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Indian Army failed to contain us, says ULFA
K Anurag in Guwahati on 06/02/2008 at 5:38pm (UTC) | | | June 02, 2008 18:25 IST
Last Updated: June 02, 2008 18:32 IST
Even as the Indian Army wants the imposition of tougher laws in support of the counter-insurgency operations against the banned United Liberation Front of Asom, the insurgent group has termed the move, 'a reflection of the failure of the Army' in demoralising and neutralising ULFA members despite its prolonged operations in Assam.
The ULFA in the latest issue of its mouthpiece Freedom, a soft copy of which has been circulated among the media in Guwahati, said, 'The demand of the General-Officer Commanding of the 4 Corps of the Indian Army for stringent laws to facilitate longer jail terms for apprehended ULFA members, has only exposed the utter failure of the Indian forces to contain ULFA's struggle for restoration of sovereignty of Assam.'
The GOC, Lieutenant General B S Jaswal during an interaction with the media at Tezpur Army base in North Assam on May 28 asked for more stringent laws that would ensure longer jail terms for arrested ULFA members so that 'recycling' of jailed members to the ranks of the ULFA could be checked in the interests of effective neutralisation of the insurgent group.
The Army officer claimed to have neutralised a total of 2030 ULFA militants during the year 2007 and 2168 ultras till May this year. This includes killing of 136 ULFA ultras in the year 2007 and 53 more till May this year. The rest of the neutralised ultras included those who have surrendered or apprehended during the period.
The ULFA further said that the 'colonial Indian forces' were getting frustrated as they have failed to create any rift in the outfit by demoralising its senior leaders who have been kept behind bars for years after years.
In view of the Army's demand for stringent laws to deal with apprehended ULFA members, the militant group made light of the Indian Army's 'often much trumpeted claim to have broken the back bone of the ULFA'. 'Why is the Government of India keeping such a huge force of its troops in Assam for counter-insurgency operation if the Army has really broken the back bone of the ULFA?' the militant group wondered.
The ULFA said the clamour for imposition of tougher laws against its members was in no way going to help find a political solution to 'the Assam-India conflict' through dialogue. The insurgent group said if the use of force could have solved the conflict, Indian Army could have already tasted grand success in its fight against the ULFA.
The proscribed militant group has blamed the 'conspiracy of Indian colonial rulers' for the present ethnic unrest and growing conflicts among different ethnic groups in Assam and other parts of the region.
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Pak: Blast near Danish embassy, 8 killed
June 02, 2008 13:14 IST on 06/02/2008 at 5:36pm (UTC) | | | At least eight people were feared killed and five others injured in a blast on Monday outside the Danish Embassy, located in a high-security area in the heart of the Pakistani capital.
Reports said the explosive device was hidden in a car parked near the Danish Embassy in the upmarket, where several embassies are located. A number of top diplomats from various countries live in the area.
The residence of Indian High Commissioner is also located in the same area but at some distance from the site of blast.
The blast caused extensive damage to the private building in which the Danish Embassy is located. About 30 cars parked in the vicinity were completely destroyed by the impact of the explosion, which caused a massive crater and even rattled the windows of houses located kilometres away.
Initial reports said most of the dead were Pakistani nationals, including guards deployed at the embassy and nearby private residences. Several Western embassies located in the area were evacuated and security was tightened across Islamabad.
No group claimed responsibility for the blast but security officials said the attack could be linked to the blasphemous cartoons of the Prophet Mohammed published in Danish newspapers.
Reports had suggested that the Danish Embassy had been issued several warnings about security threats. A committee of the Senate or upper house of parliament had recently recommended that all embassies should be shifted to the high-security Diplomatic Enclave near the Foreign Office.
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Govt can't fully protect consumers from oil price hike: PM
June 02, 2008 12:31 IST on 06/02/2008 at 5:34pm (UTC) | | |
With political parties, including the Left, opposing hike in fuel prices, Prime Minister Manmohan Singh on Monday warned that the government is not in a position to fully insulate the consumer from the impact of rising oil prices.
"We cannot allow the subsidy bill to rise any further. Nor do we have the margin to fully insulate the consumer from the impact of world commodity and oil price inflation," the prime minister said, addressing the Assocham's annual meeting in New Delhi.
Calling for a wider political consensus, Singh said the government could insulate poor people 'up to a point' and economic pricing of oil was essential to sustain growth.
