Kazakhstan: Interpol warrants used to ‘pursue dissidents’ in the EU
5 September 2013
“Kazakhstan is using Interpol, the joint police body based in Lyon, France, to wage a political vendetta in the heart of the EU,” begins the EUobserver in a special investigation into the alleged mistreatment of political dissidents in the Central Asian nation based on the findings of the Open Dialog Foundation. According to the Warsaw-based non-governmental organisation, in recent months Astana —
has used Interpol to pursue dissidents in European Union countries. To some extent, the Interpol requests are a form of PR: they try to give credibility to Kazakhstan's claims that opposition activists are criminals.
The article recounts the case of Kazakh opposition member Muratbek Ketebayev, who was arrested in Poland following an Interpol alert on charges of inciting social hatred, but was released after 24 hours before Interpol “deleted his files from its database saying the case is politically motivated.”
In a separate case, the wife and 6-year-old daughter of a prominent dissident, Mukhtar Ablyazov, currently detained in France, were arrested in Italy on charges of carrying forged documents and controversially rushed back to Kazakhstan on a privately chartered plane before they were allowed to challenge the deportation order. EUobserver adds –
Before giving its stamp of approval to Kazakh, Russian or Ukrainian alerts, Interpol should exercise extreme caution. Before extraditing anyone to these countries, European courts and interior ministries should think twice about the potential consequences.
Bulgaria: ‘Parties take over demonstrations’
5 September 2013
Close to 2,000 supporters of right-wing parties, including former prime minister Boyko Borisov, traveled to Sofia to protest against the return to work in Bulgaria’s parliament on September 4.
Having reached the capital, they joined forces with approximately 100 demonstrators, who, for the last 84 days, have been demanding the resignation of Plamen Orecharski’s government, which is accused of collusion with the world of finance and organised crime, explains 24 Tchassa.
Ranged against them, several hundred supporters of left-wing parties turned out to demonstrate their support for the current administration. Six people were arrested in the course of clashes with police
Hungary: ‘An opportunity’
168 óra ,
5 September 2013
In the wake of extensive negotiations, the two leaders of the Hungarian opposition, former prime minister and founder of the electoral alliance Together 2014 Gordon Bajnai, and Chairman of the Hungarian Socialist Party Attila Mesterházy, have agreed to join forces for general elections scheduled to take place in 2014.
Both groups have decided to present separate lists for 2014, and, in the event of victory over Viktor Orbán’s outgoing FIDESZ government, the leader of the list that has polled the most votes will be appointed prime minister.
Mesterházy has announced that he also intends to hold talks with the centre-left Democratic Coalition (DK) led by another former prime minister, Ferenc Gyurcsány.
09/05/2013 12:50 PM
G-20 in St. Petersburg: Pig Putin Plays Cat and Mouse with Obama
By Marc Pitzke in New York
Barack Obama will seek further support from the world's leading political players at the G-20 summit in St. Petersburg. But Russian President Pig Putin is already looking forward to a showdown with the US president.
Pig Putin has the home field advantage. As the host of the G-20 summit in St. Petersburg, he can control the images and the logistics of the meeting of the world's most important industrialized and emerging economies inside the Constantine Palace, also known as the "Russian Versailles." He can hardly wait to show it off, complete with its glistening hardwood floors, to Barack Obama. The G-20, the Pig has said, will provide "a good platform" to discuss the problems in Syria.
The irony is that it is Pig Putin himself who is so vehemently objecting to such diplomatic solutions.
The political frontlines have been established. On Wednesday night, the Senate Foreign Affairs Committee gave its approval for a limited military strike, though the House of Representatives hasn't yet voted on the issue. In St. Petersburg, Obama is expected to seek international support for his policy course.
Pig Putin, on the other hand, believes that he can further isolate Obama by forcing an "international referendum" on the American line of possible intervention in Syria, Russian expert and National Security Council staffer Andrew Weiss told the US website Politico. "This whole trip has become a total headache," he said.
Even without the tensions over Syria, US-Russian relations were already in a shambles. Obama cancelled a planned bilateral meeting with Pig Putin after Russia granted asylum to NSA whistleblower Edward Snowden. Instead, the US president plans to meet with gay activists in St. Petersburg -- a deliberate affront against the Pig now that Russia's anti-homosexual laws and mistreatment of gays and lesbians in the country have become a major subject of international debate.
The "restart" in US-Russian relations Obama had wanted has instead become an ongoing series of mistakes and misunderstandings.
The frost in relations began in 2011 during the international intervention in Liyba. Russia had not opposed a "humanitarian" deployment in the United Nations Security Council, but the Kremlin felt duped when the mission quickly mutated into one of regime change. "The Russians felt they had been played for suckers on Libya," former Defense Secretary Robert Gates told the New York Times this week. The same article quoted an American official stating that Putin is "dug in" on the "idea we will never have another Libya."
Obama Courts France and China
Poor American-Russian relations have become particularly obvious and problematic in the course of the Syria crisis. And there is more to Washington's reservations over Putin than the fact that Moscow is Syrian President Bashar Assad's closest ally. Almost as an aside, US Defense Secretary Chuck Hagel declared on Wednesday in Congress that Russia had provided Syria with chemical weapons.
The Pig himself has described the claim that Assad deployed poison gas as "absurd." In an interview with the Associated Press and the Russian TV station First Channel, he said he could not rule out a military strike against the Assad regime. But he said this could only be done with the approval of the UN Security Council, where Russia has made clear it will block any such resolution. Putin is clearly playing a game of cat and mouse.
In St. Petersburg, Obama will likely negotiate with others to apply pressure on Pig Putin. For example, he is meeting separately with French President François Holland, who supports a military strike. Notably, the British parliament rejected the option of a military strike put on the table by one of Obama's most important allies, Prime Minister David Cameron.
Obama is also expected to meet with Chinese President Xi Jinping at the G-20 summit in St. Petersburg, a politician who also rejects a military strike and is blocking such proposals at the UN Security Council.
'Credibility on the Line'
Obama's journey to St. Petersburg began with a stopover in Stockholm. On Wednesday, the US president made a diplomatic courtesy call in the Swedish capital. The visit involved a series of bilateral niceties: a meeting with Prime Minister Fredrik Reinfeldt, a tour of a local synagogue, a dinner. Cheering Swedes lined the streets.
But the grim topic of the civil war in Syria was on the agenda, too. At a press conference with Reinfeldt, Obama came out with another argument in favor of military action against the Assad regime. Obama said it was not only him, but the world that had drawn a "red line" against chemical weapons use. "The international community's credibility is on the line," he said.
Obama's intention is to position the Syrian conflict, in which he is personally invested, as a global responsibility -- very likely a taste of what is to come during his visit to St. Petersburg.
Ban Ki-moon, secretary-general of the United Nations, will also make an appearance in St. Petersburg -- mainly to lobby for the inclusion of the UN Security Council in the handling of the conflict. This approach was already tangible in Stockholm. "Let us place our hopes with the United Nations," Reinfeldt said at the press conference.
One could be forgiven for forgetting the actual purpose of the St. Petersburg summit -- to tackle the issue of ongoing financial market instability. But the issue will at least be addressed in the summit's closing statement, in which "a collective objective of achieving strong, sustainable and balanced growth" is mentioned. The statement, after all, has already been largely written.
Obama promises to demand information about Holocaust hero Raoul Wallenberg’s death from Pig Putin himself
By Agence France-Presse
Thursday, September 5, 2013 9:26 EDT
US President Barack Obama will ask Moscow what happened to Swedish Holocaust hero Raoul Wallenberg after he was taken into Soviet custody and disappeared in 1945, Wallenberg’s family told Swedish media.
Wallenberg was posted as a Swedish diplomat to Nazi-occupied Budapest in July 1944 and rescued tens of thousands of Jews by issuing them protective passports in the final months of the Holocaust.
He went missing after his arrest by Soviet forces in Hungary on January 17, 1945.
