|Asia News Digest
Moscow Asks India To Be 'Proactive' in Russia
Nov. 15 (EIRNS)During his ongoing visit to India, Sergei Sobyanin, Russia's Deputy Premier and co-chairman of the Inter-Governmental Commission on Trade, Economic, Scientific, Technological and Cultural Cooperation (IRIGC), told the Press Trust of India that "India's technological feat has opened up new avenues of cooperation with Russia, which is now poised for radical modernization." Sobyanin pointed out that, with China and the West seeking access to Russia's immense mineral and natural resources in its eastern part, Moscow wants "Indians to be proactive in capacity-building." Moscow wants India to invest in various economic sectors where it is traditionally strong; the goods produced in Russia, in turn, could fulfill India's import requirements.
Sobyanin spoke with Minister of External Affairs S.M. Krishna on a wide range of topics including nuclear deals, bilateral trade, and terrorism. This is a prelude to Prime Minister Manmohan Singh's Russia visit early next month. Prior to his visit to Moscow, Singh will be in Washington meeting President Obama in the last week of November.
In mid-October, India's state-owned Oil and Natural Gas Corporation (ONGC) indicated that it is considering purchase of oil and gas fields in the Tomsk region in Siberia's West. The ONGC is currently taking part in Sakhalin-I, an oil and gas project off the coast of Russia's Pacific island of the same name.
New Delhi Proposes Building Power Station in Iran
Nov. 19 (EIRNS)India may set up a 6,000-MW natural-gas-fired power plant in Iran, India's Power Secretary H.S. Brahma said. The plant is expected to cost about $6.2 billion. Energy-starved India, which imports 70% of the oil it consumes, has considered several options, such as natural gas pipelines from Iran and Turkmenistan via Pakistan, but the proposals have not made much headway because of tension between New Delhi and Islamabad. "There is a shortage of coal, shortage of gas in India. This [power plant] is viable," Brahma said. "A smaller power station would not be viable, as the power would be transmitted to India across a 1,000-km high-voltage transmission line," he added.
The plan to build the power plant, and bring in electricity to India through a transmission line, is part of a new proposed roadmap of cooperation between Iran and India. New Delhi has indicated that it is still interested in the Iran-Pakistan-India pipeline to bring gas from Iran to India.
Indonesia Will Build a Bridge from Java to Sumatra
Nov. 20 (EIRNS)Indonesia announced that it will commence building a bridge from Java to Sumatra, across the strategic Sunda Strait, by 2014. The $10 billion project will go into planning immediately. Unstated in the official releases is that Presidents Hu Jintao and Susilo Bambang Yudhoyono, in their meeting during the Nov. 12-15 APEC summit, reportedly discussed a Chinese role in the funding and construction of the bridge.
The 30-km bridge would be a huge boon for the underdeveloped island of Sumatra, home to 45 million Indonesians. If the north-south link of the Eurasian Land-Bridge were to be completed, another bridge would be needed across the Strait of Malacca, from Sumatra to Malaysia. Together with the Sunda Strait bridge, that would connect Jakarta to Kunming, China, and on to Europe, by rail. Unfortunately, there are as yet no plans to build the Malacca Strait bridge.
GM Pulls Another 'Opel'; This Time in South Korea
Nov. 19 (EIRNS)General Motors announced on Nov. 17 that it will begin manufacturing the GM Daewoo's Lacetti Premiere compact in the United States, starting in April next year.
The vehicle was developed and first manufactured by GM Daewoo, the Korean unit of the U.S. carmaker. Since its release in November 2008, GM Daewoo has rolled out 370,000 Lacetti Premieres, including 330,000 exported to Europe and China. It is one of the few successful GM models.
After being acquired by GM in 2002, GM Daewoo has not received any new investments from its parent, nor has it developed any new models, other than the Lacetti Premiere. Over the last few months, it has been working to cut its research and development staff by urging them to apply for early retirement. In "taking away the crown jewel of its Korean unit," the Korean paper Chosun Ilbo says, it directly brings up the German Opel case.
GM's Opel division was bailed out to the tune of EU4.5 billion by the German government, with the understanding that GM would then sell the unit so that German jobs could be preserved. GM, which is now majority-owned by the U.S. government, announced that it was reneging on the Opel deal on the same day that German Chancellor Angela Merkel was speaking before the U.S. Congress.
GM had attempted to coerce the South Korea government into a similar bailout of the GM Daewoo Division. However, the Korea Development Bank (KDB), which already owns a minority stake in GM Daewoo, insisted that the Korean enterprise retain its intellectual property rights in locally developed products and be guaranteed orders for five years. Corporate GM refused the conditions, and the KDB did not put up more funds.
One of the goals of President Obama's Nov. 18-19 visit to South Korea was to push the acceptance of the Korea-U.S. Free Trade Agreement negotiated during the George W. Bush years. Some Congressmen want to renegotiate the treaty so as to allow more "U.S. access to the Korean automobile market." Korean car makers have pushed to maintain the agreement as originally signed; GM's action certainly will not make them more amenable.
China Denounces U.S. Dollar Carry Trade
Nov. 15 (EIRNS)Liu Mingkang, chairman of the China Banking Regulatory Commission, described ultra-low U.S. interest rates as a "new systemic risk," immediately before President Obama's arrival in China.
"This situation has already encouraged a huge dollar carry trade and had a massive impact on global asset prices," he said in a speech at a financial forum in Beijing. "It is boosting speculative investment in stock and property markets and will pose new, insurmountable risks to the global recovery and, particularly, to the recovery in emerging markets."
This stance by China will present a serious problem to that faction in the U.S. delegation which desires to let the yuan appreciate; appreciating the yuan will "benefit U.S exports."