governance, political economy, institutional development and economic regulation
Amid the doom and gloom of the world economy, there are encouraging signs that the Indian government is now taking tangible steps to reverse the worst aspects of the slowdown in India. Ministers take the lead This is a huge step away from the collective “Nelson’s eye” which was being turned to the crisis earlier. […]
Read More Early shoots of reforms revivalIt’s going to be a sombre Deepawali this year. If there were any doubts, the RBI Monetary Policy report of October 4 dispels them succinctly. Missing demand Global apprehensions abound around the policy and political uncertainty unleashed by the proxy war for access to markets between the US and China. Back home, slowing private demand […]
Read More Its’ smart to stoke private demandTough reform decisions are best taken in times of grave crisis not when the going is good. Economic reform, at the best of times, is highly disruptive. It makes little political sense, in the real world, to throw away the benefits of a stable, growing economy, in the hope that the future would be brighter […]
Read More BJP needs a consistent Economic IdeologyFinance minister Nirmala Sitharaman looked relaxed and happy while briefing the press in Panaji, Goa, on Friday about the proposed corporate tax reductions. Her estimate of the loss from the revenue foregone is Rs 1.45 trillion — equal to half the estimated defence expenditure this year. Normally, any FM under fiscal pressure would have mourned […]
Read More Reform in driblets keeps the party goingThe first 100 days of the Modi 2.0 government have been marked by lows and highs. Sadly, the lows are longer lasting, while the highs are transient, even in the short term. The biggest low was the Budget for FY 2019-20 in July, which was presented, in the absence of the late Arun Jaitley, with […]
Read More Modi 2.0 100 not out!It’s scarier going downhill than climbing to the top. Whilst on the way up, the heavyweight of inertia is known and hence manageable. Going downhill, inertia accelerates descent in unknown ways. The economy is no different. Flab (public sector banks), poorly maintained brakes (uncompetitive private firms), worn gear cogs (lack of structural reforms) or inadequate […]
Read More Indian Economy – The great slideThe Reserve Bank’s decision to transfer Rs 1.76 trillion to the government as surplus follows the “golden mean” principle, often used by committees. This bonanza comes courtesy an “Expert Committee to Review the Extant Economic Capital” of the RBI, constituted in November 2018, which has now recommended a higher level of transfer as against the […]
Read More RBI plays White Knight to revenue strapped governmentFinance minister Nirmala Sitharaman made history merely by standing up to present the Union Budget on Friday — being India’s first full-time woman FM to do so. True to the forceful style of the BJP, she delivered the speech with zeal and conviction to the loud thumping of desks by the treasury benches with a […]
Read More Nirmala Sitharaman hits all the right buttons for a balanced budgetModi 1.0 was all about learning the ropes of national governance. Budget preparation and execution is a key ingredient. Budget purists cavil that budgets under Modi 1.0 were high on fuzzy motherhood goals and discretionary expenditure but low on schematic, multiplier enhancing allocations. Arun Jaitley’s five years as FM Rhetoric and poetry are part of […]
Read More Budget FY2020 – Marching to a different drum beatIt’s a terrible time to be a minister in the Union government. The economy is tanking under the weight of debt funded public expenditure and low private investment due to the lacklustre consumer demand. Private corporate headline growth is low on the back of low capacity utilisation, which hits government tax revenues adversely and casts […]
Read More Modi 2.0: Time for frugal good governance