Indian Students and the Indian press

Australia's third largest export industry has grown by topsy because it has leveraged off the immigration quotas, not because it delivers a quality education experience. Even our best universities have had matching Govt. funding cut with every increase in full fee OS tutition payments. We have monetised the traditions of excellence of our institutions.

A whole sector has grown up that has milked and abused students with the knowledge that what they are really selling is permanent residency; so lets only go through the motions, because who the hell cares.

The Indian students, in turn, carrying laptops and mobiles to and from institutions, not by car, but on public transport have naturally become targets for opportunistic assaults and robberies that are motivated by nothing more than our undereducated and well neglected underclass seeking easy pickings.

No one has more respect than this writer for Indians and Indian civilisation, the nation that bought us zero, the Gupta Age, the Karma Sutra and Chola bronzes is worthy of respect but what does really annoy is the hysteria of the Indian press with its accusations of racism. The hyper-ventilated mega-murdockism of this fake manufactured outrage for profit is far more tawdry than that nest of white collar rorters and scammers who pose as "immigration agents" and "education providers".

Australian society has many flaws but it stands at the end of a unique pattern of development that drew on a thousand years of subtle social progress; development that created a civilisation that is characterised by the rule of law and little socialised violence, only some individual and gang pathology. Our violent impulses are formalised into "armed forces" and directed outward, for good or ill.

Compare that to the indian village where the constant competition for status under the caste system is nothing more than institutionlised and formalised communal violence, where the exploitation of religion by post independance politicians has killed millions and where the very armature of national politics is driven by the narrow interests of religion and class.

The Indian press needs a mirror and we need to rethink, in the light of the GFC, global warming and a much harder world why the economic benefits of a high level of immigration flow to a narrow group of private interests while the cost, both to our reputation and our public treasury are borne by Australians who would rather see due process, justice, compassion and public benefit drive our immigration schemes instead of these crude openings for endless opportunism, fraud and abuse of process.
We have left the field to rorters, gamers and ranters on every side, a trend that devalues the very currency of our polity and will, unless curbed, in the final analysis, destroy it.



Independent Senator Nick Xenophon has called for a statutory compensation scheme to reimburse overseas students who are ripped off by unscrupulous education providers.

He is also pushing for a dedicated ombudsman to investigate their complaints.

Senator Xenophon says his proposals have been prompted by last night's Four Corners program, which exposed widespread dodgy practices in the multibillion-dollar international education industry.

He says a compensation fund could be created, possibly through a small levy on educational services, to provide refunds to international students who are ripped off.

"Whether it's on fees or whether it's on the accredited bodies - that they have to pay a small levy - to ensure that if dodgy operators don't do the right thing, that students can be assured they'll be able to get a refund, that they won't be out of pocket, he said.

"Because that's obviously a key concern of overseas students and their families.

"It's also important to have an international students' ombudsman that can actually look at complaints and have some real teeth to investigate and to provide support to students," he added.

"They're clearly not getting that level of support now."

Senator Xenophon says decisive action needs to be taken to protect Australia's third biggest export industry.

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TRANSCRIPT
Transcript: Holy Cash Cows

Full transcript of Holy Cash Cows, broadcast on 27 July 2009.

Reporter: Wendy Carlisle

Date: 27/07/2009

STUDENT PROTESTERS: We want justice, we want justice

WENDY CARLISLE: In late May and early June, Australians were astonished to see thousands of Indian students protesting on the streets of Melbourne and Sydney. Their complaints - muggings and bashings and police indifference.

INDIAN MAN: He got beaten by three guys.

(Indian man demonstrating wounds)

INDIAN MAN 2: In front of all the policemen. And still they are assuring that they will give us security. What kind of security?

WENDY CARLISLE: Coverage in India bordered on hysterical.

(Excerpt of footage from Indian News)

INDIAN MAN 3: My parents are calling please every half hour. Please come back. If nothing is happening, come back.

INDIAN NEWS REPORTER: So what will it take for Mr Kevin Rudd to finally wake up?

KEVIN RUDD, PRIME MINISTER: Our Indian community has been such a vital contributor to our culture, to our life, to our food, to our music. My kids love Bollywood, you know, Bollywood is a thing with all of our kids, they just love it. So we actually have this deep affection for your country and for your culture and I always say this too, imagine if we never had Indian food in our Australia, we would be sentenced to 100 years of English cuisine.

(End of Excerpt)

WENDY CARLISLE: There's more at stake than being rescued from a century of bad British food. India is one of the main buyers of Australian education - after coal and iron ore, it's our third biggest export earner. But Australia's education exports face much deeper problems than safety issues, there's now a rising clamour over dodgy courses, student rip-offs and an education system that's turned into a visa factory.

PUSHPINDER KAUR, STUDENT'S MOTHER: It is a fraud, it is we were shown so many rosy pictures about the school, actually it is not what it was really, what it really is, it is only, it was just a scam.

WENDY CARLISLE: If there is one principle that governs the export of Australian education, it is now simply money.

BOB BIRRELL, MONASH UNIVERSITY: Well, basically they've been bedazzled by the dollars.

WENDY CARLISLE: On Four Corners tonight, the dirty secret behind Australia's other education revolution.

(On Screen Text: Holy Cash Cows, Reporter: Wendy Carlisle)

(On Screen Text: Crash Landing)

(On Screen Text: Hyderabad, India)

WENDY CARLISLE: Last year 75,000 Indian students came to Australia to buy an education, and the possibility of a new and more prosperous life.

(On Screen Text: 9 July 2009)

Pushpinder Kaur and her son - aspiring pilot Prabmeet Singh - are preparing to meet with a high level delegation of Australian bureaucrats, police and academics. For Prabmeet Singh studying in Australia was a deeply unhappy experience and there is much unfinished business.

(Excerpt of footage of Pushpinder Kaur and Prabmeet Singh driving in a car)

PRABMEET SINGH, STUDENT: Let's hope we can find some help this time.

PUSHPINDER KAUR, STUDENT'S MOTHER: You went to get wings but your wings are clipped actually.

(End of Excerpt)

WENDY CARLISLE: The highly publicised Australian delegation has been rushed to India. It's an exercise in damage control.

(Excerpt of footage from delegation meeting)

COLIN WALTERS, FEDERAL DEPARTMENT OF EDUCATION: The education system of Australia has no time for racism in any form and absolutely condemns attacks on students, attacks on Indians.

(End of Excerpt)

WENDY CARLISLE: But safety isn't what many of these parents have come to complain about. Pushpinder Kaur says a Sydney flying school has taken their money, left their family broke and her son with no pilots licence.

(Excerpt continued)

PUSHPINDER KAUR, STUDENT'S MOTHER: The first instalment we had to pay in advance that is for about $3,500, the total is about $43,000, and when the whole of the amount has been credited to the account of the aviation school there, which is known as Aerospace, and the chief flying instructor's name is Sue Davis and she has taken the whole of the amount and after that she has stopped imparting any training or given any training flying hours to the students there.

My son and one of the other students is here, right before this honourable delegation. And they have come back, and their careers are ruined and we have lost all that money which we have sent there.

COLIN WALTERS, FEDERAL DEPARTMENT OF EDUCATION: We will take the depositions back and we will have a look, we will talk to the authorities in New South Wales and we will also look at our own legislation and see if there is any further possibility of intervening in that case.

(End of Excerpt)

WENDY CARLISLE: Pushpinder Kaur has heard all this before.

(Excerpt continued)

PUSHPINDER KAUR, STUDENT'S MOTHER: I'd just like to advise the honourable Australian members that already we have taken this matter up with the state regulatory bodies like VETAB (Vocational Education and Training Accreditation Board) and DEEWR (Department of Education, Employment and Workplace relations), but nothing has been done so far.

COLIN WALTERS, FEDERAL DEPARTMENT OF EDUCATION: Righto. Well we'll certainly take that back with us and see if there is anymore we can do. Thank you very much.

PUSHPINDER KAUR, STUDENT'S MOTHER: Thank you.

(End of Excerpt)

PRABMEET SINGH, STUDENT: It feels really sad, really bad, because I had gone there to fulfil my dream to become a pilot. But you know all my dreams have been shattered.

WENDY CARLISLE: If Prabmeet Singh's dreams have been shattered, back in Australia his friend Surendra Egalapati is still trying to keep his dream of becoming a pilot alive.

SURENDRA EGALAPATI, STUDENT: I was very passionate about flying. I liked flying to fly, so I started this career in 07.

WENDY CARLISLE: Like Prabmeet Singh the school Surendra Egalapati chose was Aerospace Aviation run by Sue Davis.

SUE DAVIS, AEROSPACE AVIATION: We welcome having overseas students with us. They all bring delightful experience with them and we enjoy their time. May I add that our student of the year for the last two years has actually been a different Indian student.

WENDY CARLISLE: Surendra Egalapati is now at a different flying school. But within months of starting at Aerospace Aviation things started to go wrong.

SURENDRA EGALAPATI, STUDENT: I started complaining in the month of October. First I went to the Indian High commission, I complained there and they had a meeting with them and Sue Davis has assured that this is not going to repeat again. And the same thing, they have Indian high commission has told me that and after that the same thing is again repeating and repeating.

(Excerpt of footage of meeting between Indian students)

INDIAN STUDENT: All we guys are doing is refund what is not used from the college.

(End of Excerpt)

WENDY CARLISLE: Soon he discovered other students in the class of 2007 were having similar problems.

VISHAL SARAWAT, STUDENT: There were not enough planes not even, not enough instructors. I was like flying with around 21 instructors you know.

WENDY CARLISLE: Twenty-one instructors?

VISHAL SARAWAT, STUDENT: Instructors for this and like, it was like there was no responsibility in the school's part, like it was like I have to beg to instructors to give me flight, like "give me flight, I want to fly, I want to fly".

