Tuesday, October 5, 2010

Plea for Withdrawal of Turnover Tax

Addressing a press conference in Karachi, Chairman, All Pakistan Consumer Products Distributors Association (Apcpda), Tahir Khaliq demanded withdrawal of one percent turnover tax imposed in federal budget 2010-11 on distribution of consumer products and medicine. As he put it, although the turnover of distributors is immense their margin of profit is very nominal and they are unable to pay this tax. According to his argument, distribution work would come to an end in the event of the government declines to withdraw the turnover tax, saying distributors were operating on fixed margin of profit or commission, ranging from 1.5 percent to 6 percent, and on the terms and conditions of manufacturers. However elaborating on the role of distributors, he noted that they purchase the goods at high prices from manufacturers, store the in warehouses, and then supply them shop to shop by vans, thereby, costing them a lot of money, which is met from the commission they earn.
From all available indications, the Apcpda, will appear to have built its case on the fast moving consumer goods (FMCG) which goes, generally speaking, to the advantage of the manufacturers of branded goods, and not to government from the insignificant tax on its distribution. As for the financial gains accruing from the entire business cycle, there can be no two opinions on the identity of the brand owners. More to this, the brand image, which has been defined as a symbolic construct created in the minds of people and comprising all the relevant information around the given product or service. This is why those engaged in branding are usually after associating the expectations behind the brand experience, thereby, striving to establish that the given branded product or service possesses qualities or characteristics that adds to its value in one way or the other. This is one single aspect which is emphasized the most in brand’s advertising at huge costs. Needless to point out, it does demonstrate what the brand owner is in a position to offer to the consumers. It goes without saying that brands should be taken as more than the difference between the actual cost of a product and its selling price. Moreover, his assertion that the distributors earn 1.5 percent to 6 percent on their total turnover, should allow them enough margin of profit, from the approach of economies of scale. His plea that the supply of goods and medicines would come to a standstill in the event of distributors close down their businesses, will also leave a great deal to be desired. Of course, Apcpda chief’s observation the association would contact the finance minister, members of national assembly and the senate to apprise them of the impact of turnover tax on distribution of consumer products should appeal to reason.

SCO summit begins; discusses regional stability and security

The annual 10th summit of the Shanghai
Cooperation Organization (SCO) began here Friday with a focus on
regional stability and security and to pursue development in the
The summit is being attended by heads of state from China,
Russia, Kazakhstan, Tajikistan and Uzbekistan, the delegate from
Kyrgyzstan, and leaders and delegates from SCO observer nations --
Mongolia, India, Pakistan and Iran.
President Asif Ali Zardari is representing Pakistan at the
Uzbek President Islam Karimov in his opening speech stressed
the need for strengthening political and economic cooperation and
stepping up anti-terrorism efforts to secure peace and stability
among the SCO countries.
Two agreements between the SCO states are to be signed today -
One between the SCO governments to enhance cooperation in the field
of agriculture, and the second for cooperation in combating crime.
The leaders will also approve a joint statement at the end of
the summit. The draft documents submitted for approval at the summit
include the regulations on procedure for admitting new members, and
the SCO procedure rules, aimed at further enhancing efficiency and
improving the internal mechanisms of the organization.
The SCO states will also approve the SCO Secretary General's
Report on its performance, while another resolution will deal with
performance of counter terrorism Regional Centre and review its
performance to consolidate collective anti-terrorism cooperation
within SCO states.
The theme of the summit is "to strengthen unity and
cooperation, maintain stability and pursue common development in the
The leaders and participants exchanged views on the world and
regional situation, and will coordinate strategies for combating
terrorism, separatism and extremism.
They will also focus on need to expand inter-member economic
cooperation and set up an SCO admission mechanism.

Pak-China to celebrate 60th anniversary of their diplomatic ties next year

Pakistan-China will celebrate 60th anniversary of their diplomatic ties next year to reinforce their ever-green strategic partnership.
This was stated by Federal Minister Arbab Muhammad Zahir, while addressing a farewell reception held here last night in honour of outgoing Chinese ambassador to Pakistan, Luo Zhaohui, that was largely attended by a number of federal ministers, senior officials, political figures, journalists and the elite of the city.
Huang Xilian Deputy Chief of Mission of the Chinese Embassy highlighted the personal efforts made by ambassador Luo during his about four-year tenure in strengthening Sino-Pak bilateral ties.
While paying glowing tributes to the outgoing ambassador, he said his contribution will go a long way in bringing their bilateral ties to a new height.
The Minister said, Pakistan considers friendship with China the bedrock of its foreign policy. "Our diplomatic relations which were established in 1951, have since then, grown from strength to strength. Sino-Pak all-weather friendship is based on complete trust, mutual understanding and convergence of views on all issues.
This sentiment resounds in the psyche of our people and is passing on from generation to generation."
Our relationship, he added has evolved into a long-term strategic partnership aimed at promoting peace and stability in the region and they in Pakistan rejoice over the great achievements of the Chinese people which attest to the genius, wisdom and talents of the Chinese people and their sagacious leadership.
Pakistan and China are good friends, good brothers and good neighbours and this is reflected in their professional and personal relationship with the Chinese Embassy, he added.
Arbab Zahir further said ambassador Luo Zhaohui has contributed tremendously in his capacity as Chinese Ambassador to Pakistan in enhancing and strengthening the relationship between the two countries.
"Many projects have been initiated and successfully completed during his stay in Pakistan. Chinese investment in Pakistan has increased in recent years. We wish him best of luck and good fortune in his future assignments and have full confidence that he will continue to work for Pak-China Friendship in whatever capacity he can, " he added.
The Minister reaffirmed the commitment of the government and the people of Pakistan to continue investing in the Sino- Pak relations.
In his brief remarks, Ambassador Luo said he went through a unique diplomatic experience during his stay in Pakistan that embodied with spirit of love and affection.
He said he was looking forward to act as Pakistan's ambassador in Beijing on return home. He termed his farewell meetings with President Asif Ali Zardari and Prime Minister Yousaf Raza Gilani as highly encouraging for playing more pro-active role in deepening their bilateral ties on all levels.

Saturday, October 2, 2010

Keeping it all in the family

Khalaf Al Habtoor, the founder and chairman of the Al Habtoor empire, had a well delineated succession plan in place for the family business to make a smooth transition into its second generation and ready to face up to the challenges thrown up by increasing competition and unforeseen economic forces in a rapidly globa lising world.
By making a clear separation between ownership and management, Khalaf put in place structures and rules that allocated rights and responsibilities among the children who stayed with him to continue the family business.
It is uncommon in the region to have succession plans in place before it is too late and conflicts emerge, fracturing familial relationships. Managing succession is a major challenge for the region’s private businesses, more so in the aftermath of the recent global slowdown, which is forcing changes upon them, according to the experts.
“Family businesses don’t survive that long for some inherent structural issues,” says, Mohammad Al Habtoor, son of Al Habtoor Group founder and chairman Khalaf Al Habtoor. “There is a general perception that as family size increases, the pie sometimes does not grow commensurately and different members have different views and objectives.”
He acknowledges the difficulty of keeping a family business alive beyond the second and third generations, but that can’t be a rule, he says.
Khalaf Al Habtoor, the patriarch, says he is less anxious when it comes to his family.
“Thank God my children are on the right track, and I taught them how to manage their business. But still you can’t see yourself in this modern generation and guarantee anything,” he says. “However, with prudent business planning this can be mitigated,” he adds.
Khalaf, 60, is worried how the new generations will take over the family business and stand amid the strong competition and challenges in the market, keeping the business as strong and efficient as it is now.
After working for three years with his father, the eldest, Rashid Al Habtoor, branched out on his own in 1993 to set up Al Habtoor Trading Enterprises. Today he runs his own diversified business in the Middle East and former states of the Soviet Union.
Mohammad and Ahmad, both educated in the US, and Amna, one of his three daughters, manage different segments of the group. Mohammad, 41, is CEO of the Al Habtoor Group, which is one of the biggest diversified business consortiums in the UAE — dominant in construction, hospitality and care sales — with interests in the UAE and UK. Ahmad, 32, is the chief of Habtoor Motors. Amna, who has a degree in law, looks after the education sector. But all three have had to earn it.

Foreign investors shifting focus away from emerging markets

With the US dollar strengthening due to the eurozone turbulence, the rupee is losing ground and foreign institutional investors (FIIs) are shifting their focus from emerging markets like India.
Analysts feel that the European debt crisis, which brought the euro to its lowest level in four years, coupled with a weak rupee, is leading to the FIIs cutting down their exposure in India. They are investing more in corporate and government bonds and gold in developed economies.
During the April-May period, the rupee has weakened by 3.5 per cent against the US dollar, while it had strengthened by 6.42 per cent against the euro in the same period.
“The Indian rupee continued its depreciation journey in the past fortnight as ongoing economic worries in the euro zone led to concern of another round of recession.

