True-False Exercise May 31

Read the passage carefully and without referring to the passage classify the following statements as TRUE or FALSE. (Answers provided at the Answers page)

India has just a 50% chance of becoming a breakout nation (exceeding expectations of 7% GDP growth) in coming years. So says Morgan Stanley honcho Ruchir Sharma in a fascinating new book, Breakout Nations. 

There is no better book for country-by-country accounts of emerging markets (and riskier ones called frontier markets). Its strong point is the author's reliance on grassroots experience in each country, avoiding statistical charts. 

His surprise prediction: the top breakout prospects include two Muslim democracies, Turkey and Indonesia. Tops in Europe are Poland and the Czech Republic. Asia's potential breakouts include Sri Lanka and the Philippines. Nigeria and East African nations may qualify too. 

India's big advantage, says Sharma, is its low income base and big catch-up possibilities. He correctly sees huge potential in the sharply accelerating backward states of north and central India. These can grow fast for decades with little effort through catch-up with advanced states. They are being transformed by dynamic chief ministers, even as New Delhi dithers and wallows in corruption, premature welfarism and policy paralysis. 

The book is a bit too pessimistic about India, which probably has more than a 50% chance of exceeding 7% growth. Sharma dismisses the demographic dividend, arising from a growing workforce, as a mere fad. But research shows that demographic dividends accelerated growth in every Asian tiger from Korea to China. India is no exception. 

India's workforce needs better skills to maximize its demographic advantage. Progress here has been deplorable. Yet learning-by-doing and innovation are unambiguously taking India up the skill ladder. Total factor productivity keeps rising. 

India hasn't actually reaped any demographic dividend so far, the latest surveys show, because female participation in the workforce has fallen sharply. As poor families become middle class, they withdraw women from the workforce, a sign of status. But as incomes keep rising and girls complete college, they re-enter the workforce. That's a huge coming demographic advantage. 

Sharma identifies South Korea as the gold medalist of growth, transforming itself from a cheap-labour economy to one at the cutting edge of R&D. Yet he ignores India's technological achievements at a very low income level. By refusing to liberalize labour laws, India has failed in labour-intensive industries, yet has succeeded dramatically in brain-intensive areas from software and high-end outsourcing to pharmaceuticals and automobiles. Many multinationals are building R&D centres to harness Indian brainpower . India has a hundred flaws, but punches way beyond its weight in technology. 

Sharma worries about premature welfarism and subsidies. Subsidies on oil and fertilizers are outrageously high. But NREGA costs just 0.33% of GDP and is affordable. Sharma complains that India's consolidated fiscal is up from 6% to 9% in five years. But it has been 8-9 % for most of the last three decades, yet India's growth has actually accelerated . He worries that the debt/GDP ratio is very high at 70%, but doesn't notice that the ratio has actually fallen from 85% to 70% in the last decade. This is mainly due to inflation, which erodes old debts. 

There's not enough creative destruction, he says: entry and exit of companies in the sensex is much less than in the Dow in the US. Surely the right comparison would have been with other Asian bourses. India has produced new giants galore for two decades-in software, infrastructure , pharmaceuticals and even windmills- unlike any developing country, save China. 

Corruption and crony capitalism are major problems. Yet, India's ranking has actually improved in Transparency International's corruption index. Corruption is worst in natural resources , real estate and governments contracts. 

Many cronies are incompetent crooks. But others once called cronies-like the Ambanis -later developed into world-class players. GMR, the crony of Delhi Airport, is now a successful global player, building airports in Turkey and Maldives. Cynics say success in managing Indian politicians makes you a world class manager. If so, cronyism is partly a desi Harvard Business School, teaching jugaad through learning-by-doing . 

The biggest problem in India is multiple hurdles for small businesses despite supposed liberalization . Sharma denounces Russia for being 120th of 183 countries in ease of doing business according to the IFC/World Bank Doing Business report. But India is 132nd. Worse, India comes 166th in ease of starting a business, 181st in getting building permits, and 182nd (second last) in enforcement of contract. 

Sharma's worries about India pale beside his merciless dissection of China, Brazil, Russia and South Africa. He predicts, persuasively and wittily , that these four will disappoint in coming years. His compelling chapters on these countries are the best reason for reading this book. They raise a major question: should India stop paying attention to the BRICS group, a sinking ship?

Classify these statements as true or false. (Without going back to the passage)

1) The passage has been written by Ruchir Sharma

2) The passage is a review of a book written by Ruchir Shrama.

3) The name of the book is Breaking Nations.

4) The author feels India has not been able to leverage its demographic advantage.

5) The author totally agrees with Ruchir Sharma’s take on Indian economy.

6) Sharma’s criticism of India is more severe than of China.

7) The Author compares crony capitalism of India with a leading B school of the world.

8) India’s biggest strength is that it has reduced the hurdles in the way of small businesses.

9) India’s debt / GDP ratio has been reported to be 85%.

True and False Exercise May 30

Read the passage carefully and without referring to the passage classify the following statements as TRUE or FALSE. (Answers provided at the Answers page)

It is said that only God and a few good men and women run India. One such man is P H Kurien.

For readers unfamiliar with his name, Kurien was India's Controller General of Patents, Designs & Trade Marks until March 12, 2012. On March 9, 2012, just three days before he left office, he issued the first-ever compulsory licence in India for the manufacture of a drug still under patent. The licence authorized Indian company Natco to manufacture drug Naxevar for which Bayer, a German multinational company, holds the patent. This was an act of major significance for India's health.

Since March 3, 2008, when it got the Indian patent, Bayer has imported Naxevar, selling its monthly dose at the whopping price of 2,80,428 or $5,420. Unsurprisingly, only 2% of Indian patients have been able to afford it.

In its application for compulsory licence to the Controller General of Patents, Natco offered to sell the monthly dose at 8,800 ($170), a mere 3% of Bayer's price. Kurien obliged the numerous patients suffering from liver and kidney cancer, by ruling in favour of Natco.

