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Gender Awareness Training

2008-03-18T07:42:00.000-07:00

Socio Gender Constructive
In this session, we are going to learn about the Gender Concept as a socio construction, and about different thing between gender and sex. We may see the important question below.
How the society influence the perception about male and female?.
Why the culture can influence the habits of male and female? Its possible to change our perception about masculinism and feminimism in order to gain healty gender.

# Definition
Sex and Gender – Sex refer to the biological characteristics that catagories someone as either female and male; whereas gender refers to the society determined ideas and practices of what it is to be female or male.
In example
Female can give a birth but male can’nt this is true and that why distinquished about sex.
Female can cook and male can’nt this is false because female and male can cook, female are advised to cook coused by the society decided them to cook.
This is what we call as Gender

# AusAID Gender Policy

From the viceversa issue of overarching.
The purpose is to decrease a number of poorness with equal gender developed and right for female.
Increase a female economically.
Equal participation in decision making and leading, including in tough situation and conflict.
Incresing a suit healty and education for male and female, boy and girl.
Improving a gender stratety in district relationship.

# Four Demention of Gender Strategy
- Access
- Decision Making
- Women Right
- Improving Gender Strategy

# The Four A’s Strategy
Availability
Accountability / Adaptability
Accessability
Acceptability

George Soros to invest in oil palm sector in Aceh

2007-10-01T13:36:00.000-07:00

One of the world's best-known fund managers, George Soros, plans to invest in the oil palm plantation sector in Nanggroe Aceh Darussalam, its governor, Irwandi Yusuf, said Thursday after meeting with Soros in New York recently. "He said that he was interested in developing an oil palm plantation of about 20,000 hectares during the first stage.

This kind of investment could feed around 2,500 families in Aceh," Irwandi said as reported Thursday by Antara. The governor could not put a precise figure on the investment, or the likely timeframe.

However, he promised that his administration would work hard to help Soros realize the plan. "Both sides will immediately get to work on ensuring that this investment plan is realized," Irwandi said. Soros is best known for his famous bet against sterling as Britain was forced to pull its currency out of the European currency grid in 1992.

This eventually earned Soros an estimated US$1.1 billion. Following this, he was dubbed "the man who broke the Bank of England." During the 1997-1998 Asian crises, his name was repeatedly linked to speculation that led to the devaluation of Southeast Asian currencies, although he consistently rejected the accusations. Then Malaysian prime minister Mahathir Mohammad was particularly strident in making accusations against Soros.

With an estimated net worth of around $8.5 billion, he is ranked by Forbes magazine as the 80th-richest person in the world. A Hungarian-born U.S. citizen, Soros is said to have started investing in Indonesian companies in 1999, buying shares in investment firm PT Bhakti Investama and PT Agis, which is a distributor for 14 household and electronic brands, such as Sony, Toshiba, Philips, Goldstar and RCA.

Currently, he is the chairman of Soros Fund Management and the Open Society Institute. Both institutions are heavily engaged in philanthropic activities. With the price of crude oil continuing to increase in the recent years, biofuel has become the most sought-after alternative energy source, with crude palm oil (CPO) being one of the main raw materials. Currently, Indonesia has the largest oil palm hectarage in the world, with 6.1 million hectares in Sumatra, Kalimantan, Sulawesi, Papua and, to a lesser degree, Java. "Aceh has a vast land area with a lot of potential, especially in the oil palm sector.

However, we do not have the money to develop this potential," Irwandi said. Attracting foreign investment has been one of Irwandi's main tasks since he was elected governor in Aceh's first democratic local election in February this year. In the current era of peace and recovery following 32 years of civil unrest, as well as the 2004 tsunami disaster, Aceh is opening up its arms to investment, especially in the energy, mining, agricultural and fisheries sector.

In 2005, oil palm plantations in the province produced nearly 250,000 tons of CPO from an area of 163,000 hectares. Investment procedures in Aceh have improved since the establishment of the Aceh One-Stop Investment Service (KPTSP), where business permits can be processed within 7 working days at the latest.

Aceh province seeks expertise from UN in India

2007-10-01T13:34:00.000-07:00

Inspired by the networks of development practitioners facilitated by the United Nations in India under its Solution Exchange initiative, the tsunami-hit Aceh region of Indonesia has reached an agreement with the United Nations Country Team in India to seek expertise for establishing similar networks for disaster recovery and rehabilitation.

A Memorandum of Understanding was signed on 20 August in New Delhi by the Governor of Aceh Province representing the agencies for recovery and rehabilitation in Aceh region and the UN Resident Coordinator in India.

After the signing of the MoU, the Governor of Aceh Province, Dr. Irwandi Yusuf commented, “Earlier I had five advisors to provide me with policy making advice and now, with the establishment of Solution Exchange Communities of Practice, I will have five million advisors with me in Aceh.”

The United Nations Country Team’s Solution Exchange concept which was established in India in 2005 now has eleven Communities of Practice, offering development practitioners in India a forum for sharing knowledge and experience of development challenges in pursuit of the MDGs. This knowledge management partnership of the UN in India has offereds expertise and experience to assist in the development of the Solution Exchange model to foster communities of practice in Aceh and Nias.

At the signing of the MoU the Resident Coordinator for UNCT India, Dr. Maxine Olson said: “The UN in India has been very enthusiastic about Solution Exchange as a new role for the various UN agencies that taps its convening power and offers an impartial space for practitioners to share knowledge and experience. We are sure that the operations in Aceh and Nias will find these networks to have the same effect, and will add more value to the rehabilitation and reconstruction work of the UN Agencies in Indonesia.”

The Solution Exchange initiative in Aceh and Nias which will be initiated in November 2007, will catalyze in multi-level coordination in recovery and rehabilitation efforts, minimizing gaps, providing linkages and strategic policy advice.

Aceh Inviting Foreign Investors

2007-10-01T13:04:00.000-07:00

First Democratically-Elected Governor thanks Americans for supporting tsunami relief and presents future of job growth and economic development in Aceh
NEW YORK -- The American Indonesian Chamber of Commerce and the Building Bridges to the Future Foundation, Inc. today announced the beginning of Governor Irwandi Yusuf's visit to the United States.
"After 30 years of conflict and the devastating tsunami in December 2004, the people of Aceh are at an important cross-road that will determine success for future generations," said Sara Henderson, President of the Building Bridges to the Future Foundation. "For the first time in their history, the people of Aceh have a democratically- elected leader who will vigorously represent their interests in recovery and in sustainable economic development to create jobs."
"Aceh is open for business and the US is already their largest trade and investment partner," declared Wayne Forrest, President of the American Indonesian Chamber of Commerce. "Irwandi's vision for Aceh is to create jobs and encourage economic development. He is in the US to promote Aceh's world-famous Sumatran Arabica coffee beans, significant palm oil resources that can be produced into biodiesel, and his commitment to environmental policies that will generate carbon credits that can be sold to carbon-generating countries like the US."
Following is Governor Irwandi's schedule of events in the US, as of September 9th. He is accompanied by a delegation of Aceh business leaders and the Aceh Investment Office

Business Regulation In Indonesia / Aceh

2007-03-20T04:27:00.000-07:00

Doing Business in Indonesia
Business Regulations

Indonesia is in the process of updating the country’s business regulations to make them competitive with the international business community. This chapter discusses briefly some of the most important regulations and useful information to consider in doing business in Indonesia. These are employment regulations; financial reporting and auditing requirements; intellectual property rights and land rights; stock and bond listing requirements and; regulations of the Jakarta Futures Exchange.
1. Employment Regulations
The Department of Manpower is the government agency that regulates employment practices in Indonesia. It supervises employment conditions, acts as mediator in labor disputes,operates training institutes, issues work permits to expatriates, sets minimum wages, and handles other human resources matters.
Hours of Work and Overtime Payments
The basic 40-hour workweek is comprised of eight-hour days Monday through Friday. Some offices, however, are open seven hours per day, Monday through Friday and five hours on Saturday. For overtime, labor regulations specify that from Monday to Saturday the first hour should be paid 1.5 times the basic hourly rate and two times the basic hourly rate for each additional hour. For Sundays and public holidays, overtime pay is two times the basic hourly rate within the considered normal working hours of the company, afterwards overtime pay is three times the basic rate for the first hour and four times the basic hourly rate for each additional hour.
Wage Rates
Indonesia has competitive wage rates for unskilled workers in Asia but considerable differences exist between industries and geographic locations. For example, wages in the oil sector are higher than those in the agriculture sector, and wages in urban Jakarta are higher than in rural Java and other islands.The Ministry of Manpower regulates the minimum wage for each province or city. For example, the Ministry issued a regulation setting the monthly minimum wage rate in Jakarta at Rp. 426,250 as of January 1, 2001.
Attachment 1, shown at the end of this chapter, contains a list of the current wage rates for 26 provinces in Indonesia.
Leave and Holidays
There are generally 13 paid public holidays in a year. Based on Government Regulation No. 21 Year 1954, employees are entitled to a maximum of 12 working days of paid annual leave. An employee is entitled to receive sick leave for a period of up to 12 months. A female employee is entitled to a three month paid maternity leave. Employees are also given paid leave for occasions such as the birth of a child (one-day) and a death in the family (two days).
Fringe Benefits
Indonesian workers are generally entitled to fringe benefits from their employers. Some of these are:
Payment of income tax due on salaries and wages;
An annual bonus of one month’s pay, usually paid at Lebaran (theannual Moslem festival);
Medical expenses; and
Travel and meal allowances.
Termination
It is a normal procedure for employers to have their new employees (for permanent employment only) undergo a three-month probationary period. During this three-month period the employers, at their discretion, can dismiss these new employees. However, after this three-month period, dismissal requires the permission of the Committee for Settlement of Labor Disputes of the Department of Manpower. Should permission be granted, the company is required to provide severance payment, merit payment or service payment to the terminated employee.
Employee termination as well as the calculation of severance pay, merit pay and service pay must comply with the manpower regulations, which currently refer to the Decree of the Minister of Manpower No.150/2000. The amount of the severance payment depends on the number of years of service. Therefore, the longer the period of service, the higher the severance pay as well as the merit pay and the service pay. The service pay varies from onemonth to seven months gross salary. However, in special cases, the payment of severance pay, merit pay and service pay can be higher than the above stipulation. Again, this depends on the agreement between the employer and employee.
With regard to employment termination, the common practice is to give an employee three written warnings prior to terminating service.
Social Security
The cornerstone of Indonesia’s social security system is known locally as “Jaminan Sosial Tenaga Kerja” (JAMSOSTEK). Companies that employ at least ten persons and have a payroll of at least Rp. 1 million a month must participate in an employee social securityprogram provided by PT JAMSOSTEK, a limited state-owned social insurance company. PT JAMSOSTEK provides benefits to employees for workplace accidents, death, health care and retirement. Employer and employee contributions to JAMSOSTEK vary by industry and program. Employees only contribute a share of their income to the retirement program; contributions for the other programs are borne exclusively by the employers. These rules arealso applicable to expatriates, however not mandatory, and they are allowed to withdraw their accumulated premiums when they leave the country.

Labor Unions
The Law on Labor Unions dated August 2000 describes workers’ rights to establish and develop a labor union that is independent, open, self-reliant, democratic and responsible. The Law further indicates that a labor union can be established by at least ten workers and grants unions the right to enter into collective labor agreements with employers and to represent workers in settling industrial disputes.
With the Government of Indonesia’s ratification of ILO Convention 98, any party is permitted to establish a trade union. At the company level there are thousands of trade unions. Membership in any trade union is not compulsory.

2. Financial Reporting and Auditing Requirements
Books of Accounts and Statutory Records
The Indonesian law requires business enterprises to maintain books and records in such a manner that their financial position may be determined at anytime. The Commercial Code requires that books and records be preserved for 30 years. On the other hand, tax lawrequires that records be kept for ten years.
Companies or taxpayers with basic mining contracts, production sharing contracts with Pertamina (the state oil and gas corporation), and those undertaking business activities in the cooperation areas of the Timor Gap - Zone A, may use English and the US Dollar fortax record-keeping and tax reporting purposes. PMA companies, permanent establishments (PEs) and taxpayers who are affiliates of foreign companies, can use English and the US Dollar for tax record-keeping and tax reporting purposes provided they obtain approval from the Minister of Finance.
Generally Accepted Accounting Principles and International Auditing Standards
In Indonesia, the Generally Accepted Accounting Principles (Indonesian GAAP) are referred to as Pernyataan Standar Akuntansi Keuangan or PSAK and the Indonesian Generally Accepted Auditing Standards (Indonesia GAAS) are referred to as Standar ProfesiAkuntan Publik or SPAP.
The PSAK and SPAP are promulgated and issued by the regulatory body of accountants in the country - the Indonesian Institute of Accountants. The BAPEPAM (Badan Pengawas Pasar Modal) referred to as the Capital Markets Supervisory Agency, or the country’sSecurities and Exchange Commission, also promulgates and issues regulations and rules on the accounting treatment for certain accounts and transactions of public companies. In addition, BAPEPAM issues industry-specific guidelines for publicly listed companies and themutual fund, broker-dealer and securities industries. The Indonesian GAAP primarily adopts International Accounting Standards and some of the US Statements of Financial AccountingStandards while the Indonesian GAAS adopts most of the Auditing Standards promulgated by the American Institute of Certified Public Accountants.
Filing/Reporting Requirements
Companies of identified industries are required to submit their annual audited financial statements to specified government regulatory agencies. Publicly listed companies have to submit their annual audited financial statements to BAPEPAM and the Jakarta or Surabaya Stock Exchange 120 days after the end of their fiscal year. These companies are also required to submit their annual audited financial statements to the Department of Trade andIndustry 180 days after the end of their fiscal year. Technically there are no explicit regulatory requirements to submit audited financial statements to the Tax Office, however, practically some tax officials will expect the taxpayer to attach a copy of the audited financialstatements with the annual tax return when lodged. During tax examinations, examiners will normally ask for the corporation’s annual audited financial statements if there are any.The table below summarizes the specified industries and companies that are required to file audited annual financial statements, and their submission deadline.

3. Intellectual Property Rights (IPR)
Indonesia is a member of the World Intellectual Property Organization and a party to the Paris Convention for the protection of Intellectual Property. Indonesia is also a signatory of the General Agreements on Tariffs and Trade (GATT) and to its subsidiary agreement, GATS. The government recognizes the importance of intellectual property protection, and has drawn up a number of bills increasing the protection of intellectual property rights. Indonesianow has laws covering Patents, Copyrights, and Trademarks.
Recently enacted laws include the Law on Protection of Plant Varieties (Law No. 29 Year 2000), Law on Trade Secrets (Law No. 30 Year 2000), Law on Industrial Design (Law No. 31 Year 2000), and Law on Layout and Design of Integrated Circuits (Law No. 32 Year 2000).
Copyrights
Law No 6 of 1982 as amended by Law No 12 of 1997 governs copyrights in Indonesia. The laws specify the items eligible for copyright protection and the corresponding sanctions forinfringements. It should be noted that these laws only protect foreign copyright owners if Indonesia acceded to one of the international copyright conventions or signed a bilateral treaty with the country that granted the copyright.
As of May 2000, Indonesia’s Directorate of Intellectual Property Rights has submitted three bills on copyrights to the House of Representatives. The bills deal with industrial design, integrated circuits and trade secrets. The government also proposes raising penalties for copyright violators from Rp. 100 million to Rp. 300 million as well as raising the maximum penalty to seven years imprisonment.
Patents
Law No 6 of 1989 as amended by Law No 13/1997 governs patents in Indonesia. Under the law, patents are classified into regular or simple. Regular patents are special rights granted by the government allowing an inventor or other parties to develop the new invention fora certain period of time. A patent is granted for a period of 20 years starting on the date the application for the patent is received. Simple patents are those inventions, products or methods of production, that do not qualify as new inventions. They are valid for ten years starting from the date when the Certificate of Simple Patent is granted.
Patent holders are allowed to use the patent only in Indonesia except if approved by the Patent Office for outside use. If a product is imported to Indonesia and an Indonesian patent already protects the process by which the relevant product is made, the holder of therelevant Indonesian patent for the process is entitled to take legal action in Indonesia against the manufacturer of the imported product.
Trademarks
Law No 19 of 1992 as amended by Law No 14/1997 governs trademarks in Indonesia. Individuals or companies use trademarks to distinguish their products from other similar products. The Trademark Office may reject the application for the registration of atrademark that is similar, in principle or in whole, to well- known trademarks belonging to other individuals or companies for goods and/or services of the same type.Application for trademark registration using a priority right, as regulated in the International Convention on the Protection of Trademarks, is to be filed in Indonesia no later than six months after the initial filing for trademark registration in another country which is either a signatory to the convention or a WTO member.