MUKESH PINDORIA, STUDENT: The rest of the time, well, go to school and you were told to sit under a tree with some plastic chairs around to hoping that someone does not show up and you get that flight.

WENDY CARLISLE: Sit under a tree?

MUKESH PINDORIA, STUDENT: Yes.

WENDY CARLISLE: Can you describe that for me? What was the scene?

MUKESH PINDORIA, STUDENT: Well, it's just under a tree. You don't have any other facilities. You're just standing, even if it rains, you have to be out there. I mean there is no any other facilities inside where you can accommodate all the students.

WENDY CARLISLE: So how many would there be of you sitting under the tree at any one time?

MUKESH PINDORIA, STUDENT: Any one time, you might find 20, 25 students sitting under a tree.

WENDY CARLISLE: Scott Alex is a former student at Aerospace Aviation. He also quit the school over not getting his flying hours and was disturbed by what he saw.

SCOTT ALEX, STUDENT: It was definitely derogatory the way they spoke to them, the way they treated them.

WENDY CARLISLE: Can you give me an example?

SCOTT ALEX, STUDENT: Instructors or management?

WENDY CARLISLE: Take your pick.

SCOTT ALEX, STUDENT: Um okay instructors hating flying with curry eating Indian stinking yellow so on, and management, I know of a case where the operations manager actually pushed around a student who was complaining, so they just basically raised their voice and in the Indian culture you don't raise your voice, it's very rude. You especially don't swear.

WENDY CARLISLE: The students had signed up for a commercial pilots' licence course. Costing $43,500, Aerospace Aviation was to deliver 200 hours of flying over 52 weeks. But in Surendra Egalapati's case, he only received 130 hours over an 18 month period. A story it seems, repeated throughout the school

KAPIL RAJ, STUDENT: In the matter of four or five months I could only get 17.9 hours of flying.

YASWANTH MUDUNURI, STUDENT: I got only 50.9 hours of flying.

ARUN KUMER, STUDENT: I did 46 hours in 16 months.

VISHAL SARAWAT, STUDENT: I will use the word wasted my time, 16 months being there, like achieving nothing over there.

SUE DAVIS, AEROSPACE AVIATION: Aviation requires a commitment. We provide the facilities, the aircraft, the highly qualified trainers, but it must be matched by the student's desire to reach a safety standard. I won't back down from that. I take that most seriously, as a delegate of CASA (Civil Aviation Safety Authority) that these students must meet the requirements.

We have provided everything that those students need to get through the course. The students need to provide the diligence, the dedication and the commitment.

WENDY CARLISLE: So are the students lying? Why would the students do this?

SUE DAVIS, AEROSPACE AVIATION: I think students when they're away from home perhaps don't meet up to their parents' expectations. As a mother myself, I understand when our children let us down. And it's a young man's issue that they have to now face up to the fact that they haven't provided the diligence that they require to get through the course.

(Excerpt of footage of reconstruction - students going to DEEWR headquarters)

WENDY CARLISLE: By October last year so many of Aerospace Aviation's students were complaining, that DEEWR - the Federal Department of Education, Employment and Workplace Relations - invited them down to their Sydney headquarters to hear their stories. Twenty-six Indian students turned up, as well as Scott Alex.

(End of Excerpt)

SCOTT ALEX, STUDENT: They said to me, we're too nervous, we want you to come with us. So I did. And when they asked what's happening, everybody was quiet. And then I said one thing, one point like "you have to pay $5,000 a month whether you fly or not, that's a bit wrong", and then everybody just started talking. So I just went there for moral support I guess you could say.

WENDY CARLISLE: And with the department, the officers, did they give any undertakings to actually fix the problems? What did they say that they were going to do?

SCOTT ALEX, STUDENT: Oh yeah, they were shocked, they were shocked and appalled with everything we said, yeah.

WENDY CARLISLE: But if the officials from DEEWR were shocked by what they were hearing - they were slow in reacting. The students felt their complaints had disappeared into a bureaucratic black hole.

SURENDRA EGALAPATI, STUDENT: I don't think so they're running an investigation. I do the, if they do an investigation it could take hardly two months or one month, not more than that. But it has been some six to seven months till now.

WENDY CARLISLE: And you've heard nothing?

SURENDRA EGALAPATI, STUDENT: And we, we didn't heard anything from them.

WENDY CARLISLE: After eight months of waiting for the Department's response they gave up and took a dramatic step to recover their money.

MUKESH PINDORIA, STUDENT: Well if someone would have listened to us we complained to the school first, and then we went to the Department of Education. We went to Department of Immigration too and Department of Education and Employment and Workplace Relations, but no one listened to us and now we have ended up here in the Supreme Court of New South Wales.

WENDY CARLISLE: Eight of the Class of 2007 filed a statutory demand notice on Aerospace Aviation calling for the refund of $157,000 or the company would be wound up. Last month it went to the New South Wales Supreme Court where the students were in for a nasty surprise.

(On Screen Graphic - Sue Davis' Affidavit)

WENDY CARLISLE: In her affidavit, Sue Davis included a five page report from DEEWR - which appears to be an investigation into the students who launched the legal action.

Surprisingly, this document didn't address the detail of the students' complaints nor did it examine their side of the argument, but nevertheless concluded "it would seem the students complaints have little or no foundation".

WENDY CARLISLE (to Sue Davis): I'm just trying to understand why DEEWR would only be investigating or making a finding on the students in this document which were the ones that appeared before the Supreme Court.

SUE DAVIS, AEROSPACE AVIATION: Well I'm sorry, you'd have to ask DEEWR that.

WENDY CARLISLE: Is it coincidence?

SUE DAVIS, AEROSPACE AVIATION: You'd have to ask DEEWR that. I can't answer for DEEWR.

WENDY CARLISLE: So how did this document end up before the Supreme Court? We asked the Department of Education to explain just why it conducted an apparently one sided investigation on behalf of Aerospace Aviation into the Indian students.

(On Screen Graphic - written statement from Department of Education)

WENDY CARLISLE: In a written statement, the Department told four corners "for privacy reasons it would be inappropriate to discuss individual cases".

The Department's conduct raises fundamental questions about the integrity of the Government's investigations into student's complaints. Four Corners requested an interview with Education Minister Julia Gillard but she declined.

KARL KONRAD, AUST. IMMIGRATION LAW SERVICES: It seems to me that the protection of the school and the business interests of the school overrides the protection of the student or the student's right to know, or any other Australian citizen's right to know as far as I can see.

WENDY CARLISLE: But you got the Deputy Prime Minister saying she is committed to ensuring quality in the education that we provide international students. Do you question that commitment?

KARL KONRAD, AUST. IMMIGRATION LAW SERVICES: I openly question that commitment because the quality of their investigations would have to be regarded with anybody, with any investigation experience as a joke.

WENDY CARLISLE: But for Surendra Egalapati, the greatest surprise was yet to come. In her affidavit, Sue Davis makes the claim that his plane had strayed out of the training zone and into Sydney controlled airspace on July 29, 2007.

WENDY CARLISLE (to Surendra Egalapati): It says on 29th of July that you penetrated Sydney airspace. Did you this?

SURENDRA EGALAPATI, STUDENT: I didn't do this. I started my flying from August 21st, 07. The proof is my log book. This is my logbook. And my first flight is August 21, here at 07. This is a false evidence, I don't know what evidence she is going to show, but I can, this is my proof.

WENDY CARLISLE (to Sue Davis): Did you swear a false affidavit in order to smear the character of Surendra?

SUE DAVIS, AEROSPACE AVIATION: I did not swear any false affidavits at all, the documentation was before the courts. Mr Surendra did not advise us that there were problems that he could see, we understand that the paperwork was correct.

WENDY CARLISLE: This is your document, that you have submitted before the Supreme Court.

SUE DAVIS, AEROSPACE AVIATION: That's correct.

WENDY CARLISLE: That you swear is true.

SUE DAVIS, AEROSPACE AVIATION: And Mr Surendra has a copy of that.

WENDY CARLISLE: Sue Davis has now told Four Corners she made an error in her affidavit.

Earlier this month the students' case against Aerospace Aviation was set aside here in the Supreme Court, the court found the students had pursued the wrong legal route against the flying school and ordered them to pay costs which could amount to tens of thousands of dollars.

And now, in what must seem a cruel twist to the students, the New South Wales Government has found that the flying school has been using unqualified flying instructors - an offence so serious it risks losing its registration.

VISHAL SARAWAT, STUDENT: Obviously I'm very angry. I've like taken a loan. It's a big loan and I paid the money to the school. I came here for a purpose, which is like I haven't got anything, I haven't got the my commercial pilot licence.

WENDY CARLISLE: The experiences of the Indian students at aerospace aviation are not an isolated example. Karl Konrad, a Sydney migration agent, has been trying to raise the issue.

KARL KONRAD, AUST. IMMIGRATION LAW SERVICES: I mean for years I've been writing about dodgy education providers in Sydney and nobody cares. I've even sent my newsletters about them to the Commonwealth Government and didn't, don't even get a response.

Nobody comes and asks me you know what's going on in Sydney because they don't really care, but certainly since the international students have come out, it's brought up yes their safety issues, but there's all these other issues which have been going on that nobody has cared about.

(On Screen Text: Cooking the Books)

WENDY CARLISLE: In the past most foreign students came to Australia, studied and took their degrees home. In 2005 that started to change. In an attempt to address Australia's skills shortage the Federal Government allowed students to undertake vocational courses and then stay in Australia.

Literally hundreds of private colleges have sprung up offering courses in hairdressing, cooking and accounting.

BOB BIRRELL, MONASH UNIVERSITY: Make no mistake, the driver for this explosion in vocational college enrolments of the past few years has been the carrot of permanent residence or getting into the Australian labour market.

