Black economy now amounts to 75% of GDP

NEW DELHI, August 4, 2014

Updated: August 4, 2014 08:24 IST

India’s black economy could now be nearly three-quarters the size of its reported GDP

Driven substantially by the higher education sector, real estate deals and mining income, India’s black economy could now be nearly three-quarters the size of its reported Gross Domestic Product (GDP). These are among the findings of a confidential report commissioned by the government and accessed exclusively by The Hindu.

Since there were no “reliable” estimates of black money generated in India and held within and outside the country, the UPA government commissioned the National Institute of Public Finance and Policy (NIPFP) to estimate the black money in India and held overseas by Indians.

The Special Investigation Team on black money, constituted by the Narendra Modi government on May 27 in compliance with a Supreme Court directive, is studying the report.

Though the report was submitted to the Finance Ministry in December 2013, the UPA’s Finance Minister P. Chidambaram did not place it in Parliament. Nor has his successor Arun Jaitley done so.

The capitation fees collected by private colleges, on management quota seats in professional courses, last year was around Rs 5,953 crore, the report estimates.

 

‘Social spending programmes not reaching needy’

In 2009-10, 33% of PDS off-take of kerosene diverted for non-household use: report

The findings of a confidential report, commissioned by the government and accessed exclusively by The Hindu, have revealed that allocated expenditures of social spending programmes are not reaching intended users and confirm leakages due to corruption.

The capitation fees collected by private colleges, on management quota seats in professional courses, last year was around Rs 5,953 crore, the report estimates. Generation of black money in transfer of real estate properties is conservatively estimated at a staggering Rs 5,68,879 crore. If this could be plugged, India could almost double its Plan spending. Total Plan expenditure allocated by this year’s budget is Rs 5,75,000 crore.

For the decade 2001-2010, the average unaccounted income from minerals as a percentage of GDP is 10.32 per cent. This estimate excludes illegal mining and will be higher on accounting for that.

In 2009-10, almost 33 per cent of PDS off-take of kerosene or 3.87 billion litres was diverted for non-household uses. In 2011-12, Rs. 11,910 crore unaccounted incomes arose out of use of PDS kerosene as the adulterant for diesel.

The report finds that just 1.8 per cent of registered legal professionals file tax returns, including just 6.7 per cent of registered chartered accountants, 42.8 per cent of registered medical professionals and 35.2 per cent of nursing homes.

It includes a survey of 72 senior income tax officials on the sectors with high propensity to generate black money. The respondents considered the capital gains on real estate as the most important source followed by large-scale manufacturing, film industry, smuggling and under/over invoicing of foreign trade.

The study reports a discernible decline in percentage terms in the black economy post-1991 though in absolute terms it is still large. The foreign direct investment route is being used for taking black money out and bringing it back into India, the report finds. In 2011, unrecorded foreign assets worth $89,190 million were accumulated in India.

http://www.thehindu.com/news/national/allocated-expenditures-of-social-spending-programmes-are-not-reaching-intended-users-report/article6278037.ece?ref=relatedNews

US back in Iraq again, bombs ISIS to 'prevent genocide'

 

Chidanand Rajghatta

Washington

But No Boots On Ground, Says Obama

US warplanes bombed Islamist fighters marching on Iraq’s Kurdish capital in the north on Friday after President Barack Obama said Washington must act to prevent “genocide”.

Militants of the Islamic State (formerly ISIS, Islamist State of Iraq and Syria), who have beheaded and crucified captives in their drive to eradicate unbelievers, have advanced to within a half hour’s drive of Irbil, capital of Iraq’s Kurdish region and a hub for US oil companies.

US airlines and other commercial carriers have been barred from flying over Iraq except in emergencies.

A Pentagon spokesman said two FA-18 fighter jets from an aircraft carrier in the Gulf dropped bombs on a mobile artillery piece used by the fighters to shell Kurdish forces defending Irbil.

Obama on Thursday authorized airstrikes against the Sunni extremists even as he pledged not to return US ground troops to the region.

Ahead of the strike, US aircraft dropped food and water to Yazidi minorities trapped on Mount Sinjar, driven out by the ISIS and facing annihilation. The actions constituted the deepest US engagement in Iraq since its troops withdrew in late 2011 after nearly a decade of war.