To explain why this was a heroic act, we must look at the history of drug patents in India beginning four decades ago. At the time, in what was one of her few wise economic-policy decisions, Prime Minister Indira Gandhi replaced the then existing patent law, inherited from the British, by the Patent Act of 1970. The new Act entirely eschewed product patent, limiting patents in medicines to process. Henceforth, any company able to produce a drug via a process different from those patented by existing manufacturers could sell the drug in the Indian market.

Altering the process of production by reverse engineering in pharmaceuticals is a low-cost affair. The Patent Act of 1970 allowed Indian companies to manufacture and sell drugs at a fraction of the price charged by original patent holders, overwhelmingly foreign multinationals. That, in turn, spawned a substantial, low-cost pharmaceutical industry in India.

In 1959, a United States Senate Sub-committee headed by Senator Estes Kefauver had noted that when it came to drugs, India ranked 'amongst the highest-priced nations of the world.' Thanks to the Patent Act of 1970, drug prices rapidly tumbled, turning India into possibly the lowest priced country.

As early as the 1970s, American pharmaceutical companies had realised that as leaders in drug innovation, they stood to profit if they could get other countries to adopt the same high standards of patent protection as the United States. By the early 1980s, most developed countries had patent protection approaching those in the US. But since the developing countries continued to maintain low protection, American pharmaceutical companies began to lobby the US government to pressure them into implementing higher standards.

The Uruguay Round (UR) of trade negotiations provided the companies their big opportunity. They not only managed to place all intellectual property rights on the negotiating agenda but eventually succeeded in pushing the wide-ranging Agreement on Trade related Aspects of Intellectual Property Rights (TRIPs) as a part of the UR Agreements establishing the World Trade Organization (WTO). The TRIPs agreement required all WTO members to provide 20-year product and process patents on new medicines.

Its vilification as an obstructionist negotiator by the western press and governments notwithstanding, India fought hard against product patents on medicines. Though it lost that battle, it did score an important victory. It got inserted in the Agreement on TRIPs, a provision whereby member countries would retain the right to issue compulsory licence to domestic firms for a patented medicine if the patent holder did not provide the medicine at an affordable price.

In 2005, when India amended the Patent Act of 1970 to become TRIPs-compliant, it built this provision into the amended Act.

Natco applied to the Controller General of Patents for compulsory licence under this provision. This was the first such application, so Kurien was on unchartered territory. Luckily, earlier he had spent three years as a scholar at the Indian Institute of Science and appreciated the value of research. In addition to inviting Natco and Bayer to present arguments and evidence at a hearing that lasted 18 hours, spread over three days, he sifted through reams of articles by scholars and institutions globally.

Based on this investigation, Kurien produced a 62-page airtight judgment in favour of Natco. Bayer has appealed but it will take a miracle to overturn the judgment. Sensing the threat to future profits of its companies, the US has turned to pre-WTO pressure tactics, placing India on its latest "Priority Watch List." But India's commerce minister Anand Sharma has reacted coolly describing the US action as "unilateral, unfortunate and unjustified."

In its defence, Bayer had argued that its high price of the drug was necessary to defray the cost of invention. This is a spurious argument. If drug companies counted on poor countries to recover the costs of their inventions, they would invest in research to treat tropical diseases such as tuberculosis and malaria. They do not.

Kurien has sent a clear signal that the provisions of compulsory licence in Indian patent law have teeth and that a patent holder selling medicine at unduly high prices faces real prospect of entry of low-cost competitors. And, for that, he is a hero.

Classify these statements as true or false. (Without going back to the passage)

1) Naxevar is a drug used to cure tuberculosis.

2) Natco offered to sell the monthly dose at a price 97% less than the price charged by Bayer.

3) Natco has defended the high price saying that it was needed to cover the cost of initial research.

4) India was always in favor of product patent on medicines.

5) Product patent has been a boon for the patients in India.

6) Kurien has allowed Natco to sell Naxevar as an impulsive decision.

7) The Patent Act of 1970 rejected product patent in favor of process patent.

8) Anand Sharma has not succumbed to the pressure tactics of the US in support of Bayer.

True and False exercise May 29

Read the passage carefully and without referring to the passage classify the following statements as TRUE or FALSE. (Answers provided at the Answers page)

KARL ROVE, President George W. Bush's Deputy Chief of Staff, said in an interview in 2004: “We're an empire now, and when we act, we create our own reality. And while you're studying that reality – judiciously, as you will – we'll act again, creating other new realities, which you can study too, and that's how things will sort out. We're history's actors… and you, all of you, will be left to just study what we do.”

Aptly, this forms the epigraph of Noam Chomsky's book Making the Future: Occupations, Interventions, Empire and Resistance, especially because Chomsky aims to dismantle such a posture of extreme confidence and arrogance, of inequality, disenfranchisement and deceit. The functionalist logic of late imperial culture provides a basis to the current debate on this far-reaching issue and focuses on the theoretical, ideological and political assumptions that underpin it. The varied areas of media, theatre, film, photography, emphasize the reproduction of the empire's dominant self-images with the sole purpose of exploiting and oppressing weaker cultures, which continue to pay a huge price.

The hegemonic tenor of Pax Americana is audible in Rove's words ensuring that American authorship remains paramount behind histories of those nations that have experienced American interventions. The words are couched in the language of politics that is exclusionary to the extent that it assaults national sovereignty around the world through vast expansion of its powerful frame of reference and regurgitating abject disinformation. The United States' military and cultural dominance shows how imperial rule involves the control over the internal and external policy of the ‘other', the subordinate periphery. Military dominance sustains a massive capacity to influence the global economy that neither a more efficient Japan nor a united Europe can entirely overcome. To fully grasp this interaction, it is important to come to grips with the vast differences between the inadequacy of the subject and the power of the state. The culture of imperialism is not an event of the past, and much still remains in the legacy of colonial history, culturally, economically and politically.

