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As Power Flows to Regional Bosses, Questions Rise on India\'s Economy

NEW DELHI - It seems like eons ago, but Prime Minister and his coalition government once inspired very high expectations. They were going to stoke 's economy, improve education, help the poor, build modern transportation and energy systems and, perhaps most improbably, prove that India, the most populous and messiest of democracies, could be successfully governed.

That was in 2009, when the governing coalition, led by the Indian National Congress Party, won an unexpectedly broad re-election victory. India's economy was motoring out of the global recession, and the country seemed to be moving from an era of fragmented politics to a new stage in which power resided with a stronger central government in New Delhi. To those who saw India as a rising global power, this was good news.

If only.

Today, India's political calculus is again in flux. The economy is in a tailspin, Mr. Singh and his government are desperately trying to regain credibility, and power is now radiating to regional political chieftains, who are teasingly considering a new national political alignment, a so-called third front to compete with the two national powers, the Congress Party and the opposition Bharatiya Janata Party.

Regional bosses, once in decline, are becoming kingmakers again: the squat, sleepy-eyed Mulayam Singh Yadav, who oversees the powerful Samajwadi Party, is even publicly musing about himself as a future prime minister.

“The incentive for every single party from the opposition to the allies is to send a signal that the Congress can't govern,” said Pratap Bhanu Mehta, president of the Center for Policy Research in New Delhi. “That's the election plank.”

Had Mr. Singh's government met initial expectations, or even come close, the political landscape would undoubtedly be different. “They just blew it,” Mr. Mehta said. The rise of Mr. Yadav and several other regional bosses has many implications for Indian politics, but the trend also raises a broader question about the changing arc of the Indian economic story: If the old assumption was that India needed a strong central government to compete globally, and to avoid a competitive disadvantage with China, what will happen now that the opposite seems to be happening?

History does not provide much reassurance. In past decades, third-front governments have twice taken power and have twice collapsed because of internal bickering, a prospect of instability certain to be unappealing to those in New Delhi and Washington who are eager for India to become a stable and influential player in Asia. Most analysts are skeptical that a true third front will take power in the near future, but they agree that the clout of regional leaders is growing.

“Indian politics will have to live with bargains and negotiations with regional parties,” Ashutosh Varshney, a political expert, said in an e-mail interview. “A third front may or may not emerge, but both national parties will have to negotiate and bargain. That also means that India will find it harder to make firm assertions of power on the international stage, à la China. Its power will grow, but more gradually.”

Last week, Mr. Singh's coalition government nearly collapsed after he pushed through unpopular economic measures, including an increase in diesel fuel prices and a policy shift enabling global giants like Walmart to open retail stores here. Mamata Banerjee, the populist chief minister of the state of West Bengal, declared the moves “anti-poor” and withdrew her regional party from the governing coalition, potentially bringing down Mr. Singh's government. Until, that is, Mr. Yadav and another nonaligned regional leader, Mayawati, who uses only one name, stepped in to rescue the government, at least for now, by pledging “outside” support.

The machinations were hardly altruistic. For months, Mr. Yadav and other regional leaders have speculated - at times gleefully - about the possibility that the governing coalition might collapse, forcing early elections for Parliament, before the scheduled date in 2014. By allowing the government to survive, analysts say, the regional bosses made a cold calculation: keeping afloat a wounded central government was more advantageous, for now, than trying to pick up extra seats by forcing early elections.

The strategy is to pummel Mr. Singh's government like a piñata, if not yet knocking it completely to the ground, in hopes of inflicting even greater long-term damage to the Congress Party. Mr. Yadav, for example, is lending parliamentary support to the government, even as he plans to rally against Walmart and some economic measures.

India's economy has suffered in the lingering global downturn, but most analysts say India's current problems are disproportionately self-inflicted. The two-headed leadership structure of Mr. Singh and Sonia Gandhi, the Congress Party president, which worked earlier, is now seen as increasingly ineffective.



In Old Delhi, the Ancient Art of Kabootarbaazi (Pigeon Rearing) Lives On

By RAKSHA KUMAR

NEW DELHIâ€"One of the winding alleys of the Chitli Qabar neighborhood in Old Delhi leads to a four-story, narrow white house, where several cats hungrily ply the stairs almost constantly.