Obama demands more cash from BP over oil spill

President Obama will demand that BP provides more money to handle the Gulf of Mexico oil crisis and sets up a substantial fund to meet claims when he meets the company's senior executives for the first time later this week.
He wants BP to hand over the funds to an independent administrator to supervise the distribution to meet "legitimate" claims and speed up compensation payments to people and companies in southern US states who have either lost their jobs or business.
The president stepped up the pressure in advance of today's meeting of the BP board where directors will discuss whether to bow to earlier US demands to freeze dividend payments to its 314,000 shareholders. Transocean, operators of the Deepwater Horizon rig which caused the disaster after an explosion that cost the lives of 11 men, is pushing ahead with a $1bn (£687m) dividend payout to its shareholders despite calls for a standstill.
Analysis by The Daily Telegraph has revealed that BP's largest shareholders have cut their holdings in the troubled oil giant – with five of the group's top 10 shareholders selling shares in recent weeks.
The call for BP to dig deeper came as the company responded to an ultimatum to increase its efforts to contain the oil spill. US Coast Guard Rear Admiral James Watson accused BP of failing to have the right equipment or back-up plans, but the company said it was providing additional resources to recover more oil.
BP has indicated it is ready to suspend two quarterly dividend payments and place the money in an escrow account but a formal decision is unlikely before Wednesday's White House meeting between the President and Carl-Henric Svanberg, chairman, Tony Hayward, chief executive, Lamar McKay, chairman and president of BP America and Bob Dudley, a BP managing director.
President Obama, struggling to cope with public anger over his handling of the accident, plans to spend today and tomorrow in the Gulf to announce US government aid packages for the areas and businesses affected by the spill before returning to Washington for Wednesday's meeting, where observers question whether he will shake hands with Mr Hayward.
Mr Hayward is already in the US where he is being "groomed" for Wednesday's meeting and what is expected to be a tougher encounter on Thursday with a Congressional committee investigating the Gulf disaster. He will be hooked into today's board meeting by telephone.
David Axelrod, the President's chief political adviser, relayed the Obama demands for more cash on NBC's Meet The Press programme. He made it clear the President wants to see a substantial amount paid into an escrow account to meet growing claims. He said: "This is an ongoing crisis, much like an epidemic. Our mission is to hold them [BP] accountable in every appropriate way."
Bill McCollum. Florida's attorney general, has gone further, sending a letter to BP asking the company to put $2.5bn into an escrow account to cover potential losses.
BP has so far spent $1.4bn trying to cap the damaged well, contain the huge spill and provide compensation to businesses and employees. It has also promised to provide $350m for containment areas in Louisiana and has set aside $500m for long-term research into the spill.
BP's decision to consider a dividend freeze has been sharply contrasted with Transocean, the rig owner, which moved its headquarters from the US to Switzerland two years ago to ease tax bills. Transocean said the $1bn payout was announced in February and approved by shareholders on May 14, more than three weeks after the disaster and would not impact on its legal obligations resulting from the loss of the rig.
The company has also been accused of trying to limit its liabilities to just under $27m by using 159-year-old legislation, but after complaints by the US Justice Department it has agreed to consider claims under federal pollution and environmental laws.

Supermarket sales hit by economy fears

Tesco and J Sainsbury, two of the UK’s largest supermarkets, are both likely to confirm that sales across the supermarket sector have slowed markedly when they release trading updates this week.
Tesco, which shocked the market last week with news of the surprise departure of its chief executive, Sir Terry Leahy, is expected to say on Tuesday that like-for-like sales over its first quarter rose by between zero and 1.5pc, according to analysts’ forecasts. Some analysts have speculated that the figure could even fall. Clive Black, retail analyst at Shore Capital, said that he expects sales to be “flattish”, between -0.5pc to 0.5pc.
Meanwhile, Sainsbury’s is expected to say on Wednesday that like-for-like sales, including VAT, rose by between 0.5pc and 1pc over its first quarter. Excluding VAT, like-for-like sales are expected to have fallen by between 0.3pc and 0.5pc, according to some analysts’ forecasts.
Supermarkets across the board have been hit recently by rising petrol prices and the removal of food inflation from the market.
Just a year ago Tesco was seeing like-for-like sales growth of around 4pc while Sainsbury’s was seeing like-for-like sales growth of 7.8pc.
Bank of America Merrill Lynch said in a note to clients last week that Tesco and Sainsbury’s are “living with thin UK like-for-like sales”.
It said: “After visiting stores and having assessed the UK consumer outlook we reset our forecasts assuming a 1pc like-for-like industry growth for the remainder of 2010 and sub-par growth in 2011. Critically, we believe that the market will remain tough but rational and hence continue to see value in the UK grocers.”
It added, however, that a recent dip in petrol prices and the football World Cup could provide some relief to the chains.
“Ebbing comparative figures and easing petrol prices will help like-for-like sales as, short-term, as will the World Cup. Yet with an austere Budget well-flagged and the consumer finally taking note, we believe consumption will remain weak and, some may argue, will decline even for food retail,” the bank said.
Many observers believe that the slowdown should not cause too much concern and is an inevitable consequence of inflation coming out of the market. Consumers need food, no matter what is happening with the overall economy and inflation, analysts say.
Food retailers are, therefore, very defensive stocks for investors, it is argued.
In a note to clients last week, Deutsche Bank said: “We expect Sainsbury’s management will reassure on the profit outlook and believe it is unlikely that we get any other significant news in the statement given that the company fully updated the market at the time of its full-year results a month ago.”

Greece requests EU-IMF rescue in Euro’s biggest test

Greece called for activation of a financial lifeline of as much as 45 billion euros ($60 billion) this year in an unprecedented test of the euro's stability and European political cohesion.The appeal for help from the European Union and International Monetary Fund follows a surge in borrowing costs to what Greek Prime Minister George Papandreou called unsustainable levels that undermine efforts to cut a budget deficit of more than four times the EU limit. Greek bonds and stocks rallied after the announcement.
"There was no response from the markets, either because they didn't believe in the political will of the EU or because they decided to go on with speculation," Papandreou said today. "The situation threatens to demolish not only the sacrifices of the people but also the regular course of the economy. All the efforts by the Greek people are in danger of being in vain."
With national debt of almost 300 billion euros and investors demanding almost triple what they charge Germany for its 10-year bonds, Greece faces a fiscal mess that threatened to spread to Spain and Portugal, forcing the EU to set up a standby aid facility. At stake is the future of the euro 11 years after its creators gave the European Central Bank responsibility for interest rates while leaving budget policy in national capitals.
Rating Cut
The request came one day after the yield on the country's benchmark two-year note topped 11 percent, nearing that of Pakistan, and Moody's Investors Service lowered Greece's creditworthiness by one notch to A3, saying it was considering further cuts. After Papandreou's announcement, the 2-year yield declined 82 basis points to 9.41 percent.
The euro, which has slumped 7 percent this year as Greece undermined confidence in the single currency, rose from a one- year low yesterday of $1.3261 to $1.3311 today. Greece's ASE stock index gained 1.7 percent to 1892.32. The benchmark has shed almost a third of its value in the past six months as banks, the biggest holders of Greek bonds, slumped and concerns the crisis will lead to a prolonged recession hurt the rest of the market.
Activating the aid and turning over economic policy to EU and IMF oversight was "a new Odyssey for Greece," Papandreou said. "But we know the road to Ithaca and have charted the waters," referring to the return of mythological hero Ulysses to his island home.
One Roof
Economists including Harvard University Professor Martin Feldstein have said the single currency would falter because divergent economies couldn't fit under one monetary roof.
The Greek request needs approval from all 15 other euro- area countries including Germany, where surveys have shown public opposition to aiding Greece. BlackRock Inc., the world's largest money manager, has expressed concerns about a "backlash" from citizens in EU nations prepared to offer a lifeline.
"We want to see the EU countries really get behind it and see that they've gelled around the idea of providing this support at the government level, at the senior policy maker level," Curtis Arledge, chief investment officer of fixed income at BlackRock, said on April 13. "If you see the backlash, they need to get their people on board."
Discount Loans
The aid facility for Greece offers as much as 30 billion euros in three-year loans from euro-area nations this year at a below-market interest rate of around 5 percent. Another 15 billion euros are available from the IMF at even lower rates, EU officials have said. Greek officials started talks on April 21 in Athens with EU and IMF officials to set the conditions on funds before the loans are disbursed.
Those talks may last for at least two weeks. With Greece facing 8.5 billion euros of bonds maturing May 19 and little chance of tapping financial markets, Papandreou's request today could help speed distribution of the rescue funds.
"We are prepared to move expeditiously on this Request," IMF Managing Director Dominique Strauss-Kahn said today in a statement.
Under EU rules, governments must keep their budget deficits below 3 percent of gross domestic product. While the EU can penalize countries for breaching the limit, no nation has been sanctioned since the euro was introduced in 1999. Of the 16 euro region members, only Luxembourg and Finland had deficits within the limit last year.
Deficit Revisions
The government's deficit-cutting goal became questionable yesterday after Eurostat, the EU's statistics agency, revised up the 2009 shortfall to 13.6 percent of gross domestic product, and said it was considering a further revision to as much as 14.1 percent. The government in Athens had pledged to reduce the budget deficit by at least 4 percentage points of gross domestic product this year to 8.7 percent. When Greece first made that pledge, its starting point was a 2009 deficit of 12.7 percent. forced it now.
"The aid package will buy Greece time this year," said Colin Ellis, European economist at Daiwa Capital in London. "That's all that it has done. Greece still faces a herculean task to show that it can get its public finances in order and reduce its deficit."
Strikes, Protests
Greece's economy may contract 4 percent this year, twice as much as in 2009 and double the government's forecast, according to Deutsche Bank AG. After a wave of domestic protests against austerity measures, the government needs to raise almost 10 billion euros by the end of May to cover maturing bonds and another 20 billion euros by the end of the year to pay debt coupons and finance the deficit.
Greece failed to qualify for the euro area initially, joining two years later and only after understating its budget gap. With the euro, ECB interest rates that never exceeded 4.75 percent and EU funds to help build roads and airports, the country had economic growth of around 4 percent on an annual average basis -- one of the fastest in Europe -- until 2008 when Lehman Brothers Holdings Inc.'s collapse sparked a global financial crisis.
German Resistance
German politicians have expressed reluctance to aid Greece, citing the country's manipulation of statistics to qualify for euro entry and an EU treaty clause that prohibits bailouts.
Allies of Chancellor Angela Merkel, a Christian Democrat, criticized her for signing up to an April 11 European deal on the terms of any aid for Greece, saying she dropped an initial demand that subsidies be ruled out.
"Germany buckled under the pressure -- we shouldn't kid ourselves that such loans are anything but subsidies," Frank Schaeffler, deputy finance spokesman for Merkel's Free Democrat junior coalition partners, said at the time.
The Greek request for help also risks provoking a European fight with the IMF over control of the process, including the conditions. The rescue package covers three years and leaves open the sums of possible funding in 2011 and 2012.
The aid facility marked a compromise between French demands for the euro area to play the lead role and German insistence on involving the Washington-based IMF. On March 30, in a sign of the potential for conflict over supervision, IMF Managing Director Dominique Strauss-Kahn said his organization "will define the conditionality" of any rescue package for Greece.

