KCR is back as Telangana CM

Telangana Rashtra Samithi president K Chandrasekhar Rao took oath as the chief minister of Telangana for the second time during a time chosen for its auspiciousness or “muhurtam”.

KCR, as he is popularly known, was sworn in as the chief minister exactly at 1.25 pm, as per the muhurtam fixed by the Vedic pandits from Lord Lakshminarasimha Swamy temple at Yadagiri in Bhongir district, a famous pilgrim centre in Telangana. He is known for his beliefs in religious customs, traditions and rituals.

A priest called the time of KCR’s swearing-in as “Baahubali Muhurtam.”

Governor ESL Narasimhan, who is also an ardent believer in Hindu rituals, administered the oath of office and secrecy to KCR and also another cabinet minister Mohd Mahmud Ali, who served as deputy chief minister in the previous term.

While KCR,64, took oath in Telugu, Ali did it in Urdu. The Cabinet will likely be expanded on December 18.

The head priest of the Yadadri temple Lakshmi Narasimhacharya said the auspicious time for the TRS president to take oath as the chief minister would start at 1.24 pm on Thursday, which happens to be Margasira Shashti as per Hindu almanac.

“The auspicious period will continue for another one-and-a-half hour. That is why we suggested this muhurtam for him,” he said.

The priest said it would give a “Raja Yoga” for KCR, who would get immense power to rule the state without any obstacles. “During this period, all the “grahas” (planets) are in a high position for him and bring him good luck in whatever he does,” Narasimhacharya said.

The TRS won a second straight term in India’s youngest state after scoring a landslide victory in the assembly elections. It had 88 seats in its kitty in the 119-member assembly.

The Maha Kootami – the grand alliance of the Congress, Telugu Desam Party, Communist Party of India and the Telangana Jana Samithi – managed to win just 21 seats. The Bharatiya Janata Party ended up with one seat.

The All-India Majlis-e-Ittehadul Muslimeen, headed by Asaduddin Owaisi, has retained seven seats, while independent candidates won the remaining three seats.

Trade snippets

Growth in India’s merchandise exports slumped to 0.8% in November from 17.86% in October, the result of an unfavourable base effect, as the trade deficit narrowed benefitting from a sharp fall in crude oil prices.

Imports grew at 4.3% while the trade deficit fell to $16.7 billion in November.

A double-digit contraction in exports of gems and jewellery and engineering goods in November weighed upon the performance of non-oil exports.

A contraction in imports of gold and precious and semi-precious stones, transport equipment and pulses offset a portion of the rise in the crude oil import bill.

Growth in exports slumped to 0.8% in November from 17.86% in October, while that of imports fell to 4.3% from 17.62% in the previous month.

With oil prices falling by over 30% since October, India’s external outlook is expected to improve.
However, a decision last week by the Organization of the Petroleum Exporting Countries (Opec)
and some non-Opec producers, including Russia, to cut supply by 1.2 million barrels per day has supported prices this week.

That said, with an impending global slowdown and higher oil production in the US, the upside to oil price rise seems to have been capped.

Most economists have now narrowed down their current account deficit projections for 2018-19 after the current account deficit touched a four-year high at 2.9% of GDP in the September quarter.

While ratings agency Icra Ltd now estimates the CAD at 2.6% of GDP, Bank of Baroda has projected the figure at 2.5%. The International Monetary Fund, or IMF, has said that India’s CAD is expected to widen to 2.6% of GDP in 2018-19.

However, at current levels it is much narrower than the near 5% of GDP seen during the taper tantrum of 2013.

Data released by the Reserve Bank of India showed an 18.8% expansion in services exports in October, which partly benefited from a weaker rupee, contributing to a robust 23% rise in the services surplus.

In a report on India’s exports published as part of an economic strategy for the next government, economists Gita Gopinath and Amartya Lahiri said constraints to growth in exports appear to be generalised due to low scale of production, low productivity and institutional frictions.

They said the ongoing reset of the China-US trade relations may be an opportunity.

In the 25 years since 1992 when India began liberalizing its trade regime, India’s share of world goods exports has risen from 0.5% in 1992 to 1.7% in 2017.

The corresponding export share of the much-celebrated Indian service sector rose from 0.5% to 3.4% during this period.

To put these numbers in context, over the same period the Chinese share of world merchandise exports rose from 1.8% to 12.8%.

Closer home, Bangladesh more than doubled its share of world merchandise exports in just the last ten years, going from 0.09% in 2007 to 0.2% in 2017.

Kamal Nath is Madhya Pradesh CM

After daylong deliberations, Congress chief Rahul Gandhi took to Twitter late on Thursday evening and tweeted a picture with Kamal Nath and Jyotiraditya Scindia — the two contenders for the chief minister’s post in MP — and quoted Leo Tolstoy. “The two most powerful warriors are patience and time.”