However, he expressed confidence that the Indian economy would continue to grow at 8 per cent and above despite global slowdown.
India has maintained the economic growth of 9 per cent and above for the last three years.
While the government would remain focused on reversing the upsurge in inflation, the prime minister said, "We have to learn to husband our fiscal resources prudently."
Seeking industry support for taming the price rise, Singh said, "I do not wish to see a return to era of blind controls. . . At the same time, we have to have the fiscal means to protect the poor from adverse impact of inflation."
Despite the crude oil prices ruling in the range of $127 a barrel and causing huge losses to the state-owned oil marketing firms, the government has not been able to pass on the burden due to lack of political consensus.
There are differences within the government also as to how to resolve the crisis. The finance ministry and the Left parties are opposed to duty cuts sought by the petroleum ministry.
The prime minister pointed out that the government had not raised kerosene prices for the past four years, while diesel and LPG prices were only marginally revised, and petrol prices remained lower than world prices. In the case of other natural resources, especially water, the country has altogether been imprudent.
"The situation cannot continue forever. We need wider political consensus to adopt more rational economic policies," he said.
The prime minister also expressed concern about the impact of rising oil, commodity prices and protectionist policies of developed economies on liberalisation.
He said many developing countries have been forced to impose control on commodity exports and increase subsidy on imports due to big rise in food prices.
"We need a global compact so that rising food prices do not threaten the process of global integration."
The unrelenting rise in crude oil prices threatens to disrupt the development process in oil importing developing countries, he said.
Referring to the middle-path of economic reforms adopted by the country, he said the Indian route to globalisation has been more stable and avoided many pitfalls that other developing countries got into.
It bears a testimony to the wisdom of 'the slow and steady wins the race.' "The Indian tortoise will win the race against many Asian hares," he noted.
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The real reason why oil prices are rising
M R Venkatesh on 06/02/2008 at 5:33pm (UTC) | | | By now it is becoming too obvious that the United States is playing the oil game all over again. And this is the desperate gamble of a country whose economy is neck deep in trouble.
Given this scenario, managing prices of oil is central to the US economic architecture. Expectedly, this gamble has been played in a great alliance between the US government, US financial sector and the media.
I have earlier written about:
The impending collapse of the US dollar on account of the inherent weakness in the US economy caused by its structural weakness as reflected in the sub-prime crisis;
The repeated softening of the interest rates in the US that has the potency to kill the US dollar; and
How the fall in the US dollar suits the US corporate sector, especially its omnipotent financial sector.
Naturally, since the past few years, the US financial sector has begun to turn its attention from currency and stock markets to commodity markets. According to The Economist, about $260 billion has been invested into the commodity market -- up nearly 20 times from what it was in 2003.
Coinciding with a weak dollar and this speculative interest of the US financial sector, prices of commodities have soared globally.
And most of these investments are bets placed by hedge and pension funds, always on the lookout for risky but high-yielding investments. What is indeed interesting to note here is that unlike margin requirements for stocks which are as high as 50 per cent in many markets, the margin requirements for commodities is a mere 5-7 per cent.
This implies that with an outlay of a mere $260 billion these speculators would be able to take positions of approximately $5 trillion -- yes, $5 trillion! -- in the futures markets. It is estimated that half of these are bets placed on oil.
Oil price hike: Govt can't save you: PM
Readers may note that oil is internationally traded in New York and London and denominated in US dollar only. Naturally, it has been opined by experts that since the advent of oil futures, oil prices are no longer controlled by OPEC (Organization of Petroleum Exporting Countries). Rather, it is now done by Wall Street.
This tectonic shift in the determination of international oil prices from the hands of producers to the hands of speculators is crucial to understanding the oil price rise.
Today's oil prices are believed to be determined by the four Anglo-American financial companies-turned-oil traders, viz., Goldman Sachs, Citigroup, J P Morgan Chase, and Morgan Stanley. It is only they who have any idea about who is entering into oil futures or derivative contracts. It is also they who are placing bets on oil prices and in the process ensuring that the prices of oil futures go up by the day.
But how does the increase in the price of this oil in the futures market determine the prices of oil in the spot markets? Crucially, does speculation in oil influence and determine the prices of oil in the spot markets?
Answering these questions as to whether speculation has supercharged the demand for oil The Economist, in its recent issue, states: 'But that is plain wrong. Such speculators do not own real oil. Every barrel they buy in the futures markets they sell back again before the contract ends. That may raise the price of 'paper barrels,' but not of the black stuff refiners turn into petrol. It is true that high futures prices could lead someone to hoard oil today in the hope of a higher price tomorrow. But inventories are not especially full just now and there are few signs of hoarding.'
