Industrial growth slows to 4.4% in March

Industrial output growth slowed to a five-month low in March due to sluggish manufacturing, mining and capital goods performance, posing a challenge for policymakers to push growth in the key sectors.

The index of industrial production rose an annual 4.4% in March, slower than previous month’s downwardly revised 7% expansion and similar to 4.4% growth in the same month last year. Industrial growth for 2017-18 stood at 4.3%, lower than 4.6% posted in the previous year. “Core sectors have been consistently losing steam. Growth in the economy’s eight core sectors, which make up about 40% of total industrial production, slowed to 4.1% in March, from 5.3% in February and 6.1% in January. Growth in the non-core sectors too slipped during the month. Separately, trade data reported a slowdown in non-oil exports in March. That said, an unfavourable base effect was also behind the slowdown in IIP growth in March,” ratings agency Crisil said. The RBI is expected to hold interest rates when it reviews monetary policy in June.

Pokhran II: 20 years on....

Twenty years ago, a sudden late-afternoon announcement by then PM Atal Bihari Vajpayee and his national security adviser, Brajesh Mishra, shook the world. On May 11 and 13, India conducted a set of five nuclear tests, setting the country on the road to not merely being a nuclear power, but a country deserving of a space at the global high table.

Rakesh Sood, former diplomat and someone who was involved in the post-nuclear tests diplomacy, said India had three objectives. “First was to validate new designs to ensure credibility of the nuclear deterrent as the data set from the 1974 test was limited. Second was to declare that India was now a nuclear weapon state and modify the terms of our engagement with other states accordingly. Third was to generate an acceptance of India as a responsible state with an impeccable non-proliferation record.”

The nuclear tests announcement was followed closely by a massive global outreach by India, starting with the United States. The first response was outright condemnation from every multilateral platform. But in a counter-intuitive action, then foreign minister Jaswant Singh and US deputy secretary Strobe Talbott began a conversation — that led to a whole new relationship being built between US and India. As Raja Mohan, director Carnegie India says, the tests “were needed to end India’s international isolation. They provided the basis for reconciliation with global nuclear order, and redefined our relationship with the US.”

Former NSA, Shivshankar Menon believes the tests “shook loose our relations with all major powers, US, China, even Pakistan. The world was used to a certain kind of India. That was challenged, successfully.” Former foreign secretary S Jaishankar says the tests created one of the pre-requisites for India’s aspiration to become a leading power. “The actions we took 20 years ago ensured our national security. Our responsible record and subsequent engagements ensured global understanding of our policies. That is also shown by our nuclear collaborations around the world.”

The 1998 nuclear tests began the process for the world to acknowledge India as a responsible nuclear power. It was something Indian strategists said, ad infinitum, from 1974 despite decades of economic and technological sanctions, India remained true to highest NPT standards despite being an NPT outlier. While harmonising with global nuclear order, the tests and their aftermath ironically destroyed the prevalent ‘nuclear superstructure’.

Ironically, with Pakistan, the 1998 tests — Pakistan followed soon after — gave Islamabad-Rawalpindi a sense of a ‘threshold’ below which they could continue to wage a proxy war, most spectacularly during Kargil. Since then, Pakistan has taken a riskier path, developing tactical nuclear weapons, while India separated its civil and military programmes and put a nuclear doctrine in place.

Two decades on, Pokhran-II culminated in India-US nuclear deal, membership of three of four global non-proliferation regimes and a waiver from NSG, doors that had been closed to India.

PM plays Ramayana card in Nepal

Connectivity and faith came together in some high-voltage neighbourhood diplomacy as PM Narendra Modi and his Nepal counterpart KP Oli drew a tourism circuit with Ramayana as the dominant theme. The two leaders inaugurated a bus service between Janakpur, considered in Hindu mythology as Goddess Sita’s ‘maika’ (parent’s place), and her ‘sasural’ (in-laws’ place), Ayodhya.

The Ramayana theme played well with Modi’s own politics. “Without Nepal, India’s faith is incomplete. Without Nepal, India’s history is incomplete. Without Nepal, India’s dhams (temples) are incomplete. Without Nepal, our Ram is incomplete,” Modi said while inaugurating the Janakpur-Ayodhya bus service.

Modi’s two-day visit to Nepal — his third as PM — touched strong points of faith as he offered prayers at Janaki temple, Pashupatinath and Muktinath. A subterranean message to the communist leadership at the helm of Nepal’s affairs was that despite their avowed affinity for communist Beijing, the people of Nepal based their faith on common gods with India. It was a powerful message which did not need to be articulated but was clear when Oli watched Modi pray, but refrained from joining in.

