Indian Economy News & Discussion - Nov 27 2017

[nachiket]

I think it is primarily because of inadequate road infrastructure and less to no parking spaces.

Old sins of city authorities coming back to haunt the entire country now. Every piece of available land is sold off to the highest bidder to build housing or commercial buildings. Even in the metros the concept of multi-story parking lots is non-existent outside of some office buildings and malls. The Municipal corporation has a firm belief that providing for public parking spaces is not their responsibility.

This has an even worse effect in our cities since the roads in most places are already tiny. With no alternative parking spaces available anywhere, all the roads are filled with parked cars making them even tinier.

[A Nandy]

We need to expand the road network in our cities dramatically.

No we don't! We need to concentrate on metro, bus lanes and move people to public transport. If every person in the coming years buys a car, there will be no life left in our cities.

[ssundar]

Well, she is right about changing mindsets of folks about committing hard earned money on an EMI for a new car when it is more convenient to use Uber/Ola services to get around but she did not get in to why such a mindset is present in the first place.

The impact of Uber, etc. is global. Car sales are slowing down globally due to their impact and the "environment conscious" and "carefree" of the younger generation. The infrastructure reasons you outlined apply only to India, not the US or EU where the slowdown phenomenon is seen. But of course, the slowdown is sharper in India due to the additional reasons you mention.

This is a hard problem to solve because there have been many mistakes in the past which are now having an avalanche effect. In my extended family, I know multiple people who bought cars when they could neither afford nor needed one. India was driven for decades by the social pressure to have a vehicle beyond their needs. The attitude of youngsters now is a healthy correction.

[ssundar]

1) Demonetization caused more harm than good. Most of Indian economy is informal. Sucking out liquidity from MSME in one go will have ripple effects around the economy. What was the use anyway of 100% of India's population standing in queues for days? Anyone who had anything remotely to do with demonetization should be sent packing. Especially when GST and NPA recovery was in the pipeline. Yes, black money is bad, but to weed out black money you cant sent fire to the entire village. Leave alone my moral grouse with demonetization.

I would encourage you to watch Gurumurthy's talks about DeMo on YouTube. One of them linked below. Gurumurthy was one of the RSS ideologues behind the DeMo idea. DeNo was a well-intentioned initiative with many goals. But the Babu system executed it incompetently (Best Case Scenario) or colluded actively to defeat it (Worst Case Scenario). I do lean towards the latter in a 30:70 proportion.

Some goals were met but many were not. The system needed to be drained of black cash. It did not do that entirely due to the Babu collusion with the bad guys. I suspect there will be at least one more DeMo during this term of NDA to do yet another cleanup.

Black Money is not a headache that can be cured with one pill. It is a cancer that requires long-term chemo to kill. Chemo, unfortunately, kills many good cells along with the cancer cells. That is the nature of the beast.

[Jay]

I suspect there will be at least one more DeMo during this term of NDA to do yet another cleanup.

Regardless of the intention, DeMo proved to be a colossal failure where we shot ourselves in the foot. Now people are advocating for a second round of this same madness? Wah bhai wah. Who needs enemies when we ourselves can do the job of crippling our economy better than any enemy. Until Namo government does a thorough post mortem of how DeMo was done and the results of it, this government should not attempt anything like this again. We already spent a lot of effort to get rid of congoons and their cronies to let them back in again to rule the country because of something utterly stupid like Demo. No thank you!

[Mort Walker]

Demo had a purpose to pull black money in and make it white and then know where it came from. It served the purpose to let the government know where cash was coming. Surajsan had lots to say about it and can comment more.

[Vivek K]

Instead of crying politics - look at incentivising industries. Look at options to revive sick units. Instead of rewarding corrupt taxmen, reward only those bureaucrats that are successful in reviving industries. Is it better to have Kingfisher and Jet closed or working?

Japan provided money at zero percent (IIRC) and US is wanting to do the same. If not zero provide really cheap loans to sick units/restructure debt and waive interest piled up at huge interest rates.

[Mort Walker]

Instead of crying politics - look at incentivising industries. Look at options to revive sick units. Instead of rewarding corrupt taxmen, reward only those bureaucrats that are successful in reviving industries. Is it better to have Kingfisher and Jet closed or working?

Japan provided money at zero percent (IIRC) and US is wanting to do the same. If not zero provide really cheap loans to sick units/restructure debt and waive interest piled up at huge interest rates.

