Delhi dumps Bush de-escalation deal
From Russia with love: comradeship in arms
Pak strikeback with pink slip
Image repair at low poll risk
Front readies madarsa message
Hijack link in scribe snatch
Police primer on UP poll nominees
Govt eases tax on perks
Calcutta Weather

Washington, Feb. 6: 
With one week to go before President George W. Bush receives General Pervez Musharraf in the White House, secretary of state Colin Powell has asked Pakistan�s President to �round up terrorist organisations and do it in a way that will give India confidence�.

Departing from his text prepared for delivery before the Senate Foreign Relations Committee yesterday, Powell demanded of Musharraf: �I hope he will continue to take action to reduce incidents over the Line of Control.�

Powell�s clear-cut demands to Pakistan, diplomatic sources here said, follow India�s rejection of a compromise package from the Bush administration which urged New Delhi to reduce the presence of combat air force planes close to the border with Pakistan.

The package was part of an effort by the Bush administration to ensure a tangible de-escalation on the military front so that Bush could seek something in return from Musharraf on relations with India next week.

The package required India to end the �high alert� of forces in close proximity to Pakistan and denude air force bombers in the area of their weapons.

Sources here said Washington�s expectation was that New Delhi would respond favourably to the proposal since Powell had not asked India to pull back its forces from the border either during his recent visit to South Asia or at any time thereafter.

But India told the US that there would be no change in its military preparedness until proof of Musharraf�s sincerity in changing the course of events in the subcontinent was translated on the ground.

Producing results on the India-Pakistan front during Musharraf�s visit here was not the only aim behind Powell�s demands made at the Senate committee hearing. America wants to see that its interests in the terror war are not jeopardised by any fighting between the subcontinent�s irate neighbours.

He said complying with these demands would ensure �that they (India and Pakistan) are both united in a campaign against terrorism, and not let it degenerate into a campaign against each other�.

Praising Musharraf�s �great courage and foresight� in conveying a decisive message to his country and to the Islamic world on January 12, Powell said: �Now he must show equal courage in implementing his concepts in Pakistan.�

Surprisingly, the top foreign policy aide to Bush was generous in his praise of China�s role in defusing India-Pakistan tensions, even hinting that Chinese Prime Minister Zhu Rongji contributed to this effort during his visit to New Delhi last month.

�China has played a constructive role in helping us manage over these past few weeks the very dangerous situation in South Asia between India and Pakistan,� he said.

Powell said: �When I could call China�s foreign minister Tang and have a good discussion, making sure our policies were known and understood, it made for a more reasoned approach to what was a volatile situation.�

He surprised many China-baiter Senators by saying: �Beijing was not trying to be a spoiler but instead was trying to help us alleviate tensions and convince the two parties to scale down their dangerous confrontation � which now it appears they are beginning to do.�


New Delhi, Feb. 6: 
Russia today offered India co-production agreements for a range of military hardware, setting the stage to transform a relationship that began 40 years ago.

Defence ministry sources said Russian deputy Prime Minister Ilya Klebanov told the military technical commission that Moscow was looking to change the traditional buyer-seller relations that has governed its military ties with New Delhi.

�Russia is willing to go beyond the sale and lease of hi-tech weapons,� Klebanov told delegates at the inaugural of the three-day meet in South Bloc.

Klebanov said he had come to India with �several new proposals�. This included an offer of partnership in co-design and co-development of �futuristic weapons systems�.

Neither the Russian side � the Russians are here with a 110-member delegation of whom as many as 50 members are participating in talks on military matters � nor the Indian side let out what kind of equipment they can produce jointly.

Details of the proposals would be given by the Russians in meetings of sub-groups and inter-services committees in discussions spread over three days.

So far, India-Russia military ties have rested primarily on commercial transactions that have accommodated licensed production. For instance, of the 310 T-90 tanks that India is currently acquiring from Russia, 186 are to be developed at the ordnance factory in Avadi, Tamil Nadu.

Aircraft have been procured in completely knocked down parts and assembled at Hindustan Aeronautics in Bangalore. A defence ministry official said the Indians and Russians were talking of agreements that go beyond such arrangements. It could even include joint ventures.

Though the formal offer for co-design and co-production was made today, it has been in the brewing ever since the dismantling of the erstwhile Soviet Union left the gargantuan Russian defence-military complex starved of funds. India, China and Iran are major consumers of Russian armaments. India is dependent on Russia for 70 per cent of its military hardware.

