Thursday, May 27, 2004



India goes cool on privatisation
India's new government has scrapped key elements of its predecessor's privatisation programme.
The communist-backed coalition, led by the Congress party, said in a policy statement that it would not sell off profitable state-run firms.
Privatisations of loss-making firms would be decided "case-by-case".
Last week, Indian share prices posted a near-record slump amid fears that the new coalition would reverse the BJP government's economic reforms.
The prospect of slower progress on reform has also spooked foreign investors, who have sold some $800m worth of Indian shares so far this month.
Privatising some of India's profitable state enterprises in the energy and heavy engineering industries formed a central plank of the BJP government's economic agenda.

Fiscal pressure
The new government's policy document pledged to raise spending on education to 6% of gross domestic product, and to encourage more foreign investment in the oil and energy sector.
It also set a target for annual growth of between 7 and 8%.
Economists said the new coalition's economic blueprint could put India's already overstretched public finances under added pressure.
"How will the increased spending on education be funded?" said Kishlaya Pathak, economist at Standard Chartered Bank.
"This is crucial because our fiscal situation is a matter of concern."
India's central government deficit stands at about 5% of gross domestic product, prompting warnings that the country must do more to balance its books.
There are fears that without the proceeds of further privatisations, or deep public spending cuts, the budget black hole could widen sharply.
Cutting public spending - much of it in the form of politically sensitive subsidies and non-negotiable interest payments on public debt - has proved an unpalatable option for most Indian governments.

Markets calm
Bombay's leading share index closed half a percentage point lower on Thursday shortly before the new policy agenda was unveiled, but analysts said the market would take the news in its stride when it reopened on Friday.
"The market has already reacted to the likely slowdown in reforms," said K K Mittal, fund manager at Escorts Mutual Fund in New Delhi.
The economic policy agenda was thrashed out in talks between the Congress party, the senior partner in the new coalition, and its allies, which include two communist parties.

The new coalition, entitled the United Progressive Alliance, won a surprise election victory two weeks ago over the BJP government.
Led by Manmohan Singh, a former Indian finance minister, the United Progressive Alliance won the contest thanks to the support of poor rural voters.
They felt the BJP's economic reforms had enriched an urban elite without delivering tangible improvements to the broad mass of the Indian people.
Analysts said the acid test for the new government's economic policies would come later this year, when it unveils detailed tax and spending plans in its first budget.
But the appointment of Mr Singh - the architect of a highly successful economic overhaul during the mid-1990s - as prime minister has helped soothe investors' nerves.
Mr Singh was named prime minister last week after Congress party leader, Sonia Ghandi, declined to take on the role.
Source; BBC News, May 04

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Get on China's economic train: ASEAN-China cooperation on fast track
A report by Research Center of Thai Farmers Bank, Thai authoritative economic research institute, shows, Association of Southeast Asian Nations (ASEAN) has seen fast trade growth since the launch of the "early harvest" plan within the framework of China-ASEAN Free Trade Area in January 2004. Export, for instance, grew by 14 percent in the Philippines, 7 percent in Malaysia and Indonesia, 5 percent in Singapore, and 22 percent in Thailand. Plus, China and ASEAN countries' related trade negotiations ended ahead of schedule with extensive consensus reached. This shows the "10+1" Free Trade Area jointly advocated by China and ASEAN has made a big way ahead and is full of vigor.
ASEAN countries are China's neighbors and developing countries as well. Developing mutually beneficial cooperation with ASEAN and seeking for long-term stable development in relations with ASEAN is in line with China's interest and beneficial to the overall revitalization of Asia.

In recent years, mutual political trust constantly strengthened, economic exchanges increasingly grew and cooperation turned more and more fruitful. Bilateral trade between China and ASEAN has been growing by 15 percent since 1995. In 2003, it grew by 40 percent to a new high of US$ 78.2 billion, in which China imported US$ 47.3 billion from ASEAN, a 50 percent rise. Presently, ASEAN has become China's fifth largest trade partner, and China the sixth of the ASEAN.

The "early harvest" plan under the framework of China-ASEAN Free Trade Area implemented in January 2004 further pushed trade growth in Asia. For Thailand alone, Sino-Thai trade heralded in agricultural produce. Since China and Thailand initiated zero tariffs for vegetable and fruit on October 1, 2003, such trade rose rapidly. It has not only greatly promoted bilateral trade, but also provided new commercial opportunities for the enterprises of the two countries with materialized benefit.

