Is it tunnel vision or deliberate disinformation?

"Three decades after the start of inflation targeting (IT) policy in New Zealand, and after its adoption in 33 countries, a question worth asking is whether it has succeeded in its primary objective of reducing inflation," wrote economist Surjit S Bhalla. "The last two entrants to adopt the IT arsenal (an appropriate use of the warlike term is because its proponents do want to wage a war against the scourge of inflation) were Argentina and India in 2016." Argentina may have adopted IT, "But in 2018, market expectations about its prospects changed, triggering a deep, prolonged currency crisis that eventually rendered the country's foreign-currency-denominated public debt unsustainable," wrote Argentina's minister of economy Martin Guzman. Inflation rate shot up to over 50% in 2019 and was still over 40% in February 2021. This has resulted in a steep fall in the value of the peso against the US dollar, which in turn fuels inflation by raising the cost of imports. Targeting inflation through high interest rates has no effect on inflation control but was the "primary cause of the GDP growth decline from 8 percent (pre-IT) to 5 percent (post-IT)". Actually, GDP growth rate subsided to just 4% in 2019-20, before the onset of the coronavirus epidemic. Bhalla conveniently forgets the devastating effect of a sudden demonetization of 86.4% of total currency in circulation in November 2016 and the goods and services tax (GST) mess in 2017 which impacted growth according to a report by the State Bank of India (SBI). Not only is the GST extremely complex with many rates of taxes but is also the highest in the world according to the World Bank. "The tax rates in the Indian GST system are among the highest in the world. the highest GST rate in India, while only applying to a subset of goods and services traded, is 28 percent, which is the second highest among a sample of 115 countries which have a GST (VAT) system and for which data is available," the World Bank said in a report." The present governor of the Reserve Bank Shaktikanta Das was appointed in December 2018 when the repo rate was 6.50% since when it has fallen to 4%. In its latest meeting in February the RBI left the repo rate unchanged at 4% even as the consumer price index (CPI) rose to 5.03% in February compared to 4.06% in January. "With bond yields rising the world over, the Reserve Bank of India (RBI) has warned against bond vigilantes, stating they could undermine the recovery, unsettle financial markets and trigger capital outflows from emerging markets." "Yields on US Treasuries have surged to their highest level in more than a year from record lows hit in 2020, as Federal Reserve commitments to hold rates near zero for years to come encouraged investors to bet economic growth and inflation will heat up," reported Reuters. Goldman Sachs predicts that the US economy will grow by 8% this year although inflation will remain within the Fed's comfort zone of 2.1%. Consistently running inflation at a rate higher than that of the US means that the rupee will have adjust against the dollar and a weaker rupee will increase the cost of imports, which grew to $40.6 billion in February giving a trade deficit of $12.9 billion. Why blame others when so-called economists have tunnel vision?     

The first signs of an ignominious storm?

 "Indian state refiners are planning to cut oil imports from Saudi Arabia by about a quarter in May, in an escalating stand-off with Riyadh following OPEC's decision to ignore calls from New Delhi to help the global economy with higher supply," reported Reuters. Saudi Arabia asked India to use some of the 16.71 million barrels of crude oil it bought at $19.90 per barrel in April-May 2020. Oil Minister Dharmendra Pradhan "felt rising oil prices were hurting economic recovery and demand". How? It is not as if the government will pass on the lower price to customers to bring down transport costs and the resultant prices of goods and services. When Prime Minister Narendra Modi came to power in 2014, petrol was selling at Rs 75 a liter when the price of crude oil was at $110 a barrel but now we are paying Rs 91 per liter at the pump when crude oil is selling at a little over $60 a barrel. The reason is extortionate taxes. "Which essentially means, whatever changes with crude, only about 30% of Indian retail prices will be impacted. As much as 70% of the local prices will remain unaffected," analysed The Economic Times. Having left the European Union the UK wants a free trade deal with India for which UK Prime Minister Boris Johnson was invited as a special guest to the Republic Day ceremony, reported Hindustan Times. Naturally, Britain will want easier access to the Indian market for its Scotch whiskey. To preempt that the government reduced excise duty on imported alcohol from 150% to 50% and added 100% cess, thus keeping the total tax the same. Saudis and British, are they idiots? Modi has blocked the export of 5 million doses of the coronavirus vaccine to the UK, reported Mail Online. "The Serum Institute has denied being responsible, saying the export was blocked by the Indian government in what some branded a case of 'vaccine nationalism' akin to the EU's threat to block Pfizer jabs bound for the UK." It is not because of increased demand at home because India has exported 58.4 doses of the vaccine to 70 countries. Naturally, the Brits are furious and not afraid to show it. Noted scholar and commentator Prof Pratap Bhanu Mehta resigned from Ashoka University saying that he has become a "political liability". He has been openly critical of repression of the people by the government, and its "extraordinary machinery of communication, which literally deploys as many elements in a communicative tool kit as there are feathers in a dancing peacock". Former chief economic adviser Arvind Subramanian also resigned from Ashoka University saying Mehta's ouster was "ominously disturbing". India has till the middle of April to file an appeal against the award of $1.4 billion compensation to Cairn Energy which has already started the process of seizing Indian assets overseas. What ignominy! An American digital forensics consulting firm reported that "fabricated" evidence was planted in gadgets seized from the house of activist Rona Wilson. Democrats in the US Congress have been critical of the Indian government, wrote Seema Sirohi last February. Democrats are now in power and may ask inconvenient questions. A storm seems to be brewing. Whether it is perfect remains to be seen.

