians believe. Here are some key questions that have got lost in the din.

Should the Civil Services Aptitude Test be scrapped altogether?

The answer is a clear no. The CSAT gauges logical reasoning, problem-solving skills, analytical abilities, basic numeracy and English proficiency up to class 10 level. To argue that an administrator can do without any of these skills is unrealistic. An administrator has to deal with huge amounts of quantitative and qualitative information and any deficiency in these skills would mean a sub-par performance on the job.

Does the CSAT discriminate against students doing the exam in Hindi or regional languages?

No, but it does employ very poor translation software. The Union Public Service Commission, which conducts the exam, must acquire competent translators or purchase translation software that is up to the mark. This should do the trick.

Is there a grain of truth in what the protestors are alleging?

At the heart of the uproar lies the allegation that the exam is biased towards those who take the exam in English. Since the revised format came into force in 2011, the number of students who take the exam in Hindi has steadily fallen. (However, to really judge whether this is significant, one would have to look not at the absolute numbers of successful candidates who do the exam in Hindi, but the percentage of such candidates out of all those who take the exam in Hindi. But data about the number of test takers in each language is not available).

There may be a kernel of truth to this claim. But the blame lies to a large extent with the coaching and publishing industry. There is simply not enough study material available in Hindi and other regional languages. It is this paucity of study material that hurts students from vernacular backgrounds in the long run.

Surely, pelting stones and burning vehicles is not acceptable behaviour?

Some protestors, by resorting to violence, have demonstrated their unsuitability for the job. It is safe to say that many students have spent hundreds of hours preparing for the exam in its current format. What about their efforts? Do they count for nothing? By taking to the streets and letting political players into the mix, the protestors have probably done more harm than good.

Does the civil services exam in its current format select the best and the brightest?

Opinions differ considerably. An IAS probationer who did not want to be named told this writer: “The civil service exams, in its existing format, put less emphasis on rote learning and that is a good thing. The less this examination focuses on retention of information, the better.”

The civil services exam in its current format has three key components. The prelims, the mains and the interview. The first stage of the exam is the prelims, which has two parts, of which the second is the dreaded CSAT. As argued earlier, however, the CSAT is essential for ensuring that only candidates who possess minimum competencies and skill sets make it through to the far more difficult second round, the mains.

The Union Public Service Commission, with its recent revision in format for the mains, has reduced much of the burden on students. Earlier, a student had to master two subjects of their choice (neither of which he or she may have studied before). But now a student just has to choose just one subject of his or her choice. By emphasising general studies and critical thinking, the UPSC has levelled the playing field to a large degree.

How about allowing lateral entry?

The UPSC could also perhaps increase the number of vacancies in the civil services. It is a fact that we don’t have enough administrators for the population. According to various media reports, Right to Information applications and 2011 census figures, India has slightly more than 1,600 government servants for every 100,000 residents, which many studies say is a low ratio.

If quality of candidates is an issue, then the UPSC could look into the lateral entry of specialists, and even pay them market wages, a system used in the developed world. India’s political establishment must separate policy functions from service delivery and stop interference in operational matters. Simultaneously, the political class must establish uniform standards and guidelines across the country.

via Scroll.in – News. Politics. Culture..

05/08/2014

Ex-Panbassadors enjoy homeland[1]- Chinadaily.com.cn

Giant pandas born overseas learn to adapt back in China, reports Huang Zhiling in Dujiangyan, Sichuan province.

Ex-Panbassadors enjoy homeland

At the foot of Mount Qingcheng in Dujiangyan, Sichuan province, a Chinese keeper speaks to giant panda Tai Shan in its den.

Welcome home, Tai Shan  They are using English to communicate.

The 9-year-old male panda charmed millions of Americans during his stay at the Smithsonian’s National Zoo in Washington DC for four and a half years.

Since his return to China in February 2010, Tai Shan has lived in the two bases of the China Conservation and Research Center for the Giant Panda.

The center designated a keeper who is proficient in English to take care of Tai Shan because his US keeper Nicole Meese had communicated with him when he was just 1 month old. Tai Shan has not yet learned the southwestern Sichuan dialect.

“Tai Shan is one of the center’s nine pandas born overseas and returned to the base,” said Wang Yongyao, an official with the administrative bureau of the Wolong National Nature Reserve, which oversees the center.

The male bear is one of a special group of China’s giant pandas that have to adapt back home after being born overseas.

The center is the world’s largest giant panda conservation and research organization. It started loaning pandas to other countries and regions in 1996. Its pandas have given birth to a total of 12 cubs overseas since.

