G20 Seoul Summit Delivers Fake Commitments Once Again

Article first published as G20 Seoul Summit Delivers Fake Commitments Once Again on Blogcritics.

G20 summit held in Seoul on November 11 and 12 has failed to reach a concrete agreement to address the rising fears of currency war. It has also failed to bring out guidelines for curbing trade imbalances as envisaged by the world countries amid discouraging conditions of multi-speed growths for various economies. Fifth communique issued by the G20 countries since the financial and economic crisis broke out in 2008, has repeated its rhetoric of addressing concerns of the most vulnerable, providing social protection, decent work and also ensuring accelerated growth in low income countries (or Least Developed Countries).

Jobs at Heart of Recovery!

The communique said the G20 countries were determined to put jobs at the heart of the recovery which is just a big lie. The leaders of the developed countries and the emerging market economies (EMEs) are not ashamed even a bit to give this empty commitment, where at least 100 million have been stripped of their jobs and 120 million have been pushed into hunger afresh after the unprecedented, worst global economic crisis since the great depression has been unleashed by the greedy global financial conglomerates.

There have not been serious attempts to create jobs throughout the world, instead the jobs are lost every day by the austerity measures in European Union countries and jobless growth in the US. Number of economists and analysts along with Nobel laureate Paul Krugman, have dubbed the growth that we are witnessing as “jobless growth.”

Crisis Contributors

BBC news has quoted Obama as saying there should be no controversy about fixing imbalances “that helped to contribute to the crisis that we just went through.” Obama must have lost his senses or have suffered from short term dementia, let us say. Otherwise, G20’s first communique after the financial crisis, and even subsequent communiqués have acknowledged that the financial conglomerates and their risky, greedy financial business practices have created the worst crisis. There was not a mention of trade imbalances contributing the crisis in G20 communiqués, yet Mr. Obama dared to spell it. If Obama likes to fix imbalances, that is well and good, but this type of miscalculations only contribute to rising trade tensions.

Manmohan Singh Dances to Obama’s Tune in G20 Conference at Seoul

Article first published as Manmohan Singh Dances to Obama’s Tune in G20 Conference at Seoul on Technorati.

The Prime Minister of India has proved that so-called Manmohanamics is nothing but making India subservient to the interests of the western imperialist countries, particularly to those of the US on an international forum, G20. During his speech in G20 conference held at Seoul, South Korea on November 11 and 12, he danced to the tune of the US President Obama on the issue of current account deficits being faced by the US. He gave chorus to the US’ song deviating himself from his colleagues of emerging market economies.

CAD vs. CAS

Manmohan said in the G20 conference, “Major industrialized countries were running unsustainable current account deficits which have to be reduced to manageable levels.” Up to this point, no one needs to object. He then added, “If this is not to have a contractionary impact on the world economy, it must be offset by reducing current account surpluses elsewhere. This rebalancing requires pursuit of appropriately coordinated policies in our countries.” And, there he was, referring to his neighboring developing country, China.

So, Indian prime minister was telling that in order to reduce the trade deficit and hence the current account deficit of the US, China has to reduce its trade surplus and hence of course, its CAD. He is suggesting the China and apparently other surplus countries have to take appropriate measures like coordinated policies, to reduce their surpluses so that deficit countries may be prospered and reduce their trade deficits. That’s what he called rebalancing. Isn’t this the one vigorously being proposed by the US president Obama and its treasury secretary Timothy Geithner? Yes, it is.

Manmohan vs. Montek Singh

Whether Manmohan was aware of it or not, his market economy oriented friend and the Vice Chairman of India’s Planning Commission said on the sidelines of the G20 summit on November 11, "The real issue is given that it is a problem, how do we coordinate policy? I don't think you should be too demanding ... because such policy coordination has never been attempted before."

Brazil Enters Currency War

With announcement of second stimulus dubbed as QE2 of $600 billion by the US’ Federal Reserve, Brazil’s entry into the so-called currency war, the term coined by the IMF director Dominique Strauss Khan. Brazil is the first country to criticize the move by the Federal Reserve, which stated that the second stimulus was aimed to stimulate the slowing GDP growth. It said it would implement the package over next eight years through buying government bonds.

Competitive Advantage

But, Brazil sees the Fed’s move as a step to devalue the Dollar to inflate the competitive advantage of the US’ exports over others. Brazil’s concern is that the money injected into the US’ economy would flow to the emerging market economies (EMEs) seeking higher returns, thereby pushing their currency values that would result into reducing the competitive advantage of exports from the EMEs.