Statistics show, in January to March 2004, vegetable trade between the two countries totaled US$ 114 million, in which China exported to Thailand commodities worth of US$ 13.98 million, a year-on-year rise of 87.84 percent, meanwhile China imported from Thailand US$ 99.63 million, a year-on-year growth of 143.42 percent. Official with Thai Ministry of Commerce said that Thailand is actively pushing free trade in other commodities, and is striving to realize zero tariffs in fish and milk products in 2004, and industrial products in 2005. Currently, national economies of China and Thailand have been growing fast, bilateral trade, investment and economic cooperation intensified.

China's sustained and fast economic growth maintains a vigorous momentum of interregional trade in Asia. It is predicted at the ASEAN Finance Ministers' Meeting in Singapore on April 7 that the average economic growth rate in ASEAN countries will be 5.05-5.09 percent. Singapore scholar held, for ASEAN countries, to establish China-ASEAN Free Trade Area is conducive to catching up with China's economic high-speed train and to making sure that the ASEAN continue to play the role as an important economic zone. This is agreeable to its own interest.

Negotiations on China-ASEAN Free Trade Area started early 2002. In November 2002, the two sides signed framework agreement on economic cooperation, and decided to realize step-by-step free trade with zero tariffs. According to "early harvest" plan, over 500 kinds of commodities, mainly agricultural produces, will have reduced duties and to zero by 2006. Till 2010 when China-ASEAN Free Trade Area is established, there will be an economic area with 1.7 billion consumers, a Gross Domestic Product (GDP) of two trillion, US$ 120 million economic aggregate. It will be the most populous free trade area, the largest one composed of developing countries.

In spite of a wide gap in economic development, different economic development stages among the ASEAN members, as well as their goals and acceptability, challenges will be conquered and mutual benefit realized as long as the two sides have negotiations with equality, seek common grounds while shelve the differences. Just as Indonesian President Megawati Soekarnoputri put it, ASEAN-China cooperation has growing increasingly mature, and it is hoped that the dialogue partnership in trade, investment, technological cooperation, culture and society can be further enhanced to promote regional stability and prosperity.

Now China-ASEAN cooperation has made a breakthrough with marked harvest: the trade volume between China and Thailand in the first quarter of 2004 alone has exceeded US$ 3.8 billion. Singapore Deputy Prime minister Lee Hsien Loong stressed in his recent visit to China, the agreement on free trade area is a significant step forward and Singapore will have negotiations with China on free trade in 2004 to further push "10+1" Free Trade Area. With regard to the prospect, China-ASEAN Free Trade Area will be sure to maintain a constantly fast pace forward.
Source; by People's Daily Online, May 04

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Afghan troubles will test Nato's quest for new role
The timing for next month's Nato summit in Istanbul could not be worse. The issues supposed to dominate the two-day meeting and show how Nato is finding a role in the post cold war era are turning out to be uncomfortable.
In Afghanistan, the 26-member alliance is hard-pressed to provide a medical corps or a few transport helicopters for the 6,500-strong Nato-led International Security Assistance Force.

Its ambitions to develop its own Greater Middle East Policy have been lowered as Washington dilutes its grand plans for the region. Summit invitations to leaders from north Africa and the Middle East have been dropped.
Discussion over Nato's future role in Iraq will also be limited, as world leaders focus on the handover of sovereignty two days later. So it is hardly surprising that the atmosphere at alliance headquarters in Brussels is gloomy.

But Jaap de Hoop Scheffer, 56, the Dutch politician who last January took over the helm of Nato, is not. As secretary-general, he seems determined to make a virtue out of necessity at Istanbul.

"There is no room for gloom," he says in a Financial Times interview. Indeed, Mr de Hoop Scheffer intends to raise more uncomfortable issues in Turkey, using the example of Afghanistan, Nato's first "out of area" mission, to spell out his plans for transforming the alliance. One is the military planning for missions, the other is how they are financed.

When Nato agrees on a mission, military planners call for "a force generation" conference where nations are asked what they can provide.
Separately, Nato's overall "force planning system" has a huge inventory of helicopters, tanks, troops and aircraft. None, however, is immediately available for specific missions.

