India's Governing Party Shows Spine for a Change

NEW DELHI - On Sunday, thousands of people assembled in Delhi to have a good time as three earnest but ungifted orators talked about the benefits of “foreign direct investment” and the other things that will come their way as long as they are in the care of the government led by the Indian National Congress party.

The speakers were Prime Minister Manmohan Singh; the Congress party's president, Sonia Gandhi; and her son, Rahul Gandhi, the party's general secretary. The rally was intended to be the war cry of the party, which has in recent times been hit by a string of corruption charges. Reacting to the huge gathering, Shashi Tharoor, minister of state for human resource development, tweeted, “The Party fights back.”

It is not unusual for a political party to stage a rally or for thousands to turn up, but what is unusual is the way the Congress party has chosen to rehabilitate its battered image as it prepares for the general elections, which are scheduled for 2014. On Sunday, the party did not dwell on its standard claims of loving farmers, of subsidizing lives and of its enduring love for all religions and castes. Instead, it tried to explain to the masses, a majority of whom were from rural areas, the importance and the inevitability of long-term economic measures.

Among these reforms is the lifting of restrictions on foreign retail chains investing in India. The government has allowed these companies to own up to 51 percent of their Indian ventures as long as they comply with certain conditions.

The change became controversial after various political parties played on the fears of millions of small local shop owners who fear that they will become irrelevant if stores like Walmart and Carrefour come to India. Politicians with obsolete ideas, of whom there are many in the country, even invoked an old Indian fear that is not widely perceived anymore - the ghost of the East India Company, the British firm that came to trade with India and ended up ruling it. In October's festive season, when the effigies of demons were ritually burned, one of the demons on a street in Kolkata was the effigy of an East India Company executive with “FDI” (for foreign direct investment) stuck on his chest.

The Congress party has been resolute and has withstood all opposition from friends and foes, which is uncharacteristic. The party has many strengths, but spine has never been among them. On Sunday, the party told the people that there was evidence from other countries to suggest that the arrival of retail chains like Walmart would create more jobs, not deplete them. Several Indian states are set to open the multibrand retail segment to foreign chains, but some state governments have said that they will not. India's federal structure gives every state the right to reject some of the policies of the central government.

In his speech on Sunday, Rahul Gandhi said that India's biggest problem was that the political system was flawed and that Indian politics did not permit a fair representation of the “common man.” A majority of Indian politicians, especially the younger ones in the Congress party, hail from political families. Mr. Gandhi's comment is a part of his self-whipping act, as he himself is the biggest beneficiary of dynastic munificence. He has, at least once in public, said that he is “the symptom” of the problem. It is not clear how he plans to save Indian politics from nepotism, but he has evidently decided to whip himself, as strategy or penance, until he knows the answers.

There is a touch of martyrdom in his tone and words. He often manages to spin the privilege of his political ancestry as an inescapable trap of destiny from which he chooses not to escape because he wants to serve the nation. It is inevitable that the Congress party's fight to redeem itself will increasingly depend on his royalty-like branding.

The chief tormentors of the party have been the new anti-corruption revolutionaries and an old political foe, Subramanian Swamy, president of the Janata Party, who surfaces every now and then with extraordinary allegations of corruption against the Gandhi family. But there is some comfort for the Congress party. Its rival, the Bharatiya Janata Party, is a bit worse off.

The news media have long accused the anti-corruption activists of functioning like secret mercenaries of the B.J.P. Finally, last month, one of the activists, Arvind Kejriwal, perhaps in a move to lend himself greater credibility, produced seeming evidence of corruption against the B.J.P.'s president, Nitin Gadkari. Since then, the hefty Mr. Gadkari has sunk deeper and deeper into a political quagmire and the B.J.P.'s leadership has looked disoriented and confused in its rescue missions. It's as if the Congress were a grand veteran who knows how to take serious blows and the B.J.P. an amateur who is easily rattled.

In the Congress party's fight for survival, one of the factors that will assist it is an old charm: the sense among voters that the other parties are probably worse.

Manu Joseph is editor of the Indian newsweekly Open and author of the novel “The Illicit Happiness of Other People.”

A version of this article appeared in print on November 8, 2012, in The International Herald Tribune.

Gulf Oil of India to Buy Houghton International for $1 Billion

LONDON â€" The Gulf Oil Corporation, an Indian company, agreed on Wednesday to buy the chemical and lubricant company Houghton International from the private equity firm AEA Investors for $1 billion.

Gulf Oil, which is part of the Indian conglomerate Hinduja Group, said it would use the strong presence of Houghton in the United States, Europe and Asia to expand its lubricants operations, primarily in the industrial and automotive sectors.