The indication was loud and clear: Scindia will have to show “patience” while it is Nath’s “time” to take charge.

Moments later, Scindia, who spent a good part of the day at Rahul’s 12, Tughlaq Lane residence, tweeted the same picture with the caption: “It is not a race, it is not about kursi, we are here to serve the people of Madhya Pradesh. I am leaving for Bhopal and you will get to know the decision today.”

He flew out of Delhi along with Nath to meet the elected party MLAs and workers waiting at the Bhopal party office. Posters and banners were already out in Bhopal, hailing Nath as the chief minister. In Bhopal a meeting of the Congress legislature party is slated around 10 pm, where the announcement will be made.

All throughout the day, state observers and in-charges of MP, Rajasthan and Chhattisgarh kept shuttling in and out of Rahul’s residence. Former Congress chief Sonia Gandhi and Rahul’s sister Priyanka Gandhi Vadra also arrived at his residence and weighed in on the decisions.

While the discontent among the contenders who lost out in the race will come up as a big hurdle ahead of 2019, the immediate challenge at hand is to contain the unrest in the state units. Supporters of Scindia kept egging him on to fight for the top job and continued building pressure on the party high command by incessant sloganeering in his favour.

MMRDA takes over operations of Mumbai monorail

The Mumbai Metropolitan Region Development Authority terminated its contract with L&T-Scomi Engineering consortium to operate city’s first monorail between Wadala and Chembur as the joint venture could not meet contractual obligations. The authority also announced to encash bank guarantee worth Rs.200 crore of the joint venture.

The MMRDA’s Metropolitan Commissioner RA Rajeev, however, absolved L&T of any wrongdoing, and blamed Malaysian engineering giant Scomi for its failure to meet contractual obligations. He said, “The L&T was supposed to create infrastructure for the monorail, which it did, but Scomi failed to supply and maintain the rakes as per the agreement.”

As per agreement, Scomi was supposed to supply 15 rakes, but it supplied only 10, of which only six are operational. The remaining four are non-functional due to lack of spare parts and proper maintenance, according to MMRDA.

The project was ill-fated since inception. The project’s foundation stone was laid in 2009 and its first phase was to be operational in 2011, but due to delays in land acquisition, environmental clearance and other issues, it was thrown open to public only in February 2014. The second phase of the project between Wadala and Jacob Circle is yet to become operational. It has missed at least 10 deadlines to start the project. The cost of the project has also escalated from Rs.1,100 crore to nearly Rs.2,500 crore.

The authority had slapped a showcause notice on the operator on December 7. The consortium filed an interim reply on December 13 and asked for more time to give a detailed reply, he said. Rajeev said the consortium was given a long rope to enable them to recover from cash crunch, but they failed to supply the rolling stocks and operate and maintain the 8.9-km corridor.

The 198 employees of the company will be absorbed through third party, said Rajeev.

The authority had first proposed the monorail in November 2005. The work for 18.5 km corridor between Jacob Circle, Wadala and Mahul via Chembur was awarded to L&T, along with the Malaysian partner Scomi Engineering in 2008.

The state had also planned to construct nine other monorail corridors. However, with the failure of the pilot project, it abandoned the plan to build a 190 km monorail network across the Mumbai metropolitan region.

Replying to a question, the MMRDA chief said, “The second phase of the monorail project will be commissioned in the next three months.”

“We will be issuing global tenders not only for spare parts and tyres for replacement, but also for additional 10 rakes. We hope in the next three months, we will be able to commission the second phase depending on when we get the rakes,’’ he said.

Dharavi Redevelopment Project update

The project to redevelop one of the largest slums of Asia, Dharavi, in the heart of Mumbai has generated considerable interest among realty developers and major contractors as around 20 entities and their joint venture partners attended the pre-bid meeting, said two persons with direct knowledge of the development.

The pre-bid meeting was conducted by Dharavi Redevelopment Project that falls under the purview of the Slum Rehabilitation Authority. The project will be awarded to the entity that bids above the base price of ₹3,150 crore.

The selected lead partner is expected to form a special purpose vehicle with its own contribution of 80% equity worth ₹400 crore, while the government of Maharashtra will infuse ₹100 crore to hold 20% equity in this venture.

After nearly 15 years of deliberations and three attempts to redevelop Dharavi, the government of Maharashtra has invited global tenders last month to kick-start the process. The tenders for bidding will be available between November 28 and December 28, which is also the last date for submission of the bids.

The interest shown during the pre-bid meeting is contrary to the experts’ concern that the current liquidity crisis may hold back realty developers from coming forward to take up this large-scale and complex project spread across 593 acres.

Apart from equity worth ₹400 crore, any further investment needed for the project will be brought in by the lead partner in the form of compulsorily convertible instruments, including debentures and preference shares.

