Does the government has enough headspace to provide a stimulus? The simple answer to that question is, no, but perhaps it is time to forget about the fiscal deficit for a bit and address the larger issues in the economy – which will be almost impossible to without a spending spree.(Bloomberg)
Does the government has enough headspace to provide a stimulus? The simple answer to that question is, no, but perhaps it is time to forget about the fiscal deficit for a bit and address the larger issues in the economy – which will be almost impossible to without a spending spree.(Bloomberg)

Dip in GDP growth: Find ways to boost demand, and reassure the finance sector

Rural demand continues to be low, largely a function of the ongoing agrarian crisis, itself the result of a lack of market focus, poor risk management, and adverse weather conditions.
By HT Correspondent | Hindustan Times
PUBLISHED ON NOV 29, 2019 08:39 PM IST

India’s GDP grew by 4.5% in the three months ending September, the lowest since March 2013. It highlights the current economic crisis, created by factors both structural and cyclical, domestic and global. It comes after the 5% GDP growth in the June quarter. The slowdown is evident across manufacturing and agriculture.

At this stage, only three questions matter. The first is whether growth has bottomed-out. The just-ended festive season makes it difficult to use high-frequency indicators (basically data released with higher frequency than a quarter, say a month; one example is car sales) to arrive at this conclusion. But senior bureaucrats in the finance ministry believe that the third quarter will see an improvement. Since October, the government has also taken measures to address the slowdown. On the flip side, the eight core sectors contracted by 5.8% in October and late rains destroyed some crops, indicating that the third quarter may have been off to a poor start.

That brings us to the second question. Is enough being done? The finance minister, speaking in Parliament earlier this week, mentioned 32 measures the government has launched to spur growth. It has cut corporate taxes, announced a real estate fund, embarked on an ambitious divestment exercise, and also merged banks. But it needs to do more. The finance sector faces a crisis of confidence, and there are fears that the problems witnessed in a few shadow banks could hurt the entire financial sector, spilling over into mutual funds and banks. Rural demand continues to be low, largely a function of the ongoing agrarian crisis, itself the result of a lack of market focus, poor risk management, and adverse weather conditions.

The obvious third question is whether the government has enough headspace to provide a stimulus. The simple answer is no. But, perhaps, it is time to forget about the fiscal deficit for a bit and address the larger issues in the economy —which will be almost impossible to do without a spending spree. To be sure, the Reserve Bank of India can be counted on to recognise the spike in inflation in October as a result of a temporary shortage of vegetables and cut the policy rate, like it has done through the year. But the government needs to continue to find ways to boost aggregate demand, even as it does enough to reassure the finance sector. A bad-loans bank, a cut in income tax rates, a rural package — everything should be evaluated.

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A range of fundamental rights enable citizens to move freely, work anywhere in the country, and be entitled to be treated with equality and without discrimination. (ANI)
A range of fundamental rights enable citizens to move freely, work anywhere in the country, and be entitled to be treated with equality and without discrimination. (ANI)

The dangers of populism

By HT Editorial
UPDATED ON MAR 04, 2021 02:13 PM IST
Constitutionally suspect and economically unwise, reservation for locals evades the real crisis. Like the rest of India’s political class, Haryana’s leaders are evading the real crisis of jobs to offer prescriptions which may only make the problem worse.
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The party establishment has co-opted a set of G23 leaders. At the same time, the Congress leadership should recognise that its real challenge is not the dissenters, but the party’s failure to win the confidence of citizens in elections. (HTPHOTO)
The party establishment has co-opted a set of G23 leaders. At the same time, the Congress leadership should recognise that its real challenge is not the dissenters, but the party’s failure to win the confidence of citizens in elections. (HTPHOTO)

The challenge within the Congress

By HT Editorial
PUBLISHED ON MAR 03, 2021 07:06 PM IST
If this rift in the Congress leads to a stronger opposition, it is good for democracy. But the challenge for the challengers is that they seem to lack the mass base outside the party and internal strength within the party to force a change in leadership.
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The SC bench would do well to rethink its approach and ensure that all such future cases are dealt with strictly within the letter and spirit of the law (File Photo)
The SC bench would do well to rethink its approach and ensure that all such future cases are dealt with strictly within the letter and spirit of the law (File Photo)

Women’s right to autonomy, justice | HT Editorial

By HT Editorial
UPDATED ON MAR 03, 2021 04:13 PM IST
There must be a greater effort at gender sensitisation across all levels of the judiciary to prevent such attempts to grant amnesty for violent crimes against women
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Brigade rally called by Left Front, Indian National Congress and Indian Secular Front (ISF) ahead of West Bengal Assembly Election in Kolkata. (Samir Jana/HT Photo)
Brigade rally called by Left Front, Indian National Congress and Indian Secular Front (ISF) ahead of West Bengal Assembly Election in Kolkata. (Samir Jana/HT Photo)