Just to make everyone happy.

"India's growth troubles appear to be over, and the economy -- one of the hardest hit by the Covid-19 pandemic -- will see a turnaround and move upward from here, with the massive spending announced by the Center, hoping to lift the economy out of one of the world's worst disruptions caused by the pandemic, the Reserve Bank of India (RBI) Governor, Shaktikanta Das said." You don't need a degree in economics to say that, after the country was brought to a standstill on 25 March 2020 when Prime Minister Narendra Modi announced a lockdown with just 4 hours notice, setting of a frenzy of panic buying as people crowded into shops to buy essentials. "On March 25, when India had reported only 500 cases, the country went into one of the strictest lockdowns in the world. The first set of curbs remained in place till April 14 and was extended four times, each time with gradual relaxations. The rest of the world adopted different models," reported Hindustan Times. All production came to a halt as millions of suddenly unemployed migrant workers walked hundreds of miles back to their villages. "The 11.5% growth projected by the International Monetary Fund (IMF) for India in fiscal 2022 will be largely mechanical, as the economy normalises from an 8% contraction in the ongoing fiscal year, IMF chief economist Gita Gopinath said." Which meant that, the economy must grow as people do whatever it takes to survive. Budget for 2021-22 was presented to Parliament on 1 February. "Finance Minster Nirmala Sitharaman loosened the fiscal purse strings in a decisive budget that sought to boost growth and pursue wide-ranging reform measures, without imposing additional burdens on taxpayers and consumers," wrote Aprana Iyer and Asit Ranjan Misra. "The government will spend Rs 5.54 trillion towards capital expenditure in FY22, a 26% jump from what it spent in FY20 -- Rs 3.35 trillion." The fiscal deficit will be high at 6.8% of GDP this year, "But the government deserves kudos for not worrying about what the rating agencies would say, and staying focused on the task of reviving the economy," appreciated TK Arun. "The task of fiscal consolidation has been pushed back, sensibly." So, will India be the land of milk and honey? Seems that the extra spending by the Center will be by depriving the states of Rs 2.7-3 trillion in compensation for GST shortfalls, thus cutting capital expenditure of the states. Non-performing assets of banks are being understated by banks. said Saswata Guha, as the government suspended the insolvency law for one year to protect companies from bankruptcy. "The government should restart the Insolvency and Bankruptcy Code (IBC) process, suspended since March 25, 2020 to revive the economy. Simply extending the moratorium will only add to the stress in the system, without bringing relief to companies or banks," wrote an editorial in the Economic Times. The Index of Industrial Production (IIP) contracted in financial year 2020-21 (FY21) "over a base that contracted in FY20", wrote Udit Misra. "The maximum contraction is happening in the two sectors -- manufacturing and mining -- which are also the most crucial sectors for creating jobs." India and Philippines would be most vulnerable to a taper tantrum, warned S&P. If the US Federal Reserve starts reducing its bond buying program. Lots of traps waiting. But, no harm in a bit of kidology.

Not the foreigners, ask us what we feel.