"It is not easy to generate forces," says Mr de Hoop Scheffer. "There is a dis-connect between the force planning system and the way we generate our forces. When we enter into the political commitment, we have to know what forces we can generate to honour that commitment."

In an ideal world, some Nato military officers would like a nation to commit a fixed set of capabilities, allowing the planners easy access. As a former foreign minister, Mr de Hoop Scheffer knows this is unrealistic.

"Sending out forces to missions is always a decision that involves national sovereignty," he explains. "If we can find a solution between the disconnect of force planning and force generation, we will not deny the Dutch, the Poles or anyone else [the right] to make their national decisions."
The secretary-general says a review of how missions are financed might bridge the gap between the big, elusive toolbox and what nations actually contribute for peacekeeping missions.

Missions are financed on the basis of "costs lie where they fall", with each nation responsible for all equipment and personnel it deploys abroad. "The 'costs lie where they fall' is a principle that should be fundamentally discussed because it means certain nations that always have the assets will always be asked to deliver," says Mr de Hoop Scheffer.

He would, for example, like to see more common funding for the essential capabilities Nato needs for most missions: heavy airlift, transport helicopters and medical facilities - exactly the shortfalls in Afghanistan. A dozen or so nations finance Nato's Awacs, the early warning airborne control system. And a handful of European countries are funding the A400m heavy transport aircraft.

"We need to think more about common funding. We have to try to be inventive," says Mr de Hoop Scheffer.
The structure of defence budgets are another problem. "Some countries have one defence budget from which you have to finance peacekeeping operations and new weapons systems. I think. . Peacekeeping operations should not be charged to the defence budget," he says.
He does not expect Istanbul to deliver such ambitious aims. Instead, with Afghanistan as the catalyst and the big test for Nato's ability to operate out of area, he hopes to get the green light to start debate.
Source; FT, May 04

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Opposition leaders make unity effort as Kyrgyzstan prepares for election season
A new movement in Kyrgyzstan is advocating transparent parliamentary and presidential elections in 2005. At the same time, participants in the new group openly hope it develops into an opposition vehicle that can mount a challenge President Askar Akayev’s hold on political power.
The group, calling itself the Union for Fair Elections (UFE), came into being May 20. At its core are several prominent opposition parties, including Ar-Namys (Honor), led by jailed Akayev rival Feliks Kulov, and the Social Democrats. Although dominated by the opposition, UFE leaders sought to portray the union as having a middle-of-the-road agenda. People’s Party leader Melis Eshimkanov, for instance, said the union would strive to act as “a third political force between the authorities and the opposition,” according to a report by the KyrgyzInfo news agency.

Perhaps the most surprising UFE participant is Misir Ashirkulov, who had been a member of the president’s inner circle of advisors. Ashirkulov was reputedly a leading centrist in Akayev’s administration, who, during the height of political tension in 2002, reportedly counseled that the president take a conciliatory approach toward the opposition. [For background see the Eurasia Insight archive]. His decision to join UFE suggests that he lost a struggle against hardliners within the administration for control over the administration’s policy agenda. [For background see the Eurasia Insight archive].

“Today we are uniting for real action, with good intentions, despite differences in our political views or party platforms,” said a UFE statement issued May 20. “We are ready to cooperate with all citizens who share our thoughts, aspirations and our position.” The appearance of the fair election union creates a headache for Akayev, who has come under fire in recent years for abandoning a democratic reform course. [For background see the Eurasia Insight archive]. A report by the AKIpress news agency on May 25 said that Akayev, during a meeting with Deputy Assistant Secretary of State Lynn Pascoe in Bishkek, complained about the US assessment of democratic reforms. The president told Pascoe that “Kyrgyzstan needed more balanced coverage and due assessment by US official structures,” the AKIpress report said.

Akayev’s democratic image was not helped by his May 24 decision to relieve Ashirkulov of his duties as Security Council chief. Presidential aides insisted the move was not related to Ashirkulov’s UFE move. Most local observers, however, believe Ashirkulov’s dismissal was an act of political retribution.
The biggest question surrounding the upcoming presidential election in 2005 is whether or not Akayev will seek a third term. Akayev has repeatedly said he intends to retire, but he has left room to change his mind. [For additional information see the Eurasia Insight archive].

