"One of the first conditions of happiness
is that the link between Man and Nature shall not be broken."
—Leo Tolstoy (Russian, 1828-1910)
Word for the day
Winkle (v)
To pry (something) out of a
place.
(Source: Dictionary.com)
Malice towards none
Heard many parts of the parliamentary debate on intolerance.
(a) Found the entire debate intolerable.
(b) Failed to understand what MPs were actually debating about.
First random thought this morning
I feel the whole problem lies
in the assumption that our elected representatives are demigods and therefore
infallible.
Half the intolerance and frustration
will go if we change our assumption and accept that the politicians are normal
human being like ourselves and would do whatever it takes to protect and
promote their vested interests.
The next logical step would be
to elect only those people whose vested interests are aligned to common men and
not those who promise to 'provide for common men' from the riches they will
make through their political election and social elevation. If it sounds like
Marx, it's ok.
What's amiss?
The recent data about India's economic growth has triggered three
debates:
(a) The disaggregated data
does not corroborates the headline growth number. How to reconcile these two?
Is there a subterranean current in the economy which the disaggregated numbers
like corporate earnings, credit growth, PMI, capacity utilization, business
confidence, investment demand, gold demand etc. are not able to capture; or
there is some error in capturing the headline growth numbers?
(b) The new methodology is
globally more accepted and better measure to capture the economic activity. But
whether the jump it is showing in economic activity is really due to
incremental improvement or merely on account of the change in method? Some
analysts have highlighted that "perhaps deflators have been underestimated in the new GDP series because
services deflator has been pegged more to WPI than CPI. Correcting the CPI/WPI
ratio since the start of the new national accounts series, real GVA growth
could possibly be overestimated".
(c) Indubitably, the BRIC
peers of India are going through a challenging economic downturn. Same is true
with most other meaningful emerging markets. The debating point is whether TINA
(there is no alternative) puts India in a advantageous position to draw larger
share of global investment; or this actually makes India more vulnerable to
incremental deterioration in the global economic conditions.
I am not an economist and I certainly do not understand much of
the economic jargon. But I can confirm on the basis of what I have seen during
my frequent travels to various parts of the country in past few months
(including remote villages in Bihar Seemanchal area, rich farmlands of Western
UP, Punjab and Haryana, tribal areas of Chhattisgarh & Jharkhand, industrial
estates of Gujarat & Maharashtra and trading hubs of Delhi, Mumbai, Hapur,
Rajkot, & Surat etc.) that most traditional businesses and households are
facing multiple challenges and are seriously stressed.
From media headlines I find that the new age businesses, mostly
technology based start ups and e-retailers are throwing some big numbers, both
in terms of fresh investment and incremental revenue growth. I am not sure how
much these matter in the bigger picture of a US$2.5trn economy comprising
1.26bn people.
The good part of the data is that the 32bps QoQ jump in GVA was
mostly contributed by the higher government spending. The government getting
back to investment business is very encouraging. However, I will watch it for
two more quarters to confirm whether it is sustained or dissipated due to
higher revenue spending and political expediency.
From what I see, I may say that our economy may not deteriorate
much from here. However, I may not necessarily agree with view that we are
already in the "middle" of a recovery. At best we are just beginning
to recover and continue to remain fragile and vulnerable to potential global
shock......to continue
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