India-UAE BIPA: Why Such Desperate Haste?     
  by Kavaljit Singh  
  Policy Brief # 2, January 2014  
 
On December 12, 2013, India and the United Arab Emirates signed a bilateral investment promotion agreement. Since India is currently reviewing all its investment protection agreements, the government has not explained why it has worked out an exception with the UAE. Why the government has shown undue haste to sign this agreement when the new model BIPA text is expected to be finalized by January 2014?
 
   
     
  Whither India’s Bilateral Investment Treaty Framework?     
  by Kavaljit Singh  
  Briefing Paper # 15  
 
In the light of several notices invoking provisions of India’s bilateral investment agreements and demanding billions of dollars in compensation, the Indian government decided to put ongoing BIPA negotiations on hold and initiated a review of its model BIPA. The briefing paper critically examines the ongoing review process conducted by bureaucrats with no transparency and wider public consultation. The paper suggests a number of key policy recommendations concerning the design and implementation of a model BIPA. India needs to learn lessons from South Africa which has fundamentally changed its approach towards BIPAs, argues the author.
 
   
     
  South Africa Overhauls its Investment Treaty Regime     
  by Sean Woolfrey  
  Briefing Paper # 14  
 
In November 2013, the South African government introduced Promotion and Protection of Investment Bill as part of an overhaul of the regulatory framework for foreign investment. Based on its review of bilateral investment treaties, the South African government has already terminated many of its existing BITs. Unlike the bilateral treaties, the proposed Bill provides no obligations regarding ‘fair and equitable treatment’ to foreign investors and excludes recourse to international arbitration. After examining various provisions of the proposed legislation, the author concludes that the investment policy overhaul should be commended if the government uses the policy space to enact measures in the public interest.
 
   
     
  Should India Ease Entry Rules for Foreign Banks?     
  by Kavaljit Singh  
  Briefing Paper # 13  
 
On October 12, Raghuram Rajan announced that the Reserve Bank of India will soon issue new rules allowing a more liberal entry of foreign banks in India. While examining the past performance of foreign banks in India, the author contends that the key issue is not xenophobic hostility towards foreign banks but their niche business model devoid of social and developmental banking. Several big international banks including JPMorgan, HSBC and UBS have recently paid billions of dollars in regulatory fines for their alleged role in Libor rate fixing, money laundering and reckless trading. Should India give such banks a free run, asks the author.
 
   
     
  The NSEL Payment Crisis: The Price of Poor Regulation and Supervision     
  by Neeraj Mahajan and Anil Tyagi  
  Briefing Paper # 12  
 
The nearly $1 billion payment crisis at the unregulated National Spot Exchange Ltd is possibly the biggest scandal in the Indian commodity markets of this decade spawned by the combination of a lackadaisical regulatory regime, greedy promoters and easily pliable bureaucrats and politicians. The NSEL payment scandal is a classic case of the failure of regulation and supervision of Indian commodity markets, argue the authors.
 
   
     
  Why is the Indian Rupee Depreciating?     
  by Kavaljit Singh  
  Briefing Paper # 11  
 
The Indian rupee and other emerging market currencies have been hit hard over the prospect of the US Federal Reserve scaling back its policy of quantitative easing. The paper critically examines the key factors behind the sharp depreciation of the rupee and outlines a set of policy recommendations to reduce India's growing vulnerability to external shocks and global liquidity conditions.
 
   
     
  An Open Letter to Prime Minister of India on BIPA with the US     
  by Madhyam  
  7 August 2013  
 
An open letter to Prime Minister Dr. Manmohan Singh urging Indian government to put on hold the negotiations on Bilateral Investment Promotion and Protection Agreement with the United States, particularly in the light of ongoing official review of bilateral investment agreements.
 
   
     
  What is Causing Delay in Implementing Commodity Transaction Tax?     
  by Kavaljit Singh  
  Policy Update # 2  
 
In an apparent policy u-turn, New Delhi has deferred the official notification that will pave the way for the implementation of the long-awaited commodity transaction tax. Consequently, the government is suffering a revenue loss of Rs.50 million per day. The government is backing away from the implementation of CTT due to tremendous pressures exerted by commodity traders and their lobby groups.
 
   
     
  The EU-India Free Trade Agreement: Industry, Traders and Civil Society Raise Concerns     
  by Madhyam  
  Press Release, 12 April 2013  
 
On the eve of the upcoming ministerial level meeting between Indian Commerce Minister and EU Trade Commissioner, industry and civil society groups call on the government to reconsider its decision to sign the EU-India FTA. The ministerial meeting is scheduled to be held in Brussels on April 15 to conclude the trade deal.
 
   
     
  Decoding the Commodity Transaction Tax     
  by Kavaljit Singh  
  Briefing Paper # 10  
 
On February 28, India’s Finance Minister proposed a transaction tax of 0.01 percent on the commodity futures trading. The commodity transaction tax (CTT) would be levied on non-agricultural commodities futures contracts. This paper examines the potential benefits and costs of CTT and debunks several flawed assertions put forward by commodity exchanges, traders and their lobby groups against the proposed tax. The CTT should be part of policy measures to ensure that commodity futures markets function in a fair and orderly manner, says the author.
 
   
     
  Global Trade War over Local Content Requirements     
  by Burghard Ilge and Kavaljit Singh  
  15 February 2013  
 
Global trade wars are looming over the establishment of local content requirements in national law. Nearly two months after Canada lost a case at the World Trade Organization, the US has approached the WTO to challenge the local content requirements in India’s solar power program. This growing trend could have serious implications for India’s new FDI policy on retail trade and other programs intended to encourage domestic manufacturing and job creation.
 
   
     
  Banking on Commodity Derivatives Trading: A Risky Proposition     
  by Kavaljit Singh  
  Briefing Paper # 9  
 
The Indian government is keen to amend the Banking Regulation Act and thereby allowing banks, mutual funds, insurance companies and institutional investors to directly trade in commodity futures markets. The paper analyses the potentially wider ramifications of this hasty move and warns that it could divert resources from developmental banking to speculative trading activities, which may weaken the otherwise stable banking system in the long run.
 
   
     
  Guar Farmers Caught in a Futures Market Gambit     
  by Kavaljit Singh  
 
Thousands of guar farmers in India are today caught in a vicious cycle of debt, regulatory logjam and market economy fuelled by the recent spectacular rise in the prices of guar futures contracts.
 