I agree. Manufacturing will pull millions out of poverty more than any other government program. Jet Airways as of this summer had a bunch of jets sitting around Mumbai airport. It was a sad sight to see.

[Jay]

Demo had a purpose to pull black money in and make it white and then know where it came from. It served the purpose to let the government know where cash was coming. Surajsan had lots to say about it and can comment more.

Mort ji, this is the rhetoric I supported and understood why DeMo was done, but till now nobody knows what the results of DeMo are to validate this premise. If this os OT for this thread, happy to discuss this in DeM thread. What is clear is DeMo had a huge dampening effect on the economy and this combined with other missteps magnified its shortcomings.

[Kaivalya]

Rahulsidhuji,

Forgive my tardy response - had to deal with a medical emergency at home.

I agree that managing to fiscal target might be myopic. Here is what I am grappling without appropriate data.

Assertion 1 : Auto Industry slowdown hurts GDP.

It seems like this argument is not supported by data. I see 6-14% of GDP attributed to auto industry. Given that exports, clv, 2 wheeler etc seem to be ok, the impact to GDP seems limited.


Assertion 2 : Slowing GDP hurts auto industry.

It seems like this could be true - given that cars etc are bought from disposable income during good times. If other industries are plodding along why treat auto industry alone with gloves - car manufacturers should know the cyclical nature of their business and economy.Maybe investments into other industries might impact GDP more

In any case, it looks like renewing buses, cars etc from a government technical refresh perspective might have been done in the past. I am still looking for previous governments investment vehicles for renewal. Assuming it is still warranted for the government step in to help - we need to make sure that we are not encouraging bad behavior as well as the magnitude of the intervention.

Media tends to magnify anything it focuses...My difficulty is to find supporting data either way like this JNNURM referred in this article https://www.asianage.com/opinion/oped/0 ... onomy.html

[chola]

I suspect there will be at least one more DeMo during this term of NDA to do yet another cleanup.

Regardless of the intention, DeMo proved to be a colossal failure where we shot ourselves in the foot. Now people are advocating for a second round of this same madness? Wah bhai wah. Who needs enemies when we ourselves can do the job of crippling our economy better than any enemy. Until Namo government does a thorough post mortem of how DeMo was done and the results of it, this government should not attempt anything like this again. We already spent a lot of effort to get rid of congoons and their cronies to let them back in again to rule the country because of something utterly stupid like Demo. No thank you!

I wrote about this when it was happening.

Black economy is still real economy. REAL jobs and wealth are generated from it. And in India's cash economy, practically everyone -- not just the fat cats -- engages in this. Your rickshaw wallas to your IT CEO and everyone in between do transactions in "black" but REAL money everyday.

DeMo was a government tantrum. If the GOI can't TAX that money then we are going to simply wipe that money clean from the economy. That is real wealth being taken out from the economy because, to be honest, the GOI is angry at money it can't take a cut of. We threw the baby out with the bathwater.

[Supratik]

You see everyone cheats in exams in UP, Bihar and other places. Asking them to stop may result in millions failing. So we should not ask them to stop cheating forcefully. This will make India a technological superpower that will then compete with Japan and America.

With this kind of logic India will remain where it is.

And also the logic and outcome of demo and GST have been clearly explained on this forum in multiple threads and for several years now. If you have not been able to still get it then may be this is not for you just like particle physics may not be for you.

Formalization will have a price like it or not but an informal black economy will have an even bigger price just like a small tumor eventually becomes a malignant cancer if not dealt with early.

Yes, just like you will fail initially when you are asked to stop cheating. The solution is to not go back to cheating but to study harder.

There has been a slowdown. The solution is to find out why by studying each sector, finding the problems and then looking at solutions.

[Supratik]

Govt announces several measures to reverse economic slowdown.

https://www.moneycontrol.com/news/busin ... 36101.html

GST council is likely to meet and announce tax cuts. DTC is likely to be implemented may be in next budget.

[Mort Walker]

Demo had a purpose to pull black money in and make it white and then know where it came from. It served the purpose to let the government know where cash was coming. Surajsan had lots to say about it and can comment more.

Mort ji, this is the rhetoric I supported and understood why DeMo was done, but till now nobody knows what the results of DeMo are to validate this premise. If this os OT for this thread, happy to discuss this in DeM thread. What is clear is DeMo had a huge dampening effect on the economy and this combined with other missteps magnified its shortcomings.