(Excerpt from PR video - AIFE)

STUDENT: Studies which I'll be completing right now from AIFE is all based on managerial subjects now in advance diploma.

(End of Excerpt)

WENDY CARLISLE: This cooking school in Sydney's inner west is one of the fastest growing businesses in Australia. Four years ago Austech was turning over just $1 million a year - now it's turning over more than $30 million a year.

In 2008 Austech's enrolments had climbed to over 1,600 even though it was only registered for just 124 students. How this was allowed to occur is baffling. Four corners talked to one former employee of Austech - who on condition of anonymity agreed to tell us how the college kept signing up more students.

FORMER EMPLOYEE (actors voice): Management said keep enrolling, the Government won't close us down because where will the students go? It was a factory. We used to laugh in our office about VETAB and the Department of Immigration, how could they not have known what was happening? They were handing out all the student visas. I thought at the end of the day they had contacts in the right places in Canberra.

WENDY CARLISLE: Late last year the New South Wales Government finally ordered Austech to halt its enrolments. They said Austech didn't have enough kitchens and had effectively defaulted on providing the courses it was marketing.

For many of Austech students not having enough kitchens wouldn't be that much of a problem, many students have come simply to do the course and qualify for permanent residency.

But not so for Kumar Khatri from Nepal. He genuinely wanted to be a chef. After 6 months at Austech hadn't seen the inside of a kitchen, he wasn't even sure Austech had one.

KUMAR KHATRI, STUDENT: No, no I didn't believe that there is a kitchen for the college because I haven't seen the college kitchen.

WENDY CARLISLE: You never saw the kitchen?

KUMAR KHATRI, STUDENT: No, no I haven't seen it.

WENDY CARLISLE: You don't think the college had a kitchen?

KUMAR KHATRI, STUDENT: Yeah, I came to know that boys told, my friends that there is a kitchen for the college but I haven't seen, because they didn't take me. Not only me, my friends, along well, those Australians were studying with me didn't see the college kitchen.

WENDY CARLISLE: Kumar Khatri decided to call it quits. He notified the college - in accordance with the rules - and enrolled elsewhere. What came next was unexpected.

KUMAR KHATRI, STUDENT: I was happy and when I begin my college it was around a gap of three months and I got a letter from the professional debt collector.

WENDY CARLISLE: He was told to pay AUSTECH $5,000 or be taken to court.

KUMAR KHATRI, STUDENT: And I just went directly to the college and he told me it's clear if you're going to pay you pay. If you do not pay we will just process the file, we'll take it to the immigration, your visa will be cancelled, Kumar for your kindness, please pay the amount.

WENDY CARLISLE: Kumar Khatri was furious, he went to see migration agent Biwek Thapa who by then was also helping six other Nepalese students deal with Austech's debt collectors.

BIWEK THAPA, EDUCATION AND MIGRATION AGENT: I emailed back to the assistant CEO and his name is Umesh Banga, and I said "look I think we need to resolve this internally before it goes to media or before it goes to external appeal", which could be Ombudsman or Department of Fair Trading or ACPET (Australian Council for Private Education and Training) or could be anyone.

So before it gets further, let's be civilised and get this sorted and make it fair to the international students as well. Or tell us what you have to say if you think that they do owe you the money. No response. And a month later, I received a letter in the mail by post, from their lawyer saying Dear Mr Biwek Thapa, we're sorry that we took more than a month to actually get back to you. We have we have decided to withdraw the case.

WENDY CARLISLE: Why do you think the college hit these students with bills for $5,000?

BIWEK THAPA, EDUCATION AND MIGRATION AGENT: I think it was a complete exploitation of international students because of the ignorance, they're new in the country, they're not, they're not confident even to talk - communication problem - they're scared their visa could be cancelled, enrolment could be cancelled.

They would get into all sorts of problem. They don't have money to go to a court and fight the case. It's just a try, try to see if they can get money out of these people.

WENDY CARLISLE: Austech's assistant CEO Umesh Banga declined our offer of an interview to discuss these allegations. Four corners then discovered he'd been planning his own media offensive. He had tried - unsuccessfully - to enlist the support of a new students union, led by Navjot Singh.

WENDY CARLISLE (to Navjot Singh): So you went to Umesh Banga to ask him if you could get permission to go to his campus and recruit students for your organization, your student representative organization.

NAVJOT SINGH, ALL INTERNATIONAL STUDENTS ASSOC.: Yep.

WENDY CARLISLE: And what did he say to you. Ok come on?

NAVJOT SINGH, ALL INTERNATIONAL STUDENTS ASSOC.: I can't recall his exact word, but the words were effect to ah, I stop collecting $10 from students, I will give you the cheque but in return you need to go to ABC and he was showing that he's getting calls from Wendy Carlisle and I suppose that's your name. And he said I can set interview for you and you just need to go there and talk something good about Austech.

WENDY CARLISLE: And he offered you money to do that?

NAVJOT SINGH, ALL INTERNATIONAL STUDENTS ASSOC.: Yes.

WENDY CARLISLE: How much did he offer you?

NAVJOT SINGH, ALL INTERNATIONAL STUDENTS ASSOC.: Ah he did not put, put an amount but he said "whatever you want we will give you the money".

WENDY CARLISLE: A blank cheque?

NAVJOT SINGH, ALL INTERNATIONAL STUDENTS ASSOC.: Yeah.

WENDY CARLISLE: And why did you say no?

NAVJOT SINGH, ALL INTERNATIONAL STUDENTS ASSOC.: Because we are not for sale.

WENDY CARLISLE: Why did you decide to come forward to Four Corners and say this?

NAVJOT SINGH, ALL INTERNATIONAL STUDENTS ASSOC.: Because I feel that somebody need to come forward and expose what's happening out in private colleges.

WENDY CARLISLE: Umesh Banga denies this. He told Four Corners he'd never offered money to Navjot Singh.

(On Screen Text: Greasing the Wheels)

WENDY CARLISLE: The pitfalls for foreign students are many - not just dodgy colleges. To navigate the red tape of how to study and stay in Australia many students often turn to unscrupulous education and migration agents.

ARVIND SURI, MIGRANT: Yeah, at that time it was really good when I came in this country and I start studying, so things were going very good at that time.

(Excerpt of footage from wedding video of Arvind Suri and Priya Suri)

(End of Excerpt)

WENDY CARLISLE: Arvind Suri graduated with his MA in engineering management and decided he wanted to live in Australia in January 2007. His parents had arranged for him to marry Priya who had a Masters in microbiology. Between them they would have enough points to gain permanent residency, and start a new life together.

ARVIND SURI, MIGRANT: They said like, it's good like you are getting settled in your life. You are getting your permanent residency and after that you because you are masters you will get a good job and you will get settled in your life, and also you will get married, so your marriage status going to be good.

(Excerpt of footage of Arvind Suri and Wendy Carlisle watching wedding video)

ARVIND SURI, MIGRANT: My father in law is singing a song for blessings of the Lord, that everything is happening under the (inaudible) of the Lord. So, everything will go well.

(End of Excerpt)

WENDY CARLISLE: Arvind Suri sought the help of lawyer and migration agent Sam Tejani seen here at a recent community fundraiser. Acting on Sam Tejani's advice Arvind Suri brought his bride to Australia.

ARVIND SURI, MIGRANT: He said like it it's a very simple condition, you don't need to worry about that. You guys are married and immigration department wouldn't mind that a husband needs to stay with the wife. It's very obvious, they need to understand that so you don't worry about that.

WENDY CARLISLE: Three months after Priya's arrival in Sydney the couple discovered that Sam Tejani had bungled their permanent residency application. Priya had been included as a non-migrating spouse, and she had just two days to leave the country.

ARVIND SURI, MIGRANT: (Cries) She went back and I went straight to Mr Tejani and I said why you made a big mess in my application? He said it's not a mess, it's just like immigration department don't understand, but ah you will get your permanent residency in the same application, so.

WENDY CARLISLE: He was still promising it?

ARVIND SURI, MIGRANT: He was still promising me.

WENDY CARLISLE: Did you believe him?

ARVIND SURI, MIGRANT: I was such a big idiot, I was believing him.

WENDY CARLISLE: Finally Arvind Suri stopped believing and complained to MARA - the Migration Agents Registration Authority.

(On Screen Graphic: document from Migration Agents Registration Authority)

WENDY CARLISLE: The authority found that Tejani "had tried to mislead the Authority, was not a person of integrity, and was not a fit and proper person to provide immigration assistance". MARA found that Tejani would pose "a serious risk to future clients if he continues to practice" and on August 13, 2008 suspended him for 2 years.

Not able to gain work as an engineering manager because he hasn't got permanent residency, Arvind Suri now works in a Sydney supermarket. He has suicidal thoughts, and his wife Priya is still in India and she's threatening to divorce him.

ARVIND SURI, MIGRANT: There is going to be a blot on my career and my fate forever that I spoiled my wife's visa and I used her physically and emotionally and sent her back to India.

(On Screen Text: reconstruction)

To add insult to injury, in January Arvind discovered that even though Sam Tejani was banned from working as a migration agent, he was still plying his wares. Arvind Suri emailed MARA to let them know.

Arvind Suri wrote, "I saw him distributing his business card to students on town hall square. It feels to me it's against the law and order of Australia". But before the regulator would investigate they asked Arvind to provide further information such as how he knew Sam Tejani was receiving cash payments.

Four Corners discovered that Sam Tejani is trading as a sole solicitor even though he is not licensed to do so. He's also holding himself out to be a migration agent, despite being banned for two years. These aren't the only areas where Sam Tejani is skirting the law. He's also helping students to cheat the English language test, one of the pillars of the education and immigration system.

To expose this practice Four Corners recruited a young Indian reporter to go undercover - she found Sam Tejani was willing to provide her with a number of options to pass the test. One of them was that someone else would sit the test for her.