Chomsky takes upon himself the task of unmasking American foreign policy in the context of the timing of Rove's statement, which is around 2002 when the U.S. was divided into two camps. One of them favoured intervention in Iraq which it said would finally usher in a transformation to a democratic form of government that would spread all over West Asia. Along with this, the motive of gaining from the rich oil reserves also underpinned the argument of adopting an aggressive policy against Saddam Hussein.

The other camp, which included the Pentagon and the Central Intelligence Agency (CIA), argued against the war as they were sceptical of any success. The discourse underpinned by the theory that weapons of mass destruction in the hands of Saddam Hussein would culminate in an Armageddon finally lent legitimacy to George Bush entering one of the most disastrous and expensive wars the U.S. has ever fought.

It goes to the credit of Chomsky for standing up against American intervention in Iraq, not merely because it would be costly or achieve no positive results, but because, as he argues, it is in the nature of American foreign policy to be inherently ‘evil and criminal', a feature that defines its imperial ideology. Chomsky writes: “The criticism of the Iraq war is on grounds of cost and failure; what are called ‘pragmatic reasons', a stance that is considered hard-headed, serious, moderate – in the case of Western crimes.”

It is clear that the prevalence of a war-like situation in West Asia is owing to the joint designs of Israel and the U.S. which are not ready to change their policy towards Palestine that can facilitate a solution. Nor has the U.S. played a conciliatory role between India and China or achieved much geopolitically in bringing about a more peaceful Afghanistan. As Chomsky argues: “It is an article of faith, almost a part of the national creed, that the United States is righteously unlike other great powers, past and present.”

Can we agree with Chomsky that nothing seems to have changed? The 500 years of history since Columbus has been one of subversion, aggression and brutal genocide that was inherent even during the Cold War. With the demise of the Cold War, things stand where they are though now the West is given a free reign in its imperial designs unlike the pre-Gorbachev era. The Third World escaped any interference from the West for many decades until the expiry of the Soviet Union brought about a unilateral world in which America meddles with international politics with its nefarious actions.

The Soviet Union ruled over Eastern Europe, but probably less viciously than the way the U.S. exercised its hegemony over Latin America. For example, it is a revelation to see the American hand in involving erstwhile Nazi generals in the whole exercise of terror and domination in Latin America.

And the world goes on in a state of “repressive tolerance”, a Marcusian conception that is applied globally. Chomsky is enraged by this remorseless transnational hegemony. His idea of power as violence is deep down an intellectual stance of articulating an appraisal of the existing world order where persecution and carnage have been integral and more so recently in the wars in Afghanistan and Iraq.

As generalisations and theory are not sufficient for an understanding of the evolution of imperialism, its impact at various levels of specificity has to be taken up and a painstaking attempt made to create in detail the values, the attitudes and the atmosphere of colonised societies. As societies are juxtaposed and then intermingled, it creates significant and unexpected perspectives, which are the sign of the new problems and complexities of authority and power. Chomsky sets out to deflate the celebratory tone of American self-importance by analysing and resisting the continuing imperial attitude of America with his counter-narratives to the official histories in his essays on the world financial crisis, global warming, the wars in West Asia, about the rise of China, threat of nuclear proliferation in Iran and North Korea and the shift towards Left politics in Latin America. He has a significant story to tell, a revisionist narrative running through the collection of essays that throw light on decades of lies behind the American foreign policy and thereby facilitating the process of retrieving histories of those who unfortunately suffer a marginalised status. Provocative and firmly written, the 50 commentaries that compose Making the Future appeared in The New York Times Syndicate over the last few years. They bring out the state of U.S. politics between 2007 and 2011, a comprehensive and an objective perspective that rewrites biased accounts of various national and international significance. An understanding and appreciation of these essays will help throw light on the overwhelming majority of the American opinion-makers and their perspectives, replete with forged documents and blatant lies.

Classify these statements as true or false. (Without going back to the passage)

1) “We're an empire now,…..… will be left to just study what we do.” are the words of George W Bush.

2) The passage is written by Noam Chomsky.

3) The passage is a book review.

4) Chomsky is critical of US role in the world’s geopolitics.

5) In 2002 Pentagon argued against the war on Iraq.

6) Soviet Union’s rule over Eastern Europe was more evil than the US control over Latin America

7) The US has played a positive role in resolving the crisis in West Asia.

8) A majority of US opinion makers have never relied on forged documents and blatant lies.

9) The US is morally very similar to other great powers in the past.

True-False Exercise May 26 1012

Read the passage carefully and without referring to the passage classify the following statements as true or false. (Answers provided at the Answers page)

It’s a classic case of brinkmanship bargaining: Iran and the West, each seeking to squeeze concessions from the other side, have decided to extend their nuclear negotiations to another round starting on June 17, a few weeks before a punishing new round of sanctions takes effect.

The deadlock was described at the conclusion of Thursday’s negotiating session in Baghdad by Catherine Ashton, the European Union’s chief diplomat and the West’s spokesperson: “It is clear that we both want to make progress, and that there is some common ground. However, significant differences remain.”

What’s the likelihood that this game of chicken will produce an acceptable deal? A skeptic would say that the chance is probably slim, given the level of mutual mistrust and the conviction on both sides that the best way to get an agreement is to tighten the screws. But because a military confrontation lies on the other side of diplomatic failure, both sides keep at it.

To try to imagine what a workable solution might look like, I spoke Thursday afternoon to Seyed Hossein Mousavian, a former member of the Iranian negotiating team who is now a visiting scholar at Princeton. I also read his remarkable new book, “The Iranian Nuclear Crisis: A Memoir,” which will be published next month.

Mousavian’s basic argument is that a deal is possible but only if it recognizes Iran’s rights as a signatory of the Non-Proliferation Treaty (NPT). In practice, this means that the West must drop its goal of preventing Iran from enriching uranium, which is permitted under the treaty, and instead focus on ensuring that Iran doesn’t build a nuclear weapon.