“We have to keep a strict vigil on these cats all the time,” says Mateel Qureshi. “They eye my pigeons.”

On the rooftop of the building live 700 pigeons in seven huge cages, one of the most diverse collections of the birds in Old Delhi, where the ancient art of kabootarbaazi, or pigeon rearing, is alive and well. Visitors will notice a distinct odor of pigeon droppings mixed with ittar, or perfume, but the perfume isn't for covering up the odor â€" it's an integral part of rearing pigeons in this part of Delhi.

Sohail Hashmi, a historian, said pigeon rearing began in the Mughal period because the rulers felt the need to communicate with their aristocracy on a regular basis and found that sending messages through pigeons was the best way to do so. Mughal emperors maintained the pigeon-rearing tradition in Old Delhi. “Almost every noble man had a kabootarkhana (home for pigeons) in his house,” said Mr. Hashmi.

Old Delhi held pigeon competitions in January and February during the Mughal period and some decades thereafter as well. Owners of flocks of pigeons traditionally spent all year training their birds, as these competitions were very prestigious and the winners highly respected. According to Mr. Hashmi, that hobby has been carried on by many generations.

Today, there is only the distance-flying competition, in which the pigeon that flies the longest distance and returns to its owner wins, a sort of marathon for pigeons. Ow ners of pigeons gather at a specified place and set their pigeons free. The birds take to the sky and follow a rehearsed route within Old Delhi. Several organizers are stationed at specific points, taking stock of how far each pigeon has flown and within what time. The first pigeon that completes the route and returns to its proud owner waiting at the starting point is the winner.

It is here that the perfume plays a role. Owners bathe their pigeons in scented water so that it is easy to differentiate one pigeon from another. Small bands are also placed on the thin legs of the pigeons, which help the owner identify his bird.

When Mr. Qureshi, 27, opens one of the cages on his rooftop, several pigeons fly out and go straight for the grains that are scattered on the floor. Then, like clockwork, they return to their cages when he blows a shrill whistle.

Mr. Qureshi's neighbors say he has the largest variety of pigeons in his collection among the estimated hundr eds of families that still rear them. He doesn't sell the birds, Mr. Qureshi said, because “they have been our family's passion for over a hundred years now.”

His grandfather started kabootarbaazi with only about 200 pigeons, he said, and his uncle took the numbers up to 1,200. But Mr. Qureshi said he can only handle the 700 he has now because he also owns a famous sweet shop, Shireen Bhawan. He spends a couple of hours with the birds each day after he returns home from work.

For the distance-flying competitions, pigeons are trained to recognize the owner's voice as the owner teaches the birds the route. As Mr. Qureshi and his brother would drive, they would whistle or call to the pigeons as the pigeons flew alongside. On quiet mornings, sometimes the owners would drop grain on the streets for the birds to follow.

Once a pigeon has gone over a route a few times, Mr. Qureshi said, it knows where to go and how to get there, although some pigeons are bette r than others at memorizing the route.

The pigeons are like any other pets, he said. If you train them to listen to you, that is enough.

It is 5:30 p.m. and Mr. Qureshi pulls away the delicate net that covers the two cages of the birds he considers well trained, about 150 out of his collection. “Fly, my babies,” he said. “It is time for you to touch the skies.” The birds cooed loudly as they emerged from their cages, filling the sky with their gray-and-white bodies.

“They are like any other pets,” he said smiling. “They need to get out for a while. I am sure they will all return.”



India\'s Sahara-Massive, Splashy ... And Mysterious

KHALILABAD, India (Reuters) - Like millions of Indians, Jag Ram Chaudhary invested with the Sahara conglomerate - 1,300 rupees ($24) a month in his case - to put away money for a rainy day.

"My wife had an accident some years back. I don't have much savings, so I thought I'll be able to save some money by putting in a small amount every month," said Chaudhary, an office helper at a construction company in Uttar Pradesh state.

On August 31, India's Supreme Court ruled that finance schemes run by two Sahara companies were illegal and ordered it to repay as much as $4.5 billion to up to almost 30 million mostly small investors, plus interest. The final figures are still to be determined as some clients have already redeemed their investments, lawyers on both sides of the matter said.