4. Land Rights
The Basic Agrarian Law of 1960 is the foundation of land laws in Indonesia. There are 11 land rights under this law. The following are the laws most relevant to an investor:

Right of Ownership (Hak Milik) is an inheritable right reserved for Indonesian citizens only. While legal entities are theoretically entitled to this right, in practice it is no longer issued to them. The right can be sold, exchanged, bequeathed or otherwise transferred.

Right of Exploitation (Hak Guna Usaha) is the right to use land for purposes of agriculture, fishing or cattle raising. The title may be held by PMA companies and may be used as collateral or security for financing purposes. Recent regulatory changes allow title to begranted for 35 years with a guaranteed extension of 25 years if the land is properly used and managed. Thereafter, assuming certain requirements are fulfilled, title can be renewed.

Right of Building (Hak Guna Bangunan) is the right to construct and own buildings on land. This is the right most commonly obtained by PMA companies. Recent regulations provide for an initial grant period of 30 years and guaranteed extension of 20 years. Thereafter, the right is renewable provided the land is used for the same purpose and all regulatory requirements are met.

Right of Use (Hak Pakai) is the right to use land for a specified purpose. The law prescribes the right of use for a period of 25 years with a maximum extension period of 20 years. It is commonly granted to representatives of foreign governments for construction of embassy buildings and to social, cultural and religious organizations. It has no collateral value to the holders and is not transferable.

Right of Lease (Hak Sewa) is similar to leasehold. Leasehold rights are normally granted to tenants of both residential and commercial premises. Foreign residents in Indonesia as well as foreign corporate representative offices are entitled to lease property. No law or regulation limits the duration of a lease.The government offers foreign investors land rights that are relevant to the nature of their business. Prospective buyers of land for any purpose should consult the local government authorities on land use, planning and zoning. Based on a Presidential Decree issued in June 1996, foreigners domiciled in Indonesia are allowed to own one residential property.To meet the regulations of ownership of a house or an apartment, a foreigner must be deemed to be “beneficial to national development” and must be either:

An Indonesian resident (domiciled permanently in Indonesia) in possession of a permanent resident permit; or
A non-resident (domiciled in Indonesia only at particular times) inpossession of appropriate visit and immigration stamps in his/her passport.

A foreigner can purchase or construct a house built only on land with the right of use (Hak Pakai), the right of use with the right of proprietorship, or the right of lease (Hak Sewa). An apartment can only be purchased by a foreigner on land with right of use (Hak Pakai). Foreigners are not, however allowed to purchase houses or apartments classified as “low cost housing” or “very low-cost housing”.
Ownership is limited to 25 years, and is extendible for another 25 years provided that the foreigner remains an Indonesian resident or meets the status requirements. If the foreigner departs from Indonesia, the property must be sold or transferred within one year after departure. If the foreigner or his family does not use the house for more than 12 consecutive years, then the foreigner forfeits the “being domiciled” status, for the purpose of owning residential property.

5. Stock Exchange Listing Requirements
The Capital Market Supervisory Agency (BAPEPAM) supervises, regulates and monitors, the activities of the Indonesian capital market, and protects the interests of the investing public. Indonesia has two stock exchanges, the Jakarta Stock Exchange (JSX) or Bursa Efek Jakarta (BEJ) and the Surabaya Stock Exchange (SSX) or Bursa Efek Surabaya (BES).

Share Listing Requirements
On June 30, 2000 the BEJ introduced new listing regulations as part of its effort to increase its competitiveness among regional exchanges and to increase the level of confidence in the capital market. These regulations authorized the creation of the Main Board and Development Board and required companies to implement good corporate governance practices.
Creation of the Main Board and Development Board
Company listings will be classified under one of two boards - the Main Board and the Development Board. The Main Board lists large companies that have a track record of profitability. Companies that have good prospects but are not yet profitable and all othercompanies that fail to meet the requirements of the Main Board will be listed on the Development Board. Therefore, start up companies can list their shares on the secondary board.
The following are several of the requirements for listing on the Main Board:

Financial statements with an unqualified opinion for the last three years.
At least one million shares for listing with at least 200 shareholders, each owning at least one trading lot.
Operational and net profits in the last two fiscal years.
Total assets of at least Rp. 30 billion and paid-in capital of at least Rp. 3 billion.

Implementation of Good Corporate Governance Practices
The new regulation requires listed companies to implement good corporate governance practices. The companies are required to:

Have independent commissioners (not affiliated with the controlling shareholders and/or other directors, not an interlocking director, or not appointed by the controlling shareholders in the Shareholders’ General Meeting).
Have an Audit Committee composed of at least three members: an independent commissioner and the rest independent external parties with accounting and finance capabilities.
Have a shareholder composition in which the minority shareholders hold at least 5% of paid-up capital or 10,000 shares for the past six months.
Possess eco-labeling certificates for companies focused on forest concessions.
Submit financial statements to the BEJ on time, or face the risk of transfer to the Development Board if financial statements are submitted more than ten trading days after the set deadline.

Mutual Listing Agreement
The Jakarta Stock Exchange (JSX) and the Amsterdam Exchange (AEX) on March 2000 signed a mutual listing agreement. The bourses have agreed that all companies listed on the JSX as of the year 2000 will be given an automatic listing on the AEX as well.
Bond Listing Requirements
Listing of bonds, like shares, is regulated by the respective stock exchanges. To qualify for listing on the BEJ, bond issuers should have been operational for at least three years; report operating profits for the last two years with no deficit in the balance sheet; list bonds with a face value of at least Rp. 25 billion and a duration of the outstanding bonds of at least four years; and submit their latest audited financial statements with an unqualified opinion from apublic accountant.

6. Jakarta Futures Exchange
The Jakarta Futures Exchange (JFX) was established in August 1999 and commenced operations in December 2000. It is the first futures exchange in the country. The JFX serves as a central location where buyers’ and sellers’ agents meet to trade futurescontracts on the commodities the exchange lists for trading. The commodities traded include crude palm oil, robusta coffee, pepper, plywood, cocoa and rubber. The exchange also plans to include financial trading instruments such as foreign exchange, interest rates and government bonds. Its listed brokers are PT Batavia Futures, PT Artha Berjangka, PT Dana Graha Futures and PT Gading International Berjangka.

7. Regional Autonomy
Law No. 22/1999, “the Law on Regional Administration”, was designed to regulate regional administration and implement the principle of decentralization. Regional autonomy will beimplemented by providing wide-ranging, concrete, fair, and responsible authority to the regions in proportion to their share of national resources. Fundamental portions of this law shall include efforts to bolster the empowerment of the community, foster initiative and creativity, promote community participation, and develop the role and function of Regional Legislative Assemblies.
When Law No. 22/1999 came into effect January 2001, regional governments were granted the authority to regulate their own domestic matters including those related to local business activities. However, since the new system has just begun and is still being fully implemented, there is little information on this subject. The scope of regional autonomy and administration and the contents of future regional regulations have yet to be determined. It should be noted that future regulations issued by regional governments might differ from the existing regulations issued by the central government.
In relation to Law No. 22/1999 to establish regional autonomy, the government issued Law No. 25/1999 regarding Financial Equilibrium between the Central Government and Regional Administrations. The law regulates government financial systems and encompasses thedistribution of funds between the central government and regional administrations. The law is designed to promote inter-regional equity and takes into account the potential, condition and needs of a region. In addition the law addresses regional obligations, the distribution of regional authority and procedures for the exercise of said authority, including financial management and supervision.
Finally, the law regulates the authority of a region to establish reserve funds originating from regional revenues, and a system of financial management and accountability in implementingdecentralization and assistance tasks. The main purposes of this law are empowerment and promotion of regional economic capacity, creation of just, proportional, rational, transparent,participative, accountable and accurate systems of regional financing, and realization of financial equilibrium between the central government and regional administrations.

Attachment 1

Regional Minimum Wages for 26 Provinces As of January 1, 2001

No. Provinces Minimum Wages - Monthly (Rp)

D.I. Aceh 300,000
Sumatera Utara 340,500
Sumatera Barat 250,000
Riau 329,000
Jambi 245,000
Sumatera Selatan 255,000
Bengkulu 240,000
Lampung 240,000
DKI Jakarta 426,250
Jawa Barat 245,000
Jawa Tengah 245,000
DI Yogyakarta 237,500
Bali 309,750
Kalimantan Barat 304,500
Kalimantan Tengah 282,000
Kalimantan Selatan 295,000
Kalimantan Timur 300,000
Sulawesi Selatan 300,000
Sulawesi Tengah 245,000
Sulawesi Tenggara 275,000
Sulawesi Utara 372,000
Nusa Tenggara Barat 240,000
Nusa Tenggara Timur 275,000
Maluku 230,000
Irian Jaya 400,000
Maluku Utara 230,000

Source: Ministry of Manpower and Transmigration of the Republic of Indonesia.

How to do Business In Indonesia / Aceh

2007-03-20T02:41:00.000-07:00

Doing Business in Indonesia / Aceh
Foreign Direct Investment

The new government has been transforming Indonesia into a country with one of the most liberal policy and regulatory frameworks for investments in Southeast Asia. Serious efforts are being made to give investors clearly spelled out investment laws, rules and regulations.
This chapter briefly discusses the general policies and basic guarantees; sectors closed for foreign direct investment; forms of doing business and allowable share ownership; other forms of doing business; direct foreign investment application and approval; employment of foreign nationals and work permits; and environmental concerns.

1. General Policy and Basic Guarantees for Foreign Direct Investment
Indonesia welcomes foreign direct investment, whether by individuals or entities. The investment is made in the form of a limited liability company.

With regard to the percentage of allowable foreign ownership, foreign direct investment is conducted in two ways; namely joint venture with domestic investors or full (100%) foreign investment. The government is continuing to review those lines of business open to foreign direct investment and the allowable percentage of foreign ownership.

With regard to the size of foreign investment, in practice, the Investment Board (the Indonesian government office with jurisdiction over foreign and domestic investment matters) determines the minimum reasonable paid up capital of the limited liability company to be established, depending on the nature and type of business. For example, the reasonable paid up capital for a company in the service sector is normally US$100,000. The Indonesian constitution guarantees foreign investors’ the following basic rights:

Freedom from expropriation without just compensation.
Right to remit profits, capital gains, and dividends within the guidelines of the Bank of Indonesia, the country’s central monetary authority.
Right to remit the proceeds of the liquidation of investments.
Right to obtain foreign exchange to meet principal and interest payments on foreign obligations.

Indonesia is a full member of the Multilateral Investment Guarantee Agency (MIGA), which is a member of the World Bank Group. Investments entered through MIGA are protected against various political risks. The agency was designed to encourage foreign investment by providing viable alternatives for investment insurance against non-commercial risks in developing countries, thereby creating investment opportunities in those countries. Indonesia also has bilateral agreements with 54 countries concerning the promotion and protection of foreign investments. A standard bilateral agreement contains provisions to create favorable investment conditions for nationals of Indonesia and the contracting party on the basis of sovereign equality and mutual benefit. This is designed to stimulate investment in both countries.

2. Lines of Business Closed to Foreign Direct Investment
In principle, all lines of businesses are open to foreign investment, except for those business activities or lines of business that have a vital role in national defense and security, such as the production of weapons, ammunitions, explosives and martial/war equipment.

In addition to these vital business activities, the Government can also determine other lines of business closed to foreign investment as set forth in the Presidential Decree on the “Negative List of Investment” and other regulations. This decree describes not only the lines of business that are closed to foreign investment, but also the lines of business closed to all investment (foreign and domestic), the ratio of ownership between foreign and domestic investors in a joint venture, and the special criteria to be complied with by investors in investment in special lines of business.

According to the current Presidential Decree on the “Negative List of Investment” (Presidential Decree No. 96/2000 dated July 20, 2000 as amended by the Presidential Decree No. 118/2000 dated August 16, 2000), the lines of business that are totally closed to foreign investment include 1) germ plasma cultivation, 2) natural forest exploitation, 3) lumber contractors, 4) taxi/bus transportation services, 5) small-scale shipping, 6) trading and trade supporting services except large scale retailers (malls, supermarkets, department stores, shopping centers), wholesale trading (distributors/wholesalers, exporters and importers), exhibition/convention providers, quality certification service providers, market research service providers, warehousing service providers other than Line 1 and ports, and after-sales services,7) radio and television broadcasting, and 8) cinema operation.
The government has been showing a trend towards relaxing the negative list of investment, with more lines of business being opened up to foreign investment and foreign investors being allowed a greater percentage of ownership.
A summary of the new ruling on foreign investment restrictions is included at the end of this chapter and marked Attachment 1.

3. Setting Up a Foreign Direct Investment Company
A foreign direct investment company in Indonesia (known locally as “Penanaman Modal Asing” or PMA), can take the form of a 100% foreign owned limited liability company or can be established as a limited liability company through a joint venture with Indonesian partners. In the case of a joint venture, the Indonesian partner is required to own at least 5% of the shares. The Corporate Law requires that there are at least two shareholders in a PMA company, or any limited liability company. The shareholders can be two individuals, two companies, or a mixture of both. Therefore, in the case of a PMA company with full foreign ownership, the foreign investor initially planning the investment in Indonesia must invite another foreign party to participate in shareholding of the proposed company.
When a PMA company is established, the initial investment approval from the Board of Investment will be valid for three years. Once the PMA company is ready to start its commercial operations, it is required to apply for a permanent business license, which is valid for 30 years and can be extended for another 30 years. To obtain the permanent business license, the company has to secure the approvals, permits, and licenses required by the different government agencies.

Allowable Share Ownership
Foreign investors may own a maximum of 95% of the shares of PMA companies involved in construction and operations of ports and harbors; processing and provision of clean water for the public; electricity production, transmission and distribution; generation of atomic power; public railway service; shipping and medical services (covering among others building and operation of hospitals, medical check-ups, clinical laboratories and mental rehabilitation service). In the case of telecommunications and regular/non-regular/chartered commercial airlines, foreign investors who wish to participate in these industries must form a joint venture with an Indonesian company. Previously, the foreign ownership in these industries was limited to a maximum of 49%. However, based on Presidential Decree No. 118/2000 dated August 16, 2000, there is no limitation on the percentage. A more conservative interpretation based on the Investment Law, suggests foreign investors may own a maximum of 95% of the shares. A 100% foreign-owned PMA company is required to divest part of its shares to Indonesians within a maximum period of 15 years from the start of its commercial operation.

4. Other Business Forms
Representative Office
A foreign company may establish a Representative Office in Indonesia. There are three types of Representative Office in Indonesia:

Representative Office under the Department of Trade and Industry, which may only conduct promotional activities, market research and information gathering functions.
Representative Office under the Construction Service Development Agency (formerly this type of Representative Office was under the State Ministry of Public Works). This type of
Representative Office allows a foreign contracting company to enter into a Joint Operation Agreement with a local contractor to execute a public works contract of limited scope and
duration. One company may be the main contractor with the other as the sub-contractor.
Regional Representative Office under the Board of Investment, which may only supervise and coordinate the affiliates/branches/subsidiaries for, and on behalf of, its parent company.

Agency and Distributorship
A foreign business firm may appoint an Indonesian person or company to act as its agent or distributor to engage in trading activities. Expatriate personnel may be assigned to and be employed by the Indonesian person or company. However, for those foreign business firms who want to have a business presence in Indonesia, the recent regulations allow the foreign company to set up a PMA company, which can engage in large-scale retail and distribution/wholesale activities.

Cooperation Agreement
A business agreement with a domestic enterprise to provide technical assistance, management, and financial arrangements.

5. Foreign Investment Application and Approval
Foreign investment application and approval, except for investments in the oil and gas and financial sectors, can be obtained at any one of the following: 1) the Office of the Board of Investment (BKPM) in Jakarta, 2) the Regional Investment Coordinating Board (BKPMD) in
the province where the project will be located and 3) the representative office of the Republic of Indonesia where the prospective investor resides.
To apply for investment approval, the foreign investor has to submit to any one of these entities two copies of form Model 1/PMA containing the following information:

Names and descriptions of the applicants
Name of the company, location and main line of business
Annual production and sales of products
Land area, foreign and local manpower, and infrastructure requirements
Capital structure
Project timetable
Foreign investors have therefore the choice of where to apply and secure investment approval. However, for foreign investment projects located in the Bonded Zones, investors should submit the application to the BKPM through the respective Bonded Zone Authority.
After securing the PMA approval, the foreign investor has to secure the permits and licenses required to obtain a permanent business license to operate. For details on Investment Applications visit the Investment Coordinating Board’s website at www.bkpm.go.id.

6. Employment of Foreign Nationals
PMA companies are allowed to appoint foreign managerial staff and technical experts for whom qualified Indonesian nationals are not yet available. A company wishing to have expatriate employees must obtain a work permit for them. Work permits are usually valid
for a 12-month period. To obtain them the employer or sponsor must submit to the Ministry of Manpower, a Manpower Plan. This should include a plan to train Indonesians who will later take over the positions for which the firm is seeking approval.
Within seven days of arrival in Indonesia the expatriate worker and immediate members of his/her family must report to the District Immigration Office of the district where they are residing to obtain a resident (KIM/S) card.