UNDERCOVER REPORTER: Somebody smarter and who could obviously get a better score than I can, would go into the test and the examiners would keep quiet about it. Or that the examiners would switch the answer papers. I would go in but they'd switch the answer papers with the right answers and they could do that because they were friends of his and that he does people favours and then they return the favours.

WENDY CARLISLE: How much did he say that this would cost you?

UNDER COVER REPORTER: He was very reluctant to name the exact price and I kept pushing and he said three, four, maximum $5,000. If I did not go through him and if I tried to in the open market, he says it costs about $20,000, but because he knows these people it'll cost about five.

WENDY CARLISLE (On phone to Sam Tejani): Mr Tejani hi, its Wendy Carlisle here from the Four Corners program.

WENDY CARLISLE: Four Corners asked Mr Tejani for an interview but he refused, in a written response he denied the allegation and says he never offered to sell the English language test to anyone. Mr Tejani has now removed the registered migration agent and solicitors sign from his office.

(On Screen Text: The Work Experience Scam)

WENDY CARLISLE: For any students wanting to remain in Australia they must prove that they have done 900 hours of work experience in their chosen trade. Like the English language test, there is evidence of a flourishing black market in these certificates.

KARL KONRAD, AUST. IMMIGRATION LAW SERVICES: There's no doubt that the fake experience certificates or the letters that they need to pass the skill assessment process is very widespread and we brought this to the attention to the Immigration Department years ago, but it wasn't really acted on.

WENDY CARLISLE: Well how did you bring it to their attention?

KARL KONRAD, AUST. IMMIGRATION LAW SERVICES: We sent an email. I had many students come to my officers and say "oh I can buy letters for $3,000 at particular restaurants". They didn't name the restaurants, but the fact that I was getting many of these type of stories that we sent that information to the Immigration Department and they in turn thanked us for the information and said they would pass it on to Trade Recognition Australia. Nothing ever became of that and I didn't see any increase in the screening of those type of documentation.

WENDY CARLISLE: For the agents working in this area there is a reluctance to discuss this. Sanjay Deshwal is a leading migration agent in Sydney.

WENDY CARLISLE (to Sanjay Deshwal): Well how widespread do you think a racket is in work experience certificates?

SANJAY DESHWAL, EDUCATION AND MIGRATION AGENT: I wouldn't have a clue because clients come to us, and if a client brings to us the document we are not doing an investigative job. As a migration agent if you come to me for example from overseas or from a college over here, I have got no jurisdiction to check the authenticity of the documents.

You come to me and say okay this is my qualification from overseas, this is my qualification from Australia, this is my work experience letter, I have to lodge on the good faith. It's up to the assessing bodies and up to the Department of Immigration to investigate and monitor them.

WENDY CARLISLE: So you don't think it's a widespread scam that's operating?

SANJAY DESHWAL, EDUCATION AND MIGRATION AGENT: No, no. I won't go into that much like detail like. There are obviously like, when such a big market and such a what do you call, opportunism is there, then a lot of people will try to cash on on the bandwagon.

WENDY CARLISLE: Several students told Four Corners that in student circles, Sanjay Deshwal is known as the go-to man for fake documents. We sent our undercover reporter in to test these claims. He told her he could arrange for a work experience certificate from a restaurant.

WENDY CARLISLE (to undercover reporter): Did he say how much these work experience certificates would cost you?

UNDERCOVER REPORTER: Three to $4,000.

WENDY CARLISLE: He was in effect offering to broker this deal for you was he?

UNDERCOVER REPORTER: Yes, yes.

WENDY CARLISLE: Did you make it clear to Sanjay Deshwal that you didn't want to work for these work experience certificates?

UNDERCOVER REPORTER: Yes, yes, yes, I did tell him that I know people that wanted me to work for free to get that certificate, but I did not want to actually work. I had the money and I just needed the certificate and he said I wouldn't have to work for a single second inside that kitchen.

WENDY CARLISLE (On phone to Sanjay Deshwal): Mr Deshwal hi, it's Wendy Carlisle here from Four Corners. I'm very well, thank you.

WENDY CARLISLE: Mr Deshwal initially agreed to an interview but by the time Four Corners arrived at his office he'd changed his mind. The interview was off and he strongly denied the allegations.

While the Government has been happy to boast about Australia's education industry, hard questions must now be asked.

(Excerpt of footage from Australian delegation meeting in India)

PARENT: We have already taken loans.

AUSTRALIAN EDUCATION DELEGATE: I understand, I understand

(End of Excerpt)

WENDY CARLISLE: Why have the scams, dodgy colleges and corrupt practices been allowed to flourish on its watch?

BOB BIRRELL, MONASH UNIVERSITY: Well, basically they've been bedazzled by the dollars. As the, as the figured mounted in billions, every year and, and they could proudly say that this is a $15 billion industry, more than wheat, wool, and meat put together, there's, there's perhaps an understandable reluctance to look critically at the foundation of the industry.

MUKESH PINDORIA, STUDENT: Australia is not a good place to go because people even complaining about the schools and the Governments is doing nothing about it.

PUSHPINDER KAUR, STUDENT'S MOTHER: I think the Government should be more alert in these type of matters because it is, it is the career of the children which is at stake.

(Excerpt of footage from Australian Delegation meeting in India)


COLIN WALTERS, FEDERAL DEPARTMENT OF EDUCATION: So unfortunately we need to wrap it up now, we've got another meeting to go to. I am afraid we need to wrap it up now. If you've got any other questions perhaps I'll...

INDIAN AUDIENCE MEMBER: What is the basic reason...

COLIN WALTERS, FEDERAL DEPARTMENT OF EDUCATION: I am sorry Sir, but we'll now wrap it up and if you've got any more questions perhaps you can catch members of the delegation on the way out. Thank you very much indeed everyone.

WENDY CARLISLE: The Government needs to clean up the rot and restore confidence in our education industry. The consequences of not doing so will be dire. Our 3rd biggest export earner could be a $15 billion bubble about to burst, and Australia's reputation irreparably damaged.