It did have a dampening effect particularly in limiting real estate prices in some places. Demo brought the informal economy down.

[Vivek K]

Agree Mort! DeMo has the effect of making India behave better. So naturally it has impacted the economy. Once we learn how to walk without black money crutches, there will be ample opportunities.

In the interim - turn the bureaucracy from an anti-industry group of bandits to a pro industry smart system. Revive key industries with incentives- like airlines, auto, pharma etc. Also launch an infrastructure building drive to provide employment to poor. Don’t use PWDs though.

[Guddu]

It is worth noting that the United States ranks in the top 5 in 2017 after having ranked in 12th place as recently as 2014. The rankings of other large economies in this year’s index are Japan (17th), Germany (20th), Italy (46th), France (50th), Mexico (76th), Russia (85th), India (79th), China (113th), and Brazil (120th). The 10 lowest-rated countries are: Iraq, Republic of Congo, Egypt, Syria, Democratic Republic of Congo, Angola, Algeria, Sudan, Libya, and lastly Venezuela.

https://www.cato.org/economic-freedom-world

iNDIA RANKINGS 1980 1990 2000 2005 2010 2015 2016
Rating (Rank) Rating (Rank) Rating (Rank) Rating (Rank) Rating (Rank) Rating (Rank) Rating (Rank)
Summary Ratings (Rank) 5.02 (58) 4.79 (83) 6.22 (79) 6.71 (75) 6.39 (107) 6.61 (98) 6.63 (96)

Pak from 1980 onwards
4.25 (80) 4.81 (81) 5.55 (105) 6.09 (103) 6.17 (120) 5.92 (130) 6.00 (132)

Note the rapid worsening in Paki rankings..exponential decline ?

Interactive map https://www.fraserinstitute.org/economi ... &year=2017

And in 2019 Pak makes up the illustrious rear end, the smaller numbers are the worsening of rankings for pak.
136 Pakistan 5.91
138 Gabon 5.88
139 Guinea 5.86
140 Cameroon 5.84
140 Yemen, Rep. 5.84
142 Niger 5.83
143 Ethiopia 5.72
143 Iran 5.72
145 Zimbabwe 5.69
146 Argentina 5.67
147 Myanmar 5.63
147 Sierra Leone 5.63
149 Mozambique 5.60
150 Chad 5.42
151 Central African Republic 5.23
151 Guinea-Bissau 5.23
153 Iraq 5.21
154 Congo, Rep. of 5.08
155 Egypt 5.05
155 Syria 5.05
157 Congo, Dem. Rep. 5.00
158 Angola 4.83
159 Algeria 4.77
160 Sudan 4.67
161 Libya 4.45
162 Venezuela 2.58

[Kaivalya]

https://www.sbi.co.in/portal/documents/ ... 90175501f1

Auto Sector slow down analysis : Primary reason for auto sector slow down is attributed to NBFC liquidity - SBI Eco wrap publication

And yes...they also talk about used car market, uber/Ola model impact etc

[krisna]

I am no economist nor do understand it very well.
Just a statement- may be stupid in its content.

https://en.wikipedia.org/wiki/List_of_c ... per_capita

USA 811/1000 population
Japan 615/1000
Germany 561/1000
UK 470/1000
European union 543/1000
India 22/1000

http://statisticstimes.com/economy/sect ... -india.php
http://planningcommission.nic.in/data/d ... ta=datatab


share of automobile sector in India GDP is around 7.5%.


auto density in India per population is miniscule relative to other economies of similar scale.
Mostly in urban centers. Yes population is increasing due to urbanisation. Despite this we give huge importance to auto industry as done in western economies.



For large scale employment, we need certain sectors like agriculture(traditionally largest but declining)
services sector industry (including automobiles etc) and tourism sectors.

Especially tourism sector holds a lot of potential as India as a whole has lot of historical places. many Indians at local level have some knowledge of local history. Need to harness the potential to generate employment and the economy thru this sector also. Huge infrastructure improvement and swach Bharat esp in pilgrimage and tourist places needs to be done.
ex- France with much less history has huge tourism than India.

Automobile and services sectors need relatively huge skills and is expensive for similar generation of employment and economy.

