May 27, 1998
The World Bank has postponed an 865 million dollar loan package to India
as an immediate reaction to the Pokhran Nuclear Tests. The postponed loan
package includes three World Bank loans and a ten million dollar loan from
the International Finance Corporation. The World Bank package comprises
130 million dollars package for a renewable energy programme, a 450 million
dollar loan to develop a power-grid and a 275 million dollar loan to improve
the highway network in Haryana. Two of these loans were to be voted at
the Board of Governors meeting in Washington on May 26. But sources said
several executive Directors went by the US request and wanted more time
to consider the matter. The actual impact of the postponement on India
would be about 50 to 100 million dollars a year. The World Bank has not
specified when these loans would again be put up before the board.
On Monday, the European Union had also criticised the nuclear tests
and said it would attempt to delay the World Bank loans to New Delhi. India
has reacted strongly to the European Union's condemnation. A press release
issued by the external affairs ministry yesterday said, the country's policies
are determined by its national interests and any suggestions that India
should conform to an international regime or face economic consequences
Canada says India has damaged its chances of getting a
permanent seat on the UN Security Council by conducting the nuclear tests.
The Canadian Foreign Minister, Mr. Lloyd Axworthy told a Parliamentary
Committee in Ottawa that the International Community has to show its rejection
of the acquisition of nuclear weapons by a country for the purpose of elevating
The fallout of the Pokhran tests will dominate the proceedings
of the two month long budget session of Parliament beginning on May 27.
Prime Minister Atal Behari Vajpayee will make a statement on the issue
in the Lok Sabha immediately after question hour. Both the Houses will
debate the statement for two days and the Prime Minister will give his
reply tomorrow. The debate will be telecast live on Doordarshan. Among
the important legislations likely to figure during the session are the
Lokpal Bill, the Electricity Bill to replace the recent Ordinance and the
Bill for the creation of new States of Chhatisgarh, Vananchal and Uttaranchal.
The election to the post of the Deputy Speaker of the Lok Sabha is also
scheduled during the session. The Railway Budget will be presented on Friday
and will be preceded by a status paper on the Railways. Tomorrow, the economic
survey for 1997 will be presented while the General Budget for 1998-99
is to be presented by the Finance Minister, Mr. Yashwant Sinha on Monday.
All India Radio correspondent says, though the Centre has tried to convince
the opposition about the compulsions for the nuclear tests, political parties
particularly the Congress and the left will adopt an aggressive posture
as they fear that the BJP will try to take political mileage out of the
The Cabinet on 26 May approved an amendment to the Explosives Act providing
for stringent punishment including the death sentence for possessing sophisticated
explosives. This amendment will also be brought in the budget session.
The Cabinet Committee on Foreign Investments has cleared
six major projects amounting to fifteen thousand crore rupees. An official
spokesman said in New Delhi that the Committee approved the expansion of
Mangalore refineries to nine million tonnes and setting up of an Oil Refinery
at Vadinar in Gujrat. Among the other projects approved, is the 6,300 crore
rupee Cuddalore Thermal Power Plant in Tamil Nadu, which will use imported
coal from Indonesia, Malaysia and Australia as fuel.
The Jammu and Kashmir Chief Minister, Dr. Farooq Abdullah has urged
the world community to take note of the increasing barbarity of crimes
being perpetrated by Pakistan trained militants in the State. Talking to
the visiting Ambassadors of Belgium and Finland in Srinagar on 26 May,
he said, even mourners at a victim's funeral were not spared. Calling Pakistan
the mother of all terrorism in the world, Dr. Abdullah said influential
countries must put sanctions against Pakistan instead of helping it.
According to the American Cable News Network, Pakistan
has completed preparations for a nuclear test. CNN says Islamabad could
conduct a nuclear test in a matter of hours if it decides to go ahead.
US officials have, on the basis of satellite intelligence, also alerted
policy makers that Islamabad is close to being ready to test a nuclear
device. However, News Agencies report that no confirmation is immediately
available about this from Islamabad.
Meanwhile, Qatar and Oman have decided to join Pakistan in its protest
over India's nuclear tests. The messages offering support were delivered
to Prime Minister Nawaz Sharief by special envoys on 26 May.
The country continues to reel under intense heatwave conditions
with the national capital recording the hottest day in May in the last
fifty years on May 26. The mercury touched 46.2 degree celsius in Delhi,
5-degrees above normal. Dholpur in Rajasthan was the hottest place in the
country with a maximum temperature of 49.5 degree celsius on may 26.
The President, the Vice-President and the Prime Minister
on May 26, led the nation in paying homage to Pandit Jawaharlal Nehru on
his 34th death anniversary. They visited Shantivan in New Delhi this morning
and paid floral tributes at the samadhi of Pandit Nehru.
The Congress President, Mrs. Sonia Gandhi visited the samadhi and paid
her tributes. A special prayer meeting was held on this occasion.
The Defence Minister Mr. George Fernandes has supported
the idea of inducting nuclear weapons in the Indian Armed Forces. In a
television interview he said without weaponisation the whole question of
being a nuclear weapons state does not make any sense. He said nuclear
weaponisation is necessary as well as inevitable. Asked whether this meant
that Indian missiles will now be equipped with nuclear warheads the Defence
Minister said this is precisely what nuclear weaponisation means. Mr. Fernandes
said the government decision to impose unilateral moratorium on further
nuclear testing will not affect the weaponisation programme. Stating that
no time frame has been set as of now to complete the programme.
The Congress President Mrs. Sonia Gandhi has charged the
government with not taking the country into confidence on the deterioration
of the security environment which warranted nuclear tests. Talking to newspersons
in New Delhi she alleged that the government lacks transparency as its
ministers are making different statements on the issue. Earlier she addressed
the general body of the Congress Parliamentary Party which met in New Delhi
to prepare its game plan for the budget session.
The Prime Minister has indicated some policy changes in
accordance with the national agenda adopted by the BJP and its allies in
the government. Addressing the meeting of the BJP Parliamentary Party in
New Delhi, Mr. Atal Behari Vajpayee said his government approachs the first
budget session with a sense of achievement and pride. He said the issue
to undertake nuclear tests was being discussed for a long time and his
government has taken a decision as it is a part of the national agenda.
The Prime Minister also said that the increase in procurement price
of wheat has helped the farmers and resulted in record procurement. Mr.
Vajpayee said the raising of retirement age by two years will in no way
harm the interests of unemployed youth as the recruitment age has also
been raised by the same period.
The Commerce Minister Mr. Ramakrishna Hegde told a Conference
of Indian Commercial Representatives in London that the key growth sectors
for exports will be identified. Mr. Hegde said the missions should also
keep a data bank of importers to maintain close liaison with customers
and visa restrictions for professionals from India must be relaxed. He
said fighting the restrictive trade practices by the developed countries
whouse anti-dumping and anti-subsidy measures to check Indian exports have
to be tackled by the commercial representatives.
The Rupee closed at 41.15 against the US dollar down from 40.96 of May