End of the runway ..

    As another strike hit Kingfisher.airlines operations, the dispute between pilots and management is still raging on.The management of the company seems to be hedging it's bets on luring investors to inject capital :

As the pilots struck work for the third time in the last 12 days, Kingfisher Chairman Vijay Mallya asked the agitating staff “not to speak to the media” or “disgrace the company” as it would affect recapitalisation efforts.

    This hinges on the hope that FDI in aviation would be allowed in the near future. Uncertain as that prospect is , it is unclear why a foreign airline would invest in a company with more than Rs.7000 crores of debt and has never turned a profit. Besides,the airline operation of Kingfisher does not command the brand equity it once did.

    Then there are the myriad problems plaguing airline business , not to mention the murky regulatory regime in India. Even if they look past all these problems, why not invest in an airline that is relatively new and has not accumulated any of the older carriers' ills.

Articles of interest - July 13 2012

Here are some interesting reads:

BJP and yeddy  in karnataka : Business Standard

China - This time may be different : Economic Times

DGCA and running of civil aviation in India : Economic Times

Repurposing NREGA

    The only assured aspect of any mass government program is that it is very hard to dismantle after it is enacted. And so it happens that the NREGA program now costs India upwards of Rs.40,000 Crores. Available data show that yearly outlays in absolute rupees have grown by more than 300% since 2006-2007.

    At the moment, NREGA's primary goal is to build physical infrastructure in rural areas and provide jobs to the unemployed in the process. The program has it's shortcomings and the quality of assets created has been questionable. There are some changes that can bring better results within the existing framework. Better yet, it may be useful to examine other possibilities of creating jobs in rural areas under NREGA.

    Studies like this on maternal and child health indicators show that rural areas lag urban regions by wide margins. Malnutrition which also contributes to deaths among poorer children,is shamefully high among the most vulnerable sections. NREGA should consider spending part of the yearly budget to employ people from rural areas who can work on advancing maternal and child health. Training can be imparted to these NREGA workers in assisting and enabling women to seek and obtain nutrition, pre and post natal care.
   
    Nutrition programs run by the government are not yielding the results they were set out to. Educating potential beneficiaries to seek and avail better outcomes from these programs create a powerful pull mechanism. Right now, the push mechanism used by the government in administering these programs is not working.

    To be sure, India desperately needs major improvements in physical infrastructure.  The social infrastructure however, is in even worse shape and hardly gets similar attention as the lack of roads , water and electricity. Dedicating a large chunk of NREGA funds to create social infrastructure jobs can deliver better value for money than the physical assets being built at the moment. It could also help save and enrich thousands of lives.

Articles of interest - July 1 2012

Here are some interesting reads.

Maternal and child health data - Census of India

Gujarat under Narendra Modi - The Economic Times