[jpremnath]

^^ The automobile industry takes a big chunk of our manufacturing not because the govt actively encouraged it. It is because the nature of the industry is that it becomes noncompetitive to import and sell fully assembled cars when the margins are so tight. The same cannot be said about the rest of the manufacturing sectors barring FMCG. Our tax structure and labour laws are punitive. Adding to that is poor infrastructure which makes logistics expensive (it makes up 13-15% of price while global avg is 6%). All these means, for someone in retail, it is cheaper to import from ASEAN/China than to make it in India. Even in FMCG, you can see that our exports are negligible, when MNCs and desi Inc should be leveraging their scale here for competitive exports. Here in GCC, it hurts to see even the Maggi noodles packs are imported from Malaysia. This is a country which has higher wages and located farther than us. It doesnt make sense. Nilamel is a popular company here which is originally based in Kerala and has good products in packed foods segment. They have drinks based on desi stuff like coconut, melon etc...My favourite is their tamarind drink. Guess where it is made,,,...Vietnam!! We are a major agricultural producer, but our policies in agricultural procurement and sales doesnt encourage value addition.

[A_Gupta]

Another shadow financier in India has defaulted on a debt repayment, signaling the nation’s yearlong credit crisis is far from abating.

Altico Capital India Ltd., a non-banking finance company that focuses on lending to the real-estate sector, didn’t pay 199.7 million rupees ($2.8 million) of interest on borrowings from Dubai-based Mashreqbank PSC, Altico said in an exchange filing on Thursday.
....
....
“The operating environment for real estate players has become extremely challenging, with the tepid sales velocity of residential units,” India Ratings said on Sept. 3. “Altico’s loan book, of 69 billion rupees in June 2019, has exposure to real estate developers, many of whom have weak and stretched credit profiles.”

https://www.bloomberg.com/news/articles ... redit-woes

PS:
https://www.bloomberg.com/news/articles ... pur-sector

As many as 560,000 homes worth of 4.5 trillion rupees ($65 billion) stuck or delayed across the top seven Indian cities, according to Anarock Property Consultants. These stalled projects are at the center of slowdown in the country’s property market and key reason for mounting default risk of developers.

[Kaivalya]

A_Guptaji,

+1. I am seeing a common pattern in auto sector, agriculture,real estate etc. I am beginning to believe that Credit crisis is the primary reason for the slowdown and has been working against the economic activity for a while now. I am going to look to understand this NBFC led credit crisis in more detail

[Rishirishi]

A_Guptaji,

+1. I am seeing a common pattern in auto sector, agriculture,real estate etc. I am beginning to believe that Credit crisis is the primary reason for the slowdown and has been working against the economic activity for a while now. I am going to look to understand this NBFC led credit crisis in more detail

Cars are not due to credit issues. If that had been the case people would have bought cheaper cars, or the car companies would have offered the loans. People are opting for Uber/Ola, as it is a decent option to owning your own car.

A good chunk of the flats were being built on speculation. The bonanza was investor driven. Now there is oversupply of flats, and users are opting to rent or purchase ready built flats.
All "stranded" home buyers had the option of purchasing a ready made flat. But they choose to book flats at a huge discount. They should have know the risk. But it is sad any way. People worked hard for that money.

For agri I do not know. But doubt it is becase credit crunch.

People forget that the economy is still growing by over 5%, and remain one of the fastest large economies of the world. Poverty is reducing, electricity production is going up (a bit).

[Picklu]

For a developing country, the most useful industry is construction as it employs the max number of lower skill employee. DeMo landed a crushing blow to the working part of indian construction industry i.e. real estate. The other part, infra development, were already in comma due to the environment and land acquisition policy of upa.

Hence the current 20000 crore stress fund is to revive this sector. Whatever black money were gone due to DeMo from this sector, will be recouped.

[kit]

I am no economist nor do understand it very well.
Just a statement- may be stupid in its content.

https://en.wikipedia.org/wiki/List_of_c ... per_capita

USA 811/1000 population
Japan 615/1000
Germany 561/1000
UK 470/1000
European union 543/1000
India 22/1000

http://statisticstimes.com/economy/sect ... -india.php
http://planningcommission.nic.in/data/d ... ta=datatab


share of automobile sector in India GDP is around 7.5%.


auto density in India per population is miniscule relative to other economies of similar scale.
Mostly in urban centers. Yes population is increasing due to urbanisation. Despite this we give huge importance to auto industry as done in western economies.