7. Environmental Issues
Foreign investors should always consider environmental protection in connection with their activities located in Indonesia. Disregard of this issue can increase the risk that operations will be closed or interrupted as a result of pressure from non-government organizations or local residents.
Law Number 23 Year 1997 pertaining to the Environment Law, states that compliance with the environmental regulations is mandatory in Indonesia. Therefore, companies operating in
Indonesia should be increasingly aware of the need for environmental protection and preservation.
Attachment 1: Negative Investment List
(As regulated in the Presidential Decree No. 96/2000 as amended by
Presidential Decree No. 118/2000)

Business Fields Totally Closed to Investment:

Agricultural Sector

Cultivation and processing of marijuana and the kinds
Marine and Fishery Sector
Collection/utilization of sponge
Industrial and Trading Sector
Industries of chemical products harmful to the environment, like penta chlorophenol, Dichloro Dipenhyl Trichloro Ethane (DDT), dieldrin, chlordane, carbon tetra chloride, Chloro Fluoro Carbon (CFC), methyl bromide, methyl chloroform, halon, etc.
Industries of chemical products stipulated in the Schedule I of the Chemical Weapon Convention (sarin, soman, tabun, mustard, levisite, ricine and saxitoxin)
Industries of weapons and components
Industries of cyclamate and saccharine
Industries of alcoholic drinks (liquor, wine and drinks containing malt)
Operation of casinos/gambling
Communications Sector
Air traffic system providers (ATS providers) as well as ship statutory and classification surveys
Management and operations of Radio Frequency Spectrum and Satellite Orbit Monitoring Stations
Mining and Energy Sector
Mining or Radioactive minerals

Business Fields Closed to Investments with Ownership of Foreign Citizens and/or Statutory Bodies in Corporate Capital
Forestry and Plantation Sector
1. Germ plasma cultivation

2. Concessions for natural forest

3. Contractors in the field of lumbering
Communications Sector
4. Taxi/bus transport services

5. Small-scale sailing
Trading Sector
6. Trading and trading supporting services

EXCEPT: large-scale retailer (malls, supermarkets, department stores, shopping centers), wholesale trading (distributors/wholesalers, exporters and importers), exhibition/convention service providers, quality certification service providers, market research service providers, warehousing service providers other than Line I and seaports and after-sale service providers.
Information Sector
7. Radio and television broadcasting service providers, radio and television broadcasting subscription service providers, print media information service providers.

8. Film industry (film making businesses, film technical service providers, film export and import businesses, film distributors and movie house operators and/or film showing service).
Business Field Open to Foreign Investment on Condition of Joint Venture between Foreign and Domestic Capital
1. Building and operation of seaports

2. Electricity production, transmission, and distribution

3. Shipping

4. Processing and provision of clear water for public purpose

5. Public railway service

6. Atomic power plants

7. Medical services, covering the building and operation of hospitals, medical check-ups, clinical laboratories, mental rehabilitation service, public health maintenance security, rent of medical equipment, assistance services for health aid and evacuation of patients in emergency condition, hospital management services and services for testing, maintenance and repair of medical equipment

8. Telecommunications

9. Regular/non-regular/chartered commercial airliners
Business Field Open to Investments on Certain Conditions
Marine and Fishery Sector

1. Cultivation of fish in fresh waters
a. open to foreign investment for freshwater turtles, nila gift, sidat, kodok, lembu, freshwater giant shrimps and thillapya.
b. in cooperation with small-scale fishery businesses.
2. Fishing of demersal fish (big fish, grouper, and other sea fish)
- except ZEEI areas of the Malacca Strait and Arafura sea.

Industrial Sector

3. Industries of pulp made of wood
a. raw material coming from imported chips or guarantee of raw material supply from industrial timber estates (HTI).
b. other than sulfonating and/or chlorination (C12).
4. Industries of pulp made of other cellulose fibres or other materials
- other than sulfonating and chlorination (C12).
5. Chloro alkali producing industries
- other than those using mercury.
6. Processing of finished/semi finished goods of mangrove wood
- raw material coming from mangrove cultivation.
7. Money printing industry
- must secure operational licenses from BOTASUPAL-BAKIN and approval from Bank Indonesia.

8. Special printing industries (postal stamps, duty stamps, Bank Indonesia negotiable papers, passports, and stamped postal matter)
- must secure operational licenses from BOTASUPAL-BAKIN.

9. Milk processing industry (powder and sweetened condensed milk)
- processing, not merely repacking.

10. Plywood and rotary veneer industries
- only for Irian Jaya province (Papua).

11. Sawn timber industries
a. only for Irian Jaya province (Papua).
b. outside Irian Jaya province (Papua), only using logs from non-natural forests.

12. Ethyl alcohol industries
- technical grade, being only used as raw materials and auxiliary
materials of other industries.

13. Industries of raw materials for explosives (ammonium nitrates)
- must be in cooperation with business entities securing recommendation from the Ministry of Defense.

14. Industries of explosives and components for industrial (commercial) needs
a. must be in cooperation with business entities securing recommendation from the Ministry of Defense.
b. only manufacturing activities, while storage and distribution are executed by companies appointed by the government.

15. Electricity planning and supervision consulting services.
Open to foreign investment with the provisions that:
a. PLTA (hydro power plant) with a capacity of above 50 MW.
b. PLTU (steam power plant) with a capacity of above 100 MW.
c. PLTP (geothermal power plant) with a capacity of above 55 MW.
d. main electrical relay station with a voltage of above 500 KV.
e. transmission networks with a voltage of above 500 KV.

16. Electricity equipment construction, maintenance, installation services, development of technology supporting the supply of electricity and testing of electricity installations.
Open to foreign investments with the provisions that:
a. main electrical relay stations with a voltage of above 500 KV.
b. transmission networks with a voltage of above 500 KV.

17. Petroleum and natural gas drilling services
Open to foreign investments with the provisions that:
a. only for offshore drilling.
b. especially for locations outside the Eastern Indonesian Region, must cooperate with national partners operating in the similar business field.

18. Power plant businesses
- open to locations outside Java, Bali and Madura.

Trading Sector

19. Restaurants
- open to foreign investments with the special provisions that they must be located in tourism areas/zones and/or integrated with hotels.

20. Games services
- open to foreign investments with the special provisions that they must be located in tourism areas/zones and/or integrated with hotels.

Macro Economic

2007-03-06T12:25:00.000-08:00

Positif and Negatif/Normatif Economic
Positif economic is corcerned with what is.
or concerned with the utilization of means or resources for the advancement of economic goods.
Normatif economic is corcerned with what ought to be.
or concerned about what economic conciders thing as they ought to be and its discussed the desiribility to be achieved.

Economic Classification
Positif Economic or Economic Theory or economic Analysist --> Concerned of thing as the are.
Normatif Economic or Presciptive Economic --> Concerned with the thing as the ought to be.
Practical Economic --> Concerned with the Methods or Means or realising economic ideals.
Economic History --> Study of Economic Phenomena existing at any given period in the past.
History of Economic Thought --> Study of the the history of the analysist or scientific of economic science itself.

Deductive Methods
A study a proceed from from reasoning to a study of the past and verification of conclusions arrived at. and it also known as Hypothetical Methodes, because some of sapposation and assumption may not correspond to actual facts but near to actual facts. that may be used as premises for reasoning and deriving conclusion and its also call as Abstract Methodes, because the problem it simplified, removing all irrelevant facts.

* Advantage of Deduction Methode's

- Its lead to correct conclusions provided the premises from which the reasoning proceed are correct.
- Its only drawn back the conclusion derived though the deductive methods can have only a limited application because economic are continually changing.

* Advantage of Inductive Methode's

- The methods of statiscal induction is indispensable for the formation of economic policy.
- The economic laws which are arrived at by process of induction leads to precise exact measurable conclusion.
Some of the important theory have been discovered as a result of use of induction.
- It's used to check and verify the conclusion of deduction to bring the light deficiencies in their treatment and to amplify their conclusion.
- The chief merit of Inductive methods is to show the complexity of economic phenomena and the imposibility of deriving conclusion and principle which would have numerial application.

Defination of Economic
1. Wealth Defination
2. Welfare Defination
3. Scarcity Defination
4. Growth Defination
Scarcity Defination as Prof. Robbins said" Economic is the science which studies human behaviour as a relationship between end and scace mean which have alternative used.

Pricing
1. Pricing of Good
2. Pricing of Factor Production
3. Factor of Production

Land --> The price of the used land is known as --> Land Rent
Labour --> The price for labour is call as --> A Wage
Capital --> The price for the sources of capital is --> Interest
Organization --> The price for services of the organizer is call as --> Profit

Trading Valas/Forex Trading Dalam Perspektif Islam

2006-09-28T05:18:00.000-07:00

Sebagian umat Islam meragukan kehalalan praktik perdagangan berjangka. Bagaimana menurut padangan para pakar Islam?
Jangan engkau menjual sesuatu yang tidak ada padamu," sabda Nabi Muhammad SAW, dalam sebuah hadits riwayat Abu Hurairah.

Oleh sementara fuqaha (ahli fiqih Islam), hadits tersebut ditafsirkan secara saklek. Pokoknya, setiap praktik jual beli yang tidak ada barangnya pada waktu akad, haram. Penafsiran secara demikian itu, tak pelak lagi, membuat fiqih Islam sulit untuk memenuhi tuntutan jaman yang terus berkembang dengan perubahan-perubahannya.

Karena itu, sejumlah ulama klasik yang terkenal dengan pemikiran cemerlangnya, menentang cara penafsiran yang terkesan sempit tersebut. Misalnya, Ibn al-Qayyim. Ulama bermazhab Hambali ini berpendapat, bahwa tidak benar jual-beli barang yang tidak ada dilarang. Baik dalam Al Qur’an,sunnah maupun fatwa para sahabat, larangan itu tidak ada.

Dalam Sunnah Nabi, hanya terdapat larangan menjual barang yang belum ada, sebagaimana larangan beberapa barang yang sudah ada pada waktu akad. “Causa legis atau ilat larangan tersebut bukan ada atau tidak adanya barang, melainkan garar,” ujar Dr. Syamsul Anwar, MA dari IAIN SUKA Yogyakarta menjelaskan pendapat Ibn al-Qayyim. Garar adalah ketidakpastian tentang apakah barang yang diperjual-belikan itu dapat diserahkan atau tidak. Misalnya, seseorang menjual unta yang hilang. Atau menjual barang milik orang lain, padahal tidak diberi kewenangan oleh yang bersangkutan.

Jadi, meskipun pada waktu akad barangnya tidak ada, namun ada kepastian diadakan pada waktu diperlukan sehingga bisa diserahkan kepada pembeli, maka jual beli tersebut sah. Sebaliknya, kendati barangnya sudah ada tapi - karena satu dan lain hal — tidak mungkin diserahkan kepada pembeli, maka jual beli itu tidak sah.

Perdagangan berjangka, jelas, bukan garar. Sebab, dalam kontrak berjangkanya, jenis komoditi yang dijual-belikan sudah ditentukan. Begitu juga dengan jumlah, mutu, tempat dan waktu penyerahannya. Semuanya berjalan di atas rel aturan resmi yang ketat, sebagai antisipasi terjadinya praktek penyimpangan berupa penipuan — satu hal yang sebetulnya bisa juga terjadi pada praktik jua-beli konvensional.

Dalam perspektif hukum Islam, Perdagangan Berjangka Komoditi (PBK) (forex adalah bagian dari PBK) dapat dimasukkan ke dalam kategori almasa’il almu’ashirah atau masalah-masalah hukum Islam kontemporer. Karena itu, status hukumnya dapat dikategorikan kepada masalah ijtihadiyyah. Klasifikasi ijtihadiyyah masuk ke dalam wilayah fi ma la nasha fih, yakni masalah hukum yang tidak mempunyai referensi nash hukum yang pasti.

Dalam kategori masalah hukum al-Sahrastani, ia termasuk ke dalam paradigma al-nushush qad intahat wa al-waqa’I la tatanahi. Artinya, nash hukum dalam bentuk Al-Quran dan Sunnah sudah selesai; tidak lagi ada tambahan. Dengan demikian, kasus-kasus hukum yang baru muncul mesti diberikan kepastian hukumnya melalui ijtihad.

Dalam kasus hukum PBK, ijtihad dapat merujuk kepada teori perubahan hukum yang diperkenalkan oleh Ibn Qoyyim al-Jauziyyah. Ia menjelaskan, fatwa hukum dapat berubah karena beberapa variabel perubahnya, yakni: waktu, tempat, niat, tujuan dan manfaat. Teori perubahan hukum ini diturunkan dari paradigma ilmu hukum dari gurunya Ibn Taimiyyah, yang menyatakan bahwa a-haqiqah fi al-a’yan la fi al-adzhan. Artinya, kebenaran hukum itu dijumpai dalam kenyataan empirik; bukan dalam alam pemikiran atau alam idea.

Paradigma ini diturunkan dari prinsip hukum Islam tentang keadilan yang dalam Al Quran digunakan istilah al-mizan, a-qisth, al-wasth, dan al-adl.

Dalam penerapannya, secara khusus masalah PBK dapat dimasukkan ke dalam bidang kajian fiqh al-siyasah maliyyah, yakni politik hukum kebendaan. Dengan kata lain, PBK termasuk kajian hukum Islam dalam pengertian bagaimana hukum Islam diterapkan dalam masalah kepemilikan atas harta benda, melalui perdagangan berjangka komoditi dalam era globalisasi dan perdagangan bebas.

Realisasi yang paling mungkin dalam rangka melindungi pelaku dan pihak-pihak yang terlibat dalam perdagangan berjangka komoditi dalam ruang dan waktu serta pertimbangan tujuan dan manfaatnya dewasa ini, sejalan dengan semangat dan bunyi UU No. 32/1977 tentang PBK.

Karena teori perubahan hukum seperti dijelaskan di atas, dapat menunjukkan elastisitas hukum Islam dalam kelembagaan dan praktek perekonomian, maka PBK dalam sistem hukum Islam dapat dianalogikan dengan bay’ al-salam’ajl bi’ajil.
Bay’ al-salam dapat diartikan sebagai berikut. Al-salam atau al-salaf adalah bay’ ajl bi’ajil, yakni memperjualbelikan sesuatu yang dengan ketentuan sifat-sifatnya yang terjamin kebenarannya. Di dalam transaksi demikian, penyerahan ra’s al-mal dalam bentuk uang sebagai nilai tukar didahulukan daripada penyerahan komoditi yang dimaksud dalam transaksi itu. Ulama Syafi’iyah dan Hanabilah mendefinisikannya dengan: “Akad atas komoditas jual beli yang diberi sifat terjamin yang ditangguhkan (berjangka) dengan harga jual yang ditetapkan di dalam bursa akad”.

Keabsahan transaksi jual beli berjangka, ditentukan oleh terpenuhinya rukun dan syarat sebagai berikut :

Rukun sebagai unsur-unsur utama yang harus ada dalam suatu peristiwa transaksi Unsur-unsur utama di dalam bay’ al-salam adalah:
Pihak-pihak pelaku transaksi (‘aqid) yang disebut dengan istilah muslim atau muslim ilaih.Objek transaksi (ma’qud alaih), yaitu barang-barang komoditi berjangka dan harga tukar (ra’s al-mal al-salam dan al-muslim fih).Kalimat transaksi (Sighat ‘aqad), yaitu ijab dan kabul. Yang perlu diperhatikan dari unsur-unsur tersebut, adalah bahwa ijab dan qabul dinyatakan dalam bahasa dan kalimat yang jelas menunjukkan transaksi berjangka. Karena itu, ulama Syafi’iyah menekankan penggunaan istilah al-salam atau al-salaf di dalam kalimat-kalimat transaksi itu, dengan alasan bahwa ‘aqd al-salam adalah bay’ al-ma’dum dengan sifat dan cara berbeda dari akad jual dan beli (buy).

Syarat-syarat

Persyaratan menyangkut objek transaksi, adalah: bahwa objek transaksi harus memenuhi kejelasan mengenai: jenisnya (an yakun fi jinsin ma’lumin), sifatnya, ukuran (kadar), jangka penyerahan, harga tukar, tempat penyerahan.
Persyaratan yang harus dipenuhi oleh harga tukar (al-tsaman), adalah, Pertama, kejelasan jenis alat tukar, yaitu dirham, dinar, rupiah atau dolar dsb atau barang-barang yang dapat ditimbang, disukat, dsb. Kedua, kejelasan jenis alat tukar apakah rupiah, dolar Amerika, dolar Singapura, dst. Apakah timbangan yang disepakati dalam bentuk kilogram, pond, dst.

Kejelasan tentang kualitas objek transaksi, apakah kualitas istimewa, baik sedang atau buruk. Syarat-syarat di atas ditetapkan dengan maksud menghilangkan jahalah fi al-’aqd atau alasan ketidaktahuan kondisi-kondisi barang pada saat transaksi. Sebab hal ini akan mengakibatkan terjadinya perselisihan di antara pelaku transaksi, yang akan merusak nilai transaksi.

