G20: Words and Walls

Germany's finance minister calls the US economic model "in deep crisis" and describes the country's policy response as "clueless".

Germany regards the Federal Reserve's quantitative easing programme as a dangerous dance with inflation; the US sees it as a legitimate attempt to generate demand for the benefit of all.

"The issue of the Renminbi is one that is an irritant not just to the United States, but is an irritant to a lot of China's trading partners..." - Barack Obama

China says it risks social unrest if it allows the yuan to appreciate rapidly against the dollar.

 4% cap on current account surpluses - says Tim Geithner, U.S Treasury Secretary  - Germany slams this down.

"Smiling family photographs marking the attendance at international gatherings are no substitute for specific actions" (January) - Mervy King, Governor Bank of England

"The fear we should all have is a return to what happened in the 30s: protectionism, trade barriers, currency wars, countries pursuing beggar my neighbour policies – trying to do well for themselves but not caring about the rest of the world. That is the danger..."
"Now on the big battle, the biggest issue of all is the cause of the last crisis – a wall of money in the east, a wall of debt in the west. We've got to deal with that imbalance and I think it's a real test for this summit and one that Britain will play a very positive part in trying to make sure we really look at these imbalances and deal with them." - David Cameron

Just for some perspective, it's important to see who is a surplus country and who is a deficit country.

"Recycling surplus savings into investment in developing countries will not only address the immediate demand imbalance, it will also help to address developmental imbalances. In other words, we should leverage imbalances of one kind to redress imbalances of the other kind." - says Dr. Manmohan Singh


Our PM also says we must avoid competitive devaluation and protectionism. He said advanced deficit countries should move towards fiscal consolidation and sustainable borrowing. For rebalancing of global demand he suggests the advanced deficit countries should work on their competitiveness and efficiency. And the surplus countries should increase domestic demand. And finally he added that countries must not manipulate their exchange rates.

Democracy's Shining Hero

Aung San Suu Kyi's release will end one of the worst violations of democratic right and liberty. If this brings in the needed democratic values into Burma, with no strings attached then this marks the beginning of true empowerment for the people of Burma. But if there will be conditions put on her freedom, then just like before we should expect her to break them. But let's hope this is for real and there will be no looking back from here.

"There is a time to be quiet and a time to talk. People must work in unison. Only then can we achieve our goal.", she said after her release.

On Obama's Promise

Okay there's a lot of talk on how disappointing Obama's visit has been. Added to that is a lot of talk about how the promise of India's permanent seat in UNSC is just an empty promise. And that India, Germany, Brazil and Japan are all equally good candidates but there's no guarantee US' backing can get any one's membership through.

Obama's offers for future collaboration in areas ranging from Agriculture to Education to Governance and the deals already signed between businesses from the two nations in Bombay clearly indicate the potential of the relationship that will deepen further.

If at all we face any heat from Pakistan or China, we know we have the support of the most powerful nation in the world. When Obama says India should engage East and not just look East it clearly indicates the leadership role U.S expects India to boldly take up in the region and India knows that it is beneficial strategically to both nations.

As for the promise of permanent membership in UNSC, Obama's visit has helped create some noise. It's like the long campaign in the run up to elections. In this period of time, media will write about the deepening relationship between the two nations, experts will debate, and UN permanent members - China, U.K, Russia and France will observe closely. It's not just our actions or good deeds we have to watch out for like being a good boy in the run up to Christmas will get you what you wish for from Santa, it's the only way to do it in that case, no deals allowed with Santa.

But in this case we have options to negotiate, cooperate and make smart choices. Besides U.S is not our only 'friend' or 'partner' we can send our wish list to. There will always be people saying it's all empty talk, but that just shows lack of ambition and courage. And India today is lacking in anything but those two.

The Amazing Rare Earth Race

Our edge - We are the second largest producer of rare earth after China. We have the share of about 2% of the world output. The race for rare earth elements is making India change a lot of its strategies.

The government is firming up plans to triple rare earths production from 2,700 tonnes to 7,700 tonnes by the end of 2011, according to R.N. Patra, chairman of Indian Rare Earths Ltd (IREL), a state-run firm set up in 1950.

India signed a deal to supply rare earths to Japan. China banned exports of rare earths to Japan in protest against the detention of a Chinese fishing boat captain who had strayed into Japanese waters that are claimed by China.

Here's an article that predicts trade war because of the rare earth race.
http://news.discovery.com/earth/rare-earth-metals-trade-wars.html

The rare earth's story - http://dl.dropbox.com/u/5973996/Users/Rajendra/Rare%20Earth_Indetail.pdf - what are the elements and what will they do for us in the future.

Not just the fancy high-tech things...check this out - The neo cube

Composed of 216 individual high-energy rare-earth magnets, the NeoCube allows you to create and recreate an outrageous number of shapes and patterns.

UNSC here we come!

What does it mean to be a permanent member of the UN Security Council? Here's what I think it means. It means that India would now be part of efforts to maintain democracy and peace in areas that seriously lack the two. It would mean that if there are military interventions to do the same anywhere in the world, India might have a say but will at all times have to act. India cannot anymore be diplomatic and not be vocal about its stand on international issues such as peace and human rights violations. Obama said with power comes responsibility. He spoke in length about Gandhi. All this to drive home the point that it's not just about having 8.5% GDP growth anymore or it's not going to be enough to command the kind of attention and respect we do now by just being economically one of the fastest economies of the world, but from now on we will have to play the role of an aggressive nation that believes through these kind of international partnerships, the world can be made better through actively leading the parts of the world that need to be led.

Phew! This sounds like a lot. These issues are inevitable but complex. It's not easy to be in the limelight. Upsetting people off at this stage would be trouble. It's time to get our priorities straight, it'll help us be a better leader globally. We can either lead and influence or we're not there in the big league. No more shying away, we need the world to know our opinions, our opinions will count. So what are our stands on Afghanistan, Israel, Iran, Burma and China ? Or is Pakistan all we care about? Or is Pakistan the reason we want to be in the UNSC? Will this limit our freedom of opinion or increase it? Or is it somewhere in the middle? Is it better then to have all the power and call the shots or is it better to handle the more complex situation where in the real world we have to share these spheres of influences with people sticking around for different reasons and interests and stakes.

Will we make more enemies or more friends? At what costs?

It is indeed an opportunity for us to show that we can be strong and put our feet down when we have to and that we have the right to do so now when it comes to security and peace. This is an opportunity like never before to officially become the leader of South and East Asia, that is very much needed if the region is to become together the region of the world's strongest economies.

"...with great power there must also be great responsibility..."

But India will now have to make choices that, get our priorities right and show that we need not only be about the problems but we can now be part of the solutions to the problems of the world.

"Whatever comes our way, whatever battle we have raging inside us, we always have a choice. We can choose to be the best of ourselves. It's the choices that make us who we are, and we can always choose to do what's right."

Our generation is officially the luckiest generation to be witnessing the most exciting times in the life of this great nation. And it's only just begun.