Airlines press for compensation

As Europe's airspace reopened and weary passengers boarded long-delayed flights home, airline executives pressed for government compensation to cover the industry's massive losses.
Eurocontrol, Europe's air safety authority, said they expected air traffic to be "almost 100 percent" on Thursday, estimating that 75 percent of the 28,000 flights normally scheduled Wednesday had flown.
All Europe's main air hubs were up and running Wednesday and experts in Iceland said the Eyjafjjoell volcano had lost most of its intensity.
But a week after a volcanic eruption in Iceland caused the worst disruption to aviation since World War II, airline bosses were counting their losses -- and wanted to know who would foot the bill.
The International Air Transport Association (IATA) put the overall cost to the airline industry at 1.7 billion dollars (1.3 billion euros): at its peak, said IATA, the crisis was costing 400 million dollars a day.
"For an industry that lost 9.4 billion dollars last year and was forecast to lose a further 2.8 billion dollars in 2010, this crisis is devastating," said IATA chief Giovanni Bisignani in Berlin.
"Airspace was being closed based on theoretical models, not on facts."
Now governments needed to look at how to compensate the airlines, he said.
British Airways chief executive Willie Walsh had already branded the ban unnecessary, and British opposition leader David Cameron called for a public inquiry into the government's handling of the crisis.
Conservative leader Cameron, who is locked in an election battle with Labour Prime Minister Gordon Brown, said there had been "muddle and confusion" in the government over the crisis.
But as the recriminations flew, one vulcanologist advising the United Nations said the authorities had no choice but to close their airspace because of the lack of hard facts about aircraft behaviour in volcanic ash.
The April 14 decision by several European governments to close their airspace affected millions of would-be passengers around the world.
But the main hubs in the continent's flight networks expected to be running as normal Thursday.
Germany's Lufthansa, Europe's largest airline by passenger numbers, said it would fly at full capacity on Thursday by operating around 1,800 flights compared to the 700 it was able to run on Wednesday.
All long-haul passenger services from Paris' main international hub Charles de Gaulle were operating as scheduled, while Air France said it had flown 40,000 stranded people back home since Tuesday.
"Our traffic has returned to normal," a spokeswoman said.
And London Heathrow airport, the biggest and busiest in Europe, was going strong after reopening late Tuesday.
The only place in Britain still affected by the volcanic ash cloud was in the north, where the airspace over the remote Scottish isles of Orkney and Shetland were temporarily closed again due to still unsafe ash levels.
In Scandinavia, however, Denmark, Norway and Sweden lifted the last of their restrictions in a sign the worst of the threat had faded.
Some 450 British troops and 280 civilians stranded by the volcanic ash cloud finally made it back home Wednesday after a warship came to their rescue.
HMS Albion sailed into Portsmouth Naval Base on the southern English coast after a day-long crossing from Santander in northern Spain.
In Iceland, the civil protection agency said the volcano had lost nearly 80 percent of its intensity.
Einarsson, however, said the volcano had "not gone to sleep" and that it was impossible to predict when it would stop erupting.

Flights to Europe resume from Asia-Pacific

Europe-bound planes were leaving Asia-Pacific airports on schedule on Wednesday, as the region's airline industry estimated local carriers were losing 40 million dollars a day to the aerial lockdown.
Qantas and Singapore Airlines flights were due to take-off from Australia and New Zealand while Air China announced that all its Europe flights would also take to the skies.
Manila's only direct flight to Europe, a KLM service to Amsterdam, also left on schedule. Aircraft accelerating down runways marked what the industry hopes will be the end of an almost week-long lockdown caused by ash spewed from an Icelandic volcano.
Andrew Herdman, director-general of the Association of Asia Pacific Airlines (AAPA), said it was a "reasonable estimate" that Asia-Pacific airlines could lose 40 million dollars a day in revenue.
The International Air Transport Association (IATA) has estimated the loss for global airlines at 200 million euros (270 million dollars) a day.
Thousands of flights have been cancelled and hundreds of thousands of passengers stranded worldwide after European authorities designated much of the continent a no-fly zone due to ash clouds spewing from the volcano since last Wednesday.
But the first passengers among thousands stranded in Australia were due to fly out for Europe Wednesday afternoon, with a stopover in Asia. Air New Zealand planned three extra flights to help clear the backlog. "We hope to be getting passengers on flights from Australia this afternoon to make that connection with that flight to London," a Singapore Airlines spokeswoman told AFP. "We are resuming normal services as quickly as we can."
Flights to Europe were stopped from late Thursday as an ash cloud from the Icelandic eruption forced the closure of London's Heathrow and other European airports. The authorities fear the ash and dust could pose a danger to jet engines and airframes, but carriers worldwide have slammed the blanket shutout.
Qantas said it would resume services from Australia and Asia on Wednesday following the reopening of airspace across Europe.
"Qantas welcomes the opening of airspace and we will resume flights out of the UK to Australia today and from Asia to London and Frankfurt," chief executive Alan Joyce said.
"We are working on providing supplementary services to help clear the backlog and we will let our customers know as soon as possible," he said.
Qantas, which has seen as many as 10,000 passengers stranded by the airline chaos, said it was likely to take two to three weeks to clear the backlog.
Air New Zealand also said it planned to start resuming it services in and out of London from Wednesday.
New Zealand's national carrier said it plans three extra flights in the first 24 hours to try to start clearing the backlog of passengers.
Around 2,000 visitors to New Zealand have been stranded by the disruption to European services and 1,000 New Zealanders were reported to be stranded in Britain alone.
A Virgin Atlantic spokesman warned that European airspace may not stay open as the volcanic ash continues to threaten.
"Our 2:25 pm flight to London via Hong Kong is leaving. It's full to capacity," he said.
"I think our position is we're taking the opportunity while it exists."

230 Store Closings, 390 Store Openings

The International Council of Shopping Centers (ICSC) declared that March sales were the "best in 16 years." The L.A. Times said that "Pent-Up Demand Explodes for Retailers in March." CNNMoney announced that "super shoppers set records." With all those credible news sources screaming all those exuberant headlines, it's only logical to conclude that the U.S. retail industry must have been recovering, rebounding, rejuvenating, replenishing, and rebuilding the U.S. economy all at the same time in March.
All exuberant headlines aside, some clear-headed analysis of March's same store sales figures, in context with store closings and openings, unemployment numbers, and other underreported retail data tells the real story of the U.S. retail industry. In the real story, the plot is more complicated than the headlines suggest, and in the next chapter, as much as March figures were encouraging, the forecast for April is set up to be an equal disappointment.
According to the Thomson Reuters Same Store Sales Index, the 9.1% gain in same store sales in March was the biggest monthly gain since it began keeping records. Of that 9.1% year-over-year increase, six percentage points are attributed to an early Easter which motivated sales in the month of March, according to the ICSC. The record-breaking March sales figure is a comparison to the March 2009 index, which was down 5.0%, (excluding Wal-Mart (WMT) sales, which is today's norm). This is also on top of a March 2008 index decline of 2.1% (also excluding Wal-Mart).

Doing the math, 9.1%, take away 6 holiday percentage points, makes a 3.1% gain. A 3.1% gain on top of a 5.0% loss, on top of another 2.1% loss does not inspire as much euphoria as the headlines indicated we should all be feeling.
Basically, March stole sales from April, and April 2009 stole sales from March 2009, which is how the Easter dance goes each year. There will be no meaningful conclusions that can be made about retail recovery, rebound, rejuvenation, replenishment or economic rebuilding until April sales results come in and the two months are looked at together. And, so far, nobody is forecasting April sales to break any records, at least not any good records.
Even if overall March same store sales figures weren't as impressive as they seem to be on first impression, certainly there were some noteworthy individual chain results to be exuberant about, right?
Comparing the March 2009 same store sales with March 2010, it is obvious that a list filled with double-digit gains this year is preferable to a list full of double-digit losses last year. But once again, reason subdues the euphoria because same store sales is a year-over-year comparison, which means that unless you take both years into consideration, the figures have no meaning.
In March, 2009, only nine major retail chains managed to pull out a positive same store sales number. Besides these nine, every other gain this year is in comparison to a loss, and many of this year's headline writers seem to have forgotten how devastatingly large those March 2009 losses actually were.
It wasn't really difficult for Abercrombie & Fitch's (ANF) sales this year to best the 34.0% decline of March 2009. Nor was it a stretch for Neiman Marcus' sales numbers to look good compared to its 30.0% March, 2009 same store sales plummet. Saks' (SKS) 12.7% same store sales increase this year, was barely more than half of its 23.6% decline last March.
The March same store sale increases at American Eagle (AEO), Costco (COST), Zumiez (ZUMZ), Wet Seal (WTSLA), JC Penney (JCP), Stage Stores (SSI), and Dillard's (DDS) while positive this year, did not cover the losses that they posted in the same month last year. Their losses weren't recovered this year even with the holiday, warm weather, and pent-up demand that supposedly caused consumers to "come back from the dead," and sales to "surge" in March.
A look at a multi-year comparison of March same store sales provides even more perspective about the relativity of March's sales gains across the board for the U.S. retail industry.
Thinking logically, if retailers were unable to cover last year's losses in a perfect storm of positive conditions, what do we really expect they are going to be able to produce in a non-holiday April 2010 to compare with the Easter April of 2009? And when all four of those months are looked at together, do we really think we're going to be describing what we see as "explosive" or the "best in 16 years?"
Aren't we ever going to grow weary of the roller coaster ride of economic microanalysis and short-sighted predictions?
Certainly there were some same store sales winners in March, but most of them were not at the top of the list. Cato (CATO) is a chain that isn't generally seen as a U.S. retail industry pacesetter, so to find the conservative fashion retailer at the top of the same store sales figures list in March is definitely notable. Digging into its March history, though, reveals that Cato's March 2010 sales were just slightly higher than its 2005 sales, which diminishes the significance of the chain's March accomplishment.
Of the nine retailers that managed to eke out same store sales gains in 2009, three really stand out as no-excuses, consistent, positive performers this year.
Buckle (BKE) was at the top of the same store sales list in March, 2009, with a 14.7% increase. That March increase was on top of the 20.9% increase in March 2008, and a 10.7% increase in March, 2007. Buckle had the same holiday calendar, weather conditions, and economic pressures as every other retailer, and yet it still found a way to improve its performance for several challenging March's in a row. Although its March, 2010 same store sales increase was not a double digit and, therefore, was far from the top of the list this year, Buckle's year-over-year-over-year-over-year increases really are the most impressive of the month.

Discovery on the way to Earth after visit to space station

The US space shuttle Discovery was on its way back to Earth early Monday after a successful supply mission to the International Space Station, leaving NASA's shuttle program with just three more flights.
The crew aims for touchdown at NASA's Kennedy Space Center in Florida at 8:48 am (1248 GMT) with no threat from the huge ash cloud from an erupting Icelandic volcano that has shut down air traffic over Europe, the US space agency said.
Over a 14-day mission, Discovery's seven-member crew delivered nearly eight tons of scientific equipment and other supplies intended to fortify the orbiting science laboratory for operations beyond NASA's final shuttle launch.
Once the shuttles are retired, with Discovery's final flight on September 16, the United States will rely on Russia to take astronauts to the station until a new fleet of commercial space taxis is operational.
President Barack Obama reiterated this controversial policy during a visit to the shuttle's Florida landing site last week.
Monday's forecast at Cape Canaveral includes overcast skies and a chance of showers, but shuttle commander Alan Poindexter and his crew have a backup landing opportunity in Florida later in the morning at 10:23 am (1423 GMT).
The astronauts took power conservation measures Sunday in case the meteorological conditions delayed their return by a day.
"The weather situation is always fluid, and we will keep watching it," Mission Control in Houston told Discovery.
The shuttle is provisioned to remain in orbit until Wednesday if necessary, said Bryan Lunney, NASA's supervising flight director.
Monday's descent will follow a rare northwest to southeast course over the United States, leaving a glowing contrail visible to observers across several states should skies remain clear.
Discovery lifted off on April 5 and docked with the space station two days later, overcoming a communications antenna failure that crippled their rendezvous radar.
The linkup united 13 US, Russian and Japanese astronauts from the two craft for 10 days. Four were women, the highest number of females in space at any one time.
Over the course of three spacewalks, astronauts replaced a bulky external coolant tank. The ammonia reservoir circulates a coolant through outstretched radiators to disperse the heat generated by the station's internal electronics, including the life-support systems.
The science hardware delivered by Discovery included an Earth observations rack to hold cameras and spectral scanners for studies of the atmosphere, land forms, coastal areas as well as weather-induced crop damage.
Another new experiment will measure changes in muscle and joint health of astronauts during their long exposures to weightlessness, and a new freezer Discovery delivered will hold blood and other specimens collected for experiments.
During his April 15 visit to Kennedy, Obama made no mention of a shuttle program extension, disappointing some in Congress and those employed by the multi-billion-dollar space flight program.
At NASA, the looming reality that the United States will soon be unable to launch its own astronauts for the first time in three decades has begun to sink in.
"We're very excited about the future direction of human exploration in space," insisted Poindexter to reporters Sunday, saying the crew in space had been able to follow Obama's remarks last week.
"I'm sure that it's running through people's minds, but we are professionals and we are working really hard on the missions in front of us," Richard Jones, lead NASA flight director for the Discovery mission, said earlier in the day.
"As we get closer, that will be forefront on people's minds."
Discovery's pilot Jim Dutton, who was making his first and possibly last space flight, echoed the sentiments.
"I think everyone feels a little bittersweet," Dutton said. "We love the shuttle, but we have to press on into the future."

China may face cotton supply shortage

China, the world's biggest cotton consumer, may face a domestic supply shortage on falling output and reduced international supplies, an analyst at state-backed CNCotton.com said. Domestic consumption may outstrip available supply by 3.5 million metric tons in the 2009-2010 marketing year ending Aug. 31, and supply will remain tight next year, Mei Yong, a director at the portal owned by China National Cotton Reserves Corp., said at an April 16 conference in Shandong.
China's double-digit economic growth is spurring textile consumption while cotton output last year shrank on reduced planting. Exports of products made with the fiber surged as textile buyers worldwide replenished inventories that had been depleted during the financial crisis, Mei said.
"China may need to import another 1 million tons" of cotton to bridge the gap, said Deng Jun, chief economist at Xinhu Futures Co. If China goes to the global market, it will further reduce projected low ending stocks in the U.S. and "U.S. cotton prices are very likely to surge" as funds won't let such a good investment opportunity pass, he said.
The most-active cotton contract in New York last traded at 80.75 cents a pound. Prices have gained 6.8 percent this year after surging 54 percent last year, the most since 1975.
Cotton for September delivery traded on the Zhengzhou Commodity Exchange may advance to more than 18,000 yuan ($2,637) a ton, or over 90 cents a pound for cotton traded in New York, Deng said. The contract settled at 16,790 yuan today.
New High
"Whether there is a shortage depends on how demand may play out going into August and September," said Dong Shuzhi, assistant general manager of Jinshi Futures Co., by phone from Shanghai today. It is possible that cotton may reach new high by August, he said.
Still, "much depends on the uncertain weather and economy, because unemployment in the U.S. remains high and unless global consumers start spending, exports may ''fizzle,'' he said.
Both Dong and Mei said this year's weather outlook so far for cotton planting isn't good because excessive rain and cold temperatures have caused delays.
This year may be ''a period of high cotton prices," Mei said, who along with Deng spoke at the conference, which was organized by Xinhu Futures.
China's cotton users currently have inventories that may last until July, Mei said, citing her firm's research.
Rising Demand
Yarn producers, who weave cotton into cloth, are racing to meet rising demand from apparel makers, said Liu Shuguang, a manager at Linyi Jinyuan Textile Trade Ltd. in Shandong, China's second-biggest cotton grower. "It's been a good year," he said.
Even if the government issues additional quotas, it is questionable buyers may be able to secure overseas supplies, Mei said. India, the biggest supplier so far in the current marketing year that began Sept. 1, has "basically closed its door" on China after it levied a 3 percent tax on cotton exports to ensure its own supply, she said.
The U.S., China's other big supplier, only has about 600,000 tons left for exports based on projected sales for the marketing year less what's already been sold, she said. West Africa, Uzbekistan and Brazil all have "little" output, while other Asian textile producers such as Pakistan and Bangladesh will compete "ferociously" for "limited global supply."
While it's possible the government may sell some of its reserves to boost supply, it will have little effect on the market because of its limited quantity, Mei said without saying how much the actual reserve is.
China's total exports of textile goods in the first quarter gained 15 percent from year ago to $39.2 billion, the National Development and Reform Commission said April 15, adding demand outlook may slow given uncertainty in global economic recovery.
Output of yarn, spun from cotton, gained 20 percent to 5.7 million tons in the first three months from a year ago while imports of cotton in the period gained threefold to 856,000 tons, it said.

Friday, October 1, 2010

Economy impact to rise sharply if ash lingers

The economic impact of the volcanic cloud halting flights across Europe will increase sharply the longer disruption continues, forcing holiday cancellations, delaying deliveries and reducing jet fuel demand.
African exporters of flowers and vegetables by air to European supermarkets, technology companies relying on "just-in-time" deliveries of components, event organisers and others could all feel the pinch.
Economists say so far they have not changed their models or predictions for European growth, hoping normal service could resume this week. But in a worst-case scenario in which the ash cloud closes European airspace for months, one economist estimates lost travel and tourism revenue alone could knock 1-2 percentage points off regional growth as long as it lasts. European growth had been predicted at 1-1.5 percent for 2010.
"That would mean a lot of European countries wouldn't get any growth this year," said Vanessa Rossi, senior economic fellow at Chatham House. "It would literally stifle the recovery. But the problem is it is incredibly hard to predict what will happen. Even the geologists can't tell us."
The event is a classic example of a "Black Swan", a totally unexpected event with widespread impact, impossible to predict and hard to model.
The key questions now are whether the volcano keeps erupting and spewing ash into the atmosphere, where the wind takes the ash and how long the ash already in the sky remains over Europe.
Vulcanologists and meteorologists say they cannot immediately answer those questions as volcanoes are particularly unpredictable. They warn the last time the volcano under the Eyjafjallajokull glacier erupted, it lasted more than a year. But it may not continue to spew ash for the entire eruption.
Most had originally expected the cloud and disruption would linger over Europe for several days.
Travel and tourism accounts for around five percent of global gross domestic product -- some $3 trillion -- with Europe accounting for a third of that, much of it accruing over the summer months. Not all of this will be lost, but Rossi estimated a prolonged shutdown could cost up to $5-10 billion dollars a week in the industry.
But the impact will likely be wider. Most of the world's goods by volume may move by sea and land, but transport analysts estimate 40 percent by value moves by air.
The world's biggest air freight operators say they are moving what they can by road and looking at contingency plans of using southern European airports that are outside the cloud. But they say deliveries will be sharply affected.
"If your just-in-time operation is depending on parts that come from Asia or the US or Africa or the Mideast, you just can't get it," said United Parcel Service Inc spokesman Norman Black.
"DHL and UPS use airhubs in Germany, Fedex Corp relies on an airhub in France and all that airspace is closed. There's just not an option right at the moment while we all wait and see how long this is going to take."
Pharmaceutical firms are heavy users of air freight, but most said on Friday they had enough stocks to avoid a short-term crunch. Last-minute high-tech imports between Asia and the United States are flown over the Pacific and will be unaffected, but European firms may feel the pinch.
Most food and beverage deliveries move by sea, but some premium products such as the finest Scotch whiskeys retailing at hundreds of dollars a bottle in China or Japan can no longer be moved.
That could mean the most vulnerable national economies to the shutdown could prove to be African producers of fruit and flowers that will swiftly perish if not shipped to market.
The International Air Transport Association (IATA) estimates airlines are losing $200 million a day from the shutdown, which has caused chaos well beyond the immediate European airspace closed. Most airlines will be uninsured for this loss, although insurer Munich Re said on Friday it would consider offering cancellation insurance in future should the crisis produce demand.

How not to raise a bully: the early roots of empathy

Since the Jan. 14 death of Phoebe Prince, the 15-year-old in South Hadley, Mass., who committed suicide after being bullied by fellow students, many onlookers have meditated on whether the circumstances that led to her after-school hanging might have been avoided.
Could teachers have stepped in and stopped the bullying? Could parents have done more to curtail bad behavior? Or could preventive measures have been started years ago, in early childhood, long before bullies emerged and started heaping abuse on their peers?
Increasingly, neuroscientists, psychologists and educators believe that bullying and other kinds of violence can indeed be reduced by encouraging empathy at an early age. Over the past decade, research in empathy - the ability to put ourselves in another person's shoes - has suggested that it is key, if not the key, to all human social interaction and morality.
Without empathy, we would have no cohesive society, no trust and no reason not to murder, cheat, steal or lie. At best, we would act only out of self-interest; at worst, we would be a collection of sociopaths.
Although human nature has historically been seen as essentially selfish, recent science suggests that it is not. The capacity for empathy is believed to be innate in most humans, as well as some other species - chimps, for instance, will protest unfair treatment of others, refusing to accept a treat they have rightfully earned if another chimp doing the same work fails to get the same reward.
The first stirrings of human empathy typically appear in babyhood: newborns cry when hearing another infant's cry, and studies have shown that children as young as 14 months offer unsolicited help to adults who appear to be struggling to reach something. Babies have also shown a distinct preference for adults who help rather than hinder others.
But, like language, the development of this inherent tendency may be affected by early experience. As evidence, look no further than ancient Greece - at the millennia-old child-rearing practices of Sparta and Athens. Spartans, who were celebrated almost exclusively as warriors, raised their ruling-class boys in an environment of uncompromising brutality - enlisting them in boot camp at age 7, and starving them to encourage enough deviousness and cunning to steal food - which skillfully bred yet more generations of ruthless killers.
In Athens, future leaders were brought up in a more nurturing and peaceful way, at home with their mothers and nurses, starting education in music and poetry at 6. They became pioneers of democracy, art, theater and culture. "Just like we can train people to kill, the same is true with empathy. You can be taught to be a Spartan or an Athenian - and you can taught to be both," says Teny Gross, executive director of the outreach group Institute for the Study and Practice of Nonviolence in Providence, R.I., and a former sergeant in the Israeli army.
What the ancient Greeks intuited is supported by research today. Childhood - as early as infancy - is now known to be a critical time for the development of empathy. And although children can be astonishingly resilient, surviving and sometimes thriving despite abuse and neglect, studies show that those who experience such early trauma are at much greater risk of becoming aggressive or even psychopathic later on, bullying other children or being victimized by bullies themselves.
Simple neglect can be surprisingly damaging. In 2007, researchers published the first randomized, controlled study of the effect of being raised in an orphanage; that study, and subsequent research on the same sample of Romanian orphans, found that compared with babies placed with a foster family, those who were sent to institutions had lower IQs, slower physical growth, problems with human attachment and differences in functioning in brain areas related to emotional development.
Institutionalized infants do not experience being the center of a loving family's attention; instead, they are cared for a rotating staff of shift workers, which is inherently neglectful. Such children miss out on intensive, one-on-one affection and attachment with a parental figure, which babies need at that vulnerable age. Without that experience, they learn early on that the world is a cold, insecure and untrustworthy place. Their emotional needs having gone unmet, they frequently have trouble understanding or appreciating the feelings of others.
Nearly 90% of brain growth takes place in the first five years of life, and the minds of young children who have been neglected or traumatized often fail to make the connection between people and pleasure. That deficit can make it difficult for them to feel or demonstrate love later on. "You can enhance empathy by the way you treat children," says Martin Hoffman, an emeritus professor of psychology at New York University and a pioneer of empathy research, "or you can kill it by providing a harsh punitive environment."
Discipline, but Don't Punish?
The cold environment of an orphanage can be considered on a spectrum of punishment, at the other end of which is simple child discipline - an issue that sometimes confounds even the most mindful parents. How do you teach a child right from wrong without being too tough, or slipping into abuse? Who among us has not raised our voice - O.K., screamed - while disciplining our children?
But shouting at or, worse, hitting a child results in fear, rather than an understanding on the child's part of why he or she is being punished, say researchers. Over the long term, the routine use of corporal punishment, such as spanking, not only fails to change behavior for the better, but has also been shown to increase aggression in children.
"Instead of starting from the assumption that you have to beat the badness out of a child, turn on that empathy and compassion switch," says Dacher Keltner, professor of psychology at the University of California, Berkeley, and author of Born to Be Good: The Science of a Meaningful Life.
In other words, start by teaching children to understand their own behavior and feelings - it provides the basic tools for understanding the behavior and feelings of others. For instance, when dealing with a child who has hurt another person, help him or her "anchor how they felt in the moment," says Mary Gordon, founder of Roots of Empathy, a school-based program designed to foster compassion. "We always think we should start with, 'How do you think so-and-so felt?' But you will be more successful if you start with, 'You must have felt very upset.' The trick is to help children describe how they felt, so that the next time this happens, they've got language. Now, they can say 'I'm feeling like I did when I bit Johnny.'"
In Gordon's Roots of Empathy program, which is currently being used in about 3,000 kindergartens, elementary schools and middle schools in Canada, and 40 schools in Seattle, children get to see a visiting parent and infant interact in the classroom about once a month, and watch the foundations of empathy being built. When the baby cries, the Roots of Empathy instructor helps the mother and students think about what might be bothering the baby and how to make things better.
Students are taught that a crying baby isn't a bad baby, but a baby with a problem. By trying to figure out what's going on, the children learn to see the world through the infant's eyes, and to understand what it might be like to have needs but not be able to express them clearly.
"We love when we get a colicky baby," says Gordon, because then the mother usually tells the class how frustrating and annoying it is when the baby won't stop crying. That gives children insight into the parent's perspective - and how children's behavior can affect adults - something they have often never thought about. "If you look at the development of empathy, one of the key features is perspective-taking," says Gordon. "In coaching that skill, we help them [take the perspective of] their classmates."
To date, nine separate studies have shown that Roots of Empathy has helped reduce bullying at school, and increased supportive behavior among students. Many school districts in the U.S., including New York City's, have recently expressed interest in using Gordon's approach.
Setting an Empathetic Example
Her own family was a shining example. As a young girl in Newfoundland, Gordon says she grew up in a large, multigenerational family - including four siblings, two grandparents and a mentally disabled uncle - that also often included "strays." Her parents liked to take in people in need: unmarried pregnant women who had no place to go, recently released prisoners who would stop by for a free meal. Gordon also tagged along with her mother, an artist (Gordon's father was the Canadian minister of labor), as she visited poor families in the community, bringing them food, clothing and coal for heat.
When young Mary sneered and asked why a woman stored coal in her bathtub instead of bathing in it, her mother admonished her - but in private. "My mom would never embarrass anyone, so she wouldn't embarrass me as a child either. She saw the dignity in everybody," Gordon says. "In the car, she said, 'You judged that woman when you made that face.' She would say, 'She's made the best decisions she could with the challenges she has, and you don't know her challenges.'"
Not every child is raised by a Mother Gordon. But even children who have survived rough environments - like the gang members Teny Gross of the Institute for the Study and Practice of Nonviolence works with in Providence - can be helped to "catch" empathy.

Gross has found that his outreach workers are most successful when they build relationships based on caring and fairness. "People have a sense of justice," Gross says, explaining why even troubled teens respond well when counselors, with whom they have an ongoing relationship, take a firm stance with them regarding their behavior. "[Our kids are] used to injustice; they're used to abuse at school and from the police. But when constraints come from a place of love and caring, people don't think it violates their sense of justice.
Gross's program focuses on introducing young men and boys in gangs to a new network of people who not only care about them, but do so dependably - providing the kind of secure environment that many of them missed in childhood. By employing former gang members to mentor the troubled boys, Gross makes it easier for them to foster relationships of mutual understanding and connection with one another. Mentors show up consistently at the boys' important events - court dates, funerals - demonstrating care and concern. They also organize social outings for the boys, like a trip to a local beach last summer for a day of surfing. That excursion purposefully included boys from rival gangs, in the hopes that the introductions could help reduce violence later on.

Mobile phones more common than toilets in India

More people in India have access to a mobile telephone than to a toilet, according to a study by United Nations University (UNU) on how to cut the number of people with inadequate sanitation.
"It is a tragic irony to think that in India, a country now wealthy enough that roughly half of the people own phones, about half cannot afford the basic necessity and dignity of a toilet," said Zafar Adeel, Director of United Nations University's Institute for Water, Environment and Health (IWEH), and chairman of UN-Water, a coordinating body for water-related work at 27 UN agencies and their partners.
India has some 545 million cell phones, enough to serve about 45 per cent of the population, but only about 366 million people or 31 per cent of the population had access to improved sanitation in 2008.
The study released Wednesday are meant to accelerate the pace towards reaching the Millennium Development Goal (MDG) on halving the proportion of people without access to safe water and basic sanitation. If current global trends continue, the World Health Organization (WHO) and the United Nations Children's Fund (UNICEF) predict there will be a shortfall of 1 billion persons from that sanitation goal by the target date of 2015.
"Anyone who shirks the topic as repugnant, minimizes it as undignified, or considers unworthy those in need should let others take over for the sake of 1.5 million children and countless others killed each year by contaminated water and unhealthy sanitation," said Adeel.
Included in the study's nine recommendations are the suggestions to adjust the MDG target from a 50 per cent improvement by 2015 to 100 per cent coverage by 2025; and to reassign official development assistance equal to 0.002 per cent of gross domestic product (GDP) to sanitation.
The UNU report cites a rough cost of $300 to build a toilet, including labour, materials and advice. The world can expect, however, a return of between $3 and $34 for every dollar spent on sanitation, realized through reduced poverty and health costs.

Russian companies may list in Hong Kong

As many as five Russian companies may follow billionaire Oleg Deripaska's United Co. Rusal and list in Hong Kong by 2012, said Elena Khisamova, head of equity capital markets at the investment banking arm of VTB Group.
Gazprom Says 'Abnormal' Gas-Price Gap to Undermine Investment OAO Gazprom, the world's biggest natural-gas producer, said an "abnormal" gap between spot fuel prices and long-term contracts is threatening investments in new fields and pipelines.
Hungary's Mol Says Pakistan Gas Production Unaffected by Battle Mol Nyrt, Hungary's largest refiner, said an escalation in fighting in Pakistan's northwest has not disrupted its natural gas facilities in the country.
Asseco Poland to Set Price in Rights Offering on April 19 Asseco Poland SA, the Polish company that's central Europe's largest software maker, plans to set the issue price in the rights offering on April 19, when it's scheduled to publish the prospectus.
Lithuanian Coalition Breakup Won't Hurt Rating, Moody's Says
Any breakup of Lithuania's ruling coalition is unlikely to hurt the economy or impact the Baltic nation's Baa1 credit rating, Moody's Investor Service said.
Rusagro Plans Share Sale to Finance Expansion, Acquisitions OAO Rusagro Group, a Russian agricultural holding company, plans to sell stock to fund expansion and acquisitions.
Eastern European Stock Markets Poland's WIG20 Index rose 0.7 percent, the Czech PX Index rose 3.1 percent and Hungary's BUX Index gained 0.7 percent. The 30-stock Micex Index gained 1.8 percent to 1,526.61. The dollar-denominated RTS Index rose 1.8 percent to 1,673.41.
Berling SA (BRG PW): The Polish wholesaler of refrigeration equipment will start trading on the Warsaw Stock Exchange, the bourse said in an e-mail on April 14.
Bank BPH SA (BPH PW): The Polish unit of General Electric Co. said it won't pay a dividend for 2009. Bank BPH shares rose 2.1 percent to 73.5 zloty.
OAO Raspadskaya (RASP RX): Raspadskaya's 2009 profit fell 78 percent to $117 million, as sales declined 59 percent to $497 million. Shares of the Russian coking coal producer rose 1 percent to 220.72 rubles.
OAO Novolipetsk Steel (NLMK RX): The steelmaker owned by Vladimir Lisin, Russia's richest man, may report first-quarter production numbers tomorrow. Novolipetsk shares rose 2 percent to 112.93 rubles.
OAO Polyus Gold (PLZL RX): Gold rose as the dollar's slide enhanced the appeal of the metal as an alternative investment, and signs of a global economic recovery boosted demand for commodities. VTB Capital rated Polyus a new "buy." The shares of Russia's largest producer of gold fell 1.1 percent to 1,460.57 rubles.
World Markets
Asian Stocks Rise on China Growth, U.S. Earnings; Canon Gains Asian stocks rose, driving the MSCI Asia Pacific Index to a 20-month high, as faster economic growth in China and U.S. earnings reports buoyed confidence in the global recovery.
Yen Drops for Sixth Day Versus Euro on Recovery, Risk Appetite The yen fell for a sixth day versus the euro, the longest drop since January, as signs the global economy is gaining traction boosted demand for riskier assets.
Treasuries Give Up April Gain as Factory Production May Quicken
Treasuries were poised to finish the first half of April with a loss as economists said a Federal Reserve report today will show industrial production accelerated in March.
Oil Rises for Second Day on Gain in U.S. Demand, China Growth
Oil climbed for a second day in New York after a report showed U.S. crude supplies fell as gasoline demand increased and as China posted its fastest economic growth in almost three years.
Copper Advances for Second Day as China Reports Faster Growth
Copper rose for a second day as China, the world's largest consumer, reported that economic growth in the first quarter accelerated to the fastest pace in almost three years.
Newspaper Highlights
Immofinanz to Buy Constantia Bad Bank for EU0.5Mln, WiBlatt Says
Immofinanz AG has agreed to pay about 500.000 euros ($681,550) to take over the "bad bank" of Semper Constantia Privatbank AG, Wirtschaftsblatt reported, citing unidentified people involved in the negotiations.
Russian Minister Says High Import Tariffs to Stay, WSJ Reports
Russia will retain the high import tariffs imposed last year as it tries to soften the effect of the global financial crisis on its economy, the Wall Street Journal reported, citing remarks made by Deputy Prime Minister Igor Shuvalov.
Posco Seeks to Buy Ukraine's Zaporizhstal, MoneyToday Says
Posco is seeking to buy Ukrainian steelmaker Zaporizhstal, MoneyToday reported, without citing anyone.
NYSE Euronext May Open Grain Bourse in Ukraine, Delo Reports
NYSE Euronext may open a grain exchange in Ukraine and is seeking local partners, Delo newspaper reported, citing Leonid Kozachenko, president of the Ukrainian Agrarian Confederation.

Summit concludes with pledge to strengthen nuclear security

World leaders vowed at a summit Tuesday to enhance nuclear security through a range of measures while also supporting implementation of strong security practices that will not infringe upon the rights of States to develop and utilize nuclear energy for peaceful purposes and technology.
The Nuclear Security Summit convened by US President Barack Obama concluded this afternoon after a full day of debate on national and international actions for securing nuclear material and the role of the IAEA in the area of nuclear security.
The summit concluded with the issuance of a Communique, which is a non-binding political declaration. The Communique recognizes that nuclear security within a state is entirely the responsibility of that state.
It stresses the need for facilitating national actions through international capacity building cooperation and exchange of relevant technology as well as expertise, on a voluntary basis.
The Communique is supplemented by a non-binding Work Plan which identifies specific measures which states may take for strengthening nuclear security at the national level in accordance with respective national policies and laws as well as international obligations.
Prime Minister Syed Yusuf Raza Gilani, who was one of the lead speakers in the inaugural session of the Summit, projected Pakistan's point of view in an effective manner.
Highlighting the steps taken by Pakistan for the safety and security of nuclear materials and facilities, Pakistan's multi-layered command and control structures, its comprehensive regulatory regime as well as export control mechanisms, the Prime Minister called for non-discriminatory access for Pakistan to civil nuclear technology to meet the country's growing energy requirements.
Prime Minister Gilani expressed Pakistan's full support for the role of the International Atomic Energy Agency (IAEA) as a platform for international cooperation in the area of nuclear security, including capacity building assistance and exchange of technology.
"In addition to our shared goals of nuclear disarmament, nuclear non-proliferation and peaceful uses of nuclear energy, we also all share the objective of nuclear security. Therefore those gathered here in Washington DC on April 13, 2010 commit to strengthen nuclear security and reduce the threat of nuclear terrorism. Success will require responsible national actions and sustained and effective international cooperation," leaders of around 50 nations said in the communique.
Besides five major recognized nuclear powers, a number of important countries including South Asian powers India and Pakistan attended the summit.
The communique termed nuclear terrorism "one of the most challenging threats to international security," and noted that "strong nuclear security measures are the most effective means to prevent terrorists, criminals, or other unauthorized actors from acquiring nuclear materials.
The participating nations welcomed and join President Obama's call to secure all vulnerable nuclear material in four years, as we work together to enhance nuclear security.
They "reaffirmed the fundamental responsibility of States, consistent with their respective international obligations, to maintain effective security of all nuclear materials, which includes nuclear materials used in nuclear weapons, and nuclear facilities under their control; to prevent non-state actors from obtaining the information or technology required to use such material for malicious purposes; and emphasize the importance of robust national legislative and regulatory frameworks for nuclear security."
The Communique called on States to work cooperatively as an international community to advance nuclear security, requesting and providing assistance as necessary.
The Communique recognized "highly enriched uranium and separated plutonium require special precautions" and agrees to promote measures to secure, account for, and consolidate these materials, as appropriate; and encourage the conversion of reactors from highly enriched to low enriched uranium fuel and minimization of use of highly enriched uranium, where technically and economically feasible.
The world leaders pledged to :
Endeavor to fully implement all existing nuclear security commitments and work toward acceding to those not yet joined, consistent with national laws, policies and procedures;
Support the objectives of international nuclear security instruments, including the Convention on the Physical Protection of Nuclear Material, as amended, and the International Convention for the Suppression of Acts of Nuclear Terrorism, as essential elements of the global nuclear security architecture;
Reaffirm the essential role of the International Atomic Energy Agency in the international nuclear security framework and will work to ensure that it continues to have the appropriate structure, resources and expertise needed to carry out its mandated nuclear security activities in accordance with its Statute, relevant General Conference resolutions and its Nuclear Security Plans;
Recognize the role and contributions of the United Nations as well as the contributions of the Global Initiative to Combat Nuclear Terrorism and the G8-led Global Partnership Against the Spread of Weapons and Materials of Mass Destruction within their respective mandates and memberships;
Acknowledge the need for capacity building for nuclear security and cooperation at bilateral, regional and multilateral levels for the promotion of nuclear security culture through technology development, human resource development, education and training; and stress the importance of optimizing international cooperation and coordination of assistance;
Recognize the need for cooperation among States to effectively prevent and respond to incidents of illicit nuclear trafficking; and agree to share, subject to respective national laws and procedures, information and expertise through bilateral and multilateral mechanisms in relevant areas such as nuclear detection, forensics, law enforcement and the development of new technologies;
Recognize the continuing role of nuclear industry, including the private sector, in nuclear security and will work with industry to ensure the necessary priority of physical protection, material accountancy and security culture;
Support the implementation of strong nuclear security practices that will not infringe upon the rights of States to develop and utilize nuclear energy for peaceful purposes and technology and will facilitate international cooperation in the field of nuclear security; and Recognize.

World nuclear summit confronts ‘growing’ threat

Ukraine renounced its bomb-grade uranium on Monday in a boost for President Barack Obama's summit on securing the world's nuclear materials, as a US official warned of the 'growing' risk of nuclear terrorism.
Obama called the 47-nation summit in Washington, the biggest hosted by a US leader since 1945, to try to secure loose materials in military and civilian stockpiles worldwide within four years.
The gesture from ex-Soviet republic Ukraine, site of the horrific 1986 Chernobyl nuclear power plant explosion, gave early impetus to the summit.
Newly inaugurated President Viktor Yanukovych told Obama in a bilateral meeting that he would give up 90 kilos (180 pounds) of Ukraine's highly enriched uranium, enough to make several bombs, the White House said.
But Obama's top terrorism advisor John Brennan warned that al Qaeda's interest in nuclear weapons was "strong" and warned the risk of nuclear terrorism was "real," "serious" and "growing."
Leaders from China, Pakistan, Russia and dozens of other countries converged on a heavily guarded conference center for the two-day meeting on securing worldwide stocks of separated plutonium and enriched uranium that militant groups could use to manufacture crude, but devastating weapons.
Following Ukraine's pledge, Canada made a similar promise on its own smaller stockpile, as had Chile earlier.
Overshadowing the conference was growing tension on Iran, which the United States and its allies accuse of covertly working on a nuclear weapon. Iran says it is pursuing only civilian power.
Obama and Chinese President Hu Jintao agreed their delegations would work together at the United Nations on a US-led push to impose sanctions against Iran, a US official said.
"They are prepared to work with us," said Jeff Bader, Obama's top official responsible for East Asia on the National Security Council."The two presidents agreed the two delegations should work together on sanctions," Bader said.
North Korea, which defied international pressure to produce a nuclear weapon, was also likely to loom over the summit. Neither the leaders of North Korea or Iran attended.
Iran's envoy to the UN nuclear watchdog, Ali Asghar Soltanieh, accused Washington of being the "real" threat to global peace given its large nuclear arsenal.
"The outcome of the Washington conference is already known. Any decision taken at the meeting is not binding on those countries who are not represented at the conference," Soltanieh told ISNA news agency.
Another notable absentee from Washington was Israeli Prime Minister Benjamin Netanyahu who dropped plans to attend, reportedly because of concern that Islamic states planned to press for Israel to open its own nuclear facilities to international inspection.
Obama told reporters that his consultations so far with world leaders had been "impressive."
"I think it's an indication of how deeply concerned everybody should be with the possibilities of nuclear traffic.
"I think at the end of this we're going to see some very specific, concrete actions that each nation is taking that will make the world a little bit safer."
Ahead of the summit on Sunday he branded attempts by non-state groups to obtain nuclear devices "the biggest threat to US security, both short-term, medium-term and long-term."
"This is something that could change the security landscape of this country and around the world for years to come," Obama said Sunday.
The conference is also a precursor to the United Nations Non-Proliferation Treaty review conference next month, seen as another important moment in heading off a future nuclear arms race.

Sarkozy: France will not give up nuclear weapons

France will not give up its nuclear weapons, because doing so would 'jeopardize' its security, President Nicolas Sarkozy said on Monday as global leaders gathered for a summit on nuclear security.
"I cannot jeopardize the security and safety of my country," Sarkozy told CBS News hours before US President Barack Obama opened the landmark summit of 47 nations in Washington.
The French leader said he could not abandon his nation's nuclear weapons program "on a unilateral basis, in a world as dangerous as the one in which we live today."
He also hinted that countries like the United States and Russia should take the lead in whittling down their own huge nuclear stockpiles, rather than expecting France, which has a much smaller number of atomic weapons, to disarm. "You have to realize, we're a country of 65 million inhabitants," he said.
"We have fewer conventional weapons than the US, than Russia, than China, for that matter.
"I have inherited the legacy of the efforts made by my predecessors to build up France as a nuclear power. And I could not give up nuclear weapons if I wasn't sure the world was a stable and safe place."
Obama's two-day summit will focus on obtaining a broad international commitment to keep loose fissile material as secure as possible, to prevent it from getting into the hands of extremists or rogue states.
Sarkozy also signaled his support for new UN sanctions against Iran, warning that Tehran's potential pursuit of a nuclear weapon is "dangerous and unacceptable."
"Patience has its limits and we have come to a time now where we need to vote sanctions..." he told CBS. But he stressed that any new sanctions against Tehran must not be so watered down by the UN Security Council that they end up having no impact on the leadership of the Islamic republic.
"The best solution is the unity of the Security Council," Sarkozy said. "But not at any price. Not at the price of a resolution that is so toothless that it would achieve nothing."
Sarkozy later attended a dinner with the other leaders, ahead of closed-door meetings on Tuesday.

Does Pakistan’s macroeconomic situation stable?

"The macro-economic situation of the country is a risk, but the conditions are improving under the IMF/WB supported programme. Energy sector's financial viability is a key to macro-economic stability and relevant policy measures which are part of the program. The second risk is that credible private investor may not be willing to take on the RROT for Genco -1. To mitigate the risk, much of the risks faced by the investors such as financing risk should be addressed by tapping financing from the IFIs to a large part, especially the non-sovereign type," said the Bank in its report sent to Secretary, Privatisation Commission.
The World Bank has portrayed Pakistan's macroeconomic situation as 'risky', but maintained that conditions are improving under an International Monetary Fund (IMF) and Bank-supported programme. The Bank made these comments on a draft concept note for a 'Rehabilitate, Operate and Transfer' (ROT) approach, which has been considered for genco-1 (Jamshoro and Kotri thermal power plants).
The report states that, essentially, what is being structured is an independent power producer (IPP) project. Given the long track record of Pakistan in realising private sector IPP, the institutional, legal and decision making framework largely exists. Accordingly, the Privatisation Commission and the Ministry of Water and Power (through the Private Power & Infrastructure Board (PPIB) and Pepco) would be responsible for the preparation.
Plans are to recruit transaction advisors comprising technical, financial and legal skills. These transaction advisors would be funded by the Bank's ongoing Electricity Distribution and Transmission Improvement Project (EDTIP). Recruitment of the transaction advisors is being initiated. The transaction advisors would carry out the preparation in two parallel tracks - first is to make the techno-economic assessment of Genco-1's plants, the gas availability, and define in functional terms the needs for reconstruction and rehabilitation and the length of the concession period. This assessment would include assessment of environmental and social issues as well. In parallel, the Transaction Advisors would initiate the selection of the possible investor(s).
This would include preparation of the financial assessment of the concession, the legal framework (including draft agreements) and pre-qualifications of the investors. The final bidding for the investor would be conducted once the techno-economic assessment as well as the commercial legal framework is ready. This process is expected to take roughly 12 months.
According to the Bank estimates, which are quite preliminary, reconstruction and rehabilitation of genco-1's plants would cost about $600 million--$400 million for the replacement of some units, and the remaining for rehabilitation
This possible financing plan does reflect the wishes of GoP to make it a PPP in which Pepco will hold 30 percent of the equity whereas the entire debt would be funded by international financial institutions, predominantly IFC and World Bank (IBRD), and other IFIs could also participate.
While the project preparation responsibilities would initially rest with the GoP and its entities, the Bank has recommended that concept clearance be secured immediately and all the legal and environmental and other permits, etc, be obtained by Genco-1, before participation by the private investor upon selection.
The Bank expects that with the help of the Transaction Advisors, the investor would be selected through a multi-stage international selection process. Accordingly, the expectations at the moment are that procurement would be as per guidelines noted in "Procurement under BOO/ BOT/ BOOT, Concessions and Similar Private Sector Arrangements".
Disbursements are expected to be along those in private sector projects - an agent bank (also known as an account bank) that would be appointed under specific agreement, would hold all the funds in escrow and release them upon meeting disbursement criteria being met.
Under the concession, Genco-l will be operated like a private company, and is expected to have appropriate accounting and financing management systems. The company will be subject to international standards audit.
The Bank is of the view that availability of natural gas should be immediately re-committed by the GoP. In view of the severe shortages of natural gas, pressures are being put on GoP to take away the gas from Genco-1 and give it to alternative uses (eg, fertiliser production).
To avoid these pressures, GoP should re-confirm immediately that the currently available gas would continue to be available to Genco-1. The Techno-Economic Assessment as part of the Transaction Advisory would carry out the due diligence to confirm for how many more years the gas would be available from the fields that are currently supplying, which would in turn determine the length of the concession, the Bank added.
This suggests that the GoP's focus should be on obtaining an investment commitment to reconstruct and rehabilitate Genco-1 as opposed to trying to generate funds for the budget by attempting to privatise the plant.
In view of the weak macro-economic situation, there are pressures to privatise possible state assets and Genco-l could be viewed as a possible candidate. However, in view of the current local and global conditions, outright sale may not be possible--as was proved by GoP's previous failed attempts to privatise Jamshoro and Kotri thermal power plants.
At the same time, failure to structure the reconstruct/rehabilitate transaction urgently would also negatively affect the power situation in the country especially since at least part of the asset base of Genco-1 is in bad condition and all of it is operating at low efficiencies which will only deteriorate with time.

Why women conceal their age

So simple, yet so complex; so weak, yet so powerful; so confusing, yet so confident; so damning, yet so lovable and in nutshell 'so elderly and, yet so young' - are known traits of women's life, the most tremendous object of the whole creation.The woman - 'the beauty' of the universe' has been visualized by the famous verse, "wajood e zun say hay kainat main rung". Adorned with all of the salient features, she has said to be as 'complex in nature', with the reasoning she by and large disliked to talk about her real age in the society.
The proof is evident from the fact that the person has to face the music who dares to call her as an 'Antie'. So to avoid any unfavorable consequences, one has to be contented by calling her 'miss' or madam, but remember 'not cross the limit'.
A legendary singer of Sub-continent was so touchy over the 'issue' that she, in her life time, had strictly forbidden her grand-children from calling her 'Nano' (grandmother), even did not allow them to come in front of her when she was among masses or in a singing concert.
She demonstrated the real practice of this 'worldly wisdom' by going to the extent that wrong information was given in the Identity Card as she did not want to disclose that her illustrious mother had grown up daughter- a reference to her ageing mother.
The problem is not restricted with the celebrities only; it has also influenced the common folk. In some societies, women are also witnessed to reduce the risk of 'exposing' by placing their off springs away in the public. If the 'sad incident' occurred, they didn't refuse to recognize them but just be contented in calling the child as 'nephew or niece'. That's all.
The best way to defeat the complexity, is going to the Parlour, to hide the "manufacturing faults" through laser therapy or other modern techniques. 'Best ever' beauticians always ensure them to bring them in 'normal life' after 2, 3 visits (sittings), like a look of a model.
Such age complex pinches, particularly pretty the women who seek eternal beauty , who want to take advantage of their good looks and exploit the emotions of opposite sex for succeeding in life.
So, they fear that any wrinkle appearing on their face may eclipse their beauty in the sense that their chances of succeeding in life would diminish.
Women should know that no one can defeat time, nor save themselves from its implications which makes them aged but experienced persons. They should understand that every age has its own beauty, charm and grace.
Let's have a look on celebrities. Marilyn Monroe, an American actress, singer had committed suicide in a fear of getting older, it is said. Lady Diana, Princess of Wales, used to take pills of vitamin C in the early age of 30, to become more fresh and avoid wrinkles on her face.
This is not a phenomenon of West as the 'age phobia' also did not spare the actresses of Sub-continent. "Should I tell clearly about my age, well, It is 23" surprised Pakistani film actress, Noor while replying a question.
Those actresses always agree to disagree over their age to the media, particularly. Ironically, they used to make register wrong age in their Identity Cards even, declaring it a 'severe mistake of their parents' when they were born.
A leading film actress associated with a well-known film director for last 15 years claims that she is still in early twenties. "Most of the actresses hide their age, which is a bad practice.I do not believe in such things. Look I am 21, why should I hide my age then", said the ageing beauty in an interview with a national daily.
While talking on the issue, Moniba, a local journalist said, "Why you blame the women only, men too try to hide their age". However, the irritated Journalist just cooled down by saying "it's natural phenomenon of human beings because every woman wants to overcome her inferiority complex so naturally she tries to avoid disclosing her real age - to gain more importance in the society perhaps".
Maryyam, another journalist working for a TV channel said women do this not by choice but by compulsion. The reason being, no woman likes to appear older and loose people's attention, especially when looking for her life partner or getting promotion at work field.
A psychologist, Hameed Khan while commenting said, almost same feelings found on the part of men but they some what remain lesser conscious as compared to women. "Perhaps in this hypocritic society, they have to face fewer problems than the fair sex."
In short both men and women have to be prepared to deal with the social stigmas and which are, sadly, particularly related to women in our society.

Pakistan hails US nuclear summit

Pakistan on Saturday hailed a nuclear security summit convened by US President Barack Obama saying it would help efforts on nuclear disarmament.
Obama's nuclear security summit next week will target the "gravest danger to America" -- plutonium and uranium stocks which extremists could use for full-scale nuclear bombs, officials said Friday.
The 47-nation-summit will seek national commitments to secure all nuclear materials within four years and is the biggest such gathering outside the UN on US soil since the 1945 San Francisco summit on forming the United Nations.
"I think it is a positive step in the right direction and Pakistan with other non-aligned countries has always been pursuing the long-term objective of nuclear disarmament," foreign ministry spokesman Abdul Basit told a briefing. "We hope that it is a step forward to achieve that objective and we welcome that."
Meanwhile Pakistani Prime Minister Yousuf Raza Gilani said that Pakistan's nuclear weapons were safe as he left for the United States to attend the summit.
"I assure the world, I assure the people of Pakistan that the nuclear capability, the nuclear programme is in safe hands," the Associated Press of Pakistan quoted Gilani as saying.
"The nuclear programme is in experienced hands and we have experience of over 30 years," said Gilani, who is also the chairman of the South Asian country's civil-military Nuclear Command Authority. The United States has longstanding concerns about proliferation from Pakistan.
Policymakers are said to have quietly drafted a crisis plan in case the nuclear arsenal risk falling out of the control of the government, which is fighting an insurgency by Taliban and Al-Qaeda linked militants in the north west of the country
Gilani is meeting Obama on Sunday, Basit said.
"We hope that this meeting between our prime minister and the president of the US will help accelerate the momentum of relations which was generated in Washington," he said.
The two nations last month wrapped up a first-of-a-kind "strategic dialogue," which the United States hopes will show Pakistan's widely anti-American public that it cares about the country beyond seeking help against Islamic extremists.

Delicate balance on India, Pakistan

President Barack Obama's drive to build relations with both India and Pakistan faces a delicate test Sunday as he meets with the leaders of the nuclear-armed rivals to discuss security issues.
Obama is expected to meet Prime Ministers Manmohan Singh of India and Yousuf Raza Gilani of Pakistan within hours, on the eve of a 47-nation summit on improving nuclear security.
But no meeting has been scheduled between Singh and Gilani. The two nations cautiously resumed talks in February which had been cut off after the deadly Mumbai assault in 2008.
Robert Blake, the assistant secretary of state for South Asia, said that the "pace, scope and character of relations" between India and Pakistan was up to the two countries.
But he added: "The United States hopes that India and Pakistan can improve relations between two friends of the United States."
Obama invited Singh in November for the first state dinner of his presidency, an honor meant to push forward a decade-old drive to transform the world's two largest democracies into partners.
The Obama administration has at the same time welcomed Pakistani actions against Islamic extremists and tried to curb widespread anti-Americanism in the country by seeking cooperation on issues beyond Afghanistan.
At a first-of-a-kind strategic dialogue with the United States last month, Pakistan presented one item on its wish-list: a US role in Kashmir, the divided Himalayan territory at the heart of two wars with India.
The United States has publicly ruled out mediation over Kashmir, which India considers a domestic issue. But some supporters of India have worried the Obama administration may put subtle pressure on New Delhi.
Edward Burrier, an adviser to Republican Congressman Ed Royce, said that the United States should devote its energy to fighting Lashkar-e-Taiba (LeT), the Islamist movement blamed for the Mumbai bloodbath.
"I'm sympathetic to the view that to reduce troop tensions on the India-Pakistan border, you can't leave Kashmir hanging out there forever," Burrier said.
"But it seems the best way to reduce tensions between the two is pressing on Pakistan to permanently arrest the LeT's leadership and to crack down on the organization, not lean on New Delhi," Burrier said.
Blake said he encouraged Pakistan to crack down on Lashkar-e-Taiba during a visit in March, while praising the government's actions against Islamic militants elsewhere.
Media in both India and Pakistan both routinely charge that the United States is slanted toward the other country.
Indian commentators have recently voiced outrage that US prosecutors reached a plea deal with David Headley, who surveyed targets in Mumbai before the siege that left 166 people dead.
Under the deal, Headley -- the US-born son of a former Pakistani diplomat and an American woman -- agreed to cooperate with US investigators in return for avoiding the death penalty and extradition to India.
Teresita Schaffer, director of the South Asia program at the Center for Strategic and International Studies think-tank, said the United States largely had different interests in India and Pakistan.
Since the late 1990s, "the US is much better able to insulate its policies towards India from those towards Pakistan," she said.
"But it's not 100 percent. In any two countries that have that pronounced a rivalry, there's going to be some concern in each country based on how you deal with the other," she said.
India and Pakistan, however, are both seen as crucial to the theme of Obama's summit -- preventing an attack from loose nuclear materials.
The South Asian nations gate-crashed the elite club of nuclear powers in 1998. While the United States has since praised India's nuclear security and pursued cooperation, it has feared proliferation from Pakistan.
"Pakistan has been a source of concern in the past," State Department spokesman Philip Crowley said. "But if we're going to strengthen the nonproliferation regime going forward, we want to see Pakistan invested in this process."
The Washington Post reported late Saturday that the Pakistani intelligence service had set free at least two senior Afghan Taliban militants even as it helped the United States detain Taliban's second-ranking commander in the area, Mullah Abdul Ghani Baradar.
Meanwhile, premier Gilani said that Pakistan's nuclear weapons were safe as he left for the United States to attend the summit.
"I assure the world, I assure the people of Pakistan that the nuclear capability, the nuclear program is in safe hands," the Associated Press of Pakistan quoted Gilani as saying.

Cheapest in Asia, May advance 23pc by year-end

Pakistan's stocks, the cheapest in Asia, may advance by 23 percent in the next eight months, buoyed by overseas funds and improved company earnings, according to National Investment Trust Ltd. "All the fundamentals indicate that the market will pare most of its losses of the past two years" and reach 13,000 by end-December, Manzoor Ahmed, who manages the equivalent of $857 million as head of asset management at state-owned National Investment, Pakistan's largest equity fund, said in an interview yesterday. "The economy is in a good recovery phase."
Pakistan's benchmark Karachi Stock Exchange 100 Index trades at 8.75 times future earnings, the lowest in Asia, according to Bloomberg data. A Taliban guerilla offensive has killed hundreds in a nation that's been ruled by the army for half of its existence since 1947, when it gained independence.
The KSE100 rose 0.5 percent to 10,589.26 as of 12:13 p.m. in Karachi, from yesterday's close of 10,533.57. Still, its 41 percent lower than its record in April 2008.
Oil companies, power generators and lenders may lead gains in Pakistan's stocks this year, said Ahmed, without naming any.
The KSE100 index sank as much as 69 percent from its peak after the Karachi Stock Exchange restricted trading for four months from August 2008 to prop share prices up.
The gauge has climbed 13 percent this year, extending last year's 60 percent advance as overseas investors bought more equities in South Asia's second-largest economy. Gross domestic product may grow 3.4 percent in the financial year ending June 30, after a 2 percent gain in the previous year, according to the Finance Ministry.
Inflation, Politics
Stock gains may be limited if accelerating inflation prompts the central bank to raise borrowing costs, while a struggle between the nation's top politicians, President Asif Ali Zardari and opposition leader Nawaz Sharif, a former prime minister, may limit the government's ability to implement policies aimed at buoying the economy, Ahmed said.
Foreign investors bought net $176.6 million of Pakistan stocks between Jan. 1 and April 8, after selling a net $237.4 million in the same period last year, according to stock exchange's National Clearing Company of Pakistan Ltd.
The KSE100 Index plunged 58 percent in 2008, its first annual decline since 2001. Pakistan needs to expand at an average 6 percent pace over the next five years to cut poverty, according to the government.