The basics of Indian Politics - how corruption starts from base

I was thinking from long time to post this but was not getting time for the same, finally I managed to spare some time to tell about the basic functionality model of Indian politics and why it is often referred as politics led by goons. I request to please post your views about the same in the comment section.

It is true that most of the Indian politician are goons who win election by distributing money among the poor people, and the politicians are most after the poor people who can be purchased by distributing a couple of whiskey bottles or by few thousand rupees, which comes down to few hundred rupees in case of Bihar.

I was wondering how can so much dirt get into system that too at every level. well I got answer in few days and here is what I concluded.

Most of the poor people or low income group people(bus drivers, Auto drivers, sweepers ) to list a few are the ones who are very fond of politics not because they like it but to earn money, A person who has no work, no job to earn money is type of hired by the local politician at not much wages but given a commitment that if he/she wins in smallest level election then there would be lots of money around and the person (having no money presently) says a yes and becomes a chela of that to be politician. Now the task is how to earn votes in coming general body election or any other election, Since they have not done anything good for the people but still want to win, they start corrupt practices like giving warnings to people to cast them or face the music(taking advantage of weak police system), In India Police can be termed as goons hired by politicians legally to take money from the literate(well settled individuals). but in case of poor people they dont give such warnings(because they will get nothing in case they even kill the person for not casting the vote to them) So they purchase their votes by paying a meagre amount while also maintaining some sort of ledger of the money spent on whole election campaign. Since they start from smaller area hence people to purchase is very less hence the budget is fixed too. Once they win the election by giving money, bribing police, they feel very happy and first take out the money out from government funds(which is indirectly the taxes collected from the well settled people).

They charge compound interest for their money and fill their stomachs and houses as this stolen money would now become input for purchasing votes for the next level of elections(which covers larger geographical area), The person who helped initially now becomes a legal goon which is used for killing a competitor and the police is used by same politician to show it as either a suicide or road accident(I have not heard of any third type of killing strategy used by the politicians in India for killing of their competitors).

Now when he follows the same strategy and wins the elections again then he becomes the god of the area, which gives him power to do all the illegal activities, drugs, call girls mafias, murders, licenses to builders etc. From all these activities the percentage of now minister's share reaches at end of the day or weekly or monthly(depends on how the politician wants that money) and this is all hard cash. Local police helps in watching that all the illegal activities are going on nicely and they are getting their share at time.

The things shown in movie Rajneeti are very true(however it depicted only the killing of competitors part, I discussed earlier). Now since the whole nexus created by the politician of that area is functioning smoothly he makes a lot of money.

The tragedy here for medium income group or middle class people is that their vote has no effect as the number of poor people surpasses them and would always be the same in future too. but the money which goes into politicians pocket is the one from their taxes :(

Hence no politician ever talks about providing jobs to the people as in that case their own job would end because they know the truth about their doings and no person would ever want that his/her source of income should stop.

So this was my try to depict the working of indian pilitics and indian politicians(in which the middle income group has no effect)

PLEASE GIVE YOUR COMMENTS ABOUT WHAT TO FEEL ABOUT THIS

Core investment norms released by RBI

Reserve Bank of India on Friday said core investment companies with assets over Rs 1 billion will be required to obtain certificate of registration from it while the ones below Rs 1 billion need not.

A core investment company means a non-banking finance company which holds not less than 90 per cent of its total assets in the form of investment in equity shares, preference shares, debt or loans in group companies, the bank said.

Indian Forex reserves at $ 287 billion

India's foreign exchange reserves rose to $287.356 billion as on August 6, from $284.183 billion in the previous week, the Reserve Bank of India (RBI).

Foreign exchange reserves include India's Reserve Tranche position in the International Monetary Fund (IMF), the RBI said.

14000 crores as subsidy to Oil Cos

The government will give Rs 14,000 crore in cash to Indian Oil, Bharat Petroleum and Hindustan Petroleum to make up for the losses incurred on selling fuel below cost in the first quarter of 2010-11 fiscal.