�Ever since 1962 when we struck the first major deal with Russia (to acquire MiG21 aircraft), the pattern of business has been, first, buyer-seller and then, licensed manufacture. Our long standing demand has been to jointly manufacture equipment. We have had knowhow from the Russians. Now we need �knowwhy�. So we could be moving from co-development to co-designing.

�India is in a fortunate position now in terms of acquisition of military equipment because the West is also more eager to sell. But we cannot turn off the tap on Russia because so much of our equipment is from them,� said analyst P.R. Chari, director of the Institute for peace and Conflict Studies.

Even as the Russians are here, the armies and the navies of India and US held talks on joint training and exercises. Next week, General Richard B. Myers, chairman of the US Joint Chiefs of Staff, will be here.


New Delhi, Feb. 6: 
Pakistan International Airlines, banned by India from flying into the country or overflying its air space, has decided to hit back.

All 36 Indian employees of the airline have been sacked and ticket sales work farmed out to general sales agents.

PIA decided to get rid of its Indian staffers despite a sessions court order restraining it against any precipitate step. The order was issued on a pre-emptive petition filed by the employees who anticipated they would be sacked after PIA flights to India were banned on January 1.

The employees are trying to highlight the disdain with which PIA has treated the court order.

�PIA still sells a lot of tickets in India, routing passengers to the Gulf on other airlines and then picking them up for onward flights... this work is now being done by two GSAs � J&S Travels in New Delhi and Raj Hans Travels in Mumbai,� said M.A.H. Naqvi, president of the PIA Employees Association here.

PIA and its Indian staffers have been eyeball to eyeball for some time now. Though its Indian operations are among the most profitable, PIA decided to retrench five Indians last year to trim its salary bill and contain losses it was running up elsewhere. �We naturally opposed this and went to the labour commissioner. The commissioner and even the labour minister, Sharad Yadav, tried to intercede and resolve the problem in a friendly manner but the Pakistanis were just unwilling to sit down for any talks,� Naqvi said.

When India stopped all flights in a tit-for-tat decision this year, PIA seems to have decided to get rid of all its Indian staffers, not just five. �We came to know of this and decided to move court protesting the arbitrary order,� Naqvi said.

Although the Tis Hazari sessions court issued an injunction on January 15 on the basis of the petition filed by Naqvi and his colleagues, the airline went ahead and sent sack notices to all employees and asked them to give up all keys and other important papers.

�All this is arbitrary. After all, there is still work to be done. The GSAs are doing it. And then everyone knows that after some time things will cool down and both countries have to resume air links,� Naqvi said.

The International Air Transport Authority has reprimanded both countries for snapping air links and is likely to force them to resume services later this year.

�Let�s pray, inshallah, this happens,� said Naqvi, using the expression jocularly used to expand the PIA acronym.


New Delhi, Feb. 6: 
The largest organisation of government employees decided to take to the streets. The stock market gave a 116-point salute. Industry hoisted the welcome sign to the return of reforms. The Congress hemmed and hawed. The CPM raved and ranted. And the BJP waited and watched.

A day after the feast of economic decisions, the Confederation of Central Government Employees raised the first flag of rebellion in protest against the voluntary retirement proposal, but if the BJP had gambled on the blockbuster package being vote-neutral in the upcoming elections in Uttar Pradesh and three other states, it could be proved right.

The biggest Opposition party Congress found its hands tied in making capital out of what is an unpopular decision � the voluntary retirement scheme for government employees � because it cannot disown parentage. Downsizing government is a slogan it had minted.

Somewhat surprised � like many � by the wide sweep of the decisions, the party said it had no objection �in principle� to the VRS, but would wait to read the fine print. Not surprising was the CPM�s criticism, accusing the government of �imposing� the VRS on employees. It stands shoulder to shoulder with the confederation whose programme of agitation starts rolling on the day the railway budget is presented, February 26, reaching its peak on March 14 in countrywide protests.

�The prices at which the government equity in IBP and VSNL has been sold constitute a big bonanza for the private sector,� the CPM�s politburo said, possibly missing the fact that IBP has been sold to another public sector company, Indian Oil.

The Congress found the sale of government equity in one public sector unit to another incongruous. Spokesman Jaipal Reddy said: �It shows lack of uniformity and objectivity in the government�s decision to allow public sector Indian Oil Corporation to bag controlling stake in another public sector company, IBP.� He asked why public units were not allowed to bid for Videsh Sanchar Nigam Ltd, describing the financial year-end disinvestments as a desperate attempt to cut the fiscal deficit.

