Sharapova wins French Open for 2nd time
She beat Simona Halep 6-4, 6-7 (5), 6-4 in the final

Sharapova won her second title at Roland Garros in the last three years, overcoming 12 double-faults Saturday to beat fourth-seeded Simona Halep 6—4, 6—7 (5), 6—4 in the final.

“This is the toughest Grand Slam final I’ve ever played,” Sharapova said on court

Tackling India’s economic headwinds

The problems of the economy stem from macroeconomic imbalances and corruption and unless they are addressed, the economy will not recover. The need today is not only for decisive leadership but also for a new, holistic macroeconomic approach

The Bharatiya Janata Party’s dramatic electoral victory is partly the result of the United Progressive Alliance’s failure to tackle the problems affecting India’s economy. A high rate of inflation that persists, declining growth, inadequate employment generation, fiscal deficit, current account deficit (CAD) and corruption all contributed to public disenchantment with the UPA. Therefore, expectations are high that the new government will tackle these problems decisively and bring relief to the public.

The economy’s rate of growth has declined every quarter since the end of 2010-11, i.e., for the last 12 quarters. The industrial sector has shown negative or near zero rates of growth. The services sector, the engine of growth for the economy, has experienced declining rates of growth. So has agriculture. In turn, this has led to sluggish employment generation. The problem has been compounded by the capital intensive nature of current investment which uses less labour and more capital, so that even when output rises, employment hardly grows. Most are forced to work in the informal sector at low wages which when coupled with high persisting inflation, causes economic distress and political unrest.

Increase in inequality

This state of affairs is due to the decline in the rate of investment from its peak of 38 per cent in 2007-08 because of the global economic crisis. It went up in 2009-10 but is down to about 32 per cent. It is still high compared to the figure of around 20-23 per cent in the 1990s. It rapidly increased in the 2000s leading to the boom of 2003-2008. The rapid increase in investment was engineered by allowing national income to shift rapidly in favour of the high savers — those who have high property incomes. This was evident from the direct tax data which showed that corporate tax collections boomed after 1999. This trend has led to a rapid increase in inequality in society and a slow rise in mass consumption so that the growth of the economy has depended more than before on rising investment levels.

Hence the crucial determinant of growth in the economy in the period after 2000 has been investment. As the investment rate declined after 2010-11, the rate of growth of the economy fell. Investment in the economy depends on private investment, both foreign and domestic and on public investment. There has been a problem with each one of them.

The BJP manifesto only presents a hint of its macroeconomic plan. Hopefully, the Union Budget will help clarify matters

Discredited model of investment

The situation has been aggravated by developments on the external and the fiscal fronts. The green shoots in the United States did not bloom, Eurozone went into a double dip recession, Japan continued its sluggish growth and the Chinese and the other BRICS economies slowed down. Thus, the growth rate of exports has been low. But, imports rose sharply due to the high import bill for petro products and the increase in the gold import bill. The consequence has been a high trade deficit and CAD and a decline in demand in the economy. This has also been accompanied by a reduced inflow of foreign investments so that the value of the rupee vis-à-vis the dollar declined sharply in the last few years. This added to the imbalance on the external front with speculation and a flight of capital aggravating it. The threat by credit rating agencies to downgrade the country has been looming large which could lead to an increase in cost of borrowing abroad and a rise in CAD.

Foreign investment has slowed down but it only constitutes around 10 per cent of the total investment in the economy. The bulk of investment is internal and this has slowed down due to several factors. One of them has been the unravelling of scams since 2009 and the subsequent intervention of courts. This has impacted the confidence of the business community which was used to employing crooked means to manage its investments and the markets. After the court interventions, there have been question marks over many decisions like allotment of spectrum, coal blocks and iron ore mining. This has unnerved businessmen who have lost the confidence that they can manage the business environment the old way.

Their confidence has also been shattered by widespread public protest against large-scale acquisition of land needed for major projects. This goes back to the days even before Singur. Resistance has continued in Jaitapur, Kudankulam, POSCO, Tata Mundra and so on. Some big ticket investment projects like the $12-billion project by the Mittals have been called off. The problem remains unresolved because the public perceives a loot of natural resources — land, air, water, spectrum, forests and mines — at its expense. So, the execution of big projects has slowed down. The private corporate sector has been flush with funds which it has not invested due to the uncertainty and sluggish demand in the economy. In brief, the slowdown in internal investment is a result of the discredited model of investment in the country which has been based on collusion between businessmen, politicians and the bureaucracy. Thus, for different reasons, both foreign and domestic private investment has slowed down.

The last element, public investment has also slowed down because of policy paralysis in the government and even more importantly due to the sharp cutback in Plan size in each of the last five years so as to keep the fiscal deficit down; compared to budget estimates, the actual has been less by Rs.5 lakh crore in these five years. This has led to a slowdown in investment in infrastructure and an aggravation of shortages.

Because of the slowdown in the economy, tax revenue increase has suffered. That is why the fiscal deficit has tended to increase. To keep it in check, the Plan size has been curtailed. But that sets up a vicious negative cycle. As the economy slows down, the threat of a downgrade by credit rating agencies increases, revenues of the government rise less and the deficit tends to rise, both of which lead to a loss of confidence and a further slowdown.