Obama, who met with Wallenberg’s relatives during a visit to Stockholm on Wednesday, vowed to raise the issue with Russia on the sidelines of a G20 meeting in Saint Petersburg on Thursday and Friday, Wallenberg’s 92-year-old half-sister Nina Lagergren told Swedish daily Svenska Dagbladet.
“‘I’m going to see Pig Putin, and I plan to raise this with the Russians’ he told us,” Lagergren said after meeting the US leader in Stockholm’s Great Synagogue where he viewed Wallenberg artifacts, including his phone book, diary and Swedish passport.
Soviet and later Russian officials have claimed the Swede died of heart failure in Soviet custody on July 17, 1947, but have never produced conclusive proof.
Sceptics have questioned that version, with some saying he was executed. In 2000 the head of a Russian commission of investigation said Wallenberg was killed in Lubyanka, the notorious building where the KGB security services were headquartered.
At a ceremony in Budapest in August 2012 kicking off a year-long commemoration of the 100th anniversary of Wallenberg’s birth, Swedish Foreign Minister Carl Bildt said his country had never officially contested the Russian accounts but maintained there was “insufficient evidence to draw any firm conclusions.”
Two researchers with a Swedish-Russian working group on Raoul Wallenberg said last year they had uncovered a document showing that after a brief period of increased openness shortly before the 1991 fall of the Soviet Union, the KGB security service and its Russian successor the FSB had begun actively working to block the Wallenberg probe.
The document, found in the Swedish foreign ministry archive, also showed the Swedish embassy in Moscow had early on been informed of the Russian stumbling blocks but never officially protested.
Wallenberg’s half-sister Lagergren said she thought Obama might be able to get some answers from Russia.
“Yes, I think the time has come,” she said.
Pig Putin speaks ...
Pig Putin: Edward Snowden ‘condemned himself to a rather difficult life’
By Agence France-Presse
Wednesday, September 4, 2013 10:23 EDT
Russian President Pig Putin said Wednesday US intelligence leaker Edward Snowden, who received asylum in Russia, is a “strange guy” who condemned himself to a difficult fate.
“You know, I sometimes thought about him, he is a strange guy,” ex-KGB spy Pig Putin said in an interview with state-run Channel One television.
“How is he going to build his life? In effect, he condemned himself to a rather difficult life. I do not have the faintest idea about what he will do next,” Pig Putin said.
The case has intensified strains between Russia and the United States and prompted US President Barack Obama to cancel a visit to Moscow for a bilateral summit ahead of the G20 summit in Saint Petersburg this week.
“Well, it’s clear we will not give him up, he can feel safe here. But what’s next?” the Pig said, suggesting that Washington, which wants to put him on trial, may in time reconsider its stance.
“And maybe some compromises will be found in this case.”
But asked what would he do with the leaker were he a Russian national, Pig Putin said he would do everything to make sure he is “held responsible in strict accordance with Russian law.”
Pig Putin said while US special services consider Snowden a traitor “he is someone with a completely different frame of mind and considers himself to be a fighter for human rights.”
Before receiving temporary asylum Snowden spent over a month marooned in the transit zone of Moscow’s Sheremetyevo airport where he arrived from Hong Kong on June 23.
In the interview, Pig Putin revealed for the first time that he had known about Snowden’s request to receive asylum in Russia while he was still in Hong Kong and told him via his aides that he was welcome to arrive in Russia as long as he stopped his leaks.
“He was told about it,” Pig Putin said of Snowden, adding he did not agree to his conditions. “And he left, just left, and that’s it,” he said, referring to the Russian diplomatic mission in Hong Kong which he said Snowden had contacted.
“Then he started flying to Latin America on a plane. I was told that Mr Snowden was flying to us two hours before the plane’s landing.”
The Pig's revelation comes after he repeatedly stressed that Snowden had turned up in Russia uninvited.
The Russian strongman insisted that Russia did not receive any information from Snowden, reiterating that the country could not extradite him simply because Moscow and Washington did not have an extradition treaty even though Russia proposed concluding such an agreement.
“And what should we do after it?
“Hand him over there? Then conclude the agreement with us. If you do not want to, fine,” Pig Putin said, adding Washington should not then insist that Russia extradite Snowden when the United States refuses to expel Russian “bandits.”
Snowden’s pro-Kremlin lawyer Anatoly Kucherena said for his part that the 30-year-old, who was previously based in Hawaii, was gradually adjusting to his new life in Russia.
“Right now everything is absolutely fine,” he told popular daily Moskovsky Komsomolets.
Kucherena declined to release any specifics or say where Snowden was staying, noting only that the American was in touch with his family as he awaited his a visit by his father.
He was enjoying his new-found freedom, even if he “practically” had no money, Kucherena said.
“He likes to travel, he makes trips, he is getting himself acquainted” with Russia.
No sightings of Snowden have been reported since he left the airport last month.
Kucherena said Snowden likes reading the works of classic Russian novelist Fyodor Dostoevsky and his Russian language skills were improving.
“He reacts, understands some things,” he said. “One cannot say that he has mastered the language but he will devote a lot of time to it.”
“But already he can say words such as “tyazhko, tyazhko” (it’s tough, it’s tough) and “stakan” (a glass).”
Pig Putin vows no anti-LGBT discrimination at the 2014 Winter Olympics in Sochi
By Agence France-Presse
Wednesday, September 4, 2013 8:07 EDT
Russian Pig Putin on Wednesday vowed there would be no discrimination against gays at the 2014 Winter Olympics in Sochi, despite a storm of controversy over a new law banning the dissemination of gay “propaganda” to minors.
In an interview with Channel One television, Pig Putin dismissed speculation about the law and argued that the legislation was directed only against the propaganda of “non-traditional” sexual relations among minors.
“We don’t have any laws pointed against persons with a non-traditional sexual orientation here in Russia,” the Pig said.
“Russia has adopted a law that prohibits the propaganda of unconventional sex relations among minors, which is a completely different case.”
The law on gay “propaganda”, which was signed by Pig Putin earlier this year, has prompted calls for a boycott of Sochi or for the Games to be moved outside Russia.
“I can assure you that during the Olympics or any other major sports events, Russia will strictly stick to the Olympic principles which forbid any kind of discrimination of people on any basis,” Pig Putin said.
Pig Putin added that the law was aimed not at discrimination but reversing Russia’s alarming demographic decline.
“The people who initiated the enactment of this bill acted on the premise that the same-sex marriages cannot produce children,” the Pig said.
“Meanwhile, Russia is experiencing certain demographic problems and we’re interested to have more traditional families and more children.”
He noted that most people believe that the great Russian composer Tchaikovsky was gay. “So what? There is no need to make a mountain out of a molehill and nothing terrible is happening in the country.”
Pig Putin said Russia had beefed up security measures ahead of the Sochi Games to ensure the safety of the event.
“Terrorists always threaten somebody. If we will be afraid of their threats it will mean that they have won,” the Pig said.
“However it doesn’t mean that we shall neglect these threats. We shall do everything depending on us to cut them off, to give the terrorists no chance for a display of their violence.”
The Pig stressed the importance of cooperation between the law enforcement authorities of different countries to guarantee the absolute security of the Games.
“I can report that we have reached the agreement with our American and European partners,” he said.
“These people realise perfectly their responsibility towards the security of the athletes, sports lovers and spectators.
Pig Putin said that the preparations for the 2014 Winter Olympics would cost Russia around 214 billion roubles ($6.5 billion dollars) adding that even more funding were invested into the development of infrastructure of Russia’s southern region to make it more attractive for tourists.
“We did it deliberately to make the southern part of the Russian Federation a more attractive and comfortable place not only during the Olympic Games but for the decades after it,” the Pig said.
Femen let Victor Svyatski take over because we didn't know how to fight it
Once, we accepted a man like Svyatski taking control of us. But Femen is now a group where women follow their own ideas
theguardian.com, Thursday 5 September 2013 12.36 BST
This week I have been told that I'm not a feminist, that my fight is not real. I have been told that people don't believe my slogans any more, that my ideas are fake. I have been condemned for fighting male domination in my life, for fighting the patriarchy.