Gulf Oil is controlled by the Hinduja brothers, billionaires who operate companies in sectors like energy, media and banking.

Gulf Oil, based in Hyderabad, India, manufactures lubricant products for the agricultural, automotive and industrial sectors. Houghton, based in Houston, will continue to be run as a separate business. The acquisition will be made through Gulf Oil's British unit, according to a company statement.

Houghton reported pretax profit of $132 million for the 12 months ended Sept. 30, on revenue of $858 million, Gulf Oil added.

AEA Investors, based in New York, acquired Houghton in 2007 for an undisclosed amount.

RBC Capital Markets advised Gulf Oil on the deal, while Deutsche Bank and Morgan Stanley advised AEA Investors.

This post has been revised to reflect the following correction:

Correction: November 7, 2012

An earlier version of this article misstated Houghton International's results. It reported pretax profit of $132 million for the 12 months ended Sept. 30, not pretax sales.

As Teletubbies Exit India, BBC Blames \'Uniquely Challenging\' Market

A screenshot of children's television series “Teletubbies” that runs on the BBC channel “CBeebies.”

Fans of BBC Entertainment and CBeebies are mourning the pending departure of these two BBC channels in India, and parents are among those viewers who will feel the loss most keenly.

Both BBC Entertainment and CBeebies arrived in India five years ago and won a cult-like following for their quality programming, but they were pulled because of financial considerations, citing India's delays in digital transmission and carriage fees, BBC executives said in a statement last week.

“India is one of the only markets where you have to pay for carriage ,” Mark Whitehead, senior vice president and general manager of BBC Worldwide Channels Asia, said in an interview. “It is uniquely challenging.”

According to a report released earlier this summer by Chrome Data Analytics and Media, a media consultancy, broadcasters paid out about $60 million, or 300 million rupees, more in carriage fees in the 2012 fiscal year compared to a year prior.

Delays in digitization affect broadcasters like the BBC because analog cable operators in India are purported to underreport subscriber data, leading to lower audience measures, which eventually affects ad rates that broadcasters can command. The Indian government's drive toward digitization hopes to address some of these issues by making all broadcasters transmit digitally by the end of 2014 deadline.

In the first phase, the metropolitan areas of Delhi, Mumbai, Kolkata and Chennai were supposed to achieve this goal by the end of October, bu t Chennai and Kolkata have not met the deadline, according to news reports.

When the two BBC channels shut down at the end of the month, viewers of BBC Entertainment will have plenty of other options for quality TV shows on other networks, but CBeebies is the only children's channel in India that offers wholesome entertainment with no commercial interruptions, a blessing for parents who have to constantly have to bat down their children's requests for this toy or that toy or sweets that are advertised on TV.

From the global TV phenomenon “Teletubbies” to “Everything's Rosie” to “Numberjacks” to “Charlie and Lola” to “Waybuloo” to “In the Night Garden,” CBeebies's programming met with the type of enthusiastic parental approval normally reserved for wildlife documentaries or televised spelling bees.

Where else can you find a delightful arts and crafts show, “Mister Maker,” that teaches toddlers about colors and shapes by making dol ls and paintings from everyday found objects, like pasta shells, discarded cardboard and buttons? Many a future design whiz could be inspired by this wonderful program. My 2-year-old daughter, Serena, and I love watching the show and making things together, and I know plenty of other parents who do so too.

That's because CBeebies filled a void. Other children's programming in India is heavily entertainment- and cartoon-focused. A local version of “Sesame Street,” “Galli Galli Sim Sim” is popular, and while cartoons like “Chotta Bheem” and “Krishna” help impart mythological tales, they are heavy on death and destruction.

My 7-year-old son, Yuvraj, loves Japanese imports like “Doraemon,” “Ninja Hattori” and “Kiteretsu,” but I am fairly certain their positive impact on a young mind is negligible. Plus, they are so commercial heavy, I can't tell if he's watching the cartoon or the ads.

Other parents shared my dismay at the loss of CB eebies. At a play center in central Mumbai, mothers reacted to the news with gasps of horror. “It was just the nicest programming,” said Pareena Lamba, adding, “I feel very sad.”

Miel Sahgal, another parent, said, “It's the only channel where your kid is not seen as consumer because there's no advertising. And there's a lack of violence. The irony is that maybe because they don't have ads, it's being removed.”

Fans also poured out their grief on the CBeebies Asia Facebook page. “Terribly, terribly disappointed to hear of CBeebies exit from India. Without reservation I believe that Indian television has no suitable replacement (and never will!) for the CBeebies,” said one user. “What a disaster,” another viewer lamented.