http://www.abc.net.au/4corners/content/2009/s2637255.htm

BRIC and SCO Summits ~Reinventing the Wheel

A new world is being born, one without the US dollar greasing the wheels of commerce, notes Eric Walberg
Yekaterinburg, famous tragically as the spot Lenin chose to have the Tsar and his family executed in 1918, and ironically as the fiefdom of Boris Yeltsin, who finished off the Russian revolution itself in 1991, witnessed something no less remarkable last week when leaders of the so-called BRIC nations (Brazil, Russia, India and China) held their first summit, following the yearly meeting of the Shanghai Cooperation Organisation (SCO). The BRIC countries comprise 15 per cent of the world economy, 40 per cent of global currency reserves and half the world’s population. Brazil , India and China have also weathered the financial crisis better than the world as a whole.
Holding the two meetings together meant that Indian Prime Minister Manmohan Singh attended the SCO for the first time. The SCO, Russian and China ’s Eurasian security organization, has become a key counterweight to US hegemony in the world, and Russia and China are eager to have India upgrade its position of observer to member. This summit appeared to have coaxed India a step closer, as the SCO security agenda has shifted its emphasis to the growing security threat from Afghanistan, which satisfies the more pro-US India .
But the headline-stealer was the BRIC summit. While the US plays its tiresome geopolitical games on Russia ’s eastern borders, Russian President Dmitri Medvedev was busy charting a new economic and political reality in the heart of Eurasia . “The artificially maintained unipolar system”, he lectured, is based on “one big centre of consumption, financed by a growing deficit and ... one formerly strong reserve currency.” At the root of the global financial crisis, he concluded, is that the US makes too little and spends too much. Especially upsetting for Russia is its continued military largesse to Georgia , the missile shield in Eastern Europe and its invasions of Iraq and Afghanistan . “The summit must create the conditions for a fairer world order,” he read out, as Presidents Hu Jintao of China , Luiz Inacio Lula da Silva of Brazil and the Indian prime minister looked on approvingly.
China backs Russia ’s two big gripes with the US : “The security of some states cannot be ensured at the expense of others, including the expansion of military-political alliances or the creation of global or regional missile defense systems,” the joint Chinese-Russian statement says. Chinese leader Hu Jintao also joined Medvedev in denouncing US plans to militarise outer space: “Russia and China advocate peaceful uses of outer space and oppose the prospect of it being turned into a new area for deploying weapons ... The sides will actively facilitate practical work on a draft treaty on the prevention of the deployment of weapons in outer space, and of the use of force or threats to use force against space facilities.”
Iranian President Ahmedinejad, fresh from trouncing his pro-Western rival in presidential elections, dotted the “i”s at the SCO meeting, taking a leaf from Venezuela ’s Hugo Chavez: “The international capitalist order is retreating. It is absolutely obvious that the age of empires has ended and its revival will not take place.”
But there was more than colourful rhetoric in all this, despite the pooh-poohing of Western pundits, who deride the SCO and BRIC as a collection of misfits and wannabes. The BRICs have put the US dollar on notice, and are already finding alternatives as a means of clearing accounts. Medvedev called for the IMF to include the Russian ruble and the Chinese yuan in the basket of currencies used to value its financial products. But that is just for starters. Chinese Central Bank governor Zhou Xiaochuan says the goal is now to create a reserve currency “that is disconnected from individual nations.”
Even more ominous for the threadbare dollar, though perfectly sensible in the computer age, is the revival of stone-age barter on a big scale, which bypasses the need for any reserve currency at all. Brazil ’s biggest trading partner, once the US , is now (surprise) China , and they are using barter deals to settler their accounts, bypassing the dollar altogether. Two weeks ago China reached an agreement with Malaysia to denominate trade between the two countries in yuan.
As dollars are the world’s default reserve currency today, the US government can churn them out at will to paper over its massive foreign debt and budget deficit, effectively letting it steal other countries assets legally and forcing countries everywhere to finance its military spending. China , Russia , Brazil and now India are well aware of this, have had enough, and have the international heft to do something about it. For them, the US is the ultimate rogue nation. How else to characterise a country that insists other countries follow one set of laws – on war, debt repayment and treatment of prisoners – but ignores them itself? The US is now the world’s largest debtor yet has curiously avoided the pain of “structural adjustments” that the IMF imposes on other debtor economies, refusing to cut its bloated military budget or increase taxes meaningfully. “The world economy should not remain entangled, so directly and unnecessarily, in the vicissitudes of a single great world power,” said Roberto Mangabeira Unger, Brazil’s minister for strategic affairs.
The US can never “repay” the $4 trillion debt it owes foreign governments, their central banks and the wealth funds set up precisely to dispose of the global dollar glut. “ America has become a deadbeat – and indeed, a militarily aggressive one,” notes Michael Hudson. The problem is how to contain it. Rumblings are coming not only from fringe peaceniks. Yu Yongding, a former Chinese central bank advisor now with China ’s Academy of Sciences, advises US Treasury Secretary Tim Geithner that the US should save by cutting back on its military spending. “ US tax revenue is not likely to increase in the short term because of low economic growth, inflexible expenditures and the cost of ‘fighting two wars’”.
The BRICs are trying to organise their affairs so that they are no longer the unwilling recipients of dollars. No matter what they think of the US , they hasten to insist they don’t want to see the US dollar collapse, since they hold most of their own reserves in dollars. But they are beginning to withdraw the life-support system the US has been relying on since Nixon completed the transition from a gold-based reserve currency to a purely paper one in 1971.
Just to emphasise how serious the situation is, according to the Financial Times, the top 5 financial institutions by market capitalisation in 1999 were, in order, Citigroup (US), Bank of America (US), HSBC (UK), Lloyds TSB (UK), Fannie Mae (US). The top 5 as of 2009 are Industrial & Commercial Bank of China, China Construction Bank, Bank of China, HSBC (UK), and JPMorgan Chase (US). From 0:3 to 3:1 for China, now officially the world’s second largest economy after the US – a rout.
Just as countries are beginning to rediscover age-old barter, fixed, pegged and dual exchange rates are also being considered, mechanisms once derided as passe. In the face of continued US overspending, de-dollarisation will force countries to return to nationally determined fixed exchange rates and dual exchange rates – one exchange rate for commodity trade, another for capital movements and investments.
The world is discarding its sixty-year old framework, though the historic meetings in Yekaterinburg elicited only a collective yawn from most media. “Between the BRIC countries, there is really little in common,” said Yevgeni Yasin, head of research at the Higher School of Economics in Moscow. “Each of them has its own destiny, its own special character, and it will be much more difficult for them to agree among themselves than separately with Western countries.” China depends on manufactured exports to the US and Europe. Russia sells oil, natural gas and other natural resources. Brazil relies on agricultural exports, while India ’s growth has been largely based on its domestic market.
However, Jeng Fengin at the Chinese Institute of Modern-Day International Relations is less blase: “The financial crisis has given a much-needed boost to the fledgling partnership between Brazil, Russia, India and China and helped our voice to be heard everywhere.” President of the Brazil-Russia Chamber of Commerce, Industry and Tourism Gilberto Ramos warned sceptics that the BRIC countries are all powers of a truly continental scope and have very much in common, both geographically and macroeconomically.
In case Obama hasn’t noticed, Eurasia is coalescing, not around littler Georgia and big brother Poland, with their pretensions as forward bases for the mighty US empire, but around China, Russia and India. He would do well to remember Yekaterinburg is not only famous for its Russian past, but for Gary Powers, the US spy shot down in 1960, a fitting metaphor for how Russia and China are taking aim at the US-dominated international financial order.
***
Eric Walberg writes for Al-Ahram Weekly. You can reach him at

http://ericwalberg.com/

The Ages of Gold ~ The story of India watch now

Episode Four is the story of India in the Middle Ages. At the time of the fall of the Roman Empire in the West, and the European Dark Ages, India had a series of great flowerings of culture, both in the north and the south. In this episode Michael Wood shows us some of the amazing achievements of medieval India: In astronomy they discovered the heliocentric universe, zero and the circumference of the earth.

They mastered the world's first large scale wrought iron technology—the Delhi iron pillar, and their courtly culture was the setting the world's first sex manual, the Kama Sutra.

Meanwhile in the south the rising power of the Cholan empire spread Indian arms and culture to the Maldives, Sri Lanka, the Andamans, and to Java and the Malay peninsula, where the Tamil diaspora is still powerful today.

Wood visits the Cholan capital at Tanjore, and with extraordinarily privileged access takes us right inside the greatest temple of that time (founded in 1010), to see the ancient rituals still being performed.


Cholan temple, Tanjore

In a fascinating sequence we see traditional bronze casters, making religious images for the temples, just as their ancestors did 1500 years ago.

We visit a traditional Tamil family in the temple city of Chidambaram, go with them on pilgrimage and witness the ancient mountain top festival of fire that was already famous in 700AD!

The story ends in Multan in Pakistan in the early eleventh century with a shadow on the horizon—the first invasions by Turks and Afghans bearing the Muslim faith that will change the story of India and turn the subcontinent into the biggest Muslim civilization in the world.

Watch it now free for the next 48 hours

After and Overseas

here...

India and China want IMF to sell its $100b gold

India and China may press for the sale of the entire gold reserves of the International Monetary Fund (IMF) to raise money for the least developed countries.

The IMF holds 103.4 million ounces (3,217 tonnes) of gold that, if sold, can fetch about $100 billion.

A draft paper exchanged between New Delhi and Beijing proposes that the gold be sold in bullion markets over a period of two to three years. The money thus raised must be used in tackling poverty in the poorest nations.

“We have been discussing with China a common position on the subject,” a senior finance ministry official told Financial Chronicle.
Both prime minister Manmohan Singh and Chinese president Hu Jintao will have to clear the proposal before the representatives of the two countries can take it up at the IMF spring meeting in June in Washington.
The G20 heads of state meeting in London earlier this month agreed to sell a part of the IMF gold to raise $6 billion for poor countries during 2009-11. This was a component of a $1.1 trillion package worked out by G20.
The World Bank has estimated that over 90 million people may be pushed into poverty in the global economic turmoil.
“We are working on a more ambitious proposal of selling the entire gold as it is an idle asset with the IMF,” said the official.
India and China are looking at three ways of using the money so raised. 1) The $100 billion be invested to improve IMF’s liquidity. 2) The money be committed to improving incomes of the poorest countries. 3) A mix of the first two options be considered.

How the sale will affect the bullion market, with attendant problems for currencies, has not been assessed. A large part of the gold may find its way into central banks and private players. Since most of its will be out of reach for retail markets, gold prices may not get hammered.

Globally gold prices now are in the $870 - $950 per ounce range. India and Turkey, traditionally big buyers of gold, have not bought much lately because of low domestic demand. During January to March, India bought a paltry 1.2 tonnes. (Normally, India imports about 700 tonnes a year.) Turkey bought just 40 kg last month.

K Shivram, vice- president of the World Gold Council, said, “Whether the gold will be sold or not is an open question.” If the sale did take place it would be staggered, he said. There could be a temporary correction in gold prices but the market would bounce back.

He added that when G20 announced the limited sale of gold, the prices that had been ruling around $950, dropped to $875. “But they are again moving up.”

In India, gold now quotes at Rs 14,500 to 15,000 per 10 gm. Karvy Comtrade, a commodity brokerage, expected the price to drift to Rs 13,000 by the end of June. He did see an impact of IMF gold sales in the short- to- medium term.

Vibhu Ratandhara, assistant vice- president of Bonanza Commodity, said much depended on the US, which had 17 per cent equity in gold at the IMF.

The gold, if cold, would go mostly to central banks. He said there could be some impact on retail prices which might drop by Rs 400 per 10 gm.

The IMF has built its gold reserves over 40 years. The historical value of the gold, as declared in its balance sheet, is $9.3 billion. Four major sources helped build the reserves. One, member- countries paid in gold their 25 per cent initial quota subscriptions. Two, interest charges on credit given by it were collected in gold from many countries. Three, member-countries can sell gold to it to fight a temporary liquidity crisis. And four, they can make loan repayments in gold.

http://www.mydigitalfc.com/news/india-and-china-want-imf-sell-its-100b-gold-897

Coxe still long commodities ~ Boston Globe

Donald Coxe, 73 years old and unbowed, offers no apologies for getting it wrong on commodities in 2008. Instead, by way of explaining why he’ll be proved right in the end, he offers an amazing story about Margaret Thatcher.

The tale takes place more than 30 years ago. Through pure chance, Coxe, then an obscure pension fund manager, found himself at a private dinner with Thatcher, then still the untested leader of the Opposition British Conservative party, at the home of E.P. Taylor, the legendary business tycoon.

At one point, Coxe wound up next to the woman who was about to become the first female Prime Minister of the United Kingdom. She was forecasting the future. And he was entranced. Thatcher told him she would win the next election (which she did the following year, 1979). She also told him that in 1980, Ronald Reagan would become the next U.S. president.

The two would attack the scourge of inflation with tough interest-rate policies, and both she and Reagan would survive the resulting recessions to win re-election. Thatcher, as Coxe tells the story, then predicted that by the late 1980s, “‘We’ll have defeated inflation, we’ll have the West respecting itself and believing in free markets again.’ And then she smiled and she looked at me and said, ‘Mr. Coxe, perhaps also by then we’ll have won the Cold War.’”

It’s apparent by the enthusiasm with which he tells it that Coxe never tires of this anecdote. He is, after all, one of the few prominent Bay Street figures whose love for the markets is matched by a passion for history and politics, especially conservative politics. But as he speaks on this early winter day from his office on LaSalle Street in Chicago, Coxe is not merely reminiscing. He also has a serious point. Well, two.

