governance, political economy, institutional development and economic regulation
India is at an inflection point. Realizing our long dormant economic potential is happening faster than our institutions are adapting to the new challenges. Becoming the fastest growing large economy this year with an unanticipated GDP boost of around 0.7 percentage point above our long-term growth rate of 6.6 percent over the past three decades […]
Read More “Big Government” & “High Growth”in IndiaHigh growth generates the comfort of public unwillingness to look a gift horse in the mouth. When growth is more than double the global levels and the highest achieved by any comparator entity, there are even fewer quibbles. This is true for both startups and national economies. Both are subject to “analyst fog” about an […]
Read More Interim Budget 2024-25: Government a prisoner of over-reachIndia plans to be a “developed” economy by 2047 even as it navigates the economic disruptions of the energy transition. To achieve this goal, India needs consistently higher levels of growth in national income to enhance the pool of investible capital—a crucial input into development. High national income is a necessary but not a sufficient […]
Read More Aspirations must be backed by investments for the energy transitionThe government did well to publish the NITI Aayog Report on Multidimensional Poverty (2019-21), highlighting the decline in the poverty headcount from around 24.85 percent in 2015-16 to 14.96 percent in 2019–2021—showcasing a substantial fall from the earlier survey outcomes. Both are based on the data collected during the standardised National Health Status Reports for the […]
Read More Mapping India’s PoorThe good news that India’s GDP grew at 6.1 percent in Q4 (January to March 2023) and at 7.1 percent over the entire fiscal year (2022-23) received less than deserved attention. The previous fiscal year (2021-22) was the first post-covid normal year. To clock a growth rate of 7.1 percent over a normal base year […]
Read More Greenlighting GrowthMonetary policy that hunts with the advanced economy “hounds”—via symmetric upward adjustments in policy interest rates over the last year—and simultaneously runs with developing country “hares”—by desperately trying to revive stalling growth—has contradictions just waiting to come home to roost. That growth in India is stalling is clear from the RBI Monetary statement on 6 […]
Read More High Policy rates sans supporting fiscal policy cannot tame inflationState government performance is going to matter in the coming months of fiscal and economic stress. The national performance will depend in the near term, crucially, on how the better-performing states pull their weight. One criterion of state performance is the budget allocations for fiscal 2023-24 starting April 1st and the outlook on fiscal rectitude. […]
Read More Can flying geese-Gujarat, Maharashtra, Tamil Nadu-Power India’s growth with stability?In India, the Union government takes on a much broader fiscal mandate than is necessary. Some of this is driven by the constitutional allocation of tax mandates, which favor tax flows to the Union government. Nearly 20 per cent, on an average, of a state government’s revenue flows in a “waterfall arrangement” from the Centre […]
Read More Indian Economy: Reading the Tea LeavesOur garden is full of goodies come and get what you need. This is what Finance Minister Sitharaman conveyed to the people (and voters) of India in her 2023-24 budget speech. Adding to the ever deepening gift bag that the Modi administration has held out to voters since 2015, the budget not only slashed income […]
Read More Budget Bounties 2023-24Book Review The Connections World: The future of Asian Capitalism Author: Simon Commander & Saul Estrin Publisher: Cambridge University Press Pages: 253 Price: £74.99 The “Asia” that this book addresses spreads northwards across the Pacific Ocean from Indonesia till the borders of China, North Korea and Japan and westwards to Pakistan on the Indian Ocean, […]
Read More Saving Asia from Stalling Growth
Opinion India 