China Cautious

China reacted cautiously on November 5 saying that it would not go on record for or against the Fed’s move, but said the debate highlighted the need for reforming the international financial system. It added it can understand the US concern of slow growth. Chinese central bank officials met regularly with their Fed counterparts, and the Americans gave detailed explanations for the monetary changes, the central bank chief Zhou Xiaochuan said on Friday.

Google’s Evil Intentions Become Visible as UK MPs Grill

Article first published as Google’s Evil Intentions Become Visible as U.K. MPs Grill on Blogcritics.

Google’s explanation about its wi-fi data collection that it collected erroneously the emails and passwords has been rejected by the UK MPs, during a two-hour parliamentary debate on privacy. Google has always maintained that the personal data in error because of code being mistakenly included in the street view software. This statement itself demonstrates that Google is not ready to accept what it has done.

Privacy Debate

That is why a Conservative MP Robert Halfon has stated, "I find it hard to believe that a company with the creative genius and originality of Google could map the personal wi-fi details, computer passwords and e-mail addresses of millions of people across the world and not know what it was doing." It is impossible to believe that Google did not know what it was doing, given Google’s leadership in cyber technology. It is pretending innocence to escape the consequences of its wrong doing.

Robert added, “My own feeling is that this data was of use to Google for commercial purposes and that is why it was done.” Yes, Robert was true about Google’s intentions. It has everything to with commercial interests. There could be more than that also, given the accusations from some quarters that CIA and Google are secretly related on intelligence issues, though the facts are yet to be established.

Google’s Denial

Google has a long history of denying the facts of its evil intentions. Google accepts its market leadership in communication technology but pretends innocence when it is confronted with the facts of its intentions over cyber dominance, that too through illegal methods.

India Succumbs to US Pressure, Accedes CSC Pact for Nuclear Liability

This article has appeared first on Technorati.com

As Obama visit to India is approaching, attempts to dilute nuclear damage liability bill passed by the Indian parliament are speeded up from the US side. India signed on October 27 an international treaty on civil nuclear liability under pressure from the US.

Domestic Law

Indian Parliament approved recently in August ‘nuclear damage liability bill’ with both ruling and opposition parties taking a unified stand supporting it. Though initial draft did not envisage any liability on suppliers of nuclear material and equipment, the final bill placed liability on suppliers too. However, there are several intermediary conditions to bring into effect the liability on the supplier countries or firms, while the bill places immediate liability of $320 million on the operator country i.e. India.

Imperial US

The US companies are averse to paying liabilities even though they supply substandard and damaged material and equipment due to which nuclear damages may occur. They fear that they will be forced to pay compensation as the US pressured BP to pay a whopping $32 billion for its oil spill in Gulf of Mexico. During deliberations between the ruling and opposition parties regarding passage of nuclear damage liability bill, the US companies lobbied heavily not to place any liability obligations on supplier countries, particularly the US and Japan. But the pressures did not work, as the Indian people were outraged against Bhopal gas leak judgment.

At the same time, the world witnessed two disastrous accidents on which the whole world has its attention, on what the outcome would be. One was the biggest ever oil spill in American history, in the offshore American west coast in Gulf of Mexico. The other one was that thirteen Chilean miners were not yet rescued from a collapsed mine whose videos and photos were published on every media on daily basis.

Defense Ties May Deepen During Obama Visit to India

Article first published as Currency War to the Fore in G20 Ministerial Meeting on Blogcritics.

The US President Barack Obama is visiting India in second week of November. He is bringing several business people along with him while coming to India. Along with lobbying for contracts of billions of dollars, Mr. Obama has aimed at convincing India to be its strategic military partner in the region to secure its interests.

Relations

The relations between India and the US have only been speeded up since 1990 when USSR, the cold war alley for India, collapsed and India began opening up of its market to foreign MNCs, under the stewardship of the then Finance Minister Dr Manmohan Singh. The improvement of relations acquired faster pace in BJP’s coalition government except a brief period of sanctions regime after India’s 1998 nuclear tests under BJP rule, which was lifted in late 2001, maybe partly as a result of September 11 attacks. And that pace increased further in Congress’ coalition government.

Strategic Partnership

The Strategic Partnership Agreement was reached between India and the US in March 2000 while Bill Clinton was in office. The raising presence of China militarily as well as economically and somewhat, though not on full scale, economic resurgence of Russia necessitated then for the US to take the relations with India to the top level. The US needs a reliable partner that too a strategic partner, in the region to counterweight the increasingly assertive China.