For large scale employment, we need certain sectors like agriculture(traditionally largest but declining)
services sector industry (including automobiles etc) and tourism sectors.

Especially tourism sector holds a lot of potential as India as a whole has lot of historical places. many Indians at local level have some knowledge of local history. Need to harness the potential to generate employment and the economy thru this sector also. Huge infrastructure improvement and swach Bharat esp in pilgrimage and tourist places needs to be done.
ex- France with much less history has huge tourism than India.

Automobile and services sectors need relatively huge skills and is expensive for similar generation of employment and economy.

Somethings are not quite what it looks like. Ever wonder why railroads ( Railways ) are not a form of popular transport in the US and why there are so few high speed rail lines there ? Find the answer and then you see how different sectors can be " managed " to suit the private sector / Govt contractors etc . Having said that exports are the key and " not to put all eggs in one basket " , diversified economies in manufacturing fare better.

[kit]

A_Guptaji,

+1. I am seeing a common pattern in auto sector, agriculture,real estate etc. I am beginning to believe that Credit crisis is the primary reason for the slowdown and has been working against the economic activity for a while now. I am going to look to understand this NBFC led credit crisis in more detail

Cars are not due to credit issues. If that had been the case people would have bought cheaper cars, or the car companies would have offered the loans. People are opting for Uber/Ola, as it is a decent option to owning your own car.

A good chunk of the flats were being built on speculation. The bonanza was investor driven. Now there is oversupply of flats, and users are opting to rent or purchase ready built flats.
All "stranded" home buyers had the option of purchasing a ready made flat. But they choose to book flats at a huge discount. They should have know the risk. But it is sad any way. People worked hard for that money.

For agri I do not know. But doubt it is becase credit crunch.

People forget that the economy is still growing by over 5%, and remain one of the fastest large economies of the world. Poverty is reducing, electricity production is going up (a bit).

India actually needs higher rates of growth of 7 - 10 % to power itself into the top 3 ranks if it wants to be there in a decade ..at least with wealth creation in its middle and lower class and lower growth rate will likely tend to pool it all at the higher class. 5% is small consolation.

[Mort Walker]

The auto manufacturing sector is being hit by consumer credit automobile lending, GST inconsistency in auto parts and finished vehicles, and the forced implementation of Bharat Standard VI emissions standards by car makers - BS6 raises costs of vehicles because BS5 was bypassed and there isn't enough time to implement by April 2020. It seems GOI just copied emissions standards that Europe is doing without thinking how much of an impact it will have on manufacturing and employment.

[yensoy]

Yes, and it is sad that FM put the onus of that decision on the Supreme Court. While respected SC decision is very much a reality, the learned judges are not scientists, and I am not sure what kind of alternative proposal was presented to them and whether they looked at it in total, i.e. a cost benefit analysis. More fundamentally, why did this administrative decision get adjudicated by the SC? Because our bureaucracy has basically failed in its duties and has offloaded the job of governance to the courts; and now the trend in the nation is to drag the courts into every minor grievance in order to realize the plaintiff's objectives.

Now we have first world standards for pollution control for personal vehicles, and international standards for traffic violation fines, but 3rd world levels of income and infrastructure. This is going to cause pain. Poor Ola drivers, many of who were shown very rosy pictures while they took on the car loans, will face steep traffic fines for small infractions which they must cover from their already meager incomes.

[Kaivalya]

A_Guptaji,

+1. I am seeing a common pattern in auto sector, agriculture,real estate etc. I am beginning to believe that Credit crisis is the primary reason for the slowdown and has been working against the economic activity for a while now. I am going to look to understand this NBFC led credit crisis in more detail

Cars are not due to credit issues. If that had been the case people would have bought cheaper cars, or the car companies would have offered the loans. People are opting for Uber/Ola, as it is a decent option to owning your own car.

- please take a look at my earlier post ( SBI report ) . While uber/Ola has an impact, mutual fund exposure to nbfcs have reduced by 64000 crores (that we know about ) from 2.66 lakh crores during the period Jun 18 to Jun 19. In a macro level this magnitude of funding makes a difference especially because it does not differentiate between good buyers/bad buyers/good real estate project/bad real estate speculation. I.e everything suffers.


A good chunk of the flats were being built on speculation. The bonanza was investor driven. Now there is oversupply of flats, and users are opting to rent or purchase ready built flats.
All "stranded" home buyers had the option of purchasing a ready made flat. But they choose to book flats at a huge discount. They should have know the risk. But it is sad any way. People worked hard for that money.