Under an agreement for global giant panda preservation, giant pandas born overseas belong to China and must be returned to the country after they turn 2.

China agreed to extend Tai Shan’s loan to the US because of the bear’s huge popularity there.

A pair of adult pandas can also be loaned overseas for 10 years under an agreement between China and the host.

“Everyone loves pandas and they are like citizens and residents of their host country or region. China is also often asked to extend the loan of the bears,” said Zhang Hemin, chief of the administrative bureau of the Wolong National Nature Reserve.

“As a result, only their cubs born overseas have returned home.”

Of the 12 cubs born overseas, only three aged under 2 have yet to return home. The other nine bears live in the Dujiangyan and Ya’an bases in Sichuan.

via Ex-Panbassadors enjoy homeland[1]- Chinadaily.com.cn.

05/08/2014

Seaplane about to enter trial production – China – Chinadaily.com.cn

China expects to test-fly next year its first domestically developed seaplane, which is intended to be the world’s largest amphibious aircraft, according to an executive at the company working on it.

Seaplane about to enter trial production

Trial production of the TA-600 aircraft, formerly known as Dragon-600, will start in Zhuhai, Guangdong province, around the end of this year or the beginning of 2015, as the design has been completed, said Fu Junxu, a senior manager of China Aviation Industry General Aircraft, a subsidiary of Aviation Industry Corp of China, the country’s leading aircraft maker.

Fu said contractors will deliver large parts to the company before the end of this year, and the aircraft’s maiden flight is planned to take place in 2015.

The aircraft, with a maximum takeoff weight of 53.5 metric tons and a maximum range of more than 5,000 kilometers, will be larger than a Boeing 737 and could be used for a variety of operations such as passenger transport, marine environmental monitoring, firefighting and maritime search and rescue, Fu said.

Powered by four turbine engines, the TA-600 will be the world’s largest amphibious aircraft, surpassing Japan’s Shin Maywa US-2. It is designed to carry up to 50 people during search and rescue missions.

The company’s market research estimates there is demand for 60 of the seaplanes in China.

The country began developing the aircraft five years ago, Fu said.

Wang Ya‘nan, deputy editor-in-chief of Aerospace Knowledge magazine, said the TA-600 would fill a vacancy of modern seaplanes in China, which has long ignored the development of such aircraft.

“The old saying ‘A thousand days the country nurtures its soldiers and all for one day’s battle’ applies to the development of amphibious aircraft. People say such equipment is becoming useless, but will eventually realize they are indispensable in maritime operations,” Wang said, referring to the continuing search for the missing Malaysia Airlines flight MH370.

“If the Chinese navy had such large, modern seaplanes as the TA-600, it would be much easier for it to search at sea,” he said.

Rescue agencies are among the largest operators of seaplanes due to their efficiency and their ability to both locate and rescue survivors of emergencies at sea. Land-based aircraft cannot rescue people, and many helicopters are limited in their capacity to carry passengers and in their fuel efficiency compared to fixed-wing aircraft, Wang said.

China now has at most five SH-5 maritime patrol amphibious aircraft, which are old and cannot perform modern maritime tasks, Wang added.

via Seaplane about to enter trial production – China – Chinadaily.com.cn.

05/08/2014

India central bank cautiously optimistic on growth – Businessweek

RBI head office, Delhi

RBI head office, Delhi (Photo credit: Wikipedia)

India’s central bank said Tuesday it sees signs of recovery in Asia’s third-largest economy even though the monsoon season, which is crucial for agriculture, had a weak start.

The Reserve Bank of India left its key interest rate unchanged at 8 percent Tuesday, maintaining a tough stance against stubbornly high inflation. It has faced calls to cut interest rates to help revive flagging growth.

“Domestic economic activity appears to be reviving, with incoming data suggesting a firming up of industrial growth and exports,” RBI Gov. Raghuram Rajan said in a statement.

The central bank remains on guard against inflation partly because of the slow start to the monsoon, which could drive up food costs, hurting the hundreds of millions of poor Indians who live on less than $2 per day.

Wholesale inflation eased to 5.4 percent in June.

“We are not against growth,” Rajan told reporters in a press briefing. But he said growth should be beneficial, not a short-lived mini-boom engineered by easy monetary policy.

via India central bank cautiously optimistic on growth – Businessweek.

05/08/2014

Samsung Loses Top Spot to Micromax in India – India Real Time – WSJ

Samsung Electronics Co.005930.SE -0.08% was dethroned as the top cellphone seller in India last quarter as local rival, Micromax Informatics Ltd., undercut and outsold the Korean company for the first time in Asia’s third-largest economy.

