Indian Economy News & Discussion - Nov 27 2017

[disha]

Indian retail owners assoc. can work with GOI and use ONDC to setup apps for the Kirana stores. They can then become the edge delivery points.

[bala]

Indian retail owners assoc. can work with GOI and use ONDC to setup apps for the Kirana stores. They can then become the edge delivery points.

Yes, ONDC requires some additional work by enterpreuners to solve the supply chain issue. Amazon et al have consolidated warehouses where merchandize is stored and they pass on the shipping cost to the end consumer besides the cost of product. Overall you end up paying as much, sometimes Amazon waives off shipping costs when you order higher value items. Amazon is getting competition from Brick'N'Stone walas like Walmart, Target, HomeDepot, etc because pick up at store is free shipping cost. The Brick'N'Stone central warehouse to end-point destination is on same truck for other items.

The local Kirana store can be become the last mile point for end consumers. Say you want some fancy arts and crafts from Odisha, you can order on ONDC directly from Odisha vendor and pick up in local Kirana in Bengaluru, Kerala/TN. Some bulk shipping costs are charged.

Quite a bit of additional work is required by Indian Retail owners Association or some smart baniya who makes it their business model.

[chetak]

[chetak]

For a change, a thoughtful oped in ⁦@livemint by a former WTO director on how colonised Indian minds treat institutional reports from the West as gospel truth.

Must read.

[chetak]

During Modi years, India grew faster than other developing economies

During UPA, India's growth was slower

Above average growth in Modi years gives a $6.5 TRILLION surplus

UPA years are $2.5 trillion deficit

[Suraj]

Q1 GDP Official Data (pdf)

- After prior full year growth of a world leading 7.2%, this is a small drop to 6.7%
- Mostly on account of a drop in GFCE during election season, showing up as lower GVA in the tertiary sector.
- Primary and secondary sectors remain strong and services will bounce back in Q2
- GFCF almost at 35% of GDP now, a bell weather to accelerated forward growth momentum. It last reached this figure during the mid 2000s high growth period.
- Multiple momentum datapoints - steel output, electricity output, cargo at ports and airports, bank deposit and bank credit growth.

RBI continues to forecast another full year 7.2% growth and that remains likely. GDP will officially cross $4 trillion this year.

[gakakkad]

We are at the cusp of adding a trillion every year from 2027 onwards . Also compared to the last time the GFCF was > 35% , there are major structural changes in terms of wayyyy better infrastructure (both physical and fintech)and regulations and significantly lower corruption . The impact of those isn't linear . I won't be surprised at mid teens real growth spell at some point .

[JTull]

We are at the cusp of adding a trillion every year from 2027 onwards . Also compared to the last time the GFCF was > 35% , there are major structural changes in terms of wayyyy better infrastructure (both physical and fintech)and regulations and significantly lower corruption . The impact of those isn't linear . I won't be surprised at mid teens real growth spell at some point .

How's 7% of 4 trillion become 1 trillion? We're 10-15 years away at current rate of growth.

[Supratik]

It should be about $1 trillion dollars every 24-36 months at 10-11% nominal and 7-8% real.

[Suraj]

Investment as a percentage of GDP is a leading indicator of growth. This is due to the snowball effect of investments driving more investment and thus faster growth. In 2022-23, the GFCF was 33.3% and translated to 7% growth. In 2023-24 it was up to 34% and translated to 8.2% growth. This year, Q1 shows 34.8% GFCF as a percentage of GDP. I would wager that GDP growth will be close to or better than 8% again. This implies an incremental capital output ratio of around 4.1-4.4 .

Unlike in the mid 2000s, the government responsible for the improvement gets to rule the next 5 years, and if GFCF creeps up to 36-38% , then the recent ICOR suggests 9-9.5% growth.

Actual GDP does not growth by the real rate but by the larger nominal rate.