After two devastating wars of Bush administration, this necessity was multiplied in terms of the interests of the US. America's new relationship with India has come as a broad security, political, technological, and economic arrangement on par with America's relationship with Europe or NATO. The US was even talking about sharing roles in joint space missions. The ex-president of the US, Bush and his first secretary of state, Collin Powel have once talked, back in 2004, of India’s common interests in securing their positions in sea lanes from the Persian Gulf to Malacca Islands. India has already been patrolling with its navy.

Commonwealth Games Likely to Affect India’s Image in Economic Front

Article first published as Commonwealth Games Likely to Affect India’s Economic Image on Technorati.

Delhi Commonwealth Games, 2010 is going to remain a big fiasco for third largest Asian economy, India after China and Japan. Political and financial corruption could remain a scar on the face of ability of India in conducting such big events.

There have been many reports coming in about corruption scandals surrounding CWG – 2010, well in advance for two months. But the government, especially the Prime Minister Dr. Manmohan Singh seemed completely unaware of what was up to regarding CWG arrangements.

Missed Link

The idea of conducting international events stems out from the wishes of the rulers to keep their country at spotlight for improving business, attracting tourists and finally contributing more for the growth of the country. It is surprising that the growth-figures-oriented Prime Minister has missed the link between CWG’s success and his aspirations for surpassing Chinese growth rate.

Many international news networks have expressed doubts whether India could make it. The doubts remained unsolved even as the date is just 3 days away. The government appointed ministerial body of three ministers only five days before the inaugural date, i.e. 3 October.

Image Blurring

Indian rulers are keen for not letting any spats like H-1B visa fee hike, outsourcing ban and restrictions on exports from the US side, to play spoilsport during the visit of the US President Mr. Barack Obama in November second week. However, they seem to forget how a failure or even a partial failure in conducting CWG is going to affect the Indian image on the economic front.

Foreign Investments Invited in Indian Roads

Foreign investments are invited in building Indian roads according NHAI (National Highway Authority of India) official J N Singh, Reuters reported. Indian infrastructure is thought to be a biggest hassle for the development of India by many foreign and domestic analysts in recent years.

Reuters news agency is one of such firm that has relentlessly been advocating the theory that the Indian infrastructure has become a biggest obstacle for India to equate the double-digit growth rate of neighboring China. It says underdeveloped infrastructure is one of the contributors for the high inflation rate of India.

$18 Billion Roads

India is expecting 30 percent of the total $18 billion cost of Indian road projects in the present fiscal year would be met by the foreign investors. The NHAI official revealed in the ‘Reuters India Investment Summit’ that the government has so far awarded 3000 km road from April to August and looking to award 6000 km road in the remaining part of the present fiscal year up to March 2011.

India is awarding the road building contracts on BOT (Build-Operate-Transfer) model, a type of partnership model formulated for the convenience of private contractors. The BOT system is nothing but a veil to privatization of Indian infrastructure, stitched and embroidered some ten years back.

What is BOT?

“Build” term in BOT implies that the roads will be built by the private contractors. “Operate” implies the built roads will be operated by again the private contractors. It includes mainly the setting up of tollgates at different points of the highways and collecting toll tax from the users.

China’s Growth Interests US Leaders

 Article first published as China’s Growth Interests US Leaders on Technorati.

US President Barack Obama has changed course, criticizing China for its exchange rate policy. Obama said on Monday that the rapid economic growth of China was in the interest of China. The announcement is interesting, though somewhat contrary to the accusations made against China that it was manipulating its currency value to keep it exceptionally low, making its exports cheaper.

The speech of Mr. Obama was telecast live on CNBC around 10:30 pm IST (GMT+5:30). He was on his way to raise funds for a Democratic Senate candidate for Pennsylvania. He said, in the interview given to CNBC, that China’s strong growth benefited the US. Moreover, he clarified that the US’ growth was also beneficial to China (exports).

The same opinion was acknowledged by the Treasury Secretary Timothy Geithner while giving a report to Congress on Sept. 16, according to Xinhua news agency. He said in his report, “We have very significant economic interests in our relationship with China. A strong and growing China benefits the United States, just as a strong and growing United States is good for China.”

Implications of China Monetary Policy on Global Imbalances

Article first published as Implications of China Monetary Policy on Global Imbalances on Blogcritics.