At a civic reception here, Modi quoted a verse from ‘Ramcharitmanas’ on helping a friend in the time of suffering to emphasise the ties between the two nations. “Whenever there has been a problem, India and Nepal have stood together. We have been there for each other in the most difficult of times,” the PM said, stressing Nepal’s top position in India’s ‘Neighbourhood First’ policy.

Modi, who became the first Indian PM to perform 16-step puja at Goddess Sita’s Janaki temple here, also announced Rs.100-cr package to develop Janakpur. To a loud applause, he said he had come to Janakpur not as a PM, but a pilgrim.

KCR plonks himself on front pages

Saffron saw red when it saw pink splashed on front pages of newspapers across the country on Thursday morning, not just in English and Hindi, but many regional languages too. It was TRS president and Telangana chief minister K Chandrashekar Rao’s way of announcing his arrival on the national political scene.

The morning after, there, he was – practically declaring himself as the ‘man of the moment’ and subtly as someone the country had looked up to – for leadership. The advertisements in newspapers, including several regional languages, said it all.

Arguably, it is the first of such a scheme in the country, if not in the world, and KCR wanted the world to know it. The information hit them on their faces when front page advertisements declared the big idea he was implementing for farmers. Touted as the ‘never seen before farmers welfare innovations in the history of India’, the advertisements explained about the ₹8,000 per acre for farmers as investment support scheme and new pattadar pass books after the ‘cleansing of land records’.

Rival political parties have not been able to digest his ‘frontal attack’. The Bharatiya Janata Party’s Telangana state unit described the advertisements in other states as misuse of public money. IT and municipal administration minister K T Rama Rao retweeted BJP Telangana’s twitter comment with a response asking: “BJP folks seem worried that there may be a demand to replicate and implement Rythu Bandhu scheme in their states?” Congress spokesperson Sravan Dasoju too commented about the publicity blitzkrieg and condemned it. “Absurd misuse of hard-earned tax payers money by the Telangana chief minister for self-propaganda and emerge as a national leader,” he commented.

Clearly, KCR announcing himself on the national scene with a unique scheme made him the talking point. Trinamool Congress leader and West Bengal chief minister Mamata Banjeree whom KCR met, has herself been taking initiatives to meet leaders of various parties to form a non-BJP front. Andhra Pradesh chief minister N Chandrababu Naidu, who already reached out to various parties in the context of AP not being granted special status by the Centre, is playing his cards close to his chest on leading a front of his own. But KCR seems to have stolen the thunder –at least for now.

IGI’s T1 to get metro link

The Kalkaji Mandir-to-Janakpuri West section of Delhi Metro’s Magenta Line is likely to be opened for use next week.

A 12.6-km section of the corridor between Botanical Garden in Noida and Kalkaji Mandir was inaugurated in December last year. The remaining section, when opened, will put Vasant Vihar, Munirka, Indian Institute of Technology, Greater Kailash, Chirag Dilli and other localities in south Delhi on the Delhi Metro map and bring this region of the capital closer to Noida and west Delhi. The domestic terminal of the Indira Gandhi International Airport will also get a metro link for the first time.

The Hauz Khas metro station will become an interchange station and provide inter-connectivity for the Yellow Line (HUDA City Centre-Samaypur Badli) and Magenta Line. Through this connectivity, the travelling time between Gurgaon and Noida will be brought down by at least half an hour to around 50 minutes.

The Janakpuri West station on the Blue Line (Dwarka-Noida/Vaishali) will similarly become an interchange station and provide additional access to areas in south Delhi and Noida from west Delhi. The interchange will take place at the first station of the new Phase 3 corridor and will connect the Blue Line with, among other, Terminal 1 of IGIA, Munirka, Hauz Khas, Nehru Place and Botanical Garden in Noida.

For lakhs of west Delhi residents, their one connection to the rest of the city is the Blue Line, but this involves travelling up to Rajiv Chowk and changing trains if they are to visit other parts of Delhi-NCR. This will change because the new corridor will pass through and connect heavily populated areas like Palam, Dabri, Mahavir Enclave, Sagarpur and Dashrathpur.

IGIA also become more accessible. While the Airport Express Line has a stop at Terminal 3, there was no metro connectivity for the domestic terminals from which the low-cost operators fly. Now, the domestic terminal can be reached from most parts of the capital and also from Gurgaon and Noida, thanks to the many interchange points that allow changing to the Magenta Line. For passengers coming from south Delhi areas, the journey to the airport will now be of just 20 minutes’ duration, while from other parts of the National Capital Region, the commute could take between 35 and 50 minutes.

While Delhi University got metro connectivity years ago, Jamia Millia Islamia was also put on the metro map last year when the first section of the Magenta Line opened. With the opening of the second section of the line, Delhi Metro would also come close to Jawaharlal Nehru University with a station at Munirka, a stone’s throw away. The Indian Institute of Technology, on the other hand, is getting a station named after it right next to the campus.