On both counts -- that speculation in oil is not pushing up oil prices, as well as on the issue of the build-up of inventories -- the venerable Economist is wrong.
The finding of US Senate Committee in 2006
In June 2006, when the oil price in the futures markets was about $60 a barrel, a Senate Committee in the US probed the role of market speculation in oil and gas prices. The report points out that large purchase of crude oil futures contracts by speculators has, in effect, created additional demand for oil and in the process driven up the future prices of oil.
The report further stated that it was 'difficult to quantify the effect of speculation on prices,' but concluded that 'there is substantial evidence that the large amount of speculation in the current market has significantly increased prices.'
The report further estimated that speculative purchases of oil futures had added as much as $20-25 per barrel to the then prevailing price of $60 per barrel. In today's prices of approximately $130 per barrel, this means that approximately $100 per barrel could be attributed to speculation!
But the report found a serious loophole in the US regulation of oil derivatives trading, which according to experts could allow even a 'herd of elephants to walk to through it.' The report pointed out that US energy futures were traded on regulated exchanges within the US and subjected to extensive oversight by the Commodities Future Trading Commission (CFTC) -- the US regulator for commodity futures market.
In recent years, the report however pointed out to the tremendous growth in the trading of contracts which were traded on unregulated OTC (over-the-counter) electronic markets. Interestingly, the report pointed out that the trading of energy commodities by large firms on OTC electronic exchanges was exempted from CFTC oversight by a provision inserted at the behest of Enron into the Commodity Futures Modernization Act in 2000.
The report concludes that consequential impact on account of lack of market oversight has been 'substantial.'
NYMEX (New York Mercantile Exchange) traders are required to keep records of all trades and report large trades to the CFTC enabling it to gauge the extent of speculation in the markets and to detect, prevent, and prosecute price manipulation. In contrast, however, traders on unregulated OTC electronic exchanges are not required to keep records or file any information with the CFTC as these trades are exempt from its oversight.
Consequently, as there is no monitoring of such trading by the oversight body, the committee believes that it allows speculators to indulge in price manipulation.
Finally, the report concludes that to a certain extent, whether or not any level of speculation is 'excessive' lies entirely in the eye of the beholder. In the absence of data, however, it is impossible to begin the analysis or engage in an informed debate over whether our energy markets are functioning properly or are in the midst of a speculative bubble.
That was two years back. And much water has flown in the Mississippi since then.
The link to the spot markets
Now to answer the second leg of the question: how speculators are able to translate the future prices into spot prices.
The answer to this question is fairly simple. After all, oil price is highly inelastic -- i.e. even a substantial increase in price does not alter the consumption pattern. No wonder, a mere 3-4 per cent annual global growth has translated into more than a 40 per cent annual increase in prices for the past three or four years.
But there is more to it. One may note that the world supply and demand is evenly matched at about 85 million barrels every day. Only if supplies exceed demand by a substantial margin can any downward pressure on oil prices be created. In contrast, if someone with deep pockets picks up even a small quantity of oil, it dramatically alters the delicate global demand-supply gap, creating enormous upward pressure on prices.
What is interesting to note is that the US strategic oil reserves were at approximately 350 million barrels for a decade till 2006. However, for the past year and a half these reserves have doubled to more than 700 million barrels. Naturally, this build-up of strategic oil reserves by the US (of 350 million barrels) is adding enormous pressure on the oil demand and consequently its prices.
Do the oil speculators know of this reserves build-up by the US and are indulging in rampant speculation? Are they acting in tandem with the US government? Worse still, are they bordering on recklessness knowing fully well that if the oil prices fall the US government will be forced to a 'Bears Stearns' on them and bail them out? One is not sure.
But who foots bill at such high prices? At an average price of even $100 per barrel, the entire cost for the purchase of this additional 350 million barrels by the US works out to a mere $35 billion. Needless to emphasise, this can be funded by the US by allowing it currency printing presses to work overtime. After all, it has a currency that is acceptable globally and people worldwide are willing to exchange it for precious oil.
No wonder Goldman Sachs predicts that oil will touch $200 to a barrel shortly, knowing fully well that the US government will back its prediction.
And, in the past three years alone the world has paid an estimated additional $3 trillion for its oil purchases. Oil speculators (and not oil producers) are the biggest beneficiaries of this price increase.