Discrediting secularism | HT Editorial

By HT Editorial
PUBLISHED ON MAR 02, 2021 06:55 PM IST
The Left and the Congress must carefully introspect about their political choices, for allying with extreme identity-based groups on one side will not help in their aim of defeating an identity-based formation on the other side
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According to the Harvard Kennedy School’s Belfer Centre, as of 2020, China ranks only second to the US in having the skills to pursue cyber objectives. But where it lacks skill, it makes up for intent — earning an overall cyber power index rank of two among 30 countries. India, with low intent as well as capability, ranks 21 (Getty Images/iStockphoto)
According to the Harvard Kennedy School’s Belfer Centre, as of 2020, China ranks only second to the US in having the skills to pursue cyber objectives. But where it lacks skill, it makes up for intent — earning an overall cyber power index rank of two among 30 countries. India, with low intent as well as capability, ranks 21 (Getty Images/iStockphoto)

Boosting cyber capabilities

By HT Editorial
PUBLISHED ON MAR 01, 2021 06:08 PM IST
A report indicating a Chinese attack on critical Indian infrastructure should lead to a review. Cyber experts have long pointed out this asymmetry in capabilities between India and its adversaries and how engagement in the cyber domain is not limited to rules of real-world conflict.
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To kickstart this green housing revolution, states must adopt the Eco-Niwas Samhita Part I, an energy conservation building code for residential buildings, which was launched by the Bureau of Energy Efficiency in 2018. This sets standards to limit heat gains (for cooling-dominated climates), limit heat loss (for heating-dominated climates), and ensure natural ventilation and daylight potential. Unfortunately, the codes are voluntary, and many states have not dovetailed them into their by-laws. (Bloomberg)
To kickstart this green housing revolution, states must adopt the Eco-Niwas Samhita Part I, an energy conservation building code for residential buildings, which was launched by the Bureau of Energy Efficiency in 2018. This sets standards to limit heat gains (for cooling-dominated climates), limit heat loss (for heating-dominated climates), and ensure natural ventilation and daylight potential. Unfortunately, the codes are voluntary, and many states have not dovetailed them into their by-laws. (Bloomberg)

Housing must be climate-resilient

By HT Editorial
PUBLISHED ON MAR 01, 2021 06:01 PM IST
Delhi recorded its second warmest February since 1901. To adapt to a warming world, India needs to construct buildings that are thermally comfortable; have natural daylight; and proper ventilation.
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On the basis of this, Friday’s data, anecdotal evidence, and high-frequency indicators, while it does seem likely that India’s recovery will be patchy, the overall number for 2020-21 may actually end up being a little better than -8%, or even -7.7% (PTI)
On the basis of this, Friday’s data, anecdotal evidence, and high-frequency indicators, while it does seem likely that India’s recovery will be patchy, the overall number for 2020-21 may actually end up being a little better than -8%, or even -7.7% (PTI)

Reading the numbers right | HT Editorial

By HT Editorial
UPDATED ON MAR 01, 2021 06:20 AM IST
India’s third quarter Gross Domestic Product (GDP) numbers, released on Friday, are interesting for a variety of reasons, not the least being the fact that while the GDP number was marginally lower than estimates, the gross value added (GVA) number was marginally higher
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The expansion of the drive, and the involvement of the private sector is a welcome move, and will help, but it is time India started thinking about opening up vaccination for all takers (Sant Arora /Hindustan Times)
The expansion of the drive, and the involvement of the private sector is a welcome move, and will help, but it is time India started thinking about opening up vaccination for all takers (Sant Arora /Hindustan Times)

Covid-19: Open up vaccination for all | HT Editorial

By HT Editorial
UPDATED ON MAR 01, 2021 06:20 AM IST
As this newspaper has repeatedly said: Approve more vaccines; make them available in the open market; and open up vaccination
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It is not unknown for even this Indian government, which has taken one of the strongest positions on Pakistan in recent decades, to engage in secret talks with the Pakistani side (ANI)
It is not unknown for even this Indian government, which has taken one of the strongest positions on Pakistan in recent decades, to engage in secret talks with the Pakistani side (ANI)

