1st April

So far, so good

The article talks about the latest report submitted by the Committee on Financial Sector Assessment and its importance in terms of timing. The report also suggests reforms that are needed although it marks the overall financial system in India as sound and resilient.

Set up in September 2006, when capitalism was at its peak, the committee took over two years to submit its report. These two years witnessed the failure of capitalism and brought out a great reality check for the free market fundamentalists and pure financial capitalism. This resulted in the report being far more conservative then the other two recent reports on financial sector – one headed by Percy Mistry and other by Raghuram Rajan. It suggests calibrated liberalization on the lines of RBI over the issues like opening up of banking sector to foreign banks, capital account convertibility, caution against off balance-sheet items and OTC derivatives. While the tide has turned from liberalization to conservatism, caution has to be taken that in their desire to play safe, the practitioners do not strangle financial innovation. While the report still suggests that the financial system is “essentially sound and resilient”, there is a scope for improvements like poor bankruptcy workout mechanism that hinders efficient resource allocation. 

The report also suggests a need to reduce government holding in banks to complete the unfinished task. Finally, very few countries can today take pride for ‘no discernible concerns’ on their financial sector and we are one of them.

Frontier at home

The article points to the lack of consensus in the Pakistan polity which is the main hurdle to their fight against terrorism and a major catalyst for the spread of Taliban and Al Qaeda forces in the state.

While it was heartening to see Pakistani security forces exulting after capturing a terrorist in the Lahore police training centre attack, the attack once again underscores the fact that terrorists have moved from Frontier to mainland Pakistan. The question is whether Pakistan’s political class has that consensus to take on these extremists? While for India, it would be now harder to maintain that the will of Pakistani state would help vanishing terrorism, for US it just means more fierce battle for Allied forces in Afghanistan region. For Pakistan, however, it now faces more bitter and entrenched foe while they continue to lack the political accord. Political consensus comes as a prerequisite before any proper counter-insurgency plan. Till then the Obama’s strategy on Af-Pak problem remains on paper. 

For India, it is all the more important, first, to make realize its neighboring state the internal enemy, and then aid them in declaring the battle against the common enemy. 

Professionals in the race

The article talks about the new trend of professionals joining the political race to the lower house of 2009. However, it specifies that it’s not the qualifications or the education of the candidate that makes him winnable, but to which class of people he appeals that makes him the right candidate.

Till now, middle class and political class were always on the opposite ends with one boycotting the other. Middle class refrained from voting while political class made dear with more active and volatile caste and communal votebanks. But the times have changed as more and more professionals join the election race either from a political party or even as independent. But just to mention that even before this, political parties were never short of lawyers, engineers, bankers, teachers, managers or other qualified professionals. Qualifications never qualify a person to represent the public or stamp his social awareness and inclination for public service. The differences between the need of the rural electorate and the urban one in India makes it difficult for any person to represent both in an election. Only he, who can appeal to both the classes, can truly represent them. 

Independent aspirants should also remember that it is not only the political parties who select the candidates based upon their winnability factor, but also the public who vote on the same principle.