Can the new government tackle the difficult economic situation? Prime Minister Narendra Modi is reputed to be a “man of action” but the issue here is what action? The corporate sector has backed him in the hope that he will reverse the misfortunes of industry. The stock markets have risen sharply in the last few weeks. Can the new government simultaneously fulfil the hopes of business and those of underemployed youth hoping for a miracle?

Improving investor confidence

While the rise in the stock markets signals the flow of funds from FII, it does not mean that foreign direct investment will suddenly increase. Further, there is the danger of a speculative bubble building up — as in the past — which could collapse and adversely impact the investment climate. This could be triggered by the continuing easing of the Fed intervention in the U.S. — something that is ongoing. Even if foreign investment increases, it is a small part of the total investment so it cannot be the major stimulus needed. Domestic investment — public and private — needs to be revived. Large investment is going to remain hamstrung by environmental and other clearances and difficulties in acquisition of land unless laws are changed but that would take time. Transparency in business decisions is needed to revive investment, which also needs time. So, the only thing that can be done soon is to increase public investment, especially in rural areas where infrastructure is woefully inadequate.

Schools, dispensaries, roads, telecom, water, small irrigation and so on are needed urgently in rural India. This has the potential to create lots of jobs unlike the big investments and would be much less expensive than in urban areas because land is less expensive. Thus, it would benefit many more people and slow down the expensive and environmentally damaging urbanisation currently taking place. But this requires efficient governance.

In brief, the problems of the economy stem from the macroeconomic imbalances and corruption and unless they are addressed, the economy will not recover. The need today is not only for decisive leadership but also for a new, holistic macroeconomic approach — a break from the UPA’s policies. Unfortunately, the BJP manifesto only presents a hint of its macroeconomic plan and that too towards the end of the manifesto, as if like an afterthought. Hopefully, the Union Budget will help clarify matters.

Kundankulam Nuclear Power Plant became the first nuclear plant in India to generate 1,000 MWe of power.

The first reactor of the Kudankulam Nuclear Power Project attained its maximum rated generation capacity of 1,000 MWe on Saturday afternoon, marking a final technical milestone in the tumultuous history of the atomic project coming up on the Tamil Nadu coast.
This wraps up a gradual three-stage ramping up of power levels in the first reactor of the project that was initiated by NPCIL — the state-owned operator of the project — last year. It signifies that the reactor is almost ready for commercial power generation, 11 months after it attained criticality in July 2013 and over 14 years after the “first pour of concrete” way back in March 2002.
At 1,000 MWe, Kudankulam-I is now also the single largest power generating unit in the country, higher than the 800 MW thermal sets deployed at the Tata Mundra project in Gujarat that had the distinction of being the largest single generation units in operation. The largest nuclear reactor units currently in operation have a capacity of 540 MWe while projects based on a range of 700 MWe indigenous pressurised heavy water reactors are currently under construction at two sites.
“At 13.20 hours today, Unit I of Kudankulam Nuclear Power Plant started generating its full capacity of 1,000 MWe of power,” said R S Sundar, site director, of the project. NPCIL is expected to run the unit for some more time before it stops it for conducting some tests as mandated by the nuclear regulator, the Atomic Energy Regulatory Board, NPCIL officials indicated.
After attaining criticality on July 13 last year, the Kudankulam project’s first reactor had to undergo a series of tests stipulated by the AERB and also by the Russian technology provider Atomstroyexport CJSC, and had to be shut down manually on a couple of occasions. Though the commissioning of the first of the 2X1,000 MWe reactors was originally planned in five years from the date of the “first pour of concrete”, the adoption of the new Light Water Reactor technology for the NPCIL engineers, delays in the supply of components, the task of building in additional safety measures after the Fukushima incident, anti-Kudankulam protests, contributed to delays.
Since achieving criticality, power generation has been gradually raised by state-owned NPCIL, the operator, to 500 MWe, 750 MWe and finally to 1,000 MWe in stages. At every stage, various tests were conducted and the technical parameters verified. Based on the results of the tests at each of the stages and with AERB clearances, the subsequent stages were attained.

Maths internal breakup in last 3 CSAT
Maths Topic Subtopic 2011 2012 2013
Basic HCF,LCM 1 0 1
Ratio Proportion 1 1 4
Linear EQ 1 0 1
Subtotal: Basic 3 1 6
STDW Speed Time Distance Work 2 1 4
Stat averages 1 1 0
Data Interpretation (DI) Pie chart 2 0 5
Tabulation 3 0 0
Speedgraphs Interpretation 3 0 1
Bacterial growth 3 0 0
Age pyramid 1 0 0
Subtotal: DI 12 0 6
oddballs Permutation combination (how many figures possible etc.) 3 0 0
geometry 1 0 0
AP, GP 1 0 1
Subtotal: Odd balls 5 0 1
Maths Total Basic+Stat+STD+DI 23 3 17
% out of 80 MCQs 28.75 3.75 21.25

CSO releases provisional estimates of national income for the financial year 2013-14

The Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation, released the provisional estimates of national income for the financial year 2013-14 and the quarterly estimates of Gross Domestic Product (GDP) for the fourth quarter (January-March) of 2013-14, both at constant (2004-05) and current prices.It also released corresponding annual and quarterly estimates of Expenditure components of the GDP in current and constant (2004-05) prices, namely the private final consumption expenditure, government final consumption expenditure, gross fixed capital formation, change in stocks, valuables, and net exports.
Estimates at current prices:

GDP at factor cost at current prices in the year 2013-14 is estimated at Rs 104.73 lakh crore, showing a growth rate of 11.5% over the First Revised Estimates of GDP for the year 2012-13 of Rs 93.89 lakh crore, released on January 31, 2014.
Gross National Income (GNI) at factor cost at current prices is now estimated at Rs 103.45 lakh crore during 2013-14, as compared to Rs 92.72 lakh crore during 2012-13, showing a rise of 11.6%.
Per capita income at current prices during 2013-14 is estimated to have attained a level of Rs 74,380 as compared to the First Revised Estimates for the year 2012-13 of Rs 67,839 showing a rise of 9.6%.

Telangana now officially 29th state of India

Telangana formally became the country’s 29th state of India and Telangana Rashtra Samithi (TRS) chief K Chandrasekhar Rao (KCR) took oath as Telangana’s first Chief Minister. Telangana consists of the 10 north-western districts of Andhra Pradesh.

Backgrounder:

In the history of India, it happened for the first time that outside Hindi and Bengali speaking areas, 2 states speaking the same language have been created (Telangana and AP are both Telugu speaking states. In addition to more than one Hindi speaking state, there are two Bengali speaking states: West Bengal and Tripura.

This essentially challenges the roots (the linguistic basis of states in which language being believed as the measure for a similar culture) on which during the first decade after Independence, the internal map of the Indian Union was re-drawn. This essentially now leaves a space for an additional exercise to redraw the internal map of India.

Albeit there was a request for a combined Telugu state even previous to our Independence, the Nehru-led regime formed AP (Andhra Pradesh) owing to vested political interests of the Congress leaders. Now, History has completed a circle.

The Congress faced a hard electoral contest from the Communists in the Andhra state that was in 1953 sliced out of the Telugu speaking regions of then Madras state. Thus, it was settled to combine Andhra with the Telugu speaking parts of the territory of the ousted Nizam of Hyderabad, so as to form a bigger state where the communists could be whitewashed.

The next unspoken motive of the Nehru regime was that, after being humiliated by the experience of the integration of Kashmir it, didn’t desire to let away the regions of the Nizam as they were. Consequently, whilst the Telugu language parts went to Andhra Pradesh, the Marathi and Kannada language parts went to Bombay and Mysore provinces.

This workout proved good for the Congress as it shaped a monopoly for the Congress in the 1977 post-Emergency elections. Albeit at the national level the Congress was badly beaten yet it won 41 of the 42 seats in Andhra Pradesh. The subsequent year, Indira Gandhi sailed back to the Lok Sabha from Medak.

But the Congress CMs (Chief Ministers) did nothing to encourage rural empowerment. The only CM (Mr. Narasimha Rao) who tried something, confronted resistance from vested interests and was sacked. Thus, rising rural anger led to Maoism in these areas.

In 1983, the Congress was substituted by the NT Rama Rao’s TDP (Telugu Desam Party). The son-in-law of Rama Rao, Chandrababu Naidu, became the first CM all ever in India to hold on to economic developments. Chandrababu Naidu soon turned capital city Hyderabad into an IT hub. But the rural areas were ignored and suicide by farmers rose. Shortly an isolated drive started in the state with the people of Telangana supposing that they would be well off as an independent state. Thus in 2004, Chandrababu Naidu was substituted by Congressman Y.S. Rajasekhara Reddy. Reddy began a rule of “free-ships” (viz. free electricity, fee refunds to students, free houses, free medical care et al). Albeit these efforts taxed the exchequer but transformed into significant electoral gains for the Congress, permitting it to make a government at the centre. Subsequent to the sudden death of YSR, the Congress went into a panic state. In 2014, in order to benefit on apparent political gain, Congress passed a bill to split the state. Unluckily for the Congress, the attempt proved futile to gain it political bonus and it was deeply rejected in both areas.

Anand Mahindra first Indian to be honoured with Harvard Medal

Mahindra Group Chairman Anand G Mahindra became the first Indian to be honoured with the prestigious Harvard Medal for his ‘dedication, generosity and service’ to the university. In 1977, Mahindra is an alumnus of the HarvardUniversity. He graduated with Honours (Magna Cum Laude) from Harvard College, Cambridge, Massachusetts. He completed his MBA from the Harvard Business School, Boston, Massachusetts in 1981.

Mahindra is the Co-founder of the Harvard Business School (HBS) Association of India and he is also a instituting member of the university’s South Asia Institute (SAI), the HBS India Research Center, and the SAI field office in Mumbai, India. In 2010, Mahindra made a gift of $10 million to the Humanities Centre which was then renamed the Mahindra Humanities Center in honor of his mother, Indira Mahindra.