Kejelasan jumlah harga tukar. Penjelasan singkat di atas nampaknya telah dapat memberikan kejelasan kebolehan PBK. Kalaupun dalam pelaksanaannya masih ada pihak-pihak yang merasa dirugikan dengan peraturan perundang-undangan yang ada, maka dapatlah digunakan kaidah hukum atau legal maxim yang berbunyi: ma la yudrak kulluh la yutrak kulluh. Apa yang tidak dapat dilaksanakan semuanya, maka tidak perlu ditinggalkan keseluruhannya.

Dengan demikian, hukum dan pelaksanaan PBK sampai batas-batas tertentu boleh dinyatakan dapat diterima atau setidak-tidaknya sesuai dengan semangat dan jiwa norma hukum Islam, dengan menganalogikan kepada bay’ al-salam.

Dihimpun dari berbagai sumber

The Law of Large Number

2006-07-26T04:06:00.000-07:00

The weak law
The weak law of large numbers states that if X1, X2, X3, ... is an infinite sequence of random variables, where all the random variables have the same expected value μ and variance σ2; and are uncorrelated (i.e., the correlation between any two of them is zero), then the sample average

converges in probability to μ. Somewhat less tersely: For any positive number ε, no matter how small, we have Proof
Chebyshev's inequality is used to prove this result. Finite variance (for all i) and no correlation yield that

The common mean μ of the sequence is the mean of the sample average:

Using Chebyshev's inequality on results in

This may be used to obtain the following:
\varepsilon) \geq 1 - \operatorname{P}( \left \overline{X}_n-\mu \right \geq \varepsilon) \geq 1 - \frac{\sigma^2}{\varepsilon^2 n}." src="http://upload.wikimedia.org/math/c/f/0/cf0f931a740cc836d2a94a48cacfa27a.png">
As n approaches infinity, the expression approaches 1.
Proof ends here
The result holds also for the 'infinite variance' case, provided the Xi are mutually independent and their (finite) mean μ exists.
A consequence of the weak law of large numbers is the asymptotic equipartition property.
[edit]

The strong law
The strong law of large numbers states that if X1, X2, X3, ... is an infinite sequence of random variables that are pairwise independent and identically distributed with E(Xi) < ∞ (and where the common expected value is μ), then

i.e., the sample average converges almost surely to μ.
If we replace the finite expectation condition with a finite second moment condition, E(Xi2) < ∞ (which is the same as assuming that Xi has variance), then we obtain both almost sure convergence and convergence in mean square. In either case, these conditions also imply the consequent weak law of large numbers, since almost sure convergence implies convergence in probability (as, indeed, does convergence in mean square).
This law justifies the intuitive interpretation of the expected value of a random variable as the "long-term average when sampling repeatedly".

A weaker law and proof
Proofs of the above weak and strong laws of large numbers are rather involved. The consequent of the slightly weaker form below is implied by the weak law above (since convergence in distribution is implied by convergence in probability), but has a simpler proof.
Theorem. Let X1, X2, X3, ... be a sequence of random variables, independent and identically distributed with common mean μ < ∞, and define the partial sum Sn := X1 + X2 + ... +Xn. Then, Sn / n converges in distribution to μ.
Proof. (See [1], p. 174) By Taylor's theorem for complex functions, the characteristic function of any random variable, X, with finite mean μ, can be written as

Then, since the characteristic function of the sum of independent random variables is the product of their characteristic functions, the characteristic function of Sn / n is

The limit eitμ is the characteristic function of the constant random variable μ, and hence by the Lévy continuity theorem, Sn / n converges in distribution to μ. Note that the proof of the central limit theorem, which tells us more about the convergence of the average to μ (when the variance σ 2 is finite), follows a very similar approach.

Takaful (Islamic Insurance)

2006-07-26T04:00:00.000-07:00

In modern business, one of the ways to reduce the risk of loss due to misfortunes is through insurance. The basic idea behind insurance is the sharing of risk. The concept of insurance where resources are pooled to help the needy does not contradict Shariah.

Conventional insurance involves the elements of uncertainty (Al-gharar) in the contract of insurance, gambling (Al-maisir) as the consequences of the presence of uncertainty and interest (Al-riba) in the investment activities of the conventional insurance companies which contravene the rules of Shariah. It is generally accepted by Muslim Jurists that the operation of conventional insurance does not conform to the rules and requirements of Shariah.

Takaful is an alternative form of cover which a Muslim can avail himself against the risk of loss due to misfortunes. The concept of takaful is not a new concept, in fact it had been practised by the Muhajrin of Mecca and the Ansar of Medina following the hijra of the Prophet over 1400 years ago.

Takaful is based on the idea that what is uncertain with respect to an individual may cease to be uncertain with respect to a very large number of similar individuals. Insurance by combining the risks of many people enables each individual to enjoy the advantage provided by the law of large numbers.

__________________________________________________________________________________
* Law of Large Number "In a statistical context, laws of large numbers imply that the average of a random sample from a large population is likely to be close to the mean of the whole population.

In probability theory, several laws of large numbers say that the average of a sequence of random variables with a common distribution converges (in the senses given below) to their common expectation, in the limit as the size of the sequence goes to infinity. Various formulations of the law of large numbers, and their associated conditions, specify convergence in different ways.

When the random variables have a finite variance, the central limit theorem extends our understanding of the convergence of their average by describing the distribution of the standardised difference between the sum of the random variables and the expectation of this sum. Regardless of the underlying distribution of the random variables, this standardized difference converges in distribution to a standard normal random variable.

The phrase "law of large numbers" is also sometimes used to refer to the principle that the probability of any possible event (even an unlikely one) occurring at least once in a series increases with the number of events in the series. For example, the odds that you will win the lottery are very low; however, the odds that someone will win the lottery are quite good, provided that a large enough number of people purchased lottery tickets.

Principles in Islamic Banking

2006-07-26T03:52:00.000-07:00

Islamic banking has the same purpose as conventional banking except that it claims to operate in accordance with the rules of Shariah, known as Fiqh al-Muamalat (Islamic rules on transactions). The basic principle of Islamic banking is the sharing of profit and loss and the prohibition of riba´ (interest). Amongst the common Islamic concepts used in Islamic banking are profit sharing (Mudharabah), safekeeping (Wadiah), joint venture (Musharakah), cost plus (Murabahah) and leasing (Ijarah).
In an Islamic mortgage transaction, instead of loaning the buyer money to purchase the item, a bank might buy the item itself from the seller, and re-sell it to the buyer at a profit, while allowing the buyer to pay the bank in installments. However, the fact that it is profit cannot be made explicit and therefore there are no additional penalties for late payment. In order to protect itself against default, the bank asks for strict collateral. The goods or Land is registered to the name of the buyer from the start of the transaction. This arrangement is called Murabaha. Another approach is Ijara wa Iqtina, which is similar to real estate leasing. Islamic banks handle loans for vehicles in a similar way (selling the vehicle at a higher-than-market price to the debtor and then retaining ownership of the vehicle until the loan is paid).
There are several other approaches used in business deals. Islamic banks lend their money to companies by issuing floating rate interest loans. The floating rate of interest is pegged to the company's individual rate of return. Thus the bank's profit on the loan is equal to a certain percentage of the company's profits. Once the principal amount of the loan is repaid, the profit-sharing arrangement is concluded. This practice is called Musharaka. Further, Mudaraba is venture capital funding of an entrepreneur who provides labor while financing is provided by the bank, so that both profit and risk are shared. Such participatory arrangements between capital and labor reflect the Islamic view that the borrower must not bear all the risk/cost of a failure, as it is Allah who determines that failure, and intends that it fall on all those involved.
Last, Islamic banking is restricted to Islamically acceptable deals, which exclude those involving alcohol, pork, gambling, etc. Thus ethical investing is the only acceptable form of investment, and moral purchasing is encouraged.
Islamic banks have grown recently in the Muslim world but are a very small share of the global banking system. Micro-lending institutions such as Grameen Bank use conventional lending practices, and are popular in some Muslim nations, but are clearly not Islamic banking.
In theory, Islamic banking should be synonymous with full-reserve banking, with banks achieving a 100% reserve ratio [2]. However in practice this is rarely the case

Islamic Development Bank (IDB)

2006-07-26T03:40:00.000-07:00

THE Islamic Development Bank (IDB) is an international financial institution established in accordance with the Declaration of Intent issued by the Conference of Finance Ministers of Muslim countries held in Jeddah in Dhul Q'adah 1393H (1973).

The inaugural meeting of the Board of Governors took place in Rajab 1395H, corresponding to July 1975. The bank formally opened on 15 Shawwal 1395H corresponding to Oct 20, 1975.

The primary purpose of the bank is to foster the economic development and social progress of member countries and Muslim communities in non-member countries, individually as well as jointly, in accordance to the principles of syariah i.e. Islamic law. The present membership of the bank consists of 53 countries.

As the only multilateral development banking institution that operates wholly according to the principles of syariah the membership of the bank covers countries in the continents of Africa, Asia, Europe, the Middle East and Latin America.

The basic condition for membership is that the prospective member country should be a member of the Organisation of the Islamic Conference, pay its contribution to the capital of the bank and be willing to accept such terms and conditions as might be decided by the IDB Board of Governors.

The principal functions assigned to the bank are to participate in equity capital and to grant loans for productive projects and enterprises besides providing financial assistance to member countries in other forms for economic and social development.

The bank is also required to establish and operate special funds for specific purposes including a fund for assistance to Muslim communities in non?member countries, in addition to setting up trust funds.

It is also charged with the responsibility of assisting in the promotion of foreign trade, especially in capital goods, among member countries; providing technical assistance; and extending training facilities for personnel engaged in development activities in member countries to conform to syariah.

The IDB had to pursue these objectives in a vacuum so to speak as there was no Islamic bank at the time of its inception to serve as a model. Nonetheless, in the relatively short period of its existence, the bank has made considerable progress in several areas.

The current authorised capital of the bank is six billion Islamic dinars and its subscribed capital increased to four billion Islamic diners payable according to specific schedules and in freely convertible currency acceptable to the Bank.

Money and capital markets
The flow of financial resources from Muslim countries in the beginning to conventional financial markets was understandable since in those days Muslims did not have a viable global Islamic financial system as an alternative to the conventional system.

The dearth of financial instruments has led to serious liquidity management problems for Islamic. financial institutions and has curtailed the development of a global Islamic financial market

Thus, the establishment of an international Islamic financial market is not only necessary but need to be implemented on an urgent basis. Such a market will provide an avenue for efficient management of Islamic assets and liabilities at the international level.

The IDB is embarking, jointly with a working group comprising the central banks and monetary authorities of some member countries, on the development of an International Islamic Financial Market (IIFM) to serve the urgent need of member countries for an efficient cost effective and more business?friendly financial intermediary. It is expected to help attract capital inflows that are necessary for development in IDB member countries.

A main goal of the IIFM will be to create an interactive framework for cooperation world?wide among different market players with varying needs to help deepen the Islamic financial market and make it more competitive, convenient and accessible to all.

This should help strengthen the architecture of the international financial system by its twin characteristics: it will be complementary to conventional banking and finance where the latter is compatible with syariah principles of fairness in sharing risk/rewards by all market players, and will provide a more business?friendly alternative to conventional finance where the syariah principles are not observed.

Islamic Inter-bank Money Market

2006-07-26T03:33:00.000-07:00

The Islamic inter-bank money market (IIMM) was introduced on January 3, 1994 as a short-term intermediary to provide a ready source of short-term investment outlets based on Syariah principles. Through the IIMM, the Islamic banks and banks participating in the SPI would be able to match their funding requirements effectively and efficiently. BNM issued the Guidelines on the IIMM on December 18, 1993 to facilitate proper implementation of the IIMM.
The IIMM covers the following aspects:-
Interbank trading of Islamic financial instruments; and
Mudharabah Interbank Investments ("MII")

Only Islamic banks, commercial banks, merchant banks and eligible finance companies and discount houses are allowed to participate in the IIMM.

Interbank trading
Eligible banking institutions are allowed to trade in the designated Islamic financial instruments, such as Islamic accepted bills and Islamic debt securities among themselves. GIC are non-tradable but the players may exchange the papers among themselves based on the price issued by BNM.

Mudharabah interbank investments (MII)
MII refers to a mechanism whereby a deficit Islamic banking institution (‘investee bank”) can obtain investment from a surplus Islamic banking institution (“investor bank”) based on Mudharabah (profit-sharing). The period of investment is from overnight to 12 months, while the rate of return is based on the rate of gross profit before distribution for investments of 1-year of the investee bank. The profit-sharing ratio is negotiable among both parties. The investor bank at the time of negotiation would not know what the return would be, as the actual return will be crystallised towards the end of the investment period. The principal invested shall be repaid at the end of the period, together with a share of the profit arising from the used of the fund by the investee bank. Beginning February 2, 1996, BNM introduced the minimum benchmark rate for the MII i.e. the prevailing rate of the Government Investment Issues plus a spread of 0.5 per cent. The purpose of the benchmark rate is to ensure that only banks with reasonable rate returns participate in the MII.

Concepts of Islamic Banking

2006-07-26T03:11:00.000-07:00

01.Wadiah Yad Dhamanah (savings with guarantee)
Refers to goods or deposits, which have been deposited with another person, who is not the owner, for safekeeping. As wadiah is a trust, the depository becomes the guarantor and, therefore guarantees repayment of the whole amount of the deposits, or any part thereof, outstanding in the account of depositors, when demanded. The depositors are not entitled to any share of the profits but the depository may provide returns to the depositors as a token of appreciation.

02. Mudharabah (profit-sharing)
Refers to an agreement made between a capital provider and another party (entrepreneur), to enable the entrepreneur to carry out business projects, based on a profit sharing basis, of a pre-agreed ratio. In the case of losses, the losses are borne by the provider of the funds.

03. Musyarakah (joint venture)
Refers to a partnership or joint venture for a specific business, whereby the distribution of profits will be apportioned according to an agreed ratio. In the event of losses, both parties will share the losses on the basis of their equity participation.

04. Murabahah (cost plus)
Refers to the sale of goods at a price, which includes a profit margin as agreed to by both parties. Such sales contract is valid on the condition that the price, other costs and the profit margin of the seller are stated at the time of the agreement of sale.

05. Bai’ Bithaman Ajil (deferred payment sale)
Refers to the sale of goods on a deferred payment basis at a price, which includes a profit margin agreed to by both parties.

06. Bai’ al-Dayn (debt trading)
Refers to debt financing, i.e. the provision of financial resources required for production, commerce and services by way of sale/purchase of trade documents and papers. Only documents evidencing real debts arising from bona fide merchant transactions can be traded.

07. Bai’ al-Inah
The financier sells an asset to the customer on a deferred payment and then the financier immediately repurchases the asset for cash at a discount.

08. Al-Ijarah Thumma al-Bai’ (leasing and subsequently purchase)
Refers to a Al-Ijarah (leasing/renting) contract to be followed by Al-Bai (purchase) contract. Under the first contract, the hirer leases the goods from the owner at an agreed rental over a specified period. Upon expiry of the leasing period, the hirer enters into a second contract to purchase the goods from the owner at an agreed price.

09. Ijarah (leasing)
Refers to an arrangement under which the lessor leases equipment, building or other facility to a client at an agreed rental against a fixed charge, as agreed by both parties.

10. Qardhul Hassan (benevolent loan)
Refers to an interest free loan. The borrower is only required to repay the principal amount borrowed, but he may pay an extra amount at his absolute discretion, as a token of appreciation.

11. Bai’ as-Salam (future delivery)
Refers to an agreement whereby payment is made in advance for delivery of specified goods in the future.

12. Bai’ al-Istijrar (supply contract)
Refers to an agreement between the client and the supplier, whereby the supplier agrees to supply a particular product on an on going basis, for example monthly, at an agreed price and on the basis of an agreed mode of payment.

13. Kafalah (guarantee)
Refers to a contract of guarantee by the contracting party or any third party to guarantee the performance of the contract terms by contracting parties.

14. Rahnu (collateralised borrowing)
Refers to an arrangement whereby a valuable asset is placed as collateral for debt. The collateral may be disposed in the event of default.

15. Wakalah (nominating another person to act)
Refers to a situation, where a person nominates another person to act on his behalf.

16. Hiwalah (remittance)
Refers to a transfer of funds/debt from the depositor’s/debtor’s account to the receiver’s/creditor’s account whereby a commission may be charged for such service.

