The Russian Triumf system

If fighters like Rafale are meant to take the war to the enemy, the S-400 batteries are designed to prevent the enemy from bringing it to your shores by erecting a defensive shield that can detect, track and destroy hostile strategic bombers, jets, spy planes, missiles and drones at a range of 380 km. India’s move to ink the $5.43 billion (Rs.40,000 crore) deal for five advanced S-400 Triumf surface-to-air missile squadrons from Russia, despite the looming threat of US sanctions, underlines its resolve to bolster air defence coverage along the unresolved borders with China and Pakistan.

The resolve became stronger after China began inducting six S-400 batteries in January under a $3 billion deal inked with Russia in 2014. The US last month imposed financial sanctions on China for its S-400 deal but India is hopeful of getting a waiver from the Trump administration.

India will pay 15% (Rs.6,000 crore) to Russia as the first instalment, with the rest being linked to deliveries. IAF is slated to get the first S-400 missile squadron in 24 months, with its associated battle-management system of command posts and launchers, long-range acquisition and engagement radars, and all-terrain transporter-erector-launcher vehicles. All five squadrons, with two firing units each, will come in 54 months.

The S-400s, with their huge ‘area denial capabilities’, are as much of a game-changer as the Rs.59,000-crore procurement of 36 Rafale fighters from France, which has run into a political dogfight between the BJP and Congress.

If deployed near the border with Pakistan, an S-400 battery can shoot down a hostile F-16 fighter or cruise missile much before it comes near Indian airspace during hostilities.

Russia contends the S-400, designated the ‘SA-21 Growler’ by NATO, can even “radar lock and shoot down” 5th-Gen stealth fighters like American F-35 jets. It’s no wonder the US is against proliferation of the S-400s, and has tasked its latest F-22A ‘Raptors’ and other top-notch weapons with defeating the Russian system in case of a conflict.

It was in October 2015 that India had kicked off plans to acquire the S-400 missile system, and that the Cabinet Committee on Security on September 26 had cleared the deal for inking. The S-400 contract is among the largest-ever defence deals inked with Russia. The other big deals include the ones for 272 Sukhoi-30MKI fighters (over $12 billion) and INS Vikramaditya ($2.33 billion for the aircraft carrier and another $2 billion for 45 MiG-29Ks to operate from its deck).

Konkan Alphonso, king of mangoes, gets GI tag

The Alphonso mango from Ratnagiri, Sindhudurg and adjoining areas of Konkan region in Maharashtra has finally got the Geographical Indication tag — an exclusive label used for products that have a specific geographical origin and possess qualities or reputation that are due to that origin.

Called the king of mangoes, Alphonso—it is also known as Hapus in Maharashtra—is prized in the domestic and international markets for its taste, fragrance and vibrant colour. It has long been one of the world’s most popular fruits and is exported to various countries including Japan, Korea and Europe.

The first product to get a GI tag in India was Darjeeling tea in 2004. There are 325 products from India that carry this indication. Mahabaleshwar strawberry, blue pottery of Jaipur, Banarasi sarees, rosogolla of West Bengal, Madhubani paintings of Bihar, Mysore silk of Karnataka and Tirupati laddus are some products with GI tag.

There was a long drawn fight between organisations from Sindhudurg and Ratnagiri seeking separate GI tags for mangoes from their region, but in April, they decided to bury their differences and put up a joint application after the registry of GI, Mumbai, rejected individual applications filed by four producers of Alphonso mangoes in Konkan to patent their produce as Hapus. The petitioners were Dapoli university, Kokan Hapus Udpadak Sangh, Ratnagiri Hapus Udpadak Sangh, and Devgargh Hapus Udpadak Sangh.

After hearing the applications, the controller of patent, design, and trademark, Om Prakash Gupta, suggested that instead of GI tagging separate names, all mangoes from Konkan will get the ‘Hapus’ tag after the applicants submit a fresh application.

India @ 100

The Union government will shortly unveil a development plan to make India the world’s third largest economy after the US and China by 2047, when the country celebrates its 100th year of Independence. “We are coming out with a new strategy document, ‘New India at 75’. It starts off by saying that India must aim for and can become the third-largest economy by 2047 and then we go on to break it down to steps to achieve this goal,” Rajiv Kumar, vice chairman of federal policy think tank Niti Aayog.

