NIRBHARTA STARTS AT HOME
Introduction The first instalment of the Rs. 20 Trillion (Lakh Crores) package of measures announced by the finance minister on 13th May 2020 is an important major step towards keeping the economy afloat (instead of revive). Not all of the Rs. 20 Lakh Crores constitute extra fiscal expenditure. They include extra expenditures, loans, loan guarantees and […]
WHICH SECTORS DEPEND ON IMPORTS, AND WHICH DO NOT?
What sectors heavily depend on imports Electrical equipment such as smartphones and computers are a key part of India’s import bill. Around 88% of the components used by the mobile handsets industry are imported from countries like China. Over 60 per cent of the country’s medical devices are imported as well. Other products heavily imported into the country […]
PROVIDE INCOME SUPPORT, RESTORE JOBS
Why in news? States such as Madhya Pradesh, Uttar Pradesh and Gujrat have scrapped Labour laws as a move to bring about reforms to attract new investors who are looking to exit from China. Employers’ associations have urged the central government to do away with most labour rights to address temporary labour shortages. The abrogation […]
REDUCE THE COUNTRY’S PREFERENCE FOR CASH
Why in news? The first two weeks of March 2020 saw a jump of about ₹53,000 crore in cash available with the public, a spike over the fortnightly average of ₹8,435 crore over the previous 12 months. The surge continued into lockdown, in spite of apprehensions that RBI notes could act as carriers of coronavirus. […]
NOW OR NEVER: STATES ARE DRIVING BOLD REFORMS
Why in news? Uttar Pradesh, Madhya Pradesh and Gujarat have ushered in radical labour market reforms by freezing a vast number of acts and giving industries flexibility. MP has initiated a series of ease-of-doing-business process reforms: A single form for registration. Valid licences for the life of a project with no annual renewal. Shops can […]
RAGHURAM RAJAN EXPLAINS: HOW BEST TO STIMULATE ECONOMY?
Introduction To fund a bigger public spending programme, the government can either ask the RBI to print more money (monetise the deficit) or it can issue new bonds to be subscribed by the banks (raise money through borrowing). The Former RBI governor Raghuram Rajan explained how the two paths work and why ‘monetisation’ is a […]
SLOWER GROWTH AND A TIGHTER FISCAL
Introduction Various institutions have assessed India’s growth prospects for 2020-21 ranging from 0.8% (Fitch) to 4.0% (Asian Development Bank). This wide range indicates the extent of uncertainty and tentative nature of these forecasts. The International Monetary Fund (IMF) has projected India’s growth at 1.9%, China’s at 1.2%, and the global growth at (-) 3.0%. The […]
WHY LIQUOR SALES MATTER TO STATES?
Why in news? Following the easing of restrictions in the third phase of the nationwide lockdown, some of the most striking images on 4th May showed long queues outside liquor stores around the country. Manufacture and sale of liquor is one of the major sources of their revenue. How do states earn from liquor? Liquor […]
PATHWAYS TO A MORE RESILIENT ECONOMY
7 radical ideas emerging to build a more resilient economy “De-Growth”: The obsession with GDP as the supreme goal of progress has been challenged often- Goals for human progress must be reset. “Sufficient boundaries”: Boundaries impede flows of trade, finance, and people- removing boundaries is good for global growth. However, since countries are at different stages of […]
BOOST WAGES TO STIMULATE INDIA’S GROWTH
Why in news? One of the moving images from today’s India is of migrant workers suddenly feeling desolate in their places of work and desperate to return to their villages, in the aftermath of the COVID-19 outbreak. We need to plan for an economic growth driven by rising. Patchy data As per 2018 data: Out […]