[Supratik]

The capital markets are booming but bank deposits are not. If this trend persists it is a sign that the transition to a market economy is now both deep and broad, and probably irreversible.

[S_Madhukar]

Bloomberg says LG tempted by IPO in India as they have a sizeable market share. Might be wanting to take advantage of the euphoria that is lacking now in other markets

[gakakkad]

It should be about $1 trillion dollars every 24-36 months at 10-11% nominal and 7-8% real.

Nominal growth rate will be 10-15% a year . 7% is real growth rate .That's how our GDP more than doubled in modi era (would have almost tripled had it not been for wuhan virus ).

[chetak]

CCI finds alleged collusion between Samsung, Xiaomi and other smartphone makers and Amazon, Flipkart: Report

Samsung, Xiaomi, and other smartphone makers allegedly colluded with Amazon and Flipkart, breaching Indian antitrust laws by favouring select sellers and launching products exclusively online, as per CCI investigations, Reuters reported.

Antitrust investigations conducted by the Competition Commission of India (CCI) have found that Amazon and Flipkart violated local competition laws by giving preference to select sellers, prioritising certain listings, and steeply discounting products, hurting other companies, Reuters reported this week.

The CCI's 1,027-page report on Amazon also said the Indian units of five companies — Samsung, Xiaomi, Motorola, Realme and OnePlus — were "involved in the practice of exclusive" phone launches in "collusion" with Amazon and its affiliates, breaking competition law.

https://www.livemint.com/companies/news ... 83670.html

[chetak]

[bala]

PM Modi In US | Modi meets top tech CEOs

https://www.youtube.com/watch?v=IrCHHrLdLw0

Modi ji meets top tech CEOs, thambi Pichai too and many others. PM Modi met and addressed CEOs of top tech firms including Google, NVIDIA, Accenture and others during his trip to New York. After the meeting these CEOs revealed what PM Modi told them about investing in India and his plans for make in India, how AI technology can be implemented better in India and more.

Hope this drives all the US honchos to invest heavily into India and make their do-dads within India. AI is of course the new buzz word (old statistics algos known for donkeys years put into new bottle) and keeping everyone enthused and relevant.

// My concern is to transform the banias in India to create the Indian versions of google, twitter, faceblock, nvidia, ibm, accenture. This requires a different thinking process and going after small incremental goals and eventually consuming the whole thing. Meanwhile Modiji should expand the DPI stack even further and usher in a complete digital India - babucracy, judiciary, state/local govt and more.

[gakakkad]

India has second highest unicorn numbers last few years . However a lot of indian unicorns move to Singapore or unkil etc for favorable tax environment.

There has been a lot of emphasis on black money etc .

I think we need a more favorable tax structure for startups . We also need to figure out of way of establishing selective tax havens .
Dual citizenship is an issue that needs to be figured out . Those are some of the things the government can help with to support more entrepreneurship. Ease of doing business definitely has improved massively last decade . But still some ways to go.

[Vayutuvan]

India has second highest unicorn numbers last few years . However a lot of indian unicorns move to Singapore or unkil etc for favorable tax environment.

If Harris becomes POTUS Unkil will have ginormous corporate taxes.

[S_Madhukar]

I thought GIFT city was to be a tax haven for India focused companies? I hope we can balance corporate tax rate for startups with the growth % that the Indian market will offer.

[Suraj]

Indian Foreign Exchange Reserves Cross $700 Billion

With a $12.5 billion rise over the prior week, India crossed the $700 billion forex reserves mark. As far as I’m aware India is the 5th country to ever grow its reserves above this level. China, Japan and Switzerland currently rank higher and India ranks 4th on the current list. Saudi Arabia once had reserves north of $700 billion but has dropped down a lot.

[Cyrano]

The upcoming EU carbon tax legislation will effectively end these FTA talks.

[chetak]

#Adani Group shines on the global stage.