China’s exchange rate policy has been a contentious issue in the global economy particularly between the China and the West. The West has long been criticizing China for keeping Yuan at an exceptionally lower value. They claim China is in an advantage position due its manipulated lower Yuan value, as it makes China exports cheaper. The US President Mr. Obama accused China as currency manipulator in his earlier days of coming to power.

West’s Concerns

The West says China had pegged Yuan value to the dollar. Yuan value did not change from its value of ¥6.83 a dollar since July 2008. However, China denied the claim on equal tone and resisted pressure from Obama to raise Yuan value. Chinese Premier Hu Jintao said, “Yuan rise would neither balance Sino-US trade nor solve the [US] unemployment problem,” in April during the NSG (nuclear suppliers group) meet in Washington DC.

Many Economists and analysts suggested to China, it would be fair to share the growth of the economy by appreciating the Yuan value, when China recorded 11.9 percent of growth rate in the first quarter. Nevertheless, China did not find any pressing reasons for immediate appreciation of the Yuan value then.

The US Retaliation

The US Treasury Secretary Tim Geithner postponed submitting his report on whether the China was manipulating its currency value or not, to the Congress in April. It was rather a soft approach by the US, hoping China would reciprocate positively by tightening its monetary policy. It was also a revelation that the US was wary of trade war against China. China invested nearly 70% of its vast foreign reserves in the US Treasury bonds.

Reserve Bank of India Beats Forecast on Rate Hike

(Article first published as Reserve Bank of India Beats Forecast on Rate Hike on Technorati.)

The Governor of Reserve Bank of India, Duvvuri Subba Rao could not allow himself lagging behind the trend of beating forecast by growth numbers of India. At the quarterly review meeting on Sept 16, 2010, the RBI raised interest rates more aggressively than expected. The RBI lifted repo rate, at which it lends to banks and other financial intermediaries, by 25 basis points to 6 percent. It also lifted reverse repo rate, at which RBI absorbs the cash from the system, by 50 basis points to 5 percent.

Inflation concerns

The deference between the repo rate and reverse repo rate is decreased from 1.25 percent to 1 percent, signalling that the central bank is committed to control the high rate of inflation. "Inflation remains the dominant concern in macroeconomic management," the central bank said in a statement released to reporters. “Monetary Policy Review: September 2010,” almost confirmed that the inflation rates have reached their peak, but cautioned it is likely to remain at unacceptably high levels for some months.

Several factors prompted the central bank to rein in the inflation, which is still nearer to the double-digit figure. Almost double the forecast growth (13.8 percent) of Industrial output in July 2010; rocket speed rise of the share markets; and robust annualized growth rate of GDP (8.8 percent) for the quarter ending with June 2010 necessitated controlling the money supply in the system.

Big Firm Bonuses Back to pre-Crisis Level

Article first published as Big Firm Bonuses Back to pre-Crisis Level on Technorati.

Bonuses to executive directors are back to pre-crisis level in the U.K. Though pace of increases is slowed, the levels of payment have reached almost pre-crisis level. A business advisory firm Deloitte conducted a survey to find the developments occurred in pays and bonuses after the crisis. The survey revealed that pay increases for the executives might be history for now. The BBC News quoted Stephen Cahill of Deloitte as saying, “Last year we saw a very large number of companies freezing executive salaries, but at the time it was difficult to predict whether this was a one-off. Now it appears that the years of executive salaries increasing at rates far in excess of inflation and the increase in average earnings are, at least for the moment, well and truly over.”

Toppers at Top

The survey found that the average bonuses for executive directors of FTSE 100 companies were equal to 100% of their basic salary for the year. It said the top 30 companies increased the bonuses to their executives by 140%. Coming to mid-sized FTSE 250 companies, one in Seven paid no bonus to their bosses. For the present year also the difference between the trends of bonuses in FTSE 100 and FTSE 250 companies are expected to continue. While for the bosses of FTSE 100 companies, the bonuses are expected to be greater than the last year in the present year; they would be lower for FTSE 250 companies.

Bonus vs. Austerity

While European Countries are burdened with high levels of debts and deficits and their governments are already on the path of aggressive austerity measures and spending cuts, trade unions or giving warning signals that the workers’ pay

Ohio’s Outsourcing Ban - A Tip of Iceberg of US’ Protectionism

Article first published as Ohio’s Outsourcing Ban is the Tip of the US Protectionism Iceberg on Blogcritics.