Although the goal is set for 2047, Kumar said the government will strive to reach the landmark much ahead of the timeline.

Efforts have been underway since the 12th five year plan ended in 2017 to have a comprehensive development plan in which states will play a dominant role.

The blueprint will suggest ways to attain less carbon-intensive and more technology-driven growth, while also narrowing income inequality. The plan will come ahead of the national polls early next year and showcase Prime Minister Narendra Modi’s idea of laying the foundation for a new India.

India overtook France to become the world’s sixth-largest economy in 2017, according to the World Bank’s updated figures published in July. India is now a $2.597 trillion economy, just above France’s $2.582 trillion. Japan, Germany and the UK occupy the third, fourth and fifth places. India’s economy is expected to overtake UK’s next year.

However, due to its large population, India lags developed economies in terms of per-capita income. The country’s per-capita GDP is a fraction of that of France, which is still roughly 20 times higher, according to the World Bank.

State governments and central ministries have given detailed suggestions for the new plan, which will set out targets and reform measures for various governments.

Kumar said the goals, as well as the measures, reforms and policies, needed to achieve the target will be spelt out in the document.

He said the average fertility rate in several states is either less than or equal to the replacement rate of 2.1 (children per woman) and, therefore, is not a big worry. “The issue of population growth is not an all-India issue, it is confined to a few large states, which require a focus on this issue.”

According to Kumar, with digital connectivity improving, gram panchayats getting optical fibre network and the implementation of Ayushman Bharat health insurance scheme for 100 million families, there will be less incentives for migration from rural areas to urban centres. “This means the people living in rural areas will be completely connected to urban centres and they can contribute from there. This may result in less migration than in the past.”

Services PMI drops to 50.9: September 2018

India’s services activity slowed to a four-month low in September due to weak demand and stagnant new work. The Nikkei/IHS Markit Services Purchasing Managers’ Index dropped to 50.9 in September from 51.5 in August.

A reading of over 50 in this survey-based index marks expansion.

Despite a slight improvement in the manufacturing sector, where output growth strengthened, the composite PMI for manufacturing and services fell to a four-month low of 51.6 in September. In September, the reading was 51.9.

Companies reported that market conditions were underwhelming amid a lack of demand at a time of generally higher prices. Average output price inflation was the strongest recorded since April and marked a twentieth successive monthly increase in prices charged.

The services activity index is based on a survey conducted among purchasing executives of more than 400 services providers divided into five categories: consumer services, transport & storage, information & communication, financial & insurance, and real estate & business services. Underlying growth in activity and new work remained strongest in information & communication. In contrast, there were falls seen in the finance & insurance and business services categories. Business services continued to record the weakest trends in new work.

Confidence among service providers about the year ahead remained inside positive territory. Around 22% of the survey panel signaled expectations for activity growth, with market demand forecast to strengthen.

Marketing and the offering of high quality services are also expected to bolster activity.

Centre cuts fuel prices

The Centre announced a reduction in petrol and diesel prices by Rs 2.50 a litre and nudged states to match the cut through a reduction in VAT to bring much-needed relief to citizens reeling under the burden of runaway fuel rates.

BJP-ruled states, including Uttar Pradesh, Gujarat and Haryana, apart from poll-bound MP and Chhattisgarh, responded, which will result in a reduction of the price of auto fuel in at least 11 states by Rs.5 a litre. Maharashtra announced a Rs.3.2 cut in petrol price, but a decision on diesel is pending. The decisions will give Mumbai’s petrol consumers a total relief of Rs.5.70 per litre mainly due to a reduction in value added tax and state surcharge. The new rates will be effective from Friday.

While Bihar, Odisha and Punjab will take a decision soon, opposition-ruled Delhi and West Bengal demanded a reduction of Rs.10 a litre. States such as Kerala and Karnataka opted to ignore the Centre’s request for lowering VAT, at least for the time being.

After holding out for nearly three months, the government decided to lower central excise on petrol and diesel by Rs.1.50 a litre and also instructed state-run oil marketing companies to pare retail prices by Re.1 a litre. Finance minister Arun Jaitley, who announced the cut, said the move was necessitated by an increase in Brent crude oil to a four-year high of $86 a barrel on Wednesday, and seven-year-high interest rates in the US.