Earns spot on the TIME's World's Best Companies list 2024.



https://in.investing.com/news/stock-mar ... 24-4427743

Ahmedabad, Sep 13

Leading integrated business conglomerate Adani Group on Friday said it has been featured in TIME magazine’s prestigious ‘World’s Best Companies of 2024’ list. The list was prepared in collaboration with Statista, a global industry ranking and statistics portal.

Notably, eight out of 11 listed Adani portfolio companies were considered in the evaluation, reflecting a comprehensive performance across the group. The other three listed companies are subsidiaries of these eight companies.

The recognised companies include Adani Enterprises (NS:ADEL) Ltd, Adani Ports and Special Economic Zone Ltd, Adani Green Energy (NS:ADNA) Ltd, Adani Energy Solutions Ltd, Adani Total Gas (NS:ADAG) Ltd, Ambuja Cements (NS:ABUJ), Adani Power (NS:ADAN) Ltd and Adani Wilmar (NS:ADAW) Ltd.

According to the company, the accolade highlights the Adani Group’s commitment to employee satisfaction, revenue growth and sustainability.

"This is further validation of the Adani group’s hard work and continuous efforts to push boundaries and deliver excellence across businesses," said the company.

The 'World’s Best Companies 2024' list, is based on a rigorous analysis across three key dimensions - employee satisfaction, revenue growth and sustainability (ESG).

The Adani Group is India’s largest and fastest-growing portfolio of diversified businesses with interests across energy and utilities, transport and logistics, natural resources and the consumer sectors.

[Cyrano]

Time has been well paid!

[chetak]

https://www.orfonline.org/expert-speak/ ... -and-logic

[Lisa]

The upcoming EU carbon tax legislation will effectively end these FTA talks.

India denounces ‘stifling’ EU carbon tax on imports

https://archive.ph/b1hPS

[Suraj]

Ratan Tata has passed away. A great servant to Indian economic growth who saw and led the company through the most dynamic period of Indian economic development. I hope Tata and Sons continues to grow in the hands of his successors.

[VinodTK]

^^^ True Patriot and great Indian

Live updates: Ratan Tata dies at 86 in Mumbai; tributes pour in

[arshyam]

He will be missed. Om shanti.

[bala]

The Parsis of Bharat have been outstanding citizens of Bharat. We have many examples, including Field Marshal Manekshaw.

I want to quote a statement given by the patriach of Tatas, Shri Jamsetji Nusserwanji Tata:

"What advances a nation or a community is not so much to prop up its weakest and most helpless members, but to lift up the best and the most gifted, so as to make them of the greatest service to the country"

The above is the true spirit of Tata group. Ratan Tata hired the best to lead his conglomerate to world leadership and excellence. All of this done within the context of Bharat to prove the possibilities of a nation given appropriate leadership. I hope each one of us dedicates ourselves to furthering the goals that Tata embodies for the nation sake.

{deleted}

[chetak]

Dr. Vidhu Shekhar@profvidhu

My latest article in The New Indian Express on the topic of Who Pays How Much GST in India. Oxfam's claim that 64.3% of the GST is paid by the poorest 50% in India has been widely circulated several times in various media outlets.

Inspired by a student's comment during a casual discussion on the Indian Economy, I investigated this assertion.

After analyzing detailed NSSO Consumption data and GST rates on over 400 items consumed by Indian households, the results revealed a stark contrast. The bottom 50% actually contributes 9.6% of the Total GST in India, debunking Oxfam's figure of 64%.