In the process, the US has been able to keep the value of the US dollar afloat -- perhaps at an extra cost of a mere $35 billion to its exchequer!
The global crude oil price rise is complex, sinister and beyond innocent economic theories of demand and supply. It is speculation, geopolitics and much more. Obviously, there is a symbiotic link between the US, the US dollar and the oil prices. And unless this truth is understood and the link broken, oil prices cannot be controlled.
Other articles by the author:
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We played entertaining cricket: Warne
June 02, 2008 10:04 IST on 06/02/2008 at 5:31pm (UTC) | | | Although disappointed to finish second best in the inaugural Indian Premier League ,Chennai Super Kings skipper Mahendra Singh Dhoni refused to blame the defeat on anyone.
Rajasthan beat Chennai by three wickets in a last-ball thriller to win the inaugural IPL.
- Score | Images
"I don't want to pinpoint any particular player. I agree that we made a few mistakes in the field but the main problem was that we had just five bowlers and even if any one of them had a bad day, we had to persist with him," a dejected Dhoni said in the post-match press conference.
In fact, lack of option forced Dhoni to toss the ball to L Balaji in the last over, even though the pacer had already been taken to the cleaners by the Rajasthan batsmen.
Only eight runs were needed from that over and though Balaji tried his best, Rajasthan batsmen Sohail Tanvir and Shane Warne overwhelmed the target in the final delivery.
- IPL: Who did well, and who didn't
Though Dhoni refused to blame anyone for the defeat, Suresh Raina dropping Yusuf Pathan, while the batsman was on 13, probably cost them the match.
Pathan, the eventual Man of the Match, mishit Muttiah Muralitharan to offer a skier which Raina grassed and the all-rounder went on to hit 56 off just 39 balls to snatch the match.
Pathan was also lucky to get another life when, batting on 33, he offered a difficult caught-and-bowled chance to MS Goni who dropped the catch.
On the decision to send Chamara Kapugedera ahead of S Badrinath, Dhoni said, "The decision was taken by the coach, because I was batting at that time. But I don't think there was anything wrong. He's a capable cricket and it only did not click today."
He also praised Pathan for his superb batting and said, "He is such a player that if he sticks around for a while, he would definitely score runs at fast rate. We had a plan but it does not work at times. Besides, playing two games in as many days was tough, but we knew this will happen."
Warne, meanwhile, hailed his bowlers for the IPL triumph.
"Our main strength was that we always went in with at least five front line bowlers in every game. It's our bowlers who won us the tournament. We always had enough options in our bowling.
"In batting, Swapnil (Asnodkar), (Shane) Watson and Yusuf (Pathan) have been just outstanding," he said.
Warne, however, refused to equate the triumph with some other notable victories in his illustrious international career.
"I won't place this victory in the same league as World Cup triumph or Ashes win or beating India in India. But this is definitely a very satisfying win.
"We were the underdogs right from the start but we have played an entertaining brand of cricket," he said.
Asked how long he expected himself to hang around, Warne said, "I'll be back as long as my body holds up and I'm wanted by the franchisee boss."
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Rajasthan win inaugural IPL
Last Updated: June 02, 2008 00:35 IST on 06/02/2008 at 5:29pm (UTC) | | | Rajasthan Royals beat Chennai Super Kings by three wickets (and off the last ball) in the final of the inaugural Indian Premier League at the D Y Patil Stadium in Mumbai on Sunday.
Scorecard
Chasing a target of 164, Rajasthan began on a disastrous note, losing three wickets inside seven overs with just 42 runs on the board.
Niraj Patel (2) was cleaned up by Manpreet Gony in the fourth over and Swapnil Asnodkar (29) and Kamran Akmal (6) were dismissed in the space of three balls (of an Albie Morkel over), the latter needlessly run-out.
However, the in-form duo of Shane Watson (28) and Yusuf Pathan (56) put on 65 runs in just 45 balls for the fourth wicket in a partnership that brought Rajasthan back in the game.
Watson was impressive in his 19-ball knock, which had three hits to the fence, before he was cleaned up by a beautiful delivery from Muralitharan.
The Sri Lankan also snapped up Mohammad Kaif (12) off his final delivery (the last ball of the 17th over) and Morkel dismissed Ravindra Jadeja (0) with the very next delivery to brighten Chennai's prospects.
