Recession Nearing in !! Which Company to Choose ?? Will IT Industry Sustain ??

As we see the European Countries are plunging into recession. They have been hit straight for sixth quarter larger than 2008-09 recession.

Normally now questions Arise? Will IT Industry be Safe for Settlement ? Shifting Jobs even before they Remove ? Normally all the software professionals 

Eurozone recession extends into 6th quarter ...worser than compared to 2008-09 !!

The recession across the economy of the 17 European Union countries that use the euro extended into its sixth quarter _ longer than the calamitous slump that hit the region in the financial crisis of 2008-9. 

Eurostat, the EU's statistics office, said Wednesday that nine of the 17 eurozone countries are in recession, with France a notable addition to the list. Overall, the euro region's economy contracted 0.2 percent in the January-March period from the previous three months. 

Though that's an improvement on the previous quarter's 0.6 percent decline, it's another unwelcome landmark for the single currency bloc as it grapples with a debt crisis which has forced governments to slash spending and raise taxes. 

These austerity measures have inflicted severe economic pain and social unrest. Unemployment across the eurozone is currently at a record high of 12.1 percent _ in some countries, such as Greece, it's as high as 27.2 percent. 

Though this recession is not nearly as deep as the one in 2008-9, it is the longest in the history of the euro, which was launched in 1999. A recession is officially defined as two straight quarters of negative growth. 

``The eurozone is facing a double blow from necessary restructuring of its domestic economy and somewhat disappointing growth in world trade, in particular demand from emerging markets,'' said Marie Diron, senior economic adviser to Ernst & Young. 

There was also bad news for the wider 27-country EU, which includes non-euro members such as Britain and Poland. It too is now officially in recession after shrinking by a quarterly rate of 0.1 percent in the first quarter, following a 0.5 percent drop in the previous period. 

With a population of more than half a billion people, the EU is the world's largest export market. If it remains stuck in reverse, order books for companies in the US and Asia will be hit. Last month, US-based Ford Motor Co. lost $462 million in Europe and called the outlook there ``uncertain.'' 

Other major economies have faltered this year but none are in recession. The annualized contraction in the eurozone of around 0.9 percent contrasts with the equivalent expansion of the US of 2.5 percent. 

For many analysts, that discrepancy highlights Europe's flawed economic approach since the end of the financial crisis. Instead of keeping the spending taps on _ as the US has largely done _ the region concentrated on austerity even though companies and consumers weren't able to plug the gap left by the retrenching state. 

However, there have been some recent indications that Europe's leaders are willing to ease up on their adherence to cuts and tax rises at a time of recession. Some countries, for example, are being given more time to meet certain economic and financial targets. 

Despite the latest relaxation of rules _ and an easing of concerns over the debt crisis in financial markets _ most economists think the eurozone will remain in recession in the second quarter. Growth is then expected to emerge in the second half of the year _ but it isn't expected to amount to much. 

In its spring economic forecast, the European Union's executive arm, the Commission, predicted that the eurozone will shrink 0.4 percent this year, better than the 0.6 percent contraction in 2012. 

The eurozone has been in recession since the fourth quarter of 2011. Initially it was just the countries at the forefront of its debt crisis, such as Greece and Portugal that were contracting. 

But the malaise is now spreading to the so-called core countries. Figures Wednesday showed Germany, Europe's largest economy, grew by a less-than-anticipated quarterly rate of 0.1 percent, largely because of a severe winter. 

Germany's paltry growth still allowed it to avoid a recession following the previous quarter's 0.7 percent fall, when orders for the country's high-value good from its struggling euro neighbors declined. 

Aam Aadmi party raises questions on Government's Vodafone strategy ?? 11000 crores tax has been exempted for Vodafone by Telecom and Law Minister Sibal ??

The Aam Aadmi Party on Wednesday raised questions on the "haste" in which Law Ministry within a day of Kapil Sibal taking charge gave its go-ahead for a conciliatory out-of-court settlement of over Rs 11,000 crore tax dispute with Vodafone that marked a change in stance.

At a press conference, AAP's Arvind Kejriwal and Prashant Bhushan also alleged that Sibal has a "conflict of interest" in the case involving Vodafone as his lawyer son Amit "continues to defend" Hutchison, which had a partnership with the British telecom major

Questioning the "haste" in Sibal's decision, Kejriwal alleged that within 24 hours of assuming office he has started "indulging in corruption." Sibal got the additional charge of Law Ministry two days ago.