   
     
  Excessive Speculation and Market Manipulation: The Guar Futures Trading Fiasco     
  by Kavaljit Singh  
  Briefing Paper # 8  
 
The recent guar trading scandal gives a peek into the murky world of Indian commodity futures markets and reveals how commodity exchanges are acting like casinos for speculators, moving away from their avowed objectives of price discovery and price risk management in an efficient and orderly manner.
 
   
     
  More than Bricks and Mortar: A Critical Look at Private Equity Infrastructure Funds     
  by Nicholas Hildyard  
  Discussion Paper  
 
Governments around the world are collaborating with the private sector to constructing the subsidies, fiscal incentives, capital markets, regulatory regimes and other support systems needed to transform “infrastructure” into an asset class from which new investment vehicles (notably private equity funds) are seeking turbo-charged profits. The paper contends that the adverse economic and political consequences for the public good are profound and need challenging urgently.
 
   
     
  Should Banks Be Allowed in Commodity Futures Trading?     
  by Kavaljit Singh  
  Policy Brief on Indian Commodity Markets # 1  
 
The policy brief analyses the recent move by New Delhi to open up futures trading in commodities to banks and other financial players. The arguments supportive of banks’ entry into commodity trading are highly overstated and backed by very little hard evidence. The misguided move could divert scarce resources from developmental banking to risk-prone speculative trading, argues the author.
 
   
     
  Renegotiating India’s Investment Agreements: A Policy Perspective     
  by Prabhash Ranjan  
  Briefing Paper # 7  
 
This briefing paper examines the broad substantive provisions of Indian IIAs and suggests how these broad provisions can be narrowed so as to allow India exercise its regulatory space freely. The paper calls for renegotiating some of the provisions and provide concrete policy suggestions regarding the content of these substantive treaty protections.
 
   
     
  Treaties that Gave Away the Store     
  by Kavaljit Singh  
  The Hindu, April 27, 2012  
 
As India grapples with the Vodafone and 2G fallout, the Bilateral Investment Treaties it signed a few years ago are coming back to haunt it.
 
   
     
  Sistema Threatens to Invoke Bilateral Investment Treaty     
  by Kavaljit Singh  
  29 February 2012  
 
On 28th February, Russian conglomerate Sistema JSFC sent a formal notice to Republic of India threatening international arbitration proceedings under the Bilateral Investment Treaty (BIT) if the government fails to settle the dispute related to revocation of its 21 telecom licences in an amicable way within six months.
 
   
     
  India-EU FTA: Where is the Europe’s Trade Agenda Headed?     
  by Kavaljit Singh  
  23 February 2012  
 
The internal documents of the European Commission reveal the disgraceful attempts to push for higher levels of commitments in trade in industrial goods and agricultural products, services and investment liberalisation, geographical indications and government procurement under the proposed India-EU free trade agreement.
 
   
     
  For a Fair, Free Trade Pact with Europe     
  by Kavaljit Singh  
  The Hindu, February 9, 2012  
 
Several difficult issues need to be resolved if India is not to be short-changed in the Bilateral Trade and Investment Agreement with the EU.
 
   
     
  FDI Policy in Multi-brand Retail Favors the Big Multinationals     
  by Shekar Swamy  
  6 December 2011  
 
On 24 November 2011, the Indian government approved 51 percent FDI in multi-brand retail stores and 100 percent in single brand outlets in its $450 billion retail market. This article challenges the premises behind the new policy framework and the proposed guidelines.
 
   
     
  Should India Establish a Sovereign Wealth Fund?     
  by Kavaljit Singh  
  Briefing Paper # 6  
 
New Delhi will soon decide on the issue of setting up of a sovereign wealth fund. This paper questions the rationale behind the policy proposal as the necessary preconditions for setting up such a fund are missing in India.
 
   
     
  Weak Position Limits Cannot Tackle Speculation in Commodities     
  by Kavaljit Singh  
  19 October 2011  
 
On 18 October 2011, the US Commodity Futures Trading Commission approved new rules to limit traders’ positions on 28 physical commodity futures and swaps contracts. By pointing out several lacunas in the new rules, the author contends that such measures will not curb excessive speculation and market concentration in the US commodity derivatives markets.
 
   
     
  G20 Defers Decision on FTT Despite Global Support     
  by Kavaljit Singh  
  17 October 2011  
 
The G20 finance ministers and central bankers have put off an immediate decision to weigh up a global financial transaction tax (FTT) proposal at the forthcoming G20 Cannes Summit. The communiqué issued at the Paris meeting makes no reference to the importance and urgency of a global FTT. By purposely not mentioning it in the communiqué, the opponents (particularly Canada and US) have managed to influence other G20 nations to delay the discussions on the proposed tax for almost a year, thereby weakening the political momentum generated on this important issue in the past few years.
 
   
     
  Why We Need a Financial Transaction Tax: A Proposal for the G20     
  by Kavaljit Singh  
  Briefing Paper # 5  
 
One of the key policy issues to be tackled at the forthcoming G20 Summit (Cannes, 3-4 November 2011) is the introduction of a global financial transaction tax (FTT). The paper examines recent developments and intense power play among G20 nations on this issue. It also reveals how India has dramatically shifted its stance on a global FTT in recent years. The author calls upon G20 leaders to endorse a FTT in the spirit of building international cooperation on global financial reforms.
 
   
     
  Protecting Investors’ Rights: An Assessment of EU’s New Mandate on International Investments     
  by Burghard Ilge and Kavaljit Singh  
  Briefing Paper # 4  
 
An analysis of the recently leaked EU’s negotiating mandate for investment protection measures under the proposed free trade agreements with India, Singapore and Canada. The authors contend that by approving such a lop-sided negotiating mandate, the European member-states have lost an opportunity to achieve a greater balance between investors’ rights and host government policy space.
 
   
     
  The Pitfalls of FDI in Multi-Brand Retailing in India     
  by Shekar Swamy  
  Briefing Paper # 3  
 
This paper critically examines the benefits of foreign direct investment in multi-brand retail trade in India. Drawing from international experiences, the author argues that the big retail business is a game of market concentration and domination. The paper delineates some of the long-term negative effects on the self-organized retail industry in India.
 