The case has shone a rare light on the unlisted giant whose interests range across finance, housing, media and entertainment

Sahara has accumulated a string of trophies in recent years, including a stake in a Formula One motor racing team and ownership of Grosvenor House hotel in London. In July, it agreed to buy a controlling stake in New York's Plaza Hotel.

But its core client base is the towns and villages away from the shiny cities of modern India. There, Sahara sells investment products to often poor people in amounts as small as 2 rupees (4 U.S. cents) a day. The company is a household name in India through its lead sponsorship of the national cricket team.

"Banks take eight years to pay what I get from Sahara in five years," Chaudhary, 40, said in Khalilabad, a town in Sant Kabir Nagar district in northern India. Like several Sahara customers interviewed nearly two weeks afterwards, he had not heard of the court ruling.

SPENDING POWER

Critics, including activist groups, say Sahara's investment products are designed to evade oversight by financial regulators and that it lacks transparency on the source and use of its funds, selling products to investors who do not understand the risks and plowing the proceeds into real estate projects.

Under the scheme rejected by the Supreme Court, two firms owned by Sahara had offered bonds to small investors, promising, in some cases, to return three times the face value after 10 years.

The court ruling that it raised money by "dubious" means follows another rebuke in 2008, when the central bank ordered a Sahara company to stop taking deposits from the public.

In a country where "black money", or undeclared wealth, is rampant, Sahara's size and spending power have long fuelled speculation over how the company operates.

Sahara, headed by Subrata Roy Sahara, its chairman and self-described "managing worker", says it helps small investors outside the banking system and that it has never defaulted on them.

"Sahara agents motivate people who would otherwise spend the money on liquor, gambling, etc," said Guddu Pandey, a school teacher and Sahara agent in Uttar Pradesh state, echoing an argument made by Sahara after the court verdict.

The company did not respond to several attempts by Reuters to get answers to written questions. Roy was not immediately available to be interviewed, Sahara said.

Sahara has not said how it will refund the money to investors, although it has said it is healthy and investors need not worry.

ALL IN THE FAMILY

The company's full name is Sahara India Pariwar, or family. Roy, 64, refers to himself as the guardian of the world's largest family, and espouses a philosophy of "collective materialism".

At its headquarters in the city of Lucknow, in Uttar Pradesh, staff greet visitors by putting their right hand to their chest and saying "Sahara Pranam". Pranam is a respectful version of hello.

Roy, often photographed wearing a black necktie and vest over a white shirt, is based nearby at the showpiece Sahara Shaher, a sprawling gated complex of low white buildings and lawns where he lives and where the group holds an annual mass wedding for 101 couples who could otherwise not afford it.

Starting with capital of 2,000 rupees in the late 1970s, Roy built Sahara into a giant that, according to its website, had assets of more than $21 billion as of April 2011.

Roy is often described as a billionaire but he is not on the Forbes list of rich Indians. Sahara's website says no dividend has been paid for 34 years and no profit has been taken out of the company.

From its north India base, Sahara has become a cashed-up global investor in hotels, sports and entertainment.

Last year, Roy teamed up with liquor baron Vijay Mallya of Kingfisher beer fame, paying $100 million for 42.5 percent of his Force India Formula One auto racing team. It paid $370 million for a franchise in cricket's Indian Premier League.

In 2010, Sahara considered buying English Premier League soccer club Liverpool and held talks to buy the debt of film studio Metro-Goldwyn-Mayer. Neither deal happened.

Still, Roy is not typically bracketed with a corporate elite led by Indian families such as the Tatas, Birlas and Ambanis.

"If you look at the orthodox business community, they have kept him at arm's length," said Ashok Prasad, a physician, lawyer and academic who taught overseas before returning to Gorakhpur, the Uttar Pradesh city where Roy started out.

Instead, Roy is associated with Bollywood celebrities and, like many tycoons, is seen as having good political connections.

Last year, K.M. Abraham, then a board member of India's capital markets regulator, which had ordered that the bonds be refunded in the case that ultimately went to the Supreme Court, wrote to the prime minister alleging "undue pressure" from the then-finance minister and his office to deal leniently with high-profile cases, including Sahara's.

