Mumbai, India (Observer): A decade ago, Chandrakant's fishing village in India's financial capital Mumbai lived mostly by candlelight. What people did not have — electricity — they stole. It was easy enough to hook onto the two thin power lines that passed over the village and take a little for themselves.

Today, his settlement has moved up the feeding chain of Mumbai neighbourhoods and most residents have city electricity meters. But the loose habits of the past persist. Residents still steal power on special occasions, weddings or funerals that need to be lit brighter than their home meters can bear.

An electrician like Chandrakant — who asked that his full name and that of his neighbourhood not be revealed because of his illegal activity — just hooks onto one of four main distribution lines in the village, with the quiet approval of local officials. India's power sector is lousy with thieves. Men like Chandrakant are the least of them.

As much as 40 per cent of the power generated in India is not paid for. The bulk of it is stolen. If that seems unsustainable, it is. India suffered the worst blackouts in history this week, which left over 600 million people without power. The lights are back on, for now, but the crisis is evidence of deep problems in a sector teetering on the edge of bankruptcy for the second time in a decade.

Investigators have yet to pinpoint the cause of this week's shutdowns. Early, contested reports suggest states were drawing more than their share of power. Scanty rainfall has driven up demand, as farmers switch on electric pumps for irrigation, and crimped hydroelectric supply, which generates about 20 per cent of India's electricity.

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Editor's note: The following is the full text of the press release from the IMF on the disbursement of US$ 4.76 million to St. Kitts and Nevis under the standby arrangement.  

The Executive Board of the International Monetary Fund (IMF) today completed the third review of St. Kitts and Nevis’ economic performance under a program supported by a 36-month Stand-by Arrangement (SBA). The completion of the review allows the immediate disbursement of an amount equivalent to SDR 3.16 million (about US$ 4.76 million), bringing total disbursements under the arrangement to SDR 39.94 million (about US$ 60.21 million).

The Executive Board also approved a request for waivers of applicability for the end-June 2012 performance criteria. These waivers were necessary because the Executive Board meeting was scheduled to take place after end-June but prior to the availability of data to assess the relevant PCs.

The SBA was approved on July 27, 2011 (see Press Release No. 11/295), for an amount equivalent to SDR 52.51 million (about US $79.15 million), or 590 percent of St. Kitts and Nevis’ IMF quota.

Following the Executive Board’s discussion, Min Zhu, Deputy Managing Director and Acting Chair, issued the following statement:

“While the outlook for the St. Kitts and Nevis economy is for a moderate recovery, weaker domestic activity and the persisting difficult global environment pose challenges. The authorities are continuing to successfully implement their Fund-supported program and remain committed to the sound macroeconomic policies and sustaining the pace of structural reforms.

“The authorities have made further progress on restructuring the public debt and have reached an agreement with Paris Club creditors. Similar negotiations with other bilateral creditors will be necessary to secure debt sustainability. The debt-land swap has also advanced. Key priority now is the swift operational implementation of the Special Purpose Vehicles (SPVs). It will be important to align the governance structure and staffing of these SPVs with best international practices to ensure transparency and accountability. Successful completion of debt restructuring will yield debt service savings, which will help shore up the fiscal position.

“Continued successful program implementation and the achievement of medium-term fiscal targets will depend on a sound macroeconomic framework, including further broadening the tax base, strengthening revenue administration, and improving the efficiency of public spending. Reforms in public financial management will help enhance the quality of adjustment and provide the fiscal space needed to accelerate growth-enhancing expenditures, particularly public infrastructure investment.

“The financial sector remains healthy and adequately capitalized. Continued close monitoring and collaboration with the Eastern Caribbean Central Bank to address any repercussion of the debt-land swap and debt rescheduling on banks’ liquidity and profitability should be an important priority.”

 

LIAT’s recent decision to purchase new passenger jets that will replace the ageing Dash 7 and 8 de Havilland aircraft is welcome news for many companies in the aircraft production business. For regular travellers and other airline customers, it is also good news, since the new acquired aircraft will have increase passenger capacity, better fuel consumption and greater technological capacity that will ultimately contribute to improved regional air safety.

The ageing Canadian de Havilland fleet that is estimated to be over 20 years old has served the region well in varying diverse areas. The regional airline has been quite fortunate in having in its employ a competent group of pilots and aircraft maintenance mechanics. The de Havillands also have an excellent air safety recordnot only in the Caribbean region but extending to Northern Canada, various parts of Africa and Latin America. 

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What are some of the ways in which you can be held captive by the shackles of financial bondage? If you're finding it hard to afford even the basic necessities of life, you may feel distressed about your inability to provide for your family. If you borrow to finance your expenses, you will eventually become trapped in a never-ending cycle of debt. If you become desperate about your problems, then deep-seated fears about money can develop that may prevent you from finding solutions.

For this month's money mission, let's look at some of the ways to break free of these issues that can inhibit your financial progress.

Freedom from financial hardship

For most people, their main money concern is not being able to make ends meet on their current salary. Living hand to mouth, there is little enjoyment in life as all their income has to be directed into paying bills. They are often just a pay cheque away from financial collapse, as they have no money put aside to deal with emergencies such as illness or loss of job.

In today's economy, it is challenging for most people to earn enough from their regular occupation. Factor in the masses of persons who have been laid off or are unable to find work, and it becomes clear that you can't depend solely on traditional forms of employment to supply the daily bread to meet your needs as well as the butter to satisfy your wants.

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TCI (Caribbean News Now): While the value added tax (VAT) has been rushed through the Consultative Forum and the Advisory Council and passed into law, the Turks and Caicos Independent Business Council (TCIBC) continues to fight its implementation. The law is due to go into effect at the beginning of the next fiscal year, April 1, 2013.

No sooner had the VAT bill been signed into law by acting governor Patrick Boyle on the previous Thursday than TCIBC called an open meeting on the following (last) Tuesday, July 24, to discuss why the law is not appropriate for the Turks and Caicos Islands. Detractors also took out a full page advertisement in local newspapers to promote the meeting. Chairman of the council, attorney Clive Stanbrook QC, then had a follow up press conference last Thursday, to discuss how islanders can band together to fight VAT.

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