Related academic paper here: https://papers.ssrn.com/sol3/papers.cfm ... id=4979861

Vidhu Shekhar
Bharatiya Vidya Bhavan - S.P. Jain Institute of Management & Research (SPJIMR)

Date Written: October 08, 2024

Abstract

This study critically evaluates Oxfam's claim that the poorest citizens in India bear most of the Goods and Services Tax (GST) burden. Despite gaining significant media attention following its presentation at the World Economic Forum in Davos, Oxfam's assertion lacks robust empirical support and suffers from several methodological shortcomings. This paper presents a comprehensive analysis of GST contributions across different income groups by leveraging detailed consumption data from the National Sample Survey Office (NSSO) and applying precise GST rates. The findings reveal that the bottom 50% of the population contributes only 9.6% of the total GST revenue and 28.1% of the GST contributed by Households, contrary to Oxfam's claim of 64.3%. In contrast, the top 20% contributes 41.1% of Household GST contribution and 14.2% of Total GST, reflecting the progressive nature of GST. This analysis underscores the need for accurate data and rigorous methodology in shaping public policy discourse, as misleading narratives can distort perceptions of economic fairness and influence policy decisions.

[chetak]

[Cyrano]

Thanks for posting this.
I had expressed serious reservations about using bio fuels beyond a certain % like 10-15% in another thread. As the article illustrates it has many knock on effects and can be disastrous for an economy of 1.4 billion mouths to feed like ours. The sooner Bharat ditches this net zero itch, the better.

[Najunamar]

Cyranoji, it’s not so much a net zero itch but more like hedging our bets on energy sources to enhance our strategic autonomy- already yielding rich dividends with most ME or GCC nations falling in line. Our reasons officially may be whatever suits the snake oil peddlers of the day but we’re focused on the goal of ensuring we don’t stay beholden to any cartel. This is precisely the inflection point for our economy which will show up in 2 decades (Plan for Vikshit Bharat by 2047)

[S_Madhukar]

We should be open to various green tech not for net zero but as extra energy sources. However - Not sure how long hydrocarbons will last but we must guzzle it as much as we can to get to developed status quickly. Who knows there won’t be much left in the future ! Even EU has started murmurs of shaking out of this green stupor. Top it up with a likely Uranium craze for data centres and AI and we will be having a serious crunch !

[chetak]

https://economictimes.indiatimes.com/ne ... s?from=mdr

Synopsis

India raises concerns at the WTO over China's non-transparent subsidies, trade barriers affecting pharma, shrimp, and bovine exports, and export controls on critical materials. India seeks clarity on trade practices and consistency with global norms to address the $85.07 billion trade deficit and market access restrictions.

[Cyrano]

Najunamar ji,
Agree. Bharat needs to be very hard nosed about its energy security. Just look at how quickly the mighty Germany's economy tanked with no rebound in sight as soon as cheap gas supplies from Russia were stopped, and they had killed their own Nuclear industry. That is what green wokeism does.

Bharat should keep historic to date (HTD) cumulative per capita emissions as the cornerstone of all future COP negotiations and wrestle any and all advantages it can.

[VKumar]

https://economictimes.indiatimes.com/ne ... s?from=mdr

Synopsis

India raises concerns at the WTO over China's non-transparent subsidies, trade barriers affecting pharma, shrimp, and bovine exports, and export controls on critical materials. India seeks clarity on trade practices and consistency with global norms to address the $85.07 billion trade deficit and market access restrictions.

At the very least India should ban the imports of consumer goods from China and India should promote MSME sector to produce the same. A deficit of USD 100bn is too much.

[sanjaykumar]

The Indian consumer benefits. This also is a method of outsourcing pollution to China.

[Cyrano]

What are these "bovine" exports from China that we are importing ?!!

Beef? Leather? Horns to make combs?

We have one of the largest cattle populations in the world, so this is a bit strange.

Or did DDM imply India's "bovine" exports to China? It's possible that we export buffalo meat and hides to China to eat and make faux Louis Vuitton bags by the tonne.

[sanjayc]

The Indian consumer benefits. This also is a method of outsourcing pollution to China.

We are putting 100 billion dollars every year in China's pocket. What if they spend 10% of that amount to buy weapons to deploy on India's borders. That is reminiscent of Nehru sending rice to Chinese army as they were invading Tibet and knocking on India's doors.