Mousavian quotes a vow Supreme Leader Ali Khamenei made in 2004: “I would resign if for any reason Iran is deprived of its rights to enrichment.”

We might wish that it were otherwise, but I think that Mousavian is correct that allowing Iran some enrichment activity is a necessary condition of a deal. Once that right is established, Mousavian thinks that Iran would agree to a “zero stockpile” of uranium enriched to the potentially dangerous 20 percent level. As an interim “confidence-building measure,” Iran would export its stockpile of 20 percent uranium beyond what it needs for domestic civilian use.

A deeper point made by Mousavian is that Iran is unlikely to agree to anything if it’s seen as doing so under duress. This contradicts the established wisdom in Washington, which is that Iran has come to the table only because sanctions are beginning to hurt.

The pressure track seems to me to have provided some leverage, but I also understand Mousavian’s point that Iran “won’t make major concessions under threats.” Successful diplomatic negotiations are always a process in which each side can claim some success, rather than one of demand and capitulation.

It’s useful to view recent negotiating history through Iranian eyes. Here’s what this optic reveals: In 2005 Khamenei removed his ban on negotiations with America; in 2009 Iran offered to export to the United States its uranium enriched to 20 percent, and it renewed this offer with greater specificity in 2010 and 2011; Iran accepted a Russian proposal last July to suspend further enrichment capacity and accept the International Atomic Energy Agency’s “additional protocol” for intrusive inspection. The Iranians think that they got nothing but more sanctions for these moves.

The more the West has tried to squeeze Iran, the more the Iranians have done precisely the things that infuriate the West. That may be because they’re determined to acquire nuclear-weapons capability, or because they resist pressure tactics. Either way, recent efforts to constrain Iran haven’t worked.

Mousavian argues that a nuclear deal is within reach, based on the twin of pillars of Iran’s rights as an NPT signatory and Khamenei’s religious edict banning nuclear weapons. But for real security, he contends, Iran and the United States must launch a parallel bilateral negotiation.

As an agenda for these breakthrough talks, Mousavian suggests two opening topics where the countries have identical interests: stabilizing Afghanistan under a non-Taliban government, and curtailing drug trafficking in the region. As evidence of Iran’s readiness, he cites an invitation made in February 2011 in Sweden for Marc Grossman, the top U.S. diplomat overseeing Afghanistan, to come to Tehran for talks. A U.S. source said that Washington proposed talks in Afghanistan instead, but Iran balked.

How much of what Mousavian says would hold up in practice? The best test is negotiations, and there the two sides have given each other another month to explore paths away from the brink.

Classify these statements as true or false. (Without going back to the passage)

1. Seyed Hossein Mousavian is a former foreign minister of Iran.
2. Iran is willing to forego its right to enrich uranium.
3. Both Iran and the West have a very soft attitude during negotiations.
4. Iran is a signatory to the NPT.
5. Iran rejected a Russian proposal last July to suspend further enrichment capacity and accept the International Atomic Energy Agency’s “additional protocol” for intrusive inspection.
6. Mousavian is optimistic about the breaking of the deadlock.

7.       Mousavian  once made a vow: “I would resign if for any reason Iran is deprived of its rights to enrichment.”

Summary Exercise May 23, 2012

Read the following article and write a summary of around 70 words and tally it with summary provided on the Answers Page.  

Rage is the dominant emotion in India today. Not the rage of the underprivileged, of the indigent, of Les Miserables who see no hope in this glittering nation - but that of the privileged and the powerful. Politician rage, film actor rage, celebrity rage, each one expressing an impatience with rules, laws, conventions. 
Road rage, a quotidian occurrence on our streets, does not come from the auto-rickshaw driver but from the SUV owner who cannot fathom why a pedestrian would want to cross at a green light. At the other end, a high-flying industrialist is angry that the government, the media and perhaps even passengers have somehow let him and his airline down. That his business model could be flawed does not occur to him and the question of apologising to shareholders and customers is farthest from his mind. 
The Indian Premier League, that fiery cocktail of big money and low sleaze has offered up many examples of such fury. Cricketers, mindful of the high expectations engendered by their high salaries, have kicked stumps, threatened rivals and wagged their fingers at umpires. The glamorous and influential franchise owners, fully aware that they have paid top dollar for the teams and therefore subject to no rules or conventions, strut about the stadium, leaving no doubt who is the boss. Why should they listen to a small-time security guard when they don't care two hoots about the mandarins who run the game? The wrath then is directed at the petty employee; there is nary an admission, let alone an apology that perhaps the matter went too far and could have been handled with dignity. 
Another celebrity, famous only for being his father's son and the escort of an actress, gets het up when the media asks him about a sexual harassment case involving one of his franchise's players. A party girl daring to blame a cricketer for making passes? Let us rubbish her on Twitter, in the most demeaning way possible. Where at one time there would have been bland assurances of "looking into the matter", now there is a direct attack on the girl's reputation and on the media for bringing it up. The girl has dared raise her voice against a cricketer and by implication the powerful people who own him, so she must be squashed. What more can be expected from someone who uses the social media to rubbish complaints made by passengers? 
Time was when politicians showed humility, even if fake and contrived, to the public, fully conscious of the optics of the folded hands. Today, a chief minister walks off in a huff when her constituents ask questions that she finds inconvenient. And then sends cops to check out the antecedents of the questioners, who are college students. Her message is unambiguous: I am powerful and, therefore, can do whatever i want to you serfs. 
Such messages, coming from those who are in public life and should be role models of civility, filter down rapidly. The signal is unambiguous: power allows you to strut and squash anyone who is beneath you. More money, better job, bigger car are all markers of influence and muscle, which must be deployed to show the lower orders their place. To these superior beings, the ordinary laws do not apply. VIPs of all hues, for example, do not believe in queues of any kind. How often do we see this sense of entitlement being played out at airports, where the great and the good breeze past security? Body checks and boring lines at immigration are not for them. 
The bizarre part is that we, as citizens of a democratic country, freely accept and even justify such feudal inequality. After Shah Rukh Khan, who finds it difficult to keep his temper in check in India, was held up for questioning at an American airport, many Indians were outraged because a celebrity was treated in this manner. It did not occur to them that for an American customs official, there are no exceptions, only the rules that must be followed. We quietly and happily submit to the Indian way of doing things, which is to have a different set of rules for VIPs; there our sense of rage deserts us. 
The rising rage is directly related to our increasing lack of civility. Sorry seems to be a word that has disappeared from our lexicon. When common courtesies, such as holding the door open for someone behind you, vanish, a society is well on the road to boorishness and eventually rage. Good manners are the bedrock of civilised social transactions; are we a good-mannered people? 
India has not handled its success well. Instead of the greater responsibility that should come with greater power and wealth, we have chosen to swagger. We take grave offence at the most innocuous of comments. We cannot stand anyone making fun of our foibles or our accent. We are ready to use our diplomatic resources if some advertisement in a far away country spoofs our ways. The world is laughing at our pompousness and this makes us more furious. 
The sorriest part of this is that our rage is turned against those who cannot defend themselves. And those at the bottom of the social pyramid, who suffer the most inequity and therefore have some justification to be angry, are expected to meekly surrender. What will happen if one day they start showing their rage? 