The first is to let the listener know that he has been around for a long time, and seen more than a little bit of history— financial and otherwise. This is not some 36-year-old economics graduate who was still a university student when the early 1990s recession hit. Coxe doesn’t hesitate to remind people that he entered the world of Bay Street in 1972, and thus has lived through the horrific bear market of 1973 and 1974—an event that had him convinced, by the dawn of 1975, that “I’d probably come into the wrong business.”

But his second point is about the importance of leaders and leadership in tough times. Thatcher had a plan, and it pulled Britain out of stagnation, inflation and economic decline. Reagan’s policies had a similar effect in the United States. Deng Xiaoping, who placed China on the road to a market economy, changed the world. So did Manmohan Singh, the current Prime Minister of India and the Finance Minister in 1991, who used a financial crisis to shake that country out of its decades-long embrace of socialism. “I’m not a believer in the idea that we’re caught up in forces beyond our control,” says Coxe. The right policies, combined with political will, matter. “So once I’m satisfied that we’ve got the smart people in there who are prepared to do whatever is necessary to prevent a collapse, I assume it will be done.”

All of which serves to explain why Coxe—who in December left his post as Bank of Montreal’s global portfolio strategist, to start Coxe Advisors LLC— believes that history will vindicate him and prove that his difficult 2008 was an aberration. While Coxe wasn’t shocked to see a market meltdown last fall, he was caught badly off guard by the way the concomitant financial crisis destroyed prices for the commodities and commodity stocks that he has for years touted as the fastest way for investors to increase their wealth. Oil, after peaking at just short of $150 (U.S.) a barrel in July, fell to $45 (U.S.) by year-end. Corn, from a summertime high of roughly $8 a bushel, plunged to $4; copper went from about $4 a pound, to $1.40.

Few resource companies were spared, except for gold stocks. The shares of many junior mining companies lost most of their value. In the oil patch, even a blue chip like Suncor Energy Inc., a Coxe favourite, was down 56% in 2008. As for Coxe himself, he called the recession correctly, but stumbled on how to play it. “Stay overinvested in commodity stocks whose earnings and performance are tied to stronger economies in the Third World,” he advised his readers in one of his “Basic Points” reports. The date was July 3, 2008. As it turned out, that was the best time not to buy commodities, but to sell them. The Reuters/ Jeffries CRB commodity price index peaked on July 2. Over the next six months, it plummeted by half.

Worse still, the market now had a simple way to track his mistakes. The $300-million Coxe Commodity Strategy Fund, after debuting to a warm reception from investors in June, was down 55% by mid- October. For Coxe, there’s little escaping responsibility; even the ticker symbol, COX.un, makes it clear who is driving the fund.

The turning point was July 13, the Sunday that the U.S. government made its first steps toward what would soon become the nationalization of Freddie Mac and Fannie Mae, two giant mortgage guarantors in the U.S. That event, a precursor to the bankruptcy of Lehman Brothers Holdings two months later, moved the credit crisis to a new phase. Commodities began to sell off viciously. Coxe says that at one point during the downdraft, he had lost $2 million, or 40% of his personal equity portfolio. “From July 14 until, I would say, roughly last week, has been the most stressful [period] of my recent working life,” he said in an interview shortly before Christmas. “You’re talking to me at a time when I’m feeling somewhat beaten up.”

So he’s bruised. But wrong? Coxe doesn’t think the word applies. “When the market seems to have gone to hell, you say, ‘Well, aren’t you realizing in the middle of the night that you were all wrong?’ No!” He believes in the impact of strong leaders, and therefore believes the world—because of the efforts of Barack Obama, Ben Bernanke and the leaders of China and India and Europe, among others—will avoid spiralling into a 1930s-style depression. Not only will their policies breathe new life into the economy, Coxe predicts, they’ll do it so quickly that Bernanke, the chairman of the U.S. Federal Reserve, will be worried about inflation by the end of this year.

Forget about the gloomy headlines: “I’m more and more of the view that we’re going to find out that the surprise will be how strong we come out on the other side of this,” he says. “It won’t be long before inflationary pressures will show up. And, of course, they will show up first in the commodities.” It’s a forecast fit for an optimist, and one that few economists share in the winter of 2009.

The question is, after last year’s debacle, how many other investors will buy the sunny outlook Coxe is selling?

At his stage in life, Coxe has little need to worry about his reputation. He insists that he left BMO on his own terms, and indeed, he’s signed a deal to continue writing research and doing conference calls for investment advisers at BMO Nesbitt Burns, the bank’s retail brokerage. He remains one of Canada’s mostwatched market gurus. One rough year is not going to cause his loyal followers to stray. “For my money, he’s the best in Canada,” says Seymour Schulich, the billionaire investor and philanthropist. “Some of these guys, you look at and you think they’re from Mars.... You know what I like about him is, he’s got a real grasp of financial history.”

Besides, as Schulich points out, plenty of smart people failed to foresee how awful 2008 would turn out to be. Jeffrey Rubin, the highly regarded economist from CIBC World Markets, originally forecast the S&P/TSX composite would rise to 16,200 on the back of constantly rising oil and metal prices (it ended at 8,987). The mutual funds managed by Eric Sprott and his team at Sprott Asset Management, arguably the best resource investors in the country, were ravaged, and the firm’s stock fell as much as 77% below the price of its initial public offering in May.

But if Coxe was hardly the sole exponent of commodity bullishness in Canada, he is one of the most persistent, and certainly the most articulate. His speeches and writing are unlike that of any other investment strategist in the country. How many analysts would dare use a word like “rhadamanthine”

(meaning “rigorously just”) in their reports? A typical Coxe missive is like a random walk through his fertile mind: history, politics, finance, science, investment theory. He is not afraid to use metaphor, humour or even poetry to make his sharp and often-cutting observations. Coxe has noted on more than one occasion that the Nasdaq Stock Market’s headquarters in Times Square are on the site of a former porn shop, and “there is some question as to whether the ethical standards of that corner improved.”

His unique style is a byproduct of his atypical path to the Street. He never went to business school. After graduating from high school in Newmarket, Ontario, he studied English, Latin and history at the University of Toronto, and later went into law. This led, oddly enough, to journalism and the National Review, the organ of American conservatism (the connections from which led, later on, to the dinner with Thatcher).

The intellectual challenge of journalism fit Coxe; the financial rewards, not so much. “It was a fabulous job to have, but we couldn’t raise a family in New York on $9,000 a year.” Coxe chose to return to Toronto with his family, where he pursued a legal career but without much enthusiasm. In the early 1970s, he landed at Mutual Life, writing speeches, among other duties. Before long, however, he had worked his way into its investment unit, and became known for dispensing his views in a colourful manner. During the inflation-wracked 1970s, he’d tell clients that the right amount of time to hold longterm bonds was “the amount of time you hold a hand grenade after you’ve pulled the pin.” He joined Nesbitt Thomson, which later became BMO Nesbitt Burns, in 1992.

The historian in him never faded, and neither did the writer. When he wasn’t penning his lengthy strategy reports (which he says he will still be writing bimonthly), he was pronouncing his views to a wider audience in The Globe and Mail, the National Post, Maclean’s and elsewhere.

Like all strategists, Coxe got some predictions badly wrong. His bullish calls on gold in the early and mid-1990s were duds. For a time, he was an alarmist about the Y2K problem, writing: “Wouldn’t it be fascinating if the once-in-a-millennium crisis came because creditors were unready for Y2K?” Other predictions he got dead-right. He warned at the end of 1997 that the Asian crisis was far from over, which it wasn’t. He raised a skeptical eye at the absurd valuations on many technology companies in 1999 and 2000, and was right.

But it was his early, prescient call on commodities that cemented his reputation. Coxe says he turned bullish immediately after 9/11. He was pulling together a book titled The New Reality of Wall Street. The technology story was over; the media and telecom bubble had burst. In the late 1990s, America was coming down from the zenith of its economic power. Where would the action be? Coxe had noticed something about the world’s two most populous countries, China and India. Changing times and, in India, changing governments had not budged either nation’s commitment to joining the modern economic world. “This,” says Coxe with typical flourish, “will be the greatest simultaneous efflorescence of personal economic liberty in human history.”

What on earth does that mean? “I define that as people who move into dwellings with indoor plumbing, electricity, basic appliances, and [who] acquire personal motorized transportation. If you’ve got those things, you’ve got more personal freedom than 99% of the people who’ve ever lived.” In other words, Coxe foresaw that the urbanization and accelerating industrialization of China and India would lift tens of millions to a better standard of living, which would increase their consumption on a massive scale.

More cars mean more oil and steel; new houses and apartments require copper and steel and cement; office buildings and factories use tonnes of metals of all types. In 2001, China’s rapid growth was a known fact, but not yet widely discussed or debated in the North American press or on Wall Street. Thus it met one of the most important rules of Coxeism: “You should not invest in a story that’s on page 1. Invest in the one that’s on page 16 on its way to page 1.”

By the middle of the decade, oil and mining bulls were as easy to find as believers in the so-called Chindia thesis. But Coxe took it further, calling for a huge spike in the value of grains and other food. Coxe’s prediction of a farm boom offers insight into how his brain works. It was a conclusion he arrived at not by examining spreadsheets but through a mixture of personal observation and science. Coxe’s father was born in a mission in India, and in early 2006, Coxe went back to retrace his ancestral roots. “I spent my time in the villages,” he recalls, “and from that, I got the sense of the real revolution that was going on in India.” Coxe saw first-hand that as poor Indians became more prosperous, they spent their extra income on, among other things, a better diet. “I came back and I said, ‘The big commodity story now is going to be food and agriculture.’ ” By early 2008, with prices for most basic foodstuffs up sharply,

the words “food crisis” had moved their way from page 16 to page 1. And even though all of those commodities subsequently dropped, he is every bit as convinced he is still correct, because of the latest data on sunspots.

