Mumbai

Mumbai is undoubtly the most popular metropolis of India. Apart from the title of 'Financial capital', Mumbai boosts of the biggest stock exchanges (BSE, NSE), house to Bollywood stars, Night life, safety of women, Sea Link, Skyscrapers among the majors in fascinating list. Not to forget, links to the underworld, smuggling, mafia and flesh trading. Dont be surprised to find posh colony, with sophisticated people staying in high end area adjancent to slum hutments. Largest slum of Asia, 'Dharavi' is in Greater Mumbai, in popluar lingo called Town Side. More than 50 % of Mumbai's 1.5 Crore population live in slums. Slums have families living in most unhygenic conditions in a 10" x 10" size hut. Also famous for local trains which run almost 20 hours a day. Just stand at any Subarban local railway station on a monday morning at 9 AM, you will witness a war like situation with people fighting to get inside the already more than crowded train compartments or on top of them. By the way, local trains are most outdated urban mass transport system existing. A long list to talk about this city, also known as 'Maximum city'. Mumbai is full of paradoxes. People have very low wages as compared to other metroplis of World, but 3rd Costliest city in Property prices. In some areas, rates are as high as Rs. 85,000 for just one sqaure feet $ 2000 for 1 sqaure feet space. A very vast coastline, but uglist public beaches. Most outdated mass public transport sytems, and also the highest number of luxury sedans. One of the Lowest standard of living as compared to other Cities of the World, and also some of the richiest people of the World reside in this subcontinents most happening place. Mumbai provides more than 1/3rd of the taxes that Governent collects and has a growing population which will soon become more than Australia or whole of Scandinavia. Yet the city doesn't get sufficient attention from the Government and is fighting for basic needs of good transport system, roads, sewage disposal, drinking water and electrcity.

Mumbai remains 'Sapno ka sehar' and will remain for a long time to come. Mumbai is face of emerging India. Times Magazine writes 'Mumbai is shaping India's future -- and the future of the World'. Give Mumbai another 12 - 15 years time, it will be difficult to recognize it. 3 huge Metro projects, another sea-link from Bandra to Versova, sky walks to major rail stations, tourism booster structures creation and upgradation, Slum rehaitalisation, and a lot more on way. With positive political will, it should not take more than 12-15 years for Mumbai to get a proper make over.

THE NEW INDIAN ORDER!!!!

Its been a long time. In my last post, I was too worried about the elections and the profile of the parties contesting - Congress led, BJP led and 3rd Front. After the election verdict I am happy that there is a Cong led stable Government at the center.

The Indian people have voted for stability, for growth, for prosperity, for better future. Its time for a NEW INDIAN ORDER. This "New Indian order" will lead to a more prosperous and powerful nation state. For that to happen, Religious hatred, regional hatred and caste based segmentation (leading to more and more complexities and caste based riots) should be rooted out. Well for that we need to have a more mature society. This may take several Decades and can only be accelerated to some extent by better education to masses and improved economic conditions.

There are lot of expectations from Govt. "New Indian order", is not possible without political will of our national leaders. We are plagued by poor infrastructure, miserable health care facilities, poverty, disastrous educational system, etc etc. "New Indian order" is not another marketing or branding stuff like "India shinning", its real and something we can achieve. Its not coined by any political party or media house. Its a dream of every fellow Indian.

The road ahead is full of obstacles, most of them created by ourselves. Some of the things necessary for the "New Indian order" are -

1) Inclusive growth in true sense

2) Power - Not just to Industry but to every household, to even the most interior village. Not just adding power generation capacity by traditional means but also monitoring fraud and theft of power. Not to forget, Nuclear power generation capacity building.

3) Drinking Water - people are worried of Oil shortage crisis. Lakhs still don't have adequate drinking water. In many villages still people have to travel miles to gather few buckets of water. This should be a major concern when the Cong party talks of inclusive growth. Need of the day - Capacity building, water conservation, rain water harvesting, pipe connections network expansion.

4) Roads - Road network expansion has already been identified by Kamal Nath. He has promised a 20 Km per day road addition for the next 5 years. He is setting a new company to manage funds for this purpose - Road Finance Corporation. Lets hope this promise is fulfilled.

5) Education - Structural changes needed. Standard of Indian universities is too low. Just setting up more IIT's and IIM's will not make much difference. The structure, right from primary education to higher education needs a serious revamp. Lets hope Kapil Sibal gets over reservations issue in educational institutes and does some real constructive work. Shortage of quality faculties another issue as far as higher education is concerned.

6) Urban Development - You simply can't have cities with more than a crore population and negligible facilities. Metro rail network, Slum rehabilitation, traffic conditions improvements ........ a long list. We can't talk of shanghai anytime soon.