Kyrgyzstan’s presidential and parliamentary elections in 2000 were criticized as flawed by international observers. [For background see the Eurasia Insight archive]. Opposition leaders firmly believe that in a free and fair vote, they could win control of both the executive and legislative branches of government. Some participants say the UFE is designed to promote opposition unity with the specific goal of nominating a single candidate to run in the presidential election.

A variety of factors – including North-South sectional differences -- have helped keep the opposition divided to date. Akayev has often exploited the opposition’s fractious nature in his efforts to defend his political supremacy.

"We should be united to mobilize the electorate," Emil Aliyev, deputy leader of Ar-Namys, said in an interview with EurasiaNet. "Right now, there is a search for a leader. Possible candidates and their qualities are being discussed. It is important that the leader should be independent and should not be under pressure from other forces."
"We count on winning the elections if they are fair," continued Aliyev. "But I do not exclude that before the elections and during them unwanted candidates would be removed physically."

Given the uncertainty surrounding Akayev’s potential candidacy, some UFE members are hoping the opposition can get a jump on the presidential campaign. "The government does not have a distinguished person who could win the presidential elections in the first round," said parliamentary deputy Adahan Madumarov. "Therefore, the opposition is already [working towards] putting forward a common candidate. If we achieve that, we could demonstrate our power to authorities and to the people."
Many political observers believe the unified opposition’s candidate could turn out to be Ashirkulov. Other possible candidates include parliamentary deputy Kurmanbek Bakiyev, along with Madumarov and Omurbek Tekebaev.

Some observers suggest Bakiyev, a former Prime Minister, could be acceptable to Akayev as a “compromise candidate." Others doubt that Bakiyev enjoys much support in the presidential administration. One analyst stressed the sectional divide, pointing out that Bakiyev is a southerner while northerners dominate Akayev’s inner circle. A southerner’s rise to the presidency could unleash fresh, clan-driven political conflicts, the expert said. "They [Akayev’s aides] do not want a stranger entering their garden," the analyst explained. "[T] Hey would have to share influence, posts and property.”
Source; Eurasianet, May 04
Write; by Aigul Rasulova is a freelance writer based in Bishkek.

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Government plans to build another 1000 state houses
The Government plans to build another 1054 State homes and make improvements to another 856 with money set aside in today's Budget.
The Budget allocates $128.9 million over the next three years to Housing New Zealand Corporation to acquire new State houses.
This takes the total for next year for the purchase of new State homes to $232m.
The Government said details would be announced next week but the money would be spent buying 1054 homes and making improvements to another 856 houses for State tenants.
In 2003/04, some $320m was available to acquire housing stock and modernise existing homes.
Housing Minister Steve Maharey also today said further funding of $4.8m was being provided in 2004/05 to continue to repair substandard housing in Northland, East Coast and the Eastern Bay of Plenty.
The Ministry of Housing was getting $3.4m to extend the Residential Tenancies Act to boarding houses once legislation currently before Parliament was passed.
The Act defines the rights and obligations of landlords and tenants and sets out disputes resolution processes.
It will be reviewed with $700,000 allocated in the budget.
The ministry will use some of the $3.4m funding allocation to better inform landlords and tenants about trends in the rental market.
A database, costing $1.3m to set up, would allow people to access information about past Tenancy Tribunal decisions.
Source; NZPA, May 04

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Indonesia's oil giant gushes cash, seeks bailout
Indonesia's state-owned oil and gas company, PT Pertamina, is broke and it has asked for a government bailout, as excessive costs have put the company's operating cash flow, and the company's future, in critical condition.
Pertamina's expenditures currently are surpassing its income due to its obligation to meet domestic fuel oil demand with fuel oil bought on the international market at sharply inflated prices, a spokesman said.

"With a liquidity position below 2 trillion rupiah [US$215 million], the company is already bleeding," Pertamina's director of finance, Alfred Rohimone, told a hearing on Tuesday with the House of Representatives' commission on mines and energy.

At the end of April, Pertamina had cash reserves of less than $215 million, but the company's costs for importing crude oil and fuel products exceeded $540 million per month. The company's policy of making cash advance payments to purchase crude oil have also added to its loss of cash flow, Rohimone said.

As a result, the company, which imports some 300,000 barrels of crude oil and fuel products a day at international market prices, is on the brink of running a deficit, and has asked the Indonesian government to help it avert a crisis.