"The ministry of external affairs is mulling a 'world democracy report' as well as a 'global press freedom index' to be brought out by an independent Indian think-tank, according to people familiar with the matter and government documents reviewed by HT (Hindustan Times)." Trouble is, will anyone, except Bhakts who believe that Prime Minister Narendra Modi can walk on water and levitate across the nation, believe a word of the report, given the way 21-year old Disha Ravi was abducted from her home in Bengaluru by Delhi Police and locked up for weeks without any evidence. Modi promised "freedom of speech and expression" in 2014, but "Six years on, many believe, India's democracy looks diminished, by what they say are persistent attacks on the freedom of the press," reported BBC. Investigative news magazine Caravan has suffered. "Ten sedition cases have been brought against three of its senior-most editorial stuff - the publisher, editor and executive editor - in five states for a story and tweets relating to the death of the protester." The Indian government took strong exception to a discussion in the British House of Commons on the protests by farmers from Punjab and Haryana against 3 farm laws which were forced through the Indian Parliament without any discussion. India says how it treats its citizens is its internal matter just as China claims on its treatment of Uighurs in Xinjiang province. Bhakts may see nothing wrong in persecution of citizens but outsiders are noting a similarity between India and China. It is "Time to send a strong message to Britain," fulminated Kanwal Sibal. "The British high commissioner in Delhi was rightly summoned to lodge a protest but that may not be enough to close the matter. Some conclusions have to be drawn about the British mindset towards India that assumes that its provocations can be cost-free." What Sibal seems to be forgetting is that this government is using laws of the same British against its own citizens. What is the point in setting up a huge committee to commemorate 75 years of Independence from Britain if it is using the British law of sedition to silence opposition, enacted in 1870 by Thomas Babington Macaulay to enforce allegiance to the British monarch? To control the coronavirus spread the government enforced a draconian lockdown with a 4-hour notice on the basis of the Epidemic Diseases Act enacted by the British in 1897 which gives emergency powers to authorities while protecting them against any claims for damages. It must be very embarrassing for the British that an 'elected' government is using colonial era laws to persecute its citizens. "The blunt assertion is that outsiders have no business assessing our democracy. The baseline of the repartee is that voters elect a majority and that is all democracy is all about," wrote Suhas Palshikar. "India's democratic exceptionalism is now withering away," wrote Prof Ashutosh Varshney. "A democracy which speaks with one voice, which elevates citizen duties over citizen rights, which privileges obedience over freedom, which uses fear to instil ideological uniformity, which weakens checks on executive power is a contradiction in terms." "A new report by the US Congress's non-partisan and autonomous research service has taken a critical view of India's handling of the farmer protests, warning that New Delhi's position on the ongoing stir could 'present a challenge' for the Biden administration," When Bhakts need to morph Queen Elizabeth's picture for approval, Britain cannot be blamed in thinking we are still a vassal state. If you treat citizens like dirt the world will relegate you to the dustbin. A police state doesn't understand.   

What if petrol jumps to Rs 120 per liter?

"The wholesale price-based inflation rose for the second consecutive month to a 27-month high of 4.17 percent in February, as food, fuel and power prices spiked. The WPI inflation was 2.03 percent in January and 2.26 percent in February last year." Core inflation was at 5.5 percent in February. "The headline WPI inflation is expected to harden further to around 9-9.5 percent, and the core-WPI is likely to climb to 7-7.5 percent by May 2021, before displaying a more gradual moderation to 4 percent by the end of 2021, said Aditi Nayar." "Retail inflation based on consumer price index (CPI) rose to three-month high of 5.03 percent in February from 4.06 percent in January." "Economists are already raising red flags over the retail inflation trajectory," wrote Aparna Iyer. "Part of the rise in core inflation has also been the surge in fuel prices through transportation component. Here, a $10 per barrel rise in the Indian crude basket pushes up domestic fuel prices by at least Rs 5." "The recent fall in headline inflation, it fell from 7.61% in October 2020 to 4.06% in January 2021, before rising to 5.03% in February, was largely a reflection of food inflation, which fell sharply from 11% in October 2020 to just 1.96% in January 2021," wrote Roshan Kishore. "The non-food basket CPI grew at 5.39% in October 2020, moderated slightly to 5.23% in November 2020 and has been rising steadily in the last three months to reach 5.78% in February 2021." "Price of domestic cooking gas, LPG has doubled to Rs 819 per cylinder in the last seven years while the increase in taxes on petrol and diesel has collections by over 459 percent, Oil Minister Dharmender Pradhan said." Taxes constitute over 60% of the price paid by consumers at pumps, but there is no plan to cut taxes on fuel said the minister. Why should they cut taxes, when the Center has collected Rs 6.85 trillion from taxes on petrol and diesel in the last 3 financial years, from 2018-19 to 2020-21. "The subject matters over which the Center can tax and raise revenue are limited only by the imagination of its bureaucrats. The subject matters over which states can raise revenue are expressly limited," wrote MS Ananth. "State governments are unlikely to relinquish means of raising revenue and allow fuel to be subsumed by GST." Especially as states are being shortchanged of up to Rs 3 trillion by the Center in compensation for a fall in GST collections, while the Center has collected 19.9% of its revenue from cess and surcharges which it does not share with the states. No one is talking about the rupee. Inflation rate in the US was 0.4% in February and 1.7% over the last 12 months. In the euro zone, inflation rose from -0.3% in December 2020 to 0.9% in January 2021. As prices rise faster in India the rupee buys less every month. It has to adjust lower against the dollar, the euro and the yen which will instantly increase prices of imports, including oil. What happens if oil hits Rs 120 per liter? Any answers?