7) Controlling Rising Food Prices - Forget talks of zero inflation. Look at food prices. If the rise in food prices is not arrested urgently, millions won't get to eat a balanced or even a moderately adequate nutritious diet.

8) Legal System - make the elephant run or it will ruins many lives.

9) Mobile & Internet - Stimulate internet penetration. Get 3G soon. Improve network quality.

10) More FDI, Lower budget defecit, Divestment, .....
....
.....
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.... A very long TO-DO list for Manmohan Govt.

But i feel "New Indian Order" has began. How far can we go and how fast can we go? Can we become an economic behemoth anytime soon? Or will we be dissapointed again?

Kisko vote Karein???

WHO DO I VOTE FOR?????? BJP or Congress or 3rd front??

BJP's PM candidate is 81 year old L K Advani. Well all know about this person and his role in Babri Masjid demolition. His recent internet publicity campaign talks about great things he will do for this nation. But do we want to grow under the leadership of a person who will create hatred between communities? Certainly not. We are capable of growing without the help of this old man

Congress.....MNS created a havoc in the financial capital of the country. Regional hate campaign of a new found MNS...Cong could not stop that, forget the prevention of terrorist attacks of 26/11. Vote bank politics of Congress lead reservations in reputed institutes of India and a threatening to private sector too..what a shame!!!!

3rd Front.....The WORST SCENARIO for the country....With only railways in Lalu's hands, most of the new trains lead you to Bihar, imagine what a bunch of regional parties will do to development of India as a whole??? Each will act selfish and work for improvement of their own state leaving National growth to chance. Also left parties will RED TAPE the economic growth of the country.

WHO DO I VOTE FOR????? BJP or Congress or 3rd Front??

Bloodbath nearing an end??????

I am writing this post minutes after the historic moment of Obama swearing ceremony. While to millions in USA and World, Obama has become a symbol of hope and optimism, but is the economic bloodbath nearing an end?????

Liquidity has vanished. RBS, Citi, UBS, Deutsche bank have all reported billions of losses in their quaterly results. Oil prices have fallen below $35 per barrel. There seems to be no hope from anywhere. Stock markets have failed to recover even after repeated stimulus and bailouts. Unemployement is soaring high not only in USA and UK, but many parts of the world including developing world.

But some analystes say worst will be over in next few months and economy will pick up in 2nd half of 2009. The logic being, the effects of the stimulus and bailout package will take time to show results. Plus investors are sitting on 70 % cash in USA which is all time high. Whenever stock markets have crashed in USA and cash pile of investors turned 55 - 60 %, there has been a rapid recovery. This time cash pile is 70 %, suggesting a revival in the capital markets in the USA. US capital market revival will give encouragement to capital markets elsewhere including India. A boom in capital markets means more IPO/FPO's resulting in easing of cash worries for most of the firms as money can then be raised through capital markets. Underwriting Investment Bankers will benefit and brokrage firms will benefit with the boom in capital markets. Effects will propagate and positive turnaround may be seen by the end of 2010.

Given Obama power to USA and World, things may change.

MNS-Maha Naya Shame

Jobs for local people in railways (3rd and 4th grade clerical jobs)

MNS - a nightmare to national unity is demanding jobs to local people in the railways. Failing to fulfill their demands has made Mumbai a danger zone for Bihari and UP youths.

The stir by MNS against North Indians recently has raised an alarm that Indian Unity is no more safe. Failure of the Congress Govt to ban MNS has proven that the Central Govt is not potent enough to protect the unity. Leave banning, arresting Raj Thackeray has become an herculean  task to the Congress Govt. With Congress at both Central and State nothing can be expected. There are rounds in political circles that Congress wants MNS to create more rift between marathi and north indians, so that NDA-Shiv Sena takes a back seat. If it is true, then only God can save us and the future of our nation. Once such a hatred enters the mind of a young school going child (which is easy to enter), the hatred between two communities continues for coming several decades. Short term political ambitions based on divide and rule theory can have devastating long term impact on the nation as a whole.

Ask any young boy today, what he wants to be in future? He will answer, Sachin Tendulkar(Marathi).

For a female singer, Lata Mangeshkar(Marathi) and Asha Bhosle(Marathi) are irreplaceble role models.

Lata ji has sung a song ---- 

"Aye mere vatan ke logon, 

zara aankhen mein bhar lo pani, 

jo shaheed hue hain unki zara yaad karo nishani"

We need to understand the message this song carries.

What MNS wants is unconstitutional. Railways is all India level service. Indian citizens are free to move anywhere in our country.

Remeber Constitution was also given by Dr. Ambedkar (Marathi). 

Ford - May have to go Merrill way

While almost everyone is talking about the financial sector meltdown, share prices of auto makers of US have nose-dived to new lows. Ford motors in particular have reached to 4 $ per share from 16 $ per share in 2004, i.e., 75 % fall in 5 years span.

