Analysis: Modi's Gujarat growth model might not work across India

SURAT, India (Reuters) - Turning a single Indian state with a long tradition of entrepreneurship and a solid political majority into an investor-friendly economic powerhouse is one thing.

Replicating that experience across a diverse country of 1.2 billion would be a tougher prospect for Narendra Modi, whose leadership of booming Gujarat state has led to his being touted as a potential candidate to become India's next prime minister.

While Modi wins praise even from critics for cutting red tape and making government more responsive and predictable, many ingredients for Gujarat's run of growth were in place well before he took office in 2001.

"It is like an icing on cake sort of thing. You have a nice cake and Modi has done a lot of good icing," said Rakesh Chaudhary, director of Pratibha Group, a textile manufacturer in Palsana on the outskirts of the Gujarat city of Surat.

Industry in Gujarat is helped by a long coastline and plenty of barren land that is easy to turn over to factory use.

The power that comes from a long-standing and heavy majority for his Bharatiya Janata Party (BJP) in the state also gives Modi an advantage that he would not enjoy on a national stage marked by fractious coalition politics.

Despite a controversial past - Modi is accused by critics of not doing enough to stop or of even quietly encouraging religious riots in 2002 that saw as many as 2,000 killed, most of them Muslims - he has established a reputation as an economic reformer in part by building on the strengths of Gujarat and marketing them heavily.

Modi's marketing savvy, aided by the Washington lobbying and public affairs firm APCO Worldwide, will be on display at the biennial "Vibrant Gujarat Summit" that begins on Friday.

Initiated by Modi in 2003 to attract investment after the violence and an earthquake in 2001, the event is attended by thousands of corporate officials who pledge billions in investment, although in reality only a fraction has seen the light of day. Of 12.4 trillion rupees ($225 billion) in investment proposed at the 2009 event, just 8.5 percent had been spent as of November 2011, according to state government data.

"Under Modi's regime, there has been significant improvement in infrastructure growth, significant improvement in industrialization, as well as agriculture," said Jahangir Aziz, senior Asia economist at JPMorgan. "But what has been overplayed is initial conditions were actually pretty decent in Gujarat."

HIGHER OFFICE?

The stocky Modi, who favors traditional Indian attire and a clipped white beard, plays down any prime ministerial ambitions.

But his popularity in Gujarat - the BJP won 115 of the state assembly's 182 seats in a December election - has fuelled speculation that he could lead his Hindu nationalist party in 2014 against India's ruling Congress party, which has been beset by corruption scandals and overseen a sharp economic slowdown.

"His economic record in Gujarat is obviously something which matters a lot to the middle classes. That, coupled with strong leadership," said Swapan Dasgupta, an analyst with links to the BJP who expects Modi to be the party standard-bearer in 2014.

Critics say that while Modi has indeed encouraged investment and helped bring reliable electricity and law and order, double-digit growth has not been shared broadly enough. In the five years through March 2010, some states - including Tamil Nadu and Karnataka - did better at bringing down poverty levels.

"Big business people get a lot from the government and scheduled caste people (minorities) get a lot, but people like us who are in between get nothing," said Bhupendra Thakkar, 50, who earns 6,000 rupees ($109) a month selling fruit near Surat's decrepit railway station.

FRIEND OF BUSINESS

Modi lured Tata Motors to the state in 2008 after the company's plans to build a factory for its low-cost Nano car were thwarted by farmers in West Bengal.

Ford Motor Co and Maruti Suzuki are also building plants in the western state - high profile investments that carry the added benefit of acting as marketing tools.

In the seven years through March 2011, Gujarat's economy grew an annual 10.08 percent at constant prices, against 6.45 percent in the eight years through March 2002 (Modi took office in October 2001), which was still ahead of the all-India average of 6.16 percent. A handful of states, including Maharashtra and Tamil Nadu, clocked bigger gains over the same recent period.

By comparison, policy gridlock at the national level has contributed to a drop-off in corporate investment, putting India on track to record its slowest annual growth rate in a decade.

