Saturday, February 29, 2020

Will a virus prevent a world war?

"The US and the Taliban have signed an 'agreement for bringing peace' to Afghanistan after more than 18 years of conflict. The US and Nato allies have agreed to withdraw all troops within 14 months if the militants uphold the deal." "Under the agreement, the militants also agreed not to allow Al Qaeda or any other extremist group to operate in the areas they control." "I do believe the Taliban wants to do something to show we're not all wasting time," said US President Donald Trump. It may not be a clear victory for the Taliban but it is certainly a defeat for the US belief that it could defeat the Taliban militarily. The US had to negotiate directly with the Taliban who refused to talk to the elected Afghan government, which it sees as a puppet regime. While not a direct puppet of Pakistan, the Taliban is supported, sheltered and armed by the Pakistani army. Pakistan wants a pliable government in Afghanistan which would give it control over trade routes to central Asian countries and the entire border with Iran. Controlled peace in Afghanistan will allow Pakistan to devote all its resources to supporting terrorism in Kashmir, where Pakistan wants to slowly destroy India by a "thousand cuts". On 14 November 2019, Pakistan Prime Minister said his country will not fight wars for others. But, at least it got paid for those wars, but fighting its own wars have been disastrous, wrote Khaled Ahmed. However, just as there is a glimmer of hope of for peace in Afghanistan, there could be a huge war brewing in the Middle East where Turkey has invaded Northern Syria partly to divert attention of its citizens from the economy and partly to wipe out Kurds who are hated by Turkish President Recep Tayyip Erdogan. While Erdogan supported ISIS, the Kurds were the main fighters on the ground while the US provided air support. When the ISIS was defeated the US betrayed the Kurds by withdrawing its troops and leaving them at the mercy of Erdogan. Encouraged by the craven flight of the US, Erdogan has vowed to fight the Syrian Army's advance into Idlib province. Bombing by Syrian planes killed 33 Turkish soldiers in Idlib. Turkey blamed Russia for the bombing and as a member of Nato wanted to activate Article 5 which compels Nato partners to defend it with their armed forces. In 2015, Erdogan tried to instigate war between Nato and Russia by shooting down a Russian SU-24 for apparently entering Turkish airspace for 17 seconds. Erdogan had to eat humble pie before President Putin agreed to lift economic sanctions against Turkey. In an effort to force Europe to support his designs Erdogan has opened his borders, allowing thousands of refugees to travel to Europe. Will the US surrender to Erdogan, like it has surrendered to Pakistan? Maybe the Coronavirus will prevent war by stopping movement of soldiers. A deadly virus as savior?

Friday, February 28, 2020

What will they tax if earnings keep falling?

When demonetization was suddenly inflicted on the nation by Prime Minister Narendra Modi, on 8 November 2016, "Several sectors that transact in cash were left holding large sums when Rs 1,000 and Rs 500 were rendered invalid in November 2016. Several companies deposited the cash they were holding in bank accounts." In an act of largesse this year's budget increased income tax threshold limit to Rs 500,000 and reduced the rate of taxation by increasing the number of slabs of income, provided the assessee gives up all exemptions allowed until now. "India's slowdown has bottomed out; economy needs to be opened up if the country wants to realise the ambition of a 10% growth rate, former Niti Aayog Vice Chairman Arvind Pahagariya has said." Three stories which appear to be disparate but actually have one theme in common. And that is the desperation of this government to squeeze an unjustified amount of tax out of individuals and businesses. Workers in the unorganized sector prefer to be paid in cash so these businesses tend to keep large amounts of cash. Those with illicit cash transferred it to northeast states which are exempt from income tax. Economic growth was lowered by 2% by demonetization found a paper from US-based National Bureau of Economic Research, but the effect dissipated by the next quarter. Demonetization was a "massive, draconian monetary shock", wrote former Chief Economic Adviser Arvind Subramanian which hit the unorganized sector badly and failed to achieve any of its objectives. Unfortunately the government is not willing to accept it. As for easing the burden on taxpayers, under the new scheme a person earning Rs 500,001 will end up with much less money than one earning exactly Rs 500,000. It is a trap for the gullible. This year's budget increased customs duty on many imported goods. "Consumers can expect to pay more for imported food and grocery items, shoes, ceiling fans, wooden furniture, kitchenware, appliances, hairdryers, shelled walnuts and other items with the budget raising basic customs duty to as much as 100% on some of them to encourage local producers." Raising prices of imported allows domestic producers to charge higher prices from customers which means the government can earn more from goods and services tax (GST) levied on those items. Tax officials have suddenly raked up claims on jewelers who sold their stock at massive gains following demonetization. Companies are taking legal action against tax officials for denying them GST relief on gifts given to customers. No wonder GDP growth was a meager 4.7% in the third quarter ending 31 December. Investment needs money and the government thinks anyone with money must be a thief. Better to be safe and earn little.

Thursday, February 27, 2020

Is the RBI trying to increase growth by increasing bad loans?

"A sharp pickup in India's business activity in January signaled momentum returning to Asia's third-largest economy, although a strong recovery looks unlikely as consumer demand remains subdued," wrote Anirban Nag. "The Markit India Services PMI index climbed to 55.5 in January -- the highest in seven years -- from 53.3 in December." "The IHS Markit Manufacturing Purchasing Managers' Index (PMI) jumped to 55.3 in January from 52.7 in December." "The country has entered a major economic slowdown. The growth number probably understates the magnitude of the slump," wrote Noah Smith. The Reserve Bank (RBI) cut interest rate 5 times last year, to 5.15%, so that real interest rate is at minus 2.44% as retail inflation jumped to 7.59% in January. The RBI should buy up loans of banks and shadow banks, so that they can resume lending, and the government should invest in infrastructure of cities to increase urbanisation, which will reduce poverty by allowing the rural poor to move to cities to earn more. Trouble is, that the RBI is predicting that bad loans at commercial banks will rise to 9.9% in September 2020 from 9.3% in September 2019, wrote Gopika Gopakumar. In October, the Supreme Court ordered telecom companies to pay the government a total of Rs 1.3 trillion in unpaid licence fees, penalties and taxes. Top Indian banks have an exposure of Rs 1.5 trillion  to telecom companies and if one of them defaults it will add to bad loans. Naturally, telecom company Vodafone Idea wants to increase charges to customers by 7-8 times to be able to pay the government. An alarmed RBI is concerned about increasing bad loans at banks if the company defaults, if prices are not raised, and of increasing retail inflation if prices jump. Farm loans waivers by politicians, to win elections, will add Rs 607.62 billion to bad loans at State-run banks. Former governor of the RBI Raghuram Rajan instituted an asset quality review (AQR) which revealed a jump in bad loans at banks from 4.62% in 2014-15 to 10.41% by December 2017. The present governor Shaktikanta Das has allowed banks to conceal bad loans of the micro, small and medium enterprises (MSMEs) and real estate sectors. A survey by the RBI showed that consumer sentiment is at a five-year low leading to low capacity utilization at manufacturing firms. Capacity utilization needs to be above 80% before companies will invest in new projects. Capacity utilization is presently at 69% so the RBI is trying to facilitate consumer lending in an effort to increase demand, wrote Prof Deep Narayan. Household savings are at a 15-year low so people are borrowing to finance consumption. If the economy does not pick up households could also default on their loans. That is when the stink will hit the fan.