A "good boy" is decidedly not a good thing.

Last month India and China announced that both had withdrawn troops from the Pangong Lake area in Ladakh. Both sides had been facing each other after 20 Indian soldiers died in hand to hand combat with Chinese soldiers in June last year. Recently, China released videos, which apparently were taken during the clash, and admitted that 4 of its soldiers also died in the incident. According to the Russian news agency Tass, 45 Chinese soldiers were killed while according to US intelligence the number of Chinese casualties was 35. However, "China still hasn't withdrawn from 'several forward positions' it seized during clashes with Indian forces along the Line of Actual Control (LAC), a top military commander told lawmakers at a congressional hearing," reported the Hindustan Times on 10 March. "Admiral Philip S Davidson, who commands the US military's Indo-Pacific Command, also told lawmakers that the US had helped India over its border conflict by providing information, cold-weather clothing and other equipment." Our soldiers have been sacrificed. This year's Combined Commanders' Conference of the Indian Armed Forces was "held at Kevadia under the shadow of the Statue of Unity in Gujarat, from 4 to 6 March", wrote Lt Gen H S Panag (retd). The Statue of Unity is that of Sardar Vallabhai Patel, constructed at a cost of Rs 29.89 billion (US$422 million), with brass plates cast by Jiangxi Tongqinq Metal Handicrafts Co in China. For the first time personnel below the rank of commissioned officers were invited, which made no sense, because the strict chain of command in the armed forces means that only senior officers take strategic decisions, though suggestions from all ranks are always welcome. Prime Minister Narendra Modi stressed "indigenisation" of "doctrines, procedures and customs practiced in the armed forces" which was incomprehensible for the army brass. Does it mean control of decision making process in the armed forces by Modi's party the Bharatiya Janata Party (BJP), just as the the People's Liberation Army (PLA) of China owes allegiance to the Communist Party of China? "The United Nations has received $10,000 (Rs 7 lakh) 'donation' from the pro-Khalistan group Sikhs for Justice, an outfit outlawed by India," reported The Times of India. The group has also promised $1.3 million "to investigate India's use of violence and sedition charges against protesting farmers". Meanwhile climate activist Disha Ravi, who spent days in jail on false charges of sedition, has written on Twitter, "Locked in my cell I wondered when it became a crime to think the most basic elements of sustenance on this planet were as much mine as theirs," reported CNN. Meanwhile, multiple courts in different countries have confirmed a $1.4 billion award to Cairn Energy against India. Supporters have created a meme of Queen Elizabeth saying, "You are a good boy" to Modi. Any other leader in the world would consider "good boy" as patronising and extremely insulting. Reduced to this, huh?        

They are not worried, but we cannot control it.

