Reflections of Rajaram Bojji

Look at DMRC Airport link expt with Reliance. Unless private party gets 30%pre tax profits no one interested to put money. And if capital has to come from private funds, the capital cost of project increases by 20 to 30% automatically. To assure the requisite revenue flows to service debt and ensure profits, recovering capital is an impossible task because our econony does not allow such fare structures to be born by users. FDI initially looks attractive because interest rate could be lower.  But after factoring in FE risk, unlikely to be any cheaper. I find only sovereign funds from China or similar arrangement with Japan can afford to invest with own national interest agenda. There is no free lunch in the world. India has collective genius to dump own intellectual capital and revels in copy cat brhaviour. Probably China or Japan will take over Mumbai Ahmedabad Bullet train. More likely China. Interesting time! Elite in Mumbai will start learning Chinese! http:...

The People's Bank of China said in a statement that a Financial Times report that the State Administration of Foreign Exchange (SAFE) was concerned about its exposure to euro zone debt was groundless. The central bank said Europe would remain one of China's main investment markets and Beijing would support actions to help the European Union resolve its debt crisis . The 16-nation single currency, which has lost more than 8 percent against the dollar this month, rose more than 1 percent after falling to a day low of $1.2154 on the FT report. European stocks also rose by 2 percent after a 3 percent jump on Wednesday.

It sound s crazy but our minds would like to believe otherwise. It is interesting to think like olden days detective investigating a "crime", who benefits at the end of this cycle of trade imbalances? Fall of dollar is equivalent to the 3rd world war, and may be I feel the end of cold war was bad-- it removed a constraint in the system. Unconstrained unipolar world, led USA to indulge in free unlimited consumption, seeking the inevitable constraint, and now the impact of hitting the constraint could be the economic center of gravity will move to China. Dollar may lose its position as the reserve currency, if more nations start trading oil in non-dollar terms, and year over year dollar investments by others get dried up. The upheaval will certainly have collateral damages. Only rich fat cats took advantage of the stimulus because, only the same rich fat cats who failed the nation, remained in charge of distributing the largess. Darwin's theory works; self-preservation come...