17. Sarf (foreign exchange)
Refers to the buying and selling of foreign currencies.

18. Ujr (fee)
Refers to commissions or fees charged for services.

19. Hibah (gift)
Refers to gifts award voluntarily in return for loan given.

Were Are We Came From? – Africa –

2006-07-12T06:15:00.000-07:00

Struggle for Existence

Among the various groups of primitive people that Africa is home to the African Bushmen have inhabited the Dark Continent for at least 20.000 years. Basically hunter, the Kalahari deserts is their home ground.
They live simple life, where finding food forms their occupation. They build temporary homes in the desert as they go in search of wood and food. The Bushmen tribe is spread far beyond South Africa into Namibia, Angola, Botswana, Zambia, Lesotho and Mozambique. Once spread over the whole of the Kalahari deserts, the Bushmen are now forced to stay in the places unsuitable for hunting and gathering. This began with the colonization of Africa by the European in the last few hundreds years. The tribals have been facing eviction from their ancestral lands, and oppression amounting to a massive though unspoken genocide. This has reduced them in numbers, from several million to just about 100.000. The organization of the Bushmen tribe is very simple – without a chief or paramount leader. Their primary weapon is a bow made of a stout bough bent into a sharp curve mixed with the venom of snakes.

Bushmen ear practically anything. The meat they consume is half cooked. They also eat raw insect like lice and ants, the eggs of the latter being regarded as a great delicacy. In hard times, they eat lizards, snakes, frogs, worms and caterpillars. That they are different from other tribes is evident from their appearance. The tallest man in the community would be no more that 4 feet 9 inches and the tallest women are about four feet. Unlike other tribes, Bushmen rear no domestic animals. Their unique lives have become their nemesis. They all suffer from perception that their lifestyle is ‘primitive’ and that they need to be ‘civilised’.
In Botswana the Government forced most all the Bushmen off the central Kalahari Game Reserve. The harassment began in 1986, and the first forced removals were in 1997. Those that remained, faced torture, drastic restriction in their hunting rights, and routine harassment. In early 2002, this harassment intensified, accompanied by the destruction of the Bushmen’s water pump, the draining of their existing water supplies into the desert, and the banning of hunting and gathering. Almost all were forced out by these tactics. The Bushmen are now miserable resettlement camps, unable to hunt or gather and dependent on government handouts and support.
Like the Bushmen, many tribes that are ‘different’ face similar problems. Pygmies have their own settlement in the forests and retreat into them, avoiding roads entirely. But, governments want them to stay in the villages along the road, where they can be counted and made to pay taxes. Their way of life is seen as alien and one that needs to be ‘corrected’.
A natural way of living that these people know, is slowly vanishing in the tides of development.

Sunday, Vijay Times – Bangalore. 02 July 2006

Were Are We Came From? – India –

2006-07-12T06:14:00.000-07:00

Match of Unequal

Days after Tsunami of December 2004, a muscular, naked man on one of tiny island of Andamans, threatened a helicopter hovering above with drawn bow and arrow. For millions of people who watched him on TV, the threat perhaps looked comical.
But for this indigenous man of North sentinel Island, however, and for hundreds of other man, women and children hiding from civilization in deep jungles and remote islands around the world, hostility to other humans is necessary for survival itself. When a tribe has long live is isolation, contact with a dominant culture usually means decline – and somehow the invisible people know it.
Many such indigenous tribes are found in Andaman and Nicobar islands. The sole inhabitants of North sentinel Island, the sentinelese, are one of the most isolated and least known human tribes in the world today. They are a true hunting – gathering society with considerable reliance on sea resources. The estimates of the population of these tribes is between 80 to 100. they have rejected outsiders for centuries. Until recently they didn’t even know the use of fire.

Various aboriginals have occupied these islands for an upward of 60.000 years. They killed almost everyone who landed on their shores, apparently in the belief that ‘sea spirit’ – sailor – savored human flesh. But for them problems began in 1857. The British colonized the islands, effortlessly defeated “10 tribes of savages” and pacified them by fostering craving for tobacco and alcohol. Because the islander had no immunity to the killer germs that breed in close – packed society, they began to fall prey immediately to epidemics. Of the perhaps 8.000 members of the original 10 tribes, only 45 or so individual still survive. Most of the man alcoholic, while the women have affairs with outsiders, whose lighter skin and straighter hair they hope to bestow their offspring.

Dispossessed by civilization: Isolated people are particularly vulnerable to dispossession. Consider the Jarawa, another Andaman tribe whose enmity with all other had spared it the 19th Century epidemics. Because the Jarawa resisted the felling of their forests, armed police hunted and shot them throughout the first half of the 20th Century. In the 1950s, after the Andaman Island had passed to India, authorities settled thousands of people near Jarawa jungle, and, when clashes ensued, revived the century old participation strategy. Every month, for decade, officials and anthropologists left gift on Jarawa beaches, eventually managing to create a taste for thing such as red cloth and rice.
The Jarawa who had been free of even the common cold began to die of pneumonia, bronchitis, measles, mumps and malaria. Jarawa now number around 300. Poachers have overrun their territory, while others have introduced addictions to force the nomads to barter jungle produce.

III-Conceived plans: The Onge community is one of the four Negrito tribal communities that still survive in the Andaman Islands. Its population today is around a hundreds individuals; the 732 sq km of the thickly forested island of little Andaman is the only area they inhabit.
The community is on the brink of extinction. The Onge community had flourished in the Andaman Islands for centuries. Not much is known about the community, but whatever is known is proof enough of the astonishing depth and diversity of its knowledge. The story of the Onge people’s alienation started in the late 1960s, when the government of India planned a massive development and colonization programme. Thousands of outsiders were settled in Little Andaman. The settler population grew rapidly; from a few hundreds in the 1960s to 7.000 in 1984 and over 12.000 in 1991, displacing Onges from some of their most preferred habitats.
Attempts were made to introduce a cash economy in the community, which did not have even a barter system. III-conceived schemes, such as the raising of coconut plantation (in which Onge people were made workers), cattle-rearing (the community does not consume milk) and pig-breeding, were introduced. All of them failed.
It is clear now that the survival of the indigenous can only be ensured if the present policies vis-à-vis development and the tribal people are reviewed with sensitivity. Serious attention must be paid to what the tribal people have to say and an honest attempt made, to find out what they want.

Sunday, Vijay Times – Bangalore. 02 July 2006

Were Are We Came From? - Arctic –

2006-07-12T06:12:00.000-07:00

Hunter of the Arctic

Two groups of people live in the Arctic – the Eskimos (Inupiat group) and the scientist, thought the later are later arrivals. New – age technology has found its place in the lives many Arctic people, but without the tradition knowledge of subsistence, life in Arctic is near impossible. The Inupiat are a group of Eskimo in Arctic Alaska, living mainly on Point Barrow. They, like other indigenous groups, have strong views on the earth and how it should be utilized.

A whale of a time: All Inupiat believes they have access to supernatural powers, but the Shamans are considered to be specially endowed. With the help of supernatural forces they assist in informing the whaling crew of the whales location are. Whaling is a primary occupation here. Before the whaling season, all hunters under go strict preparation and abstinence. When the four days of hunting elapse, the crew feast and then they set out on the journey.

Outside influence: when the whaling tradition expanded to include the non-Eskimos, beginning in the mid 19th Century, traditional norms were disregarded and there was excessive hunting. The dart and shoulder gun replaced traditional tools like whaling harpoon and lances. With decrease in the bowhead whale population, the walrus wan hunted. The over hunting of sea mammals resulted in starvation and even death for many Eskimos. As the whaling tradition brought more non-native people to Arctic region, Point Barrows population grew considerably, and modernization followed. The Inupiat culture, however, was only moderately influenced.
The wage economy made its presence in 1940, but traditional hunting still held high prestige. The male offered wage-job which they did not accept unless time was given off for hunting and fishing. But, in the late 70s’, restrictions were placed on bowhead whale hunting. This greatly angered the Inupiat. Arguments were made against the restrictions. Whale hunting was a human right, and no constraints should be placed by any national or international organization. The legislation was soon revoked.

Oil resources: Another problem emerged when the outsiders came to know of the rich oil resources in Arctic Alaska. The discovery of petroleum in 1967 was huge for many oil companies. Despite economic advantages there continued to be an increased risk of oil spills. If this happens, the migration course of the bowhead and other mammals would be altered and great amounts of resources would be lost.
Land ownership also heated the debate. The Inupiat strongly believe that land is something to be share and not individually owned. An agreement made in 1971, declared that approximately one-ninth of the state belonged to the natives. After 30 years of legal and political struggle for self-government, the vast Arctic land of the Canadian north has been returned to the sovereignty of the Inupiat. Since April 1999, it has been known as Nunavut, OOur Land.

The combined efforts of native Alaskans had a great impact on the future of the state. With an increasing populations, the Inupiat, in particular, have not ceased any traditional practices. Despite an amalgamation of western culture with their own, the culture identity of the Eskimos is still strong. Whaling has been a basic subsistence for them for thousands of years and continued to be so for many generations.

Sunday, Vijay Times – Bangalore. 02 July 2006

Where Are We Came From? – Australia –

2006-07-12T06:11:00.000-07:00

Down and Out

They have been around for the last 50.000 years. Recent studies have also shown that they were probably the first Homosapiens to have inhabited our planet. However, numerous factors have led to their gradual fall – their tribe is bow struggling for survival.
The term ‘Aboriginal‘ means the first or the earliest known. Until the dawn of colonialism, the Australian aboriginal lived as creative clan and had been one of the fittest enough to survive harsh climates. With the entry of the European settlers sometime during the 15th Century, these native began to be exposed to exploitation of sorts. It is said that their number was close to 300.000 in the 1700s, but it drastically reduced to a mere 30.000 in the 1930s. in place of bygone era of rich culture, strong religious and moral ground, strength and integrity, the aboriginal of today are left with nothing except poverty, poor health, low life expectancy, violent crime, racism, substance abuse, low rate of education, unemployment, etc to characterize them.

Dreamtime: There isn’t enough archaeological evidence to present a clear picture of the early Australian aboriginals. However, it has been known that they innovated many devices and traditions alike. The foundation for these indigenous lot lies in a concept knows as ‘Dreamtime’. It refers to the belief that their land had been created for them by ancestral superheroes. In fact, each element of Nature – sky, rock, tree, animal, etc – were believed to have been created during the ‘Dreamtime’. In fact, aboriginal religion and laws are based on such beliefs.
Studies have also establishes their links with Melanesian and Indonesian much before the European colonist arrived in Australia.

Read to degradation: The degradation of the Australian Aboriginals is chiefly attributed to excesses of colonialism. It was the year 1606, at the first recorded sighting of Australia, Dutch captain William Jansz described the native as “…savage, cruel, black barbarians who slew some of our sailor”. Though the Dutch government had declared the region unfit for colonization, it was gun powder that finally ruled and Australian aboriginals eventually became the colonized lot.
The natives contracted diseases, against which they had no resistance. They began losing their hunting ground, and were taken as forced labour. The settlers could punish and even kill them legally for no apparent reason. Religious conversions were imposed. Aboriginal children were taken away from their parents and put under the oft-harsh management of the church, as an attempt to bring them to follow the white society. Most of these children, referred to as the ‘stolen generation’, never got to see their parent of their families again.
It was only during World War II that about a thousand aboriginals were ‘employed’ in the military forces. In 1967, they were given the right to vote and receive state benefits like their mainstream counterparts. Protests against exploitation continued – both by the natives themselves and other who had identified themselves with their cause – and in 1972, the Australian government admitted, for the first time, the land had been taken away from the native and was right to give it back to them. Subsequently, in the year 1992, the previous legal concept of terranullius was declared invalid, which recognized the ownership of land by the natives. Though such legislations have been considered historic, their implementation remains a problem. Many aboriginals are engaged in reclaiming their lands, which is a difficult process and exposes them to more exploitation. The rate of suicide in police custody is on the rise. The aboriginals are dying young because of lifestyle factors; in fact, a 20-year study has shown that while the main stream Australians have experienced a marked increase in life expectancy at birth, that of the indigenous people is set up to 20 years lower.
Beside, cases of domestic violence are rampant; a study conducted by Australian universities has shown that one in four aboriginal women aged between 18 and 23 report some experience of domestic violence. The Australian aboriginals now number around 460.000 or 2.27 per cent of the total Australian population.

Sunday, Vijay Times – Bangalore. 02 July 2006

Giant Rock Art - America -

2006-07-12T06:10:00.000-07:00

– America –
Giant Rock Art

In the black hills of South Dakota, USA is the Mount Rushmore National Memorial. It is very large carving upon the granite face and its shows the faces of four of the greatest and most loved Presidents of the United States of America. The four American Presidents are Gorge Washington, Thomas Jefferson, Theodore Roosevelt and Abraham Lincoln.

The head of Presidents Abraham Lincoln is 18 meters tall. To demonstrate how tall this actual is, if they had proceeded to make the body of the President it would have been 142 meters tall. This amazingly huge monument was built by Gutzon Borglum. The workers who curved out the faces on Mount Rushmore used a model that one twelth of the final size for measurements. Granite is a very hard rock and the workers had to use heavy drill and explosive like dynamite to carve out the face of the cliff. The work on memorial began in 1927 and went on till 1941. The builder Gutzon Borglum died in 1941 just before the memorial was completed and his son Linson continue the work and finished the memorial soon after.

The completed memorial stands about 40 Km away from Rapid City it is about 1745 meters above the sea level and more than 150 meters above the floor of the valley, which makes it taller than the Great Pyramid of Egypt.

Gorge Washington, who is known as the ‘father’ of his country, was the first president of United State of America he commanded the army that won American independent from the British, in the American revolution. He also had the major role in writing the constitution of the United States of America

Abraham Lincoln was president of United State from 1861 to 1865. Known all over the world as the man who ended slavery in America, Lincoln is well known for the fine speeches that he gave, like the Gettysburg address.

Thomas Jefferson was the third president of the United States of America. He is known for the writing of the declaration of independent. Besides being the president he was also the scholar, lawyer, architect and inventor. He designed the Virginia Capitol and the University of Virginia. He was an ardent inventor and invented a lap desk and an improved type of plough.

Theodore Roosevelt was the president of United States of America from 1901 to 1909. He was known for his great leadership abilities and his desire to make America popular in the new world.

Thus four Presidents were chosen to constitute the Mount Rushmore National Memorial, as they are considered the four greatest Presidents of America – the men who wrought the land with their vision, hard work and dedication.

Where We Came From? – Latin America –

2006-07-12T06:08:00.000-07:00

Threatened Lives

If you happen to wander about the dense regions of the Amazon forest, you are likely to find naked people, in a community of their own, leading their lives oblivious to charms of city life. These indigenous people live close to the equator in blazing temperatures, and consider the usage of clothes a waste, a mere hindrance that poses an inconvenience. They are unperturbed by the norm of society. So simple and naïve are the ways of the indigenous people of the Amazon. But their life and their existence is being threatened by the spoils of civilization. Indigenous people comprise of only 0.02 per cent of the population in Brazil, and are isolated from main communities. Most of these tribes lives in rural areas of dense jungles, and are semi-nomadic, agricultural labourers, or hunters.
There are about 200 indigenous groups in the vast expense of the Amazon forest, each one distinct in their innate customs and beliefs, replete with a rich cultural heritage that has been passed on from generations. With such a vast repertoire of tradition, to see them fading into oblivion is not something to be brushed off as non-important.
The largest of the tribes is the Guarani (over 20.000 in number), closely followed by the Yanomani. The vast empire of these tribes can be summarized into 22 different indigenous groups have different language, and celebrate their own set of festivals, just like us.
Although the languages differ, they all interact with each other for various occasions. The total population of these groups spans 65.000 individuals. These groups keep going deeper and deeper into the forest as the outsiders get closer to where they live, and thus, not much is known about them. To stop the constant migration of tribes, it has been suggested that an indigenous protected area be setup so that they can feel secure and stop going further into the depths of the forest.

