Khushwant Toor writes from Toronto

CANADIAN Finance Minster Mr. Tony Clement on December 13, 2008 announced that, Canadian Federal as well as the Ontario government is willing to give the Canadian automakers roughly $3.4 billion in emergency aid to keep them rolling – but only if the American government passes its bail out plan for the troubled automakers. The aid is also conditional on restructuring plans by the Canadian subsidiaries of General Motors, Ford and Chrysler.

The $3.4 billion figure is equivalent to Canadian share of the North American auto production based on the $14 billion current American proposal of providing cash to the big three to keep them going. The Canadian automakers, on the other hand are seeking up to $6.8 billion in emergency and long-term aid to cope with plunging sales and to restructure.

The Finance Minster also said “It's absolutely not a blank cheque ... we have to protect the interests of the taxpayers. This is about conditional support based on their long-term plans, based on them working with the parts suppliers, based on the unions being at the table, based on the United States continuing to be part of the solution."

However, last Thursday, Republicans in the U.S. Senate refused to pass an interim $14 billion (U.S.) rescue bill and blamed the auto workers union for not willing to contribute from their share during the current economic crisis. The auto workers are expected to get a wage cut as part of the plan for the bail out package.

Since the U.S. Senate’s refusal to pass the bail out package, all eyes have been on the U.S. president to help push the deal forward. The U.S. Senate is expected to debate on the issue again soon.

As far as the automakers are concerned, both GM and Chrysler say they need emergency cash before the year ends to stay alive. Ford does not have an immediate cash flow crisis and is looking for a government-backed line of credit for its future needs.

GM and Chrysler have indicated they will run out of cash to operate their U.S. and Canadian plants within weeks, which would also cripple hundreds of parts companies and stall production at other automakers that rely on them. If the GM and Chrysler plants are shut down, roughly about 400,000 jobs will be lost immediately. This would push the U.S. and Canadian economies into a deeper recession.

Lack of government backed financial aid could also force one or more automakers and many suppliers into temporary court protection from creditors, creating a crisis in consumer confidence that would eventually lead to their demise.

The future of the North American auto industry is very dicey and would depend on how fast the American law makers pass a tentative bailout deal. A deal will sure come, however many autoworkers fear that it may be too late before they are laid off from work.

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Rise of Russia divides Europe

Sawraj Singh writes from Washington

RUSSIA continues its rise as a world power; Europe is facing a growing division between the old and the new Europe. The old Europe is led by the countries such as France, Germany and Italy which are very developed, stable and with strong democratic traditions. The new Europe consists of countries such as Poland, Czech Republic, Georgia, Ukraine and Romania which are poor, unstable and without any strong democratic traditions. These countries are poorer and less developed than many third world countries and are in a unique category that can be most appropriately called the “Fourth World”.

The poor less developed and unstable Europe is led by the USA and the UK. As opposed to the third world countries, many of the fourth World European countries are most reactionary, anti communist, antisocialist and they align with the USA and the UK against the third world countries, Russia, China and the Islamic countries. Instead of joining the movement to bring a change in the World order and the outdated financial global institutions, these countries want to maintain the hegemony of the USA and the unipolar world.

However, the old and stable Europe wants a change from the unipolar world to a multipolar world and wants to reach an understanding with Russia. They understand that without compromises with Russia, Europe and the World can never be stable and peaceful.

Another conflict the fourth world countries of Europe are facing with the third world countries is on the issue of immigration. The poor and destitute Europeans from these countries want to migrate to the well off countries of Europe and compete with the people of the third world countries for the low paying and menial jobs. Whereas, many third world countries have improved job opportunities and some of them are even experiencing reverse migration, the fourth world countries of Europe show no sign of improvement and their economies are going from bad to worse. Last year, I saw many people from these countries doing jobs in England which were generally done by the people from the third world countries.

The developed Europe can clearly see the trends that the Russian power in the world is rising and he American influence is declining. America can no longer maintain the only Super Power status in the world. Russia is engaged in naval exercises in South America, upgrading its missile system and installing new missiles system right next to Poland and the Czech Republic.

