Kashmir dispute, communal strife 'risks' to India investment

May 21, 2017

New Delhi, May 21: A number of large foreign funds, managing trillions of dollars of investor assets globally, have flagged 'persisting religious conflicts' and 'Kashmir dispute' as potential risks to their investments in India, saying such "tensions" could destabilise the Indian economy.

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JPMorgan, one of the largest wealth managers in the world with asset under management of over USD 1.7 trillion, alone has flagged these "religious and border disputes" regarding investments in India in at least eight regulatory filings made by its various funds so far this month.

Besides, a number of other funds, including the India Fund managed by Aberdeen Asset Management which has over USD 380 billion of assets under management, have listed similar "risks" in their regulatory filings made with the US Securities and Exchange Commission (SEC).

Other such funds include Eaton Vance Greater India Fund, Mathews International Funds, Alps Funds (Financial Investors Trust), Franklin Templeton International Trust, Global X Funds and iShares Trust (managed by BlackRock Fund Advisors).

Besides, Wasatch Funds Trust, Arthur J Gallagher & Co and Causeway Capital Management Trust have also flagged similar concerns. Similar concerns have been flagged by a few funds regarding Pakistan also.

When contacted, senior officials at some of these funds and other experts said such 'risk factors' follow a generic pattern in regulatory filings by various companies and investors and not much should be read into them, but they admitted that religious conflicts and Kashmir dispute remain an overhang.

They refused to be named citing regulatory issues and due to "sensitivities" involved in such matters.

While cross-border tension continues in Kashmir region, the Indian government has been trying to send across a positive message to the world and some saw hosting of the GST Council meeting in Srinagar last week as a step in that direction.

In a filing made by JPMorgan Trust II on May 18, the fund said, "Political and economic structures in India are undergoing significant evolution and rapid development, and may lack the social, political and economic stability characteristic of the US."

It further said, "Religious and border disputes persist in India. Moreover, India has from time to time experienced civil unrest and hostilities with neighbouring countries such as Pakistan. The Indian government has confronted separatist movements in several Indian states.

"The longstanding dispute with Pakistan over the bordering Indian state of Jammu and Kashmir, a majority of whose population is Muslim, remains unresolved. If the Indian government is unable to control the violence and disruption associated with these tensions, the results could destabilise the economy and consequently, adversely affect the Fund's investments."

Similar filings have been made this month by funds like JPMorgan Trust I, JP Morgan Exchange Traded Fund Trust, JP Morgan Mutual Fund Investment Trust and JP Morgan Insurance Trust.

A few US-listed Indian and India-focussed companies have also made similar observations in their filings during 2017. These include HDFC Bank, Cognizant, Cancer Genetics, WNS Holdings, Genpact and MoneyOnMobile Inc.

In the 'risk factors' listed in one of its regulatory filings, HDFC Bank said the risks to its financial results would include "instability or uncertainty in India and the other countries... caused by any factor including terrorist attacks in India, the US or elsewhere...".

The other risk factors listed by HDFC Bank include "tensions between India and Pakistan related to the Kashmir region or between India and China, military armament or social unrest in any part of India", among various other political and economic risks.

Political system stable in India, but religious conflicts remain overhang.

In its SEC filing, Eaton Vance Greater India Fund said Indian population is comprised of diverse religious and linguistic groups, but despite this diversity, India has "one of the more stable political systems among the world's developing nations".

"However, periodic sectarian conflict among India's religious and linguistic groups could adversely affect Indian businesses, temporarily halting work of institutions, or undermine or distract from government efforts to liberalise the Indian economy".

In its filing, Matthews International Funds also said that religious and border disputes persist in India and escalating tensions between India and Pakistan could impact the broader region.

MoneyMobile also talked abut the Kashmir dispute remaining unresolved and the potential risks to its businesses.

"Also, India has seen an increase in politically motivated insurgencies and a fairly active communist following. Any hostilities or civil unrest could adversely influence the Indian economy and, as a result, negatively affect businesses," it added.

Cancer Genetics said a portion of its assets and operations are in India and we are subject to regulatory, economic, political and other uncertainties in India.

The India Fund said India's economic development has exceeded forecast with faster growth than China's, but "heightened tensions with Pakistan over Kashmir, Trump's US presidential election victory and the Fed's increased hawkishness for 2017 also roiled investor sentiment".

IT major Cognizant, which has a substantial portion of its assets and operations in India, said in one of its SEC filings that the potential for hostilities between India and Pakistan "has been high in light of tensions related to recent terrorist incidents in India and the unsettled nature of the regional geopolitical environment, including events in and related to Afghanistan, Iraq and Syria".

Genpact said Southern Asia has, from time to time, experienced instances of civil unrest and hostilities among neighbouring countries, including India and Pakistan.

Alps Funds also talked about persisting religious and border disputes including on Kashmir issue and said these factors are extremely difficult, if not impossible, to predict and take into account with respect to the Fund's investments.

Franklin India Growth Fund said its investments are subject to "much greater risks of adverse events that occur in India and the surrounding regions, and may experience greater volatility than a fund that is more broadly diversified geographically".

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News Network
May 11,2024

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Out of jail and immediately hitting the campaign trail, Delhi Chief Minister Arvind Kejriwal on Saturday trained guns at Prime Minister Narendra Modi claiming that he will make way for Amit Shah next year when he turns 75 after sidelining all BJP leaders, including Yogi Adityanath, and jailing Opposition leaders.

Predicting that the BJP will be reduced to “220-230 seats” in the Lok Sabha polls, he claimed that Yogi Adityanath will be removed as Uttar Pradesh Chief Minister in two months if at all BJP returns to power to ensure Shah’s elevation as Prime Minister, as Modi himself has set the 75-year retirement rule in his party.