   
     
  Eurozone Bailout: Taxpayer Transfer to the Wealthy?     
  by Harald Hau  
 
On July 22, 2011, the European heads of government added €109 billion to the existing €110 billion rescue plan for Greece. As Europe’s financial sector would have otherwise taken a huge hit, this article addresses the question: How did the financial sector manage to negotiate such a gigantic wealth transfer from the Eurozone taxpayer and the IMF to the richest 5% of people in the world?
 
   
     
  South Korea's Experience with Banking Sector Liberalisation     
  by Hyekyung Cho  
  Research Report Jointly Published by Madhyam and SOMO  
 
In this case study, the strong linkages between financial liberalisation and financial crises in South Korea as well as the important role played by external actors (particularly the IMF and the OECD) in pushing unbridled financial liberalisation are documented. Key developments in the Korean banking sector before and after the 1997 financial crisis are analysed.

The study also provides a critical understanding of the interplay between state, big business and foreign financial investors (including foreign banks) in shaping the landscape of Korean financial system.
 
   
     
  Banking Sector Liberalisation in Uganda: Process, Results and Policy Options     
  by Lawrence Bategeka and Luka Jovita Okumu  
  Research Report Jointly Published by Madhyam and SOMO  
 
This study critically examines the major developments in the banking sector in Uganda over the past two decades. In particular, the study documents the outcomes of banking sector liberalization policies which were initiated since the early 1990s. It also deals with recent developments in the Ugandan banking sector in the aftermath of global financial crisis.

With a special focus on the entry of foreign banks, the study assesses the major impacts and consequences of market-led banking reforms on economy, development and poverty eradication. It examines the large presence of foreign banks with particular attention on access to credit to poor people, small and medium enterprises, rural and informal economy.

The findings of this study are relevant in the light of increased foreign ownership of domestic banks and financial institutions in many poor and developing countries. From a host country perspective, the study raises several policy-oriented issues related to the entry of foreign banks in the developing world. It highlights several adverse impacts of foreign bank entry which are not given due attention in policy and academic circles.
 
   
     
  The India-EU FTA and its Implications on India’s Food and Farm Sector     
  by Shalini Bhutani  
  Factsheet # 1  
 
This factsheet is written in an easy to understand style. It succinctly brings together various concerns over the proposed India-EU free trade agreement for India’s food and farm sector. The author exposes the inherent dangers of ‘free trade’ agenda pushed by corporate agribusiness under the aegis of India-EU FTA. It closes with a call for action and relevant resources for further information.
 
   
     
  NEW BOOK

Fixing Global Finance: A Developing Country Perspective on Global Financial Reforms

FREE TO DOWNLOAD FOR A LIMITED PERIOD!   
 
  by Kavaljit Singh  
 
The financial crisis which erupted in mid-2007 has been widely viewed as the most serious financial crisis since the Great Depression of the 1930s. The crisis which originated in developed countries quickly spread to developing countries and the rest of the world. The turbulence in financial systems was followed by a significant reduction in real economic activity throughout the world. The crisis has highlighted that financial markets are inherently unstable and market failures have huge economic and social costs. The crisis has renewed debate on the role of global finance and how it should be regulated.

The aim of this book is to encourage and stimulate a more informed debate on reforming the global finance. It examines recent developments and problems afflicting the global financial system. From a developing country perspective, it enunciates guiding principles and offers concrete policy measures to create a more stable, equitable and sustainable global financial system. Several innovative measures have been proposed to reform the global finance and to ensure that it serves the real economy.

“The book is an outstanding contribution to the literature on global financial crisis. It is objective, sensitive, sensible, scholarly and yet eminently readable, with unique focus on developing countries. It should be a compulsory reading for policy makers and market participants.” –
Dr. Y. V. Reddy, Governor, Reserve Bank of India (2003-08).

"This book takes a heterodox view of current issues on the current crisis and international financial architecture. From a different diagnosis of the international problems facing global finance to a review of the differentiated impact of the financial crisis on India, it is very knowledgeable and profound. It gives insights from a developing country angle that are very important for international reforms. Swift, well written and sharp, it is a stepping stone toward further discussions on reform of the international financial system." - Dr Oscar Ugarteche, Instituto de Investigaciones Económicas, UNAM, México City.

"The cardinal principle that Kavaljit Singh would have everyone remember is that 'financial stability is a global public good' and a voice should therefore be given to developing countries at international forums. His overarching idea is that there should be a 'new deal' which will outline the path of global financial reforms through a process of democratic renewal." - Subir Roy, Civil Society.
 
   
     
  Fixing Global Finance     
  by Kavaljit Singh  
  EPUB Format  
 
You can download this book in EPUB format for use on eBook Readers such as iPad, iPhone, Kobo, Nook, BeBook, Sony Reader and many others.
 
   
     
  India-EU FTA: Policy Implications of Unfettered Investment Flows     
  by Kavaljit Singh  
  Briefing Paper # 2  
 
An in-depth analysis of recommendations on investment issues by European Commission under the proposed FTA with India. The recommendations contain several controversial provisions including grant of national treatment, removal of restrictions on performance requirements, free transfer of capital and investment-related returns, and investor-to-state dispute settlement mechanisms.
 
   
     
  India-EU FTA: Rethinking Banking Services Liberalization     
  by Kavaljit Singh  
  Briefing Paper # 1  
 
This paper critically examines the potential costs and benefits of liberalization of trade and investments in banking services under the proposed India-EU FTA. The paper calls upon trade negotiators to rethink the policy framework and objectives of opening up India’s banking sector, particularly in the light of current global financial crisis.
 
   
     
  India-EU FTA: Grave Implications of Unrestrained Investments     
  by Kavaljit Singh  
 
Under the proposed India-EU free trade agreement, the European Commission (EC) has sought an expansive mandate to negotiate on investment issues on the behalf of the European Union. On January 20, 2011, the EC officially made recommendations to the European Council seeking modifications in the negotiating directives for the trade agreement with India. If these recommendations are accepted, the EC would pursue comprehensive cross-border investment liberalization and protection provisions under the proposed free trade agreement with India.
 
   
     
  Taming the "Wild West" of Microfinance     
  by Kavaljit Singh  
 
The recent suicides by over 60 poor borrowers in Andhra Pradesh have brought the operations of microfinance institutions (MFIs) under public scrutiny. These debt-driven suicides were due to coercive methods of loan recovery used by commercial MFIs. It is high time that big commercial players realize that the “Wild West” period of microfinance is over.
 