Wednesday, February 26, 2020

Can a wall hide fire and dead bodies?

"On Tuesday, New Delhi presented a tale of two cities. One set of images broadcast to the world showed US President Donald Trump with Indian Prime Minister Narendra Modi -- a glitzy meeting of the world's two largest democracies. Another set of images, getting less attention, showed Hindu mobs attacking people who were protesting the controversial new citizenship law," wrote Ravi Agrawal. A 'Namaste Trump' event was organised at the Motera Stadium in Ahmedabad, where, "Namaste Trump caps were distributed across the stadium which erupted in a cheer when US President Donald J Trump and first lady Melania Trump walked in. They were welcomed at the dais by Indian Prime Minister Narendra Modi who has pulled out all stops to make this jamboree a show stopper," wrote Utpal Bhaskar. This was payback for the 'Howdy Modi' event organised by people of Indian origin (PIOs) living in the US, which was attended by Trump. Indian dancers lined the route from the airport to the stadium, but, "Many of those watching the telecast of the show on television cringed at the poorly organized cultural showcasing of India. The dancers looked gawky and untrained," wrote Shuchi Bansal. It looked more like brand "India Tourism" than 'Brand India", said brand consultant Harish Bijoor. "While 'Incredible India' is associated with tourism, Brand India should be 'credible India'." "India hastily erected a 7-ft wall so that Trump wouldn't have to see a slum on his way to a rally."  While all the glad-handing and dancing were going on riots had broken out in northeast Delhi. "Photographs, videos and accounts on social media paint a chilling image of the last few days -- of mostly Hindu mobs beating unarmed men, including journalists; of groups of men with sticks, iron rods and stones wandering the streets; and of Hindus and Muslims facing off." "Prime Minister Narendra Modi tweeted on Wednesday, three days after the violence broke out, appealing for peace." The US embassy advised US citizens to be careful. "US citizens in India should exercise caution in light of violent demonstrations in Northeast Delhi and avoid all areas with demonstrations ," the embassy advisory said. "The death toll in the northeast Delhi communal violence over amended citizenship law rose to 34 on Thursday morning." At least nine died of gunshot wounds. The riots were a result of a speech by a member of the BJP Kapil Mishra, wrote the New York Times. "In a Hindu majority nation, with a Hindu nationalist government that has allowed the killers of Muslims to go unpunished, fear has been growing that violent Hindu extremism could spin out of control." The New York Times is biased and publishes anti-Indian propaganda disguised as news, wrote Prof Ramesh Thakur. Apparently, "Preparation for genocide is definitely underway in India ... the next stage is extermination -- that's what we call genocide," said Prof Gregory Stanton. This is the kind of rubbish that provokes Hindu reaction who see this as religious extremism against Hindus. The violence should have been stopped instantly. Trump may have been pleased at his reception, India definitely lost out. Imbeciles.   

Tuesday, February 25, 2020

Shouldn't he be concentrating on serving the nation?

"The data shows that out of a total of 57.8 million individual tax filers, only 14.6 million were liable to pay taxes, while just 460,000 people declared an income of above Rs 10 lakh," wrote Vivek Singh, who is additional private secretary to the finance minister, which means he could be a member of the exclusive club of overpaid, predatory and often corrupt Indian Administrative Service (IAS), which is a continuation of the Indian Civil Service of the British, and perhaps more tyrannical. The other author is Karan Bhasin, who describes himself as an independent economist. Independent from whom is not clear. "Further, only 2,200 professionals, such as chartered accountants, doctors and lawyers, disclosed an income above Rs 1 crore (Rs 10 million), which is surprising." Why is that causing heartburn to Singh? Because, "The possibility of a discrepancy is rare for salaried employees, thanks to the easy availability of formal records. It would thus be fair to assume that tax avoidance takes place mostly in the informal sector, and among high-income service providers." So, Singh's grouse is that he is having to pay tax while doctors maybe getting away with undisclosed income. Most highly paid doctors work in private hospitals where they receive salaries, which means their tax is deducted at source, just like Singh's. Very few would earn over Rs 10 million and for that kind of money they work all day and most nights, when Singh would be fast asleep. As for not paying taxes, here is what an ex-IAS officer has to say about his experience during 10 years of service. With his enormous sense of entitlement Singh does not realise that doctors in the private sector in India get nothing for the enormous taxes they pay during their entire working lives -- no pension, no healthcare and no old age care, whereas the perks of an IAS officer would probably make a US official drool. Not only do they get eye-watering pensions, their families continue to receive pensions even if the officer has died after a short service. On top of that, they force themselves into exclusive clubs and if they are denied life membership they use their powers of extortion to crush anyone daring to challenge their untrammelled authority, as Bombay Gymkhana found to its cost. They get healthcare for life under the CGHS scheme, including in private hospitals. And what do doctors get for treating these highly paid pen pushers? They get a lousy Rs 150 for a consultation and Rs 300 for an indoor patient. While doctors have to answer to courts for any perceived mistake, IAS officers are completely unaccountable. An IAS officer would cost in excess of Rs 1 billion during his lifetime. On our taxes.  

Monday, February 24, 2020

If a bust is inevitable, let's enjoy the boom.