"When you continue to get an upward forecast for the economy and earnings, it is very hard to get bearish because the news keeps getting better and there is also the news on the pandemic," said Hugh Albert Johnson about US markets. "We are about 7% overvalued but believe me it is very hard to get bearish when the news is this good." "The consensus forecasts put 2021 GDP growth at just over 5% worldwide, and near 6% in the United States. I think growth could top 6% worldwide and 8% in the United States, an astonishing pace for a developed country," wrote Ruchir Sharma. Bond investors seem to agree. "A climb in long-dated Treasury yields stoked by US growth expectations has contributed to investors yanking more than $15 billion from bond funds this week, the largest outflow in a year, according to figures released Friday," wrote Carla Mozee. "The 10-year yield was pushed up to 1.639%, its highest in more than a year and the Nasdaq composite dropped 1.5%." "Germany's 10-year borrowing costs jumped 26 basis points in February, the biggest monthly rise in over three years, with similar moves seen across the euro area. Policymakers from president Christine Lagarde to chief economist Philip Lane have expressed unease. Markets want to know the game plan," reported Reuters. "The European Central bank said on Thursday it would accelerate money-printing to keep a lid on euro zone borrowing costs, signalling to sceptical markets that it is determined to lay the foundation for a solid economic recovery," reported Reuters." "Making matters worse, markets are starting to worry about the massive experiment in budget-deficit monetization being carried out by the US Federal Reserve and Department of the Treasury through quantitative easing (a form of Modern Monetary Theory or 'helicopter money'," wrote Prof Nouriel Roubini. "To be sure, inflation may eventually emerge if the effects of monetized fiscal deficits combine with negative supply shock to produce stagflation." While markets worry about inflation, which may force central banks to reduce liquidity and may even make them start raising interest rates, "Treasury Secretary Janet Yellen said US inflation risks remain subdued as the Biden administration pumps $1.9 trillion in pandemic relief into the economy and the return to full employment comes into view," the Hindustan Times quoted Bloomberg. Meanwhile, "Oil prices jumped more than $1 a barrel, hitting their highest levels in 14 months, after OPEC and its allies agreed not to increase supply in April as they await a more substantial recovery in demand amid the coronavirus pandemic." While inflation is not of much concern in US and Europe, the rate of retail inflation in India in February jumped to 5.03% from 4.06% in January. Why? "Price of domestic cooking gas, LPG has doubled to Rs 819 per cylinder in the last seven years while the increase in taxes on petrol and diesel has swelled collections by over 459 percent, Oil Minister Dharmender Pradhan said." In response to India begging OPEC to increase supplies, Saudi Arabia responded that we should use the 16.71 million barrels of crude bought in April-May 2020 at an average cost of just $19 per barrel. Why are we begging? Because reducing taxes will balloon fiscal deficit and not doing so will result in very high inflation. Either way, the rupee will tank. That's when the writing will appear on the wall.  

A demarche shows lack of understanding.

"India issued a demarche on Tuesday on Britain and summoned the British high commissioner to convey strong opposition to the 'unwarranted and tendentious discussion' on India's agricultural reforms in the UK Parliament, which the Indian high commission here described as packed with false assertions and one- sided." A 'demarche' is diplomatic correspondence representing the official views of the government. Which is angry because, "At the debate 17 out of 18 MPs, from Labour, the Conservatives and other parties, condemned India for its treatment of farmer protesters and the alleged crackdown on the press, internet shutdowns and arrest of activists." How dare the British expose repression of Indian citizens when, "Nearly 70% of cases of internet shutdowns globally happened in India in 2020, according to a new report by Access Now, a global non-profit that works on digital rights and online freedom. Out of the 155 instances of internet disruptions, 109 were recorded in India, followed by Yemen with six instances." Another NGO Freedom House in the US downgraded India to partly free which the government dismissed as "misleading, incorrect and misplaced". Foreigners are biased say the Bhakts, a dedicated group of followers of Prime Minister Narendra Modi. Are they? "A law, the Narcotic Drugs and Psychotropic Substances Act, is being weaponised and a premier federal agency  tasked with fighting drug trafficking by mafias at all-India level appears to have become a leaky instrument out to smear individual reputations by innuendo, helpfully amplified by gutless TV channels willing to play accomplice," wrote an editorial in The Indian Express. The agency is headed by a Gujarat-cadre officer Rakesh Asthana. We understand. "The state uses investigations, leaked evidence, chargesheets as pretexts for establishing narrative dominance and to intimidate. It is not interested in guilt or innocence. It is interested in demonstrating it can destroy your life with impunity," wrote PB Mehta. So what is the truth about farmers from Punjab who are protesting at Delhi's borders? "According to Professor Sukhpal Singh, principal economist, Punjab Agriculture University (PAU), Ludhiana, 89 percent of farmers in Punjab are under debt," wrote Anju Agnihotri Chaba. 9,300 farmers and 7,300 farm laborers committed suicide in 17 years in Punjab, 88% of which were due to heavy debt. "Iron nails, rods, barbed wire, boulders and makeshift walls are being used to barricade Delhi's borders against thousands of protesting farmers," reported BBC. "Indian tycoon Gautam Adani has added more billions to his wealth than anyone else in the world this year on the back of investor excitement around his ports-to-power plants conglomerate," reported The Hindu Business Line. According to the UN, India, at 18 million, has the largest number of citizens who have escaped abroad. So desperate are people in Punjab that there is actually a gurdwara dedicated to visas to the US. A demarche is not going to stop people in the UK or US. They have freedom of speech. Our lot can't understand.    