   
     
  ECAs Strive to Meet New Demand     
  by Kavaljit Singh  
  Global Trade Review (November-December 2010)  
 
As public institutions, export credit agencies face a difficult task in the post-crisis period as they learn how to balance their enhanced role and legitimacy with greater public responsibility and accountability. Post-crisis, undertaking the unfinished reforms and integrating social and environmental concerns in policy frameworks should acquire even greater urgency.
 
   
     
  Will G20 Take Collective Stand on Capital Controls?     
  by Kavaljit Singh  
  The Korea Times  
 
The issue of capital controls has never been under discussion at G20 despite many member countries (from South Korea to India to Brazil) currently using a variety of such controls. Given its long history of successfully using capital controls in conjunction with other policy measures, South Korea should take a lead in putting this substantive issue on the agenda of G20.
 
   
     
  A Question of Sovereignty: Capital Controls Gain Credence     
  by Kavaljit Singh  
  Journal of Regulation and Risk North Asia  
 
Post-crisis, there is a renewed interest in capital controls (on both inflows and outflows) as a policy response to deter short-term volatile capital flows…
 
   
     
  Should India Set Up a Sovereign Wealth Fund?     
  by Kavaljit Singh  
  The Hindu Business Line  
 
New Delhi's proposal to establish a $10-billion sovereign wealth fund should be treated with caution. The necessary preconditions for setting up a SWF are squarely lacking in India. Besides, the purported objectives of the fund to pursue strategic investment opportunities abroad are highly debatable.
 
   
     
  Emerging Markets Consider Capital Controls to Regulate Speculative Capital Flows     
  by Kavaljit Singh  
 
Just days before the G20 summit in Toronto, South Korea and Indonesia announced several policy measures to regulate potentially destabilising capital flows which could pose a threat to their economies and financial systems. The policy measures announced by South Korea and Indonesia assume greater significance because both countries are members of the G20.
 
   
     
  Indonesia Moves to Tame Speculative Capital Flows     
  by Kavaljit Singh  
 
On June 16, 2010, Indonesia (a member of G-20) unveiled several policy measures to regulate potentially destabilizing capital flows.

The policy announcements by Indonesia is the latest initiative by emerging markets to tame speculative money which could pose a threat to their economies and financial systems.
 
   
     
  South Korea Imposes Currency Controls for Financial Stability     
  by Kavaljit Singh  
 
On June 13, 2010, South Korea announced a series of currency controls to protect its economy from external shocks. The currency controls are specifically aimed at regulating capital flows and stabilizing its currency.

In the present uncertain times, imposition of capital controls becomes imperative since the regulatory mechanisms to deal with capital flows are national whereas the financial markets operate at a global scale.
 
   
     
  Microfinance: Profiting from the Poor     
  by Kavaljit Singh  
 
The massive investments by private equity firms coupled with an IPO by a leading microfinance institution (MFI) have ignited a debate about the ethics and objectives of MFIs in India.

As the numbers of MFIs in India multiply, a proper regulatory framework must be developed to ensure that these institutions follow minimum norms and standards. Otherwise, MFIs may simply end up as an exploitative form of organized money lending with no public responsibility and accountability.

Rather than becoming institutional moneylenders, MFIs should give a strong competition to traditional moneylenders in India.
 
   
     
  Free India from Hunger First     
  by Kavaljit Singh  
  Financial Times  
 
Letter to the Editor: For New Delhi, the first priority should be to free the nation from hunger, malnutrition and illiteracy rather than financing the acquisition of companies and assets abroad.
 
   
     
  The Changing Landscape of Export Credit Agencies in the Context of the Global Financial Crisis     
  by Kavaljit Singh  
 
With the onset of the global financial crisis and the subsequent squeeze in credit and insurance markets, there is a renewed global demand for export credit and investment insurance products offered by ECAs.

The current financial crisis has given ECAs a new life and offered the opportunity to reassert their position as dominant players in the trade finance markets.

This report describes the changing landscape of ECAs in the context of the global financial crisis and the collapse of trade finance markets, and urges civil society actors to be watchful and monitor developments closely.
 
   
     
  Rethinking Liberalisation of Banking Services under the India-EU Free Trade Agreement     
  by Kavaljit Singh and Myriam Vander Stichele  
 
This paper critically examines the potential costs and benefits of liberalization of trade and investments in banking services under the proposed India-EU FTA. The paper calls for rethinking on banking services liberalization particularly in the light of current global financial crisis.
 
   
     
  India-EU FTA:

Should Delhi Open Up Its Banking Sector?   
 
  by Kavaljit Singh  
  Bangkok Post  
 
A two-part series on the impact and implications of a liberal entry of EU-based banks in India under the proposed framework of India-EU Free Trade Agreement.
 
   
     
  Special Report
India-EU Free Trade Agreement: Should India Open Up Banking Sector?   
 
  by Kavaljit Singh  
 
Since 2007, India and European Union (EU) are negotiating a free trade agreement (FTA). The negotiations not only cover trade in goods but also services, rules pertaining to intellectual property rights, cross-border investments, competition policy, government procurement and regulatory issues. One of the key themes under negotiation is the liberalization of cross-border trade and investment in banking services.

The 70-page Special Report questions the policy framework and objectives of opening up banking sector under the FTA. The report argues that the liberal entry of European banks is likely to further constrict the access of banking services in the country: geographically, socially and functionally. The report reveals that urban-centric European banks are primarily interested in serving three niche market segments in India: up-market consumer retail finance, wealth management services and investment banking. Not a single EU-based bank has opened a branch in the rural areas despite several of them (including Standard Chartered, BNP Paribas and HSBC) have been operating in India for more than 140 years, points out the report.

With the help of statistical data and case-studies, the report debunks several myths associated with the higher efficiency and productivity levels of foreign banks in India. It also debunks the popular conception that foreign banks are discriminated in India. The report observes that no reciprocity in market access has been observed in other trade agreements signed by India.

The report documents important developments in the Indian banking sector since Independence and maps out several disturbing trends (such as growing financial exclusion, decline in bank lending to agriculture and small enterprises, etc.) in the post-liberalization period.

The report questions the much-touted benefits of opening up banking sector under the India-EU FTA. Are big European banks going to augment the reach of the banking system to millions of Indians citizens who have no access to basic banking services? What specialization and experience do European banks have when it comes to providing basic banking services to landless rural workers and urban poor dwellers? Will the India-EU FTA reduce the domestic regulatory space?