"What is the need for? He is doing this because his son is the lawyer of Hutch which sold its shares to Vodafone," he said.

Sources close to Sibal denied the allegation saying Amit was a lawyer for Vodafone between 2007 and 2009 and the Vodafone issue came up last year only. Sources also said his two sons did not take up any telecom case after he became Telecom Minister.

Amit also denied the allegations, terming it "completely false".

Download Indian Economy Notes for Prelims UPSC 2013

From Today onwards i will be uploading download links for the Notes Required for Prelims.

Indian Economy Notes - 1 [Mediafire Links]

Indian Economy Notes - 2 [Mediafire Links]

US Immigration Bill 2013. Tough Time for Companies like Infosys, Wipro ......etc !!

Yes, It will be really very tough time for majority workforce companies like Infosys, Wipro, TCS, Cognizant..and the list goes on.  The new Rules which has been imposed on them is really harsh. Most of the workforce required for these companies are graduates basically engineers from reputed institutions. Such kind of students you will find plenty in India. And they really love to do such jobs which send them to US.

But the new Immigration Bill that has been passed recently in April 2013 has caused a serious concern for these companies. The extra burden amount i.e. whooping $10k has to be paid for each individual employee who will be sent to US.

The effect of this Immigration Bill would definitely loosen the Trade  unity between India and United States of America. The proposed cap on H-1B visas will instead put a cap on economic growth in both the US and India.

Railway Minister Pawan Kumar Bansal Resigns !!!! Is it a Game being Played by Congress ????

Indian Railway Minister Pawan Kumar Bansal has set to resign today 10-05-2013.  There is nothing wrong in this. But what made me think twice  regarding resignation of railway minister is because of this statement made by congress.

" 

"Won't spare anybody mired in corruption", Congress had said today.

"

As elections are approaching soon, the congress people in order to gain popularity among the innocent Indian People. They made Pawan Kumar Bansal to resign as to show people How strict they are in terms or corruption. 
This is my opinion regarding Pawan Kumar Bansal Resignation.

Karnataka Elections 2013 - Why BJP lost elections ?? Why Bangalore does not gave BJP second Chance ?

A sense of the change in political winds in Karnataka is also evident with how Bangalore has voted. The state capital, which hugely favoured the BJP last time with hopes of development, chose to ignore it.

The Congress narrowly went past the BJP, bagging 13 of the 28 seats in the urban areas of Bangalore. The outgoing party won one less - 12. In the 2008 elections, the BJP had bagged 17  seats, riding on the back of a "sympathy factor" after the JD(S) refused to hand over power to the former, reneging on its promise on the coalition.

The results are significant in that the BJP clearly failed to win the metropolis' support despite roping in star campaigner Narendra Modi who addressed a massive rally in the city just a week ahead of the polls.

Mr Modi's development mantra clearly failed to cut ice with Bangaloreans who have been dealing with a nightmarish infrastructure and the infamous garbage menace that made headlines last year. The BJP which leads the city's civic body has failed to tackle the crisis on the solid waste disposal front - huge mounds of putrefying garbage piled across the streets in the city, leaving residents to deal with the stink.

The party's promise to the youth of an extended night life in the city, if it was voted back to power, has also failed to impress. The BJP which had been opposing growing demands for a longer night life in Bangalore, had said it will allow bars to serve liquor till midnight and eating joints to remain open till 1 am. At present, closing time for both is 11.30 pm.

Potential reasons for the recent decrease of the gold price

The price of gold fell from U.S. dollars 1,575 on April 10th more than 11% to U.S. dollars 1,395 on Tuesday, April 16th. Intraday the gold price had even fallen to as low as about U.S. dollars 1,322 per ounce.

On Tuesday, April 16th, the gold price started to recover a little bit and has currently increased to the U.S. dollars 1,3750 level. Investors are anxious, whether the abrupt decline of the gold price was just a – although quite hefty – correction or if they have to expect a further slide over the coming days and weeks.

Potential causes for the fall of the gold price

Various analysts and amateurs are currently coming up with their theories of what caused the drop. Below we state and analyze different potential causes for the fall of the gold price.

1. Market correction

The price of gold has increased for each of the last 10 years up to 2013, in total by more than 450%. Various analysts expected a correction of the gold price for quite some time. The overall extent of the current decrease is not unusual compared to the decline during previous corrections of the gold price. Although the speed of the correction was unsual with a drop by more than 15% (intraday) within just three trading days.