The old Europe does not want to provoke a powerful Russia whose power it can not meet but the new Europe has unrealistic faith in the American power and keeps teasing and provoking Russia. Even the severe beating received by Georgia did not convince it that America may not risk a confrontation with Russia on its behalf. Both Poland and the Czech Republic are going ahead with the installation of the American missile system in their countries.

However, the old Europe has resisted the American pressure and continues to improve its relations with Russia. It does not want to risk its energy supply from Russia. The new gas pipeline will bypass Poland. Russia and Germany in their summit have decided a new route for the pipeline by passing Poland. The old divisions in Europe will be replaced by the new divisions, the countries such as France, Germany and Italy want to assert their independence from America, and the new Europe wants to perpetuate the American domination.

[Sawraj Singh, M.D. FICS is Chairman Washington State Network for Human Rights]

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Even after 26/11 tourism in Punjab is unlikely to take a nosedive

Harjap Singh Aujla

I have seen reports that as an aftermath of the horrific tragedies of 26/11 in Bombay, foreign tourism has gone down drastically in Bombay and several other parts of India. That is perfectly understandable. Even the evergreen tourist destination of Goa is feeling the heat. Reports originating from New Delhi have also indicated that even the number of budget tourists staying in low rent hotels of Pahar Ganj has gone down to mere 20% compared to last year’s record figures. Shockwaves have not spared even Agra and Jaipur. Business class seat bookings in the airlines flying to India have gone down significantly. This is how the economies of nations start taking a turn for the worse.

I have talked to some of the Punjabi diaspora in Canada and the United States. They are shocked by the man inflicted tragedies of Bombay, but none of them has cancelled the bookings for travel to Punjab. Of course cancellation of flights from Amritsar by Jet Airways is going to impact the numbers of arrivals and departures from this airport, but the volume of passengers traveling to Punjab is not going to decrease. They may be forced to land in New Delhi by coercion, but their trips to their destinations in Doaba, Majha and Moga are not going to drop.

I think the top management of Jet Airways has committed a colossal blunder by discontinuing services from Amritsar International Airport. There may be a paucity of business class travelers from this airport, but the economy class has been running packed to capacity. This prestigious five star airline should have been more flexible and sensitive to the sentiments of the Punjabi dispora. They had the option of increasing the size of the economy class and decreasing the number of seats in the business class for their planes operating from Amritsar and Ahmedabad. During these troubled times every airline, big or small, is cutting corners. They all know that the business class is shrinking all over the World. Most of the big international carriers are modifying their plans for meeting the challenges of a recession. Jet Airways must understand that the period from 31st of October to 31st of March is the peak season of NRI travel to Amritsar and the rest of Punjab. By suddenly discontinuing their high occupancy services from Punjab’s only international airport, they are shooting themselves in the foot. It is public relations blunder. Many travelers are thinking of boycotting Jet Airways.

Singapore Airlines have instead taken a wiser and financially correct decision. They have served the notice of terminating their services with effect from February 1, 2009. By doing so they have given enough time to the Government of India to amend their policies to make the landing charges more reasonable for Amritsar International Airport. The business savvy Singapore Airlines knows it rather well that Amritsar is giving a lot of long distance travel business to them. Amritsar has made their flights from Singapore to Vancouver, Sydney, San Francisco and Los Angeles economically more viable. Singapore has become the hub of air travelers between Amritsar and the destinations in North America’s West Coast and Australian and South East Asian destinations.

On the contrary, the attitude of Jet Airways smacks of corporate arrogance of the worst order. Jet Airways should have waited for the outcome of the meetings and action on the decisions taken in the Manohar Singh Gill led committee appointed by the Indian Minister of Civil Aviation. Their undue haste in shunning Amritsar International Airport is raising serious suspicions about their real intentions.

Amritsar international Airport has a great future. This airport has yet to receive its first direct flights from Vancouver, San Francisco and Sydney. When that happens, it will become India’s sixth busiest airport for foreign travel.

The fact remains that the Punjabi NRIs are unperturbed by the World Recession and the ghastly tragedies of 26/11. This winter also they are again thronging in ever increasing numbers to their old hometowns and villages. The affluent NRI community is the backbone of the economies of the Doaba region and Moga and Ludhiana districts of Malwa region. They are helping the economy of Punjab Government tremendously by contributing significantly to the VAT receipts.

harjapaujla@gmail.com

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