Tag Archive: indian economy

Budget 2018: More Sleight of Hand

An analysis of budget break-ups since 1999 shows that proportions of most heads just do not change, as GDP growth and hence tax revenues usually stay nearer where they have been before.

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Why should Bharat have to feed India at its cost?

About 70 per cent of India lives in rural areas and all-weather roads do not connect about 40 per cent of rural habitations. Lack of proper transport facility and inadequate post harvesting methods, food processing and transportation of foodstuffs has meant an annual wastage of Rs. 50,000 crores, out of an out of about Rs.370, 000 crores.

The Cost and Consequences of Demonetization?

The topmost priority for the government now should be is to remonetize the economy fully. Unless remonetization is complete, growth cannot be restored and employment cannot be generated.

Demonetisation: A One Man Made Disaster

Demonetisation is a one man made disaster which has pushed the already beleaguered and stumbling Indian economy into a tailspin, and cost livelihoods and lives. In the face of tremendous spin, hype and distraction unleashed around the facts surrounding Demonetisation, here are a few questions we expect Modi to answer, as he goes around talking a lot but saying nothing.

Who Wants Demonetization: The Politics of Governance Through Surgical Strikes

The absence of public deliberation and a lack of consistent rationale guiding such massive policy decisions of the government, and their endorsement by the elite, are disconcerting signs for any democratic culture. While the Left tries to debate whether the present conjuncture is authoritarian or fascist; an admixture of both is unfolding in front of our eyes but with the backing of a vocal hegemonic public within a liberal framework. Maybe these terms – fascist or authoritarian – will derive closure only in retrospect; but in the present, the opposition seems woefully ineffective in countering the Leader.

Economics and Politics of ‘Demonetization’

What are the most important reasons of the ‘demonetization’ – coming of big elections, initiative against the black money promised during the 2014 election, curbing the tax evasion or streamlining the market economy by cleaning the house itself?

Modi’s trump card

The term black money is all encompassing for income on which no taxes have been paid to the state. This income may be from legitimate sources or patently illegal activities such as smuggling, counterfeiting, corruption and narcotics. The estimates of how much black money is generated each year vary widely. But a widely cited, but still supposedly confidential study by the National Institute for Public Finance and Policy (NIPFP), commissioned by the government estimates the black economy in 2013 to be equal to about 75% of the GDP.

Monetary Policy Making At Mint Road

This is a very lucidly written book which takes us into the heart of monetary policy making by the reserve bank. It gives us an idea of the pulls and pressures the governor has to bear in his work. It touches upon the theoretical underpinnings of modern monetary policy making but it could have been more interesting if it had discussed in a bit more details the theoretical debates in monetary policymaking.

SINCE 1991 ARE WE ABLE TO CREATE ENOUGH JOBS?

Compared to 1991 more people are unemployed now and the gap between total number of workers and employment is increasing. And this is official government version of the data. Latest Asia-Pacific Human Development Report, released by UNDP, says that between 1991 and 2013, the size of the “working age” population increased by 300 million. But, Indian economy could employ only 140 million – less than half of the new entrants to the labour market.

GDP Growth by Higher Government Salaries?

We are now riding the tiger of a high wage enclave of government employees, who also drive consumption and hence GDP growth. It may now be difficult to get off this tiger. Its now clearly much too big to be tamed. But can we make it work a bit more for the country? How about increasing government revenues?

GDP: Growth or Fudge?

Higher growth rates will happen, but for that the government must do the right things first. That will come by making investments in human capital and in productive job creation. Since capital is always the constraint, it must be judiciously used. Fudging data will only create an interim illusion of well-being. Since reality catches up sooner or later, it is better to grapple with it now and rely on the illusion in 2019.