2. Cyprus gold sales

On Thursday, April 11, it was reported that the central Bank of Cyprus could eventually sell gold reserves in order to reduce debts. Many sources cited this as a cause for the drop of the gold price. But in February 2013, the value of Cyprus’ gold reserves stood only at about 550 million Euros. So the overall amount should – even if sold – not really put a strong pressure on the gold price. On the other hand, a potential sale could possibly act as a blueprint for debt reduction by other indebted countries like Portugal or Spain.

Another explanation would be that just the risk of a potential sale acted as the starting point for a chain reaction amongst investors, who became anxious, started to sell gold etc.

3. Less monetary easing

Ironically, while many gold bugs demand to reduce government spending and stop monetary easing, the growing chances that monetary easing could be reduced or stopped not too far in the future could now impact the gold price negatively. The reason is that monetary easing has created a lot of liquidity which poured into various asset classes including gold. A reversal could imply that money flows out of different asset classes including gold, i.e. that gold is sold by investors.

A stop of monetary easing could also mean that the risks for inflation in the future are possibly lower. Fear of inflation is a key buying argument for some gold investors.

4. Economic recovery

The key reason for the expectation that monetary easing could be ending in the U.S. is an economic recovery. In addition to the argument of less monetary easing, economic growth in the Western countries often leads to rising stock prices and less interest in gold as an asset class.

Interestingly, while gold demand in the Western countries is heavily driven by investment demand, which tends to be stronger in times of severe economic problems or crises, in Asian countries like China gold consumption is strongly positively correlated to economic growth. The better the economic development in countries like China, the higher is their demand for gold.

5. China

This brings us to the next often cited argument for the gold price decrease: Recent growth statistics for China were below expectations. As explained above, a slowing growth in China could lead to less demand for gold from China. Over the last years, China developed in a key consumer of global gold supply.

6. Gold import tax rates in India

India is the other key gold buyer in Asia besides China. The commodities guru Jim Rogers sees the 50% increase of the Indian import tax rate on gold at the beginning of this year as a potential cause for the weakness of the gold price.

7. Bitcoin

Jim Rogers also cites the recent collapse of the price of bitcoins – the alternative digial currency that increased significantly in value over the last years, but especially in the first months of 2013 – as a potential driver for the fall of the gold price. He argues that most of the investors who hold bitcoins would be also invested in gold – and therefore probably sell gold holdings after the fall of the value of their bitcoins.

8. Japan

The precious metals refiner Heraeus sees the monetary policy of Japan as a potential reason for the recent gold price decline. The Bank of Japan has announced measures to weaken the Yen. This drove the gold price measured in Japanese Yen to the highest level over the last 33 years. Heraeus says that a lot of private gold owners would therefore currently sell gold, which would drive down the gold price. Interestingly, with its huge debts and the new monetary policies, inflation risks should rise in Japan – in the longer-term this could potentially make gold a good investment especially for Japanese investors.

9. Technical or behavioural factors

Adrian Ash of the vaulted gold provider BullionVault writes that gold’s recent price chart looks horrible. When the gold price started to fall, it broke through several support levels.

This development could have started a ‘self-reinforcing cycle’, e.g. automated trading algorithms could have automatically started selling further positions in order to minimize losses and so on.

10. Hedge funds

While many private investors have a long-term view on their gold holdings, over the last years also a lot of speculative investors built gold positions. This was facilitated by new products like the gold ETFs, which are often bought by instutional investors, e.g. hedge funds. Those investors are acting very quickly and the negative development of the gold price has definitely led to sales by many institutional investors – which in turn strengthened the gold price slide.

11. Manipulation

There are some people, who believe market manipulation being reponsible for the decreasing gold price. A large share of the professionally traded gold positions is not traded physically but through contracts like futures. While these instruments can probably speed up a price movement, we do not believe that they are really effectively used to ‘manipulate’ the gold price.

But the shorter reaction times resulting from those new instruments could – comparable to high-frequency trading in the stock markets – accelerate and intensify price developments. This effect, coupled with technical or behavioural effects described above, could have made the gold market more vulnerable to fluctuations.

Given that large holdings of physical gold – in the hands of consumers, private investors or companies like jewellers – are at least in the short-term more or less “off the market”, the behaviours of large institutional investors can have significant short-term impacts on prices.

Conclusion and outlook

It is currently to early for a final conclusion of what the key drivers of the recent fall of the gold price were. As described, there are many different influencing factors – potentially it will never be possible to find the real causes for the price decline.

Over the coming days and weeks we will see, if the recent development was just a price correction or whether the gold cycle turned and we will see a longer bear market.