In the wake of severe crisis gripping many European banks, the report calls upon trade negotiators to rethink about opening up banking sector under the FTA.
 
   
     
  Reciprocal Terms Missing in the Proposed India-EU Pact     
  by Kavaljit Singh  
  The Economic Times  
 
One of the key policy issues determining market access is reciprocity. How much market access Indian banks would get in return?
 
   
     
  Sovereign Wealth Funds and Land Grabbing     
  by Kavaljit Singh  
 
Are sovereign wealth funds involved in colonial-type agricultural land grabbing deals? Will SWFs buy agricultural lands in the future as many of them originate from food importing countries? How to approach SWFs?
 
   
     
  The Global Financial Crisis is a Systemic Crisis of Capitalism     
  by Kavaljit Singh  
 
Extracts from presentations made at expert meeting and Crisis Café ('De Duurzame Daalder') organized by Both Ends at The Hague on March 25, 2009.
 
   
     
  Europe Doesn’t Need Sovereign Wealth Funds     
  by Kavaljit Singh  
  VoxEU.org  
 
French President Nicholas Sarkozy has proposed that European nations create sovereign wealth funds to protect national companies from foreign “predators.” This column says that idea is protectionist and without merit. Emerging economies establish sovereign wealth funds to invest foreign reserves or commodity revenue – not to bail out domestic firms and stifle global competition.
 
   
     
  Majority of SWFs are passive, and patient, investors     
  by Kavaljit Singh  
  Financial Times  
 
A Letter to Editor.
 
   
     
  SWFs mark structural shift in world financial order     
  by Kavaljit Singh  
  The Economic Times  
 
On October 11, the International Working Group of Sovereign Wealth Funds (IWG) released the Generally Accepted Principles and Practices (GAPP) that would guide the governance and accountability framework of sovereign wealth funds.
 
   
     
  Norway's oil riches and the Dongria Kondh     
  by Kavaljit Singh  
  International Herald Tribune  
 
On Nov. 19, the Norwegian Embassy in New Delhi received some unusual visitors. The visitors were Indian citizens, but ethnically they belonged to a distinct tribal minority group called Dongria Kondh.
 
   
     
  Frequently Asked Questions About Sovereign Wealth Funds     
  by Kavaljit Singh  
 
Western politicians, business leaders and commentators seem paranoid about state-owned sovereign wealth funds (SWFs), particularly those from the Middle East and China. They fear that SWFs follow strategic political objectives -- investing in Western companies and banks to secure control of strategically important industries such as telecommunications, energy and banking - rather than commercial interests.

A protectionist backlash against sovereign wealth funds is fast emerging: the US, Canada, Australia and Germany have introduced substantial legislative changes to screen and restrict investments by SWFs and other state-owned entities. European Parliaments are considering regulations to curb the potential impact of SWFs on financial markets, corporate governance and security.

Are such fears based on facts or assumptions? Is the "invasion of sovereign wealth funds" real? Do SWFs pose a direct threat to financial stability? Do they have hidden agendas? Are SWFs driven by political considerations? Are governments really using SWFs to pursue nefarious foreign policy objectives? Should anyone be afraid of sovereign wealth funds? Are SWFs providing long-term investments and stability to ailing businesses and economies?

This paper examines these questions in order to understand the potential impact and implications of sovereign wealth funds in a rapidly-changing global political economy.


 
   
     
  Taking it Private:
Consequences of the Global Growth of Private Equity   
 
  by Kavaljit Singh  
 
During the last two decades, private equity became an integral component of the world's financial system at a time when financial markets overshadowed the productive economy. Private equity was invariably behind the multi-billion buyout deals, and mergers and acquisitions that swept across the US and Europe, creating a new type of corporate conglomerate that is reshaping the way business is conducted.

Insofar as it constitutes a new form of corporate ownership, private equity poses new challenges to labour unions, NGOs and community groups because it has a significant and distinctive influence on taxation policy, corporate governance, labour rights and public services, and thus deeply affects society, human rights and environment alike.

These challenges are especially clear in Asia, which has become more attractive for private equity firms since mid-2007 when the "credit crunch" took hold and diminished the scope for the huge deals in Europe and North America.

This paper looks at the global growth of private equity and its social, environmental and political impacts, using India as a case study of its growing importance in Southern countries. It concludes with an outline of private equity's vulnerabilities that may provide opportunities for public concerns to be addressed.
 
   
     
  Debate on Financial Services Liberalization     
  by Kavaljit Singh  
  The debate on financial services liberalization in the “Letters” section of Financial Times.  
 
“Give priority to financial services,” Stephen Wright, Chief Executive; John Cooke, Chairman, Liberalisation of Trade in Services Committee, International Financial Services London, Financial Times, July 22, 2008.

“Entry of big foreign banks has not widened access to include India's poor,” Kavaljit Singh, Financial Times, July 29, 2008.

“Further liberalisation can widen India's banking system,” Roger Brown, Executive Director, British Bankers' Association, London, Financial Times, August 5, 2008.

“Indian banks denied market reciprocity,” Kavaljit Singh, Financial Times, August 6, 2008.
 
   
     
  Norwegian Medicine for Vedanta     
  by Kavaljit Singh  
  Civil Society  
 
Should one welcome the decision by the Norwegian sovereign fund to sell off its stake in Vedanta Resources? The answer is an affirmative “Yes.” If globalization can facilitate the movement of capital, goods and services across borders, the same instrument could also be used to build alliances and solidarity with like-minded groups across the borders to resist destructive projects and investment flows. This episode has shown the potential influence of shareholder activism in punishing bad corporations. It has opened up new avenues for grassroot activists and groups to influence corporate behavior.
 
   
     
  Norway’s Sovereign Wealth Fund to Invest in India     
  by Kavaljit Singh  
 
The recent decision by Norway’s Government Pension Fund–Global (GPF) to invest $2 billion in Indian markets has come at a time when most foreign institutional investors are fleeing the markets.
 
   
     
  Private Equity, Indian Investments and Extractive Industry     
  by Kavaljit Singh  
 
Before the global credit crunch hit the markets in mid-2007, newspapers and news channels on television were full of stories about another fascinating multi-billion private equity (PE) deal. More and more companies were willing to go private.
 