- please see comment above. I am trying to get macro level differences in the funding into nbfcs or nbfcs going flat like Arjunji pointed out to figure out net difference of capital into the economy like rahulji pointed out. Then we can probably find the differences in investment level from the government perspective to help regain the growth.

For agri I do not know. But doubt it is becase credit crunch.
- I saw an ICICI report with aggregate funds availability for agriculture. I haven't figured out how to attach images as I am a newbie. Will follow up.


People forget that the economy is still growing by over 5%, and remain one of the fastest large economies of the world. Poverty is reducing, electricity production is going up (a bit)

Absolutely I am bullish about that growth getting much better from fundamental changes like livestock vaccination etc. CNBC is already calling for this slowness to be reversed in another 6 months. I assume smart money in stocks are already flowing in...but that is just my speculation
.

[sivab]

[kittoo]

I think it is primarily because of inadequate road infrastructure and less to no parking spaces.

Old sins of city authorities coming back to haunt the entire country now. Every piece of available land is sold off to the highest bidder to build housing or commercial buildings. Even in the metros the concept of multi-story parking lots is non-existent outside of some office buildings and malls. The Municipal corporation has a firm belief that providing for public parking spaces is not their responsibility.

This has an even worse effect in our cities since the roads in most places are already tiny. With no alternative parking spaces available anywhere, all the roads are filled with parked cars making them even tinier.

Must appreciate Pune municipal corporation for providing public parking spaces at a lot of roads. Forwarding thinking at least in this aspect. Its a pleasure to drive and find public parking spaces clearly marked and maintained. Kudos.

[Uttam]

Here is an interview of CM Yogi. Even if 1/2 of what he said is correct than I see a clear path for UP to come out of its laggard status.

I am skeptical about CM Yogi's claim of quadrupling UP's GDP in 6 years. However, his aggressive approach to invite businesses and keep them in UP is something I never saw in last 30 years. Hats off.

Lot's of interesting details:

https://www.hindustantimes.com/india-ne ... njN4M.html

Here are some quotes:

We’ve prepared a work plan. The pace at which we were working, it would have taken UP 12 years to become a trillion-dollar economy. We have now increased our economic speed and can achieve the target in six years.
.............
When we came to power, Korean multi-national Samsung was winding up in the state............
I told them that they should call the company chairman from South Korea to meet me. The Samsung chairman came, and after the meeting, I directed my team that all problems faced by the company should be resolved in next 15 days.Today, Samsung has the biggest mobile manufacturing facility in the world in Noida to manufacture mobile phones.
.............
Another example was TCS [Tata Consultancy Services] leaving UP...........I straight away called up company chairman Ratan Tata and urged that his company exiting UP at the time would send wrong signals...........Today, TCS is in Lucknow and now opening a huge centre in Noida with 30,000 new jobs.
.............
We have already started the one district, one product scheme under the MSME department to promote traditional industry, which requires minimal investment but tremendous job opportunities. These MSME clusters are already present on ground in the state to attract investment on ground of existing distribution.
.............
We branded the last Prayagraj Kumbh to show case our event management capabilities with an eye towards promoting tourism. ...
we have created a Braj Teerth Development Board so that foreigners and Indians spend time and money in western UP....
We want to brand Shivratri with Kashi and are doing international promotion for the Buddhist circuit in Varanasi.....
.............
We have no shortage of power. We are going to double the power production as compared to 2016, just as our consumption has also doubled during the same period............
We have been successful in reducing the transmission distributions losses from 36% to 24% through underground cabling. In the past 30 months, 167,000 spots have been electrified with 11 million people given electricity connection either free or basic charges. ....
.............

Do you think I am single-handedly giving these results? This is team work. If we had not worked, then could we have given 2.5 million houses to people, toilets to 26 million people, electrified 167,000 spots, electricity connections to 10 million people, 150 million rations cards to people. All this has happened due to coordinated efforts of our team.
.............
Anti-corruption efforts depend on the leadership. If the leader is clean, this will impact the entire bureaucracy. But if the leader is corrupt, then how can you expect subordinates to be honest? In my government, if the corrupt do not mend themselves, then they will be taken to task as per law. I have retired or dismissed 600 officials in the past 30 months on this count.
.............
Law-and-order in UP is the best in the past decades as there has been not a single communal riot or ransom case in the past 30 months.
.............
We have done three big events this year with the Prayagraj Kumbh taking the top spot as more than 240 million pilgrims attended the event.