Yes, sunspots. A few words of explanation are required at this point. Coxe believes that theories of man-made global warming are, to be polite about it, a crock. The climate’s natural swings are much greater than we think, and on this point, the man can cite trivia almost endlessly. (Coxe, a long-time friend says, has an eternal fascination with weather patterns.) “At the time of the Norman conquest in Britain [around 1066], the Vikings were growing grapes in Greenland,” he says. Later, the Earth went through an extended cool period, so that by the late 1700s, “it’s recorded that people went from Manhattan to Staten Island on horse and carriage” across the winter ice. Coxe believes the data show sunspot activity is responsible for these changes. And since sunspot activity has recently been lower than expected, Coxe thinks it’s possible we’ll soon be fretting about global cooling. Buy Monsanto. Buy other agriculture stocks. If you have the stomach to play the futures market, buy grain futures. “We’re going to have probably the worst food crisis on record,” Coxe says.

It is a fascinating theory—one that goes against the conventional thinking in scientific and political circles. But then, Coxe is full of fascinating theories. He is surely the only stock market guru in North America who can speak with authority about Galileo’s early records of solar activity, or Mount Pinatubo’s effect on the global temperature. One Canadian portfolio manager says that Coxe is a terrific lunch or dinner companion, a gentleman, and a skilled raconteur. This person loves meeting with Coxe whenever the two are in the same city.

But, adds the manager, “He drove people off a cliff here.” There’s no doubt: Investors who followed Coxe’s advice made a lot of money for five or six years, but gave much of it back in the latter half of 2008. How did he fumble it? “What you had was the sharpest sustained drop in commodities in history, and we didn’t have a global depression,” says Coxe. Coxe says he underestimated the role of the hedge funds. He knew that many of them had gone long on commodities and short on financial stocks—that was rather obvious, and amplified the sharp rise in commodity prices in 2007 and the first half of 2008. What he didn’t realize, or fully appreciate, was how many billions of dollars of those bets were made on borrowed money. Since commodities futures themselves are a leveraged investment, the result was a series of bets in which leverage was piled on top of leverage. The whole edifice came tumbling down during the summer, as hedge fund losses began to pile up and the margin calls came pouring in.

“None of us, or nobody I talked to, thought that much of it was hedge funds that were leveraged 30 or 40 or 50 to 1,” says Coxe. Does he wish he’d figured it out? “You bet. But I don’t know how I could have gotten that information.” As for how the slide began, Coxe has become something of a conspiracy theorist. He believes that the Fed, with some help, engineered the commodity correction to try to bring hedge funds to their knees, forcing them to cover their short positions in financial shares and thus driving those shares up to the point where banks could raise new capital that they desperately needed. “Although it wiped out 40% of my net worth temporarily, I believe they did the right thing. In order to save the banking system, they had to kill the commodities.”

The theory has a nice ring to it, and there may even be some truth to it, and yet it also seems a bit too convenient. (And if the point was to help the banks, it didn’t work so well, judging by the seismic upheaval in the global banking system in September and October.)

The focus on the machinations of traders and fund managers glosses over another truth: Coxe and other oil bulls failed to foresee how quickly things would change on the ground. Take oil: At the start of last year, the International Energy Agency forecast that oil demand would grow by a brisk two million barrels a day. By December, the IEA said 2008 would be the first year since 1983 in which demand fell. Meanwhile, copper is piling up in warehouses at a level not seen in years.

“I don’t know how you could miss that,” says Paul Gardner, a portfolio manager at Avenue Investment Management in Toronto. He’s a long-time Coxe fan, but is nonetheless perplexed by what he sees as a gap in logic exhibited by Coxe and such others as Eric Sprott: If you’re bearish on the economy, how could you think that commodities will just keep going up? “You have to lose some of your shine because of that,” says Gardner. “You’re putting all your chips on China and India, and do you really trust the numbers there?” What Coxe trusts is his own eyes. He recently got back from another trip to India—in fact, he stayed at Mumbai’s famous Taj Mahal Hotel, and departed just five days before terrorists attacked it in India’s version of 9/11. While in the city, he visited Mumbai’s central train station, to people-watch. “They look so much healthier than they did a few years ago,” he says.

“I cannot give you qualitative data. I look at the people’s bodies.” He is as convinced as ever that China and India will be the world’s great economic powers by the middle of this century, that the standard of living of their people will grow, and that the next great investment is food. “I haven’t lost my enthusiasm for the belief that if there’s a world tomorrow, it’s going to be a world that needs more commodities, and that this still is the overarching theme of our time...the opportunities for investors are going to be really marvellous.”

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India, China can't compensate for lost US spending

By ERIKA KINETZ
AP Business Writer

They were supposed to keep the good times going: Prakash Shetty, caught recently thumbing through "Singh is King" DVDs at a mall in India, and Zhu Xiaolin, who enjoys cute Adidas sportswear and Body Shop cosmetics in China.

But how far can Shetty and Zhu, both 26, and other Asian consumers go to save the groaning global economy? Just how many Buicks, Barbie dolls, Wrangler jeans, waffle fries, kiwi lip balms and plastic thingamajigs are they willing or able to buy?

Not enough, it turns out.

Much has been made of the power and promise of Indian and Chinese consumers. Each country has a rapidly growing economy, rising incomes and more than a billion people — many of whom have yet to burn through a single credit card or experience the joys a washing machine can bring.

China will be the world's third-largest consumer market by 2025 and India will be No. 5, ahead of Germany, McKinsey & Co has predicted. As U.S. sales swooned this year, emerging markets were the sole bright spot on many balance sheets.

But such heraldry obscures a painful bit of math: U.S. consumers still buy more than five times as much as Indian and Chinese shoppers combined. And despite rambunctious growth, revenues from India and China have barely softened the blow of declining sales in the developed world — even for companies that have chased after rupees and yuan most aggressively.

From Adidas to General Motors Corp., companies that have plunged into India and China are finding that these markets are, by and large, still too small to make up for the slowdown in the U.S. and other rich countries. Moreover, India and China are not immune to the global crunch. Declining exports, particularly in China, and tight credit have cooled spending growth, despite the favorable long-term trends.

Chinese consumer spending is projected to reach $1.3 trillion this year, according to Euromonitor International, a market research firm. That would approach France's $1.4 trillion but pales in comparison to America's $9.9 trillion. Indian consumers will spend $660 billion, or about half of China's.

In October, Americans spent $102.8 billion less than they did in September. That one month drop is nearly two and a half times more than Indian consumer spending is expected to grow this entire year.

"In dollar terms they can't offset," said Arvind K. Singhal, chairman of Technopak Advisors Pvt. Ltd., a retail consulting firm based in New Delhi.

It's not that Indian and Chinese shoppers aren't eager. Take Shetty. Trim and gregarious, he just got promoted to assistant manager at the Leela Kempinski, a luxury hotel in Mumbai where rooms were going recently for $280 a night. After he got the news, he handed his mom a fistful of cash, bought a television set, two cell phones (one for his dad), a stack of DVDs, a $700 gold necklace for his fiance and a couple of new outfits for himself.

"You feel great when you buy new clothes," he said, fending off a small crowd at the DVD rack of Big Bazaar, a popular discount shop.

His appetite for shopping helps explain why growing markets such as India and China "may make up for some of the stagnation you have in more mature markets," said Jan Runau, a spokesman for Adidas Group AG. By the end of this year, China is expected to surpass Japan as the second largest market for Adidas worldwide, after the U.S.

But, Runau cautioned that once other countries entered the recession, India and China would be affected: "They can't make up for everything."

Dell Inc., the world's second largest PC maker, saw revenues grow 48 percent in India and 18 percent in China in the third quarter, but global sales still fell 3 percent to $15.2 billion.

The two markets contribute about 5 percent of the company's revenues, while the U.S. accounts for half.

"It's starting to have a meaningful impact on Dell's results, but it's not enough to offset what's going on in the United States," said Steve Felice, president of Dell Asia Pacific and Japan.

GM's North American revenues fell $4.1 billion in the third quarter to $22.5 billion; the drop alone was almost as much as its total Asian sales of $4.8 billion. Add in the $1.3 billion slide in European sales, which totaled $7.5 billion, and it is clear that Asia can't save the company, teetering as it awaits federal assistance.

"We need to turn around our North American business. There is no choice," GM President Fritz Henderson said in September, at the opening of a new factory in Pune, a growing Indian manufacturing hub outside Mumbai.

For Vodafone Group Plc, the world's biggest mobile phone service provider by sales, India and China are "absolutely vital," said company spokesman Simon Gordon. "That's where the growth is."

But over 70 percent of Vodafone's sales still come from Europe. In the first half of this fiscal year, India accounted for just 6 percent of the group's 19.9 billion pound in revenues and less than 1 percent of adjusted operating profits. Vodafone does not operate in China, though it owns a 3.21 percent stake in China Mobile.

During that period, the company posted a 35 percent fall in net profit, despite adding 10.5 million new customers in India and growing India revenues by 41 percent.

Now, the economies of India and China are themselves slowing. Their stock markets have plunged, businesses and households are finding it harder to access credit, and fears of job losses have shaken consumer confidence.

Lower export growth in China is spilling over into consumer spending, as workers fret about pay and job security.

Zhu, who works at an export company in Shanghai, has been trolling the Internet for shopping deals, because she is not getting a bonus this year.

"Companies that can't manage to sell their export items are selling online at very low prices," she said. "It doesn't mean I don't like shopping in stores, but I can't afford that right now."

Despite government efforts to spur domestic spending, many Chinese remain frugal, concerned about saving for health care and retirement.

