An IDC Analysis from USA


New Delhi, 07 September 2005

There is something amazing about America and Americans and PM Manmohan Singh appears to be on the right lines to team up with Uncle Sam. The UN meets in September to discuss changes and celebrate 60 years of existence and it is reported that the PM will be here. If India plays its cards right (as it did with Russia in the cold war years as there was no other option) and is now doing so with Israel for defence supplies and technology, then Bob’s your uncle.

Vivek Paul (ex-WIPRO) who joined Pacific Texas an investment firm in San Francisco predicts that USA as it ages, will need a million young employees per year. India's aim should be to educate the nation and by 2050 there can be some 20 million Indians in USA –– with closer ties with USA this need not be a pipe dream. It will help poverty alleviation. 

The economy is doing well in USA, real estate is high and huge investment funds have flown in to India, which Indians like Ratan Tata and Bharat Forge owner Baba Kalyani are investing back in USA to buy tea and auto parts companies, bigger than themselves. America lives by innovation and now Indians are following in that vein. The Ratan Tata group Taj took over the Hotel Pierre on Central Park –– 160 rooms in a Co Op Building which Four Seasons could not run well. He has gambled to get cheaper and good Indian staff and tap the Indians who come to USA. We hope the Indian Embassy helps the Taj Group and books without corruption, which is common place in embassies booking hotels and asking for favours. Ambassador Blackwill has been hired to lobby for India and Frank Wisner has been pipped but then that is innovation by the Government.

The deficit in USA is being brushed aside and the oil price rise is creating only a ripple. We learn that USA has propped up the EU and China with massive investments and few realise that or the fact that EU is not doing well economically especially Italy and Germany, and worries on oil price and disagreements on the Constitution have created a rift in the EU. Now India is the destination for US money as it is awash with it. Google wants to raise $4 billion and no eyebrows are raised in USA and that is the power of USA as its IPO shares rose from $180 to $280 in this last year. Bill Gates has $40 billion and he too is investing and helping India.

Our analysis should make it clear that USA still controls most of the world, be it the deals that India will do in advanced technology or nuclear matters or bid for a UN seat, which is a possibility without Veto and so forth. India has got US investors hooked on India and we must deliver as money in India seems to be no problem. Governance and corruption are the problems. A test for India's Command and Control Centre is given below along with an understanding of the World Bank which again USA controls.

Elbit and IAI to bid in $100m Indian Air Force tender

Ran Dagoni, Washington, 24 Aug 05

The tender is likely to test the memorandum signed by Israel and the US 

on arms sales to sensitive countries.

Elbit Systems (Nasdaq: ESLT; TASE: ESLT) and Israel Aircraft Industries (IAI) will be invited to bid in a huge international tender for setting up a command and control system for the Indian Air Force. "Defense News" reported in its latest issue that the system is an ambitious attempt to imitate NATO's command and control network. The tender is for more than $100 million.

The Indian Air Force plans to publish the tender in September. The company chosen will have to help integrate the Indian Air Force's current system in the new system. These existing systems include air defense, control, surveillance systems, a warplane mission management system, and an airspace management system.

Bids and technical specifications must be submitted within three months of the publication of the tender. The Indian Air Force will examine the bids for 4-6 months, and draw up a short list of candidates, from which the winner will be selected. Signing of the contract with the winner is scheduled within a year after the short list is published. The winning company will have to build a prototype of the system two years after the contract is signed.

The tender is likely to serve as a test case for the memorandum signed by Israel and the US on sales of weapons and military systems to sensitive countries. In effect, the document gives the US a veto on Israel's exports of weapons and technology to countries that the US believes constitute a threat to its security, or the security of a given region.

Even though the US administration is mainly concerned about exports of advanced technology to China, senior Israeli defense industry figures warned that the memorandum would strangle Israeli defense exports to Israel's most profitable markets in Asia, including India.

Observers note that the Bush administration recently agreed on nuclear energy cooperation for peaceful uses with India, which will make it difficult for Washington to demand that Israel sever itself from the Indian defense market.


The World Bank Group is a group of five international organisations responsible for providing finance to countries for purposes of development and poverty reduction, and for encouraging and safeguarding international investment.

Together with the separate International Monetary Fund (IMF) (which provides finance to alleviate balance of payments problems), the World Bank organisations are sometimes called the Bretton Woods institutions.

The World Bank Group consists of:

  • the International Bank for Reconstruction and Development (IBRD), established in 1945,

  • the International Finance Corporation (IFC), established in 1956,

  • the International Development Association (IDA), established in 1960,

  • the Multilateral Investment Guarantee Agency (MIGA), established in 1988

  • and  the International Centre for Settlement of Investment Disputes (ICSID), established in 1966 .

Technically the World Bank is part of the United Nations system, but its governance structure is different –– each institution in the World Bank Group is owned by its member governments, which subscribe to its basic share capital, with votes proportional to shareholding. Membership gives certain voting rights that are the same for all countries but there are also additional votes which depend on financial contributions to the organisation.

As a result, the World Bank is controlled primarily by developed countries, while clients have almost exclusively been developing countries. Some critics argue that a different governance structure would take greater account of developing countries' needs. As of November 1, 2004 the United States held 16.4% of total votes, Japan 7.9%, Germany 4.5% and UK and France each held 4.3%. As major decisions require an 85% super-majority, the US can block any change.

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