Source: The Times of India

Summary Exercise May 22, 2012

Read the following article and write a summary of around 100 words and tally it with summary provided on the Answers Page.  

I've spent the last week traveling to two of America’s greatest innovation hubs — Silicon Valley and Seattle — and the trip left me feeling a combination of exhilaration and dread. The excitement comes from not only seeing the stunning amount of innovation emerging from the ground up, but from seeing the new tools coming on stream that are, as Amazon.com’s founder, Jeff Bezos, put it to me, “eliminating all the gatekeepers” — making it easier and cheaper than ever to publish your own book, start your own company and chase your own dream. Never have individuals been more empowered, and we’re still just at the start of this trend.

“I see the elimination of gatekeepers everywhere,” said Bezos. Thanks to cloud computing for the masses, anyone anywhere can for a tiny hourly fee now rent the most powerful computing and storage facilities on Amazon’s “cloud” to test any algorithm or start any company or publish any book. Start-ups can even send all their inventory to Amazon, and it will do all the fulfillment and delivery — and even gift wrap your invention before shipping it to your customers.

This is leading to an explosion of new firms and voices. “Sixteen of the top 100 best sellers on Kindle today were self-published,” said Bezos. That means no agent, no publisher, no paper — just an author, who gets most of the royalties, and Amazon and the reader. It is why, Bezos adds, the job of the company leader now is changing fast: “You have to think of yourself not as a designer but as a gardener” — seeding, nurturing, inspiring, cultivating the ideas coming from below, and then making sure people execute them.

The leading companies driving this trend — Amazon, Facebook, Microsoft, Google, Apple, LinkedIn, Zynga and Twitter — are all headquartered and listed in America. Facebook, which didn’t exist nine years ago, just went public at a valuation of nearly $105 billion — two weeks after buying a company for $1 billion, Instagram, which didn’t exist 18 months ago. So why any dread?

It’s because we’re leaving an era of some 50 years’ duration in which to be a president, a governor, a mayor or a college president was, on balance, to give things away to people; and we’re entering an era — no one knows for how long — in which to be a president, a governor, a mayor or a college president will be, on balance, to take things away from people. And if we don’t make this transition in a really smart way — by saying, “Here are the things that made us great, that spawned all these dynamic companies” — and make sure that we’re preserving as much of that as we can, this trend will not spread as it should. Maybe we could grow as a country without a plan. But we dare not cut without a plan. We can really do damage. I can lose weight quickly if I cut off both arms, but it will surely reduce my job prospects.

What we must preserve is that magic combination of cutting-edge higher education, government-funded research and immigration of high-I.Q. risk-takers. They are, in combination, America’s golden goose, laying all these eggs in Seattle and Silicon Valley. China has it easy right now. It just needs to do the jobs that we have already invented, just more cheaply. America has to invent the new jobs — and that requires preserving the goose.

Microsoft still does more than 80 percent of its research work in America. But that is becoming harder and harder to sustain when deadlock on Capitol Hill prevents it from acquiring sufficient visas for the knowledge workers it needs that America’s universities are not producing enough of. The number of filled jobs at Microsoft went up this year from 40,000 to 40,500 at its campus outside Seattle, yet its list of unfilled jobs went from 4,000 to almost 5,000. Eventually, it will have no choice but to shift more research to other countries.

It is terrifying to see how budget-cutting in California is slowly reducing what was once one of the crown jewels of American education — the University of California system — to a shadow of its old self. And I fear the cutting is just beginning. As one community leader in Seattle remarked to me, governments basically do three things: “Medicate, educate and incarcerate.” And various federal and state mandates outlaw cuts in medicating and incarcerating, so much of the money is coming out of educating. Unfortunately, even to self-publish, you still need to know how to write. The same is happening to research. A new report just found that federal investment in biomedical research through the National Institutes of Health has decreased almost every year since 2003.

When we shrink investments in higher education and research, “we shoot ourselves in both feet,” remarked K.R. Sridhar, founder of Bloom Energy, the Silicon Valley fuel-cell company. “Our people become less skilled, so you are shooting yourself in one foot. And the smartest people from around the world have less reason to come here for the quality education, so you are shooting yourself in the other foot.”

The Labor Department reported two weeks ago that even with our high national unemployment rate, employers advertised 3.74 million job openings in March. That is, in part, about a skills mismatch. In an effort to overcome that, and help fill in the financing gap for higher education in Washington State, Boeing and Microsoft recently supported a plan whereby the state, which was cutting funding to state universities but also not letting them raise tuition, would allow the colleges to gradually raise rates and the two big companies would each kick in $25 million for scholarships for students wanting to study science and technology or health care to ensure that they have the workers they need.