The Finance Ministry and the regulator denied the allegations.

SAHARA-SIZED

Sahara says its land holdings in India are more than 33,600 acres. Although not all is majority-owned, it amounts to more than any listed Indian developer.

The group has two small listed units, Sahara One Media and Entertainment Ltd and Sahara Housingfina Corp Ltd, whose combined market capitalization is $48 million.

In 2009 another group company, property developer Sahara Prime City Ltd, filed a draft prospectus for an IPO to raise up to 34.5 billion rupees ($645 million). The deal never took place but it came back to haunt Sahara when the prospectus attracted the attention of India's securities regulator to the fund-raising scheme ultimately banned by the Supreme Court.

While an IPO of that size in India would typically see top-tier investment banks scrambling for a piece of the action, it was managed by four local brokers and Japan's Daiwa Securities SMBC, a small player in India. Several bankers at global institutions said they would not work with Sahara given concerns about governance and transparency.

"Their business model is not transparent. There are some grey areas," said the CEO of a large Indian bank, who like many people interviewed for this story declined to be identified given the sensitivity of the matter.

"Sahara has a lot of cash but we don't know where all this cash is coming from."

Not that it seems to need bankers. Unlike many big, acquisitive groups, Sahara's in-built funding sources mean it does not rely on bank loans.

"Have you ever seen Sahara's balance sheet? Nobody has seen it," said a senior executive at another major Indian lender.

THE PEOPLE

Among many poorer residents of Uttar Pradesh, India's most populous state, Sahara has substance. Its sponsorship of the Indian cricket team in a country mad about the sport adds to its credibility in small towns.

"Sahara bank? That way," an elderly tea stall operator in Harraiya said when asked for the location of the Sahara branch office, erroneously referring to it as a bank.

The branch itself, up a flight of stairs in a nondescript grey concrete building, was bustling on a recent day.

Sahara customers interviewed in Uttar Pradesh said they trusted the company, which has been around more than 30 years. Some had reinvested in Sahara products when they matured.

Sahara operates through nearly a million agents, who sign up clients and collect payments, sometimes on a daily basis.

"I have never been to a Sahara office. The agent comes, does all the paperwork, and collects the money," said Anil Tripathi, a travel agent who said he had doubled his money with Sahara.

Sahara has built a large niche in a country where 90 percent of the workforce is informally employed, half of households do not have bank accounts and loan-sharking is rife.

"The smallest of the small, the poorest of the poor - the banking industry is not able to cater to them," said Arvind Mohan, a Lucknow University economist.

THE RULING

The issue with Sahara is transparency and regulation, critics and regulators say.

For example, it does not always publicize its investment plan terms. A newer scheme, Q Shop Plan H, which is built around the group's new initiative to sell household goods directly to consumers, promises returns of about 135 percent after 6 years, according to a term sheet that does not mention Sahara. Some agents said they were asked to try and convert holders of the outlawed bonds to the new plan.

Asked if the details of the scheme banned by the court were explained to customers, a long-time Sahara employee in Uttar Pradesh said: "We don't have to explain all that. The depositor only wants to know how much he would be paying and how much he will get back on maturity."

The court ordered the money be repaid within 90 days, with 15 percent annual interest, prompting speculation over how Sahara will scrape that kind of money together.

Sahara responded with a rambling, full-page newspaper ad assuring investors their money was safe. It also condemned any suggestion it had raised any so-called "black money" or sought any undue favor from any authority.

"People cannot accept Sahara's super-fast growth. All along we have been getting beatings and beatings from all authorities, whereas we should be appreciated," it said. ($1 = 53.5100 Indian rupees)

(Additional reporting by Sharat Pradhan in LUCKNOW and Sumeet Chatterjee and Swati Pandey in MUMBAI; Editing by John Chalmers, Alex Richardson and Dean Yates)



Iranian Channel Decries \'Assassination\' of Its Correspondent in Syria

By ROBERT MACKEY

Iran's state-run Press TV reports that one of its correspondents was shot and killed by sniper fire on Wednesday in central Damascus, in an attack that also wounded the satellite news channel's bureau chief in the Syrian capital.