Other countries sucking in commodities. We pay the price.

"In recent months, global agencies and institutions have rushed to upgrade their forecasts of India's economic growth for the new fiscal year hat starts on 1 April," wrote an editorial in the Mint. The "Organisation for Economic Co-operation and Development (OECD) projected the country's gross domestic product (GDP) to expand 12.6% in 2021-22", the Indian government predicts a nominal GDP growth of 15.4% while the Reserve Bank (RBI) thinks it will be 10.5%. However, there are many uncertainties. There is the danger of a second wave of virus infections. "India, which experts say may be witnessing a second wave of the pandemic, has witnessed nearly 100,000 cases of the coronavirus disease (Covid-19) in the second week of March, data by the Union ministry of health and family welfare showed," reported Hindustan Times. "There is no clear way to contain asset inflation, and anxieties over retail price instability do not look overblown." Indian stock market indices have been at record levels recently, though they pulled back a little yesterday. "The liquidity magic isn't working on the bond markets, though," wrote Andy Mukherjee. "In India, the story is different. The entire yield curve has moved higher. This isn't a sign of optimism about growth, but a worry about rising oil prices and the hard-to-square arithmetic of next fiscal year's targeted budget deficit of 6.8% of GDP, on top of an expected 9.5% shortfall in 2020-21." Global debt investors "have pulled out more than $14 billion from India in the past 12 months even as the local equity market has had $29 billion of net inflows from overseas". In the US, investors pulled $15 billion out of bond funds in the last week. This is because investors are apprehensive about inflation as the US economy recovers and the stimulus bill passed this week will inject $1.9 trillion into the economy through higher unemployment benefits, child benefits and $160 billion for the coronavirus vaccine program, which, it is expected, will deliver a kick to economic growth. "The consensus forecasts put 2021 GDP growth at just over 5% worldwide, and near 6% in the United States," wrote Ruchir Sharma. "I think growth could top 6% worldwide and approach 8% in the United States, an astonishing pace for a developed country." "Oil has climbed 75% since the start of November", "Copper -- used in everything from cars to washing machines and wind turbines -- is trading at levels seen a decade ago. Food prices have jumped every month since May," wrote Wallace, Burton, de Sousa and Chakraborty. "Meanwhile, Goldman and some of its Wall Street rivals are talking of a new commodities 'supercycle' -- an extended period during demand drives prices well above their long-run trend." "In the auction held last week, RBI sold some 10-year debt papers at 6.22% compared with 6% in the previous auctions," wrote Gopika Gopakumar."The yield of the 10-year benchmark bond on Wednesday closed at 6.25%, up 5 basis points from its previous close of 6.2%." This maybe just the beginning as retail inflation jumped to 5.03% last month as consumer goods companies raise prices of detergents, soaps, creams, toothpaste, edible oils and tea to "offset rising costs of key raw materials". Let the milk, urine and dung of the indigenous cow be the "Foundation of Indian economy", advised Governor of Gujarat Acharya Devvrat. Brilliant. Patiala peg of Gaumutra all round.  

Poverty signifies failure. Why blame others?