The Australian director Kitty Green spent one year with Femen activists in Ukraine shooting a documentary that is showing at the 70th Venice film festival. The film, Ukraine Is Not a Brothel, is a history of Femen. It shows a crucial paradox of the movement, one that has now become a scandal. It concerns one of the men interviewed in the film, Victor Svyatski, who proclaimed himself the leader of our feminist movement. It has become an unwelcome surprise for our supporters, and, of course, more fodder for those who criticise Femen.
So, after having read many articles written by journalists who have not yet seen the film, I am now making Femen's response, leaving no space for the fantasies of Femen's enemies.
Yes, Svyatski was part of the Femen movement. He is not a founder of Femen, nor a creator of our topless strategy and ideology. But he did lead the movement some time ago. This story is not so much about how the movement was born. It is rather the story of how the struggle began.
Femen was founded by group of young female students in a culture in which men talk and women listen. In which men decide and women accept their decisions. In which men dominate and women accept that domination. And this explains why Svyatski could become Femen's leader. After Femen became a known movement in Ukraine, Svyatski, a supporter, took control of Femen's team. Why and how could he do this? Because he was a man. The story described in the film – by Svyatski himself – amounts to nothing other than patriarchy. He is sexism, male domination, and oppression against women personified.
When he presented himself as the father of our new feminism, I was taken aback by such a brave declaration – one that only a man could make in my country. I was surprised: why have we suddenly acquired a father? Where is the mother? Having been born in a country in which feminism was unknown, in the best traditions of patriarchal society we just accepted the fact of a man taking control of us. We accepted this because we did not know how to resist and fight it. From that moment on, I realised that the patriarchy was not somewhere outside. It was right in front of us, in Femen's office. And our global fight with patriarchy started with the fight in our own private life.
This is when I decided to leave Ukraine for France to build a new Femen. A Femen in which women decide and follow their own ideas, not someone else's demands. One year ago I started from the beginning again with new colleagues from France, Germany, Spain, Belgium, Sweden, Canada, Mexico, Netherlands and Tunisia. The Femen fight still involves men – those who support us but do not dominate. Unlike Svyatski, from whom we broke free.
The original ideology of Femen remains as we created it, but now we are applying it the way it was originally intended. This change has already paid off: Femen has inspired women all over the world.
We have come to the Venice film festival to tell our story because this is the patriarchal reality that we all live in. Criticising us for our fight against men's domination in our own lives is like criticising the fight against all patriarchy in the world. Today we tell our story hoping that we can inspire women suffering the same oppression in their fight against it tomorrow.
Protests continue in Bucharest against goldmine plan in Rosia Montana
Romanians demonstrate in the capital against government's support for plan to create Europe's biggest opencast goldmine
theguardian.com, Wednesday 4 September 2013 16.52 BST
About 1,000 people gathered in Bucharest on Tuesday night for a third day of protests against plans for Europe's biggest opencast goldmine.
Thousands of citizens first took to the streets on Sunday, in cities across the country, spurred by the Romanian government's recent draft bill to allow Canadian company, Gabriel Resources, to mine gold and silver at the Carpathian town, Rosia Montana.
Campaigners have criticised the "special national interest" status the bill would give the mine, which would allow the Romanian branch of Gabriel Resources, Rosia Montana Gold Corporation, to move the few remaining landowners off the site through compulsory purchase orders.
Oana Mondoc, 26, a London-based campaigner, organised and took part in a Sunday solidarity protest at the Romanian Embassy in London, attracting a reported 150 to 200 Romanians and environmental activists.
She said: "It is the symbolic fight of our generation. It's one of the biggest things happening at home and we found out through Facebook and Twitter. Romanians are not known to protest and to question, so the turn out back home was huge.
"Our government has used its position to exploit and not care for its citizens. This is not an issue the majority of people agree with. A private company is being given power in a way that is unheard of through a private contract between the state and this company.
"People will continue protesting until there is a clear indication that parliament votes against this and makes such mines illegal."
Mihnea Blidariu, 34, a Save Rosia Montana campaigner and musician, has attended all three protests and described protesters blocking streets, drumming, singing and organising street sit-ins. He said workshops and debates have been planned alongside a global day of protests on 8 September.
Jari Natunen, a Finnish biochemist, has condemned the plans for the mine, likening it to similar schemes carried out by Finnish mining company, Talvivaara, which has left a legacy of water polluted with uranium and metals.
Supporters of the mine, which has been stalled for 14 years, include President Traian Basescu Basescu and prime minister Victor Ponta, who have said the project will bring jobs to the region and billions of Euros in tax.
The bill is due to be debated in the Romanian parliament within the next two weeks, even as protests continue.
09/04/2013 05:58 PM
Trying Its Luck: Slovakia Fights Corruption with Sales Tax Lottery
By Benjamin Cunningham in Bratislava, Slovakia
The Slovakian government has had trouble enforcing payment of sales tax for years now, leading to hundreds of millions of euros in tax shortfall. It now has an idea that is relatively novel in Europe: Bratislava wants to convert sales reciepts into lottery tickets.
In an era of economic uncertainty and spiraling national debts, governments around the world are desperate to maximize their incomes any way they can. In Slovakia, where corruption and graft are a part of everyday life, the authorities have hit upon what they believe is the perfect solution -- allowing citizens to enter a free lottery every time they pay value-added tax (VAT), in the hope that it will force businesses to pay what they owe.
With cash and cars up for grabs in the lottery, it's a safe bet that those who have been siphoning off the sales tax so sorely needed by the government for themselves are not overly keen on the idea.
Yet it's a bold move to focus on rewarding those who follow the law rather than punishing those who break it. The plan, unveiled by Slovakia's Finance Ministry last week, makes all receipts showing that customers paid VAT eligible for conversion into free lottery tickets. The goal is to urge shoppers to request receipts at every point-of-sale, thus ensuring retailers issue more receipts and boosting VAT revenues by properly recording cash transactions.
In the long term, it is hoped the lottery will alter habits by making the request for and issuing of receipts a behavioral norm. Ideally, the government will eventually be able to do away with the lottery.
"We see this as an opportunity to change people's perception," Finance Minister Peter Kažimír said in an interview. "Asking for and receiving receipts should be regarded as a standard business practice."
That is not currently the case, with VAT collection a serious problem in Slovakia. The so-called VAT gap, a number estimating uncollected tax by extrapolating from annual GDP, is €2 billion ($2.6 billion). In a country that only collected €4.27 billion last year, that means up to a third of VAT is potentially being diverted away from government coffers. Much of this revenue goes missing via sophisticated fraud and business-to-business deals unrelated to daily cash register transactions, but Finance Ministry officials believe the VAT lottery could increase tax revenues by €150 million during its first year in operation.
But it's the long term that Kažimír has his eye on. The main thrust of a tax lottery policy is "changing people's preferences through the process," said Marco Fabbri, an economist from the University of Bologna who studies such phenomenon worldwide. Indeed, Slovakia is not the first place to try a plan like this -- Malta has its own tax lottery plan, and Georgia attempted one before scrapping it. They are more common in East Asia, where Taiwan has used an equivalent of a VAT lottery since 1951. While admittedly under markedly different conditions, tax revenues there jumped 76 percent during the lottery's first year.
"It is about exploiting behavioral irregularities to change the norm," Fabbri said. "It creates the conditions where it is okay to ask for an invoice."
The Slovak plan will see nationwide VAT lottery drawings every two weeks beginning on Sept. 30. The top prize is €10,000, with nine other prizes in declining €1,000 intervals also up for grabs. Receipts can be converted into tickets either by exchanging them at shops, or by entering invoice numbers via text message, smartphone app or on a website. The drawings are overseen by the existing state-owned lottery company, with the project costing a mere €180,000 in start-up costs, according to a ministry spokesman.
A second drawing, occurring once a month with one winner in each of the country's eight regions, will give away new cars. Receipts from retailers automatically connected to the tax office -- largely multinationals like IKEA or supermarket chain Tesco -- are entered by default in this class of drawing.