   
     
  The Dark Side of Private Equity Funds     
  by Kavaljit Singh  
 
Year 2007 was a gala one for private equity (PE) investments in India. During the year, the total number of PE deals stood at 386 with a value of US$17 billion, as compared to 302 deals with a value of $7 billion in 2006. The private equity firms are investing in a range of businesses in India including infrastructure, telecom, financial services, healthcare and real estate sectors. It would not be incorrect to say that private equity has become the latest fad in the investment game.
 
   
     
  Watchful States Keep Firms in Check     
  by Kavaljit Singh  
 
Prime Minister Manmohan Singh’s sermon on inclusive growth at an annual summit of the Confederation of Indian Industry (CII) evoked sharp reactions from the corporate world and media. Most comments were aimed at resisting the enforcement of a Ten-Point Social Charter spelt out by the Prime Minister. “The government cannot legislate CEO salaries,” was industry’s common refrain. This is nothing but a complete misreading of the Social Charter because it nowhere hints at curbing excessive remuneration or eschewing conspicuous consumption through regulatory and legislative measures. And, to my mind, that is a big problem with the Social Charter.
 
   
     
  The Growing Abuse of Transfer Pricing by TNCs     
  by Kavaljit Singh  
 
The large-scale tax avoidance practices used by transnational corporations (TNCs) came into public notice recently when the giant drug TNC, GlaxoSmithKline, agreed to pay the US government $3.4 billion to settle a long-running dispute over its tax dealings between the UK parent company and its American subsidiary. This was the largest settlement of a tax dispute in the US.
 
   
     
  Southern Transnationals:
The New Kids on the Block?   
 
  by Kavaljit Singh  
 
The mid-1990s witnessed the dramatic emergence of transnational corporations from the developing world. Although much of the investment by these corporations is concentrated in other developing countries (South-South), they are increasingly investing heavily in developed countries (South-North) as well. The South-South and South-North FDI flows are growing much faster than the traditional North-South FDI flows.
 
   
     
  International Investments:
Is the Pendulum Swinging Back?   
 
  by Kavaljit Singh  
 
Despite the dominant trend towards greater liberalization of investment flows, certain kinds of investments have come under closer scrutiny by policy makers. In several countries (both developed and developing), there are moves to tighten existing investment rules or to enact new rules to regulate foreign investments and protect “strategic sectors” from foreign investors.
 
   
     
  Banking Sector Liberalization in India: Some Disturbing Trends     
  by Kavaljit Singh  
 
If 391 districts out of a total 602 districts in India are under-banked, it raises several policy issues which cannot be suppressed by keeping public in dark about the ground realities of the banking sector. On the contrary, such an anomaly could only be addressed through wider public consultation and debate.
 
   
     
  Entry of Foreign Banks in India and China: A Brief Note     
  by Kavaljit Singh  
 
The proponents of banking sector liberalization claim that the entry of foreign banks in the poor and developing world is highly desirable and beneficial. But recent empirical evidence suggests that the entry of foreign banks could lead to misallocation of credit, which in turn could negatively affect economic growth prospects as bank credit is a vital input for investment and growth. As the focus of the global banking industry appears to be on India and China, this note analyses some of the recent developments taking place in these countries.
 
   
     
  ASED-PIRC Briefing Paper

Tax Financial Speculation:
The Case for a Securities Transaction Tax in India   
 
  by Kavaljit Singh  
 
Indian financial markets are among the most speculative and volatile in the world. To curb unproductive speculation and excessive volatility, the author proposes a Securities Transaction Tax (STT) of 0.25 per cent. The author argues that the wider economic
and developmental gains of taxing speculative money in stock markets are more than the private gains of a handful of speculators, financiers and traders. The paper provides legitimate grounds for imposing a STT on Indian financial markets. It underscores the point that the obstacles to put restrictions on speculative trading are not technical,
but political. The author calls upon policy makers to closely examine the proposal of a STT.
 
   
     
  Equitable Equity:
India Introduces Securities Transaction Tax   
 
  by Kavaljit Singh  
  Mainstream  
 
July 24, 2004

On July 8, 2004, India's Finance Minister, P. Chidambaram, presented Finance Bill in Parliament in which he proposed the introduction of Securities Transaction Tax (STT) in the Indian financial markets.
 
   
     
  Bonanza for Speculators:
Securities Transaction Tax Turned Over   
 
  by Kavaljit Singh  
  Mainstream  
 
August 14, 2004
Under pressure from powerful lobby of brokers, speculators, arbitrageurs and “noise traders,” Finance Minister, P. Chidambaram, diluted several important provisions of the proposed securities transaction tax (STT).
 
   
     
  Securities Transaction Tax Disproves All Fears     
  by Kavaljit Singh  
 
On October 1, 2004, the Securities Transaction Tax (STT) came into implementation in the Indian financial markets. The market players and analysts who had predicted that the introduction of STT would bring Indian financial markets to a standstill have been proved completely wrong.
 
   
     
  Trading Away Capital Controls under Bilateral Trade Agreements     
  by Kavaljit Singh  
 
The move by the US to curb the use of capital controls under the bilateral trade agreements with Chile and Singapore has not received adequate attention. The fact that Chile and Singapore have agreed to surrender the use of capital controls in return for more favorable market access should set the alarm bells ringing. If bilateral trade deals banning capital controls become de rigueur it means a country using them to defend its economy will end up compensating American investors for the inconvenience.
 
   
     
  APRN-PIRC Briefing Paper
Multilateral Investment Agreement in the WTO: Issues and Illusions   
 
  by Kavaljit Singh  
 
An in-depth investigation of attempts made by a select grouping of developed world to widen the scope of trade negotiations to new issues, particularly investments, at the Fifth Ministerial Conference of the World Trade Organization (WTO) held at Cancun, Mexico in September 2003.
 
   
     
  Keep Investment Pacts off Cancun's Agenda     
  by Kavaljit Singh  
  Financial Times  
 
July 7 2003

A commentary on the attempts made by the European Union, Japan and Canada to push negotiations for a multilateral investment agreement at the World Trade Organisation meeting in Cancun in September 2003.
 
   
     
  Debate in Financial Times on Investment Issues     
  by Kavaljit Singh  
 
The above FT article provoked sharp reactions from International Chamber of Commerce and many others. Here are the exchanges published in the FT.
 