"There are times when we should expect the system to reach a tipping point -- the 'Minsky Moment' -- when a boom and a bubble turn into a crash and a bust," wrote Prof Nouriel Roubini, known as "Dr Doom" for having predicted the subprime crash of 2008. "It's a scary time for the global economy," he said last year. Prof VA Nageswaran confessed that he has been like a broken clock in predicting a collapse of the stock market bubble. A broken clock shows the correct time twice in every 24 hours but he is not sure when (or if) his prediction for the stock market will prove correct. Using data for the last 200 hundred years, Aaron Closet used mathematics to predict that a major war is likely in the last 100 years and a billion people could be killed in a nuclear war in the next 1,300 years. Many things can happen in 100 years and in 1,300 years humans could be thriving on other planets. "A majority of millennials around the world believe it's more likely than not that a nuclear attack will happen sometime in the next 10 years," wrote Alex Ward. But this could be because of economic insecurity or social media pressures. There could be war between Iran and the US, there could be a pandemic of coronavirus, cyberwarfare could  escalate and climate change is accelerating, thinks Roubini. Gold prices have risen 30% as China and Russia stockpile gold, moving away from US Treasuries. "Last year was the first year in 120 years when the GDP of countries that are democracies was less than the GDP of autocracies," said former UK Foreign Secretary David Milliband. It could be because of support for terrorists in Syria, which has prolonged the suffering of Syrian people and resulted in a wave of refugees, or the unnecessary sanctions on Russia, based on fake allegations, or the racist breakup of trade alliance between democratic countries. "Pakistanis get radicalised after migrating to the UK," wrote Khaled Ahmed. "It appears that religious radicalism didn't go from Pakistan to the UK, but actually came to Pakistan from London. Al-Muhajiroun had come to Pakistan along with its British-based sister terrorist organisation, Hizb ut-Tahrir, in the mid 2000s, and recruited a number of people inside the Pakistan army till the Musharraf government banned them." Facing criticism at home for its handling of the Coronavirus the Chinese government has blamed other countries for isolating it, wrote Nayan Chanda. "China has publicly chastised countries like New Zealand for 'joining efforts to isolate the Chinese economy' under the guise of fighting to spread the virus." When democratic countries are disunited and disorganised a crisis should not be a surprise. Hopefully it will hurt baddies more than the goodies.

Sunday, February 23, 2020

How can any gig worker earn over Rs 4 million?

A recent study over a 13 year period by Laveesh Bhandari and Amaresh Dubey found that "non-contractual employment grew by 68 million over the period", wrote Nitin Pai. "There were 145 million people in non-contractual employment in 2017-18", so that "Indians constitute a quarter of the world's gig workers, earning $1 billion last year and registering double digit growth". Ominously, "Recent reports suggest that revenue officials are leaning on platforms and aggregators to get gig workers registered with the goods and services tax (GST) network." Why? According to the GST law, only those whose income exceed Rs 4 million per year need to register for GST. Do officials think that those who deliver food for online companies earn over Rs 330,000 per month? Even if drivers working for Uber earn Rs 4,000 per day, their earnings are not enough to register for GST and they would be paying large sums to banks to repay their loans and will get nothing if they are off sick. The GST system is so complicated that none of these people can have a clue on how to file their returns and would have to pay accountants over half of what they earn. If they don't or if there are mistakes in filing returns they will face enormous penalties. A poor 'kachor wala' (one who sells fried snacks) in Aligarh was raided by officials for not registering for GST. The alleged millionaire kachori wala turned out to be extremely poor, living in a 225 sq ft shack, with few material possessions. Money raised by GST is supposed to be shared equally between the Center and the states because sales tax, octroi and other taxes imposed by states to raise revenue were subsumed under GST. "Shortfalls were to be met via the 'compensation cess', which is an additional tax levied on five 'sin' products: sports utility vehicles, tobacco, aerated water, coal and cigarettes." There is a limit on how high taxes can go because as prices rise the number of users starts to decline, resulting in tax collection remaining static or even declining. "The Central government has defaulted on the bi-monthly compensation payment, due in October, without any notice or explanation. Now in December-end yet another bi-monthly instalment is due which would make unpaid compensation to the States Rs 35,000 crores," wrote TM Thomas Isaac.  "Numerous studies have shown that state expenditure, especially capital expenditure, is a major contributor to gross domestic product (GDP) growth," wrote Rajrishi Singhal. Not just GST compensation, the Center is not paying the states for its own subsidy schemes. ""The funds released for Jal Jeevan Mission were at 51%. PM Kisan at 57%, Ayushman Bharat at 32%, and the Poshan Abhiyan at 31% of total allocations by November/December 2019," wrote  Yamini Aiyer. Trying to extract taxes out of gig workers will kill gig work and destroy online retail. After all you can't squeeze blood out of stone

Saturday, February 22, 2020

Who'll want to miss selfies with God?

Since the United States is paradise for most Indians, President Donald Trump has to be God. Trump is to oblige us by visiting India tomorrow and the day after. Apart from his wife Melania, Trump will be accompanied by his advisers, including daughter Ivanka and son-in-law Jared Kushner. Every US president has visited India since Bill Clinton but before that many did not consider India important enough. After all, India had to beg the US for wheat supplies under PL 480 to stave off a disastrous famine. Indira Gandhi was kept waiting for 45 minutes at the White House by Richard Nixon who described her as a "bitch" and a "witch", advised by his Secretary of State, the genocidal monster Henry Kissinger. Since then India has maintained large stocks of food grains by protecting farmers from low prices through the Minimum Support Price scheme on 22 different crops. Ironically, the US has complained to the WTO about, what it sees as, farm subsidies in India. According to the International Monetary Fund (IMF), India was the fifth largest economy in the world in 2019, with nominal GDP of $2.9 trillion, behind the US, China, Japan and Germany but above the UK, France and Italy. Sadly, that is the good news. India's per capita GDP is at 139 in the world at $2,171 per year and "78% of India's adult population has wealth below $10,000". Only 1.8% of the population, about 20 million people, has wealth more than $100,000. Not a large market at all. According to World Bank classification, countries with per capita income from $1,026 to $3,995 are lower middle income countries. "India's per capita income in 2018 was $2,020, at the halfway point for lower middle income category," which means that "For now India is in the Nigeria zone," wrote Salman A Soz. Trump "will raise the issue of religious freedom in his public remarks" and also "in his private meeting with Prime Minister Narendra Modi, US officials have said", wrote Seema Sirohi. On what grounds? "The grounds on which the government has invoked the draconian Public Safety Act against former chief ministers (of Kashmir) Omar Abdullah and Mehbooba Mufti read like a fake WhatsApp forward," said an editorial in The Indian Express. Mufti was accused of being "daddy's girl" and the medieval queen Kota Rani. Police in Mumbai are stopping people from carrying musical instruments, especially the dafli, used by street musicians. US officials also "criticised the recent budget for raising tariffs that affect US products". Customs duties were increased in the 2018 budget and a further 37 items saw increased tariffs in this year's budget. Apart from glad handing and rented crowds nothing much will come form this visit, wrote Mihir Sharma for Bloomberg. At least there will be selfies with God.