The BBC said it is trying to fill the gap by adding more shows to its Web site, and while that is helpful, it is not ideal for parents, given that Internet access in India is limited and slow.

Mothers were also worr ied about their kids' reactions to the unwelcome news, saying they were terrified to break the news to their little ones.

“You better not tell Serena because she will cry,” my son said. Imagining the meltdown when her favorite shows fail to materialize on Dec. 1, I am now on a mad hunt to stock up on DVDs and save clips from YouTube so peace can prevail.

Israeli Left Mocks \'Bibi\'s Bet on Romney\'

As my colleague Alan Cowell reports, President Obama's re-election could prove to be awkward for Israel's prime minister, Benjamin Netanyahu, since the conservative Israeli leader “was widely perceived in Israel and the United States as having supported the Republican challenger, Mitt Romney.”

Remarks by Mr. Netanyahu, in which he seemed to chastise Mr. Obama for not taking action to defend Israel from the threat of an Iranian nuclear bomb, were used in a television ad that ran in Florida during the final weeks of the campaign. That ad was produced by a Republican political operative who has worked for the Israeli prime minister. (During the secretly recorded address Mr. Romney gave to wealthy donors in Florida this year, he boasted that consultants working for his election “work for Bibi Netanyahu in his races.”)

Several observers detected more than a little awkwardness in video of Mr. Netanyahu with the American ambassador to Israel, Daniel Shapiro, o n Wednesday, in which he seemed to force a smile as he said, “I want to congratulate President Obama on his re-election.”

Video of Israel's prime minister asking the American ambassador to pass on his congratulations to President Obama.

A former Israeli prime minister who could challenge Mr. Netanyahu in upcoming elections, Ehud Olmert, criticized what he called his rival's failed attempt to interfere in the U.S. election as “a significant breach of the basic rules governing ties between nations.”

As the Israeli news blog +972 reported, Mr. Netanyahu's political opponents on the Israeli left, gloating over the failure of “Bibi's bet on Romney,” were filled with hope that Mr. Obama might soon remind their prime minister th at he'd backed the loser. In one image passed around on Facebook by Israelis on Wednesday, with Hebrew-language dialogue added in speech bubbles to photographs of the two leaders, the imagined exchange between the two men went like this:

Mr. Obama: “Benjamin, what's up? Say, remember how much you intervened and tried influence the presidential elections here in the States?”
Mr. Netanyahu: “Yeah, why?”
Mr. Obama: “Oh, no reason.”

Eyal Brave, via Facebook A composite image posted on Facebook on Wednesday, imagining a p ost-election conversation between President Barack Obama and Prime Minister Benjamin Netanyahu of Israel.

Another image was shared by Israeli Facebook users who hoped that Mr. Obama's victory might be a harbinger of defeat for Mr. Netanyahu in the upcoming elections in Israel.

Shachar B. Cotani, via Facebook An image shared on Facebook by Israelis who are rooting for Prime Minister Benjamin Netanyahu to lose the upcoming election.

Writing in The Forward, a Jewish-American newspaper, Josh Nathan-Kazis noted that one of Mr. Netanyahu's strongest supporters, Sheldon Adelson, a major Repub lican donor, had gambled and lost even more heavily on Tuesday's elections.

It's been a tough night for Jewish political mega-donor Sheldon Adelson, the Las Vegas casino magnate who was the biggest political donor of the election cycle. Adelson and his wife had backed Mitt Romney with $20 million in donations to the pro-Romney super PAC. But his spending on failed Republican candidates went well beyond the top of the ticket.

Four additional Adelson-backed candidates lost their races tonight. In Virginia, Tim Kaine won the governorship over George Allen, whose super PAC had received $1.5 million from Adelson. In Florida, Bill Nelson won the Senate seat over Connie Mack, who Adelson had backed with $1 million. And in New Jersey, Adelson-backed Orthodox Jewish Republican Shmuley Boteach lost to Democratic incumbent Congressman Bill Pascrell.

In Florida's 18th Congressional District, Adelson-backed Republican Allen West narrowly trailed Democrat Pat rick Murphy, who was declared the winner by news organizations.

I want to play poker with Sheldon Adelson.

- Jeffrey Goldberg (@JeffreyGoldberg) 7 Nov 12

Image of the Day: Nov. 7

Agence France-Presse - Getty ImagesArtist Sudarsan Pattnaik giving final touches to a sand sculpture of U.S. President Barack Obama in Puri, Orissa.