This SPV will be responsible for constructing free housing for eligible slum dwellers and occupants including amenities and infrastructure as per the terms stipulated by the state government.

In lieu of this, the SPV will be entitled to construct the free sale area to sell in the open market. The project will get FSI, or permissible development rights, of four times.

The Maharashtra government has notified the entire Dharavi as a notified area and appointed the Slum Rehabilitation Authority as a special planning body.

The earlier plan was to divide Dharavi into five sectors. As per the old plan, MHADA was to redevelop one of the sectors and four others were to be redeveloped through private participation. However, the plan did not make much headway.

Gehlot is Rajasthan's CM

Congress president Rahul Gandhi chose Ashok Gehlot as chief minister of Rajasthan after two days of hectic indoor parleys and outdoor drama. State Congress president Sachin Pilot, who had made a strong bid for the top post, was persuaded to settle for the role of deputy chief minister. This will be the third term as chief minister for the 67-year old Gehlot after having served in the post in 1998-2003 and 2008-13. Pilot, 47, was a minister of state in the UPA regime.

Both left for Jaipur soon after the decision was reached to hold the Congress Legislature Party meeting to confirm the decision. A party delegation thereafter met the state governor with Gehlot staking his claim to form the government.

Gandhi took the decision after taking into account the views of newly elected Congress legislators and after due deliberations with many party leaders, AICC observer KC Venugopal said at a briefing, where he was accompanied by Gehlot and Pilot.

“The Congress government will fulfil the election promises such as farmers’ loan waiver, job generation and will also build many infrastructure projects for the state,” Gehlot said. The new CM is also expected to roll out a slew of welfare schemes, something he has done in his previous tenure.

Pilot appeared to have overcome the rancour that had broken out between the two factions, with his supporters allegedly resorting to violence on Thursday. “Me and Gehlotji have worked our magic on the people of Rajasthan,” Pilot said. “We will meet the governor today and decide on the details of the oath-taking ceremony.”

Both leaders profusely thanked Gandhi, other party leaders, elected MLAs and party workers and vowed to rise to their expectations. The infighting had delayed the Congress party’s selection of chief ministers in Rajasthan, Madhya Pradesh and Chhattisgarh, after wresting the three states from the Bharatiya Janata Party in recent elections. Kamal Nath was chosen as Madhya Pradesh chief minister on Thursday.

As per the strength of the Rajasthan assembly, the Gehlot ministry can have a maximum of 30 ministers. Taking into account the caste equations of the state, the chief minister may give proportional representation to the Jat, Brahmin, Meena, Rajput, Dalit, Gujjar and Bania communities. Tentatively, the oath-taking ceremony is slated for December 17. Given the preponderance of Gehlot loyalists among the elected MLAs, his camp is bound to get the larger share of ministerial berths with Pilot reportedly keen to keep either the finance or home portfolio for himself besides ensuring ministerial berths for seven-eight of his backers. The All India Congress Committee announcement triggered celebrations among party members, with the supporters of Pilot also seemingly happy with the power-sharing arrangement.

Consensus reached after Pilot loyalists were assured of at least 7-8 ministerial berths

SC Rejects Petition for Probe into Rafale Deal

The Supreme Court refused to order an investigation of the Rafale deal, citing the inherent limitations of its power to undertake a judicial review of “sensitive” defence contracts and its lack of expertise in scrutinising pricing or technical feasibility. The move was welcomed by the government and condemned by its critics.

The bench led by chief justice of India Ranjan Gogoi dismissed pleas to order a probe into corruption allegations by former ministers Yashwant Sinha and Arun Shourie among others.

“We are satisfied that there is no occasion to really doubt the process, and even if minor deviations have occurred that would not result in either setting aside the contract or requiring a detailed scrutiny by the court,” the bench said. “We find no reason for any intervention on the sensitive issue of purchase of 36 defence aircraft…. Perception of individuals cannot be the basis of a fishing and roving enquiry by this court, especially in such matters.”

The petitioners alleged that the government had pulled a 2001 deal to buy 126 jets at a lower price only to conclude a fresh deal in 2015 to buy 36 jets at a higher price. The government disputed this claim, saying the cost escalation was on account of add-ons in terms of avionics and armaments.

The petitioners alleged a conspiracy at the highest level to defraud the exchequer and favour the Anil Ambani group chosen as offset partner by French aviation company Dassault, which makes the Rafale. Congress president Rahul Gandhi had made the Rafale deal his main point of attack related to corruption against Prime Minister Narendra Modi and BJP ahead of the recent assembly polls, which saw the Congress beating its rival in three states.

Sinha, Shourie and the other petitioners said they were disappointed that the court had taken a “conservative view of judicial review” in cases alleging corruption in defence deals involving high functionaries.