Friday, February 21, 2020

Can't grow if you keep uprooting them.

"Finance Minister Nirmala Sitharaman said on Tuesday that several important indicators have emerged in the recent past pointing towards green shoots in the economy." She said "the size of the Indian economy increased from two trillion dollars in 2014-15 to 2.9 trillion dollars in 2019-20". Since the economy is expressed in dollars the size of the economy depends on the strength of the rupee against the dollar. Unfortunately, "Moody's slashed growth forecast for Indian economy to 5.4 percent from 6.6 percent for 2020 -- a difference of over one percentage point. The updated GDP growth estimate for 2021 is 5.8 percent, down from 6.7 percent". "The Economic Survey estimated that Indian economy would grow by 6-6.5 percent in 202-21." "Given that at present India is a $2.7 trillion economy (in 2010 constant dollar terms)" it will take 4-5 years to grow to $5 trillion even if growth accelerates " to 14-15% per year in real terms", wrote Prof Parag Waknis. Mark Aguiar and Gita Gopinath argued "that emerging economies experience frequent policy regime switches, leading to substantial volatility in trend growth", whereas in developed economies, "There is a fair degree of stability in the policy environment that businesses and individuals face, making it easier for them to form expectations and take decisions." "Prime Minister Narendra Modi's vision of making India $5 trillion economy and a global economic powerhouse by 2024-25 is 'challenging' but 'realisable'," Sitharaman said in New York in October. To achieve that, the government has been spending heavily to stimulate economic activity and increase consumer demand. "India's problem is not insufficient budget stimulus. Rather, budgets have provided huge stimulus (cloaked by budgetary fictions) for three years in a row, and yet GDP growth has kept slowing," wrote SA Aiyer. High spending was financed by increased borrowing so that fiscal deficit is "perhaps 7.5-8% of GDP, making India a world champion in fiscal profligacy". To plug the hole in its budget the government adopts increasingly strong-arm methods of extracting taxes from businesses and individuals, wrote Suman Layak. A slowing economy and the government's greed for taxes is decimating small industries. Factory owners are compelled to pay Goods and Services Tax (GST) in full as soon as they bill their customers but they get paid after at least 90 days. As a result they have to borrow to pay GST. Indian households are financing their spending by reducing savings which means banks have less money to lend. Companies are taking legal action over not getting relief on GST for expenses incurred in giving gifts to customers. A waste of time and money and delay in investment until the matter is resolved. No wonder, green shoots are very hard to find, wrote Vivek Kaul. Green shoots don't just grow, they need nurturing. The government keeps uprooting them.   

Thursday, February 20, 2020

Why do they refuse to learn?

"Economists of all hues now agree that structural reforms are necessary to revive the Indian economy," wrote Arun Maira. Like what Mahatma Gandhi wanted. "Gandhi envisaged a model in which producers would be owners of their tiny enterprises." "He wanted constructive workers to create wealth for themselves, and not be mere wage earners enriching remote owners." Prime Minister Narendra Modi agrees with Maira and famously advised young people to sell "pakodas' (deep fried vegetables coated in batter), which was supported by Home Minister Amit Shah in parliament. The Periodic Labor Force Survey (PLFS) of 2017-18 found, "As much as 70% of the self-employed were own account workers, an official categorization of self-employed workers who run their own establishment or enterprise (with or without partners) without hiring any workers, while 26% were unpaid helpers who assist household members in running their enterprise, but do not receive any regular wage or salary. Only 4% of self-employed were employers (who rune their enterprise by hiring workers)." 60% of the self-employed work in agriculture, and 80% earn less than Rs 15,000 per month. Majority of Indians prefer the assurance of a salaried job than being self-employed. "When factory owner Amit Nagpal closed shop and joined a call center on a fixed salary, he joined a growing trend in urban India where self-employment has become an untenable career option." Gandhi had the Indian state to maintain his poverty in style but Indians don't want to spin a 'charkha' (spinning wheel) as a career. The latest catchphrase in India is 'inclusive growth'. "The biometric-based unique identification system, Aadhaar, now ensures the poor are no longer invisible and, therefore, more empowered." In other words, inclusive growth means subsidies in India. According to the World Bank "absolute pro-poor growth can be the result of direct income redistribution schemes (subsidies), but for growth to be inclusive productivity must be improved and new opportunities for employment created". According to the World Economic Forum, an exclusive club of the very rich, inclusive growth means "concrete solutions to drive change by providing a one-stop-shop to make global business and policy practices more transparent, inclusive and sustainable" so that it can "generate high social and financial returns". The recent victory of Chief Minister Arvind Kejriwal in assembly elections in Delhi "has been partially attributed to the freebies and subsidies given to the electorate", wrote R Jagannathan. That is why 'inclusive growth' is so attractive in India. "As Winston Churchill said, the core vice of capitalism is unequal sharing of blessings and the inherent virtue of socialism is equal sharing of misery," wrote Prof Ramesh Thakur. Maira should learn.  

Wednesday, February 19, 2020

The Humpty Dumpty of India.

Using technology, "the Chinese government has created a vast citizen surveillance complex. Using facial recognition, it assigns social scores to citizens based on their behavior in public places," wrote Siddharth Pai. Now that face masks have become mandatory because of the coronavirus epidemic the "near ubiquitous facial-recognition surveillance cameras" have become useless. "Recently, former minister of state for civil aviation, Jayant Sinha, celebrated the launch of DigiYatra, endorsing the omnipresent use of facial recognition in airports where someone's face would suffice as the boarding pass," wrote Choudhary and Prof Moglen. "In the 21st century, an Aadhaar number, a mobile handset's IMEI number, and the unique network address of a wifi adapter in smartphones, for example, can locate users in the digital world." "Once cameras are connected to the facial recognition software, citizens have no privacy anywhere. To those with power -- government or businesses -- people are seen, recognized, analysed, predicted and controlled all the time. This technology can be used to perfect despotism." Just as Aadhaar was forced on citizens, the government is preparing to index every Indian on multiple lists. It started with the Citizenship Amendment Act (CAA) which seeks to protect minorities escaping religious persecution in 3 Muslim nations by giving them citizenship, while Muslims without visas will be expelled. To find out who has entered illegally a National Register of Citizens (NRC) is to be compiled wherein every person will have to provide documents to prove he/she was born in India. At the same time a national census, the National Population Register (NPR), which is conducted every decade, is to start on 1 April. A survey by the National Family Health Survey 2015-16 found that one in five children under the age of five is not registered at birth, "voters enrolments among new eligible voters has been low in this country", and 20% of deaths are not registered, wrote Nikhil Srivastav. So genuine citizens are in danger of being excluded from NRC. Since 2014, the Central government has been pushing digitalization aggressively along with "an obsession with identity of Indian residents and an excessive zeal in linking almost all personal data to centralised databases administered by the Center", wrote an editorial in the Times of India. "With the burden of accountability placed squarely on the shoulders of the citizen, it lets the government of the hook ," wrote an editorial in The Indian Express. While bullying citizens, the government has weakened the Right to Information (RTI) Act so as to avoid having to answer any uncomfortable question. Surely, we have courts and judges to protect us from a predatory government? With the highest ever strength of 34 judges, the Supreme Court "has not set aside the time to hear habeas corpus cases of hundreds of Indians detained in Kashmir", wrote Prof S Rajagopalan. "Constitutional lawyer Gautam Bhatia has dubbed it an 'absentee constitutional court' that has 'dodged, ducked, evaded, and adjourned' the problem." No wonder people are taking matters into their own hands. Trust is Humpty Dumpty. Can't be put together once broken.    