The correspondent, Maya Naser, 33, was born in Syria but reported for the channel in English. His wounded colleague, Hussein Mortada, is a Lebanese supporter of the Syrian government who also directs coverage of Syria for the Iranian government's Arabic-language satellite channel, Al Alam.

The channel's initial report on the deadly attack included audio of Mr. Naser's last dispatch. He was reporting live via telephone from outside a military headquarters in Damascus, bomb ed by rebels earlier in the day, when the line suddenly clicked off. Press TV said that Mr. Naser was shot by a sniper as he was speaking. A later report posted on the station's YouTube channel included footage of the correspondent just before the shooting, and an outraged statement from Press TV's news director in Tehran, who blamed governments that support the Syrian uprising for the reporter's “assassination.”

A video report from Iran's Press TV on the death of one of the channel's correspondents in Syria.

“We hold Turkey, Saudi Arabia and Qatar, who provide militants weapons to kill civilians, military personnel and journalists, responsible for the killing of Maya,” Hamid Reza Emadi of Press TV said. The news director also claimed that “the Western-backed killers in Syria are following the example of the United States in Iraq; the U.S. also sent snipers to assassinate people there.”

Somewhat conf usingly, at least some of the video Press TV used to show Mr. Naser and Mr. Mortada in Wednesday's reports seems to have been filmed last week. The images were used in a report posted on Press TV's YouTube channel on Sept. 18, in which Mr. Naser said that the crew had been “ambushed by a group of militants” while traveling in a Syrian Army vehicle in the sprawling Palestinian refugee camp in southern Damascus. In that report too, Mr. Naser said that Mr. Mortada had been wounded by sniper fire.

A Press TV video report broadcast last week showing the channel's Damascus bureau chief in a hospital.

As The Lede reported in February, reports on the crisis in Syria from Iran's state-owned satellite channels usually echo Tehran's strong support for the government of President Bashar al-Assad, casting the rebels as foreign-backed “terrorists,” with little popular support.

There have been suggestions that the simi larity of Press TV's reports to those broadcast on Syrian state television is no coincidence. In April, when The Guardian published a trove of hacked e-mails taken from the in-boxes of Syrian officials, one message from Mr. Mortada to one of Mr. Assad's media advisers included a complaint about the government not heeding directions passed on to him “from Iran and Hezbollah,” the Lebanese militant group, about who Syria should blame for bomb attacks.

After the e-mail was made public, Mr. Mortada strongly denied that he had advised the Assad government and defended his work for Iran and Hezbolah in an interview with the Arab newspaper Asharq Al-Awsat.

Mr. Naser's report last week from the Palestinian refugee camp in Damascus illustrates how closely the Iranian channel hews to the Syrian government line on the conflict. Despite video and photographic evidence of recent anti-Assad demonstrations in the refugee camp, Mr. Naser claimed in his voice-over that the go vernment military operation he witnessed there, “began when Palestinian refugees in the camp requested the Syrian Army's help to clear the area from armed groups.” In his sign-off, he said the Syrian Army was “chasing foreign-backed armed groups” from the area.

Like many other Syrian bloggers and journalists, Mr. Nasr made frequent use of social networks in his work. In his final update on Twitter, he reported the explosions in central Damascus on Wednesday morning.

His impartiality as a reporter was called into question last month, when he was among the first to draw attention on Twitter to false reports of setbacks for rebel forces in Aleppo that were posted on a Reuters Web site by pro-Assad hackers. After the reports were exposed as a hoax, neg lected to inform his readers on the social network until The Lede drew attention to his role.

Although Mr. Naser's Twitter profile clearly displayed his face, and the Press TV logo, and he appeared regularly on camera in his reports, he wrote last month that he was worried about being identified as an employee of the Iranian channel. In early August, Mr. Nasr complained about the fact that one of his Twitter updates (with the self-portrait he posted there) and a report he filed for Press TV from the Syrian city of Aleppo had been featured in The Lede's report on the fake Reuters reports. “I am in a war zone, there is a price on our heads,” he wrote.