The Finance Ministry today sought parliamentary approval for additional spending of Rs 68,294.30 crore that included Rs 14,000 crore "for providing compensation to oil marketing companies towards estimated under-recoveries on account of sale of petroleum products."

Retailers IOC, BPCL and HPCL lost about Rs 20,275 crore on selling petrol, diesel, domestic LPG and kerosene below cost in the first quarter of this fiscal. Of these, losses of upstream firms like Oil and Natural Gas Corp (ONGC), made up for one-third or Rs 6,690.68 crore.

Key rates decision after analysing Inflation problem root - RBI

The Reserve Bank of India's (RBI) monetary stance will depend on whether it perceives inflation as stemming from excessive liquidity or due to supply constraints, the country's top civil servant said.

On Tuesday, Cabinet Secretary K.M. Chandrasekhar allayed concerns of persistently high prices, reiterating the government's forecast of headline inflation easing to 5-6 percent by the end of the year.

India's annual headline inflation stayed above 10 percent for the fifth straight month in June, cementing expectations the RBI will raise interest rates for a second time this month to contain price pressures.

A majority of economists expect the RBI to raise key interest rates by 25 basis points in its quarterly review on July 27 and tighten policy further in coming quarters, a new Reuters poll showed.

"A call will have to be taken by the Reserve Bank (RBI) on whether inflation is on account of high money supply or is it on account of certain sectoral reasons, some supply constraints," Chandrasekhar told a news conference.

Some analysts have pegged capacity constraints in the rapidly expanding economy as the main reason for a surge in non-food inflation, pointing out a slowdown in May industrial output, despite robust domestic consumer demand.

Further, expansion in the M3 money supply, the broadest measure of liquidity in the system, has just picked up after slowing down since the year began and lags credit expansion.

Exports to EU countries increases

According to latest report exports to EU union have increase YoY. So does it mean that EU is coming out of bad times...The answer might not be so easy currently, have to wait for another quarter for sure to analyse.

Details:

Exports from India to the 27-member EU increased by 18 percent to 10.7 billion euros in January-April 2010, compared to 9.1 billion euros in the corresponding period last year. and also Exports from the European Union (EU) to India shot up by 28 percent to 10.6 billion euros (about $13 billion) between January and April 2010, compared to 8.3 billion euros in the corresponding period last year,

Good Move - Rs 8000 crores for mid day meal scheme

This year the Centre has alloted rs 8000 crore for the mid day meal scheme , hence there would be more enrolment for schools for sure thus increasing the number of literates in country.

Flashing back to midday scheme: Mid-day meal scheme was first evolved by former Tamil Nadu chief minister K Kamaraj and now it has been taken as a role model for the entire country.

Pathetic - Gujarat Gov unable to collect Tax dues

The booming economy of Gujarat has a darker side too.. as their are many big companies which do not pay their taxes and Owe 4000 crores as taxes from 2006 onwards.

The biggest revenue churner for the state government — the commercial tax department that accounts for 60-70 per cent of the state government’s revenue — may have breathed down a small trader’s neck to recover dues. The department , however, find it difficult to explain why they have been unable to recover Rs 4,775 crore from 13 major units in the state since 2006. The amount includes Rs 1,264 crore in interest.

Indian Economy's GDP pegged at 5 perc for 2010-11

Indian Economy's fiscal deficit for year 2010-11 is predicted to be in line of 5 percent of GDP according to Nomura. Which means it is much less then the predicted.

The government is also looking at raising Rs 40,000 crore through disinvestment this fiscal. It has already raised over Rs 1.06 lakh crore from the sale of spectrum for 3G and Broadband Wireless Services (BWA) services.

The research firm also said that one-off expenses on pay arrears and fiscal stimulus are set to fade. Hence government would borrow 15000 crores less in this financial year.

I am waiting when India would see it's first budget with zero deficit, that day will be golden day for Indian Economy....cheers!!