The India-Pakistan thaw | HT Editorial

By HT Editorial
UPDATED ON FEB 27, 2021 06:25 AM IST
The sudden announcement of the Indian and Pakistani armies recommitting themselves to the frayed 2003 ceasefire agreement on the Line of Control (LoC) in Jammu and Kashmir (J&K) took many by surprise in New Delhi and Islamabad, especially as it came at a time when both countries have shown no signs of being able to agree on anything
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ndian governments, irrespective of their hue, have had a troubled relationship with privatisation. Much of this, on the basis of the history of privatisation, appeared to stem from a lack of belief in it. Which is why Prime Minister (PM) Narendra Modi’s repeated emphasis on privatisation — a handful of times in speeches in the past few weeks — is both important and welcome. (PTI)
ndian governments, irrespective of their hue, have had a troubled relationship with privatisation. Much of this, on the basis of the history of privatisation, appeared to stem from a lack of belief in it. Which is why Prime Minister (PM) Narendra Modi’s repeated emphasis on privatisation — a handful of times in speeches in the past few weeks — is both important and welcome. (PTI)

The benefits of privatisation

By HT Editorial
UPDATED ON FEB 26, 2021 06:32 AM IST
It can help the State to reassign funds, monetise its assets, and improve the competitiveness of firms
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India’s benchmark inflation rate, as measured by the Consumer Price Index (CPI), stayed above the upper limit of the Reserve Bank of India’s tolerance zone continuously between April and November 2020. This inflationary phase was driven by a spike in food prices, and it has ended with a collapse of the same from December. (MINTPHOTO)
India’s benchmark inflation rate, as measured by the Consumer Price Index (CPI), stayed above the upper limit of the Reserve Bank of India’s tolerance zone continuously between April and November 2020. This inflationary phase was driven by a spike in food prices, and it has ended with a collapse of the same from December. (MINTPHOTO)

Keep an eye on global commodity inflation

By HT Editorial
UPDATED ON FEB 26, 2021 06:33 AM IST
Recent movement in global commodity prices suggests that we could be heading for a long-term rally after a benign run, followed by a collapse during the pandemic.
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As alarm grows over what appears to be the beginning of India’s second Covid-19 wave, the Union government on Wednesday lifted some key restrictions to speed up vaccination and expand the parameters of who is eligible for inoculation (Pratik Chorge/HT Photo)
As alarm grows over what appears to be the beginning of India’s second Covid-19 wave, the Union government on Wednesday lifted some key restrictions to speed up vaccination and expand the parameters of who is eligible for inoculation (Pratik Chorge/HT Photo)

A welcome step on vaccination | HT Editorial

By HT Editorial
PUBLISHED ON FEB 24, 2021 09:10 PM IST
t is important that India leverages its relative success against Covid-19 to equip its citizens in the face of a race against time against a possible second wave. Wednesday’s decision by the Union Cabinet marks a step in the right direction
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The critics may be wrong, they may make exaggerated claims, their activism may cause challenges in policy execution, but they enrich democratic discourse (REUTERS)
The critics may be wrong, they may make exaggerated claims, their activism may cause challenges in policy execution, but they enrich democratic discourse (REUTERS)

In defence of personal liberty | HT Editorial

By HT Editorial
PUBLISHED ON FEB 24, 2021 09:10 PM IST
Beyond the particulars of this case, the Delhi sessions court judgment is welcome. It did well in standing up for citizen rights
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There are indications that progress at the border will result in a gradual, perhaps even linked, resumption of the economic relationship. But both military and economic imperatives dictate that there shouldn’t be return to the economic status quo — and the future economic relationship must be more equal. (AP)
There are indications that progress at the border will result in a gradual, perhaps even linked, resumption of the economic relationship. But both military and economic imperatives dictate that there shouldn’t be return to the economic status quo — and the future economic relationship must be more equal. (AP)

On China, the trade dilemma

By HT Editorial
UPDATED ON FEB 24, 2021 06:12 AM IST
One key reason the US has struggled to deal with an aggressive China is precisely its economic web of interdependence with China. India must continue to do business with China, but on better terms, without compromising its interests.
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The nature of the cyberspace is such that if attackers are able to leverage all or a combination of these weaknesses, they can cause damage that will be far greater than the sum of the parts (Getty Images/iStockphoto)
The nature of the cyberspace is such that if attackers are able to leverage all or a combination of these weaknesses, they can cause damage that will be far greater than the sum of the parts (Getty Images/iStockphoto)

Secure India’s digital infrastructure

By HT Editorial
UPDATED ON FEB 24, 2021 06:12 AM IST
These incidents bring into focus problems that independent researchers have flagged for long — inadequate recognition of threats, a digital infra erected without adequate safeguards, endemic lack of awareness of safe practices, and a threat and vulnerability response mechanism that is far from dynamic.
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