Columns

There are great expectations about the growth in the size of the Indian economy: that it has already exceeded the size of France’s economy, and that very soon it will exceed the size of the economy of the UK. An interesting question is, what shape will the Indian economy have in the future? What... read more

The SIT constituted by the Karnataka government deserves praise for getting closer to cracking the conspiracy of killing several intellectuals. Those involved in the Gauri Lankesh murder are believed to have had a hand in killing Dabholkar, Pansare, and Kalburgi. The press reports tell us that many... read more

The policy repo rate, which (over time) drives the rate at which banks lend to customers, has moved up from 6 per cent to 6.5 per cent in the last four months. The MPC wants this increase to “bite” (in the words of the RBI Deputy Governor and MPC member Dr. Viral Acharya) so that inflation is... read more

The annual study of State budgets released this month by the RBI comes amid important developments in the fiscal architecture of the Indian federal system. The Central government has a revised FRBM framework with the fiscal deficit alone as the target variable, which will be mirrored sooner rather... read more

But what is not a trick and carries the potential of a powerful framing of issues for 2019 is the message of “love versus hate”. Captured in a line and placed on a poster that came up in Mumbai, the position is simple: nafrat se nahin, pyaar se jeetenge (We will win not with hatred but with love... read more

The Standing Committee on Energy in its thirty-seventh report to the Lok Sabha said that there are 40,000 megawatts of power projects which are under financial stress. These are on the brink of becoming non-performing assets, and may have to go through bankruptcy. This represents more than 10... read more

The two reports serve to highlight macroeconomic concerns as we head into an election year. Consider some of the challenges. The Consumer Price Index (CPI)-based inflation is now at 5 per cent. This is already showing an upward momentum, especially in non-food prices, which include education and... read more

A recent report from the globally renowned Brookings Institution shows a dramatic reduction of poverty in India. As of May 2018, India has 73 million people living in extreme poverty, as against 87 million in Nigeria. For the first time, India does not house the maximum number of extremely poor... read more

We are on the edge of a full-fledged trade war. The U.S. has raised tariffs, China is hitting back and businesses are watching worriedly as tensions rise and uncertainty grips the market. Amid this flexing of muscles comes a story from a place in the U.S. State of Missouri called Butler County,... read more

The Rupee is falling. We are within striking range of Rs.70 to the US dollar. In intraday trade, the currency touched an all-time low of Rs.69.10 in the last week of June. The nosedive has raised alarm as the rupee becomes the worst performer among currencies. There are many questions from every... read more

Eight years and 17 reports later, it is not clear if “pre-emptive” actions have worked to control some of the messes that are all too obvious in the system. One of the key failures remains the rising tide of Non-Performing Assets, or NPAs, which stands out in the latest FSR as one of the deeper (... read more

The perception of safety of deposits in public sector banks is because of an implicit guarantee that the main “owner” or shareholder, i.e. the government of India, will never allow a PSB to go belly up. Depositor money is thus “safe” in a PSB and, as records reveal, no PSB has been allowed to fold... read more

A Brookings paper (June 8) quoting US defence sources said: “Adding the Indian Ocean to the mix dilutes China’s influence: It increases the size of the pond and adds other fish that are less amenable to swimming to its tune”. In other words, it was a strategic ploy for drawing China out into a... read more

The central banks of US, EU and Japan, for almost a decade, followed a policy of printing money, and kept interest rates near zero so as to induce more lending by banks and more credit growth. Bank create money supply by a process of credit creation. Ballooning debt also means rapid increase in... read more

The inability to ‘pick winners’ with certainty in a dynamically changing world is the principal argument of liberal economists who oppose the very idea of governments developing industrial policies. New technologies can change the shapes of manufacturing processes and disrupt historical sources of... read more

China will import 8 trillion dollars of goods and services in the next five years, a commitment announced by President Xi himself. This is a fantastic opportunity for India’s entrepreneurs. India must also do more to woo more Chinese tourists here, and achieve a 100 percent growth at the very least... read more

However, the real strength and appeal of these messages is more in the way everyday people can relate to, practice and engage with them. No official telling, however strong the arc lights, can match up to the pull and power of citizens taking the message forward and making it a part of their lives... read more

Given the global conditions, Fed rate hikes, capital outflows, elevated oil price rise, closing output gap, rising current account deficit and the likely pressures on the fisc in the run up to 2019, a rate hike seemed a foregone conclusion. These coupled with the recent rise in core inflation and... read more

MPC's unanimous decision for a rate hike that has come after a gap of more than four years took note of the prevailing good domestic demand condition, particularly in the rural areas on the back of a bumper harvest and the government’s thrust on rural housing and infrastructure. As already... read more

The overall growth signals both from the demand side (consumption and investment) and supply side (agriculture, manufacturing and services) are encouraging. There is a consensus that there are signs of revival of investment activity with manufacturing output showing strong revival and indicating... read more