The price cut followed consultations with PM Narendra Modi and oil minister Dharmendra Pradhan.

The duty reduction will leave a Rs.10,500-crore hole in the Centre’s kitty during the current financial year with IndianOil, Bharat Petroleum and Hindustan Petroleum too bearing the brunt. The stock market responded adversely to the price cut with shares of the retailers crashing over 10%.

Jaitley said the impact on revenue would not hit the Centre’s fiscal deficit target for the current year, which is budgeted at 3.3% of GDP. “Now all states will be on test... Will have to see states where leaders were indulging in lip sympathy and tweeting, what would these states do,” he said, adding that states had benefited more from the rise in global crude prices. So far, the government had been reluctant to reduce duties citing adverse impact on public finances which, it feared, would also add to market uncertainty and stress the rupee.

Indore, Bhopal metro rail projects approved by Modi-led Cabinet

The Cabinet, chaired by the Prime Minister Narendra Modi, has approved two big metro projects in a bid to improve the metro rail connectivity in two prominent cities of Madhya Pradesh – Bhopal and Indore. For the implementation of the metro projects in both these cities, an SPV namely Madhya Pradesh Metro Rail Co Ltd. has been constituted. A press release stated that the tenders for first civil work package have been invited already and work on the metro projects will start soon.

For Indore city, the Cabinet has approved the implementation 31.55 km long Ring line from Bengali Square – Vijay Nagar – Bhawarsala – Airport – Patasia – Bengali Square. The Ring line is likely to connect major public nodes and city cluster areas of Indore. The Ring line, which will cover 30 stations, is being developed at a cost of Rs.7500.80 crore. The Indore Metro Rail Project is also likely to be completed in four years.

After the completion of the Indore Metro Rail Project, population of 30 lakh of the city will be benefited as it will provide connectivity to all the densely populated areas of the city with the new developing areas along with railway station, airport and ABD under the Smart City project. Also, the metro project will provide eco-friendly as well as sustainable public transport to residents, regular commuters, students, office workers visitors and travelers.

To improve the metro connectivity across the state capital, the Cabinet has approved the implementation of two corridors of total length 27.87 km including the stretch from Karond Circle to AIIMS of 14.99 km and the 12.88 km long stretch from Bhadbhada Square to RatnagiriTiraha. The Karond Circle to AIIMS corridor will cover 16 stations while Bhadbhada Square to RatnagiriTiraha corridor will cover 14 stations. For the development of the Bhopal Metro Rail Project, around Rs.6941.40 crore will be spent and it is likely to be completed in four years.

The government is hopeful that once the project is complete, the entire population of Bhopal will get the benefit from what it says will be an affordable, reliable, safe, secure and seamless transport system.

One of the interesting factors about these corridors is that they will be having multimodal integration with railway stations as well as BRTS stations and also they will have feeder network of bus services, intermediate public transport and non-motorised transport. The Cabinet informed that the metro projects will have non-fare box revenue from rental and advertisement as well as Value Capture Financing through mechanism of Transit Oriented Development and Transfer of Development Rights.

India's service activity slows in September

India's services sector expanded at a slower pace in September as higher fuel costs and stronger US dollar made imported goods expensive.

The seasonally-adjusted Nikkei India Services Business Activity Index touched 50.9 in September, down from 51.5 recorded in August.

This is also the lowest reading in the current four-month sequence of rising activity.

In PMI parlance, a print above 50 means expansion, while a score below that denotes contraction.

Expectations remained in positive territory, whilst firms added to their staffing levels for 13th successive month as part of efforts to keep on top of workloads.

The service sector continued to expand during September, but at a marginal rate amid reports of underwhelming market demand. "Price pressures intensified, with higher fuel costs and a stronger US dollar raising the price of imported goods," it added.

IHS Markit complies the survey on a monthly basis.

Companies reported that market conditions were underwhelming amid a lack of demand at a time of generally higher prices.

Broad sector data showed that underlying growth in activity and new work remained strongest in information and communication sector.

In contrast, there were falls seen in the finance and insurance and business services categories.

Although manufacturers recorded a slightly stronger increase in employment, the rise was insufficient to prevent a slowdown in overall jobs growth, the report said.

Latest data showed the net rise in private sector employment was the slowest in over a year.