After a pro-Assad television studio was attacked in June, Syrian activists disagreed sharply about whether Syrian reporters whose work might be considered propaganda should be considered legitimate targets for armed rebels. Rami Jarrah, a Syrian opposition activist in Cairo, told The Lede then that while the faci lities of “state-controlled television” are “an element of the regime,” journalists are “absolutely not” legitimate targets for attack or assassination.

According to Press TV, Mr. Naser “studied political science at Kuplan University,” in the United States, possibly a reference to Kaplan University, a subsidiary of The Washington Post Company that offers online degrees.

While Mr. Naser's work for the Iranian channel was not overtly personal in nature, he did reveal his feelings about the conflict tearing his country apart on Twitter, where he regularly sparred with critics, and in blog posts. In a post on the Syria Politics blog two months ago, headlined “Night in Damascus,” Mr. Naser wrote:

Little bit after midnight, me looking out from the window of my bedroom inside Damascus city, watching a full sky moon and listening to the sounds of the army shelling rebels sites in outskirts, asking myself; is this real? Is this fire I can barely see is someone's house burning, or maybe neighborhood store? Is this my country on fire?

Then for a moment I convince myself, I am just dreaming and my day is going to be busy one, I better go sleep, I ought to wake up in few hours to go my work, multiple meetings are waiting ahead, then a lunch with my beloved girlfriend, afterward I have gathering with my best friend to discuss his wedding details. Basically; in few hours I have to get up to have another hard day of life? Who said life should be easy anyway!!!

Then I snap out of this sweet dream, just to remember, I lost my job! That friend of mine had been killed few weeks ago; his body was sent to his fiancé in a black bag! We didn't know why he was slaughtered; we didn't understand what his fault was! He was a doctor serving patients, never been into politics, but sure never been pro Assad, amid all this, the reality hit me, he was minority and the years his father spent at prison for being oppo sition for the current system didn't grant my friend any mercy, his ethnic roots were stronger to be noticed than his family position of this system! And yes this is my country, and this fire is at someone's place, someone I might never know but that doesn't mean he never existed!!!



Images of Clashes at Anti-Austerity Protests in Europe

By JENNIFER PRESTON

As my colleagues Liz Alderman and Niki Kitsantonis report, tens of thousands of demonstrators gathered in Athens to protest salary and pension cuts on Wednesday. The rally, which began peacefully, turned violent in the early afternoon when a small group of demonstrators threw Molotov cocktails at police officers and firebombs at government buildings near the Greek Parliament.

The violence came after anti-austerity protesters in Spain clashed with police officers outside the Parliament building in Madrid. Video posted online showed the violence in both capitals.

Protesters scattered in Athens's Syntagma Square as black smoke filled the air and the police responded with tear gas and batons.

What began as a peaceful protest in Athens against austerity measures turned violent after a small group of protesters threw Molotov cocktails at the police.

Stathis Kalligeris, a photographer, captured multiple images of the demonstration showing how it began peacefully but devolved into violence.

Before the firebombs were thrown by a small group of protesters, teachers and medical personnel joined the march as trade union groups called for a nationwide strike against the cuts that make up a $15 billion austerity plan.

By afternoon, the crowd dispersed as firefighters put out the lingering fires.

In Spain, organizers against the austerity measures called for a protest in Madrid to begin early Wednesday evening, a day after thousands of people showed up for a peaceful demonstration that ended with violent clashes with the police outside the Parliament building.

My colleague Raphael Minder reported that the protests came as Prime Minister Mariano Rajoy was coming under intense pressure from investors and his European counterparts to clean up Spain's banks and public finance.

In this video, captured and posted on YouTube by Tim Pool, a freelance video journalist who was in Madrid, the police can be seen wielding batons against the crowd.

El Pais, which published more video of the violence, reported on Wednesday that government officials defended police a ctions.

El Pais reported on Wednesday that the police had arrested 35 demonstrators on a variety of charges as people criticized what they viewed as a harsh response by the police during the protest.

El Pais also quoted Cristina Cifuentes, the government delagate in Madrid, about her support for the police response.

