The Walmart of space...  

'Splain to me again how we are going to compete technologically with India.

While India’s recent launch of a spacecraft to Mars was a remarkable feat in its own right, it is the $75 million mission’s thrifty approach to time, money and materials that is getting attention.

Just days after the launch of India’s Mangalyaan satellite, NASA sent off its own Mars mission, five years in the making, named Maven. Its cost: $671 million. The budget of India’s Mars mission, by contrast, was just three-quarters of the $100 million that Hollywood spent on last year’s space-based hit, “Gravity.” [More]

As the world splits into a tiny number of extremely rich and a gargantuan population of poor, the middle class will be built by societies like this, I think.

We may have fallen into a logical trap of assuming they will have to upgrade their vast agricultural system before becoming a true competitor. Maybe the Indian leadership believes it is better to keep most down on the farm progressing slowly through an agrarian phase until labor demand pulls them to the cities.

The ongoing farmland wars...

While I have been posting about the demand for farmland from developing countries - well, mostly China - there is another ugly wrinkle, it would appear, as the Indian government seems to be fronting for the very large and successful.

In principle there ought to be an economic answer to the economic question of whether a steel mill is a better use of land than a farm. If the mill is so valuable, why can't its owner offer the peasants an irresistible sum to leave? But here the market takes a back seat behind politics and thuggery.

It's no mystery why things have gotten worse. "India's boom period has coincided with maximum dissent and dissatisfaction in rural India," says Ajai Sahni, executive director for the Institute for Conflict Management, a New Delhi think tank. Over the last decade the Indian government has been trying by legal and other means to lock up the land for public projects like power plants and, more recently, for private enterprises like Tata. (Under the Indian constitution nontribal people are prohibited from directly acquiring land in certain parts of the country, so the government must obtain it on their behalf and sell it to the companies.) That trend has put the state more and more in conflict with the Maoist rebels, and it has ratcheted up paramilitary operations against them. The government has also squared off more frequently against those who have farmed the land for centuries, using various legal entitlements--and, villagers often claim, resorting to fraud or force--to gain possession of the property. Other times the state simply seizes the land, labeling any resistance rebel-inspired. Hundreds of thousands of people have been dispossessed and displaced. Many now live in what could become permanent refugee camps, where they are prey to both sides of the proxy war and easy converts to radicalism. [More]

This is another difficult aspect of wildly uneven prosperity, and reinforcement for my concerns about what could happen here as well.  Not necessarily like this, but our own brand of government by wealth.

It's not just my yields...

That have been disappointing. Agriculture is struggling to grow in India.

India has been providing farmers with heavily subsidized fertilizer for more than three decades. The overuse of one type—urea—is so degrading the soil that yields on some crops are falling and import levels are rising. So are food prices, which jumped 19% last year. The country now produces less rice per hectare than its far poorer neighbors: Pakistan, Sri Lanka and Bangladesh.
Agriculture's decline is emerging as one of the hottest political issues in the world's biggest democracy.

On Thursday, Prime Minister Manmohan Singh's cabinet announced that India would adopt a new subsidy program in April, hoping to replenish the soil by giving farmers incentives to use a better mix of nutrients. But in a major compromise, the government left in place the old subsidy on urea—meaning farmers will still have a big incentive to use too much of it. [More with great comments]

It was whopping purchases of potash that ignited the run on that commodity back in 2008. And I suspect their shifting much of that business to Russia will further hassle Canadian potash suppliers.

Belarusian Potash Co., the world’s biggest exporter of the fertilizer, expects to sign contracts with India, the largest importer, in a “matter of weeks” as global demand strengthens.

The new contracts will most likely run through at least December and deliveries may start as soon as April, BPC sales chief Oleg Petrov said in an interview. BPC, which represents Belarusian and Russian producers, expects talks to start in the next two weeks, he said.

International Potash Co., the biggest supplier to India, said earlier this month the Asian nation may start running out of the fertilizer as early as March. Prices fell as low as $350 a metric ton last year from as much as $1,000 in 2008 as a slump in grain prices spurred farmers to curb purchases. India agreed to buy potash from marketer Canpotex last week at $370, signaling improving demand. [More]

I'm starting to doubt the potash cartel can survive in its present form as India and China are now large enough to deal seriously, and Russian competition and capacity can take advantage of much lower freight costs.