The country's current state budget has allocated some Rp14.5 trillion in fuel subsidies to Pertamina, based on an assumption of oil priced at an average of $22 per barrel. Pertamina should receive subsidy compensation for that entire amount, Alfred said, but in practice, with payments being spread over 12 months, the company only receives 70 percent of the total compensation.

At present, crude oil prices are hovering at a record high of more than $40 per barrel, and the government is scheduled to submit a revision to the 2004 state budget to the House of Representatives as early as July. At that level, according to Pertamina, the fuel subsidy could nearly triple to some Rp40 trillion ($4.35 billion), causing a larger deficit.

Pertamina has already had to spend Rp40 billion to buy crude oil at the price of $35 per barrel, Rohimone said. As a further consequence of the price rise, it has used Rp3.6 trillion of its monthly fee to the government to buy oil, he added.

"Pertamina must cover any shortage in payment with its own funds, Rohimone said. "But under the present unfavorable financial circumstances, the company may no longer be able to do so."

According to Rohimone, the company's current financial condition is largely linked to the previous management's policy of spending a huge amount of money to pay debts. The company had cash reserves of Rp23 trillion ($2.5 billion) in 2001, but said they were depleted through the repayment of government loans.

"The previous management in 2002 spent a lot of money to pay debts on several long-term projects. As a result, we are now broke," Rohimone said.

The lack of operating revenue has forced Pertamina to cancel several projects, and the company said it may liquidate three money-losing subsidiaries as part of its program to improve efficiency.

Pertamina has 14 wholly owned subsidiaries in various business areas including non-oil sectors. But based on an evaluation of the 14 companies, three of the subsidiaries will be liquidated and three others merged into other, better performing companies, Pertamina President Ariffi Nawawi said.

Pertamina also has decided to delay planned exploration activity in Iraq's Western Desert field until the United States has handed over legal and sovereign power to an Iraqi authority.

"We heard that the transfer of power will take place in June 2004. We will wait until this has happened," Pertamina's director of Downstream Industries, Bambang Nugroho, said on the sidelines of the meeting on Tuesday.

Pertamina had planned to begin its exploration activity in the Western Desert field in Iraq in March, but due to increased tensions in Iraq and reports that the US would hand over power to Iraqis, it has decided to postpone the plan's execution.

The company's losses, on top of costs that have exceeded government subsidies, have worsened Pertamina's economic health.

As a result, finance director Rohimone has forwarded several alternatives to the government to help overcome the company's rising deficit. Among them is a request for the government to pay Pertamina its marketing fee on time and to pay Pertamina the fuel oil subsidy compensation funds in advance, based on the actual price and calculations of asset reappraisals.

Rohimone has also asked that the government take over the company's obligation to pay tax and duties on public service operations.

"Short-term measures to cope with the financial crisis in Pertamina would be to release funds from the escrow account, a clear marketing fee [and] on-time payment of subsidy," Rohimone said. "A long-term solution would be improving the structure of the fuel oil price."

In addition, he said the company should review new investment projects, especially those that burden its cash flow.
Source; Asia Pulse/Antara, May 04

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Philippine GDP grows at fastest rate since 2000
The Philippines said its economy grew by 6.4 per cent in the first quarter from a year ago, the fastest rate since the third quarter of 2000, as farm output surged to record levels and construction activity recovered.
Higher personal consumption ahead of the May 10 national elections and modest growth in private sector investments also contributed to the better-than-expected expansion in the country’s gross domestic product. Analysts had expected output in the first three months to rise by only 4.7 per cent.
From the previous quarter, GDP grew by 2.2 per cent, the highest since the first quarter of 1999, according to the National Statistics Coordination Board, the government agency that compiles the national economic accounts.
President Gloria Macapagal-Arroyo, who is leading in the presidential elections by a slim margin according to unofficial tabulations of the vote, welcomed news that the economy did well in the first quarter. The strong economic performance "show that our economic policies and strategies are working," she said in a statement.
But the data failed to cheer stock market investors who were worried that higher gas prices and transport fares might prompt the central bank to raise interest rates during the monetary board’s rate-setting meeting next week. Share prices in the Philippines on Thursday fell by 0.57 per cent.
Romulo Virola, the government’s chief statistician, said economic growth in the first quarter was broadly based. Almost half of the 6.4 per cent GDP growth was contributed by services while 1.8 percentage points came from industry and 1.6 percentage points came from agriculture. He said investments in call centres and other business process outsourcing facilities have begun to pay off.
Mr Virola also said that first quarter farm output, which grew at its fastest in 15 years, benefited from good weather as well as recent government programmes to modernise the agriculture and fisheries sectors. He said rice production has been going up because of the introduction of new, higher-yielding hybrid varieties and the rehabilitation of irrigation facilities.
Source; FT, May 04
Write; by Roel Landingin in Manila