Accusing Modi of being dictatorial and seeking to implement ‘One Nation, One Leader’, Kejriwal insisted that the Prime Minister is not seeking votes for himself  and  people voting for BJP should know that they are not voting for Modi but Shah while wondering whether the latter would implement ‘Modi ki Guarantees’.

He also defended his decision not to resign as Chief Minister after his arrest, as it was a “trap” set by the Prime Minister to “finish off” AAP  and felt that JMM top leader Hemant Soren, who resigned as Jharkhand Chief Minister, also should not have quit his post.

Addressing a press conference that turned out to be a meeting of AAP supporters at the party headquarters here a day after he was released from Tihar jail on interim bail, he also asked Modi to “learn from Kejriwal on how to fight corruption”, as he referred to the induction of leaders who were accused of graft into the BJP. 

In his 20-minute address, which came after his visit to the Hanuman Temple in Connaught Place in the national capital, Kejriwal said Modi wants to crush his party as he knows that the AAP with its good work would replace the BJP.

If Modi does 'good work', no one will talk about AAP but people will not accept the attempts to decimate his party, which is working for the people, Kejriwal said.

“The Prime Minister says he fights against corruption but is inducting thieves and dacoits into his party. A leader who he described as one involved in a Rs 70,000 crore scam was inducted into the party ten days after Modi made the charges. If you want to fight corruption, learn from Kejriwal,” he said, citing instances of sacking and arrests of AAP ministers in Delhi and Punjab.

Warning that Opposition leaders like Mamata Banerjee, Tejashwi Yadav, NK Stalin and Uddhav Thackeray will be jailed by Narendra Modi if BJP wins, he said his arrest was meant to be a message to the country that if Kejriwal can be taken into custody, then anybody can be.

“People need to know, his mission's name is 'One Nation, One Leader'. To achieve this, there are two ways. One is to jail all Opposition leaders and the second is to sideline all leaders in BJP if they win. They have already sidelined L K Advani, Murli Manohar Joshi, Sumitra Mahajan, Shivraj Singh Chouhan who brought BJP back to power in Madhya Pradesh, Vasundhara Raje, ML Khattar…” Kejriwal said.

“Who is next in line? It is Yogi Adityanath. Take it in writing from me, if BJP wins, the UP Chief Minister will be changed in two months...He wants to crush democracy in this country. I am fighting against it," he said.

Referring to questions on who will be I.N.D.I.A. bloc's Prime Ministerial candidate, he said he has a counter question as Modi is turning 75 next September and he himself has set the retirement rule in the party.

“Now my question is who is BJP's Prime Ministerial candidate? If they can form the government, Yogi Adityanath will be first sidelined and then Amit Shah will be made the Prime Minister. Modiji is not seeking votes for him but for Amit Shah. Who will fulfil Modi's guarantees? Will Amit Shah fulfil it? I don't think they are going to form a government. But those who are going to vote for BJP should know that they are voting for Amit Shah,” he said.

Insisting that I.N.D.I.A. bloc will form the next government and that AAP will be part of it, Kejriwal promised full statehood for Delhi in such a dispensation. Emphasising that he did not resign when he was arrested because Modi had scripted it to finish off the party, he said he wanted to show that if democracy was jailed, it would run from jail.
 

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May 10,2024

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New Delhi: In a big blow to Brij Bhushan Sharan Singh, a Delhi court has ordered the framing of charges against the former Wrestling Federation of India chief in the sexual harassment allegations levelled by women wrestlers. The court has said there is sufficient evidence on record to do so, and the trial against him can now begin. 

Friday's order by the Rouse Avenue court comes days after the BJP decided not to repeat Mr Singh, who is the party MP from Uttar Pradesh's Kaiserganj, as the candidate from the constituency and decided to field his son Karan Bhushan Singh instead. 

The court has ordered the framing of charges under Indian Penal Code sections Ordered to frame charges against Brij Bhushan under sections 354 (outraging a woman's modesty), 354-A (sexual harassment) and 506 (criminal intimidation). The Delhi Police had filed a chargesheet against under these sections and one additional section - 354D (stalking) - on June 15 last year. 

Charges should also be framed against the former assistant secretary of the Federation, Vinod Tomar, under Section 506, the court said. 

Additional Chief Metropolitan Magistrate Priyanka Rajpoot said the charges will be framed against Mr Singh for sexually harassing five wrestlers and that he stands discharged in the allegations levelled by the sixth.

The six-time MP has been at the centre of a huge political storm since last year, when sexual harassment charges were levelled against him and protesters had hit the streets led by Olympic medallists Sakshee Malikkh and Bajrang Punia, as well as Commonwealth Games and Asian Games medallist Vinesh Phogat.

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May 8,2024

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Congress leader Sam Pitroda has stepped down from the post of Chairman of the Indian Overseas Congress and his resignation was accepted by the party. Congress leader Jairam Ramesh took to X and announced that Sam Pitroda had decided to resign from the key post "of his own accord".

Pitroda had been under fire over his controversial remark that Indians in the East resemble the Chinese while those in the South look like Africans.

"We could hold together a country as diverse as India -- where people on East look like Chinese, people on West look like Arab, people on North look like maybe White and people in South look like Africans. It doesn't matter. We are all brothers and sisters," Pitroda said during an interview with The Statesman.

The Congress immediately distanced itself from Pitroda's remarks, terming them "unacceptable".

"The analogies drawn by Mr Sam Pitroda in a podcast to illustrate India's diversity are most unfortunate and unacceptable. The Indian National Congress completely dissociates itself from these analogies," Jairam Ramesh said in a post on X.

The BJP also hit out at the Congress over Pitroda's remarks and termed them "racist and divisive".

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