Senior party leader and former finance minister Pranab Mukherjee found nothing �special� in the timing of the measures, arguing that international pressure to keep a runaway fiscal deficit under control had compelled the government to act. From its sale of equity in IBP, VSNL and four hotels, the government is picking up some Rs 2,800 crore.

Tapan Kumar Bhaumik, senior adviser, policy, of the Confederation of Indian Industry agreed, citing that the fiscal deficit was way above target in the April-December period.

He pointed out that the decisions had been announced immediately after finance minister Yashwant Sinha�s return from the congregation of business leaders and policy-makers at the World Economic Forum in New York.

�Disinvestment is the most visible and easily understood reformist step in the West,� he said.

Downsizing is another. Within the country VRS could turn out to be an explosive issue, but Bhaumik pointed out that it is not immediately clear how the government will go about implementing the programme of cutting 5 per cent of the workforce.

He saw no rush either in disinvestment, which had been scheduled. Besides, the two companies selected for sell-off are non-controversial and, therefore, politically safe. The Congress� muted reaction � in sharp contrast to the stink it had raised during the Balco disinvestment � bears testimony to that.

The two decisions, together with dismantling of barriers to foodgrain movement and stocking, removal of wheat export restrictions and sugar decontrol, will restore at least some of the credibility the government has been steadily losing in the eyes of international and domestic business.

Had these decisions not been taken, the finance minister would have had to face the world in three weeks when he presents the budget with a report card dipped in red ink.

Since December, the Cabinet has been reviewing the promises that were made and not fulfilled. Sugar decontrol, freeing of movement of foodgrain and reforming the Essential Commodities Act were among the promises made last year. Downsizing has been a declared intention for some time now.

This is an opportune moment to push through these measures as inflation is running at under 2 per cent and foodgrain stocks are huge, making the government fully capable of absorbing any possible pressure on prices.

Yesterday�s decisions also free up the finance minister from the compulsion of burdening the budget with too many harsh measures. And the beauty of it all � as Bhaumik points out � is that the election in Uttar Pradesh, where the BJP�s stake is the highest, is not being fought on economic issues.


Calcutta, Feb. 6: 
The contours of the Left Front�s two-pronged strategy to contain the madarsa damage crystallised today with the announcement that an appeal would be issued to the minority community to set the record straight.

The public pronouncement followed an assertion by some leaders at a Front meeting that chief minister Buddhadeb Bhattacharjee had focused on the right issues when he spoke of some unauthorised madarsas being used for anti-national activities.

The twin approaches conform to a party decision to allay possible misgivings of the minority community and monitor the funds flow to unauthorised madarsas.

Front chairman Biman Bose said the Left parties would appeal to the minority community to regard the Bhattacharjee government�s pronouncements in the light of ground realities and not as a policy measure.

CPM officials said they had begun working on the text of the appeal. �We should be able to make the appeal in a fortnight�s time,� a leader said.

At the lengthy Front meeting today � where the smaller partners criticised Bhattacharjee in front of the CPM leadership for his comments on madarsas � Bose said neither the Front nor the government was concerned with religious teachings.

The meeting also counselled Bhattacharjee to dissociate himself and his government from the controversy. Several senior leaders, including Jyoti Basu, called for �sympathetic and delicate handling� of the issue.

The leaders did not find fault with the content of Bhattacharjee�s comments. �But the party and the Front have not liked the way he chose to go public about the sensitive issue,� Bose said.

It was a fact that many in the minority community still did not want �mainstream� education, Bose reportedly said at the meeting. �But why should we have anything to do with that?� he asked. �Do we take any action against the Saraswati Vidyamandirs run by the RSS and the Ananda Marga-controlled educational institutions?�

Taking advantage of the mood at the meeting, the CPI pushed through a long-standing demand of setting up a core committee of ministers.


Karachi/Islamabad, Feb. 6: 
The kidnap trail of Wall Street Journal reporter Daniel Pearl has reached the Kandahar hijack.

Pakistani police today said they had narrowed their search for the scribe to the banned Jaish-e-Mohammad and were chasing senior leader Sheikh Omar Saeed, who allegedly directed his henchmen to e-mail Pearl�s pictures to newspaper offices after he went missing late last month.

