اخبار 1

If you saw India's financial position in the previous post, you could be excused for opining that we must cut expenditure. For most other countries, that would be the answer. But not for India. For India, the mantra has to be grow baby, grow. India is uniquely positioned. It has all the ingredients for rapid growth - a hitherto underdeveloped economy, a dynamic and large domestic market, a large and young population, an education ethic coupled with hard work (mostly), and all the institutions that can enable growth. The trouble is that it has been constrained all these years - first by socialist claptrap and second by the neta babu raj. You can see why growth has to be the single most important mantra for the next 10 years The only way to provide economic upliftment for large sections of the population is through facilitating employment. The only way to facilitate employment is through economic growth - not by giving doles under the guise of the NRGEA . Economic growth will lead to...

Continuing from the earlier post, we will attempt to understand, and then co create an economic manifesto for India. This is in the context of the upcoming Indian elections, where this blogger believes that Economic upliftment is the most important objective for the nation. Political parties are either completely ignoring, or not doing justice to an economic manifesto  Where they are publishing manifestos, they are mouthing platitudes like we will create X million jobs, we will abolish poverty, etc etc without a word as to "how". This series of posts cover only the economic tasks before the nation - not social or political or other  issues which are also important. Since this is a business blog, and this blogger believes that economic advancement is the most important priority for the country, we will focus exclusively on economics. In order to consider what should be the strategy ahead, we should firstly understand where we are. This post explains India's current financi...

Indian elections are around the corner – easily the most complex democratic exercise on earth affecting one in seven people in the world directly, and more indirectly. Democracy is all about choices. In order for that to succeed, the choices must be clear. The biggest issue facing India is economic – how to lift millions of Indians out of poverty and give the best possible economic advancement for as many Indians as possible. And yet, if you see the electioneering, there is total absence of economic policies or what the choices are. There are general myths , perceptions and blind loyalties on which the people are being asked to vote. No specifics at all.  In the area of economic policy, the front runner is arguing that he would replicate the success of Gujarat nationally.   That is fine, but how would he do it ? India is not Gujarat.   It is far more complex and requires an entirely different set of policies.   So what specifically   would he do to ensure “development” (his favourite ...

China exports far more than it imports. Everybody knows that.  Oversimplified , the difference between goods and services exports and goods and services imports is called the Current Account balance. It can be a surplus or a deficit. China has seen a surplus for a long time. India has seen a deficit for a long time. China's current account surplus reached a high of 10% of GDP in 2007. Under normal circumstances if such a chronic situation existed, the currency would rise making imports cheaper and exports costlier leading to an equilibrium. But China was controlling exchange rates, which led to massive imbalances in the world economy.  The US led the chorus terming China a currency manipulator. In any case, such huge imbalances affected the global economy in all sorts of ways. What to do about the problem ? Well, the problem has started to be solved by itself, in a way few would have anticipated . China's current account surplus has fallen to 2% of GDP.  What on earth has happe...