India’s economic growth slowed to 6.5 per cent during the July-September quarter because of a fading low-base effect. For the full year, we now expect the economy to grow at 7 per cent, with risks tilted to the downside. This implies that the second half of the year (October-March) will see growth slow down to 4.6 per cent, again largely due to the base effect and slowing global growth. This was the second consecutive quarter with no functional disruption of economic activity by the Covid-19 pandemic. Since October, Google, too, has stopped reporting mobility indicators, which had become one of the most tracked data points for analysts and policymakers since the pandemic struck. This suggests that Covid-19 is unlikely to come in the way of growth for most parts of the world, with China, which is following a zero-Covid policy, being the key exception. That’s the good news. Express View | New government data paints a mixed picture of the Indian economy The … [Read more...] about How can India make a soft landing amid global economic crash?
Inflation economic cycles
(This story originally appeared in on Dec 03, 2022) NEW DELHI: The Congress will raise three main issues: India-China border tension, inflation and interference in the workings of the constitutional and independent institutions in the country, in the upcoming Winter Session of Parliament. The session begins on December 7 -- a day before poll results in Himachal Pradesh and Gujarat -- and will end on December 29. The government plans to introduce 16 new Bills during the session, including one that seeks to reform the electoral process in cooperative societies. Earlier on Saturday, top Congress leaders party Congress president Mallikarjun Kharge , leader of the Congress in Lok Sabha Adhir Ranjan Chowdhury , chief whip of the party in Rajya Sabha Jairam Ramesh and party's chief whip in Lok Sabha K Suresh met at the residence of former party chief Sonia Gandhi to evolve a strategy. This will be the first session of Parliament after Kharge took over as the Congress … [Read more...] about China, inflation & more: How Congress wants to corner Centre during Winter Parliament Session
The Indian Express reported in its print edition of Sunday (September 18) that “there are early but discernible signs of a divergence of views between the government and the central bank on the latter’s monetary action to check inflation versus the former’s imperative to rekindle growth”. What does this mean, and what are its implications? What is the trade-off between growth and inflation? In any economy, there are two overwhelming concerns for policymakers: promoting fast economic growth, and maintaining price stability. Both are important. If fast economic growth comes with a high level of inflation then it undermines future growth in two broad ways. Also in Express Explained | Why is India’s August unemployment rate the highest in the past 12 months? One, high inflation changes consumer behaviour: if prices are rising fast, it makes sense to buy things today rather than wait for tomorrow. But when everyone — or at least a large number of people — starts … [Read more...] about What explains the divergence between the RBI and govt on monetary policy?
If you are invited to write an essay on the current economic situation in India, what would be your top two subjects? Most people would pick the people’s top concerns: unemployment and inflation. The Ministry of Finance (MoF) publishes a Monthly Economic Review. I did not think that a bunch of six young and enthusiastic economists, asked by the MoF to write such an essay for the Review, would consciously avoid the word unemployment as well as words such as malnutrition, hunger and poverty. (I wonder if it was whispered in their ears that the Prime Minister may read the article). The group of economists knows but will not admit that the omission of unemployment, malnutrition, hunger and poverty is a grave dereliction of scholarly duty. Also by P Chidambaram | Hijab: Point and Counter point Why a Review? The Monthly Economic Review is a valuable document. I expected that the 2022 September Review (released on October 22, 2022) would give an objective mid-year … [Read more...] about P Chidambaram writes: Head buried in the sand
Synopsis The broad consensus among economists is that India may clock a GDP growth rate of almost 7% this fiscal year and about 6.5% next year — an exception in a world facing slowdown and even recessionary risks. But it won’t be easy as India too will be buffeted by strong headwinds. Last month, the Reserve Bank of India (RBI) pegged the country’s Gross Domestic Product (GDP) growth for the quar ter ending September at 6.1-6.3%. “If this is realised, India is on course for a growth rate of about 7 per cent in 2022-23,” the central bank stated in its monthly bulletin. Earlier this week, the National Statistical Office (NSO) released the Q2 data. And the numbers were on expected lines. The GDP at constant (2011-12) prices for the quarter is estimated to be Rs 38.17 lakh crore — a growth of 6.3% over the same quarter last year. The Indian economy has certainly slowed when compared with the 13.5% growth of Q1, which was helped by a favourable base effect as growth had weakened … [Read more...] about India seems to be on course to a GDP growth of about 7% this fiscal year. But the journey won’t be easy
Synopsis "I do not even try to predict FII flows into India let alone China so because I do not think that is a relevant metric to track ." In 2021 when that trend changed and after a very long time India moved through the outperforming end of global markets, I was quite clear that the trend would continue this year which it has so that clearly has happened, says Devina Mehra, Chairperson, MD & Founder, First Global Do tell us now where you see the strength in the Indian markets. Are you as bullish as some of the experts we have been speaking to? Actually I have been bullish for longer than these experts have been, from the beginning of the year actually and last year itself I had been saying that India will be an outperformer this year relative to global markets which you have seen has been quite dramatic. Not only the absolute movement, if you look at relative to all global equity markets, India has done very well. And the reason for that was that it had not … [Read more...] about Why Devina Mehra is bearish on fin tech companies