Tuesday, February 18, 2020

Isn't it suspicious when they are ready to sacrifice 60 million?

"More than 3,000 travelers on two coronavirus-stricken Carnival Corp. cruise ships are returning home, fanning out to more than 40 countries and fueling fears of further contagion from the deadly virus." "On Saturday, an 83-year-old American woman tested positive in Malaysia, a day after she and 2,200 others were cleared to leave the cruise ship Westerdam in Cambodia.The ship arrived there after being turned away by five other ports." Now there is a scramble to track thousands of contacts of the affected woman. "Westerdam representatives said the company had checked that no one on board the ship had traveled to mainland China in the 14 days prior to the cruise." 322 out of total of 380 Americans on board the Diamond Princess were evacuated to the US, of which 14 are positive for the virus. The affected people were taken to hospital while the rest will have to spend 14 days in quarantine. The Chinese Center for Disease Control and Prevention (CCDC) analysed records of 72,314 patients, of which 44,672 were confirmed cases of coronavirus, 16,186 were suspected cases and 889 cases were asymptomatic carriers of the virus. 81% of cases were classified as mild. We don't know how long the virus may last in airways of carriers and how infective they are during that period. "If the virus isn't halted, it could infect 60 percent of the world's population and kill one in hundred of those infected -- around 50 million people -- Gabriel Leung, at the University of Hong Kong, told The Guardian on 11 February." "Sen. Tim Cotton is persistently resurfacing a debunked theory which claims the deadly coronavirus sweeping the globe is the work of Chinese scientists at a secret Wuhan lab for biological warfare," wrote two Bill Bostocks. "The rumor is circulating but there is no evidence to date that this is true," said an expert. Right. But there is no evidence that it is untrue either. We know that the paradoxically named National Biosafety Laboratory that conducts research on "fulminant infectious disease pathogens" is based in Wuhan. We also know that initially local government officials tried to suppress news of the outbreak by threatening doctors to keep quiet and as soon as the government in Beijing became aware of the problem they put the entire Hubei province with 60 million people in lockdown. Why? This kind of isolation has never been practiced, even during the time of plague, cholera or smallpox epidemics. "China has flooded cities and villages with battalions of neighborhood busybodies, uniformed volunteers and Communist Party representatives to carry out one of the biggest social controls in campaigns in history." What do they know that we don't? The Spanish flu pandemic in 1918 killed an estimated 20-50 million people worldwide and the ordinary seasonal flu kills around 650,000 people every year, according to the WHO. It maybe unproven but China's reaction is totally excessive for an illness which is mild in 81% of cases. Knowing China we are right to be suspicious.   

Monday, February 17, 2020

Will they be made to pay for bad karma?

"A revival in the GDP growth rate is key to the Indian economy." "Shukla of M&M says the biggest factor handholding the weak economy is central government spending, which went up 32% year-on-year (YoY) in the October-December quarter," wrote Suman Layak. In percentage terms India's YoY industrial growth is below those of China, South Korea, Indonesia and Russia but higher than those of Germany, South Africa, France and the US. Of course, a YoY figure depends on base effect, which means a comparison with last year's figure, and in absolute terms, a 2% growth in the US would be much larger than a 5% growth in India because the US economy is 7 times the size of India's. The government needs money to spend, which it collects through taxes, fees and through disinvestment, which means sale of public sector assets. Any shortfall is plugged by borrowing from the market, mainly banks, known as fiscal deficit. Growth, not fiscal fundamentalism, is the best antidote to a host of ills, economic and social," wrote Mythili Bhusnurmath. "In a scenario where government spending is the only game in town to keep the wheels of the economy turning, blind adherence to an arbitrary fiscal rule would have been not just unwise, but foolish." The government set a fiscal deficit target of 3.8% of GDP in this year's budget, which is higher than its initial prediction of 3.3%. Sounds reasonable. "But if we look through the accounting tricks, the full deficit is perhaps 7.5-8% of GDP, making India a world champion in fiscal profligacy," wrote SA Aiyer. The Mint compared India's economic parameters with nine other emerging market (EM) economies. According to the International Monetary Fund (IMF), India's fiscal deficit at 7.5%, is the joint highest, with Brazil, among EM countries, which average around 3%. At 17.1%. India's tax collection is lower than the EM average of 20.9%, which means India's debt-to-GDP ratio is second highest at 69% and interest payment is also second highest at 6% of total government spending. Naturally, India's cost of borrowing is higher than others at 6.5%. To plug the hole in revenue taxes were increased in the budget. Foreign investors are thinking of paying taxes at a lower rate in Singapore rather than the high rates in India. To save money, the Central government is not transferring adequate funds to the states as their share of the Goods and Services Tax (GST). "This failure to share revenues with the states now threatens overall development," wrote Rajrishi Singhal. The biggest asset with a total life fund of Rs 28.3 trillion is the Life Insurance Corporation of India (LIC) and the government hopes to raise a whopping amount of cash by selling a chunk of LIC. However, the LIC has non-performing assets (NPAs) of Rs 326.85 billion which is 7.5% of its debt portfolio. "I would never touch LIC as an investor. The government sold their unsold items to LIC and now they are selling the owner of those unsold items to us," said Shankar Sharma. Payment for bad karma.

Sunday, February 16, 2020

Green must be in the glasses of the beholder.

