Talks begin for Goa leadership change
DISCUSSIONS BJP’S leaders and Goa allies meet Amit Shah
PANAJI : Leaders of the Bharatiya Janata Party (BJP) and its allies Goa Forward Party (GFP) and Maharashtawadi Gomantak Party (MGP) began talks in the national capital on Wednesday over the possible successor to ailing Goa chief minister Manohar Parrikar, according to people privy to the initial discussions, who sought anonymity.
The state’s health minister, Vishwajit Rane, is being seen as one of the front-runners for the job, but there is stiff opposition to his name from some sections of the BJP and the two allies on the grounds that he was with the Congress until March 2017, one of the people cited above said.
“We are working on different scenarios and they will be discussed with the national president (Amit Shah),” said a senior Goa BJP leader who asked not to be named.
Meanwhile, Subhash Shirodkar and Dayanand Sopte, who quit the Congress to join BJP -- in a move orchestrated by Rane, according to functionaries from both parties -- met Parrikar on Wednesday evening at his private residence in Goa.
“Sopte and I met the CM. His health is improving, He said we have his complete support and we should start working in our constituencies,” said Shirodkar.
The Congress’s strength in the Assembly has now shrunk to 14, the same as the BJP, and the strength of house has come down from 40 to 38. The BJP also has the support of three GPF, three MGP, and three independent MLAS.
Over the last few weeks, the Congress has been demanding Goa governor Mridula Sinha to invite the party to form the government on the grounds that it is the single-largest party in the assembly, and the resignation of the two MLAS is a big blow to it.
But the induction of the two Congress legislators into the BJP also led to fireworks in the ruling party’s Goa core committee meeting in Panaji on Wednesday, with some senior leaders speaking up against it. “Do you think I am happy?” asked Laxmikant Parsekar, the former Goa chief minister who was defeated by Sopte in last year’s assembly elections. Parsekar said the Goa government was formed “against the will of the people”. Another former BJP minister and member of the party’s core committee, Dayanand Mandrekar, said that the committee was not informed about the two Congress leaders joining the BJP. “Had this been discussed before the core committee, I would have said its not possible to induct a person who has betrayed the party on election-eve,” he said, referring to Sopte to had moved from the BJP to the Congress last year.
Goa BJP president Vinay Tendulkar said, “Parsekar is an intelligent leader, he is professor, he is a principal and a former CM and former state president. He needs to think before he speaks,” Tendulkar said. NEWDELHI: India is considering a dollar deposit scheme for nonresident Indians (NRIS) to stem the decline of the rupee by increasing dollar inflows, a senior official in the finance ministry said on condition of anonymity. The exact contours of the scheme are being worked out, this person added.
This is the first time a government official has admitted that the government is seriously considering such a move, although there has been wide speculation on this front.
So far this year, the rupee has lost 15% of its value vis-à-vis the dollar and has been among the worst performing currencies in emerging markets. The falling rupee, rising crude oil prices (which pinch even more because India imports 80% of its oil requirements) and an uncertain export outlook because of a looming trade war have caused trade deficit to widen.
Meanwhile, rising interest rates in the US have triggered capital outflows, eroding foreign exchange reserves and increasing pressure on the rupee.
The proposal for the NRI dollar deposit scheme follows the Centre increasing tariffs on a range of goods and the Reserve Bank of India easing regulations on raising of money from foreign markets.
Such schemes – they have been used in the past as well – provide a cushion to the value of the rupee by bringing in foreign currency for a stipulated period of time, unlike hot money flows that can move out any time.
To be sure, they also entail an additional cost in terms of interest payments, as they carry a premium vis-à-vis the market rates.
There are three major instances of such a scheme being launched in the post-reform period: the Resurgent India Bonds in 1998, the India Millennium Deposit scheme in 2000 and Foreign Currency Non-resident
OPTIONS SUCH AS NRI DOLLAR DEPOSITS SHOULD BE THE LAST RESORT IN CRISIS MANAGEMENT, AS THEY ENTAIL A HIGH COST
(Bank) Deposit scheme in 2013. These schemes brought in foreign exchange deposits of $4.2 billion, $5.5 billion and $34 billion respectively.
These values amounted to around 12%-13% of the country’s total foreign exchange reserves during those years. If this trend continues, the scheme can be expected to bring in around $50 billion this year, given the fact that current stock of foreign exchange reserves is around $400 billion. India’s foreign currency reserves have gone down by at least $23 billion in the last two quarters.
Since these schemes promise payment in dollars after the maturity period, their fiscal cost depends also on the exchange rate. If the rupee depreciates even more when the deposits mature, the economy will have to bear a greater burden in rupee terms to pay back the promised amount.
The rupee depreciated around 8% between the announcement and maturity of the schemes which were unveiled n 1998 ad 2013. The 2000 scheme was different as the rupee gained 4% vis-à-vis the dollar between announcement and maturity.
Options such as NRI deposits should be the last resort in crisis management on the external front, as they entail a high cost and can at best postpone an imminent balance of payment crisis, if other things do not improve, said Soumya Kanti Ghosh, chief economist at State Bank of India.
Ghosh added that recent developments in the global economy might have reduced the need to go for such a measure.
With global growth forecasts coming down, India might be in for a respite on oil prices, which will provide a cushion to both the rupee and the trade deficit, he said. The rupee has already been showing signs of strengthening in the last few days, Ghosh added.
The rupee closed at 73.47 to the dollar on Tuesday. It has gained 1.37% since touching a low of 74.49 on October 11.