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Soaring Oil Prices Pressure Airlines to Raise Ticket Prices
Domestic and international flight fares will be raised following a hike in international oil prices and decline in number of passengers since the launch of the bullet train, according to the Ministry of Construction and Transportation on Thursday.
The two national flag carriers, Korean Air and Asiana Airlines, were reported to have recently asked the ministry for permission to gradually add $2-$13 in surcharges to international flight fares if oil prices continue to rise.
The ministry said it is difficult to approve the request. But it has recommended the airlines increase market prices of air tickets, which are usually lower than permitted prices.
The airline companies plan to apply for permission again.
In March, the ministry had approved a hike in the ceiling of the ticket prices for international flights flown by the two national flag carriers by up to 7.7 percent.
Domestic flight fares will also increase starting July 16. Adjustment in domestic flight fares is totally up to airline companies, which are only required to notify the ministry of changes 20 days before the implementation.
Korean Air announced it will raise the fares by 8 percent for weekend flights and 13 percent for flights during high-demand seasons. It will also combine discounts for middle school students, high school students, and university students, into a single discount for youth between 13- and 22-years-old.

Asiana Airlines is not considering a raise in flight fares yet.
The fare raise plan has resulted from soaring crude oil prices. The average oil price for aircrafts during January to April has increased by 22 percent to $40.3 per barrel from $33 last year.

The ratio of oil costs among the total expenses of air companies was 18 percent for Korean Air and 21 percent for Asiana Airlines last year. If the oil price increases by $1 per barrel, Korean Air may shoulder an additional $25 million with Asiana Airlines assuming $13 million.
The high-speed train, which started running April 1, is another factor for flight fare increases, as passengers to and from Kimpo Airport to local airports in Kimhae, Taegu, Kwangju, and Mokpo declined by 35.2 percent to 412,000 in April from 635,000 a year ago.
The total number of flights has also decreased, with Asiana Airline reducing the number of flights between Kimpo and Kimhae from 16 to 11 per week, and between Kimpo and Taegu from eight to two.

``To promote air industry and attract more passengers, we reduced the time for security checks by placing more monitoring machines, and cut the fees for parking lots at Kimpo Airport. We’ll also prepare business rooms in the airports as well as set a special department specifically for services such as cutting the waiting time for baggage,’’ a Korea Airports Corporation official said.
Source; Korea Times, May 04
Write; by Kim Rahn Staff Reporter

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Anna Molka’s paintings go on display
Lahore: An exhibition of paintings by Professor Anna Molka Ahmed, the pioneer of art education in Pakistan, will open at the Shakir Ali Museum today. Punjab Governor Khalid Maqbool will open the exhibition being organised by the Pakistan National Council of Arts. The late Ms Ahmed had been an eminent teacher at the Punjab University and founded the Pakistan National Council of Arts. She was a versatile artist whose work covered landscapes and figurative and thematic paintings. The PNCA says her paintings should be considered national assets. The exhibition runs through June 28.
Source; Daily Times, May 04
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India's bid to boost healthcare in slums
In this small commercial city, two worlds sit side by side. One side is the comfortable middle class. The other - tucked into alleyways or barren lots - are slums that look like a scene out of Mad Max: low-roofed tin huts; wild-haired children walking naked.
For centuries, these two worlds have been symbiotic. Slums provide housecleaners, cooks, and drivers for the middle class. The middle class, meanwhile, tolerates the slums as a source of cheap labor.

But this system is buckling under the pressure of India's burgeoning urban population, particularly over issues of health. Urban slums are the fastest-growing sector of India's population, expanding five times faster than rural areas. How the government deals with this problem could have widespread implications, both for the country's ability to attract foreign investors and to convince upwardly mobile citizens that life is safe enough to remain in India.