Treading a troubled path: Their population is dwindling day by day, and most of these tribes face similar problems. In Brazil, Indian land right are an inherent part of the constitution, but they have been manipulated and weakened by a new rule that has allowed non-Indians the right to challenge Indian lands. In Guyana, Indians hold the right to the title of their land, but have no right to its mineral wealth, letting government authorities auction off mining concessions. Activist in Boa Vista sat that Venezuela lags behind in recognizing Indian rights. It laws seek to assimilate indigenous people, and many attempt to give them special status is seen as a threat. The most severe effects are on the isolated indigenous tribes still living in the Brazilian, Ecuadorian and Peruvian part of the Amazon.
The Korubos of Brazil, the Tageari of Ecuador, the Ayoreo of Paraguay and the Mashco-piros, Ashaninkas and Yaminahuas of Peru, which together amount to a total of only 5.000 individuals, are on the verge of extinction, with the pressures of modern civilization encroaching their territory. What we call development, in fact is the very source of their homeland and livelihood. What’s more, most of these tribes are treated as inferior and are looked down upon, making them shun society and civilization even more.
Another tribe that is winding down the path of extinction is the Assurini, living in Brazil. Their tribe, known for their fine-crafted pottery, is reduced to just 57 members. The children amount to just seven, and the womenfolk who are responsible for the artistic tradition of pottery making, number to a mere 10. most of these tribes have their own language which is hardly found in any written form. If their art and culture are not safeguarded and recorded, they may soon disappear forever.
For hundreds of years, Brazilian Indian have been mercilessly thrown off their land by those seeking to claim its wealth for themselves. Today, this violence continues with the involvement of many more sectors of society, such as business and prospectors, who want to exploit the land’s natural resources, land owner who illegally acquire the ownership of indigenous land, logging companies, and the military, alleging national security interest, who seek to reduce and limit Indian territories in border areas. The other sources of threat are through missionaries, anthropologists and growing rage of tourism.
An example of this is what happened in the Ecuadorian Amazon when a dozen Tagaeris, of the less than 300 still alive, were massacred by Huaoranis, who now live a western lifestyle. The murders were done in view of the logging companies keen on exploiting unexplored territories.
At the time of European contact, indigenous people numbered around five million in Brazil. Ever since, these number have dwindled to less than 200.000 and anthropologists believe that a forest tribe goes extinct every years, and this has been happening since 1900. Its time that humanity realizes that these indigenous people are human, just like us, and not inferior in any way. They have rich culture heritage, and many of dying art forms are unique in their own way, which yet remain to be explored and recorded. Around 80 per cent of the world’s biodiversity is found in indigenous regions, and this it self calls for conservation acts to be implemented.

Sunday, Vijay Times – Bangalore. 02 July 2006

Where Are We Came From? – Native American –

2006-07-12T06:06:00.000-07:00

Victim of Genocide

With an estimate population of six million people, Native Americans make up two per cent of the US population. A minority of US Native Americans live on Indian reservations. In Canada, they are known as First Nations and make up approximately three per cent of the Canadian population. The US states and several of the inhabited insular areas that are not part of the continental US also contain indigenous people in the US, including the Inuit, Yupik Eskimos, and Aleuts, are not usually counted as Native Americans nor are Native Hawaiians (also known as Kanaka Maoli and Kanaka ‘Oiwi) or other Pacific Islander American people.

Initial impact: The European colonization of American changed lives and cultures of Native Americans. In the 15th to 19th Century, their populations were ravaged by displacement, disease, warfare with Europeans, and enslavement. The first Native American groups encountered by Christopher Columbus in 1492, the 250.000 to 100.000 Island Arawaks of Haiti Quisqueya, Cubanacan (Cuba) and Boriquen Puerto Rico, were enslaved. It is said that only 500 survived by the year 1550, and the groups was considered extinct before 1650. yet DNA studies show that the genetic contribution of the Taino to that region continues, and the mitochondrial DNA studies of the Taino are said to show relationship to the northern indigenous nations, such as Inuit (Eskimo) and other.
European also brought disease, against which the Native American had no immunity. Chicken pox and measles, though common and rarely fatal among European, often proved fatal to Native Americans, and more dangerous disease such as small pox were especially deadly to Native American populations. Some historians estimate that up to eight per cent of some Native populations may have died due to European diseases.

The American Revolutionary war: Frontier warfare during the American Revolution was particularly brutal, and numerous atrocities ware committed. The largest of these expeditions was the Sullivan Expedition on 1779, which destroyed more than 40 Iroquois villages, in order to neutralize Iroquois raids in upstate New York. In the 19th Century, the incessant westward expansion of the US incrementally compelled large number of Native Americans to reluctantly resettle further west.
Reformers, in effort to ‘civilise’ Indian, adapted the practice of education native children in Indian Boarding Schools. These schools proved traumatic to Native American children who were forbidden to speak their native languages, were taught Christianity instead of their native religions and were forced to abandon their various Native American identities and adopt European – American culture. There are also many documented cases of sexual, physical and mental abuses which occurred at these schools.

Current status: These are 563 federally recognized tribal governments in the US. The US recognizes the right of these tribes to self-government and support their tribal sovereignty and self determination. Limitations on tribal power of self government include the same limitation applicable to states. According to 2003 US Census Bureau estimates, a little over one third of the 2.786.652 Native American in the US live in three states: California at 413.382, Arizona at 294.137 and Oklahoma at 279.559.
As of 2000, the largest tribes in the US by population were Cherokee, Navajo, Choctaw, Sioux, Chippewa, Apache, Lumbee, Blackfeet, Iroquois, and Pueblo. In 2000, eight of 10 American with Native American ancestry were of mixed blood.
Then there are Tribal Nations that have been denied recognition such as the Muwekma Ohlone and the Miami tribe of Indiana. Many smaller eastern tribes have been trying to gain official recognition of their tribal status. The recognition confers some benefits, including the right to label arts and crafts as Native American and they can apply for grants that are specifically reserved for Native Americans.
To be established as a tribal group, members have to submit extensive genealogical proof of tribal descent, yet many Native American were denied their Native American heritage, because it would have deprived them to many rights. Gambling has become a leading industry. Casinos operated by many Native American governments generate revenue that some communities use as leverage to build diversified economies. However, most tribes feel that casinos destroy culture and do no participate in the gaming industry.

Sunday, Vijay Times – Bangalore. 02 July 2006

Where Are We Came From? - Papua New Guinea -

2006-07-12T06:05:00.000-07:00

‘Stone Age’ Tribes

The British, Germans, Dutch and Japanese had, for varying times colonized the land of New Guinea, but the tribes, some inhabiting the region for more than 40.000 years were either ignored of looked down upon as mere curiosities! Even before the arrival of the European, the tribe of this island had limited exposure to the outside world, in fact as late as 1998 two new tribes (Aukedate and Vahudate) were ‘discovered’ they were cannibals.
Hundreds of tribes have their own quaint customs with distinct languages, all part of unique Melanesian culture. The Amungme, Bauzi, Dani, Kamoro, Kombai, Korowai, Mee, Sentani and Yali are some of the well known tribes that make up the diverse riot of living history in these rainforests.

The real fascination with Guinea tribes for the outside world began with the discovery of the Korowai and Kombai, two Stone Age tribes. With their stone axes, bone knifes and wooden hammers to extract Sago – their staple diet taken from the Sago tree – Their immediately became object of scrutiny. These people were closest modern man had come to with his stone ages ancestors. Bones and wings of flying foxes, dog and pig tooth necklaces decorating their body and animal bones pierced through their noses, made them more than curiosities. The near naked people drew in a large tourist interest as well. But what got them notoriety was the fact that they practiced cannibalism. It is estimated that the Kombai number around 5.000, The Korowai about 2.500.
Tourist deluge: Pictures of Korowai and Kombai hunters armed with the bows and arrows became a prized possession for adventure tourist. The houses of these people, some times built as high as 150 feet above the ground, for protection against mosquitoes and warring tribes, were soon not too far or high enough. These indigenous people who knew nothing of the outside world became celebrities overnight. Thrill seekers, photo-journalisms, anthropologists, missionaries and anyone with a few thousand dollars to spare made ‘first contact’ with them.
On the other side of the Island (West Papua or Irian Jaya) controlled by Indonesia, rapid change is having a devastating effect on the fragile forest and people. Indonesia’s migration program has seen the over populated nation inducing its citizens to settle in the sparsely populated island with promise of land. Millions have taken up the offer.
Almost all immigrants readily find work in the timber logging. Annually, Indonesia cuts down three million acres of rainforest eating rapidly into the traditional homeland of primitive tribes. During the 1980s the Government tried its best to move the Korowai and Kombai clans into newly opened villages. The villages still remain, but the absenteeism rate is high, because of vast distance between the traditional food sources and the villages. The extreme primitive social and traditional system of the tribes makes it almost impossible for them to come to terms with modern reality in such a short time. Development projects like the construction of the world’s largest copper and gold mine has also dealt a death blow to the order of life that had survived for hundreds of generations.
The land of the ancient people has been opened up for development. This has meant little for the indigenous people. Who have viewed it as an invasion of their land, exploitation of their forests and loss of their pristine cultures.

Sunday, Vijay Times – Bangalore. 02 July 2006

Where Are We Came From? – New Zealand –

2006-07-12T05:58:00.000-07:00

Lost Innocence

There is a conflict about their origin as some historians feel that Maori people are Polynesians who actually came from Southeast Asia, while other historians feel that these people were of Polynesian origin who is came to Pacific from America. This is based on the fact their staple food crop of Kumara or sweet potato, came from South America. Moreover, there is no exact date mentioning the Polynesian settlement. It was thought to be between 950 to 1130AD but even this is debatable.
Before the European set food in the region, Maori culture had no metal tools and they relied on stone and wood. Maori culture survives as the Maoris continue to support and develop their culture on their own terms and conditions, similar to the trend elsewhere in the world.

Land wars: New Zealand’s history is pockmarked with land wars which basically were instigated when the Maori land was confiscated to such extent that the tribe’s survival was itself in jeopardy. One of the many wars that were fought was Titokowaru’s war. It was a conflict that took place in the Taranaki region of the North island of New Zealand between Wanganui and Mount Taranaki from June 1868 to March 1869. it involved the Maori tribe Ngati Ruanui and the Colonial Government of New Zealand.
After the second Taranaki war, effort to regain faith between the tribal and the government were shadowed by continual effort of confiscating land. However, when the settlers began to inhabit tribal land, few from the effected tribe of Ngati Ruanui killed three settlers. This started the war between the settlers and the Maori tribesmen. Such battles were fought among the tribal as well, to declare land supremacy and led to loss on both side.
Revival of its language: Post war years saw a decline in the usage of the Maori language, but currently, it is undergoing a renaissance, as the Maori language medium school and a Maori television channel have been set up from recommendation from the Waitangi Tribunal. It is the only nationwide television in New Zealand to have the majority of its prime time content delivered in Maori with English sub-titles. It is also tries to generate new content. However, it is unfortunate that none of the other television channels present any substantial Maori programmes, despite the fact that it is an official language equal to English.

Problem within: Among the tribes there are serious problems that affect its people. Unfortunately, as the case is every where, the outsiders brought in bad influence along with them. In the case of the Maori tribes, the European settlers brought with them leisure and entertainment activities like gambling, drinking and smoking. Interestingly, Maori is a Unique indigenous population who, prior to contact with Europeans, had no history or any traditional concepts related to gambling. They did not even have a history of brewing alcohol or consumption of tobacco. However, today these people consume these products in different social setting, like, in pubs and clubs.
Normalization of gambling has made it an integral part of this social, economic and cultural infrastructural set up of Maori and New Zealand communities. A study point out that the Maoris spend more on gambling than on education, a legacy of colonization. This despite limited income. It is noted that even though Maoris from only 10 per cent of the entire adult population they amount to at least a quarter of the people who seek professional help to rid gambling.

Sunday, Vijay Times – Bangalore. 02 July 2006

A Picture Without parallel

2006-06-26T05:27:00.000-07:00

This is the strange history of one of the largest and most beautiful paintings in the world. Believe it or not, a door was cut through it, bullets fired through it, and stones thrown. It was over painted several times and a bomb nearly destroyed it! Through ravaged by time, its exquisite life-likeness survives to this day.

Of course, it is none other than the ‘Last Supper’ by Leonardo da vinci, possibly the greatest genius the world has ever known, and the one of the best artist ever.
The 15x29 ft picture was painted on the refectory of a Dominican monastery in Milan, Known as the covenant of Santa Maria delle Grazie. Leonardo started the painting in 1495 under a contract, and completed it in 1498 – a very long time for painting. This was because of the peculiar way in which he painted. We have an eye-witness account. It is reported that Leonardo would paint for about four days without a break and without food and water. Then he would stop and study his work critically for many days, sometimes adding a single stroke to one of his figures! Then he would leave, and not be back for many days.

On returning he would again throw himself into his work, stop after a few days, hardly adding three stroke! The Dominican friars were at their wit’s end. Many people came to watch this unique artist at work, and stayed spellbound. The floor was mess of paint and stuff. Finally, the friar in charge lost his patience, and when Leonardo appeared after one of his numerous absence, asked him how long he planned to take. Leonardo then told him that he was looking for the right face to model Judas. This, he told the monk, was not an easy thing; but if he failed to find such a model, he would use the face of the man who was troubling him so much, as it perfectly suited the requirement for the face of Judas.

It is true that Leonardo studied the faces of people, dogging their footsteps until he had made the necessary sketches on which he based his painting. (These sketches – thousand of them – have been preserved, along with his notes and scientific diagram.) The depth in his painting of the Last Supper gives the impression that the room, in which Christ and his disciples were dining, was part of the large hall.

People who ate there felt they were in the ‘Upper Room’ with the disciples and their master! 1652 was the year the painting was considered completely spoilt, and a door was enlarge, cutting away a portion where Christ’s feet were. In 1726, six efforts were made to restore the painting which was flaking. They did much harm, making it dark and dull. In 1768, a curtain was hung to protect it. But this rubbed off some more flakes of paint and caused humidity to further ruin it.

In 1770 an artist was engaged to remove the over paintings. A lot more of the original was also lost. In 1796 Napoleon’s troops using the hall as an armory, shot at the figure in the painting, threw stones at them and even climbed up ladder to scratch out their eyes! Can you imagine that? And in 1943, a second world war bomb destroyed the building, but miraculously left the painting alone! (Recently a Dominican remarked that the bomb seemed to have more sense than man!)

Now with modern technology, a scientific restoration (starting in 1970) has taken place, chiefly, with the patient and skilled efforts of Dr Brambilla, she has restored the painting inch by inch with precision instrument over many years. The painting of Leonardo has been revealed, after the dust and grime and over paintings of five centuries has been removed.

Though, sadly, much of the original pigment has been lost, the rich warm colors was used by the artist can now be seen, with exquisite details that have brought out the character of each disciple. The whole concept of the picture has been revealed in all its depth and passion. Through we may never know how exactly the artist visualized the features of Jesus, for example – thanks to ravaged of time – we may stiil feel the powerful emotional impact of that precise moment in a time.

It is the moment that the artist has shown, when Jesus declared that one of the disciples sharing this meal with him would betray him. To this unexpected and shocking statement, the disciples are seen reacting, “Is it I, Lord? Is it I?” They ask, while Peter asks John (seated at the right side of the Jesus) “ Who is it of whom he speak?” John is seen in a listening attitude.

Judas is the one leaning, with elbow on the table, guilt written on his shadowed face. We see Jesus in the middle, a lonely figure. Some say this was a sign of Leonardo’s loneliness. He had no equal with whom he could share his thought, because his ideas were centuries ahead of his time!

Of late, there has been a controversy about the painting. Da Brown in his novel Da Vinci Code has crated doubts about the painter, Leonardo da Vinci as well as his chief subject, the central figure of the Last Supper, Jesus Christ. But truth, as you may have noticed, has a habit of winning.

Today, if you went to Milan and saw this painting, some thing of the passion with which Leonardo da Vinci painted will communicate it self to you. You will also feel uplifted in mind and spirit as thousand have done before.

Friday, June 23, 2006
Manorama Rathnakar
Deccan & Herald
Bangalore - India

The Story of Writing

2006-06-26T05:25:00.000-07:00

Man immortalized his thoughts when he first wrote them down. It was not easy process. He had to devise symbols to fit the sounds that he uttered and then join the symbols together to were words. His first writings were very uncompleted – tallies of sheep, taxes due, and so forth: record devised by the palace scribes of Mesopotamia who dared not to trust their memories. They were not very far removed from scratches in the dust or from the rough picture that little children make when they first learn to hold a pen.

Indian alphabet, the Roman alphabet, comes from the classical world. The world is formed from the first two syllables of Greek alpha and beta. It was long leap to the Greek alphabet from the grooves in the clay beside the river of Mesopotamia, and even longer one to the alphabets of the modern world. For instance, who discovered what the hieroglyphics of Egypt really said? The world would never have known if the archaeologists accompanying Napoleon to Egypt had not discovered the Rosetta stone in the nineteenth century.

The cuneiform writings of Mesopotamia would certainly not have been deciphered if had not been for the discovery of the stale of King Hammurabi bearing both picture symbols and words. Again, this discovery was not made till the late nineteenth and early twentieth centuries, when Flinders Petrie and Leonard Woolley went digging in Ur of the Chaldees.

In India, Among the first writing to be deciphered were the inscriptions of Asoka’ s pillars. Until 1837, no one really knew what they stood for. Effort of men such as Prinsep and Cunningham led to their translation, and opened up a fascinating world of history. The Indus valley civilization was discovered even later, In the 1920s; this script has yet to be deciphered. The Arabic and Chinese script are different from the rest since they do not belong to dead civilization. Therefore, unlike the other script, they can not be said to have been discovered. Their history is one of continual modification from the earliest form, as succeeding generation sought newer and more beautiful ways of writing the script. These modifications are fascinating, and the script hauntingly beautiful.

Until the discovery of printing in the fifteenth century, literature in Europe was handwritten by scribes in monasteries, the language used first was Latin, and then much later, French and English. The scripts used by these scribe were different in their forms. The earliest were very difficult to read. Later, during the reign of Emperor Charlemagne, a new and more legible form was involved which carried his name. Well might one marvel at the beauty that can lie in so simple a thing as a page of writing.

