The whole political drama of opposition against Foreign Direct Investment ended today when the UPA government notified FDI in retails and mentioned that it is in majority. In my last post, I exposed the myth of economic reforms in form of FDI in retails. Here, I will try to explain more about what is wrong with this issue of FDI and how it is going to harm Indian economy in long run. I will also provide genuine ways for the actual economic reform that it could have been if our Prime Minister Manmohan Singh hadn’t acted so much intellectually dishonest. What has Wal-Mart Produced for the United States? The U.S. based Wal-Mart is world’s biggest retailer chain that is now ready to set its foothold in India. Most of the liberals and in fact, some of the libertarians are also appreciating this move and obviously, their idea is pretty simplistic, they believe some foreign direct investment is better than nothing. However, they fail to notice the effect of Wal-Mart on the US economy. When China entered the World Trade Organization, the U.S. government thought that it will be able to reduce the trade deficit with China. However, it all proved …Read the Rest
Tag: Manmohan Singh
The Myth of Economic Reforms: FDI in Retail
Foreign Direct Investment in retail sector is becoming a huge issue that has caused a serious danger on the current UPA government under the leadership of Manmohan Singh, the Keynesian economist. The opposition parties has called on a nationwide strike on 20th of September and every common citizen is still wondering about what is this FDI in retails and how will it affect or benefit the common man. It should be noted that the regular slogan of current government and Congress Party is “Our Hand is with Common Man.” In my last post, I explained why FDI in aviation is actually a benefit for the big corporate in aviation sector of India and how it has nothing for the common man in general. I also explained that FDI in aviation will still prove to be beneficial because government may now feel no inclination towards providing huge bailouts and subsidies for big corporate of India. Yet, this is also true that unless the government completely disinvest its whole share in Indian Air India Ltd. and announces a general policy of not interfering with the aviation sector, it is just a fraudulent way to create another economic bubble which will burst within …Read the Rest
Foreign Direct Investment in Aviation Sector of India
The Indian Prime Minister Manmohan Singh is being ridiculed as ‘underperformer,’ ‘puppet prime minister’ and various other names since a long period. However, Manmohan Singh chose to roar back this time and the government announced 51% FDI in Retails and 49% FDI in aviation. This decision came just after the previous announcement of an increment of Rupees Five in the price of Diesel and a reduction of subsidies for LPG. The opposition parties and the media presented the whole issue in a dramatic manner and many of the allies of current coalition government also expressed their rejection for these politico-economic moves. In previous post, I presented the reasons why the reduction in subsidies isn’t anything beneficial for the tax-payers of India and it will increase economic burden on poor, middle class, and upper-middle class families. Here, I will discuss about the issues of Foreign Direct Investment in aviation industry. Foreign Direct Investment in Aviation Sector The opposition parties aren’t talking much about the approval for FDI in aviation sector and this is because of the fact that common men of India do not use air flights for their travelling purposes. The total number of passengers who travelled through air in …Read the Rest
Issue of Hoarding Money in Swiss Banks
The political sting against corruption and black money1 that was raised by Team Anna and Baba Ramdev hasn’t evaded yet and the Indian media is ready to blow winds against hoarding in general. Recently, various Indian newspapers, including The Indian Express published a report about rich Indians hoarding banknotes, art works and gold in Swiss Banks2 . General belief is that by hoarding money, people selfishly cause a slug in the flow of money circulation and hence, they hamper trade. Politicians, mob leaders and Keynesian economists suggest that hoarding of money causes depression, poverty and other economic problems. Politicians also make a huge issue of hoarding money and Indian President Pranab Mukherjee also expressed his worries over flow of savings for investment in gold3 when he was the finance minister of India. He said that there is a need to dissuade people from investing in gold. However, hoarding is certainly not a menace and all this hue and cry against hoarding money is Swiss banks is just because of irrational Keynesian economic approach. What is Money Hoarding? Hoarding money is saving money (in any form) to use it in future, when the need arises. It is a person’s increased desire …Read the Rest
