"Truth stands, even if
there be no public support. It is self-sustained."
—Mahatma Gandhi (Indian,
1869-1948)
Word for the day
Littoral (adj)
of or relating to the shore
of a lake, sea, or ocean.
Malice towards none
If your child is using the
same shoe for more than a year, it does not necessarily mean that he/she has
become more responsible or careful. It may also mean that he/she has stopped
growing.
First random thought this morning
Delhi High Court recently decriminalized begging. Henceforth,
begging in Delhi will not be crime. Though, it is not clear if it makes begging
a legitimate vocation and add to the number of job opportunities.
In the meanwhile, contours of New Delhi Smart City project finally
defined:
High speed Wi Fi in Connaught Place Area (not Rajeev Chowk?!); 4
mechanical road sweepers; 2 litter picking machines; 10 Auto tippers; smart
poles; solar tree; ideation center; 10 LED interactive screens; 2 hi tech
nurseries and a garden; release of a book titled "Green and Colorful NDMC
- A Transformational Journey".
Would be useful to note that NDMC area, being seat of the central
government and host of all foreign missions, is the highest spend area in the
country.
Economic and market review - 3
Most analysts and economists forecast Indian economy to grow
between 7.2% and 7.5% in FY19 as well as FY20. Growing at this rate, India is
popularly touted to be the fastest growing economy in the world. Nonetheless,
the opinion around India's macroeconomic fundamentals has never been so
vertically divided in past couple of decades at least.
On one side of the spectrum are the global agencies like IMF &
ADB etc., and many international brokerages that rely primarily on the
government propaganda for their opinion. This set of commentators and analysts
have used hyperbole like "...an elephant that is ready to run";
"...a potential safe haven in global turmoil"; etc., to describe the
state of Indian economy.
I personally am delighted to read the comments and opinions from
this group. It makes me feel proud and good.
On the other side of the spectrum are many independent analysts,
economists, senior bankers like Deepak Parekh, and industrialist like K. M.
Birla etc., who believe that all may not be well with the Indian economy and
macro fundamentals may actually be weakening gradually.
Drawing from the thoughts of both these factions, my views on the
current macroeconomic conditions in the country are as follows:
(a) Indian economy has
mostly recovered from the disturbances caused by replacement of all high
denomination currency notes in late 2016 (popularly termed demonetization); and
implementation of a common nationwide Goods and Services tax (GST) to replace a
plethora of state level and central taxes. Normalized for these two events, the
economy continues to grow at a sub-optimal or below potential rate.
(b) The capacities created
in many core sectors during past decade or so are still not fully utilized.
Despite marginal improvement in recent months, the visibility is still poor for
fresh capacity additions in core sectors like telecom, power, railways,
shipping, civil aviation, corporate banking, mining, capital goods
manufacturing etc.
(c) After expanding for
couple of years, the government is shrinking its consumption as well as capital
expenditure to sustain fiscal discipline.
(d) The debt and reserve
profile of government has worsened in past couple of years. The proportion of
short term debt has risen materially as compared to the past episodes of
external shocks, making India vulnerable to external shocks.
(e) Current account
balance is worsening, putting pressure on currency and yields.
(f) Monsoon so far has
been sub optimal.
(g) External risks have
risen materially in recent months.
...to continue on Thursday
No comments:
Post a Comment