India\'s Outsourcing Industry Welcomes Obama Win

Vivek Prakash/ReutersThe office of an information technology company in Mumbai, Maharashtra, in this March 19, 2012 file photo.

Even though President Barack Obama railed against outsourcing in his campaign, information technology titans and trade groups in India warmly welcomed his re-election, as they were optimistic that he would cement bilateral ties and improve the United States economy in his second term, which in turn would improve their business.

Outsourcing is a controversial topic in the United States, and in a political campaign it can be downright poisonous, as it was in this election. Bain Capital, the private equity firm that Mitt Romney once led, was criticized by President Obama for investing in companies that moved jobs overseas, and one of Mr. Obama's campaign ads nicknamed Mr. Romney the “Outsourcer in Chief.”

In his victory speech, Mr. Obama brought up his plans to ensure American children grow up in a country that attracts jobs by investing in technology - “a country that lives up to its legacy as the global leader in technology and discovery and innovation, with all the good jobs and new businesses that follow.”

Most outsourcing industry leaders in India said they believed that much of Mr. Obama's criticism of outsourcing was campaign rhetoric, and that it would not actually affect his policy decisions.

“In the last four years, his policies have been pro-business,” Ameet Nivsarkar, vice president global trade development for the National Association of Software and Services Companies, or Nasscom, Indi a's technology industry association, said in an interview. “There have been no decisions that are substantially challenging for the industry.”

While other countries like the Philippines and Costa Rica have recently attracted outsourcing business, the Indian outsourcing industry is still growing fast. Revenues for India's information technology and outsourcing industries are expected to cross $100 billion this financial year, up almost 15 percent from a year ago and double the revenues in 2007, Nasscom said in a  report released earlier this year.

Analysts said the United States is a significant driver of growth for the Indian outsourcing industry. “It's clearly the largest partner,” said Mohit Ralhan, managing partner of Indus Balaji Private Equity.

Indian business leaders and policy experts on Wednesday underscored the importance of a strong economic recovery in the United States because of the global impact it would have on countries including In dia.

“Now the focus will be on driving economic growth, which will lead to increased prosperity and greater job creation in the U.S., as well as act as a catalyst for growth across the world,” said N.  Chandrasekaran, the chief executive of Tata Consultancy Services, in a statement. “Technology will play a strong role in driving the next phase of growth,” he predicted, adding that Indian companies may play a significant role by forming partnerships with companies in the United States.

R. V. Kanoria, president of Federation of Indian Chambers of Commerce and Industry, said in a statement that he hoped the new Obama administration would “take a long-term and practical view on issues such as outsourcing, which ultimately are in the U.S. national interest” because outsourcing helps American companies drive down costs and expand.

Nasscom said it shared many of the economic goals Mr. Obama hopes to achieve and highlighted the need to work together as the global economy recovers. “It is more important than ever that India and the U.S. find ways to partner together to spur innovation, foster economic growth, develop an educated and skilled workforce and create jobs for the modern global marketplace,” it said in a statement.

What They Said: The U.S. Election

President Barack Hussein Obama's reelection in the United States was welcomed by the Indian government, but provoked mixed reactions from business leaders, who remain concerned about Mr. Obama's business outsourcing policies for India.

Prime Minister Manmohan Singh: Welcomed President Obama's second term in office, offering his “warmest congratulations.”  He said Mr. Obama's victory gave him a mandate to continue pursuing global peace and progress.

“I have no doubt that there is much more we can do together to further strengthen the India-U.S. partnership and thereby advance peace and stability, expand mutual economic opportunities, harness the potential of science and technology, innovation and higher education and empower our people to address global challenges,” the prime minister said in a congratulatory letter posted on Twitter by a government spokesman.

Ministry of External Affairs, Government of India: A press statement posted on the ministry website said: “India and the U.S. have developed extensive bilateral cooperation and partnership based on shared values based on belief in democracy, the rule of law and pluralism. We look forward to continuing to deepen and widen the engagement between India and the U.S. in the years ahead.”

Adi Godrej, chairman of the Godrej Group: “This is a good development for India. Between two large economies there will be issues and concerns. Outsourcing is also a concern and I hope it will be addressed soon,” he said, according to a PTI report cited by Hindustan Times.

Pramod Bhasin, former chief executive of Genpact, one of India's largest business process outsourcing companies: “I think there will be greater implications as he focusses on issues like unemployment. I just hope he remains true to free trade and all the other things that he talks about so well,” Mr. Bhasin said of President Obama, in a PTI report cited by Hindu stan Times.