Friday, June 23- 2006
Christine Krishnasami
Deccan and Herald
Bangalore – India.

Balance of Payment

2006-06-26T05:11:00.000-07:00

1. Meaning and Component of Balance of Payment
Balance of Payment is a systematic record of all international economic transactions of that country during the given period. Usually a year. Or is the device for recording all the economic transactions within the given period between the resident of one country and the rest of the world (the resident of the other country). Kind of the transactions entered to the balance of payment are – international transaction, constituting the transfer of asset and liabilities, the creation or the reduction of claim or the receipt and payment of fund, which take place between the resident of one country and those of other country.
And it refer to different between the total receipt and total payment of a country over period. Balance of payment include balance of trade and balance of payment is presented in two part –
- Current account
* Trade account or Merchandise = transaction of entering good.
* Invisible account = service account or transfer payment.
- Capital account
* Private capital account
* International institution capital
* Specie account

2. Equilibrium and Disequilibrium in the Balance of Payment
A. Equilibrium

Balance of Payment represent balance in current account, capital account will always be equal if receipt and payment are equal it is equilibrium state in international trade. If there any surplus or deficit is know as disequilibrium in international trade.
B. Measure to correct the Disequilibrium
- Trade measure
- Monetary measure
- Current devaluation
- Money contraction
- Exchange control
- Foreign loan
- Encouragement to foreign investment
- Incentive to foreign tourist
- Exchange clearing agreements
A causes of the disequilibrium in the balance of payment is –
- Cyclical fluctuation
- Huge development and investment programs in the developing economic
- Due to rapid economic development
- A vast increase in the domestic production of foodstuffs, raw material, substitute good. Etc.
- A huge population and high rate of birth in poor countries.
- demonstration effect
- International borrowing and investment
- Multi-trade transaction

3. Fixed Exchange Rate and Flexible Exchange Rate
- A case for fixed exchange rate are-
- Smooth flow of international trade
- Facilities international investment
- Necessary for currency area bloc
- Remove speculation
- A case against fixed exchange rate –
- Burden on domestic income and price
- No cost price relationship
- Not based on demand and supply force
- Equilibrium in balance of payment not possible
- A case for flexible exchange rate are –
- Its doesn’t hamper the foreign trade
- Natural rate of exchange in course of time
- No hinderance in the fluctuating of currency blocs
- Its protect the domestic economic
- Based on demand and supply forces
- long-term investment are not adversely effected
- A case against flexible exchange rate –
- Serious repercussion on country’s economic
- Unwarranted international capital movement
- Hinders long term foreign investment
- encouragement to speculation

4. Foreign trade multiplier with and without foreign repercussion and determination of national income and output
The concept of foreign trade multiplier seeks to gouge the effect of a change in a country’s in foreign trade on national income and employment. According to
Kindleberger it expresses the change in income caused by a change in exports or in investment in an open economy in which income spills over into imports.
- Foreign Repercussion
There can be foreign repercussion of significant change in income abroad due to the change in export and / or imports of a given home country, which causes a backwash effect on the foreign trade and national income of home country. If, however, home country is small in relation to the outside worlds, the foreign repercussion would be insignificant. For an increase in its imports will not be stimulating income abroad to a considerable extent. Obviously, the foreign repercussion would be very influencing nature in case of large economies. In case foreign repercussion more complex formulae are required to express the foreign trade multiplier and the relationships among saving and import propensities in the countries involved.

Financial Institution and Market

2006-06-26T05:08:00.000-07:00

· Money
Money may be any commodity chosen by common consent as a medium or instrument of exchange of good and services, its widely accepted in a payment of a good and services and in settlement of debts.

· B. Money and near money
- Money in circulation consist”
a. Legal tender money à Notes, Coins.
b. Bank money or deposit withdrawable à Bank Cheque
- Near money is a certain assets which are highly liquid but not perfectly liquid as a money
Viz.”
Bill of exchange, Treasury bill, Debentures, Bond.
- Near money its also call as claim to money

· The pure meaning of finance :
Finance is the practice of manipulating and managing the money.
Finance is the capital involved in a project especially the capital that has to be raised to start a new business.
Finance is a loan of money for particular purpose especially by a finance house.

Financial system is a set of complex and closely inter-mixed financial institution, market, instrument, services, practices, procedures, etc.
Or
A set of institutional arrangement through which financial surplus ( or command over real resources ) in the economy are mobilized from surplus units and transferred to deficit spender’s.

· Main constitutional of financial system
1. Financial Assets à Bill, Bond, equities.
a. Primary/ Direct
b. Secondary/ Indirect
2. Financial Market à Currency, Cheque.
a. Functional
b. Institutional
c. Sectoral
3. Financial Institution à Financial intermediaries
a. Bank : Apex Bank
b. Non Bank : Development Bank, Investment.

· Bhole concept of financial market (1995)
a. Broad and Wide : Attract funds from inside and outside investor
b. Deep : sufficient order for buying and selling.
c. Shallow Market : Under-developed financial market

· Function of financial system
- Its help in production
- Capital Accumulation
And this is generally done through encouraging the saving and allocating fund among various alternative uses and users.
1. To facilitate creation and allocation of credit and liquidity
2. To serve as intermediaries in the process of mobilization of saving in the economy
3. To provide financial convenience to the people
4. To assist the process of economic development through a more balanced regional and sectoral distribution of investiable fund.
5. To establish a regular, smooth, efficient and cost effective link between servers and investor.
6. To improve quality and pace of economic development.

· Constituent of financial system.-
1. Financial institution
2. Financial services
3. Financial market
4. Financial instrument
5. Other.

· Function of Indian financial system
1. Accelerate the rate of economic development
2. Allocation of resources to different investment channel
3. It’s play the role of catalyst
4. Attempt to achieve the target of the plan
5. Lower risk and diversification of funds
6. Expert knowledge and professional guidance
7. Fosters industrial development
8. Investors education
9. Promotion of self –employment
10. Revival of sick units

· Role of finance system
1. Encourage saving
2. Helping hand for producer
3. Mobilization of saving
4. Capital formulation
5. Help in economic planning and development
6. Market borrowing possible
7. Globalize world economic
8. Institution
9. help in stabilizing foreign exchange rate
10. Help in international banking

· Inter-related function of Indian financial system in the modern economy (Chandra – 1997)
1. Payment system
2. Pooling of fund
3. Transfer of resources
4. Risk management
5. Price information for decentralized decision making
6. coping with information asymmetry

· Basic for managing risk
1. Hedging
2. Diversification
3. Insurance

· Measuring financial development
1. Financial ratio
2. Financial inter-relation ratio
3. New issue ratio
4. Inter-mediation ratio

· Type of risk
a. Commercial risk
b. Political risk
c. Risk arising out of foreign laws
d. Cargo risk
e. Credit risk
f. Exchange fluctuation risk

· Money market.-
Money market is a specialized market geared to cater to short term needs, dealing in this market call for specialized skill – or –
Money market is a market for short term financial assets which are near to substitute for money.

· Character of money market.-
1. Money market is basically over the phone-market. The transaction are conducted through oral communication
2. Dealing in money market may conducted with or without the help of broker
3. It’s a market for short term financial assets that are close substitute for money
4. Short term for this purpose is generally taken as a period up to one year
5. Financial assets which can be converted into money with ease
6. Money market consist of money, sub-market such as inter-bank call, money, bill rediscount, treasury bill, etc. collectively they consist the money market

· Objective of money market
1. It is provide an equilibrating mechanism for evening out short term surpluses and deficit.
2. The money market provide a focal point for the central bank intervention for influencing liquidity in the economy
3. It is provide reasonable access to users of short term money to meet their requirement at a realistic price.

· Constituent of money market –
1. Call money market
2. Collateral loan market
3. Acceptance market
4. Bill market

· Money market instruments operated in India.-
1. Monet at call and short notice (call loan)
2. Treasury bill’s
3. Gilt edged securities
4. Municipal bond
5. Commercial bill
6. Debt securitization
7. Certificate of deposit
8. Commercial paper
9. Money market mutual fund
10. Other.

· Institution of money market -
1. Central bank
2. Commercial bank
3. Indigenous financial institution
4. Discount house
5. Acceptance loan

· Structure of Indian money market.-
1. Organized sector
2. Un-organized sector
a. Money – lender
b. Indigenous banker

· Drawback of Indian money market
1. Dichotomy
2. Overall shortage of fund in money market
3. Seasonal shortage of fund
4. Inefficient and inadequate banking facilities
5. lack of co-ordination
6. Divergence of lending rates and policies
7. Inadequate control by the reserve bank
8. Inelasticity and instability
9. Under-developed bill market
10. Improper care of rural finance
11. Non-banker acceptance
12. Blending of lending and trading activities

· Measure for improvement of Indian money market
1. Legislative measure
2. Co-operative movement
3. Agricultural refinance and development co operation
4. Agricultural credit board
5. Rural bank
6. Extension of credit guarantee scheme
7. Link between indigenous banker and commercial banks
8. Bill market scheme
9. Nationalization of bank
10. Lead bank scheme
11. Spread of post office saving bank
12. Uniform chit fund legislation

· Important of money market.-
1. Money market is an important source of financing trade and industry through a bill, commercial paper.
2. Availability of fund in the money in the money market
3. Money market offers an avenue to the commercial bank for investing short term surpluses of fund.
4. Money market facilitates affective implementation of monetary policy of the central bank of a country.
5. Money market serves as an important guide to the government in formulating, revising and implementing it’s monetary policy.
6. Money market offers to the government an important non-inflationary avenue of raising short term fund through bill which are subscribed by commercial bank and the public.

· Financial market consist.-
A. Unorganized market and Organized market
B. Money market and Capital market
C. Primary and Secondary market
D. Broad, Deep and shallow financial market

· Financial institutions are”
A - Money Market
Is concern with the supply and the demand for investiable fund. Its reservoir short-term funds.
Including – Central bank, Commercial bank, Indegenious, Financial institution, Accepting houses.

B - Capital Market
It’s a place where the medium and long term financial need of business and other undertaking are met. By financial institution which supply medium and long term resources to borrowers.
Including – Bank, Merchant bank, Mutual fund, Life insurance companies, development bank.

· Central Bank
The Reserve Bank of India was inaugurated 1st April 1935 and nationalized 1949

· Function of Reserve bank of India according to Sundharam and Dutt :
1. Monetary function
2. Non-Monetary function
3. Promotional and development function
Then Added by Vasant Desai (1996)
1. Issuing currency notes / Currency authority
2. Serving a banker to the government
3. Acting as a banker to the government
4. Monetary regulation and management
5. Exchange management and control
6. Collection of data and their publication
7. Miscallanious development and promotional function and activities
8. Agricultural finance
9. Industrial function
10. Export finance

· Monetary policies is a policy which influence the public’s stock of money substitute or the public demand for such assets or both.
· Monetary policy of the RBI refer to a regulatory policy where by the central bank maintain its control over the supply of money for the realization of general economic goal

· Indian monetary policy important objective are :
(The issue in Chakravarty committee)
a. Price stability
b. Growth
c. Equity and social justice
d. Promoting and nurturing new financial institution

· Credit control by the RBI are:
1. The bank rate policy
2. Open market operation
3. The cash reserve ratio
4. The statutory liquidity ratio
5. Selective credit control

· Feature of monetary policy an important objective by RBI
1. Credit restriction
3. Expantion of money supply and bank credit
4. Price stability
4. Growth equity and social justice
5. Promoting and nurturing new monetary and financial institution

· Deficiencies Indian money market
1. Existence of unorganized money market
2. Absence of integration
3. Diversity in money rate of interest
4. Seasonal stringency of money
5. Absence of the bill market
6. Absence of well organized banking system

· Rate of interest
Rate of Interest it is the rate which commercial bank and money market institution agrees to give discount facilities or advances loan.

· Monetary and money measure by RBI
A. qualitative measures
1. Bank rate
2. Open Market Operation (OMO)
3. Cash Reserve Ratio (CRR)
4. Statutory Liquidity Requirement (SLR)
B. Qualitative measures
1. Credit ceiling
2. Margin requirement
3. Variable interest rate
4. Regulation of consumer credit
5. Moral suasion
6. Licensing

International Trade and Market

2006-06-26T05:07:00.000-07:00

· The pure theory of international trade
The pure theory of international trade deals with equilibrium phenomena or trade. It seeks to analyse and expose the condition of equilibrium in real terms. It probe into the economic couses and consequence of the international trade. The monetary theory of foreign trade is confronted with the monetary mechanism of the international economic transaction. Including financial transaction and capital movement. It primarily deals with the determination of exchange rates and seeks to examine the methods and processes of adjustment in the balance of payments equilibrium.

· The theory of absolute advantage
The classical theory of international trade is known as the theory of comparative cost. This theory is simply an application of the principle of division of labour to the production of good by different countries. The classical theory averred that international trade develops with geographical (countrywise) specialization in the production of various goods which is reflected through the differences in their comparative costs of production between any two countries.

· Comparative Cost Advantage = David Ricardo
This theory is originated as an improvement and development of the eighteenth century criticism of the mercantilist policy. The docrine of this theory continue to command attention because its show analytically the superiority of free trade over protection.
The classical theory of comparative cost was developed by Davis Ricardo, according to this theory the value of any commodity is determined by its labour will produce that determine their present or past relative values.

· Modern international trade (General Equilibrium Theory)
The view on Bertil Ohlin “
1. the immediate couse of inter regional or international trades is the different in relative commodity price in the two region.
2. The different in relative commodity price are due to the scarcity of the factor of production in two region or countries.
3. In international trade implies an exchange of abundant factor for scantely supplied factor. The movement of goods from one region to other region or country take place only because there is scarcity of factor in one region which result in higher price this phenomenon attract the productivity factor from abundant region to the scarcity region.

· Heckscher – Ohlin Theorem
A. Heckscher view of “
That though comparative cost different is the basis of international trade, the root causes is the condition which produces this difference. As a matter of fact, the differences in comparative costs advantage occurs because of “
· The different in relative scarcity (and so relative price ) of factor of production in the two country.
· The input of different factor proportion required in the production function of different commodity .
B. Ohlin view of “
The immediate cause of international trade is the differences in commodity price and differences in factor of endowments cause factor price to differ.(since factor price are the ultimate cost of production costs and thus commodity price will differ in different countries).

· Factor Price Equalization Theorem
It may be stated as “ other thing being equal, free international trade of commodities like factor movement, causes absolute return or price of factor to be identical in each participating countries. When the absolute return becomes equal then relative factor prices must be identical under the homogeneity condition.

· The Rybezynki Theorem
This theory is seeks to examine the effect of change in the factor supplies in one of the two trading countries in their trade relationship.
This theory also show that the change in factor supply in the country comes in the way of factor – price equalization. Further, when the country tends to increase its exportable goods in supply due to increase in the abundant factor supply its term of trade will deteriorate. For instance as in our illustration when the country produce more of cloth and less of wine. Its export supply of cloth will increase and import demand for wine will also increase this would adversely affect its term of trade assuming no change in the condition of its trading partner.

· Factor Causing Intra – Industry Trade
A number of factors can be attributed to the emergence of intra-industry trade such –
1. Trade in homogenous goods for re-export. A country may import goods in bulk in order in electronic good importing from Japan and exporting to Malaysia, Thailand, Indonesia, etc is of this type.
2. They area between the two cost ratios determine the region of mutually beneficial trade for the country.
3. Actual trade will depend on the relative demand factors for the concerned goods in two countries.
4. Agricultural goods are exported in post-harvest and imported in harvest season by a country.
5. Cross border trade.
6. Differentiated products.

· Criteria of measuring the gain from trade
1. Reduction in the cost of production
2. Enhancement of the real income
3. The nature of term of trade

· Term of trade
The rate at which one country goods exchange againt those of another is referred to as the term of trade.
Term of trade depend on the prices of commodity entering into foreign trade.

· Concept of term of trade - Mier
1. Those term of trade which relate to the real – ratio of international exchange between the commodities. And in this group discussed are “
* Net barter term of trade
* Gross barter term of trade
* Income term of trade
2. Which is relate to interchange between the productive resource, and there are “
* Single factoral term of trade
* Double factoral term of trade
3. Those term of trade which interpret the gain from trade in term of utility analysis and there are “
* Real cost term of trade
* Utility term of trade

· “Trade as the engine of the economic growth”
D.H Robertson was profound this statement and the important is that “
1. Trade provide material
2. Trade is the meant and vehicle for the dessimination of technology knowledge
3. Trade is also vehicle for international movement of capital
4. Free international trade is the best anti-monopoly policy and the best guarantee for the maintenance of a healthy degree of free competition.