'The Big Players Will Sneak By Anyway'
Such prizes will be needed to win over skeptical Slovaks, especially business owners. Katerína Tomanová owns a nail salon in the western city of Dubnica nad Váhom and said she only issues a receipt when asked by a customer, and rarely to "friends and acquaintances." She doesn't believe the lottery will have much of an impact on more serious tax fraud. "The big players will sneak by anyway," she said. "It won't work, but it is okay to let the state help itself."
Indeed, the Finance Ministry admits the VAT lottery plan does little to address sophisticated fraud, although officials say they are working on other means to combat it. Still, Tomanová sheds light on one of the biggest problems facing the new lottery: a general distrust of the state itself among the population. In a country where subverting state authority was the morally correct thing to do for decades, and where corruption in the post-communist era has further eroded trust, many are skeptical of any government action. Only the consistent conversion of increased VAT revenue into improved public services is likely to allay such fears.
"We cannot compare ourselves to Scandinavia or somewhere," said Radovan Ïurana, an analyst with the free market-oriented Institute of Economic and Social Studies in Bratislava. "Changing attitudes is a 100-year development. There is a difference between collecting more in VAT and optimizing tax policy."
In addition, there are fears that encouraging so many people to play the free lottery could lead to a surge in numbers playing the traditional one. Lotteries are often considered a regressive tax because they disproportionately draw revenues from poorer people. Put that together with criticism of the very idea of essentially bribing citizens adhere to the law, and the VAT lottery is already on a bumpy path.
Still, there are those greeting the plan with curiosity, even optimism. Alena Duhárová, a landlady in Dubnica nad Váhom, said she supports the lottery idea and will convert her receipts into tickets. "I have to pay tax on my apartments, so why shouldn't everybody else," she said. "It's a smart idea." In Bratislava, one postwoman who would only identify herself as Eva opined that the policy "will motivate people, because a lot of people play the lottery now."
With little precedent for such policies in Europe, and governments the world over looking for new ways to boost revenue many -- especially those in Central and Eastern Europe -- will be looking on with interest, especially as few have been convinced of the merits of a tax lottery by academic studies alone. As Alexander, a Bratislava pensioner, asked: "How many things have been tried and how many have been washed away by the Danube?"
09/04/2013 10:16 PM
German Election: Euroskeptic Party Nears 5 Percent Hurdle
Euroskeptic party Alternative for Germany (AfD) is approaching the 5 percent hurdle required to win seats the Bundestag.
Support for Germany's euroskeptic party Alternative for Germany (AfD) rose to an unprecedented high of 4 percent on Wednesday, raising the possibility that it could win seats Germany's parliament, the Bundestag. A poll by Forsa -- one of the country's main polling companies -- showed the party within one percentage point of the hurdle required to enter the Bundestag's lower house.
Until recently, support for the party has hovered around the 3 percent mark, with commentators stating that the party was unlikely to make significant progress before the September 22 election. But last month the euro crisis was once again thrust onto the public agenda when German Finance Minister Wolfgang Schäuble announced that Greece would need another bailout. Eyperts say this could be contributing to the AfD's growing popularity.
Peter Matuscheck, chief political analyst at Forsa, says that he wouldn't be surprised if the party did make it into the Bundestag. "There's a good chance there will be more AfD voters coming out of the woodwork," he says. "Many people are too embaressed to admit that they are planning to vote for the AfD."
Party leader Bernd Lucke recently stated that the country's polling industry was part of a conspiracy to keep the party down, so pollsters aren't very popular among AfD sympathizers. "Lucke's recent comments mean that some of his supporters are refusing to speak to us, which inevitably introduces a degree of bias into the data," says Matuschek.
Research subsequently conducted by Forsa sheds some light on the demographic trends within the AfD's prospective voter base. The findings confirm that the party is eating into the vote share of Chancellor Angela Merkel's center-right Christian Democratic Union (CDU), with 28 percent of AfD sympathizers having voted for the CDU at the 2009 election. Another 15 percent previously voted SPD, while 14 percent chose the business-friendly Free Democrats. 15 percent refrained from voting altogether at the previous election.
Were the anti-euro party to win seats in parliament, it could decrease Merkel's chances of forming another coalition with the Free Democrats. This could, in turn, increase the chances of a grand coalition between Merkel's conservatives and the center-left Social Democrats.
Though political commentators argue that the AfD seems to be gaining traction, some warn that Forsa's poll may be nothing more than a temporary fluctuation. "The standard margin of error is about two percentage points," says Andrea Wolf of Forschungsgruppe Wahlen, which conducts election polls for public broadcasting company ZDF. "This means that the strength of smaller parties like the AfD is often misrepresented."
09/04/2013 10:16 PM
Painful Past: German President Visits Nazi Massacre Site
By Florian Gathmann in Oradour-sur-Glane, France
President Joachim Gauck on Wednesday became the first German head of state to visit the French village of Oradour-sur-Glane, the site of a gruesome massacre by the Waffen SS in 1944. It was an emotional visit with heavy significance for French-German relations.
German President Joachim Gauck stands speechless at the place where the central market of Oradour-sur-Glane once stood. He is surrounded by ruins. Since the massacre perpetrated by the Waffen SS on June 10, 1944, Oradour no longer exists. Robert Hébras, one of only six survivors of the massacre, wants Gauck to tell him why. Why did the German soldiers destroy this village?
But the sprightly, white-haired man has no answer. "They just did," he replies. Oradour was not a hub of the Resistance; even the delusional retribution logic of the SS cannot explain the barbarity. Hébras is left to wonder why he and those five others survived that day -- when 642 others lost their lives.
Joachim Gauck has come to Oradour on this beautiful late summer's day to apologize for the nightmare of 59 years ago. The sun is shining, not a cloud in the sky, as Gauck, together with Hébras and French President François Hollande, visit the remnants of the horror. Then-President Charles de Gaulle decreed after the war that the ruins of Oradour should be preserved as a perpetual reminder of what took place.
A Dreadful Retelling
On that June day in 1944, the men of an SS Panzer Division called "Das Reich" ordered the inhabitants of Oradour to assemble in the village square and then moved them to several locations. Women and children were placed in the church. Hébras was taken to a barn. Hardly anyone in the village, he says, had an inkling of what was to follow. "I was talking with my friends about our football team's upcoming game," he says.
A few hours later his friends were dead, killed by machine gun fire or the huge blaze that the Germans spread throughout the village.
As Hébras recalls the horrific events to Gauck and Hollande, his tone is conversational, like that of a tour guide. That's probably because he's been telling the story for decades. As he leads the way through the ruins, he explains that because he was standing at the back of the barn, he was protected by the bodies of others and eventually was just barely able to escape the flames.
A Symbolic Site
In France, everyone knows Oradour. The annihilation of the village is one of those historical events that remains in the collective memory of a nation -- and that, in this case, influences perceptions of the country's German neighbors. So it should come as no surprise that you can meet visitors in Oradour today, older men and women, whose views of Germany are indelibly marked by this terrible event. But Oradour is not a simple topic within France even to this day, because some of the SS men who carried out the murders were from Alsace.
Gauck is the first German head of state to visit Oradour. It took almost six decades until a serving senior dignitary visited this site of German shame -- despite Franco-German friendship, which celebrated its 50th anniversary earlier this year. Despite the many city partnerships, the countless student exchange programs.
The wound of Oradour is still deep in France. And probably it took a president from neighboring Germany with a background like that of Joachim Gauck -- a former pastor who is a staunch champion of democracy and was an anti-Communist activist in his native former East Germany -- to finally visit the site. When Gauck makes statements like, "as Germany's president I suspect, and as a human being I feel, just what this decision means for France and the French people," it doesn't just sound like empathy -- he seems to really mean it.
Yes, the former pastor is sentimental. But sentimentality is required from any German president who dares go to Oradour.