R. V. Kanoria, president of the Federation of India Chambers of Commerce and Industry: “We hope that the new Obama Administration will take a long-term and practical view on issues such as outsourcing which ultimately are in the US national interest because they help US companies drive down costs paving the way for expansion,” he said in a statement.

 

 

Obama\'s Win Closely Watched in India

Rafiq Maqbool/Associated PressAn American national watching the election results during an event organized in Mumbai, Maharashtra on Wednesday.

The U.S. presidential election results were closely followed in India on Wednesday morning at breakfast parties across the country, in private homes and on television news channels, which ran nonstop coverage of the event.

On the lawn of the art deco Imperial hotel in New Delhi, hundreds of Americans, Indians and people with ties to both countries gathered for a breakfast sponsored by the U.S. Embassy, watching CNN on a big screen as a band in boater hats pl ayed Johnny Cash tunes with a polka beat.

Hurricane Sandy helped President Barack Obama, said Gaurang Kanth, a New Delhi attorney who was at the Imperial breakfast. “It was divine intervention,” he said. “It was all about praying to the Indian god,” he added with a laugh. Before the 2008 elections, a group of Indians gifted a statue of the Hindu god Hanuman to Mr. Obama, after Time magazine reported that he carried a tiny statue of a monkey as a good luck charm.

Roberto Schmidt/Agence France-Presse - Getty ImagesObama supporters celebrat ing at the Imperial Hotel in New Delhi after news came in that President Barack Obama had been re-elected on Wednesday.

English-language news channels in India ran continuous, uninterrupted coverage of the election Wednesday morning from U.S. channels, and brought in experts with experience in the United States to explain what was happening to viewers. “The right-wing Tea Party thing is just not working,” G. Parthasarathy, a retired diplomat who was stationed in Washington, told CNN-IBN.

At the Hard Rock Cafe in Hyderabad, American expatriates tucked into a breakfast of bacon and eggs and watched the election results on CNN. When the network declared Mr. Obama's victory, there were cheers.

Though the Internet provided minute-by-minute coverage of the election, some expatriates said it was no replacement for experiencing the race in person.

“We streamed the debates at our apartment and I read Ezra Klein every morning, but I still felt a bit disconnected trying to stay abreast of the news,” said Kelsey Coates, who lived in Washington before moving to Hyderabad for a fellowship in social enterprise. “I lived in D.C. You can't trade anything for the experience of being there.”

Elvin John, an official at the U.S. Consulate in Hyderabad, which organized the breakfast, said the event was a chance for Americans in Hyderabad to share the election with each other. “If you're living abroad, you want to feel at home when you're dealing with such a huge event,” he said. “That's why we picked an American venue.”

Just over 40,000 Americans were registered as residents in India in 2009, the latest figures available. But the number of Americans with roots in India is much higher, and strong trade and diplomatic ties are considered integral to both countries.

As CNN called the election for Mr. Obama, cheers rang out on the lawn of the Imperial hotel in New Delhi, and groups of businesspeople, students and embassy staff members waved American flags. The volume on the big screen was turned down and the band's amplifiers turned up. They lit into a celebratory rendition of “Tequila.”

Courtesy of American Embassy, DelhiU.S. Ambassador Nancy J. Powell addressing the gathering at the Imperial Hotel in Delhi on Nov. 7.

Then the U.S. ambassador to India, Nancy J. Powell, addressed the crowd.  “Election Day in America, like India, is a very special day,” she told the crowd. While the United States has the world's oldest democracy, India has the largest, she noted. The election process “makes me proud t o be an American, and a small-d democrat,” she said.

At the World Economic Forum's annual India conference outside New Delhi, many participants were following the U.S. election on their phones and tablet computers during a speech by the Canadian prime minister, Stephen Harper. The group seemed to generally be supporting Mr. Obama.

Sanjay Kapoor, managing director of Genesis Luxury, a fashion company based near New Delhi, said he found the election unexciting, particularly for Indians, because he felt Mr. Obama had done little to improve U.S.-India relations and because he did not think his Republican challenger, Mitt Romney, would do much for bilateral relations either.

“I don't think bilateral trade or relations with the United States have really changed with him,” Mr. Kapoor said about Mr. Obama on the sidelines of the conference. “I am really concerned about us, and I don't think he has done much.” But he added that even if Mr. Romney had won, he would not have expected much of a change in U.S. policy toward India.

No matter who wins, “it is not going to make a substantial difference to India,” agreed Ashok Swarup, a corporate lobbyist at the Imperial Hotel breakfast. “It is a relationship that has been growing, and no President wants to rock that boat.”

Sruthi Gottipati contributed reporting from New Delhi.