As often stated by us, private investors should be very careful, if they intend to speculate with gold. We see gold more as a kind of portfolio insurance that can help to diversify your assets and protect the value of your portfolio against big fluctuations or financial or other crises. But this implies that you should only invest a share of your assets in gold – as it applies to other asset classes.

Saudi Arabia "Nitaqat" Law . Is it a problem for Indians in Saudi ???

Yes Definitely, its a major problem for 2 millioin indians in saudi working. The reason is as follows:-

India has expressed its concerns to Saudi Arabia over the possibility of job losses of a large number of Indian workers in the kingdom because of a new labour law (Nitaqat).

Both the nations have set up a Joint Working Group (JWG) which will deliberate on framing a Memorandum of Understanding, which is to be a comprehensive document guiding all aspects of India-Saudi labour relations.

What is Nitaqat?

• The Nitaqat  is a new policy being placed by the Saudi government in order to reduce the unemployment rate among Saudi citizens.
• This policy makes it mandatory for Saudi Companies to reserve 10 percent of jobs for Saudi nationals.

Why Saudi Arabia is implementing such a policy?

• Saudi Arabia’s economy depends heavily on the existence of a large proportion of expatriates working for various establishments in the private and public sector.
• However, unlike the other states of the Gulf Cooperation Council (GCC), Saudi Arabia has large number of unemployed citizens, which creates a state of resentment among those citizens.
• As per estimates, the unemployment rate among Saudi nationals has reached 12%. More than 6.5 million non-Saudis are working in the private sector of the Kingdom compared to 7,00,000 Saudis.

Is this type of policy a new concept?

No. This is not a new concept. Initially in 1994, the Saudi government had started a system called ‘Saudization’ with the same purpose of reducing unemployment of its citizens. The programme required the appointment of Saudi citizens of the total workforce of all the establishments existing in the Kingdom. However, due to several reasons, the system could not be implemented. This percentage varied in accordance to the activity of the establishment. However, due to several reasons, the system did not achieve the desired objectives.

How will Nitaqat work?

• ‘Nitaqat’ which means ‘Ranges’, divides the Saudi labor market into 41 activities and each activity into 5 sizes (Giant, Large, Medium, Small and Very Small) to have in total 205 categories.

It classifies establishments into following ranges:

• Excellent : establishments which have highest localization ratio in their workforce
• Green: establishments which have high localization ratio
• Yellow : low localization ratio
• Red : lowest localization ratio

Effects of classification on different ranges:

• Those establishments which will be in Excellent and Green ranges will have advantages and rewards while those in Yellow and Red will be on the receiving end.

Some key advantages to Excellent or Green ranges:

• Eligibility to issue work visas for the development of new business
• Ability to contract with non-Saudi workers from the establishments of the Red and the Yellow ranges in the Saudi market.
• This will result in granting the establishments that have achieved high rates of localization the opportunity to appoint non-Saudi workers with no need to issue new work visas, which helps to rationalization the recruitment and employment of additional non-Saudi labor.

Main disadvantages to Red and Yellow ranges:

They will be forced to expedite the localization of the jobs within the establishments to upgrade their range to the Green or the Excellent range to maintain the expats they have. Otherwise, the establishments located in these ranges – Red and Yellow ranges – will be denied from obtaining new or alternative visas, lose control over the non-Saudi workers in the establishment as they will have the freedom of contract with a new employer and will not be allowed to obtain new work visas to appoint new-non-Saudis workers or to set up a new subsidiary or branch.

Recent addition in Nitaqat law:

• Expatriate worker should work only under his sponsor and the worker is not meant to perform any job other than the one mentioned on his job card have raised much panic among the expatriate workers.

What are India’s concerns over this policy?

• At present over 2 million Indian nationals are working in Saudi Arabia. Implementation of this law will lead to job losses and reduced job opportunities for Indians too.