15 Pravasi Bhartiya Diwas in Kashi with more than 7,500 representatives belonging to 76 countries attending the show

.............

[VinodTK]

London Overtakes India’s Financial Capital in Rupee Trading

Bloomberg) -- London has overtaken India’s financial capital Mumbai to become the top center for trading the nation’s currency. That’s adding to a sense of urgency among local authorities to deepen the onshore market.

Average daily volumes for rupee in the U.K. soared to $46.8 billion in April, a more than fivefold jump from $8.8 billion in 2016, according to the latest survey from the Bank for International Settlements released this week. That exceeded the $34.5 billion recorded in India.

Trading in dollar-rupee offshore non-deliverable forwards increased threefold over the three-year period, the BIS report showed. Alive to the growing size of the offshore rupee market, India’s government and the central bank have been looking at ways to improve access for overseas investors and offer them more products to ramp up volumes at home.

“The sharp increase in offshore FX market activity re-establishes that it could amplify currency volatility in the domestic currency and also reduce the effectiveness of policy steps taken to limit volatility during times of stress,” said Madhavi Arora, an economist at Edelweiss Securities Ltd.
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[vijayk]

https://theleaflet.in/squarely-blame-su ... a-jaising/
Squarely blame Supreme Court for economic slowdown’: Harish Salve in conversation with Indira Jaising
Besides the apex court, he held “faulty” implementation of the demonetisation policy partly responsible for the downswing.

A lot of big businesses which survived on the speed dial culture and ratcheted up a huge amount of debt, are now facing the flak. That has a dampening effect on the economy. But I think that is a cleanup we needed even if there is an economic price in the short term.

Having put that to one side, I squarely blame the Supreme Court. I can understand holding people responsible for the wrong distribution of licenses in 2G… Blanket cancellation of licenses where foreigners are investing… see when a foreigner invested it was your rule which said he must have an Indian partner. The foreigner did not know how the Indian partner got a license. Foreigners invested billions of dollars, and with one stroke of the pen, the Supreme Court knocked all of them out. That’s when the decline of the economy began.

Foreign investment became risky — retrospective change in Vodafone. People started wondering, the great strength of India was, people felt, yes we know the bureaucracy is a problem, we know your income tax is a problem but the courts there will give us justice. Vodafone removed that confidence which people had. People now had to factor in – you win in the tribunal, they will make a retrospective law and change it.

So the Income-tax department is virtually setting the agenda for the Parliament. Now that on an international level, I now advise clients overseas, when they come and say, can you win the case? I say, yes I can win the case, and then what if there is a retrospective law, will it be valid? Of course, it won’t be valid. Then how can we invest? I say it’s a risk. So what happens immediately? And I’ll tell you why I’m saying this. We want a 25 percent return; then we will invest. We won’t invest otherwise…

IJ: Surely, that’s beyond all expected returns for any investor. Which investor can ask for a 25 percent return?

HS: So you are looking at risk. You are willing to gamble at 25 percent. You won’t gamble at 15 percent So what does Café Coffee Day have to do? Whom do you blame? You blame the uncertainty, and two elements have created uncertainty. One is the executive government, the way your Enforcement Directorate (ED), your Income Tax (department) work.

An Income Tax Officer disallowed software export to IBM, saying that IBM has not proved that it is in the software business. He said, all the money, the billions of dollars that IBM centres in India earn, are actually money laundering from the US.

You cancelled coal mines by one stroke of the pen, without examining the merits of every case. Much genuine foreign investment in the coal industry went flat. Then what happened? Indonesian coal and other world coal prices softened up. It became cheaper to import. Correct? A few million people are without jobs in India. Indian coal mines are lying closed, and we are importing coal. That is putting pressure on the economy.

Iron ore mines. I must say, I’ve read that judgement of the Supreme Court and have always fought for the environment. That judgement is a howler. You’ve shut down all iron ore mines — iron ore cases of Goa. Justice Pattnaik’s bench opened the Goa mines. There were people who invested in a barge. You know how Goa works. People who bought barges, people who bought trucks, you shut down.

So then, demand falls. So, this is how you unravel and believe me, the Government of India sent seven of their senior secretaries to consult me on how to deal with that Supreme Court judgement, and one of them said that this judgement will cost India 1 percent plus of GDP, and that has happened.