Of Powerful People....

Prime Minister Narendra Modi has been ranked among the top 10 most powerful people in the world by Forbes in a list that has been topped for the first time ever by Chinese President Xi Jinping, who dethroned Russian President Vladimir Putin as the most influential person on the planet.

Modi ranks 9th on the Forbes 2018 list of 75 of the World’s Most Powerful People who make the world turn. “There are nearly 7.5 billion humans on planet Earth, but these 75 men and women make the world turn. Forbes’ annual ranking of The World’s Most Powerful People identifies one person out of every 100 million whose actions mean the most,” Forbes said.

Modi, 67, is ahead of Facebook CEO Mark Zuckerberg (ranked 13), United Kingdom Prime Minister Theresa May (14), Chinese Premier Li Keqiang (15) and Apple CEO Tim Cook (24).

Reliance Industries Chairman Mukesh Ambani, with a net worth of $41.2 billion, is the only other Indian on the power list, ranking 32nd. Microsoft’s India-born CEO Satya Nadella is on the 40th spot.

Forbes said Modi “remains hugely popular” in the second most populous country on earth. It cited Modi government’s November 2016 decision to eliminate India’s two largest banknotes in a bid to reduce money laundering and corruption.

“Modi has raised his profile as a global leader in recent years during official visits with US President Donald Trump and Xi Jinping. He has also emerged as a key figure in the international effort to tackle climate change, as warming affects millions of his country’s rural citizens,” Forbes said.

On Ambani, Forbes said the billionaire industrialist’s Reliance sparked a price war in India’s hyper-competitive telecom market with the launch of 4G phone service Jio in 2016.

Walmart buys 77% of Flipkart

Walmart has agreed to pay $16 billion for a roughly 77 per cent stake in India’s largest online shopping site Flipkart, the US retailer’s biggest foreign investment as it battles rival Amazon.com in one of the world’s biggest emerging markets.

The deal, capping almost two years of talks, will help the Bentonville, Arkansas-based retailer fortify and boost market share against Amazon.com, which reportedly had tried to make a competing offer for a stake.

“India is one of the most attractive retail markets in the world, given its size and growth rate, and our investment is an opportunity to partner with the company that is leading transformation of e-commerce in the market,” said Doug McMillon, Walmart’s chief executive officer in a statement.

Buying a stake in Flipkart, which sells everything from soaps to smartphones and from books to clothes, gives Walmart access to the fledgling Indian e-commerce market that could potentially be worth $200 billion in a decade, according to Morgan Stanley.

Walmart said it plans to fund the deal through a combination of newly-issued debt and cash on hand.

The remainder of the business will be held by some of Flipkart’s existing shareholders, including Flipkart co-founder Binny Bansal, China’s Tencent Holdings, Tiger Global Management and Microsoft, the company said.

Google’s parent company Alphabet is also expected to purchase a small stake, possibly around 10 per cent, reports said, citing unnamed sources familiar with the matter.

Earlier on Wednesday, SoftBank chief executive officer Masayoshi Son unexpectedly spilled the beans on the deal by confirming on a conference call that Walmart had decided to purchase Flipkart, ahead of the highly-anticipated official announcement.

Son said his firm’s investment in the Indian online retailer had grown to $4 billion. Soft-Bank’s Vision Fund, the world’s biggest private equity fund, had invested $2.5 billion in Flipkart last August.

Amazon boss Jeff Bezos has committed more than $5 billion to grabbing a big slice of India’s ecommerce pie after failing to make inroads in China.

E-commerce sales in India hit $21 billion last year according to market research company Forrester, and are expected to soar as its population of 1.25 billion people make greater use of internet access.

Flipkart was founded in 2007 by former Amazon employees Sachin Bansal and Binny Bansal, who are not related. Like Amazon, it started as an online bookstore.

Before the deal, Flipkart co-founders Binny and Sachin Bansal each owned about 5 per cent, according to a Bloomberg analysis of the company’s annual return filed in Singapore. Sachin Bansal will sell his entire stake to Walmart while Binny Bansal will sell part of his to the American retailer, The Economic Times reported on Tuesday.

The deal should give each a fortune of about $1 billion, although that status may be short-lived as the pair may have to pay 20 per cent capital gains tax on any shares they sell in the company, tax experts say.

The pair have been billionaires before. Flipkart was valued at $16 billion in 2015, giving each Bansal a $1 billion stake at the time thanks to the 7.5 per cent they each held. They lost that status as the firm’s valuation subsequently dipped. It was valued at about $12 billion last year, according to researcher CB Insights.

Walmart’s Walton family can afford to pay a premium for Flipkart. The combined net worth of Alice, Jim, Rob, Lukas and Christy Walton is $146 billion, according to the Bloomberg ranking.