“They have my absolute support, and I want to congratulate the National Police because they showed professionalism during difficult times,” said the government delegate in Madrid, Cristina Cifuentes, on Wednesday. Cifuentes had earlier warned that all protests in front of Congress were illegal and demonstrators would only be allowed to converge on Neptune square.

Cifuentes said the police came under a “disproportionate attack,” with people at the protest hurling “stones, screws and bottles,” at the law enforcement officers.



Egyptian-American Commentator Arrested in Times Square for Defacing Subway Ad Calling Israel\'s Opponents \'Savage\'

By ROBERT MACKEY and MATT FLEGENHEIMER
Video of the Egyptian-American journalist Mona Eltahawy being arrested for defacing a poster in the Times Square subway station on Tuesday.

An Egyptian-American columnist, who rose to prominence on social media last year for her commentary during the revolution in Egypt, was arrested in the Times Square subway station on Tuesday for spraying pink paint on a pro-Israel poster that calls Islamist opponents of the Jewish state “savage.”

The poster was one of 10 placed in subway stations across the transit system this week, on the heels of violent and sometimes deadly protests across the Muslim world in response to an American-made video mocking the Prophet Muhammad.

The Metropolitan Transportation Authority had initially rejected the ads, citing their “demeaning” language. Read more on the City Room blog.



Image of the Day: September 26

By THE NEW YORK TIMES

The King of Good Times Dismantles His Empire

By HEATHER TIMMONS and NEHA THIRANI

NEW DELHI - Suddenly, everything that was once part of the sprawling empire of Indian businessman Vijay Mallya seems to be up for sale.

Mr. Mallya once took over a sleepy family business at age 27 and reinvented it in his own image into a jet-setting, luxury-loving consumer-friendly group of companies called U.B. Group. Yet in a period of a few days, he seems ready to sell it off piece by piece.

On Wednesday, before the company's annual meeting, Mr. Mallya told reporters that Kingfisher Airlines was “in talks” with foreign carriers about a stake sale.  He declined to be more specific.

The airline has not made a profit since it started in 2005, is late on payments for about 70 billion rupees ($1.3 billion) in bank loans, and has not paid most of its staff for months.

Just a day earlier, Mr. Mallya's liquor company, United Spirits, said it was in talks with the beverage giant Diageo about a stake sale. Any deal is expected to dilute Mr. Mallya's 28 percent stake in United Spirits substantially, to the point where he has little to no control over the business.

“This is a difficult thing to digest,” said Sharan Lillaney, an analyst at Angel Broking. “Mr. Mallya will have to relinquish his crown jewel,” he said.

His company's  less-glamorous businesses - fertilizers and engineering - are also looking for potential investors or acquirers, analysts and bankers said. Those deals, too, are expected to leave Mr. Mallya without control.

The airline has been the biggest burden on the company's operations as its executives seemed willing to practically gamble away the health o f the group's other businesses, which were used as collateral for bank loans to the airline. Now Mr. Mallya needs to raise cash to pay off those debts.

Losing control of the businesses he carefully shaped could will be a sharp change for a man who was regularly featured on Forbes “billionaires list,” who collected expensive cars, as well as sponsored a Formula One team, and whose parties, in Mumbai and at his Goa seaside home were regularly attended by top-shelf Bollywood stars and some of India's most powerful politicians.

Mr. Mallya's airline, which seemed to be modeled loosely on Richard Branson's Virgin Airways, features red-suited stewardesses, a generous frequent flyer program and, at least when it started, high quality food.

He wowed the Paris Air Show in 2007, ordering 50 Airbus planes, and promising an overseas expansion to the United States and Europe.

But by 2009, he was forced to take on bank loans to fund the airline, and post-pone de liveries of new planes. Instead of flying to Paris or San Francisco, the airline's new international destination was Dhaka, Bangladesh. Now the company no longer flies international, lists just 12 planes on its corporate website, down from more than 70, and has cut its domestic flights drastically.

Even back in 2009, Mr. Mallya was looking for a deal. “We are in discussion with private equity investors,” Mr. Mallya told The New York Times in June of 2009. “Certain airlines have shown keen interest as well, subject to the government policy allowing them to invest.”

In India, where heavily-subsidized state carrier Air India skews the playing field and competition was stiff for new passengers from the country's growing upper middle class, profitability has eluded most private carriers.

