The crux of RBI’s assessment is that while the worst is over, the economy is not out of the woods yet(REUTERS)
The crux of RBI’s assessment is that while the worst is over, the economy is not out of the woods yet(REUTERS)

The economy is still fragile | HT Editorial

Financial sector stability and low demand remain key challenges
By HT Correspondent | Hindustan Times
PUBLISHED ON OCT 12, 2020 06:22 AM IST

The Reserve Bank of India (RBI)’s Monetary Policy Committee (MPC), in its first forecast after the Covid-19 pandemic, has projected a 9.5% contraction for the Indian economy in the current fiscal year. This number is in line with other projections and should settle the debate about the impact of the pandemic on the economy, for it is now clear that the Indian economy is going to face its worst-ever contraction. RBI governor Shaktikanta Das also ruled out any V-shaped recovery — which reflects an immediate revival in growth — and indicated that different sectors will follow different revival trajectories and the overall performance will be a sum of these parts. He also acknowledged the possibility of a second wave of the pandemic derailing the ongoing gradual revival from the 23.9% contractionary shock in the first quarter of the current fiscal year.

The crux of RBI’s assessment is that while the worst is over, the economy is not out of the woods yet. Policy intervention, going forward, needs to have two objectives. It should ensure that things do not get worse. This will require controlling the pandemic (there is little RBI can do in this regard) and mitigating the impact of the pandemic’s current and future economic shocks on important economic institutions. The ongoing Supreme Court case where RBI is arguing against a stay on classifying loan defaults as non-performing assets is a critical factor vis-à-vis financial sector stability. Another factor, which has been highlighted by economist Pranjul Bhandari, is the risk of India facing another taper tantrum-like situation in the near future as advanced economies raise interest rates and inflation proves to be more than a transitory phase in India. A capital flight triggered by the coming together of these two factors could give a jolt to the stock market, which crossed the psychological 40,000-mark once again last week.

To be sure, the government has undertaken critical reforms in sectors such as agriculture and labour during this period. This newspaper believes that they have the potential to unleash long-term gains. Any such gains, however, can be jeopardised if India’s financial sector problems, especially growing bad debt in banks is not addressed. If there is one lesson from India’s experience after the 2008 economic crisis and its aftermath, it is that a credit boost to unviable businesses cannot lead to a sustainable growth revival. This is also why the question of boosting demand continues to be critical.

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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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Puducherry Chief Minister V Narayanasamy hands over his resignation letter to Lt Governor Dr Tamilisai Soundararajan after he failed to prove his majority in the assembly, in Puducherry, Feb. 22. (PTI)
Puducherry Chief Minister V Narayanasamy hands over his resignation letter to Lt Governor Dr Tamilisai Soundararajan after he failed to prove his majority in the assembly, in Puducherry, Feb. 22. (PTI)

In Puducherry, a political crisis | HT Editorial

By HT Editorial
PUBLISHED ON FEB 22, 2021 08:39 PM IST
In Puducherry, on Monday, the Congress government, led by chief minister V Narayanasamy, lost power
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Last year, the Capital saw its most horrific violence after 36 years (AFP)
Last year, the Capital saw its most horrific violence after 36 years (AFP)

A year on, Delhi riot victims await justice | HT Editorial

By HT Editorial
PUBLISHED ON FEB 22, 2021 08:39 PM IST
There has to be an independent examination of what happened last February and the law will have to take its course without considering political affiliations and victims will have to be provided justice
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The migrant crisis, triggered by the lockdown imposed to curb the spread of the pandemic, saw, according to official figures, over 10 million migrant workers returning home. (SANTOSH KUMAR/HTPHOTO)
The migrant crisis, triggered by the lockdown imposed to curb the spread of the pandemic, saw, according to official figures, over 10 million migrant workers returning home. (SANTOSH KUMAR/HTPHOTO)

Providing migrant workers a political voice

By HT Editorial
PUBLISHED ON FEB 21, 2021 06:56 PM IST
The economy has been opening up and many migrant workers have started going back to their jobs, but this issue must not be relegated to the margins. It’s time migrant workers get the respect, protection and rights they are entitled to as citizens.
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Democracies must work together to hold big tech firms accountable and preserve the basic building blocks of open, informed societies. India must follow suit. (Getty Images)
Democracies must work together to hold big tech firms accountable and preserve the basic building blocks of open, informed societies. India must follow suit. (Getty Images)

Australia is on the right path

By HT Editorial
UPDATED ON FEB 22, 2021 06:34 AM IST
Australia’s decision to take on big tech firms and adopt a principled stand on the issue is welcome. And so is Australian Prime Minister Scott Morrison’s call to Prime Minister Narendra Modi — where, according to the Australian readout, Mr Morrison spoke of the progress in the media-related legislation
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