"India's rural inflation rate surged faster than urban inflation for the first time in 19 months in January, and economists are optimistic that signals something the country desperately needs -- a revival in demand in the rural economy." "Rural inflation rose to 7.73% in January, higher than urban inflation rate -- which was 7.39% -- for the first time since January 2018." This is good news because higher prices for farm produce provides higher income for farmers which will enable them to spend more on consumer goods and services. Since around 58% of the Indian population is dependent on agriculture, higher spending by them will increase demand, which may lead to increase in investment, and  higher tax collection. However, Prof Himanshu remains unimpressed. Food-grain inflation has climbed from 1% at the end of 2018-19 to 7.3% in January 2020. "It has also spread to other food items such as milk (5.6%), eggs (10.4%) and meat products (10.5%), most of which are not seasonal, but have been pushed up by rising feed prices." Expenditure on food has been declining for decades due to rising prosperity. "It has declined from 72.83 percent (as percentage of total expenditure) in 1972-73 to 52.76 percent in 2011-12." If a relative reduction in spending on food is a sign of prosperity, why do we have one-third of the total number of stunted children in the world? "According to the latest Commerce Ministry data, total farm exports during April-December 2019, at $26.32 billion, stood 7.9% lower than $28.59 billion for the first nine months of 2018-19. At the same time imports went up 4.1% from $16.08 billion to $16.75 billion," wrote Harish Damodaran. If we are exporting less, leaving more for domestic consumption, and importing more, food prices should be falling, not rising. There is a "consumer bias" in the government's policy towards agriculture, wrote Prof Ashok Gulati. "Any rise in domestic prices immediately leads to the imposition of market restrictions." "Annual retail inflation rose to 7.59% in January, partly driven by rising vegetable prices. December industrial output contracted 0.3%, after rising for the first time in three months in November." "India's wholesale inflation accelerated to 3.1% in January, driven up by fuel and power, and manufactured products, data released by the commerce and industry ministry showed on Friday." Rise in the cost of fuel is mysterious because the price of crude oil has fallen from $71 per barrel in May 2019 to around $55 per barrel today. According to a survey by the Reserve Bank (RBI), consumer confidence fell to 83.7, where 100 is the neutral figure, and industrial capacity utilization dropped to 69.1% from 73.6% in April-June 2019. Capacity utilization has to be over 80% before companies will invest in new projects. And yet retail inflation is surging. No problem. The Finance Minister can see "green shoots". Thank God for her colored glasses.   

Saturday, February 15, 2020

Why are they so innocent?

"In any economy, there are four sources of demand: investment, exports, government consumption expenditure, and private consumption expenditure," wrote Prof Deepak Nayyar. Exports have been stuck at around "$300 billion per year for the past six years", private final consumption expenditure is down as shown by "Consumer spending in India declined for the first time in more than four decades in 2017-18, Business Standard has reported citing a government survey that has yet not been released." To add to the misery, "Consumer sentiment in India worsened to an almost five-year low and manufacturing slack at companies widened to the most on record, indicating Asia's third-largest economy is yet to put a floor under growth, wrote Anirban Nag. As for investment, Indian banks are saddled with a "twin balance sheet problem", so they are reluctant to lend. "During H1 FY20 (first half of financial year 2019-20), more than 60% of projects contracted funding largely through external commercial borrowings (ECBs). Low global interest rates and a general unwillingness of Indian banks to lend seems to be the reason behind this," wrote Aparna Iyer. The only solution is to raise private consumption expenditure "by counter-cyclical policies that increased government expenditure " which, in turn, would reduce fiscal deficit by increasing government revenue, wrote Nayyar. Consumer food inflation was 13.63% in January, partly because of "an artificial supply shock created by the government, which has mopped up almost one-third of all production for stocks", wrote Prof Himanshu, while real wages of agricultural and non-agricultural  laborers declined. "The best way of reviving the economy lies in helping the poor increase their real incomes by spending money on social security schemes and rural infrastructure." The chief economic adviser (CEA) Krishnamurthy Subramanian shrugged off vegetable price inflation. "By July-August, I expect a convergence between headline and core inflation," he said. He did not say whether this would be because of base effect or because he is predicting a good monsoon. Those who want the government to increase spending because fiscal deficit is comfortable are living in "fantasy land, wrote SA Aiyer. "The combined deficits of the central and state governments are high enough to have caused financial meltdown in most countries." Formally the combined deficit adds up to 6%, "But if we look through the accounting tricks, the full deficit is perhaps 7.5-8% of GDP, making India a world champion in fiscal profligacy." "The risk is that India will remain in the 5-6%, slow-growth groove for some time." So, the government is not spending too little, it has spent way too much on social schemes. And its piggy bank is empty. Economists are too innocent. They believe what they are told.    

Friday, February 14, 2020

Can a bank unite so many nations?

President of the European Central Bank (ECB) Christine Lagarde is to undertake a strategy review on "how the ECB is likely to address persistently low inflation in the eurozone", wrote Prof Lucrezia Reichlin. Following the financial crisis in 2008, the ECB has been proactive -- introducing negative interest rate in 2014, providing the market with "forward guidance" on its future policy and inflating its balance sheet by buying assets, known as quantitative easing (QE). Inflation rate in the eruozone is expected to be 1.4% in January, up from 1.3% in December. Despite its best efforts the ECB has failed to get inflation up to around 2% which is its ideal rate. "A legacy of high unemployment, particularly in those countries that were at the forefront of the region's debt crisis last decade, is one reason why it has it has kept a lid on wage increases." Maybe the ECB should have been more aggressive at the beginning or it could be due to "inadequate coordination of fiscal, financial and monetary policy". While the ECB was increasing monetary stimulus Germany was running large budget surplus. "Global central bank governors and economists argued that Germany -- boasting the largest economy in the eurozone -- is in a position to provide fiscal stimulus but has instead opted to maintain a flush budget surplus." But German finance ministers refer to the hyperinflation in the 1920s and so are reluctant to run a deficit. "In fact, they even have a term for such conservatism, Schwarz Null, or 'black zero', meaning a balanced budget or budget surplus ('in the black')." Despite a budget "surplus in 2019 for the eighth time in a row, amounting to 49.8 billion euros ($55.4 billion)", "The 2019 full-year gross domestic product (GDP) shows a slowdown from the 1.5% growth recorded in 2018 and the 2.2% expansion seen in Germany's economy in 2017." Perhaps, the most plausible reason for the "persistently low eurozone inflation reflects structural factors such as adverse demographics, low growth expectations and the associated increase in demand for safe assets". "After 1,316 days of political turmoil, the UK now stands alone as the first nation to have ever left the European Union." However, this is the beginning of the 'transition period' during which Britain must sign a comprehensive trade deal by 31 December. Britain being the sixth largest economy in the world its exit will certainly affect Europe's economy. According to research by Bloomberg Economics Britain has already lost 130 billion pounds and will lose another 70 billion pounds by the end of this year. Europe, and especially Britain, got rich by exploiting their colonies and that kind of plunder is no longer possible, wrote Prof VA Nageswaran. European nations may not be fighting but they still do not agree with each other. The ECB can do little.