Obama, who campaigned on a platform of extricating US troops from Iraq and Afghanistan, suggested his hand was forced by the barbaric militants advancing on Irbil. “People are starving.

Children are dying of thirst.

Meanwhile, ISIS forces below have called for the systematic destruction of the entire Yazidi people,” he explained to Americans in a late-night address from the White House, saying when the US has the capabilities to help avert a massacre, it is the American thing to take action.

US airlines and other commercial carriers have been barred from flying over Iraq except in emergencies.The US President, who campaigned on a platform of extricating US troops from Iraq and Afghanistan, suggested his hand was forced by barbaric militants of the ISIS advancing on Irbil, a nerve centre of US operations in Iraq.

“People are starving. And children are dying of thirst.
Meanwhile, ISIS forces below have called for the systematic destruction of the entire Yazidi people,“ Obama explained in a late-night address from the White House, saying when the US has the unique capabilities to help avert a massacre, it is the American thing to take action.

“That's a hallmark of US leadership. That's who we are,“ the president told a nation that is largely sceptical of getting entangled in foreign crises again after two wars that have cost over a trillion dollars and thousands of casualties. US officials said Pentagon has been authorized to launch airstrikes against ISIS extremists if the military determines that Iraqi troops and Kurdish forces are unable to break the mountain siege and there is imminent danger of massacre of the trapped people.

Danger to nearly 1000 US personnel in Baghdad and Irbil, both under threat from rampaging ISIS forces, will also precipitate air strikes.

Obama's turnaround, which came after weeks of resisting military action, followed continuing ISIS advances in Iraq that a token infusion of about 700 US military personnel failed to stem.

 

US takes aim at Israeli antitank missiles in Indian arms market

 

Rajat Pandit,TNN | Aug 10, 2014, 03.31 AM IST

A Javelin portable antitank missile is launched during an army exercise at Range Control, High Range on September 4, 2009 in Townsville, Australia. (Getty Images file photo)

NEW DELHI: Israel, better watch out! The US is going all out to shoot down the Israeli 'Spike' antitank guided missile (ATGM) with its own "Javelin" missile in the lucrative Indian arms market. Given the huge size of the Indian ATGM project, upwards of $3 billion, Israel is sure to strike back.
But for now, the US seems to have gained the upper hand. After earlier being rebuffed by India for not agreeing to "full" transfer of technology (ToT), the US is now promising to not only "co-produce" the third-generation Javelin ATGMs, but also "co-develop" its fourth-generation version.
"This is an unprecedented offer that we have made only to India, and no one else," said visiting US defence secretary Chuck Hagel on Saturday, a day after hard-selling joint development and production of advanced weapon systems to Prime Minister Narendra Modi and defence minister Arun Jaitley.

There are already over a dozen such proposals from the US on the table, ranging from the Javelin, MH-60 Romeo multirole helicopters and "big data cybersecurity" to unmanned aerial vehicles (UAVs), mine-scattering systems and warship guns, which will now be taken forward by the revived bilateral Defence Trade and Technology Initiative (DTTI), as earlier reported by TOI.

US marines carry Javelin missiles close to the Iraqi border in Kuwait in the morning of March 18, 2003 after George W Bush, the-then US president, gave Saddam Hussein 48 hours to leave Iraq. (Getty Images photo)

"I will play an active role in expanding the DTTI because it's the centerpiece of our defence partnership ... As our interests align, so should our armed forces and defence systems. Bureaucratic red-tape must not bound the limits of our partnership," said Hagel.

But the US will have to contend with Israel, even though it has now displaced the latter as the second-biggest arms supplier to India after Russia. The Indian defence acquisitions council, in fact, had almost finalized the Israeli Spike ATGMs for clearance late last year, after a series of field trials, before the US muscled its way into the race once again.

A rocket from a shoulder fired Javelin missile explodes on a mock target during an army fire power demonstration at Range Control, High Range on September 4, 2009 in Townsville, Australia. (Getty Images photo)

The urgent need for third-generation shoulder-fired ATGMs, which are "fire and forget" missiles, for the 1.13-million strong Indian Army cannot be overstated. The force has a huge shortfall of 44,000 ATGMs of different types, half its authorized inventory at present. Both Pakistan and China, the latter with third-generation ATGMs, are far ahead in the capability to halt and destroy enemy armoured attacks.

