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India and Pakistan's chilly silence is broken at New Delhi talks. Maoist rebels offer a cease-fire and talks, but the government remains cautious. India sees economically-favorable demographic trends. The economy is expected to grow to pre-economic crisis rates in the next fiscal year. Parliament receives a budget that will significantly reign in the deficit. Maruti Suzuki recalls 100,000 hatchbacks. The government expects to make billions by auctioning 3G licenses. And painter Maqbool Fida Hussain is offered honorary citizenship in Qatar.
Top News: Indian and Pakistani diplomats met in New Delhi for official talks for the first time since the 2008 terror attacks on Mumbai. As expected, there was no diplomatic breakthrough, not even a customary joint statement. During the talks, India focused on the terror attacks launched by Islamic groups it says are based in Pakistan and asked the country’s government to act against the groups. India ruled out any resumption of broader dialogue on other issues such as the decades-old dispute over the territory of Kashmir. On the other hand, Pakistan said it was defending itself against internal Islamist terror. The futility of the talks was highlighted by newspaper headlines. One of them read, “India-Pak – new round, old story,” but there was no denying that the talks broke a 15-month silence between the two nuclear-armed neighbors.
A top Maoist rebel leader, Kishenji, offered a cease-fire and talks but India’s government reacted cautiously. Home minister Palaniappan Chidambaram said he wanted no pre-conditions for talks. The offer came as India has mounted a furious offensive called Operation Green Hunt against the Maoists in the thick forests that they operate in. The Maoist movement in India, inspired by the Chinese revolutionary Mao Zedong, has fought a bitter, violent, four decade war demanding that the poor and landless receive jobs and land. Thousands have been killed on both sides in the ongoing violence and Prime Minister Manmohan Singh has described them as India’s biggest internal security threat. In response to the government offensive, the rebels recently raided a security camp southwest of Kolkata city in eastern India and killed two dozen personnel.
India will see a favorable demographic momentum in the coming decades, compared with its neighbor China, which will bode well for its economic future. A growing population of young people means a pattern of working, saving and investing that will be to India’s advantage, says a study by Deutsche Bank Research. India’s working age population will be 240 million over the next two decades, equal to four times the total population of the United Kingdom.
Money: The economy will grow 8.75 percent in the fiscal year starting in April, says a forecast by India’s finance ministry. The prediction came in the annual Economic Survey document which says the country will get on track to the pre-economic crisis growth rates in the coming financial year. The concern about soaring food prices, however, remains. In the current year ending on March 31, growth is estimated at 7.5 percent.
The budget that was presented to the Parliament by the country’s finance minister in late February has set the stage for a calculated withdrawal of economic stimulus funds that were introduced at the height of the global economic crisis. The government wants to rein in the growing fiscal deficit, which is now at 6.9 percent of the GDP.
Another report by the government’s Finance Commission said the government could earn funds to the tune of nearly 0.88 percent of the GDP if it pursues a rigorous disinvestment policy for the next five years. The government owns 473 companies worth about $500 billion or 45 percent of the country’s GDP.
India’s top carmaker, Maruti Suzuki, majority-owned by Japan’s small carmaker Suzuki Motor, announced that it was recalling 100,000 A-Star hatchbacks to fix a potential fuel leak. Suzuki’s Indian announcement came on the back of its Japanese rivals Toyota and Honda declaring recalls of their models. The A-Star sells in India and also exports to several countries in Europe. The recall was first conveyed to European authorities but was not disclosed in India. Maruti defended this non-disclosure saying India did not have a recall policy. The company said there was no attempt to hush up the matter.
India’s much-delayed auction of 3G licenses has been pushed to the next fiscal year and will likely happen in April. According to a new schedule released by the government, applications will be issued shortly and the last date for submission is March 19. Several Indian and multinational mobile service providers are eager to bid for the 3G licenses. The government expects to raise over $5 billion from the auction.
Elsewhere: India’s best-known contemporary painter, Maqbool Fida Hussain, 95, often described as India’s Picasso, has been offered and accepted honorary citizenship from Qatar. Since India does not allow dual citizenship, the country’s most famous artist will have to renounce his citizenship. Hussain fled to Dubai several years ago and has lived there in self-imposed exile following threats to his life from some right-wing groups. They object to his depiction of Hindu goddesses in his paintings and say these denigrate Indian culture.