Accustomed to getting his way, Modi, 62, could struggle to negotiate the coalition politics that have become the norm at the national level and have hindered attempts at reform by Prime Minister Manmohan Singh's Congress-led administration.

"Policymaking has benefited from the fact that the BJP has had absolute majority in the state legislature - an advantage it certainly will not enjoy in the federal parliament," said Anjalika Bardalai, an analyst with the Eurasia Group in London.

Modi has also been able to leverage the business acumen of Gujaratis, a group that has long been known for trading and entrepreneurship and includes a prosperous global diaspora as well as billionaires such as Adani Group chief Gautam Adani and Mukesh Ambani, who controls Reliance Industries, India's most valuable company.

"Modi might not be as successful as he has been here because the business mentality is unique to Gujarat," said Chandrakant Sanghavi, chairman of Sanghavi Exports International, a diamond trader and processor. "It could be prevalent in other states but the ratio may be less." ($1 = 55.0700 Indian rupees)

(Editing by John Chalmers and Alex Richardson)

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I 'liked' NUS law professor 'as a friend' at that time: Ex-student

SINGAPORE: The National University of Singapore law student at the centre of the sex-for-grades corruption trial was the first witness who took to the stand on Thursday morning.

Ms Darrine Ko told the court that she knew law don, Associate Professor Tey Tsun Hang, well and this was the reason why she bought a Mont Blanc pen worth S$740 and gave it to him.

She said that it was a "belated birthday present" and she "liked" Mr Tey "as a friend" during that time.

Associate Professor Tey, a former District Judge, has been charged with six counts of obtaining gratification from his student between May 2010 and June 2010.

As his trial began on Thursday morning, Associate Professor Tey, 41, sought to conduct his own defence but was rejected by Chief District Judge Tan Siong Thye.

Instead, the judge ordered defence counsel Peter Low to assist Associate Professor Tey in the trial, but not conduct the cross-examinations.

The Prosecution has lined up 14 witnesses for its case.

The trial continues later on Thursday.

- CNA/fa

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Google's Schmidt presses North Korean officials for open Web

Google's Eric Schmidt (right) upon his arrival in North Korea earlier this week with former N.M. Gov. Bill Richardson.

(Credit:
CBS News/Screenshot by CNET)

Eric Schmidt wrapped up a controversial visit to North Korea on Thursday, saying that his private delegation warned officials that global Internet access was key to developing its economy.

"As the world becomes increasingly connected, their decision to be virtually isolated is very much going to affect their view of the world," he told reporters upon his return to Beijing, according to a Wall Street Journal account. Lack of such access would "make it harder for them to catch up economically. We made that alternative very, very clear," he added.

Despite official U.S. opposition to the visit, Google's executive chairman flew to the reclusive nation on Monday as part of a delegation led by former New Mexico Gov. Bill Richardson, who described the trip as a "private humanitarian mission."

"We had a good opportunity to talk about expanding the Internet and cell phones in the DPRK," Richardson told the Associated Press before departing for Beijing.

The U.S. State Department had discouraged the visit, saying that the timing was not right for the delegation to visit the country, which is subject to U.S. economic sanctions. A department spokesperson cited recent missile launches by North Korea as a reason for opposing the visit

During the visit, the delegation, which also included Jared Cohen, head of Google Ideas, got a tour of a computer lab at Kim Il Sung University Pyongyang, where a student showed how he goes online to look at reading material from Cornell University.

It's unclear whether the delegation had the opportunity to inquire about Kenneth Bae, a Korean-American whose arrest on unspecified charges was announced by the North Koreans last month.

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New rules seek to shield consumers, mortgage lenders

WASHINGTON Federal regulators for the first time are laying out rules designed to ensure that mortgage borrowers can afford to repay the loans they take out.

The rules being unveiled Thursday by the Consumer Financial Protection Bureau impose a range of obligations and restrictions on lenders, including bans on the risky "interest-only" and "no documentation" loans that helped inflate the housing bubble.