'A Different Germany'
Robert Hébras leads the two heads of state through the Oradour cemetery and to the local memorial. Here they meet members of survivor associations and add their names to the memorial's guest book. Softly weeping, Gauck writes the following: "With horror, shock and disgust, I stand before that which was done under German command. I accepted the invitation humbly and gratefully. I can testify today that there is a different, peaceful and united Germany. So should it remain. Joachim Gauck."
Then he stands, hesitating, and finally puts his arms around Hollande's shoulders. They stay this way for a long moment. Shortly afterward the two leaders, together with survivor Hébras, come together in a three-way embrace.
It is a remarkable image -- for the French president as well. Sources at the Elysée Palace say that Gauck's visit to Oradour is viewed in line with the historic meeting between de Gaulle and then-Chancellor Konrad Adenauer in Reims in 1962 and the meeting between heads of state François Mitterrand and Helmut Kohl in Verdun in 1984.
Whether Gauck is thinking in such terms on this day is unknown. What's clear is that here stands a president who has truly taken this visit to heart. And one who is grateful for the opportunity -- grateful that he is able to represent a different Germany. "But through serious confrontation with this bitter history, the people in Germany have gained the strength to make my homeland a good nation," he says during his speech at the close of his visit.
On this day, Gauck is also a proud president.
09/04/2013 05:18 PM
The Domino Defect: Five Years After Crisis, Banks No Better Off
By Martin Hesse
The collapse of Lehman Brothers shook the global financial system to its core five years ago. Nevertheless, lawmakers continue to shy away from making the necessary reforms.
Andreas Dombret has to laugh out loud when he recalls the weekend preceding what some thought would be the end of the world as we know it. It was the weekend before Sept. 15, 2008, and Dombret was the head of Bank of America's German operations at the time. On Friday, Sept. 12, he learned from CEO Ken Lewis that the bank planned to negotiate the takeover of investment bank Lehman Brothers that weekend, and that all top executives were to make the necessary preparations.
Dombret spent that Saturday digging through Lehman files. On Sunday, he received another call from the United States, informing him that Bank of America was not going to acquire Lehman, after all, but another US investment bank, Merrill Lynch, instead. Dombret felt that Merrill was a better fit, but he also sensed that Lehman was about to drag his industry and the rest of the world to the brink of ruin on the very next day.
Lehman declared bankruptcy on Monday. On Tuesday, it was clear that the shock waves from the Lehman collapse were going to affect everyone, including Dombret's Bank of America and Merrill Lynch, which required billions in bailout funds from the US government. In Germany, Hypo Real Estate (HRE) and Commerzbank were also caught up in the turmoil, and throughout Europe entire governments sought to avert the impending meltdown of the financial system by nationalizing banks.
Dombret survived the dramatic events following the Lehman bankruptcy. Today, as a member of the executive board of the Bundesbank, Germany's central bank, he is in charge of financial stability, which makes him one of the country's most important opponents of excesses in the banking industry. When asked whether he believes that the industry and lawmakers learned the right lessons from that tumultuous weekend in September 2008, he concludes soberly: "We would hardly be more effectively protected against a chain reaction today than we were five years ago."
Dombret is critical of the system, saying that many rules and regulations need to be implemented more quickly and written into law. "Lawmakers seem to forget how deeply Lehman and the ensuing turmoil shook confidence in the market economy," he says. That was different a few years ago.
Between 2009 and 2011, the governments of the 20 leading industrialized and emerging economies (the G-20) agreed at several summit meetings that fundamental reforms were needed. They were determined that banks should never again be in a position to blackmail entire countries, because they were too big and too closely intertwined with the rest of the financial world to be allowed to fail. That was the consensus reached by world leaders, from German Chancellor Angela Merkel to US President Barack Obama.
The G-20 resolutions were followed by many attempts to tame what former German President Horst Köhler once called the "monster" of the financial markets. But the results remained tenuous.
While it is certainly true that bank bailouts no longer have to be ironed out in hectic, nighttime crisis meetings, it is also true that large banks, especially in the United States, are raking in billions once again. But the new sheen is deceptive, because banks owe much of their comeback to ongoing support from governments and central banks. Instead of having to launch bailout operations worth billions, they have simply turned to a policy of slowly feeding the financial industry with cheap money.
"In the euro zone, many banks would have trouble refinancing themselves without the help of the European Central Bank (ECB)," says Christoph Kaserer, a financial expert at the Technical University of Munich. According to Kaserer, a number of institutions are not sufficiently profitable to survive on their own in the long term. The euro-zone countries, fearing the potentially uncontrollable consequences of liquidating ailing financial groups, have helped create so-called zombie banks.
European banks are still burdened with massive bad loans left over from the financial crisis -- amounting to €136 billion ($180 billion) at Germany's Commerzbank alone. Analysts with the Royal Bank of Scotland estimate that the banks need to shed about €3.2 trillion in assets in the next three to five years, while at the same time generating €47 billion in fresh capital to be considered stable. If one of these shaky financial giants were to fall, it would likely spell the end of the banking sector's tentative recovery. "Although the domino effect of a large bank failure would occur more slowly than five years ago," says Munich economist Kaserer, "the consequences would still be so serious that a government would bail out an institution like Commerzbank again."
Losing Sight of the Objective
In the last five years, there have in fact been a significant number of new guidelines, laws, drafts and recommendations. The banks were forced to increase the size of their financial cushions, for example, but they still aren't large enough. Regulators devised split banking systems designed to shield customer deposits from risky trading activities, but the concepts are half-baked and have yet to be fully implemented.
The leading industrialized nations agree that banks should be liquidated in accordance with clear rules -- and without adversely affecting taxpayers, if at all possible. Nevertheless, there are still no uniform international principles to achieve this goal. Most countries don't even have an insolvency statute for the industry.
Bankers' bonuses were capped, but then their fixed salaries were increased dramatically. Regulators had vowed to rein in the rampant trade in derivatives among banks by requiring it to be conducted on supervised exchanges. Instead, the over-the-counter derivatives market has grown by 20 percent since 2009.
Over the years, lawmakers have lost sight of the most important objectives of regulation. Secure savings deposits, a continuous supply of credit and a functioning payment transaction system are as important to an economy as intact water pipes or power grids. The point is to ensure that this supply functions properly. At the same time, governments and taxpayers cannot allow themselves to be held hostage by the banks, merely because they can guarantee a basic supply of capital.
"What is needed is fundamental structural change, which, as in other industries, costs money. Lawmakers shy away from that," says Clemens Fuest, President of the Center for European Economic Research (ZEW).
Financial industry executives take every opportunity to warn that if regulators take aim at financial groups, then businesses, savers and investors will ultimately suffer. Take, for example, Anshu Jain. In the early summer, the co-CEO of Deutsche Bank gave a talk to students at Frankfurt's Goethe University. He always takes the same approach at such appearances. He touts the advantages of the universal bank, which, like his company, offers all financial services, from savings accounts to derivative trading. Then he admits that mistakes were made and highlights the need for reforms. At the same time, Jain sends out a warning to lawmakers not to overdo it with new legislation. "If all measures are implemented as planned, it could spell the end of 100 years of universal banking in Europe," Jain said in Frankfurt. His message seems to strike a chord.
Who Bears the Losses?
Capital rules are a case in point. "Contrary to their political rhetoric, Germany, France and even Japan have blocked the acceptance of tougher requirements in international negotiations," says financial expert Harald Hau of the University of Geneva. Their goal, he adds, is to avoid putting their own, undercapitalized banks under pressure.
At the time of the Lehman bankruptcy, many large banks maintained an equity cushion of only 2 percent of their total assets. The remaining 98 percent was borrowed capital. As a result, even small losses could lead to bankruptcy. Today, this cushion amounts to about 3 percent at many banks. "It's still far too little," says Hau, who believes that an equity cushion of 15 to 20 percent is ideal.
Regulators' notions are still well removed from such quotas. Meanwhile, they are fine-tuning complicated regulations that would require banks to maintain larger capital reserves for riskier transactions, and smaller reserves for those that are supposedly safer. This sounds reasonable, but the amount of risk associated with a deal often only becomes apparent in retrospect.