The force is currently saddled with second-generation Milan (2km range) and Konkurs (4km) ATGMs, produced by Defence PSU Bharat Dynamics under licence from French and Russian companies. "Being wire-guided, they have to be directed to the target. They are not fire-and-forget missiles," said an officer.

Moreover, the indigenous third-generation Nag ATGMs, which are vehicle and helicopter-mounted with a 4-km strike range, are still not operational despite being in the making for over 20 years. The Army has already placed an initial order for 443 Nag missiles and 13 Namicas (Nag missile-tracked carriers).

http://timesofindia.indiatimes.com/india/US-takes-aim-at-Israeli-antitank-missiles-in-Indian-arms-market/articleshow/39972153.cms

Blue cloth over their conscience

August 2, 2014

Updated: August 2, 2014 01:44 IST

 

A Palestinian woman reacts while standing next to two injured men as they lay on the ground and wait for help following an Israeli strike in the Shijaiyah neighbourhood, eastern Gaza City, on Wednesday. Photo:AP

 

Despite abuses from the Israeli government, the U.S. political class is fully supportive of its acts in Gaza

On the night of Tuesday, July 29, three shells hit the Jabalia Elementary Girls School — a U.N. designated emergency shelter for 3,300 Palestinians. Those who had taken refuge there came because the Israelis had warned them to leave their homes. The U.N. had given the Israelis the coordinates of this school 17 times. Their warnings made no impact. The shells killed at least 16 people and wounded hundreds. The U.N. official in charge, Pierre Krähenbühl (of UNRWA), said in a powerful statement, “Children killed in their sleep; this is an affront to all of us, a source of universal shame. Today, the world stands disgraced.”

No ceasefire is on the horizon. The ‘humanitarian pause’ of August 1 broke down after two hours. The U.N. Security Council could not agree on the language for a resolution — its strongest instrument. A toothless “presidential statement” from the Council called not for an end to the conflict but for “an immediate and unconditional humanitarian ceasefire, allowing for the delivery of urgently needed assistance.” In other words, the U.N. Council members recognise that they have no authority to end the conflict. All they can do is to ask for “humanitarian pauses” so that the U.N. agencies can bring in emergency supplies to a desperate population.

Israel has destroyed Gaza’s only power plant, which impacts the already fragile sewage and water purification system as well as food storage. Electricity is mostly off, which means that the Palestinians are in danger of being cut off from the world. As it is, when Israel conducts its “operations” inside Gaza, it seals the area, preventing media from entrance. The aftermath of these operations has been devastating, whether in Gaza City’s neighbourhood of Shuja’iyya or the town of Khuz’a. Forty-four per cent of Gaza’s 140 square miles (360 square km) have been designated a “buffer zone” by the Israelis. Gaza’s Ministry of Health puts the figure for the dead at over 1,300 and the wounded at close to 8,000 — this number rises steadily.

The U.N. says that over 250,000 of the 1.8 million Palestinians in Gaza are now in their shelters. The U.N. is on its last legs as far as supplies go. “We have reached the tolerable limit that we can accommodate,” Mr. Krähenbühl told the Security Council on July 31. Gaza continues to be under siege by Israel, and the border crossing with Egypt — at Rafah — is effectively closed. The tunnels that the Israelis are destroying had been the arteries for the Palestinians to break the embargo. That is now closed to them.

Read: Pounding Gaza with impunity

U.S. Secretary of State John Kerry travelled around the region trying to move a ceasefire agenda. The Palestinians are clear that any genuine ceasefire must include an end to the siege. Even Mr. Krähenbühl agreed, telling the Security Council on July 31, “The illegal blockade of Gaza must be lifted.”

This is unacceptable to Israel, which believes that the suffocation of Gaza is in its security interest. An official of the Eshkol Regional Council had told the International Crisis Group (ICG) in 2009, “Our forces should flatten Gaza into a parking lot, destroy them.” An end to the siege is the last thing that such a political view would allow. Members of the Israeli Prime Minister Benjamin Netanyahu’s inner circle called Mr. Kerry’s plan a “strategic terrorist attack.” The ceasefire plan brokered with Qatar and Turkey, the Israeli officials said, would spur them to expand their operations against Gaza — to flatten Gaza.

Relations with U.S.