H-1B Visa fee hike and the ban imposed on outsourcing by Ohio State are the latest of the US protectionist measures unveiling once again the protectionist policies of the US Government. The U.S. teaches the entire world to fallow the ‘Free Market Economy principles.’ It does so even at G7 meetings to the so called ‘most developed countries’ of the world. They started GATT negotiations asking the world nations ‘to accept or reject’ the agreement, as if there was no other alternative. They’ve ultimately established WTO, completed Uruguay Round and urging to complete ‘Doha Round’ trade negotiations for further Liberalization, Privatization and Globalization (LPG).

Not New

While GATT negotiations of Uruguay Round were on, the US televisions transmitted a news item that showed an Indian garment catching fire instantly to tell the viewers, not to buy Indian garments as there was imminent danger of getting caught by fire easily. This was done in the 2^nd half of the 90s’ decade and the US garment producers were alleged to be behind transmitting the news item. Similarly, high tariff on Chinese tyres in the name of anti-dumping duties is one such case. This is nothing but a covert protectionism. The US stipulates strictures to the third world countries through IMF and World Bank loans, like reducing or abolishing subsidies to their agricultural sector, selling every service –Hospitals’ user charges, water charges by metering the consumption even by farmers and so on- to the people. The US aka its companies want people of all countries buying its agricultural products and inputs. Every country in the world should buy the America produced grains, wheat, burgers, pizzas and what not?

Larger Background

Actually, the matured capitalist economies like the US, the EU and Japan are increasingly facing crisis after crisis that are becoming more and more difficult to recover from. Japan’s painful and decade long recession from 90s into 21^st Century and the present deflation & dead-slow growth, the dotcom bubble’s burst at the beginning of the millennium, the

China Intensifies Drive to Relocate Industries to the Central and Western Inlands

Article first published as China Intensifies Drive to Relocate Industries to the Central and Western Inlands on Blogcritics.

The China has been campaigning for more than a decade to “develop the west,” as part of a stated aim to develop the inland region of the Western China. Ever since the China adopted market friendly economy since 1978, the rapid industrialization has been mainly concentrated in southern coastal provinces like Shenzhen, Guangdong and Zhejiang. As a result of rapid urbanization and industrialization, people from western provinces migrated to the coastal provinces in search of job opportunities, thus, providing cheap labor to the factories in the coastal region. The cheap labor thus available majorly due to migration helped the southern region attracting billions of dollars of FDIs.

This was actually a result of the policy preached by the then supreme leader of China Communist Party, Deng-Xiao-Ping. He advocated to “allow first some people to become rich, who would latter provide resources to make the rest of the country rich.” This made southern provinces more crowded and prices of properties, like housing and land, have shot up beyond the reach of even rich middle classes. The western and Northern provinces of the China have been deprived of industries, jobs and related developments due to concentration of industrial activities in southern and eastern coastal provinces.

Inland Relocation of Industries

The worst economic crisis, since the great depression of 1930s, has pushed the Chinese government to drive aggressively for agglomeration of industries towards central and western provinces. The Chinese version of the cabinet, the state council namely “Central People's Government,” the highest executive organ of State power has issued directives stressing the importance of relocating industries to the central and western inland provinces to keep manufacturing competitive and encourage job growth closer to the homes of China’s vast rural population. "The

India’s Government Paper Proposes Weakening FDI Rules

Article first published as India’s Government Paper Proposes Weakening FDI Rules on Technorati.

The Commerce and Industry Ministry on Friday, released proposals for discussion on whether to abolish foreign investment caps imposed on the companies invested in joint ventures in India prior to the year 2005. The discussion paper released is said to be a part of series of papers released by the ministry as a measure to attract more FDIs. Such papers also inform foreign investors how the Government of India is changing over time the policies and priorities.

Before 2005, there was a rule for the companies who tied up with Indian partners in joint ventures to seek approval from the federal government before bidding for expansion outside the tie-up. The problem is that the policy was reviewed in 2005 after which the rule exempted the companies that invested after 2005 from seeking approval for further expansion of their own. This is clearly observed as discrimination between the companies entered India before and after 2005.

Vedanta’s Acquisition Bid

Maybe the recent bid by Vedanta Resources to acquire Cairn India, a subsidiary of the U.K. based Cairn, prompted the ministry to release the discussion paper. It is a common practice in India that when the government intends a policy review, it would first release discussion papers to identify the opposition so that it can calm them properly. Cairn India has a tie-up with ONGC, a public sector oil exploration company, in its biggest oil well in Rajasthan State. Cairn India holds 70% stake and ONGC the rest in it.