They said 30-40 percent of the Indian informal economy is not in the books. You know, your plumber who fixes your tap, the fruit vendor, vegetable vendor who comes to your house and sells vegetables, they are below the radar. They all sell in cash; they all work in cash. There was no transition facility made for them. It is fantastic to transition them into the digital economy.

Whether demonetization, the way it was implemented, was the only way? I don’t know enough to say that it was. In the short term it has definitely impacted your economy. The good which has come out of it is that a large number of bogus companies have been exposed and there is a lot of cleanup going on, so some good has come out of it. But yes, in the short term, it did affect your informal economy. I am not holding any brief for those who had sack-fulls of cash in their house and therefore burnt the cash.

[vijayk]

https://www.rediff.com/business/report/ ... 190918.htm
Trump may offer trade deal to Modi, sign it in India
Indications are that a 'preliminary agreement' may be unveiled during Prime Minister Narendra Modi's visit to the US this week, with President Trump signing the final deal in India in November.

The proposal would restore India's status as a beneficiary of the Generalized System of Preferences program, or GSP, thereby lowering the price of many Indian-made goods in the United States. In exchange, Modi would agree to make it easier for American companies to work in India in a few key sectors,' the Examiner reports.

Incidentally, on Tuesday, 'a bipartisan group of 44 United States influential lawmakers has urged the Trump administration to reinstate India's designation as a beneficiary developing nation under the key Generalized System of Preferences trade programme as part of a potential trade deal between the two countries,' reports Press Trust of India, a status that was terminated by the Trump administration in June this year.

'In a letter to US Trade Representative Robert Lighthizer, the House members suggest an "early harvest" approach that "would ensure that long-sought market access gains for US industries are not held up by negotiations over remaining issues",' reports PTI.

The proposed agreement would help the Trump administration tout a success story in the midst of an ongoing, bruising trade war with China, and takes forward US Secretary of State Mike Pompeo's statement on "forging a new kind of cooperation" with India.

[arshyam]

So back to the status quo from our PoV. The Americans have learned well from the Chinese - create some issues, then offer to resolve them for some other concessions elsewhere. Net result, we are back where we started.

[M_Joshi]

So back to the status quo from our PoV. The Americans have learned well from the Chinese - create some issues, then offer to resolve them for some other concessions elsewhere. Net result, we are back where we started.

Not necessarily entirely true. We also created issues, e.g. with Amrerica's tech giants to open local data centers. These tech companies must have been lobbying hard in Washington to get India to stop this decision. It's possible it's one of our "concessions" in the upcoming status quo.

Edit : One more concession I hope Trump squeezes from India is land & labor reform making it easier for American manufacturing investment. 100 B$ in FDI will sure fire up Modi's belly to buldoze through thse tough legislations.

[arshyam]

So back to the status quo from our PoV. The Americans have learned well from the Chinese - create some issues, then offer to resolve them for some other concessions elsewhere. Net result, we are back where we started.

Not necessarily entirely true. We also created issues, e.g. with Amrerica's tech giants to open local data centers. These tech companies must have been lobbying hard in Washington to get India to stop this decision. It's possible it's one of our "concessions" in the upcoming status quo.

Edit : One more concession I hope Trump squeezes from India is land & labor reform making it easier for American manufacturing investment. 100 B$ in FDI will sure fire up Modi's belly to buldoze through thse tough legislations.

Thank you. If what you say turn out to be true, then it's even worse from our PoV.

[vijayk]

Is this true?

https://theprint.in/economy/funds-starv ... us/292189/
LIC put Rs 10.7 lakh cr in PSUs under Modi, almost same as investments in 6 decades to


When Modi govt came to power, LIC’s cumulative investment in public sector was Rs 11.9 lakh crore. At the end of FY 2018-19, it jumped to Rs 22.6 lakh crore.

[yensoy]

^^^^ The graphics artist at The Print needs to be fired.

[Manish_Sharma]

https://twitter.com/TVMohandasPai/statu ... 41632?s=20

Mohandas Pai
@TVMohandasPai
London overtakes Mumbai in rupee trading -FE
A sad day for India!Why India exporting our Rupee trading markets?Need urgent reforms or rupee will be controlled from outside ⁦
@PMOIndia
@narendramodi
@nsitharaman
@sanjeevsanyal