Israeli insults against the Obama administration have been legion. In 2010, the Israelis announced the building of new settlements in Occupied East Jerusalem on the day that U.S. Vice-President Joe Biden arrived in Israel with a peace proposal that included a moratorium on settlement building. He was humiliated. The next year, Israeli Prime Minister Benjamin Netanyahu went before a joint session of the U.S. Congress to say that Israel would never make peace with Hamas. It was seen as a direct snub at U.S. President Barack Obama, who had suggested that a hard-line position against Hamas would not occasion a peace process.

Mr. Netanyahu’s attitude toward the U.S. was clear in his 2001 visit to Ofra, an illegal settlement in the West Bank. He talked to the settlers about the need to pummel the Palestinians. A settler asked him if he worried about the world reaction to such a policy. “Not at all,” he replied, “especially today with America. I know what America is. America is something that can easily be moved. 80 per cent of the Americans support us. We have that kind of support.”

Mr. Netanyahu is correct. Despite abuses from the Israeli government, the U.S. political class fully supports Israel. In the midst of this campaign on Gaza, with all evidence pointing to a violation of the rules against collective punishment, the U.S. Congress unanimously voted to give full support to the Israelis. It also charged the U.N. Human Rights Council with hypocrisy over its resolution that asked for an investigation of Israel’s conduct in the war. The U.S had cast the only ‘No’ vote in Geneva. Not only this, the U.S. Defense Department handed over its stockpiles of weapons that are stored in Israel.

The U.N. has no appetite to apply the principle of Responsibility to Protect. That form of humanitarianism is only useful when it suits western interests

A U.S. defence official said that Israel took possession of 120 mm mortar shells and 40mm grenades — both of which are being used in this bombardment. Seventy nine of the hundred U.S. Senators supported the U.S.-Israel Strategic Partnership Act, which would allow for more arms to be delivered to Israel. The act also encourages the U.S. to ensure that Israel continues to have a “qualitative military edge” over its neighbours. The U.S. political class, despite the abuses from Tel Aviv, seems eager to back Israel to the hilt — diplomatically, financially and militarily.

In 1937, for two hours, the German Condor Legion bombed the small Basque town of Guernica. The incendiary bombs killed hundreds of civilians. Colonel Wolfram von Richthofen, who commanded the squad, wrote that their firebombs “resulted in complete annihilation.”

Picasso turned his talent to bring this event to life, which resulted in his masterpiece, Guernica. Later, he would say, that the painting allowed him to express his “horror of the military caste” which takes the world into “an ocean of misery.”

A tapestry of the painting used to hang outside the U.N. Security Council. When U.S. Secretary of State Colin Powell went to make his fraudulent case for a war against Iraq in 2003, a blue cloth was hung over Guernica. It could not interfere with the masters of war. Today, a blue cloth is hung over any statement that questions Israel’s right to annihilate Gaza.

International political action

Valerie Amos, U.N. head of the Humanitarian Affairs and Emergency Relief department, asked, “Where is the humanity, the morality? It’s children, civilians dying.” Mr. Krähenbühl, in an equally emotional statement, noted, “We have moved beyond the realm of humanitarian action alone. We are in the realm of accountability. I call on the international community to take deliberate international political action to put an immediate end to the continuing carnage.” The apposite phrase here is ‘international political action.’ Mr. Krähenbühl meant the U.N. Security Council. From August 1, the president of the Council is the U.K.’s Ambassador, Sir Mark Lyall. In his statement to the Council on July 30, Sir Mark blamed “both sides” for the conflict, saying, “The people of Israel have the right to live without constant fear for their security, but the people of Gaza also have the right to live safely in peace.”

Read: Missed opportunity on Gaza

The argument of “both sides” erases the context of this bombardment — the occupation of the Palestinian lives and the scale of Israel’s offensive. There is no parity here. Sir Mark’s approach shows that the UNSC has no appetite to move a resolution based on the U.N. principle of Responsibility to Protect (R2P). That form of humanitarianism is only useful when it suits western interests. When it does not, the lives of civilians are of no concern. No wonder Mr. Netanyahu can so casually say, “We need to be prepared for a protracted campaign in Gaza.”

(Vijay Prashad is professor of international studies, Trinity College.)

http://www.thehindu.com/opinion/op-ed/blue-cloth-over-their-conscience/article6272937.ece?homepage=true