IAS CIvil services 2012 Final Results List

This below link contains the list of selected candidates.

http://www.upsc.gov.in/exams/final-results/csm/2012/final_result_csm2012.pdf

Revised National Food Security Bill cleared by the Union Cabinet 2013

The revised form of the National Food Security Bill has been cleared by the Union Cabinet. As per the revised Bill:

• 67% of nation’s population (including 75% rural and 50% urban) will be entitled for subsidized grains under the Targeted Public Distribution System (TPDS).
• 5 kg of rice, wheat or coarse cereals at Rs. 3, 2 and Re. 1 a kg a month to every beneficiary who will be identified by the States based on parameters prescribed by the Union government.
• Antyodaya Anna Yojna, which serves 2.43 crore beneficiary households with 35 kg grains a month under the TPDS, will continue.
• Maternal benefits will not be provided to a pregnant woman beyond two live births to encourage “two-child norm”.
• Subsidized prices of grains may be revised after 3 years to the level of the minimum support price paid for procurement of grains.
• Bill will be implemented in phases.
• While the existing allocation of grains to the States shall be protected, the cost of transporting grains to ration shops shall not be passed on to consumers as was proposed earlier.
• The additional burden on the food subsidy is estimated at about Rs. 23,000 crore at 2012-13 prices.
• The grain requirement is estimated at 61.23 million tonnes.

Kishenganga Project - Facts India vs Pakistan

Recently, India won the legal battle against Pakistan regarding construction of Kishenganga Hydro Electric Project in North Kashmir.

What is the issue?

Pakistan had pleaded before the Court of Arbitration at The Hague that India’s construction of Project over Kishenganga was a violation of Indus Waters Treaty (IWT) signed in 1960.

What is the Project?

India is constructing Rs. 3600 crore, 330 MW, run-of-the-river, hydro-electric project on Kishenganga River (known as Neelam in Pak) which is a tributary river to Jhelum. The power project is under construction by the National Hydro Power Corporation in Gurez valley near Bandipura in north Kashmir.

What is the opposition from Pakistan?

• The project involves diverting waters from a dam site to Bonar Madmati Nallah, another tributary of Jhelum. Pakistan sees it a breach of India’s legal obligations owed to Pakistan under the IWT, as interpreted and applied in accordance with international law, including India’s obligations under Article III (2) (let flow all the waters of the Western rivers and not permit any interference with those waters) and Article IV (6) (maintenance of natural channels).
•  Another objection is the use of modern drawdown flushing technique for the management of sedimentation on the dam. It requires waters to be brought below the Dead Storage Level.  Pakistan had objected to the drawdown flushing apprehending that it will affect flows at its downstream Neelam project.

 What was the award by the Court of Arbitration?

• The Court of Arbitration has allowed India to go ahead with the construction of the project in rejecting Pakistan’s plea that this was a violation of the 1960 Indus Waters Treaty.
• However, the court restrained India from adopting the draw down flushing technique for clearing sedimentation. India may have to adopt a different technique for flushing.

Is it for the first time Pakistan dragged India to international court on a river issue?

No. This was the second water dispute on which Pakistan dragged India to an international arena charging New Delhi with violation of the IWT. Earlier a neutral expert was appointed by the World Bank to adjudicate on the Baglihar dam built on Chenab River also located in Jammu and Kashmir.

Open Sky Policy with ASEAN Countries

India, at present, has no Open Sky Policy with the ASEAN countries. However, there is a proposal for entering into Multilateral Agreement on Air Services with the Government of the Member States of ASEAN countries. The provisions of such Multilateral Agreement are to be based on principles of sovereignty of nations, nationality of carriers and reciprocity in terms of commercial opportunities for the airlines of the participating Member States, taking into account views of stakeholders.

What is Open Sky Policy?

• Open skies is an international policy concept that envisages for the liberalization of the rules and regulations of the international aviation industry—especially commercial aviation—in order to create a free-market environment for the airline industry.

Key objectives of Open Sky Policy:

•  To liberalize the rules for international aviation markets and minimize government intervention as it applies to passenger, all-cargo, and combination air transportation as well as scheduled and charter services; and
• To adjust the regime under which military and other state-based flights may be permitted.

For open skies to become effective, a bilateral (and sometimes multilateral) Air Transport Agreement must be signed b/w two or more countries.

Anil Ananthaswamy wins British Physics journalism prize

Anil Ananthaswamy, a London-based Indian-origin writer has won the inaugural Physics Journalism Prize. Anil Ananthaswamy, a consultant at New Scientist Magazine and author of ‘The Edge of Physics’.

Anil’s article ‘Hip Hip Array’, that “brings to life” on the Square Kilometre Array, an international project to design and build the largest radio telescope ever conceived, made him the winner.

British Physics journalism prize

• The prize sponsored by the Institute of Physics (IOP) and the Science and Technology Facilities Council (STFC).
• Objective:  To inspire the next generation of physicists by encouraging journalists to spread awareness about the complex subject.
• Offers an expenses paid trip to Japan to visit world-leading facilities carrying out research at the frontiers of physics.