 

While the entire focus is on financial sector, US auto-makers like Ford are bleeding. Ford is making losses every quater. Consumer spending in US is on a major decline and unemployment at its peak. Sale of cars have reached 15 years low in Spetember month. Banks are not giving loans easily to consumers for cars or for that matter for anything (homes, education,etc). With liquidity to remain a major issue in coming months, condition of Ford is going to only worsen.

There is a slowdown in Global economy too. Hence exports will also fall. Plus Ford has being outsmarted by Japanese automakers - Toyota and Honda.

Ford - the legendary auto company and a symbol of american economic pride may go the Merrill way given the present scenario. Will the US Government nationalise it too?? Or will it fall into hands of foreign Automakers like Toyota or Honda?? Or worst scenario, will it go the Lehman way?? 

Well certainly chances of surviving  are dim for Ford and its fate will be decided soon. With fall of Ford along with ending of I-Banking model, capitalism will surely see its defeat.

A spreading Virus

While I was busy testing software for Citibank and HDFC Bank during my technical internship at NCR (Jan to March, 2008), major developments were taking place in 14 trillion dollar economy - The Mighty USA. 

The picture shown here is of Lehman Brothers office in Powai. My office was in the same building. I always dreamt of joining Lehman for my management internship next year. Lehman was a dream!!! Dream of not just one person, but of lakhs of MBA students accross India. Dreams rarely realize!!!! Yes, dream cannot be realized now. Lehamn is no more.

What is going on? The average stock market investor in India has lost most of the cash he invested in blue chip companies. He is afraid to buy at such low levels of Nifty and Sensex. Everything was going good, atleast for India. More than 8% growth rate for past several years. Extremely positive outlook of economy. Inflation was under control. Oil prices also Suddenly, things have tunred around. Look at inflation or oil prices now. Everything has changed. 

Not only Indian stock markets have crashed. Look at any Asian or European market, they are under lot of stress. Stock markets are barometer of economy or in other words indicators of economic health. The root cause is out now. The subprime mortgage crisis of US is taking its toll world over. But our Indian companies and Finance minister are over optimistic and very confident. Still positive about more than 7 % growth rate, positive outlook for jobs, positive about controlling inflation and shoot at them anything, they will show you only the positive, optimistic side. Are we really safe from this US financial bubble burst? Should we believe the corporate CEOs and Finance minister? Credit Sussie conducted a survey - "Corporate survey: India - in denial?" Surprisingly, 60 % of corporates felt, there is going to be no slowdown. One thing is sure that RBI has adequately regulated the banking system of India - hence our banking system is relatively much safer than american banks. Only IT sector is facing the heat of this financial hurricane. Also real estate companies are facing severe pressure to lower the cost of property and hence less profits. This is not the whole truth. There is going to be a heavy liquidity crunch. Without liquidity, majority of the projects and expansion plans of Indian companies across the spectrum will be affected. While this fact is being acknowledged by the analysts and several companies have already started feeling the heat of this liquidity shortage, others choose to remain confident about our growth story even in the short to middle term.

Indian Financial system was insulated during the East asian economic crisis also of 1997. Till 1997, our growth rate was below 6%. After the crisis, there was a boom during which the bankers lent aggressively and at low costs. This vast liquidity which continued thereafter helped us to grow above 8% (ofcourse there were many other factors, but easy liquidity availability was a major reason - prime reason for me). The end of Wall Street model of Investment banking adds to further liquidity shortage to Indian corporates. Plus several banks have exposure to the bad derivatives, which have become worthless. Famous being ICICI Bank. Government is planning to raise the maximum borrow limit from forign shores, but we must realise that there is global credit crisis - global shortage of liquidity. Plus the demand of consumer goods is going down in US due to job losses, salary cuts ensuring low consumer spending. This fall in sales will directly impact Indian companies who exported several goods like textiles, carpets, etc. Plus IT sector is going to be hit by decline of orders by the financial sector. With Oil prices above 100 $ per barrel, how can we stay confident about our growth. Thus the outlook is not very bright for India. The Finance Minister is knowledgeable enough to understand all this. He is showing positive picture to prevent panic. The corporates also know the real picture, they are denying to sustain their stock prices which may crash on acceptance of cruel hard real facts.

The financial bubble burst will spread like a killer virus all over the world with India being no exception. We need to accept the facts, and be prepared for the worst to come. 

But there is always a ray of hope in everything concerned to human beings. The rich middle-east nations are high on cash due to high oil prices. The middle east may emerge as the mecca for cash hunting Indian corporates and companies world over. Plus Indian IT companies are trying to increase the exposure to middle east and make softwares for non-financial sectors too.

I would end it here quoting Winston Churchil

    "Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning"