USA
Law on healthcare passed
On March 23, 2010, US President Barack Obama signed into law the landmark Health Care Bill that introduces sweeping reforms in the USA’s healthcare system, capping a historic legislative victory that had eluded several of his predecessors. It will take four years to implement fully many of the reforms.
Obama said that henceforth insurance companies will no longer be able to drop people's coverage, when they get sick or they won't be able to place lifetime limits or restrictive annual limits on the amount of care they can receive.
The President said once this reform is implemented, health insurance exchanges will be created, a competitive marketplace, where uninsured people and small businesses will finally be able to purchase affordable quality insurance.
Obama said this legislation will also lower costs for families and for businesses and for the federal government, reducing deficit by over $1 trillion in the next two decades.
WORLD ECONOMY
IMF paints grim picture of fiscal tightening needs
Developed countries with big budget deficits must start now to prepare public opinion for the belt-tightening that will be needed starting 2011, says John Lipsky, the International Monetary Fund’s first deputy managing director. He added that the scale of the adjustment required was so vast that it would have to come through less-generous health and pension benefits, spending cuts and increased tax revenues.
Policy-makers should already be making it clear to their citizens why a return to prudent policies is a necessary condition for sustained economic health, Lipsky said.
The IMF estimates that, by raising real interest rates, maintaining public debt at its post-crisis levels could reduce potential growth in advanced economies by as much as half a percentage point annually.
Second, fiscal institutions must be strengthened to withstand adjustment fatigue. Options include reinforcing fiscal responsibility legislation and improving tax collection.
Third, entitlement reforms such as increases in the retirement age would have favourable long-term fiscal effects but do little near-term damage to aggregate demand.
RBI to buy IMF notes worth $10 bn
The Reserve Bank of India (RBI) has signed an agreement with the International Monetary Fund (IMF) to purchase notes worth up to $10 billion to improve the ability of the international lender to provide timely and effective balance-of-payment assistance to member countries. IMF will issue the notes in the special drawing rights (SDR)-denominated form. The pact is a temporary bilateral arrangement for one year, which might be extended to two years.
The pact is part of the international effort to support IMF’s lending capacity following the decision of the Group of 20 nations at its London Summit (held in April 2009) to treble IMF’s resources to $750 billion.
Generally, IMF will give a five-day notice to RBI about its intention to issues notes, including the amount. It will restrict issuance to a principal amount not exceeding SDR 500 million in any calendar week.
At the beginning of each quarter, IMF will also provide estimates for the amount for which notes will be issued during a three-month period.
Permanent increases in IMF’s resources are expected to take place through an increase in quotas and standing borrowing arrangements currently under negotiation.
ENVIRONMENT
India and China Okay Copenhagen Pact
On March 9, 2010, India and China formally backed the Climate Change Accord hammered out in Copenhagen in 2009, calling for voluntary cut in greenhouse gas emissions. Both the countries submitted official letters to the UN Climate Change Secretariat saying that they agreed to being listed in the preamble of the Accord, subject to certain conditions.
India made it clear, however, that the accord is a political document and not a legally binding one.
INTERNATIONAL RELATIONS
Google leaves China
Late on March 23, 2010 night, the Internet giant Google shut its Chinese website and shifted its search engine services to uncensored Hong Kong after two months of confrontation with Beijing over censorship and alleged hacking attacks. But those re-routed to Hong Kong still couldn’t access sensitive websites as these were blocked by Chinese filters.
Google’s bold censure of the business environment in the world’s number three economy—and the biggest online market of 384 million netizens— had left the fate of its future China operations in doubt.
Soon after Google’s announcement, Beijing lashed out by calling the action “totally wrong” and saying it “violated the written promise” it made four years ago, when it arrived, promising to self-censor online services as required by Chinese law.
Chinese Foreign Ministry spokesman Qin Gang said the exit would not affect Sino-US relations unless someone politicised the issue.
China believes its citizens need strict censorship. It blocked YouTube after the Tibet riots in March 2008, fearing the spread of mass unrest through the Internet. Facebook and Twitter were blocked after the Xinjiang riots in July 2009.
US President Obama’s visit to Afghanistan
On March 28, 2010 US President Barak Obama sneaked into Afghanistan under the cover of darkness, to avoid being targeted by militants. This was his first visit to the country since taking office. For security reasons, the trip was cloaked in secrecy.
Obama met Afghan President Karzai in the palace’s outdoor grounds and stood under a pavilion for a brief welcoming ceremony. The President spent roughly six hours in the country.
During their meeting the Afghan leader was invited to the White House on May 12, 2010. Mr Obama also tackled Mr Karzai on his failure to make any meaningful reforms since he narrowly won a second term in fraud-ridden polls in 2009.
Mr Karzai made grandiose promises in his inauguration speech but so far he has failed to deliver. At the time, US officials said he had six months to reform or risk losing American support.
Mr Obama also addressed 2,500 US troops at Bagram air force base, nine miles from Kabul. He praised them for their courage, sacrifice and focus, and warned of tough days ahead.
US, Russia seal N-arms cut deal
US President Barack Obama and Russian President Dmitry Medvedev sealed a landmark arms-control treaty on March 28, 2010 to slash their countries’ nuclear arsenals by a third.
After months of deadlock and delay, a breakthrough deal on a replacement for the Cold War-era START pact marked Obama’s most significant foreign policy achievement since taking office and also bolsters his effort to “reset” ties with Moscow.
Russia made clear, however, that it reserved the right to suspend any strategic arms cuts if it felt threatened by future US deployment of a proposed Europe-based missile defence system that Moscow bitterly opposes.
The agreement replaces a 1991 pact that expired in December 2009. Each side would have seven years after the treaty takes effect to reduce stockpiles of their most dangerous weapons—those already deployed—to 1,550, from the 2,200 now allowed, and also cut their numbers of launchers to half.
INTERNATIONAL TERRORISM
Chechen insurgency re-surfaces in Russia
During the six years since the last suicide bomb attack on the Moscow subway, Muscovites came to think of themselves as insulated from the guerrilla warfare. Terror, however, returned to the heart of Russia on March 30, 2010, with two deadly suicide bombings on the Moscow subway at rush hour, including an attack at the station beneath the headquarters of the secret police. At least 40 people were killed and more than 60 wounded in the blasts.
Russian police had killed several Islamic militant leaders in the North Caucasus recently, which raised fears of retaliatory strikes and escalating bloodshed by the militants. The bombings showed that the beleaguered rebels are still strong enough to inflict harm on an increasingly assertive Russia, and they followed a warning in February 2010 from Chechen rebel leader Doku Umarov that “the war is coming to their cities.”
Prime Minister Vladimir Putin, who built much of his political capital by directing a fierce war against Chechen separatists a decade ago, promised to track down and kill the organizers of what he called a “disgusting” crime.
Headley pleads guilty to all 12 charges
In a volte-face, Pakistani-American LeT operative David Coleman Headley, accused of plotting the 26/11 Mumbai terror attacks and conspiring to target a Danish newspaper, has pleaded guilty before a US court. Charged on 12 counts, he admitted guilty in all of them.
Headley (49), who was arrested by FBI's joint terrorism task force on October 3, 2009, told US District Judge Harry Leinenweber that he wanted to change his plea to guilty, in an apparent bid to get a lighter sentence than the maximum death penalty.
Headley, son of a Pakistani diplomat and a Philadelphia socialite, admitted to using his friend Tahawwur Rana's immigration company as a cover for surveillance activities in India and Denmark on behalf of Pakistan-based terrorist groups, including LeT.
Headley admitted guilty in all six counts of conspiracy involving bombing public places in India, murdering and maiming persons in India and providing material support to foreign terrorist plots and LeT; and six counts of aiding and abetting the murder of US citizens in India.
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