   
     
  A Discussion Paper on Aid and Good Governance     
  by Kavaljit Singh  
 
In recent times, the terms ‘governance’ and ‘good governance’ have become buzzwords in the development discourse. Pushed by powerful international financial institutions, ‘good governance’ has become the cornerstone of development cooperation. Nowadays it is difficult to come across aid packages of multilateral financial institutions and bilateral donors that do not use the term ‘good governance’ and contain ‘governance’ conditionalities. This paper critically examines the emergence of “good governance” agenda and exposes some of the myths espoused by the development aid community.
 
   
     
  ASED-PIRC Briefing Paper
Global Corporate Power: Emerging Trends and Issues   
 
  by Kavaljit Singh  
 
In the last two decades, economic clout of global corporations has scaled unprecented heights. Does this suggest the end of nation-states? Not at all, says the author. With the help of contemporary examples, the author argues that the role of state has been critical in shaping the present trajectory of corporate-led global economy. The paper critically examines in detail two most controversial and complex issues related to TNCs namely, mergers and aquisitions and transfer pricing. The author calls upon anti-corporate activists and movements to rethink their strategies in order to address new challenges posed by corporate-led globalization.
 
   
     
  Banking on Wolfowitz     
  by Kavaljit Singh  
 
On March 31, 2005, Paul D. Wolfowitz was appointed as President of the World Bank. The appointment of Mr. Wolfowitz shows the poor governance norms practiced by a few powerful member-countries in the running of multilateral institutions. If the President of World Bank is selected by such secret and undemocratic means, it becomes imperative for the Bank to follows its own dictum of “good governance” and “institutional building” before preaching it to the poor and developing world.
 
   
     
  Citi Never Sleeps     
  by Kavaljit Singh  
 
On August 2, 2004, Citigroup traders sold euro-denominated government bonds worth Euro 12.4 billion in less than two minutes, only to buy back bonds worth Euro 3.7 billion at lower prices few minutes later. In the process, Citigroup traders made a handsome profit of Euro 13 million but triggered sharp movements and uncertainty in the bond futures market. A classic example of casino capitalism!
 
   
     
  Speculating on Black Gold     
  by Kavaljit Singh  
 
Since early 2004, international crude oil prices have witnessed a massive upsurge. What contributed to the sudden rise in oil prices? Is it the result of demand or supply factors or
rampant speculation in oil futures markets?
 
   
     
  Cancun Conundrum     
  by Kavaljit Singh  
 
The Fifth Ministerial Conference of World Trade Organization (WTO) held in Cancun during September 10-14, 2003, failed to arrive at any agreement on several contentious issues. Since Cancun Conference was expected to provide a further push to the Doha Round, both the proponents and critics were apprehensive about its outcome. But the way Ministerial Conference collapsed at Cancun has surprised everyone.
 
   
     
  Parmalat’s Fall: Europe’s Enron?     
  by Kavaljit Singh  
 
In December 2003, Italian food and dairy giant, Parmalat, went bust. The dramatic fall of
family-owned Parmalat was triggered when Bank of America claimed that a document
showing 4 billion Euro in company’s Cayman Islands bank account is forged.
 
   
     
  The Globalization of “Locusts”     
  by Kavaljit Singh  
 
The short-term profit-maximizing strategies of private equity funds have received considerable public criticism. A senior German politician described private equity funds and hedge funds as “swarms of locusts that fall on companies, stripping them bare before moving on.” He told a German newspaper that “some financial investors don't waste any thoughts on the people whose jobs they destroy.”
 
   
     
  How to Lose Millions in Speculative Currency Trading     
  by Kavaljit Singh  
 
Australia's largest bank, National Australia Bank (NAB), lost hundreds of millions of dollars in speculative currency trading. The scandal broke out in January 2004 when a fellow trader working in the Melbourne office of the bank exposed unauthorized foreign currency derivatives trading.
 
   
     
  Trade Wars over Atlantic     
  by Kavaljit Singh  
 
On November 11, 2003, the World Trade Organization (WTO) issued an important verdict confirming that heavy import duties imposed on steel products by the US violate trade rules.
 
   
     
  Briefing Paper
War Profiteering: Anthrax, Drug Transnationals and TRIPs   
 
  by Kavaljit Singh  
 
Against the backdrop of September 11th terrorist attacks in the US, the anthrax crisis raised highly controversial issues related to intellectual property rights. Not long ago, the world witnessed heated debate on the patent controversy when the leading drug companies took the South African government to court to prevent it from importing cheaper versions of patented drugs for patients suffering from AIDS.
 
   
     
  Briefing Paper
Patents vs. Patients: AIDS, TNCs and Drug Price Wars   
 
  by Kavaljit Singh  
 
The lawsuit filed by drug transnational corporations’ association against the South African government has clearly exposed how TRIPS and the concomitant patent regime can adversely affect the lives of AIDS patients in the poor and the developing world. Universal health programs and other public funded interventions notwithstanding, it is also necessary that monopolies in the drug industry be dismantled so as to ensure that crucial drugs are made accessible to the poor patients at affordable price.
 
   
     
  Turkey: Limping From One Financial Crisis to Another (I)     
  by Kavaljit Singh  
 
A commentary on the series of financial crises faced by Turkey since 2000.
 
   
     
  Turkey: Limping From One Financial Crisis to Another (II)     
  by Kavaljit Singh  
 
 
   
     
  The Never Ending Story of Coke’s Divestment (I)     
  by Kavaljit Singh  
 
A three-part commentary on how Coke made a mockery of disinvestment provisions by denying voting rights to the Indian shareholders.
 
   
     
  The Never Ending Story of Coke’s Divestment (II)     
  by Kavaljit Singh  
 
 
   
     
  The Never Ending Story of Coke’s Divestment (III)     
  by Kavaljit Singh  
 
 
   
     
  Is Foreign Direct Investment a Panacea?     
  by Kavaljit Singh  
 
World Investment Report has become one of the strong proponents of the liberalization of foreign direct investment in the developing world. However, the hard-selling of FDI is often based on several myths. FDI is not a panacea. There is no country in the world which has developed solely on the basis of FDI flows.
 
   
     
  The Enron Debacle     
  by Kavaljit Singh  
 
An analysis of how Houston-based Enron Corporation became victim of its own contradictions and large-scale fraudulent practices by its top management.
 