This is not a call to ignore the hard budget choices we have to make. It’s a call to make sure that we give education, immigration and research their proper place in the discussion.

“Empowering the individual and underinvesting in the collective is our great macro danger as a society,” said the pollster Craig Charney. Indeed, it is. Investment in our collective institutions and opportunities is the only way to mitigate the staggering income inequalities that can arise from a world where Facebook employees can become billionaires overnight, while the universities that produce them are asked to slash billions overnight. As I’ve said, nations that don’t invest in the future tend not to do well there. 

Source: The New York Times

Summary Exercise May 18, 2012

Read the following article and write a summary of around 90 words and tally it with summary provided on the Answers Page. 

The conflict between the Philippines and China over the Scarborough Shoal may appear at first sight a minor dispute over an uninhabitable rock and surrounding shallow waters. But it is hugely important because it encapsulates China's assumption that the histories of the non-Han peoples whose lands border two-thirds of the waters known in English as the South China Sea are irrelevant.

The Philippine case over Scarborough has been mostly presented as one of geography. The feature is 135 nautical miles from Luzon, the main Philippine island, and roughly 350 miles from the mainland of China and 300 miles from the tip of Taiwan. It is thus also well within the Philippines' Exclusive Economic Zone.

China leapfrogs these incon- venient geographical truths to come up with justifications of its claims which can be applied to the whole South China Sea and thus justify the dotted line on map which vaguely defines them. This line has never been precisely delineated but comes well within the 200-mile limits of all the other countries, and close to Indonesia's gas-rich Natuna islands.

In the case of the Scarborough Shoal, its historical justification is that this rock and surrounding shallow water is mentioned in a Chinese map of the 13th century when China itself was under alien - Mongol - rule. The fact that a vessel from China had visited the shoal and recorded its existence has thus become one basis for its claim. Very similar pieces of history are trotted out to justify claims to other islands visited by ships from China. Likewise, China's assumption of hegemony is often based on the fact that foreign merchant ships had to pay taxes to trade with China.

History, however, shows that Chinese sailors were latecomers to the South China Sea, let alone to onward trade to the Indian Ocean. The seagoing history of the region, at least for the first millennium of the current era, was dominated by the ancestors of today's Indonesians, Malays, Filipinos and (less directly) Vietnamese. Thus, as China's own records reveal, when the 4th century Buddhist pilgrim Fa Hsien, went to Sri Lanka, he travelled from China to Sumatra and then on to Sri Lanka in Malay ships.

This was not the least surprising given that during this era of sea-going prowess, people from Indonesia were the first colonisers of the world's third largest island, Madagascar, some 4,000 miles away. (The Madagascan language and 50% of its human gene pool are of Malay origin.) This was a thousand years before the much-vaunted voyages of Chinese admiral Zheng He in the 15th century.

Malay seagoing prowess was to be overtaken by south Indians and Arabs, but they remained the premier sea-farers in Southeast Asia until well into the era of European dominance of the region. Indeed, the Malay-speaking Hindu (like much of Southeast Asia at that time) mercantile state of central Vietnam dominated South China Sea trade until the 15th century. The 10th century Arab traveller and geographer al-Masudi made reference to the "Cham Sea", and trade between Champa and Luzon was well established long before the Chinese drew their 13th century map. As Scarborough Shoal not only lies close to the Luzon coast but is on the direct route from Manila bay to the ancient Cham ports of Hoi An and Qui Nhon, it was known to the Malay sailors long ago.

All in all, the Chinese claim to have 'been there first' is like arguing that Europeans got to Australia before its aboriginal inhabitants. But given China's reluctance to acknowledge that Taiwan was Malay terri-tory until the arrival of European conquerors, and then of a surge of settlers from the mainland, such refusal to acknowledge the rights of other peoples is not surprising.

At times, China itself seems to recognise the flimsy basis of some of its historical claims. In the case of the Scarborough Shoal, it backs up its position by reference to the Treaty of Paris 1898 concluding the Spanish-American war and yielding Spanish sovereignty over the Philippine archipelago to the US. This did not mention the shoal but described a series of straight lines drawn on the map which left the shoal a few miles outside the 116E longitude defined by the treaty.

Given that China rejects "unequal treaties" imposed by western colonialists, it is remarkable to find it relying on one between two foreign powers conducted without any reference to the inhabitants of the Philippines. Vietnam can equally well claim all the Spratly Islands as inheritor of French claims over them.

For sure, China has the power to impose its will. But its aggressive stance towards the Philippines, so often seen as an especially weak state, has alerted others, including Japan, Russia and India as well as the US, to its long-term goal which is not ownership of a few rocks but strategic control of the whole sea, a vital waterway between northeast Asia and the Indian Ocean, the Gulf and Europe. The Scarborough Shoal is not just a petty dispute over some rocks. It is a wake-up call for many countries.

Source: TOI, May 18

Summary Exercise May 16 2012

Read the following article and write a summary of around 70 words and tally it with summary provided on the Answers Page.


The government's inability to curb surges in food prices is a significant reason for rising discontent with the Centre, although state governments are to blame too. One of the bizarre contradictions facing the country is that while food prices continue to rise, we also grope desperately for finding adequate storage facilities for mountains of rotting food grain following a record harvest. But it is not just foodgrains like rice or wheat - which account for most of the food stocks of around 53 million tonnes - that are driving up food prices. Those of vegetables, pulses and edible oils are soaring much faster. 

The sharp increase in the price of high-value food products has been rather more regular in recent years with food consumption patterns changing sharply in line with growing incomes. Consumption trends show that while the average quantity of rice, wheat, coarse cereals and pulses consumed per person has declined significantly over the last few decades, that of some other food items like edible oils, fruits, vegetables, milk, eggs, fish and meat has gone up sharply, resulting in a growing mismatch between demand and supply. 