Rajasthan were precariously placed at 139 for six, needing 25 runs with 17 balls left.
Then the worse happened. Pathan, who surived three chances to post his fourth half century of the tournament, saw his luck run out finally.
Pathan, whose 39-ball knock contained three hits to the fence and four huge ones over it, was run-out to a direct hit by Suresh Raina.
But Rajasthan captain Shane Warne was not to be denied his moment of glory.
Rajasthan needed 18 runs off the last two overs and eight from the final over, bowled by Lakshmipathy Balaji.
Warne (9 not out) and Sohail Tanvir (12 not out) took their team home, the latter hitting a boundary off the last ball.
Earlier, Rajasthan Royals used their bowling resources intelligently to restrict Chennai Super Kings to a modest 163 for five wickets.
Royals skipper Warne won the toss, asked the rival team to bat first and then captained the side imaginatively with his field placings and bowling changes, never allowing the Super Kings to settle down on a slow-pace track.
The Super Kings owed their score mainly to an enterprising 43 by in-form one-down batsman Suresh Raina, who faced only 30 balls while hitting two pulled sixes and a four.
The UP left-hander, back in the Indian one-day team, built on a decent start of 39 in 5.2 overs provided by Parthiv Patel (38 in 33 balls) and Vidyut Sivaramakrishnan (16 in 14 balls).
But his dismissal in the 17th over, when he threatened to cut loose, derailed Chennai's plans for a more healthy total.
The most impressive bowler for the Royals was off-spinner Pathan, who grabbed three for 22 in two spells, while Watson accounted for the wicket of Raina.
The Super Kings, who had lost their two home and away ties earlier in the tournament against the same opposition, began their innings on a cautious note on a slow-paced track of low bounce on which the ball did not come on freely to the bat.
Parthiv and Sivaramakrishnan played it safe against Tanvir, who had grabbed six for 14 against them on May 4 at Jaipur.
Seeing the mood of the two openers, Warne removed the Pakistani left-arm pacer, the most successful bowler in the tournament, after only one over.
The run-rate perked up when Vidyut played an inside-out cover drive off Watson and then was lucky when his top-edge flew over the third man fence for a six.
Parthiv, coming into the match on the back of an unbeaten 51 last night in the semifinal against Punjab King's XI, was content to see off Tanvir by facing five dot balls and then hitting his first four. He was also lucky to see his top edge off Munaf Patel race to the fence.
Warne replaced Watson with Pathan after five overs, in which 39 runs were scored, and the move paid off immediately when Vidyut pulled a short ball for Jadeja to bring off a fine front-diving catch at mid-on.
Warne rung in quick bowling changes to unsettle the second wicket duo of Parthiv and fellow left-hander Raina, who had powered their team to a nine-wicket win over Punjab King's XI with an unbeaten century stand.
The 50 of the innings was raised in the seventh over and then Parthiv, after pulling off spinner Pathan for his fifth four, departed. He edged an attempted off-glide to wicket keeper Akmal who juggled with the ball before completing the catch.
In-form Raina, who made 54 not out against Deccan Chargers in his team's last preliminary phase tie and followed it up with 55 not out against Punjab, continued his good run by stroking the ball well. He was hardly troubled by the spinners and pulled the great Warne for a six.
Morkel (16) also pulled Warne disdainfully for a six into the stands in the 12th over after the first 10 had yielded 75 runs. The South African all-rounder also swung Pathan over mid-wicket for his second six before he got out in the same over, 13th of the innings.
In trying to repeat the shot he ballooned a catch to stumper Akmal who took a tumble over Mohd Kaif, who also went for the ball, while managing to hold on to the sphere to provide Pathan his third wicket.
The 100 came up in 80 balls after which Raina swung Siddharth Trivedi, bowling his second spell, for a six. Later skipper Mahendra Singh Dhoni (29 not out in 17 balls) lofted Warne, bowling his last over, over the straight field for another six to take Chennai Super Kings to 117 for three with five overs remaining.
Raina fell in trying to clear the long off area and was caught just inside the rope by Jadeja after which Dhoni and Chamara Kapugedara added 20 runs before the latter holed out to the deep off Tanvir in the last over.
Dhoni, who hit a straight second six in Tanvir's last over, and S Badrinath (6) remained unbeaten at the end of the innings.
Rajasthan were without opener Graeme Smith and made two changes to the side which won the semifinal against Delhi Daredevils while Chennai retained the side that won them the semi final against Punjab King's XI.
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