The Indian government said this month that it would allow foreign airlines to purchase 49 percent of Indian carriers, but the change may have come too late. A few years ago, airlines from the Middle East, Asia and Europe were considered likely acquirers in the Indian market, but Kingfisher won't attract them now because of its financial issues, analysts said Wednesday.

“I don't think any clear deal will go through for Kingfisher because the airline is in very bad shape and the aviation business globally is in bad shape,” said A. K. Prabhakar, the senior vice president of equity research at Anand Rathi Financial Services in Mumbai.

Neha Thirani reported from Mumbai.



The King of Good Times Dismantles His Empire

By HEATHER TIMMONS and NEHA THIRANI

NEW DELHI - Suddenly, everything that was once part of the sprawling empire of Indian businessman Vijay Mallya seems to be up for sale.

Mr. Mallya once took over a sleepy family business at age 27 and reinvented it in his own image into a jet-setting, luxury-loving consumer-friendly group of companies called U.B. Group. Yet in a period of a few days, he seems ready to sell it off piece by piece.

On Wednesday, before the company's annual meeting, Mr. Mallya told reporters that Kingfisher Airlines was “in talks” with foreign carriers about a stake sale.  He declined to be more specific.

The airline has not made a profit since it started in 2005, is late on payments for about 70 billion rupees ($1.3 billion) in bank loans, and has not paid most of its staff for months.

Just a day earlier, Mr. Mallya's liquor company, United Spirits, said it was in talks with the beverage giant Diageo about a stake sale. Any deal is expected to dilute Mr. Mallya's 28 percent stake in United Spirits substantially, to the point where he has little to no control over the business.

“This is a difficult thing to digest,” said Sharan Lillaney, an analyst at Angel Broking. “Mr. Mallya will have to relinquish his crown jewel,” he said.

His company's  less-glamorous businesses - fertilizers and engineering - are also looking for potential investors or acquirers, analysts and bankers said. Those deals, too, are expected to leave Mr. Mallya without control.

The airline has been the biggest burden on the company's operations as its executives seemed willing to practically gamble away the health o f the group's other businesses, which were used as collateral for bank loans to the airline. Now Mr. Mallya needs to raise cash to pay off those debts.

Losing control of the businesses he carefully shaped could will be a sharp change for a man who was regularly featured on Forbes “billionaires list,” who collected expensive cars, as well as sponsored a Formula One team, and whose parties, in Mumbai and at his Goa seaside home were regularly attended by top-shelf Bollywood stars and some of India's most powerful politicians.

Mr. Mallya's airline, which seemed to be modeled loosely on Richard Branson's Virgin Airways, features red-suited stewardesses, a generous frequent flyer program and, at least when it started, high quality food.

He wowed the Paris Air Show in 2007, ordering 50 Airbus planes, and promising an overseas expansion to the United States and Europe.

But by 2009, he was forced to take on bank loans to fund the airline, and post-pone de liveries of new planes. Instead of flying to Paris or San Francisco, the airline's new international destination was Dhaka, Bangladesh. Now the company no longer flies international, lists just 12 planes on its corporate website, down from more than 70, and has cut its domestic flights drastically.

Even back in 2009, Mr. Mallya was looking for a deal. “We are in discussion with private equity investors,” Mr. Mallya told The New York Times in June of 2009. “Certain airlines have shown keen interest as well, subject to the government policy allowing them to invest.”

In India, where heavily-subsidized state carrier Air India skews the playing field and competition was stiff for new passengers from the country's growing upper middle class, profitability has eluded most private carriers.

The Indian government said this month that it would allow foreign airlines to purchase 49 percent of Indian carriers, but the change may have come too late. A few years ago, airlines from the Middle East, Asia and Europe were considered likely acquirers in the Indian market, but Kingfisher won't attract them now because of its financial issues, analysts said Wednesday.

“I don't think any clear deal will go through for Kingfisher because the airline is in very bad shape and the aviation business globally is in bad shape,” said A. K. Prabhakar, the senior vice president of equity research at Anand Rathi Financial Services in Mumbai.

Neha Thirani reported from Mumbai.