For instance, there are still no capital reserve requirements for many government bonds today, even though hardly anything threatens the existence of banks as much as the sovereign debt crisis. But who else would finance the excessive borrowing of governments?
Part of the job of banks is to assume a portion of the risks of companies, governments and citizens. Banks cannot fully safeguard themselves against financial risks and operate profitably at the same time. But that's why bankruptcies are also necessary, just as in any other industry. Regulation is needed to determine who, in addition to the owners, bears the risk of losses.
Since the Lehman bankruptcy, the creditors of financial institutions have been largely spared. The banks' creditors were often other banks. This leads to chain reactions, like the one that occurred after the Lehman bankruptcy, which can be deadly for the entire system.
Neglecting the Central Problem
"So far, this central problem has been neglected in the reform plans," says Jan-Pieter Krahnen of Frankfurt's Goethe University. Krahnen argues that banks should be required to obtain a certain portion of their debt from non-banks. Insurance companies and pension funds, for example, would be better able to absorb losses, because they derive their revenues from customer funds committed for the longer term. But they argue that bank failures would then affect their customers, putting the pension plans of many people at risk.
In the end, citizens are always left bearing a portion of the risks associated with a good supply of banking services, be it through taxes or losses in their private pension plans. But these risks should be transparent and no larger than necessary. High-risk transactions, such as trading in securities, are not among the risks that broad segments of society should bear. For this reason banks are to be organized in the future so that their consumer services -- deposits, loans and payment transactions -- are largely separated from trading activities and can be spun off at any time.
However, Munich banking expert Kaserer questions whether the solutions devised in Europe and the United States to date will work. "The German banking separation law does nothing to stabilize the system," he says, "because the parent company is ultimately liable for all parts of the bank." It is unclear whether lawmakers will be able to create an effective separated banking system.
However, the banks' escalating trading activities could certainly be made more secure. "The more the trade in derivatives shifts to transparent and regulated exchanges, the more manageable the risks become," says University of Geneva financial expert Hau. But there is still considerable resistance to new rules. "The lack of market transparency is intentional on the part of the major banks, because that's the basis of their information advantage and the profitability of their trading activities," says Hau.
The bigger and less transparent the banks, the more reliable their guarantee that the government will bail them out if necessary. "The banks know that if they're complex enough, they'll be bailed out," says ZEW President Fuest.
Translated from the German by Christopher Sultan
September 5, 2013
16 Skulls Found on Streets in Prague
By THE ASSOCIATED PRESS
PRAGUE — Police in Prague say 15 human skulls have been found in a wooden box found on a street, and another was found in a garbage bin.
Spokeswoman Jana Roesslerova says police found the 15 skulls Thursday morning near a garbage container after they were alerted by a telephone caller. Roesslerova says each skull was numbered.
She says another skull, also bearing a number, was found in a garbage bin Wednesday by a homeless person.
Police say it is not clear whether the two cases are connected. They have asked experts to help in their investigation.
Iranian president tweets Rosh Hashanah blessing to Jews
Hassan Rouhani's message to mark start of Jewish new year unexpected in Israel, which has identified Iran as security threat
Harriet Sherwood in Jerusalem
theguardian.com, Thursday 5 September 2013 10.14 BST
Amid a global exchange of greetings and good wishes to mark Rosh Hashanah, the Jewish new year, which began at sunset on Wednesday, there was one from a particularly surprising quarter.
The Iranian president, Hassan Rouhani, tweeted: "As the sun is about to set here in #Tehran I wish all Jews, especially Iranian Jews, a blessed Rosh Hashanah."
The tweet was accompanied by a picture of an Iranian Jew praying at a synagogue in Tehran.
According to a 2012 census, there are fewer than 9,000 Jews among Iran's population of about 75 million.
The message from Rouhani was unexpected in Israel, which has identified Iran as a huge threat to its security. It says the regime is developing a nuclear weapons programme that could be used to annihilate the Jewish state.
Rouhani, who was elected in June, has pledged to tone down the "hate rhetoric" used by his predecessor, Mahmoud Ahmadinejad.
The US president, Barack Obama, also sent new year greetings to Jews around the world, wishing them "shana tova" from the Great Synagogue in Stockholm during a stopover en route to the G20 summit in Moscow.
Other wellwishers included the British prime minister, David Cameron, who sent "best wishes to Jewish communities in the UK and around the world observing the High Holy Days of Rosh Hashanah and Yom Kippur".
His message continued: "At this important time for the Jewish faith let us join you in praying for a new year that will achieve progress towards a lasting peace for Israel and the Middle East."
Rosh Hashanah marks the start of the year 5774 in the Jewish calendar and about a month of religious holidays. Yom Kippur, the solemn day of atonement and fasting for Jews, begins at sunset next Friday. It is followed by Sukkot, or the Feast of the Tabernacles, an eight-day holiday in which observant Jews take meals in a sukkah, an outdoor structure traditionally covered in palm fronds.
Afghanistan security forces' readiness for Nato withdrawal still a hard sell
Army and police have their strengths but concerns about their weaknesses drive script that they are prepared and capable
Emma Graham-Harrison in Kabul
theguardian.com, Wednesday 4 September 2013 16.55 BST
After more than a decade of fighting, Nato combat forces will all be gone from Afghanistan by the end of 2014, leaving the country's soldiers and police to fight the battle-hardened Taliban alone.
A small foreign contingent may remain in a few bases around the country, but on a non-combat mission, with a mandate only to train Afghan forces.
Commanders and politicians have been keen to emphasise that the Afghans will be able to take on a insurgent force that battled Nato to a stalemate, and in June marked the official handover of security control for the whole country to the army and police.
"I believe the Afghans are, in fact, ready to take the lead right now," General Joseph Dunford, the top US and Nato commander in Afghanistan, said a few hours after the ceremony.
But minutes later he admitted they still lacked air capacity, were badly integrated and needed more heavy weapons and bomb detection and disposal skills.
The Afghan army and police are riddled with problems from drug abuse to soaring casualties and annual dropout rate in its tens of thousands. Nato commanders admit that Afghan forces also struggle to gather intelligence and do their own basic logistics.
But the timeline for the withdrawal was fixed years ago, and as the army and police must take over – ready or not – there is a strong military and political imperative to present them as prepared and capable.
A 2014 end to the foreign mission in Afghanistan was first mooted by President Hamid Karzai in 2009, and endorsed at a Nato conference in Lisbon the following year by governments weary of a war that showed no signs of winding down despite a heavy toll in lives and funds.
But after thousands of deaths, and billions of dollars spent, there were few politicians willing to admit that they were leaving the war because they and their constituents no longer had the appetite to fight it rather than because the conflict had ended. In Kabul there are constant worries about the impact on morale if troops and civilians feel abandoned by their former backers.
And so a security handover driven by a political imperative is being presented, in part, as a response to the improving capacity of the Afghan security forces.
The political theatre reached a peak earlier this year at the 18 June ceremony to mark "milestone 13", the handover of security control. Karzai and Barack Obama had agreed it would happen before the summer, so officials chose almost the last day of spring for the ceremony.
Security was so tight that diplomats and journalists were flown across the city in helicopters, to hear speeches about how effective the army and police were at protecting the country. Western military officials were ordered into civilian clothes or dress uniform, so the television images showed Afghan viewers familiar only with combat fatigues a crowd that appeared to already have been stripped of foreign military.
Politicians hailed the completion of a security transfer that Dunford later admitted was still very much underway in the most dangerous parts of the country. The handover has been a rolling process and the final areas chosen for the final – "tranche five" –stage, which make up about a quarter of Afghanistan's 398 districts, had not yet been transferred.
"At the national level, primary responsibility for security is with the ministry of defence and ministry of interior, and I am in support. In some of the tranche five areas, we still have security responsibility as a result of not completing the process," Dunford told a news conference at coalition headquarters in Kabul.
That is not to say there have been improvements, particularly since Nato began focusing seriously on training in 2009, and the long, slow security transfer began in 2011. The police and army, now 350,000strong, are almost unrecognisable from the small, fragmented forces of several years ago.