· Tariff
Tariff in international trade mean or refer to the duties or taxes on international traded commodity when they cross the national border
Classification of tariff
1. On the basis of origin and destination of the goods crossing the national border and there are “
A. Export duties
B. Import duties
C. Transit duties
2. Reference to the basis for quantification of the tariff and there are ‘
A. Ad-Valorem duties
B. Compound duties
3. Which respect to its application between different countries, and the system may classify “
A. Single-column tariff
B. Double-column tariff
C. Triple-column tariff
4. with reference to the perpouse they serve, tariff may classify to
A. Revenue tariff
B. Protective tariff
C. Countervailing and anti-dumping duties

· Effect of tariff à Import Duties
1. Protective effect
2. Consumption effect
3. Redistribution effect
4. Revenue effect
5. Income and employment effect
6. Competitive effect
7. Term of trade effect
8. Balance of payment effect

· Non Tariff Barrier NTB
It also call new protectionism
Non tariff barrier has two categories
A. Include those which are generally used by developed country to prevent foreign exchange outflow, or those which result from their chosen strategy of economic development
B. Those which are mostly used by developed economist to protect domestic industry which have lost international competitive and or which are politically sensitive for government of these country.

Note” NTB is less transparent and difficult to identify.

· Quantitative Restriction (QUOTA)
Quota are an important, it is mean of restricting import and export and also represent a ceiling on the volume of import/export.

· Import Quota
There are five type of import quota, including import licensing”
1. Tariff quota
2. Unilateral quota
3. Bilateral quota
4. Mixing quota
5. Import licensing

· Balance of payment
It is mean an excess of payment over the receipt.
Is systematic and summary record of a country’s economic and financial transaction with the rest of the world and over period of times.

· Component of balance of payment
1. Current account
2. Capital account
3. Unilateral payment
4. Official reserve asset account

· Kind of disequilibrium in balance of payment
1. Cyclical disequilibrium
2. Secular disequilibrium
3. Structural disequilibrium

· Cause of disequilibrium in the balance of payment
1. Cyclical fluctuation
2. Huge development and investment
3. Rapid economic development
4. A high increase in domestic production foodstuff
5. High population and high birth in poor country
6. Demonstration
7. International borrowing
8. Different demand

· World Bank
Purpose of World Bank is to tackle the problem of international investment
And the major function are –
1. To assist in the reconstruction and development of the territories of its member
2. To promote private foreign investment
3. To promote the long term balance growth of international trade
4. To arrange loans and guaranteed by it in relation to international loan

Ir_ones
Preparing for the final examination of MA Economic at Raja Balwant Singh College (RBS College) Agra University, Agra- India.

Labor Economic

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- Nature and Characteristic of labor market
a. Labor market may be defined as a process by which supplies of particular type of labor and demand, for that type of labor balance or seek to obtain balance. – or –
b. Manufacturing or trading centre plus by the agricultural hinter land directly tributary to it.

- Characteristic of labor market
1. The relation between a buyer and seller in labor market is not temporary and it is to continue for some times.
2. Labor market are essentially local in character
3. Lack of mobility
4. A labor market is essentially an imperfect market where one does not find a normal wage rate to which the market rate naturally tends.
5. Monopoly in labor market
6. Labor market do not do justice to the worker

- Special character labor market in India
1. Existence of under-development in various sector of economy
2. Causal nature
3. A great surplus of all worker over all available jobs
4. Existence of unstable labor force
5. Age structure that most belong to the youngster

- Cause of Un-employment
1. Poverty
2. Excessive increase in population
3. Slow growth of economy
4. backward agriculture
5. Lack of national employment policy
6. Existence of excess capacity in industry
7. Emphasis on capital intensive technique
8. Defective educational system

- Type of Un-employment
1. Frictional
2. Voluntary
3. Involuntary

- Method of recruitment
1. Recruitment of labor through intermediaries
2. Direct recruitment

- Source of recruitment
1. Internal
2. External

- Wage determination
a. Wage are reward for the service of labor that are used during process of production
b. By labor mean –
The effort, both by physical and mental made by the human being

- Concept of wage
1. Money wage or Nominal wages
2. real wages

- The theory of wages
1. The just wage of the middle ages
2. The classical theory of wages
a. Adam Smith contribution to the wage theory
b. The subsistence theory of Ricardo
c. The standard of living theory
d. The wage fund theory
e. Residual claimant theory

3. Neo- Classical modern theory of wages
a. The marginal productivity theory
b. The bargaining theory of wages
c. Taussig’s theory of wages
d. Kalecki’s theory of wages

- The bargaining theory of wages – this theory was started in 1933 due to the weakness of the marginal productivity theory.
And the major assumption are “
1. Wages, hour and working condition a matter of bargaining
2. Without organization and concerted action there will be a tendency toward undesirable
3. No adequate safeguard is found in the operation of the factor at work in the organization trade
4. There is flexible, changeable situation

- Meaning of labor supply –
A. Supply labor to the firm
B. Supply labor to the industry
C. Supply labor to the entire economy

- Determinant of the supply of labor –
1. Other wage rates
2. Non-wage income
3. Preference for work versus leisure
4. Non-wage aspect of the job
5. Number of qualified supplier

- Determinant of the demand of labor –
1. Product demand
2. Productivity
3. Price of other input
4. Number of firm

- The demand of labor generally elastic –
a. The greater the elasticity of the product demand
b. The larger the ratio of labor cost to the total cost
c. The greater the substantialibility other input of labor
d. The greater the elasticity of supply of other inputs

- The concept of wages
1. The statutory minimum wages
2. Basic minimum wages
3. The minimum wages
4. The fair wages
5. The living wages
6. The need-based minimum wages

- The theory of minimum wages –
A theory which could meet the normal need of the average employee regarded as human being living in civilized society

- The theory of living wages –
The living wage should enable the male earner to provide for himself and his family the bare essential of food, but a measure of frugal comfort including education, etc

- The theory of fair wages –
The fair wages is an equal to that received by worker performing work of equal skill, difficulty or unpleasantness

- Bonus –
Bonus is a payment made to worker in addition to his normal wages, it is a gesture paid or something goodwill by employer to employee

- Profit sharing –
Profit sharing is implies employer gives a share in the surplus profit of the business to the worker in addition to the wages.

- Social security –
Social security it refers to the protection provided by the society to its member againt providential mishap over which a person has no control
- The idea of social security is that the state shall make it self responsible for ensuring a minimum standard of material welfare to all it is citizen on a basis wide enough to cover all the main contingency of life.

o Type of insecurity –
1. Income insecurity
a. Inadequate wages
b. Faulty methods of wage payment
c. Lay-off
2. Occupational insecurity
a. Occupational disease
b. Improper condition of work
c. Industrial accident
3. Natural insecurity

o Defination of social security include –
a. Social insurance
b. Social assistance
c. Family benefit
d. Health care and other social justice
e. Related social welfare service

- Trade union –
- Trade union is an organization whose principle purpose include the regulation of relation between employees and employer or employer association, a house or company union is an association of employees all belonging to the same company which will probably have no connection which trade union movement.
- An industrial or general union has a member who work in the same industry it is usually very large.
- A craft union is a small union of skilled worker. Union affair are regulated by the trade union act (1984) and the employment act (1988)
- This provide the secret ballot must be held for election of union executive committee and before any industrial action backed

Ir_ones
Preparing for the final examination of MA Economic at Raja Balwant Singh College (RBS College) Agra University, Agra- India.

Macro Aspect

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· Main characteristic of Trade cycle
1. Formed by two contrary forces of expansion and contraction are follow the other
2. These forces occur at regular interval
3. Crisis are always present in a trade cycle
4. Change from upward to downward is faster
5. Trade cycle occur in organized and money economies
6. Its may be regional, national and international

· National Income
National income is the sum total of money value of all good and services produced in a country during a given period
A view of economist”
Marshall - is a aggregate of a good and services produces during a year.
Piqou - The national income dividend is that part of the objective income of the commodity including income derived from abroad which can measure in money.
Fisher - The national dividend or income consist solely of services as receive by ultimate consumer, weather from the material or from their human environment.
Marshall - The labor and capital of country acting upon it natural resources produced annually a certain net aggregate of commodities.

· A concept of national income
1. Gross National Income / Product and Net National Income
2. National Income at market price and at factor price
3. Net National Income at factor price and Net Domestic Income
4. Personal Income and Disposable Personal Income
- or –
1. GNP / P & NNI
2. NI at market price & factor price
3. NNI at factor cost & NDI
4. PI & DPI

· Measure of National Income
1. Income method or National Income
a. Labor income
b. Mixed income
c. Rental income
d. Cooperate income
e. Income from interest
2. Product method
3. Final expenditure methods
a. Personal consumption expenditure
b. Gross domestic private investment
c. Government expenditure
d. Net foreign investment

· Significant of Multiplier
- It is important theorical concept
- It is explained the different phase of business cycle.

Limitation of Multiplier
1. Sufficient availability of consumption goods
2. Maintainance of investment cycle regularly
3. Multiplier period (there is a time gap between increase in income and increase in investment)
4. Net increase in investment
5. Multiplier will not work at full employment ceiling
6. Existence of closed economy Viz. no import export trade
7. No investment from induced consumption

Leakage of Multiplier are due to –
1. Shaving
2. Debt collection
3. Import
4. Price inflation
5. Liquidity preference
6. Purchase of old stock and security
7. Taxes and corporation saving

Classical theory of Employment
The classical theory is based on the nation that supply always creates its own demand it is know as Say’s law of market

Micro Economic

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Introduction and basic concept
Is may be defined as that branch of economic analysis which studies the economic behaviour of the individual unit, may be a person, a particular household, or a particular firm. It is a study of one particular unit rather than all unit combined together. And In micro-economic also studied the various units of the economic such as thousand of consumer, thousand of producer or firm, thousand of worker and resources supplier and how they function and how they reach the equilibrium.

Scarcity and Choice
Basically human want for good and service are unlimited, well the productivity resources with which to produce goods and services are scarce. With our wants being virtually unlimited, and resource scarce, we cannot satisfy all our wants and desire by producing everything we want. A society has to decide how to use its scarce resource to obtain the maximum possible satisfaction of its member, it is this basic problem of scarcity which give rise to many of the economic problem which have long been the concern of economic.
The scarcity of resource relative to human want gives rise to struggle of man for sustenance and effort by him to promote the well being. That the scarcity of resource in relation to human wants is the fundamental economic problem can be easily understood in the context of poor and developing country like India where quite large number of population live at the bare subsistence level. The struggle for existence due to scarcity of resource is too obvious in them to need any elaborate explanation. Even in developed country like USA where effluence and prosperity have been brought about also confront the scarcity problem raises some doubt.
Since all wants cannot be satisfied due to scarcity of resource we face the problem of choice – choice among multiple want which are to be satisfied. If its decide to use more resource in one line of production, some resource must be withdraw from another commodity, thus the problem of choice from the view point of the society as a whole refers to which goods and in what quantities are to be produce and productive resource allocated for their production accordingly so as to achieve economics in term of this basic economic problem.
The problem of scarcity give rises to some problem generally known as the basic economic problem which s society has to solve so as to promote material of well-being of its people. These basic economic problems related to what commodities are to be produced.
It is with regard to this problem of resource allocation the choice of production methods, distribution and economic growth which have their roots in scarcity of resources, the economist has been asking question from time to time to providing the answer for them. Beside, economist have also been arising the question about efficiency of the resource allocation for the production of goods and their distribution among the people. This question of economic efficiency is aimed at knowing whether or not a particular pattern of production and distribution ensure maximum social welfare.

Deductive and Inductive Methods
The deductive methods is also called abstract, analytical and priori methods and represent an abstract approach to the derivation of economic generalization and theories. The principal steps in the process of deriving economic generalization through deductive logic are –
a. Perception of the problem to be inquire into
b. Defining precisely the technical term and making appropriate assumption often called postulates or premises.
c. Deducing hypotheses that is deriving conclusion from the premises through the process of logical reasoning
d. Testing of hypothesis deduced.
Merit and Demerits of Deductive Methods
1. Useful mathematical technique can be employed to derive generalization of economic.
2. The deductive logic is useful economic theorem can be derived without the tenuous and detailed collection and analysis of data which are required under the alternative methods.
3. In view of limited scope for controlled experimentation in economic, the methods of deduction is extremely useful method of deriving generalization.
4. The use of sophisticated mathematical methods in the deductive methods approach enables the economic to introduce accuracy and exactness in economic principle and theories.
Advantage of the deduction methods –
a. Its lead to correct conclusion provided the premises from which the reasoning proceed are correct.
b. Its only drawn back the conclusion derived through the deductive methods can have only a limited application because economic condition are continually changing.

Inductive Methods
The indicative methods which is also called empirical method derives economic generalizations on the basic of experience and observation. In this method detailed data are collected with regard to certain economic phenomenon and effort is then made to arrive at certain generalizations which follow from the observation collected.
There are three ways which can used for deriving economic principle and theories –
a. Experimentation
b. Observation
c. Statistical or econometric methods
Advantage of the Inductive methods –
a. The method of statistical induction is indispensable for the formation of economic policy
b. The economic laws which are arrived at by process of induction lead to precise exact measurable conclusion.
c. Some of the important theory has been discorrect as a result of use of induction.
d. Its used to check and verify the conclusion of deduction to bring to light deficiencies in their treatment and for amplify their conclusion.
e. The chief merit of inductive methods is to show the complexity of economic phenomena and the impossibility of deriving conclusion and principle which would have numerical application.

Positive economic and Negative/ Normative
Positive economic is concern whit what is
Normative economic is concerned with what ought to be
Positive economic is concerned with the utilization of means or resource for the advancement of economic goods.
Normative science is concerned about what economic consider thing as they ought to be and its discussed the desirability to be achieved.

Elasticity (Price, Cross, Income)
· Price Elasticity
The price elasticity is a measure of the responsive of demand to change in the commodity’s own price. If the changes in price are very small we use as a measure of the responsiveness of demand the point elasticity demand. If the change prices are not small we use the arc elasticity of demand as the relevant measure.
· Income Elasticity
Income elasticity is defined as the proportionate change in the quantity demanded resulting from a proportionate change in income.
The income elasticity is positive for normal goods. Some writers have used income elasticity in order to classify good into ‘luxuries’ and ‘necessities’. A commodity is a considered to be luxuries if its income elasticity is greater than unity. A commodity is a necessity if its income elasticity is small (less than unity).
The main determinants of income elasticity are:
The nature of the need that the commodity covers: the percentage of income spent on food decline as income increase ( this known as Engel’s law and has some time been used as a measure of welfare and of the development stage of a economy).
The initial level of income of a country.
The time period, because consumption pattern adjust with a time-lag to changes in income.
· Cross Elasticity
The cross elasticity is defined as the proportionate change in the quantity demanded of x resulting from proportionate change in the price of y.
The sign of the cross elasticity is negative if x and y are complimentary goods, and positive if x and y are substitutes. The higher the value of the cross elasticity the stronger will be the degree of substitutability or complimentary of x and y.
The main determinant of the cross elasticity is the nature of the commodities relative to their uses. If two commodities can satisfy equally well the same need, the cross elasticity is high, and viva versa.

Distribution
A. Rent
The term of rent is used in the following senses in modern economic theory –
the term of rent refers to the rental made for the use of fixed factors of production whose existence is not dependant on any human effort or sacrifice.
the term of economic rent is employed for the surplus earned by unit of a factor of production over and above the minimum earning necessary to induce it to stay in their present use industry or occupation.
the term of rent cover the earning (net of depreciation and interest charges) of fixed capital equipment like machinery in the short run.

Ricardian theory of rent
Ricardo defined rent as follow: Rent is that portion of the produce of earth which is paid to the landlord for the use of the ‘original and indestructible power of the soil’. Or is a payment for the use of only land and is different from contractual rent which includes the return on capital investment made by the landlord in the form of hedge, drains, well and the like.

B. Interest
The theory of interest is a reward for capital but there are two concept of interest and there are one concept of interest in the real rate of interest which is the rate of return on physical capital such a machine vehicle, tractor created for the purpose of the producing more goods. A capital asset is used for production for several years and yields a stream of return over the years. A rate of return on it is obtained by calculating the present discounted value of the yields earned over the number of years for which capital asset is used for production .
The second concept of interest is the price paid for the use of borrowed funds from other and its often called money rate of interest.

C. Profit
Pure profit of the entrepreneur are found by subtracting from the gross residual income the imputed values of rent and interest on the self owned land and capital employed by the entrepreneur and also the imputed wages firm his work of routine management.
A popular conception of profit is that they arise in dynamic economy, that is, in economy where changes are taking place. In static economy where nothing changes there can be no profit. (J.B. Clark)
The main function of the entrepreneur is to introduce innovations in the economy and profits are reward for his performing this function. What is the innovation stand for?
Any new measure or policy adopted by an entrepreneur to reduce his cost of production or to increase the demand for his product is an innovation.
Two type of innovation is:
Those which reduce cost of production or which change the product function .
Those which increase the demand for product or which change the demand or utility function. ( Joseph Schumpeter )