Lenders will be required to verify and inspect borrowers' financial records. They generally will be prohibited from saddling borrowers with loan payments totaling 43 percent of the person's annual income.

CFPB Director Richard Cordray, in remarks prepared for an event Thursday, called the rules "the true essence of 'responsible lending."'

The rules, which take effect next year, aim to "make sure that people who work hard to buy their own home can be assured of not only greater consumer protections but also reasonable access to credit," he said.

Cordray noted that, in years leading up to the 2008 financial crisis, consumers could easily obtain mortgages that they could not afford to repay. In contrast, in subsequent years, banks tightened lending so much that few could qualify for a home loan.

The new rules seek out a middle ground by protecting consumers from bad loans while giving banks the legal assurances they need to increase lending, he said.

The mortgage-lending overhaul is a priority for the agency, which was created under the 2010 financial law known as the Dodd-Frank Act. The agency is charged with reducing the risk of a credit bubble by helping to ensure that borrowers are better informed and loans are more likely to be repaid.

The agency is charged with writing and enforcing rules that flesh out the law passed by Congress. Some provisions are required under the law, but the agency had broad discretion in designing many of the new requirements.

The rules limit features like teaser rates that adjust upwards and large "balloon payments" that must be made at the end of the loan period.

They include several exceptions aimed at ensuring a smooth phase-in and protecting access to credit for underserved groups. For example, the strict cap on how much debt consumers may take on will not apply immediately. Loans that meet separate federal standards also would be permitted for the first seven years.

Balloon payments would be allowed for certain small lenders that operate in rural or underserved communities, because other loans may not be available in those areas.

The bureau also proposed amendments that would exempt from the rules some loans made by community banks, credit unions and nonprofit lenders that work with low- and moderate-income consumers.

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Holmes 'Delighted' by Creepy Self-Portraits: Victims

After two days of apparent indifference, accused Aurora shooter James Holmessmiled and smirked at disturbing self-portraits and images of weapons shown in court today, according to the families of victims who watched him.

"When he sees himself, he gets very excited and his eyes crinkle," Caren Teves said outside of the courthouse, after the hearing. "Your eyes are the window to the soul and you could see that he was very delighted in seeing himself in that manner."

Teves' son Alex Teves, 24, died in the shooting.

Prosecutors showed photos that Holmes took of himself hours before he allegedly carried out a massacre at a Colorado movie theater. He took a series of menacing self-portraits with his dyed orange hair curling out of from under a black skull cap and his eyes covered with black contacts. In some of the photos, guns were visible.

Those haunting photographs, found on his iPhone, were shown in court today on the last day of a preliminary testimony that will lead to a decision on whether the case will go to trial. The hearing concluded without Holmes' defense calling any witnesses.

The judge's decision on whether the case will proceed to trial is expected on Friday.

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Holmes, 25, is accused of opening fire on a crowded movie theater in Aurora, Colo., on July 20, 2012, killing 12 people and wounding dozens others during a showing of "Dark Knight Rises."

The court room's set-up kept members of the media from being able to see Holmes' face as the photos were displayed, but victims and their families could watch him.

Teves said that Holmes was "absolutely smirking" when images of his weapons and the iPhone photos he took of himself were shown in court.

"I watched him intently," Caren Teves' husband Tom Teves said. "I watched him smile every time a weapon was discussed, every time they talked about his apartment and how he had it set up (with booby traps), and he could have gave a darn about the people, to be quite frank. But he's not crazy one bit. He's very, very cold. He's very, very calculated."

Holmes' has exhibited bizarre behavior after the shooting and while in custody. His defense team has said that he is mentally ill, but have not said if he will plead insanity.

"He has a brain set that no one here can understand and we want to call him crazy because we want to make that feel better in our society, but we have to accept the fact that there are evil people in our society that enjoy killing any type of living thing," a frustrated Tom Teves said. "That doesn't make them crazy. And don't pretend he's crazy. He's not crazy."