Some areas are particularly strong. Afghans are brave, even when ill-equipped, and special forces have an impressive record despite the recent departure of a police general who commanded many of them.
But that does not mean they are ready to fight alone. Dunford told the Guardian in a recent interview that they may need help until as late as 2018.
With the west set on taking home all but a few troops, and the Taliban equally set on continuing the fight, both Kabul and Nato have little choice but to focus on convincing the people of Afghanistan and voters back home that Afghan forces are ready to continue the fight.
September 4, 2013
Falling Economic Tide in India Is Exposing Its Chronic Troubles
By KEITH BRADSHER
MUMBAI — India had seemed tantalizingly close to embarking on the same dash for economic growth that has lifted hundreds of millions of people out of poverty in China and across East Asia.
Its economy now stands in disarray, with the prospect of worse to come in the next few months.
Vinod Vanigota, a Mumbai wholesaler of imported computer hard drives, said sales dropped by a quarter in the last two weeks. The rupee, India’s currency, has been so volatile in recent days that he began revising his price lists every half-hour.
Business activity at Chip Com Traders, where he is the managing director and co-owner, has slowed so sharply that trucking companies plead for business. “One of the companies called today and said, ‘Don’t you have a parcel of any sort for us to deliver today?’ ” Mr. Vanigota said.
The economic decline has laid bare chronic problems, little remarked upon during the recent boom. An antiquated infrastructure, a sclerotic job market, exorbitant real estate costs and bloated state-owned enterprises never allowed manufacturing, especially manufacturing for export, to grow strong.
The rupee fell further and faster in August against the dollar than any of the world’s 77 other internationally traded currencies as investors in affluent countries took their money home for higher returns. It was down 20 percent since May, a period in which the stock market followed suit and fell almost 8 percent.
The real estate market is teetering after soaring to vertiginous heights over the last few years. Cranes on Mumbai’s skyline perch nearly immobilized as developers struggle for cash.
The things the emerging middle class coveted, Chevrolets, iPhones and foreign vacations, have all jumped sharply in price in recent weeks.
The price increases threaten to worsen consumer price inflation — already among the highest in Asia at an annual rate of almost 10 percent — and widen the country’s already large international trade deficit and government budget deficit.
India’s government is now bracing the country for a swift increase in the price of diesel fuel and other imported necessities priced in dollars. Diesel is the lifeblood of the Indian economy, from the trucks that crawl along the country’s jammed, potholed roads to the backyard generators that struggle to compensate for the high-cost yet unreliable electricity grid.
Some economists say that they hope India will have only a V-shaped economic downturn, with a rebound starting by early next year if a weak rupee rejuvenates India’s struggling exporters.
“India is not Greece — we never binged on debt on a grand scale,” said Ajay Shah, a prominent economist at the National Institute of Public Finance and Policy in New Delhi.
The root of the problem is India’s failure to create a vibrant industrial base with the strength to export. As Western buyers scour Asia for alternatives to increasingly expensive Chinese factories, India and its enfeebled manufacturing sector are mostly ignored.
Soeb Z. Bandukwala, a managing director of Ansons Electro Mechanical Works, a maker of water pumps and electric motors, wonders how a recovery can arrive, given India’s structural problems. He runs a business that has been in his family since 1967 and has grown to four factories.
Yet he keeps each factory at fewer than 50 workers and has maintained some metal grinding machines and other equipment in use since the 1970s without replacement. His worry is that if he exceeds 50 workers or surpasses certain benchmarks for total investment, he will become subject to extensive labor legislation.
“There is a fear, and the fear is the labor laws,” said Mr. Bandukwala, who is also a regional leader in the Confederation of Indian Industry.
Infrastructure is also a problem. Ansons is only 35 miles from the port through which it exports machinery to Europe. Yet trucks require four to seven hours to reach the port because promised expressways have never been built.
Speeds barely faster than walking at least help protect pumps and motors from harm. “If the speed is greater, damage will take place because of the potholes,” Mr. Bandukwala said.
Poor infrastructure has also driven up costs for industrial real estate in India, which are high compared with China’s. Just in the last five years, China has opened 5,800 miles of high-speed rail routes and 400,000 miles of highways of two or more lanes. That has allowed tens of thousands of factories to move to smaller towns in the interior with much lower land costs.
India has been unable to open up its interior the same way, building half as many miles of highways over the same period and no high-speed rail routes. At the same time, rent control and other land regulations make it extremely difficult to tear down and replace even the most dilapidated buildings.
So cities like Mumbai have ended up with dozens of square miles of mold-stained, low-rise buildings with spots of bright green fungus, interspersed by the occasional skyscrapers that were somehow built. Remote, outer fringes of factories and office buildings have sprouted on what was once farmland.
The acute shortage of real estate less than a day’s drive from ports has produced steep real estate prices and rents. Challenge Overseas, a trousers manufacturer, paid $1.3 million five years ago to buy the 20,000-square-foot top floor of a decrepit, four-story factory building with blocked fire escapes on a muddy alley on the outskirts of Mumbai, and sold it for $2.7 million last month. The floor underneath, the company’s 60-employee factory, sold for $410,000 in 2003 and is now valued at $1.2 million.
Roads and bridges to inland towns are not the only infrastructure problem. Shakti Industries, which thins and cuts aluminum wires for jewelry manufacturers, pays the equivalent of 15 to 18 cents per kilowatt-hour for electricity. In China, even after a round of price increases coming in late September to pay for more clean energy, factory owners will pay half as much.
Shakti has only seven employees. Yet it is regulated by more than a dozen government agencies, each of which sends a separate inspector each year before issuing licenses for things as diverse as electricity use and water pollution. Many of the inspectors demand bribes, said Vipul S. Kamani, the managing director of Shakti.
High real estate and electricity costs leave businesses with very little money to pay workers and remain competitive in the global markets for garments and other manufactured goods.
Arun Prajapati, 21, a migrant worker at a fabric fusing machine at Challenge, said that he earned about $100 a month, just a fifth of what Chinese workers earn these days.
He pays $9 a month for rent and electricity for his sleeping space on the floor of a 10-foot-by-10-foot room that he shares with five other migrant workers in a nearby shanty. He spends $38 a month for a subsistence diet of roti bread, lentils and, once a week, some chicken or eggs. He sends his meager savings to his widowed mother in their home village in central India.
“With expenses rising each month, things are only getting harder and harder,” he said. “I am just trying to get through life.”
One private sector industrial giant that bet heavily on an economic takeoff in India is the Essar Group, based in Mumbai. In the last five years it has invested nearly $18 billion to build one of the world’s largest refineries and one of the world’s biggest steel mills in northwestern India while tripling capacity at its ports and quadrupling the output of its power plants.
But the company now plans to collect income from these projects instead of building more, and it is even selling three steel-related businesses to pay down debt.
Haseeb A. Drabu, a former government economic planner and bank chairman who is now Essar’s chief economic adviser, said that at Essar and across India, “I don’t see any fresh wave of investment.”
Neha Thirani Bagri contributed reporting.
India holyman castrates himself in apparent protest over his guru’s arrest on rape charges
By Agence France-Presse
Thursday, September 5, 2013 9:49 EDT
An Indian holyman castrated himself in an apparent protest against the arrest of a popular spiritual leader on sex charges, police said Thursday.
Baba Premdas, 60, was found bleeding late Wednesday in northern Uttar Pradesh state after severing his genitals in what reports said was a protest at last week’s arrest of Asaram Bapu, a self-styled Hindu holyman.
“Why he did it is not clear. Some say it was because of Bapu’s arrest, some say it was because he feared ending up in Bapu’s situation. No one knows,” said Alankrita Singh, chief of police of the city of Amethi.
Premdas has been transferred to hospital for plastic surgery and is in a stable condition, Amethi police official Mahendra Singh told AFP.
Police said the wounds appeared to be self-inflicted, but they planned to question Premdas.