"When you analyze the urban slums and the statistics that slums will be growing at faster rates than other [areas], this is a serious concern," says Prasan Kumar Hota, secretary of family welfare in the Indian Health Ministry.
Urbanization is a global phenomenon. In wealthier nations, most citizens already live in major urban areas or suburbs. But for poorer countries, the epic migration of villagers to cities is straining clean water supplies, sewer systems, and hospitals. Of the roughly 2 billion people to be added to the world's population over the next 30 years, more than 90 percent will be living in the cities and towns of poor countries, according to The Challenge of Slums, a recent report by the UN agency Habitat.

In India, there is a cruel twist. Decades of rural programs have brought clinics and healthcare to villagers. But now villagers are often leaving behind better healthcare in search of better jobs. In a recent survey in the state of Gujarat, for example, researchers found that 60 percent of surveyed villages had vaccinated their children, compared with 30 percent of slum dwellers.

A small collection of government bureaucrats, private volunteer groups, and feisty community leaders are starting to address the imbalance, one slum at a time. Here in Indore, an innovative pilot program - funded by USAID and run by private healthcare advocacy groups - is helping slum dwellers improve their own health conditions. With limited funding, this program chose 75 of the most vulnerable slums (out of 543), and focused first on education.
"The most important thing is to deal with the sense of resignation that you find among most Indian slums," says Siddharth Agarwal, executive director of Environmental Health Project (EHP), a private aid group in New Delhi leading the Indore project. "These people should be the implementers. We may be wonderful doctors, but we will disappear one day, so if a program is able to train five people in that community, then the effort can be sustained."
Training includes lessons on good nutrition, safer birthing methods, better sanitation, proper disposal of waste products, and proper hygiene, such as washing hands before food preparation. Some slum dwellers are learning how to demand access to drinking water and affordable health clinics.

The irony, says Mr. Hota, is that both politicians and villagers assume that the issue of urban healthcare will just resolve itself. "Somehow we all expect that urban poor, with higher incomes, higher number of doctors and hospitals, should be able to take care of themselves. But that is not true."

In fact, says Mr. Agarwal, 71 percent of the slum dwellers in Indore go to private doctors, "many of whom are not licensed, and all of whom are expensive."
In Professor's Colony here in Indore - a neighborhood of modern concrete homes near the university - a band of women - middle-aged, poor, and barely literate - are educating themselves now on how to prevent health problems.
Every few weeks, they meet with tutors from EHP in an effort to prevent illnesses that can devastate a poor family. During hot afternoons, during times that used to be reserved for gossip, the women share what they learn with other women in the area.
Tara Bai, a 60-year-old who came to Indore 30 years ago, has learned more about childbirth in the last year than in all her life. Before, improper practices in washing babies after birth meant that more than half would die overnight from hypothermia. Before, mothers didn't use a sterilized string to tie the umbilical cord; many children died of infections.

Today, infant mortality in Tara Bai's slum has dropped dramatically.
"We've had 8 to 10 births so far this year, and no deaths," she says. Her hut has become a meeting place of sorts for the 100 families of this slum. "If God gives light to you, you should know how to use that light."
Best of all, Tara Bai says, this education is portable. So if city officials carry out threats to remove this slum, Tara Bai says, "I know how to go to a new slum and organize it; I can do it again."

Across town, in a slum at the city's scruffy edges, Shanta Bai (unrelated to Tara) has also been taking courses in healthcare, and improving the lives of her neighbors. (Bai is a common last name for Indian women here; it means wife in Hindi.) Shanta Bai comes from one of the poorest communities in Hindu society, the caste of rag pickers, who collect and sort trash for recycling. She's illiterate, but acts as a community pillar.
"This slum has been moved three times in 15 years," she says, adding that she was born into an Indore slum 60 years ago. "But there is a support system here. We look out for each other."

She says her training has made her better prepared. "Before the class, I was blind. I would never have realized ... that we could do all this together," she says. "It's opened my eyes
Source; The Christian Science Monitor, May 04
Write; by Scott Baldauf | Staff writer of The Christian Science Monitor

Mangi Lai sits with his son in his tent in Indore, India. Sanitation is a growing problem
in urban slums.
Picture; by Scott Baldauf

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