The photos presented in court showed Holmes mugging for his iPhone camera just hours before the shooting.

Click here for full coverage of the Aurora movie theater shooting.

Half-a-dozen photos showed Holmes with his clownish red-orange hair and black contact lenses giving the photos a particularly disturbing edge.

In one particularly odd image, he was making a scowling face with his tongue out. He was whistling in another photo. Holmes is smiling in his black contacts and flaming hair in yet another with the muzzle of one of his Glock pistols in the forefront.

Yet another photo showed him dressed in black tactical gear, posing with an AR-15 rifle.

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U.S. does not rule out removing all troops from Afghanistan

WASHINGTON (Reuters) - The Obama administration does not rule out a complete withdrawal of U.S. troops from Afghanistan after 2014, the White House said on Tuesday, just days before President Barack Obama is due to meet Afghan President Hamid Karzai.

The comments by U.S. Deputy National Security Adviser Ben Rhodes were the clearest signal yet that, despite initial recommendations by the top military commander in Afghanistan to keep as many as 15,000 troops in the country, Obama could opt to remove everyone, as happened in Iraq in 2011.

Asked about consideration of a so-called zero-option once the NATO combat mission ends at the end of 2014, Rhodes said: "That would be an option that we would consider."

Rhodes made clear that a decision on post-2014 troop levels is not expected for months and will be made based on two U.S. security objectives in Afghanistan - denying a safe haven to al Qaeda and ensuring Afghan forces are trained and equipped so that they, and not foreign forces, can secure the nation.

"There are, of course, many different ways of accomplishing those objectives, some of which might involve U.S. troops, some of which might not," Rhodes said, briefing reporters to preview Karzai's visit.

In Iraq, Obama decided to pull out all U.S. forces after failing in negotiations with the Iraqi government to secure immunity for any U.S. troops who would remain behind.

The Obama administration is also insisting on immunity for any U.S. troops that remain in Afghanistan, and that unsettled question will figure in this week's talks between Obama and Karzai and their aides.

"As we know from our Iraq experience, if there are no authorities granted by the sovereign state, then there's no room for a follow-on U.S. military mission," said Douglas Lute, special assistant to Obama for Afghanistan and Pakistan.

Jeffrey Dressler, an Afghanistan expert at the Washington-based Institute for the Study of War who favors keeping a larger presence in Afghanistan, questioned whether the White House comments might be part of a U.S. bargaining strategy with Kabul.

"I can't tell that they're doing that as a negotiating position ... or if it is a no-kidding option," Dressler said. "If you ask me, I don't see how zero troops is in the national security interest of the United States."

SHOULDN'T JUST "LEAVE THEM"

U.S. officials have said privately that the White House had asked for options to be developed for keeping between 3,000 and 9,000 troops in the country, a lower range than was put forward initially by General John Allen, the top U.S. and NATO commander in Afghanistan.

Allen suggested keeping between 6,000 and 15,000 troops in Afghanistan.

Retired General Stanley McChrystal, a former U.S. commander of the Afghan mission who resigned in 2010, said in an interview with Reuters on Monday there was a value to having an overt U.S. military presence in Afghanistan after 2014 - even if it wasn't large.

"The art, I would say, would be having the smallest number so that you give the impression that you are always there to help, but you're never there either as an unwelcome presence or an occupier - or any of the negatives that people might draw," he said, without commenting on any specific numbers.

The United States now has about 66,000 troops in Afghanistan and Rhodes confirmed there would be steady reductions in troop levels through 2014.

Also on the agenda for the Obama-Karzai talks are tentative reconciliation efforts involving Taliban insurgents. Those efforts have shown flickers of life after nearly 10 months of limbo.

Still, hopes for Afghan peace talks have been raised before, only to be dashed. Last March, the Taliban suspended months of quiet discussions with Washington aimed at getting the insurgents and the Karzai government to the peace table.

Washington has also had a strained relationship with Karzai, who in October accused the United States of playing a double game in his country by fighting the war in Afghan villages instead of going after those in Pakistan who support insurgents.