Despite such significant change in demand patterns, government policies continue to focus on foodgrains which corner the most benefits from fertilizer and electricity subsidies to higher procurement prices. These huge costs curtail spending on more immediate priorities like improving agricultural practices, research, irrigation and other rural infrastructure needed to scale up productivity of other high demand products. State governments, which have a major say in agriculture, make matters worse with high taxes on agriculture markets and restraints on transport and stocking of food products, deterring private investment in marketing infrastructure. The end result of these distortions is weak transmission of price signals from markets to producers and, therefore, inability to meet demand. 

Improving supply of food products in demand, so badly required for bringing down food inflation, requires restoring the market mechanism to ensure a faster diffusion of the price signals from the consumer to the producers. For this the government should stop funding programmes that distort prices and divert resources required for raising agricultural productivity. Agriculture markets also have to be strengthened by provi-ding more incentives for building new facilities and increasing competition by adding more players including organised retail. This will ensure that farm gate prices move in tandem with market prices, and improve supply to bring down food price increases to acceptable levels.

Summary Exercise May 14, 2012

Read the following article and write a summary of around 70 words and tally it with summary provided on the Answers Page.


The hits just keep on coming. We've had the Standard & Poor's downgrade, a collapsing sensex, an eroding rupee - and on Friday the news that industrial output in March contracted by 3.5%, bringing the average industrial growth rate for the last fiscal year almost as low as it was during the global financial crisis in 2008-09. But the enormity of the negativity surrounding India's economy has even deeper roots than these problems.

We can call the fundamental factors causing that negativity the 'triple whammy'. Global corporates have been tentative about India for a while already. Those who habitually tour Davos will tell you that the browning off vis-a-vis India started at least two years ago. Coincidentally or not, it fits in well with the return of the UPA.

Government had initially dismissed it as just a phase. It insisted that the world was turning away from India only because Europe and the US had serious problems of their own in the wake of the market slump. Frighteningly, even those who examine 'moods' more closely were unable to see that while all those pullback factors were true, something was truly wrong in our Garden of Eden. Despite our huge demographic dividend, massive consumption demand and substantial market opportunities, global companies were showing an inexpli-cable new reluctance to enter the fray.

But the government continued to insist that any slowdown in investor enthusiasm was only scare-mongering by vested domestic interests pushing for more sops, freebies and tax breaks. And they insisted, last week, that this March we had attracted the highest ever FDI of $8.1 billion.

The 'triple whammy' or the three E's that i am focussing on had begun to operate well before all that - but it all came dramatically into focus last month when Adidas announced a Rs 1,350 crore hit and sacked its local Reebok management. Then, it proceeded to announce that 300 shops bearing the Reebok logo and 200 with Adidas logo would also be closed.

The blame was squarely placed on the Indian executive management for fudging the books. The big theme that resonated across the corner offices of global corporate headquarters was simply this: There is now reason to worry about Indian employees! By casting aspersion on the quality of Indian executives, Adidas had delivered a resounding blow to the corporate Indian psyche. This is the first of the three eroding E's.

The second E is worse. It is now recognised as a seething virus across the corporate landscape - a lack of faith in the nature of Indian enterprise. The fracas that took place in 2009 between Daiichi Sankyo, the Japanese buyers of Ranbaxy, and the original owners is merely the most obvious example of it. The US Food and Drug Administration banned the import of Ranbaxy medicines because of unresolved concerns over quality audits at two of its factories in India. Daiichi was forced to reveal a $3.8 billion loss on its Indian acquisition barely six months after the deal! Global distrust about big ticket acquisitions of Indian enterprise had reared its ugly head.

Distrust is something corporates everywhere, but more so in Japan, are spooked by. Ranbaxy is only an example. Below the radar, other giant Japanese corporations are also known to have had problems with large-scale buyouts of Indian enterprises. Whether the problem lies in their hurry or incompetence in doing their due diligence or in the even greater capability of some Indian managements to extract stratospheric value with devastating faultlines carefully papered over, is a matter both of conjecture and, unfortunately, now of some lawsuits. The word is now out that Indian entrepreneurs can't be trusted easily. E-2 is in place.

As if whammy E-1 and E-2 were not enough, the government too contributed its bit to the third E - ruining the business environment. Just one example should suffice. In the aftermath of the2G scandal, when the Supreme Court announced this February that licences were cancelled, its forthcoming spectrum policy and auction parameters made global corporations go cross-eyed. Whether posturing or otherwise, giant telecom majors from across the world have subsequently had to inform their boards that they are taking massive hits on their balance sheets. Global head honchos have had to issue ultimatums to the Indian government that they might consider withdrawing.

Irrespective of where the faultlines lie and who is to blame, all of this once again brings up E-2 - the culpability of domestic entrepreneurs in selling tainted goods to global partners. Rather than mitigate matters, the government has made them much worse. Whammy E-3 has now been delivered. The message that has gone out is that the government of India no longer cares about attracting investment.

Serious doubts have been raised about the three fundamental building blocks of business i.e. the quality of employees, the quality of entrepreneurs, and the environment crafted by the government. No amount of ra-ra-ing by Indian associations is going to work anymore. The image of India has been disfigured by the triple whammy of insult, injury and incompetence. What's left is the old fluff of a growing economy with 7% growth possibility, demand unmet and enthusiasm unbridled. But are these sufficient for giant global corporations? That's the real question.

Summary Exercise May 12

Read the article and write a summary of around 70 words. Then tally it with the summary given in the answers page.


It seems like a very long time ago when in 2000 the European Union proudly adopted 'united in diversity' as its motto. Rising anti-immigrant anger has now found its way to the union's halls of parliament, badly denting that motto. A combination of terrorist attacks, economic transformations and financial crises has put European liberalism on the defensive. 


A rapidly ageing continent may require even higher numbers of immigrants but fears of being crowded out by alien races, religions and cultures are leading many countries to close their borders. The fear has empowered ultra right-wing parties, giving them disproportionate political power. The recent Greek and French elections saw xenophobic parties make substantial inroads in national politics. 