Sheikh Omar is one of the three militants � apart from Masood Azhar and Mushtaq � freed from a Kashmir jail in December 1999 to secure the release of the Kandahar hostages.

The Pearl case has assumed significance for India because of the alacrity with which Pakistan agreed to extradite another suspect in the abduction to the US. Mubarak Ali Shah Gilani is expected to be sent to the US on charges of receiving funds from unnamed American outfits.

If Sheikh Omar is arrested, a parallel could be drawn, raising the possibility of his extradition to the US. India, which has been toying with the idea of third-country handover of wanted suspects, can then step in and ask the US to send Sheikh Omar to Delhi. Police last night picked up three persons � Adeel, Fawad and Salman � after raids in Karachi and Lahore on suspicion that they had mailed Pearl�s pictures. The trio confessed soon after that they had worked on Sheikh Omar�s instructions.

�We are hunting Sheikh Omar, who is directly involved in the kidnapping of the US journalist, and we hope to arrest him soon,� a senior police officer in Islamabad said. �It�s a major breakthrough for us and we are confident that we will be able to reach Pearl soon.�

British-born Sheikh Omar, a graduate of the London School of Economics, is a close associate of Jaish founder Masood Azhar, one of the terrorists on India�s most-wanted list.

Police have thrown a dragnet around many Pakistani cities in search of Sheikh Omar. Sources said many of his relatives in Lahore have been taken into custody. Police believe that though he stays in Karachi, he is holed up in Lahore itself.


Lucknow, Feb. 6: 
Digest this: 20 per cent of the candidates in the fray in the Uttar Pradesh elections have criminal records.

In the 403 constituencies of the state, 1,100 criminals are in the reckoning, ready to don the mantle of legislators.

In a reflection of the wretched times, top police officials in Uttar Pradesh have divided the candidates into two categories � politicians who are criminals and criminals aspiring to be politicians. They have gleaned the shocking statistics, put them on a list and submitted it to the Election Commission to enable poll officials to keep a tab on the tainted nominees.

Police and the poll panel say it is the unprecedented circumstances of these polls that have necessitated such a drastic step. While parties in Punjab have kept out people with police records, there is barely a constituency in Uttar Pradesh where criminals are not fighting it out.

Aware of the influence wielded by these goons in their respective areas, all the parties have scrambled to hand tickets to these �bahubali ummeedwars�.

The Samajwadi Party is trying to muscle its way to power by fielding as many as 156 such candidates. The Bahujan Samajwadi Party has adopted 107 criminals and the BJP follows closely with 82 tainted candidates. The Congress has 65.

The police report states that of the 1,100 candidates with police records, at least 327 have been booked for serious crimes, including murder, extortion, kidnapping, smuggling, dacoity and gun-running.

Heading the rogues� gallery is the Samajwadi candidate from Mishrik, Om Prakash Gupta, who has 70 cases against him.

With nearly 20 per cent of the 5,533 candidates named in criminal cases, the Election Commission is understandably worried. Chief election officer Noor Mohammad says the poll panel will identify the most hardened of these criminal-candidates and record their campaign on camera. The poll officials are also thinking of capturing on film the poll activities in the most sensitive constituencies like Maudaha, Gonda and Kanpur.

But with 34 criminals fighting it out in Gonda, 34 in Allahabad, 33 each in Agra and Bareilly, 32 in Deoria and 28 each in Gorakhpur and Kanpur, even poll officials accept there is little they can do except hope for the best.


New Delhi, Feb. 6: 
The government today relaxed norms for taxing the perquisites of those earning up to Rs 1 lakh a year by leaving non-monetary perks out of the tax deduction at source (TDS) net.

It also exempts airline and railway employees who get free or concessional tickets from paying tax on these perquisites. The relaxations are valid only for the current fiscal year.

Non-monetary perks could include housing accommodation, cars, food coupons or free education, gas and lighting. But tax consultants said the exemption would not be of great help as most executives who get such perks earn far more than Rs 1 lakh a year.

�But if this continues, many companies could change salary structures where monetary components would be reduced and non-monetised components raised,� analysts said.

The tax relaxations were notified today under Section 192 of the Income Tax Act. The notification is expected to help reduce the work of the income-tax department, which is still calculating what is taxable and what is not after the last budget�s announcement that perks are taxable.

The clarifications supersede the circular issued by the Central Board of Direct Taxes on December 12, 2001.




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