Karzai will give a joint press conference with Obama on Friday and will visit the Pentagon on Thursday, meeting with Defense Secretary Leon Panetta and the U.S. top military officer, General Martin Dempsey.

Still, it is unclear what, if any, concrete agreements might emerge from Karzai's visit to Washington.

Michael O'Hanlon, a defense analyst at Brookings, cautioned against expecting too much from the visit, which he said is best seen as an opportunity for Washington and Kabul to "shore up this partnership that has had such a troubled status and a weak foundation."

"There are a lot of scars in this relationship. There are a lot of hurt feelings," O'Hanlon said. "It's sort of like a bad marriage and it's very easy for just the wrong word to immediately set people off in an emotional way."

(Additional reporting by David Alexander.; Editing by Eric Beech and Christopher Wilson)

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Restaurant patrons relieve stress by smashing beer mugs

SINGAPORE: We're only just into the new year.

But if you're already stressed out and need some release - you might as well have a smashing good time while you're at it!

Over at District 10 restaurant at Star Vista, patrons have the option to booze... and lose some steam.

And without having to break the bank either!

A glass of beer goes for S$8 dollars - and once it's washed down - just step into the acrylic booth, take aim - and let go!

The restaurant is only offering beer mugs for now, but customers can order as many as they're game to smash.

About 300 mugs were prepared for Tuesday's launch.

And as anticipated, nearly all were reduced to smithereens!

If response is good, the restaurant says the event may extend beyond its initial three-month target.

You could say it's a pint-sized solution, that packs a punch - and you can even bring a picture, for inspiration.

One of the patrons even brought his ex-wife's picture.

"I feel that my stress for the day is gone, and I think it's a very, very good way to de-stress at the end of the day," he said.

- CNA/de

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BlackBerrify your iPhone with Spike keyboard case

LAS VEGAS--No one likes typing on a touch screen. So what if your iPhone case had a very mini QWERTY keyboard?

That's just what Spike from SoloMatrix is designed to be. When we heard about it last year, the Spike TypeSmart keyboard was part of a Kickstarter campaign that proved successful.

The tactile keyboard swivels out from its case and its keys make contact with the iPhone's on-screen keyboard.

It doesn't require separate charging, docking, or an app, and it works with capacitive conductivity through the screens on the
iPhone 4 and
iPhone 5.

Whenever a key is pressed and makes contact with the screen, it creates a grounded state.

Spike attaches to the phones in a snap. There's a number key that pushes the number menu on the iPhone's on-screen keyboard. Then you can type using the alternate number designations for the TypeSmart.

But your fingers better be very nimble indeed to get the hang of it. When I tried typing a few sentences, certain keys didn't register and words were missing letters.

I have a BlackBerry Curve, and there's really no comparison between the ease of use of its keyboard and Spike. The former wins hands down.

But if you want something very compact that doesn't require separate power or Bluetooth, Spike may be worth considering.

The iPhone 4/4s version will launch in February for $49.95, with the iPhone 5 edition following.

The price may drop if there's high order volume, according to Cody Solomon, SoloMatrix co-founder.

Since the campaign raised some $81,000, Spike could prove popular indeed.

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N.Y.'s Cuomo pushing for much tougher gun law

A deal that would give New York one of the toughest gun control laws in the nation was being sought by Gov. Andrew Cuomo who, sources told CBS New York station WCBS-TV, was hoping to announce the plan Wednesday during his State of the State address.

The sources said Cuomo was negotiating furiously with legislative leaders in an attempt to reach a deal before the address.

The measures would be a response to gun violence in the U.S., including the tragic shooting at Sandy Hook Elementary School in Newtown, Conn., in which 26 children and adults were killed.

Sources said the package was expected to include new restrictions on assault weapons, stiffer penalties for using a gun to commit a crime, and new limits on the number of bullets in a gun magazine.

Cuomo's move comes as New York City Mayor Michael Bloomberg's Mayors Against Gun Violence released a new commercial to push for federal action.