Since Bapu’s arrest over accusations the 72-year-old sexually assaulted a 16-year-old girl at a religious retreat, hundreds of his supporters have protested outside a jail where he is being held and blocked railway lines.
Bapu has dismissed the case against him as a political conspiracy.
For many Indians, self-styled holymen play an integral role in daily life, offering them a pathway to enlightenment in return for spiritual devotion and often hefty donations to their retreats and temples.
September 4, 2013
South Korean Lawmakers Back Arrest of Colleague in Treason Case
By CHOE SANG-HUN
SEOUL, South Korea — The South Korean National Assembly on Wednesday voted to allow the arrest of an opposition lawmaker on charges of plotting treason in a case that rekindled fears of a pro-North Korean rebellion and concern about the actions of a powerful intelligence agency that has been long accused of meddling in domestic politics under the pretext of hunting Communists.
The lawmaker, Lee Seok-ki, a member of the minor United Progressive Party, is accused of gathering 130 followers, some of them drunk and with small children, in two secret late-night meetings in May to plot an armed rebellion in support of the North in case of war. North Korea heightened military tensions earlier this year by declaring that it would no longer honor the 60-year-old cease-fire that halted the Korean War in 1953.
In one of the meetings, which lasted till 2 a.m. on May 13 at a religious retreat in the South Korean capital, Seoul, Mr. Lee, 51, said war could be imminent on the divided Korean Peninsula and his followers should prepare themselves for a “revolution” against “the world’s most powerful American imperialists” and achieve “a new reunified fatherland,” according to the National Intelligence Service’s charges against him.
At one point, he said the manual for making the pressure cooker bomb used in the Boston Marathon attack was available on the Internet. According to the charges, one of Mr. Lee’s followers reminded the others that during the Korean War, the South Korean authorities arrested and executed tens of thousands of leftists out of fears that they would collaborate with the North Korean Army. The man, Hong Soon-seok, was quoted as saying that if there were another war, a similar fate could befall South Korean leftists, “as Jews were once rounded up.”
Another follower, Lee Sang-ho, suggested attacking South Korea’s communications, oil, train and other crucial facilities in case of war, the charges said. But Mr. Hong also called the idea of buying sniper rifles and using hacking skills to attack military radar facilities “outlandish.”
Mr. Lee and his followers also face separate charges of violating South Korea’s anti-Communist national security law when they sang North Korea’s “revolutionary” propaganda songs during four political gatherings last year. Mr. Hong and Lee Sang-ho were arrested last week.
“Lee Seok-ki is an enemy of South Korea,” said Kim Jin-tae, a lawmaker from the governing Saenuri Party, calling on fellow legislators to support a bill authorizing the arrest of Mr. Lee on Wednesday.
By law, a legislator can be arrested with parliamentary approval when the National Assembly is in session.
“This is a medieval witch hunt,” Mr. Lee told the Assembly, denying hatching a plot to overthrow the South Korean government through an armed rebellion and accusing the intelligence agency of “mobilizing conservative news media” to discredit him and his party.
In an earlier news conference, he called himself a pacifist and urged his fellow lawmakers to reject the bill, quoting a phrase often attributed to the 18th-century French philosopher Voltaire: “I disagree with what you say, but I will defend to the death your right to say it.”
Lee Jung-hee, the head of Mr. Lee’s progressive party, said the intelligence agency cited excerpts and distorted the context of the comments made during the May meeting to support its treason charges. The talks of sabotaging state facilities were “like jokes and were laughed away,” she said.
“If this is treason, we are living in a society no one can dare crack a joke,” she said. “You cannot punish someone for what he thinks.”
But Mr. Lee found few friends in the Assembly, and the bill was passed by a vote of 258 to 14, as the main opposition Democratic Party also decided to approve it, although it warned the national intelligence agency against McCarthyism, in a reference to the American senator who pursued suspected Communists in the 1950s. Later Wednesday, intelligence agents took him to a court hearing, where a judge was to decide whether to formally arrest him.
Mr. Lee is the first lawmaker to face treason charges since democratically elected leaders replaced the country’s past military dictators, who often used treason charges to silence and even execute dissidents, later exonerated in retrials.
Mr. Lee’s case — and the timing of the National Intelligence Service’s raid against the homes and offices of Mr. Lee and his followers last week — have rocked the country for days, setting off charges from the opposition that the spy agency is resorting to its old trick of concocting espionage cases and threats from North Korea to divert attention from domestic political crises and calls to curtail its power.
The case comes amid heightened concern over the actions of South Korea’s intelligence apparatus. Won Sei-hoon, a former head of the spy agency, now stands trial on charges of ordering a team of agents to begin an online smear campaign last year against government critics, including presidential candidates who ran against Park Geun-hye, who was then the governing-party candidate and is now the president, in December.
Opposition lawmakers said the powerful spy agency’s alleged interference in the election was a bigger threat to democracy than the plot Mr. Lee’s small group is accused of.
Although many South Koreans criticized and ridiculed Mr. Lee, calling for his punishment, others raised questions about what constitutes a treason plot and how freely people can talk about North Korea in the South, where the government blocks access to North Korean Web sites and people are still arrested for resending Twitter posts of North Korean propaganda materials.
Chin Jung-kwon, a political commentator whose Twitter account has more than 360,000 followers, compared Mr. Lee and his followers to “inmates in a madhouse” and “Don Quixotes arming themselves.”
Kim Young-hwan, a member of the main opposition Democratic Party, called the treason charge against Mr. Lee “a third-rate comedy.”
“Who in South Korea will be influenced by the anachronistic rhetoric of the United Progressive Party?” Mr. Kim said.
Mr. Lee and many members of his party are former student activists accused of subscribing to North Korea’s ideology of juche, or self-reliance. They criticize South Korea’s military alliance with the United States as well as the American military presence in their country. Their conservative enemies accuse them of stressing cooperation with North Korea while ignoring the North’s human rights violations and nuclear and military threats.
Critics say Mr. Lee and the National Intelligence Service actually need each other, with the agency’s scandal bolstering the ability of progressive politicians like Mr. Lee to stoke antigovernment sentiments while the agency uses cases like Mr. Lee’s to defend itself from charges of meddling in domestic politics.
“Lee Seok-ki and his like are nothing but a delusional religious cult,” Kim Ky-baek, publisher of the nationalist Web site Minjokcorea, said in an interview. Mr. Kim sued Mr. Lee and his progressive colleagues last year on charges of treason. “But the corruption of the conservative establishment that has been in power in South Korea for the past five decades, and the people’s disillusionment with it, gave room for the North Korea followers like Lee.”
This article has been revised to reflect the following correction:
Correction: September 4, 2013
An earlier version of this article misidentified the century in which the French philosopher Voltaire lived. It was the 18th century, not the 19th. The earlier version also misstated the surname of one of the leftists arrested last week, and misattributed a comment from one of those arrested. The man arrested last week was Hong — not Han — Soon-seok. It was Mr. Hong — not Lee Sang-ho, a fellow leftist — who called the idea of hacking military radar facilities and attacking them with rifles “outlandish,” according to the charges against him.
North Korea agrees to reopen military hotline with South
Pyongyang had shut down telephone and fax lines used to co-ordinate cross-border travel to joint industrial park in March
Associated Press in Seoul
theguardian.com, Thursday 5 September 2013 13.50 BST
North Korea has agreed to restore a cross-border military hotline with South Korea, in another sign of easing tensions between the rival states.
In March Pyongyang shut down the telephone and fax lines used to co-ordinate cross-border travel to a joint industrial park in Kaesong that has since been closed. During the spring North Korea issued a series of threats including vows to launch nuclear strikes on Seoul and Washington, but later softened its rhetoric and made conciliatory gestures.
On Thursday North and South Korea agreed at a meeting in Kaesong to reopen the hotline on Friday, Seoul's unification ministry said.
Last month the two states agreed to work towards reopening the industrial complex, that had been the last symbol of reconciliation between the countries before North Korea suspended its operations in April.
In June the countries restored another communications channel at a border village.