   
     
  The World Bank as the New Evangelist:
Rhetoric and Reality behind Bank’s New Concern for the Poor   
 
  by Kavaljit Singh  
 
After lending billions of dollars in supporting neo-liberal adjustment programs in over 100 countries, the World Bank is nowadays reinventing itself as an anti-poverty crusader. By suddenly espousing the cause of the poor, the Bank has not just shocked the global financial community but also its die-hard critics who had never anticipated that much of their lexicon such as “empowerment,” “governance,” “decentralization,” “microcredit” and “transparency” would soon become buzzwords at the Bank.
 
   
     
  Microcredit Myths: No Lending Hand for the Poor     
  by Kavaljit Singh  
 
Historically, women’s groups and NGOs initiated microcredit programmes as one component of the development strategy to empower poor women. But nowadays microcredit offers new avenues of profit-making since interest rates range from 20 to 40 per cent and repayment rates are over 90 per cent, far above commercial lending. This economic logic makes the poor more attractive to banks and financial institutions, but not vice-versa.
 
   
     
  Women's Empowerment and the New World of Microcredit Evangelism     
  by Kavaljit Singh  
 
In the development circles, microcredit has become the buzzword. Advocates of microcredit often perceive it as a panacea for poverty alleviation. The recent trends indicate that microcredit programs are moving away from ‘development as
charity’ model to more profitable ‘development as business’.
 
   
     
  Financial Frauds and Market Crashes: Casino Capitalism Indian-style     
  by Kavaljit Singh  
 
In March 2001, a massive scam broke out in Indian financial markets which wiped out US$32 billion in market capitalization. The market analysts have called the market crash the first “Black Friday” of the millennium. This briefing paper provides an in-depth analysis of the scam and the resultant market crash.
 
   
     
  From Beijing Consensus to Washington Consensus (II)

China’s Financial Sector under the WTO Regime: A Preliminary Assessment

  
 
  by Kavaljit Singh  
  December 2002  
 
China became a member of the World Trade Organization (WTO) on 11 December 2001. To facilitate its entry into WTO, China agreed to undertake a series of important market access commitments to open and liberalize its financial sector.

These commitments will allow foreign banks to capture markets in those regions (e.g., coastal regions and cities) where bulk of banking business is concentrated. Given the fact that foreign banks have considerable international exposure and can launch new products and services, they are in a better position to capture China’s banking markets, particularly the highly lucrative trade-related businesses.

In this sequential paper, the author assesses the potential benefits and costs of financial sector reforms in China under the WTO mandated timetable.
 
   
     
  From Beijing Consensus to Washington Consensus:

China’s Journey to Liberalization and Globalization


  
 
  by Kavaljit Singh  
  Asia-Pacific Journal, Issue No.7, December 2002  
 
China’s massive transformation from a centrally planned economy to a market economy has received worldwide attention. There is a strong tendency among many commentators to equate China’s economic liberalization program with neoliberal Washington Consensus based on rapid privatization, deregulation and globalization policies. It would be erroneous to equate Chinese journey towards economic reforms with Washington Consensus because the country followed a sequential approach to economic liberalization rather than a blanket approach adopted by several third world countries, former Soviet Union and Eastern Europe in the eighties and the nineties.

Economic reforms in China were not in the form of ‘shock therapy’ injected by the international financial institutions or experts from Harvard, argues the author. Based on decentralized policymaking, the Chinese economic reforms were homegrown, gradual and introduced on local experiment basis only in a few special economic zones (SEZs) situated in the coastal and eastern regions. After the successful outcomes of these experiments, such zones were extended to more areas later on.

While debunking several misconceptions regarding foreign investments in China, the author contends that China granted freedom to foreign investors only in the SEZs while in the rest of the country severe restrictions on the inflows and outflows of capital including performance requirements and geographical limits were imposed. Nevertheless, China’s economic model has resulted in a number of negative economic and social outcomes such as growing income inequality, over-dependence on exports and widespread pollution.

The author coined the term “Beijing Consensus” to describe the distinctive features of Chinese economic reforms initiated in 1978. China’s entry into the WTO poses new challenges as the earlier strategy of experimentation in selected areas will be replaced by WTO mandated timetables covering almost every sector of the economy, argues the author.
 
   
     
  Financial Globalization: New Challenges for Peoples’ Movements     
  by By Kavaljit Singh  
 
There is no denying the fact that the globalization of finance has surpassed the globalization of production and trade. In order to address issues emerging from globalization of finance, citizens and peoples' movements need new tools of analysis and advocacy. It is high time that activists and groups start developing understanding of finance capital and its institutions in order to develop effective campaign strategies.
 
   
     
  India and Global Financial Markets:
Emerging Issues, Lessons and Responses   
 
  by Kavaljit Singh  
 
This paper is a part of several studies commissioned by FES on International Financial Architecture in 1999.
 
   
     
  Bayer (India) Limited: The “Other Side” of the Story     
  by Nilanjan Mukhopadhyay and Kavaljit Singh  
 
Bayer India Limited (BIL) has significantly increased its presence in India since 1991. However, this growth has been accompanied by deteriorating commitment to industrial values and total disregard for social and environmental concerns. BIL has greatly succeeded in marginalizing the trade unions and is seeking to impose its new industrial culture among its workers. BIL has also benefited with lax regulatory bodies. This case study examines these issues based on information collected from various sources.
 
   
     
  The Reality of Foreign Investments: German Investments in India (1991-96)     
  by Kavaljit Singh  
 
The post-liberalisation period (1991-96) received a substantial amount of foreign direct investments from Germany, particularly in the industrial sector. This report examines the trends and patterns of German investments in India, in the light of Investment Protection Treaty and Double Tax Avoidance Pact between India and Germany. The report finds that the major attractions for German investors in India are cheap labour, huge domestic market, and lax environmental and public health regulations with ineffective implementation by state machinery.
 
   
     
  TNCs and India:
An Activists' Guide to Research and Campaign on Transnational Corporations (I)   
 
  by Jed Greer and Kavaljit Singh  
 
A guide and resource book on how to research and campaigns on TNCs.
 
   
     
  TNCs and India:
An Activists' Guide to Research and Campaign on Transnational Corporations (II)   
 
  by Jed Greer and Kavaljit Singh  
 
 
   
     
  TNCs and India:
An Activists' Guide to Research and Campaign on Transnational Corporations (III)   
 
  by Jed Greer and Kavaljit Singh