Reserve Bank of India Governor D Subbarao is not alone in resisting pressure from the finance ministry to cut rates by a higher margin. Bank of Thailand Governor Prasarn Traiatvorakul cut the policy rate by 25 basis points on Wednesday even though the country’s finance minister went public with a demand for a 50-75 bps reduction. The similarity doesn’t end there. Subbarao’s concerns about lack of monetary policy transmission seem to be the same as his counterpart in Thailand. A day after the policy rate cut, the head of Siam Commercial Bank said he needed to review the liquidity position and will certainly not be a leader in reduction of interest rates.
Bodhi tree diplomacy
Prime Minister Manmohan Singh today presented a sapling of the original Bodhi tree from Bodhgaya to the Thai King. Though Singh was originally scheduled to meet the ailing king at Bangkok’s Siriraj Hospital, a last-minute medical advisory prevented him from doing so. Instead, the sapling was given to Thai PM Yingluck Shinawatra who will forward it to the king. Indian and Thai diplomats are seeing this as a major goodwill gesture as Buddhists in Thailand and around the world worship the Bodhi tree as sacred.
The Bangkok-Tokyo divide
The Japanese media broadly ignored the Indian PM's visit to their country. Over the three days that the PM was in Tokyo, there were only a couple of one paragraph news items in the papers apart from a few sponsored supplements by Indian companies with business links in Tokyo. Only one local newspaper played up the joint statement as its main story of the day. Asked about the lukewarm media response, one of the senior most Japanese government official said with tongue firmly in his cheek that even he was angry about it. But the Thai media seems to be more than making up for that. All the leading dailes in Bangkok have splashed the PM’s two-day visit on their front pages.
China guides Thai tourism
The Thai economy is facing growth pangs but the tourism industry is booming. The Tourism Authority of Singapore has set a target to lure 24.5 million tourists, up from 19.09 million last year. And the target for 2015 is an even more ambitious 30 million. To put the figures in context, foreign tourist arrivals in India in 2012 was 6.65 million. Apart from its famous sea, sand and sun, the tourism industry in Thailand are thanking a Chinese movie, Lost in Thailand, which was shot in the northern part of the country, for the surge in tourism. That’s evident from the growing number of Chinese tourists after the mega-hit movie was released.