"Consumer demand is not going to be the answer to disappearing exports," said Robert Lawrence Kuhn, chairman of Kuhn Global Capital LLC and a longtime adviser to the Chinese government. "China's domestic consumption is necessary but not sufficient to stabilize China, much less the world."

India relies less on exports. They account for about 20 percent of the Indian economy, versus 35 percent in China.

Still, the global financial crisis has hit the Indian stock market and sparked a nasty credit crunch. Many consumers are unable to get loan approvals or afford the high interest rates. That, plus lingering inflation, has hurt consumer confidence and crimped growth.

Gibson Vedamani, chief executive of the Retailers Association of India, says overall retail sales in India will likely grow 8 to 10 percent this year, down from about 30 percent last year.

Sales of basic items such as food and clothes, which account for most Indian spending, have held up far better than credit-driven purchases, such as homes and cars.

"We are not seeing a slowdown on basic products," said Kishore Biyani, chief executive of the Future Group, India's largest retailer, whose holdings include discounter Big Bazaar. He's still hiring and plans to expand total floor space from 11 million to 16 million square feet by June next year.

Most Indians won't set foot in Biyani's sweeping 16 million square feet for years, however. The masses still struggle, parceling out their rupees at the hot, hectic mom-and-pop shops that dominate the landscape.

"We won't buy from the mall," said Suraj Buralkar, 21, who dropped out of school and started driving a taxi to help support his parents and three siblings. "The mall is too expensive for us."

Still, Buralkar, like many in this hopeful country, is on his way. Earning just 3,200 rupees ($67) a month and working overtime to satisfy his gnawing desire for stuff, he saved enough to pluck a pair of jeans, at 1,300-rupees ($27), or one-third of his monthly income, from one of India's teeming roadside bazaars.

___

AP Business Writer Elaine Kurtenbach contributed to this report from Shanghai and AP Researcher Monika Mathur from New York.


In this Nov. 18, 2008, file photo, women enjoy their ice cream at a mall in Bangalore, India. From Adidas to General Motors, companies that have plunged into India and China are finding that these markets are, by and large, still too small to make up for the slowdown in the U.S. and other rich countries. Moreover, India and China are not immune to the global crunch. Declining exports, particularly in China, and tight credit have cooled spending growth, despite the favorable long-term trends. (AP Photo/Aijaz Rahi, file)


A woman shops at a mall in Mumbai, India. From Adidas to General Motors, companies that have plunged into India and China are finding that these markets are, by and large, still too small to make up for the slowdown in the U.S. and other rich countries. Moreover, India and China are not immune to the global crunch. Declining exports, particularly in China, and tight credit have cooled spending growth, despite the favorable long-term trends. (AP Photo/Rajanish Kakade)


In this Nov. 19, 2008, file photo, a man looks at a washing machine at a shopping mall in Mumbai, India. From Adidas to General Motors, companies that have plunged into India and China are finding that these markets are, by and large, still too small to make up for the slowdown in the U.S. and other rich countries. Moreover, India and China are not immune to the global crunch. Declining exports, particularly in China, and tight credit have cooled spending growth, despite the favorable long-term trends. (AP Photo/Rajanish Kakade)


An attendant waits for customers in a department store in Beijing, Friday, Nov. 14, 2008. Much has been made of the power and promise of Indian and Chinese consumers, but companies are finding that these markets are, by and large, still too small to make up for the slowdown in the U.S. and other rich countries. Declining exports, particularly in China, and tight credit have cooled spending growth, despite the favorable long-term trends. (AP Photo/Greg Baker)


Chinese women walk through a quiet Beijing shopping mall Monday, Nov. 17, 2008. Much has been made of the power and promise of Indian and Chinese consumers, but companies are finding that these markets are, by and large, still too small to make up for the slowdown in the U.S. and other rich countries. Declining exports, particularly in China, and tight credit have cooled spending growth, despite the favorable long-term trends. (AP Photo/Greg Baker)


ADVANCE FOR DEC. 22; graphic shows total consumer expenditure for selected countries; 2 c x 3 5/8 in; 96.3 mm x 92.075 mm
ap

Gold makes glittering comeback

MUMBAI: Gold is enjoying a modern-day renaissance in the country. From retail sales of 300-400 kgs of gold bar per day at the start of 2008, demand has surged to 3,000 to 4,000 kgs per day.

Barring the slight rise in price at the start of this week, most counters registered an unprecedented sale. Gold's dip below Rs 12,000 per 10 grams early this month has sparked off widespread buying. From a high of Rs 13,900 for 10 grams around a month and half ago, the price of the yellow metal slipped to Rs 11,850 on Wednesday, ensuring droves of customers.

The demand for the metal has skyrocketed to such an extent that imports for the month of August alone are set to cross 100 tonne. Last August, the country imported 69 tonne of gold.

"Ten days ago, the price was Rs 11,300 and retail outlets recorded consumer demand many times higher than that witnessed during 'Dhanteras', the first day of Diwali, or 'Akshaya Tritiya', when buying gold is considered auspicious," said Suresh Hundia of the Bombay Bullion Association.

India, the world's biggest buyer of bullion, is also set to increase its gold imports for the first time in nearly 12 months, analysts told TOI. Given that the first half of 2008 saw volatile gold prices driving down demand, the last few weeks have witnessed a sudden rush of imports.

The country imported 750 tonne of the yellow metal in 2006. This dropped to 449 tonne in 2007, as a consequence of the rise in price. Traders who spoke to TOI said India imported 122 tonne between January to July 2008. The corresponding period of 2007 saw 269 tonne of the metal coming into the country.

Incidentally, the rise in demand is being attributed by traders to the next festival after 'Raksha Bandhan', which is Ganesh Chaturthi, which falls on September 3. Traders maintain that many consumers, particularly in South India, normally buy idols or jewellery in gold to bedeck their favourite God and the rush to retail stores ensures that the line-up to the festival has already started.

Gold generally moves in tandem with crude oil as the latter signals inflation. The fall in price in the international market has ensured a slump back home.

Gold makes glittering comeback

MUMBAI: Gold is enjoying a modern-day renaissance in the country. From retail sales of 300-400 kgs of gold bar per day at the start of 2008, demand has surged to 3,000 to 4,000 kgs per day.

Barring the slight rise in price at the start of this week, most counters registered an unprecedented sale. Gold's dip below Rs 12,000 per 10 grams early this month has sparked off widespread buying. From a high of Rs 13,900 for 10 grams around a month and half ago, the price of the yellow metal slipped to Rs 11,850 on Wednesday, ensuring droves of customers.

The demand for the metal has skyrocketed to such an extent that imports for the month of August alone are set to cross 100 tonne. Last August, the country imported 69 tonne of gold.

"Ten days ago, the price was Rs 11,300 and retail outlets recorded consumer demand many times higher than that witnessed during 'Dhanteras', the first day of Diwali, or 'Akshaya Tritiya', when buying gold is considered auspicious," said Suresh Hundia of the Bombay Bullion Association.

India, the world's biggest buyer of bullion, is also set to increase its gold imports for the first time in nearly 12 months, analysts told TOI. Given that the first half of 2008 saw volatile gold prices driving down demand, the last few weeks have witnessed a sudden rush of imports.

The country imported 750 tonne of the yellow metal in 2006. This dropped to 449 tonne in 2007, as a consequence of the rise in price. Traders who spoke to TOI said India imported 122 tonne between January to July 2008. The corresponding period of 2007 saw 269 tonne of the metal coming into the country.

Incidentally, the rise in demand is being attributed by traders to the next festival after 'Raksha Bandhan', which is Ganesh Chaturthi, which falls on September 3. Traders maintain that many consumers, particularly in South India, normally buy idols or jewellery in gold to bedeck their favourite God and the rush to retail stores ensures that the line-up to the festival has already started.

Gold generally moves in tandem with crude oil as the latter signals inflation. The fall in price in the international market has ensured a slump back home.

Gold makes glittering comeback

MUMBAI: Gold is enjoying a modern-day renaissance in the country. From retail sales of 300-400 kgs of gold bar per day at the start of 2008, demand has surged to 3,000 to 4,000 kgs per day.

Barring the slight rise in price at the start of this week, most counters registered an unprecedented sale. Gold's dip below Rs 12,000 per 10 grams early this month has sparked off widespread buying. From a high of Rs 13,900 for 10 grams around a month and half ago, the price of the yellow metal slipped to Rs 11,850 on Wednesday, ensuring droves of customers.

The demand for the metal has skyrocketed to such an extent that imports for the month of August alone are set to cross 100 tonne. Last August, the country imported 69 tonne of gold.

"Ten days ago, the price was Rs 11,300 and retail outlets recorded consumer demand many times higher than that witnessed during 'Dhanteras', the first day of Diwali, or 'Akshaya Tritiya', when buying gold is considered auspicious," said Suresh Hundia of the Bombay Bullion Association.

India, the world's biggest buyer of bullion, is also set to increase its gold imports for the first time in nearly 12 months, analysts told TOI. Given that the first half of 2008 saw volatile gold prices driving down demand, the last few weeks have witnessed a sudden rush of imports.

The country imported 750 tonne of the yellow metal in 2006. This dropped to 449 tonne in 2007, as a consequence of the rise in price. Traders who spoke to TOI said India imported 122 tonne between January to July 2008. The corresponding period of 2007 saw 269 tonne of the metal coming into the country.

Incidentally, the rise in demand is being attributed by traders to the next festival after 'Raksha Bandhan', which is Ganesh Chaturthi, which falls on September 3. Traders maintain that many consumers, particularly in South India, normally buy idols or jewellery in gold to bedeck their favourite God and the rush to retail stores ensures that the line-up to the festival has already started.

Gold generally moves in tandem with crude oil as the latter signals inflation. The fall in price in the international market has ensured a slump back home.