India focused Vedanta Resources made a highest bid for Cairn India of $9.6 billion and sought the government’s approval which is still pending. When the matter came to light there were huge expectations that the ONGC might

IMF Briefing Note Says Slow Growth is Certain in 2nd Half of 2010

Article first published as IMF Briefing Note Says Slow Growth is Certain in 2nd Half of 2010 on Technorati.

The International Monetary Fund reiterated that risks for slowdown in global growth in 2^nd half of 2010 may be unavoidable and even intensified, due to recent turbulence in sovereign debt markets and prolonged weakness in the financial sector. In a briefing note prepared for Group of 20 (G20) countries’ deputy finance ministers, the IMF said though the global growth in 1^st half of 2010 had been somewhat stronger than expected, it would slow in 2^nd half of 2010 and 1^st half of 2011.

First half of 2011 includes last quarter of present FY11 for India. This poses a danger to India’s present hawkish markets’ mood that risks India’s GDP growth for FY 2010-11 as the US developments automatically impact Asian economies as per recent comments by IMF director Dominic Strauss Khan. IMF cites crisis of confidence in some national economies coupled with the financial sector’s weakness as major reasons for the expected slowdown.

US weakness

Yesterday the WEF report said the U.S ranking slipped from 2^nd position to 5^th position due to decreasing businesses’ confidence in the US economy and its huge debt and deficit. The IMF said the US property market was a source of downside risk as foreclosures of mortgaged houses had been speeded up there. Increased foreclosures or number of home repossessions are further pressuring bank balance sheets.

This may be causing reduction in credit available to the economy, the IMF suggested. Risk of credit unavailability causes renewed turbulence in sovereign debt market that could adversely affect the ‘to and fro’ flow of finance between sovereigns and the financial sector. Such developments could cause Greece like crises in developed economies.

Some Sops for Worrisome Investors as the New U.S. Data Offers Positive Signs

Article first published as Some Sops for Worrisome Investors as the New U.S. Data Offers Positive Signs on Technorati.

Here are some sops to those who worry about the nearly unanimous expectations that the US slows down in the second half of the present financial year. Offering a rosier picture that the U.S. economic recovery might be still on track, the stocks the US and the EU are lifted up with the release of rather stronger than expected US data as well as optimistic comments from officials of advanced countries. The US data released on data Thursday, on labor conditions and business activities signaled for the US economy may somewhat continue to maintain some recovery.

Positive Signs

As per the data released on Thursday, the US trade deficit shrank more than estimation in July as exports expanded highest in one year; and the new claims for unemployment insurance fell more than expected. The data has been positive for last few days compared with that of August month. Fear of double dip recession for the recession kept investors away from being active in August month and the present data, though not up to the mark for cautious people, have pulled some investors into activity.

Japan's Finance Minister Yoshihiko Noda said the ministry was conducting simulations on forex intervention, though the Japanese currency hardly budged as the perception remains that Tokyo is unlikely to intervene until the U.S. currency falls near 80 yen. But the governor of Bank of Japan undermined the minister’s comments as he said he did not discussed about valuation of currencies and monetary policy at a government meeting.

Another Big Blow to India-Focused Vedanta Resources

Article first published as Another Big Blow to India-Focused Vedanta Resources on Technorati. Here is another big blow from India’s environment ministry to India-focused mining giant Vedanta Resources. The U.K. based company has received a letter that is also posted on environment ministry’s website (letter can be found here or here) in which it has been asked to explain for its serious violations of country’s green laws made at Bauxite refinery in Orissa. The ministry asked Vedanta to explain why the environment clearance given to its one million tonnes a year factory in Orissa should not be cancelled. The government of India has recently rejected permission to mine at Niyamgiri hills in Orissa. A government panel has given a report to the government not to permit Vedanta to mine in forest area that would seriously endanger the existence of two tribal groups namely Dongria Kondh and Kutia gondh. Vedanta is also facing hurdles in its bid to acquire Cairn India for $9.6 billion. ONGC has 30% stake in Cairn India’s Rajasthan oil field due to which Cairn India is subjected to get permission from the federal government in case of change of ownership. The latest government notice puts Vedanta's alumina refinery under cloud. The company has plans to expand the refinery's annual capacity to six million tonnes. Vedanta's project in Orissa is valued at about $9.5 billion. It is also come to known that the company has not taken permission to increase the capacity of the bauxite refinery. The latest violations were