It features Roxanna Green, the mother of Christina Taylor-Green, who was killed two years ago Tuesday in the Tucson, Ariz., massacre in which former Rep. Gabby Giffords was wounded.

"How many more children must die before Washington does something to end our gun violence problem?" Roxanna Green asks in the ad.

It would be quite a coup for Cuomo, a potential 2016 presidential candidate, to show progress on gun control as Washington stays divided on the controversial topic.

Late Tuesday night, a Cuomo spokesman said the sides still had not reached an agreement, but sources said there was talk of keeping the legislature in session the rest of the week to make sure a deal gets done.

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Dead Lotto Winner's Wife Seeks 'Truth'

The wife of a $1 million Chicago lottery winner who died of cyanide poisoning told ABC News that she was shocked to learn the true cause of his death and is cooperating with an ongoing homicide investigation.

"I want the truth to come out in the investigation, the sooner the better," said Shabana Ansari, 32, the wife of Urooj Khan, 46. "Who could be that person who hurt him?

"It has been incredibly hard time," she added. "We went from being the happiest the day we got the check. It was the best sleep I've had. And then the next day, everything was gone."

Ansari, Khan's second wife, told the Chicago Sun-Times that she prepared what would be her husband's last meal the night before Khan died unexpectedly on July 20. It was a traditional beef-curry dinner attended by the married couple and their family, including Khan's 17-year-old daughter from a prior marriage, Jasmeen, and Ansari's father. Not feeling well, Khan retired early, Ansari told the paper, falling asleep in a chair, waking up in agony, then collapsing in the middle of the night. She called 911.

Khan, an immigrant from India who owned three dry-cleaning businesses in Chicago, won $1 million in a scratch-off Illinois Lottery game in June and said he planned to use the money to pay off his bills and mortgage, and make a contribution to St. Jude Children's Research Center.

"Him winning the lottery was just his luck," Ansari told ABC News. "He had already worked hard to be a millionaire before it."

Illinois Lottery/AP Photo

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Jimmy Goreel, who worked at the 7-Eleven store where Khan bought the winning ticket, described him to The Associated Press as a "regular customer ... very friendly, good sense of humor, working type of guy."

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Khan's unexpected death the month after his lottery win raised the suspicions of the Cook County medical examiner. There were no signs of foul play or trauma so the death initially was attributed to arteriosclerotic cardiovascular disease, which covers heart attacks, stroke or ruptured aneurysms. The medical examiner based the conclusion on an external exam -- not an autopsy -- and toxicology reports that indicated no presence of drugs or carbon monoxide.

Khan was buried at Rosehill Cemetery in Chicago.

However, several days after a death certificate was issued, a family member requested that the medical examiner's office look further into Khan's death, Cook County Medical Examiner Stephen Cina said. The office did so by retesting fluid samples that had been taken from Khan's body, including tests for cyanide and strychnine.

When the final toxicology results came back in late November, they showed a lethal level of cyanide, which led to the homicide investigation, Cina said. His office planned to exhume Khan's body within the next two weeks as part of the investigation.

Melissa Stratton, a spokeswoman for the Chicago Police Department, confirmed it has been working closely with the medical examiner's office. The police have not said whether or not they believe Khan's lottery winnings played a part in the homicide.

Khan had elected to receive the lump sum payout of $425,000, but had not yet received it when he died, Ansari told the AP, adding that the winnings now are tied up as a probate matter.

"I am cooperating with the investigation," Ansari told ABC News. "I want the truth to come out."

Authorities also have not revealed the identity of the relative who suggested the deeper look into Khan's death. Ansari said it was not her, though she told the AP she has subsequently spoken with investigators.

"This is been a shock for me," she told ABC News. "This has been an utter shock for me, and my husband was such a goodhearted person who would do anything for anyone. Who would do something like this to him?

"We were married 12 years [and] he treated me like a princess," she said. "He showered his love on me and now it's gone."

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