The neo-Nazi Golden Dawn party of Greece, which has so far made its mark through street violence against immigrants, won a stunning victory. Its 7% vote in the elections gave it 21 seats in Parliament, the first ever by the party. Its rough tactics and Nazi salutes may not win it a much wider following but its victory is a harbinger of societal crisis. And in the first round of French presidential elections, the ultra-right National Front led by Marine Le Pen won almost one in five votes. Railing against Islam, immigrants and the common currency - the euro - Le Pen hopes to build on this foundation to secure enough seats in the coming legislative elections. Emerging as one of the main challengers, if not the leader of opposition, against Francois Hollande, she hopes to alter the direction of the country's policy. 

Geert Wilders's Party for Freedom (PVV), Le Pen's counterpart in the Netherlands, did just that. Though only a minority party, it has brought down a government by withdrawing its support from the ruling coalition. In over a dozen other European countries, anti-immigrant, right-wing parties have continued their advance, capturing 15% to 20% of the electorate, and in seven countries, forming a significant minority party to support coalition governments. 

Europe has always had an ultra-right, anti-Semite fringe. But the groups have undergone significant changes in politics and character. Since the September 11 attacks and other strings of terrorist incidents - from Madrid to London - Islam and Muslim immigrants have emerged as the major target of extreme right-wing anger. The other ultra-right targets are people from Eastern and Central Europe who have migrated to the West after the expansion of the European Union. They are accused of stealing jobs from locals. 

Recent upheavals in North Africa and the Middle East have produced a new wave of immigrants, spooking Italy and France. Ultra right-wing parties in Netherlands and Belgium have set up websites encouraging vigilantism against immigrants. Actions against unassimilated immigrants, accused of stealing jobs and committing petty crimes, have won some popular support for these ultra-right wing parties, and the thuggish Golden Dawn in Greece. 

Surprisingly - and worryingly for liberal Europeans - support for ultra-right wing causes is no longer confined to the poor, uneducated and unemployed. Polls show a significant number of the educated middle class, owners of small business and even employees of large corporations supporting anti-immigrant and anti-EU causes. In an ironic twist, they have adopted their erstwhile leftist opponents' slogans of human rights, secularism and gender equality as a battle cry against Islam. 

Jeans-clad Le Pen, who calls herself a 'feminist', has the highest following in the 18-24 age group. Heinz-Christian Strache of the Austrian ultra-right wing Freedom Party dons a Che Guevara T-shirt and Wilders woos the Jewish lobby by comparing the Quran to Mein Kampf. Their wide use of social media has brought together extreme right-wingers in Europe who reinforce each other's messages to carve out an increasingly large cultural space. 

The rise of these groups has been facilitated in recent years by the debt crisis, which produced harsh austerity measures, higher taxes and skyrocketing unemployment. In the anger against Islam, immigrants and multiculturalism, basic economic facts have been ignored. Immigrant workers not only contribute to the European economy, but, as an OECD report puts it, "on average a net inflow of slightly less than 1.5 million labour migrants per year would be required" to keep it running. Diversity in unity is not merely the motto of an ailing union - it also has a practical economic value.

Summary Exercise May 9

Read the following article and write down a summary. Compare your summary with one given in the answers.

Prometheus, who gave the gift of fire to humankind, was punished by the gods by being shackled to a rock. In replay of the Greek myth, the Indian people have been chained to the rock of governmental inertia. The Indian diaspora has shown that wherever people from this part of the subcontinent go, they excel economically, seeming to carry within themselves the fire of initiative and enterprise. So why is it that within our own country we remain such tragic failures, with an estimated 60% of the population said to be on or below the poverty line?

Who has kept the Indian Prometheus chained for all these years? That long-asked question has once again gained topicality against the backdrop of the so-called policy paralysis of which the government has been accused. This is a false accusation. What we are witness to today is much worse than policy paralysis. What India is suffering from - and has suffered for years - is not policy paralysis but ´people paralysis´: the tough, resilient, endlessly innovative people of India have, like Prometheus chained to a rock, been paralysed by the political and bureaucratic gods who rule them.

India - tom-tommed as the world's second fastest-growing economy - is on the threshold of gaining independence from a tyranny more oppressive and deeply entrenched than that of foreign rule: the tyranny of age-old poverty and deprivation. India is at an historic turning point. Or it could be, if it weren't  for the paralysis imposed upon the get-up-and-go, on the can-do, will-do self-confidence of its people. With the so-called ´developed´ economies either stagnant or in decline, the field has been made clear for the two emerging Asian contenders - China and India - to take the lead and change the economic map of the world.

Indeed, even as totalitarian China surged ahead in terms of growth rate, several international analysts placed their long-term bets on India which, thanks to its youthful and productive population and its democratic rule of law, was forecast to be the odds-on favourite. Then India hit a roadblock which significantly slowed its growth. Several reasons have been given for this, among them being continuing uncertainties regarding the global economy and the rising prices of oil and other inputs. But the most self-evident reason is that of the inability of the government to carry out much-delayed economic reforms because of the so-called 'compulsions' of coalition politics. All of a sudden, India's democratic advantage over China seems to have become a disastrous disadvantage.

Aside from intransigent allies who oppose everything from FDI in retail to cutting down on fuel subsidies, the government seems to be its own worst enemy by proposing regulations regarding retrospective taxation which not only undermine investor sentiment but sabotage the rule of law and the sanctity of contract which are the bedrock of any real democracy. The truth is that - frequent and noisy elections notwithstanding - India is a democracy more in name than in observance.

Democracy means the progressive empowerment of the people who compose the polity. If this is the yardstick for democracy, India fails the test. For not just this government, but successive regimes ever since Independence have wilfully or otherwise obstructed the empowerment of the Indian people, keeping them chained to poverty, illiteracy and lack of opportunity.

One of the consequences of this is the Maoist menace that holds hostage large tracts of the country. The red revolt mistakes frenzy for freedom. But it should be a warning for those who for far too long have kept bound the Indian Prometheus. When, and how, is the captive to be set free?