It’s been a rough summer for Manmohan Singh. In May the Indian Prime Minister endured a hail of criticism from the business community after he urged corporate chieftains to “eschew conspicuous consumption” or risk a backlash—a warning that left his audience wondering whether the sage economist was turning his back on reforms he himself had pioneered as finance minister 15 years ago.

The rupee then began to levitate, crimping competitiveness, especially vis-а-vis China. Heavy monsoon rains caused devastating floods, displacing thousands of villagers and focusing attention on the government’s inability to shore up India’s crumbling infrastructure. Now, leftist parties are threatening to withdraw their support for the ruling coalition unless Singh turns his back on a landmark agreement with the U.S. on nuclear power for civilian uses.

Singh’s stumbles have not hurt growth, which is expected to come in at 8.5% for the year. But his government has been so embroiled in internal disputes that New Delhi has failed to capitalize on an extraordinary opportunity to cut farm and oil subsidies, abolish rent control laws, and change onerous labor regulations. These and other measures are essential if India is to keep growing at almost double digits and lower the poverty level from 25% of the population.

What went wrong? Part of the problem lies with the 16-party coalition led by Singh’s Congress Party: Keeping it together is a full-time job in itself. Another is that voters had unrealistic expectations of Singh. As finance minister, the Oxford grad unshackled India’s economy with the support of then-Prime Minister Narasimha Rao. Now he looks ineffective. Critics say it is Congress Party chief Sonia Gandhi—and not Singh—who really pulls the levers of power, and that she is lukewarm about market reforms. “We thought Manmohan Singh as Prime Minister would be the same as Manmohan Singh the finance minister,” laments Subir Gokarn, chief economist for Asia-Pacific for Standard & Poor’s ( ). “Our expectation was misplaced.”

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The business community’s list of complaints is long. Privatization of state-run companies has been put on hold, on ideological grounds. A program to build Chinese-style special economic zones has foundered over how much to pay displaced farmers for their land. Official approvals, slow to come, are blocking badly needed commercial and residential construction. “Our lives are getting choked,” says Mohan Pai, head of human resources at Infosys Technologies Ltd ( ). “The airports are choked, the trains are choked, the sewers are choked. I am feeling less optimistic about my country’s ability to get out of this, at the best time in our history.”

India’s poor don’t have much to cheer about either. In 2004 the government launched a $2.8 billion annual plan to guarantee rural laborers 100 days of work at minimum wage—a bid to provide a livelihood to millions. But in most states, critics say the scheme has been wasteful and ineffective and that a $6.1 billion project to revamp rural infrastructure has had mixed results. Meanwhile, measures to overhaul education and health care have not yielded a payroll yet, though Delhi raised taxes on the affluent to fund the reforms. “What is my tax for?” says Ajay Shah, an economist and former adviser to the finance ministry. “They are trying to improve outcomes by throwing more money at dysfunctional systems.” A government spokesman says the programs are off to a good start.

Those inclined to optimism say that the quarrel between Singh and his left-wing partners could help reinvigorate his leadership. Others are already putting their hopes on the next regime. “Perhaps a new government, whatever it will be, will change things,” says Madhav Bhatkuly of Mumbai equity fund New Horizon. That’s cold comfort for those who were hoping for badly needed action now, not later.
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Harry Potter will be winging his way overseas as never before after the seventh and final instalment of the boy wizard’s tale notched up record orders from abroad.

With less than a month to go before Harry Potter and the Deathly Hallows goes on sale, the publisher, Bloomsbury, said that export orders were already 17% ahead of those for the previous book, Harry Potter and the Half-Blood Prince.

Bloomsbury, whose fortunes have been transformed over the past 10 years by JK Rowling’s creation, will be following up the July 21 launch with boxed set editions of the complete series on October 1. The paperback edition of Harry Potter and the Deathly Hallows is due in 2008.

Amazon said this month that it had received more than 1m pre-orders. Its chief executive, Jeff Bezos, admitted to shareholders that the web retailer would not make any profit on the bestseller, which is being widely discounted. Barnes & Noble, the US bookseller, said in April that it expected to take more than 1m pre-orders, doubling its previous record.

Harry Potter has enjoyed huge success overseas and is published in 65 languages, while the films based on Rowling’s books have pulled in substantial box office takings. Bloomsbury’s export orders come from more than 60 countries and are all for the English-language version.

The firm has also secured the publishing rights to a book on the investment strategies and philosophy of Warren Buffett, the legendary billionaire US investor. “It could become the No 1 bestseller in the UK and Australia,” Bloomsbury chairman Nigel Newton told Reuters.

Kate McCann is to be formally declared an official suspect by Portuguese police investigating the disappearance of her daughter Madeleine, a family spokesman said today.

The announcement is expected to be made when Mrs McCann returns to a police station in Portimao later this morning.

A family friend told Sky News that Mrs McCann was “amazed” and very concerned by the development in the case.

She will be declared an “arguido” - someone who has not been arrested or charged but is being treated by police as more than a witness.

It is believed the change of status would allow police to ask Mrs McCann 22 specific questions about the disappearance of her four-year-old daughter from the family’s holiday apartment in the Algarve resort of Praia da Luz on May 3.

Mrs McCann emerged from the police station into a media scrum early today after spending 11 hours being interviewed by investigators yesterday. It was her first formal interview with police since the day after Madeleine’s disappearance and she was accompanied by her lawyer, Carlos Pinto de Abreu.

Visibly exhausted, she made no comment but Mr de Abreu told reporters that she was interviewed as a witness.

Mrs McCann has consistently denied any wrongdoing in relation to her daughter’s disappearance.

Her husband, Gerry, is expected to be interviewed for the third time by police later today.

Yesterday, a family friend Justine McGuinness said the McCanns were “victims” in the extraordinary set of events.

“Kate McCann has returned to Portimao to be questioned by the Portuguese police, to assist them in their investigations,” Ms McGuinness said. “Kate and Gerry are happy to help the police in their investigations to find their daughter, as they have since she was taken.”

The decision to reinterview them appeared to be a direct consequence of test results sent from the Forensic Science Service in Birmingham late on Wednesday.

Portuguese police, who have remained tight-lipped during the investigation, said yesterday that they had new evidence to work on. “Part of the tests have arrived,” a source close to the investigation told the Portuguese news agency Lusa.

Evidence analysed by the Birmingham laboratory reportedly includes blood samples and other evidence gathered from the Ocean Club holiday apartment where the McCann family was staying when Madeleine disappeared.

The evidence was gathered when British officers helped their Portuguese counterparts carry out a review of the case three months after the disappearance.

The Portuguese press speculated yesterday that the scientific evidence strengthened theories that Madeleine may have died on the night she disappeared, and in the apartment itself.

But there was no confirmation of that and the respected Publico newspaper, while quoting unnamed police sources who were prepared to back the speculation, warned that previous leads had come to nothing.

In a statement yesterday, Mrs McCann said she still believed her daughter was alive. “I miss Madeleine so much,” she said. “Gerry and I want to appeal again to the person or people who took her … to do the right thing. It is not too late - please let her go or call the police.”

The McCanns have remained in Portugal to help search for their daughter but have recently indicated that they are considering moving back to the family home in Rothley, Leicestershire.

Mr McCann, a hospital cardiologist, has said he would like to return to work while his wife, a GP, reportedly wants to devote herself to their two-year-old twins, Amelie and Sean.

Mrs McCann will be the second arguido in the case, along with the British ex-pat Robert Murat, who lives close to where Madeleine vanished while her parents were dining in a nearby restaurant.