Thursday, February 13, 2020

Protection from wealth, but not from disaster.

"The government is finally talking about manufacturing-led exports," which is good, but "it is getting increasingly protectionist on the trade front, by increasing customs duties and planning other measures," wrote Vivek Kaul. "The weighted average tariff rate in 1990 stood at 56.4%. In FY91 (financial year 1990-91), total exports to gross domestic product (GDP, a measure of the size of the economy) was 6.24%." By 2013, the average tariff rate had fallen to 6.34% and exports peaked at 25.18% of GDP in FY14. Since 2014, exports have fallen to 19.5% of GDP. We need to import many things that are not available locally and to pay for that we have to sell products that we excel in, wrote Prof Ricardo Housmann. But, foreigners have a choice of where to buy from so we have to compete. "Because they are subject to greater competition, export activities tend to undergo faster technological and productivity improvements than other parts of the economy." Customs duty on several imports were raised in the 2018 budget and this year's budget "raised customs duties on 37 items in order to provide a level playing field for domestic industry". Will this increase exports? "No," wrote Puja Mehra. "Being a global player and sustaining high growth demand a higher share of exports in global value chains." Customs duty on mobile phones was increased from 0 to 10% in 2017, to 15% the same year and to 20% in 2018. While import of mobile phones fell from $4.47 billion in 2013 to to $3.31 billion in 2017, import of telecom parts increased from $1.34 to $9.41 billion. It was $16.28 billion in FY19. India exported mobile phones worth $2.7 billion in 2013 which fell to $1.4 billion in FY19. Higher import price allows domestic producers to increase prices, so mobile phone prices jumped 0.5% between April and December FY20. Rather than expanding, the Index of Industrial Production (IIP) contracted 0.3% in December. "On the whole, between April and December 2019, the IIP has now shown a cumulative growth of a meagre 0.5%." The financial year starts on 1 April, which is when the budget changes kick in. "No country has achieved developed status on the back of a purely domestic economy." wrote Sundeep Khanna. East Asian nations like Hong Kong, Singapore, Taiwan and South Korea "used their highly developed ports and well-educated population, while investing in industrial infrastructure and offering massive tax concessions to foreign investors, to yank themselves out of poverty into prosperity by exporting everything from computers to cars". Since the 1980s, the world has experienced 3 episodes of debt crisis, wrote Prof Kaushik Basu. "By the time of the debt wave in 2008, India was globally integrated and severely affected. But its economy was growing at nearly 10% annually and it recovered within a year. Today, India's economy is facing one of its deepest crises in the last 30 years," so we could go under. Higher duties are protecting us from becoming rich but will not protect against a crisis. Heads we lose, tails we also lose.     

Wednesday, February 12, 2020

Who will pay a heavier price?

In assembly elections held on 8 February in Delhi, the Aam Aadmi Party (AAP) of Chief Minister Arvind Kejriwal trounced Prime Minister Narendra Modi's party the BJP. Out of a total of 70 seats, the AAP won 62 and the BJP won just 8. Congress was wiped out, getting just 5% of votes, with 63 of its 66 candidates losing their deposits. How did Kjriwal pull it off?  "Providing free power up to 200 units every month for households paid handsome dividends for the incumbent Aam Aadmi Party (AAP) in Delhi elections." In addition, AAP promised free bus rides for women, free pilgrimage for senior citizens and many other freebies. The BJP and the Congress also promised a list of freebies but AAP has been providing free electricity, water and health clinics for 5 years, so it was believed. According to Shekhar Gupta, "nationalism plus religion and socialism is a killer combination electorally". "Nothing can challenge or hurt it. We've been living through this reality since 2014, the Narendra Modi-Amit Shah era." Kejriwal proved his Hindu credentials by singing the Hanuman Chalisa on TV, distributed handouts liberally and was quick to announce "ex-gratia payments to the families of soldiers killed in action on a scale unprecedented in India", while sidestepping protests against the Citizenship Amendment Act (CAA) in Delhi to prevent accusations of being anti-national or pro-Muslim. Despite opposition to CAA by the Congress  Muslims voted for AAP. Modi boasts of revoking Article 370, which gave a special status to Kashmir. Article 370 was revoked on 5 August 2019 and Kashmir was placed in a lockdown with curfew on movement of people, shutdown of the internet and arrests of local politicians. Internet access was partially restored last month but is suspended on special days. Former Chief Ministers Mehbooba Mufti and Omar Abdullah have been under detention since 5 August and have been charged under the Public Safety Act just days ago. The police charge against Abdullah was his ability to "convince his electorate to vote in huge numbers", said an editorial in the Indian Express. Mufti was compared to a medieval queen due to "her dangerous and insidious machinations and usurping profile and nature". The queen referred to was Kota Rani, who lived in the 14th century and apparently led a colorful life, presumably in an effort to survive in those uncertain times when one could be killed by a powerful enemy. "Official orders served upon former J&K CMs Omar Abdullah and Mehbooba Mufti while seeking their detention under the Public Safety Act (PSA) have not included phrases such as 'radical ideology' and 'daddy's girl' that were part of dossiers sent by J&K Police." Kejriwal may find it easy to promise handouts but may find it difficult to finance them, while Modi found it easy to get into Kashmir but may find it impossible to get out. The future maybe fraught.

Tuesday, February 11, 2020

Are the shoots really that green?