Micromax which was launched only five years ago, has taken the pole position in the Indian market—the second largest in the world in terms of handset sales—by undercutting the prices of Samsung and other international brands.

In the April-through-June quarter Micromax’s market share reached 17% of the Indian market compared to Samsung’s 14%, according to Counterpoint Technology Market Research, a research and consulting company based in Hong Kong.

Samsung, the world’s largest cellphone company by sales, is facing tough competition from Micromax and other Indian handset sellers. The South Korean company lost its top spot in terms of handset volumes as it has shifted its focus to smartphones and away from the less-expensive feature phones, said Neil Shah an analyst at Counterpoint.

Micromax has been more successful than most at targeting the Indian consumer. In the past five years it has come out of nowhere by investing heavily in advertising, distribution and developing a portfolio of relatively inexpensive handsets for Indians.

Samsung may be trying to claw back some of its market share. The company, last week, added three more smartphones to its “affordable” category of handsets priced below 10,000 rupees.

via Samsung Loses Top Spot to Micromax in India – India Real Time – WSJ.

04/08/2014

For a country obsessed with fair skin, why are so many Indians buying self-tanners?

Market research firm Euromonitor has just released a study on the grooming habits of the world. It has one rather surprising finding – Indians are slathering on massive dollops of tanning lotions. Indians are apparently second only to Chinese in consuming what the researcher calls self-tanning products.

It doesn’t add up.

Indians are the highest consumers of whitening creams, the same survey shows, and that is unsurprising. The country’s problematic preference for fair skin is well known. Fairness cream ads featuring big Bollywood stars are ubiquitous. In 2010, AC Nielsen estimated the size of the market for skin whitening products at $432 million.

But there is not a single well-known brand of skin-tanning lotions in the country.

via Scroll.in – News. Politics. Culture..

02/08/2014

With End of China’s One-Child Policy, There Hasn’t Been a Baby Boom – Businessweek

Last November, China announced the loosening of its restrictive one-child population policy: Couples would soon be permitted to have two children so long as one parent was an only child. Government planners predicted that roughly half of China’s 11 million eligible couples would chose to have a second child within five years, and investors predicted a boom in sales of diapers, baby formula, and educational toys in China.

Why China's Second-Baby Boom Might Not Happen

The policy change has been rolled out in 29 of China’s 33 provinces and regions, yet by the end of May only 271,000 applications for permission to have a second child had been submitted. Many came from older mothers concerned not to lose their chance. At an agency in Beijing’s Tuanjiehu neighborhood that connects parents with maternity nannies, staff said that the majority of requests pertaining to second children came from women in their late 30s.

Six months into the new policy is still too early to judge the ultimate impact. But experts now express more modest expectations. “Every metric thus far indicates the loosening isn’t leading to a baby boom,” says Mei Fong, author of a forthcoming book on China’s population policies. With rising costs of urban living, Chinese couples are deliberately limiting family size for reasons similar to those depressing fertility in Taiwan, Japan, Korea, Singapore, and Western countries.

via With End of China’s One-Child Policy, There Hasn’t Been a Baby Boom – Businessweek.

01/08/2014

China’s Girl Births Ratio Improves as Country Gets More Educated – Businessweek

Priscilla Yang is standing outside Tuanjiehu Beijing Maternity Hospital, her husband dutifully holding aloft a purple umbrella to shield her from the blazing July sun. The 27-year-old is eight months pregnant and feeling relieved: Her latest rounds of prenatal tests came back normal.

Yang doesn’t know, but wonders about, the gender of her child. A college-educated public-relations executive, Yang says she hasn’t tried to wheedle illicit information from the maternity hospital staff. Boy or girl, “both are OK,” she says. “What I care most about is that the baby is healthy.”

Yang’s indifference about gender is becoming more common, though the struggle has been long. It has been illegal in China since 2001 for doctors to reveal the sex of the fetus to expectant parents. When ultrasound technology became widely available in the late 1980s, the number of sex-selective abortions shot up. Traditional Chinese culture prized sons, who performed heavy labor on farms and were expected to inherit land and stay home to care for elderly parents. Daughters left their parents’ household to join their husband’s after marriage. The one-child policy, announced in 1980 and enacted nationally within a few years, only intensified the desire for sons. Even after the 2001 law, many Chinese parents managed to bribe poorly paid doctors to see ultrasound results—then chose to abort female fetuses.

via China’s Girl Births Ratio Improves as Country Gets More Educated – Businessweek.

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