"Finance Minister Nirmala Sitharaman Tuesday said the economy was set to turn around, citing seven 'green shoots', including higher foreign direct investment and Goods and Services tax (GST) collections." "It's not in trouble -- I'm giving you green shoots," Sitharaman said in the Lok Sabha strongly defending the government's management of the economy and the budget. She is compelled to say that because if she says the economy is on life support, as claimed by former Finance Minister P Chidambaram, the share market will collapse, foreign funds will sell out and the rupee will fall below 100 to the dollar. However, Sitharaman has the US on her side, which "on Monday removed India from its list of developing countries that are exempt from investigations into whether they harm American industry with unfairly subsidised exports". "The US removed India from the list on account of it being a G-20 member and having a share of 0.5% or more of world trade." "India's share in global trade (merchandise and services) was 2.1% (481.74 USD billion out of total 23,044 USD billion) billion for exports and 2.6% (600.62 USD billion out of total 23,112 USD billion) for imports in 2017," said the Ministry of Commerce and Industry. We have a negative trade balance of $ 119 billion. China, on the other hand, has a positive trade balance of over $359 billion and accounts for 19.51% of total world exports and 18.73% of total world imports of goods and services. In 2000, China was granted most favored nation status by the US on a permanent basis. "India's average tariff rate in 2018 was 17.1% -- that is significantly higher than the US, Japan and the EU, all of whom had rates between 3.4% and 5.2%" Tariffs have been hiked substantially in this year's budget. "Green shoots" can't come fast enough because the government is milking the Reserve Bank (RBI) to finance its expenditures. This, despite forcing the RBI to transfer Rs 1.76 trillion from its reserves in this financial year. With constant tinkering of taxes in order to extract revenue, "More Indian startups are incorporating their businesses overseas. Singapore, the United States, the United Kingdom, the Netherlands and the United Arab Emirates are being preferred due to stable regulations, subsidised tax rates." "There is a problem when large hedge funds and blue-chip private equity investors ask where the company is based before getting to the business model," said a startup founder. Top government hospitals, catering mostly to the poor, are to get less money. Green shoots denote health. How, when the sick are to endure? 

Monday, February 10, 2020

Not sure what they want to protect.

"How did Western nations pull away?" asked Prof VA Nageswara. "One thing that enabled Britain to develop was that the British state was, first and foremost, a war machine." That is obvious. The East India Company defeated the Portuguese in India in 1612 and won monopoly power of trade. It enslaved people and by early 18th century it had morphed into an occupying power of British repression. "In the mid 18th century the population of Britain was about 6 1/2 million. In the late 18th century it grew rapidly and by 1801 it was over 9 million." In contrast, "The Indian population was about 100 million in 1500. Under the Mughal Empire, the population rose to 160 million in 1700." The rise of the British economy was "less a distinct entrepreneurial and technocratic culture than one predominantly defined within an institutional framework spearheaded by the excise and a wall of tariffs". And relentless plunder of its colonies. Renowned economist Utsa Patnaik "in her essay published in Columbia University Press recently, said Britain drained out over $45 trillion from India, which to date has hampered the country's ability to come out of poverty". Whether the British cut off fingers of weavers in Dhaka is disputed but they definitely destroyed our textile industry by imposing tariffs on our textiles while making us pay for cloth from textile mills in Britain. All those mills lie in ruins as cheaper imports from Asia have destroyed British textile industry. The US became rich, first by eliminating Native Americans, and then by using slaves to grow cotton. By the time of the Civil War, the US supplied 75% of the world's cotton, picked by slaves, and there were more millionaires in the southern states of the US than anywhere in the world. Slaves themselves were wealth. They were encouraged to breed and the children were born as slaves, to be sold when they grew up. "India needs to learn that it cannot fight shy of adopting restrictive trade practices when needed. The Union budget for 2020-21 does it well," wrote Nageswaran. "A little more than two years ago, when GoI (government of India) raised some tariffs, as an eternal optimist, I took the view that this was an isolated action driven by a bureaucrat steeped in socialist era thinking," wrote Prof A Panagariya. "Not only have tariff increases continued, licence permit raj-era protectionist vocabulary also has had a comeback." Srei Infrastructure Finance Ltd will stop financing infrastructure projects. Vice Chairman Sunil Kanoria said, "India being a socialist economy, we should let the government do it," The government is to pass a law to protect foreign investment. Protection from whom? From the Indian government. Tariff increases collect more taxes and, by protecting domestic prices from competition, protects high taxes on domestic products. Hapless consumers pay. 

Sunday, February 09, 2020

Why is the government trying to prove Imran Khan right?

A 14 year old Christian girl was abducted in October, forcibly converted to Islam and forced to marry her abductor Abdul Jabbar in Pakistan. This is nothing new as Hindu girls are regularly abducted and raped in that barbaric country. A judge ruled that rape of a 14 year old is allowed under Sharia law because she had had her first period. The Citizenship Amendment Act (CAA) is designed to grant citizenship to refugees of Hindu, Christian, Sikh, Buddhist and Zoroastrian communities in Pakistan who manage to escape from violence perpetrated against them. Since Muslims are the majority and are the ones committing these crimes they have been excluded from the Act. Instead of condemning rape, Pakistan Prime Minister said, "We are witnessing a fascist, racist government in India." Only a fanatical pervert can be that shameless. He even had the gall to threaten nuclear war with India. Why the protests against CAA? Surely every civilized person should support an Act meant to protect refugees fleeing violence and rape? Widespread protests against CAA are because the government is contemplating a National Register of Citizens (NRC) for the whole nation even after a restricted exercise in Assam supervised by the Supreme Court resulted in confusion as over 4 million residents were unable to prove their citizenship. The final list published on 31 August 2019 reduced the exclusions to just over 1.9 million. "In Assam, the NRC asked people to produce documents proving they were Indian. A whopping 1.9 million failed to produce documents, of whom 1.2 million were Hindus, 0.6 million were Muslims and 0.1 million were tribals," wrote SA Aiyer. People think that CAA was passed to protect Hindus, while Muslims, even those born in India but with no documents, would be deemed illegal. The government is engaged in a census to compile a National Population Register (NPR), "But today, for fear of losing citizenship, many Indians refuse to answer questions, and even beat up surveyors." Which means there will be no reliable statistics about India's demography, said Aiyer. The NPR is being linked to biometric data known as Aadhaar which will enable surveillance of every citizen and may even result in a Social Credit System, like in China. As if to prove Imran Khan's allegation of being fascist, the Central government and its allies in states have responded with extreme violence. At least 25 protesters have been killed by the police in India, 18 of them in UP alone where Chief Minister Yogi Adityanath promised revenge against protesters, wrote an article in Gulf News. An entire school in Karnataka has been charged under the law against sedition, enacted by the British in 1870 to suppress Indians, in response to a play against CAA. The teacher who wrote the play has been arrested and pupils of the school are being interrogated by the police for up to 4 hours at a time. Protesters are reading the preamble to the Constitution to show up police repression and a team of lawyers is working to protect protesters from arrests and other actions by the police. Trying to protect refugees from Pakistan by killing Indian citizens. Whose government is it?