"Western commentary on India - be it India's cricket pitches, management of the Covid pandemic or the farm bills - exhibit important similarities that we Indians must learn from," wrote Chief Economic Adviser (CEA) to the Government of India Krishnamurthy Subramanian. He is indignant that people are complaining about the pitch in Ahmedabad where India beat England within 2 days, whereas when India lost to New Zealand on a seaming wicket in 2002-03 it was due to poor batting. First, the highest score in this match was 145 by India which would be considered a poor score in a 20-20 match, and second, people who bought tickets for a 5-day game were cheated out of the price of the remaining 3 days. India has still not forgotten the pitch at Sabina Park in Jamaica, West Indies, in 1976 where injuries to Indian players, because of dangerous bowling by West Indies fast bowlers, forced India to end the second innings at 97 for 5, wrote Arunabha Sengupta. Sunil Gavaskar described it as "Barbarism in Kingston". Muhammad Ali's "Phantom Punch" that knocked out Sonny Liston after just 90 seconds into the first round in 1965 is still debated. Tickets at heavyweight title fights are very expensive and people want to see a good fight. New York Governor Andrew Cuomo fudged data about deaths in nursing homes due to the coronavirus "Would any American care about a tweet on this by our Bollywood stars?" It is not the fault of Americans if Delhi Police file a ridiculous FIR against teenager Greta Thuberg and make us look like idiots, and that India does not have freedom of speech. "Through the pandemic, Indian journalists, scientists and citizens have had to battle against the Indian state for access to basic data, which is often easily available in most other parts of the world, including in resource constrained Latin American countries," wrote Rukmini S. It was not foreigners that questioned the GDP back series but Indians who complained that it did not pass the smell test. Two independent members of the National Statistical Commission resigned in protest against suppression of data by this government. As for farmers' protest, Bihar abolished the state regulated wholesale markets, known as 'mandis', in 2006. In Bihar, "Farmers cannot bargain. The produce is nether graded nor auctioned as is the practice in well-functioning markets," wrote Sayantan Bera. It is more lucrative for Bihar farmers to work as farm-laborers in Punjab than to grow crops on their own farms. Subramanian has lived in the US "for a decade" so he should know that in the US, "In the last decade, income of small farms has consistently been in the red. In February 2020, the median US income from farming was a negative $1,400," wrote Bedabrata Pain. This is because President Ronald Reagan opened up the agriculture market to competition. "Farmer suicide rates are 4-5 times the national average." "Western view of the world is centered around themselves," wrote Subramanian. A survey found over 80% of Indians living in America would like to become citizens of the US, even though they have to give up Indian citizenship, and "Thirty-six percent of Indian Americans report that India is currently on the right track, while 39 percent believe it is on the wrong track," wrote Badrinathan, Kapur and Vaishnav. The per capita GDP of the US was $63,051 compared to a meager $1,877 for India in 2020. As CEA Subramanian should concentrate on making Indians rich instead of trying to cover up for the failures of his employers. The West will automatically fall in line.      

Shouldn't we decide what is good for us?

 "The extraordinary policy response by the Reserve Bank of India (RBI) to the pandemic was based on four themes," wrote Niranjan Rajadhyaksha. 1. It has poured massive amounts of liquidity by expanding its balanced sheet "by Rs 12.25 trillion in the twelve months to early March 2021", by buying government bonds through open market operations (OMO). The RBI has also been buying dollars which releases rupees into the market. 2. It has been buying long term bonds while selling short term ones, known as Operation Twist, in order to suppress borrowing costs of the government. 3. The RBI is issuing forward guidance that it will keep interest rates low, real interest rates have been at negative levels for over a year now. 4. "RBI brought in a host of temporary regulatory actions to prevent firms from failing or banks being hit by the shock. Those have ranged from an interest moratorium to allowing lenders to restructure bad loans." In an interview, Governor of RBI Shaktikanta Das said, "The benign financing conditions resulting from RBI's action in reducing interest rates and making liquidity available in abundance have been utilised by corporates to raise money and deleverage their balance sheets. There was a lot of repayment or previously availed high-cost loans." "The evergreening of loans is a well-known exercise, in which banks revive a loan on the verge of default by granting further loans to the same firm," wrote Prasanna Tantri. "The consequences of evergreening are well known: a reduction in reported defaults in the short run, followed by an eventual explosion in default rates." In 2014, when Prime Minister Narendra Modi came to power the price-to- earnings ratio of the Nifty 50 was at 23, wrote Andy Mukherjee. "The multiple is currently at 36 and climbing higher", because of "$85 billion of liquidity pumped into the banking system in less than two years". "Monday's price (of petrol) of 97.6 rupees a liter in Mumbai ($5 per gallon) was 65 percent higher than in New York." As people get financially stressed, Fitch Ratings "estimates a hole of anywhere between $15 billion to $58 billion in government-controlled banks' capital base under varying degrees of loan losses". Despite RBI's efforts at suppressing yields, global investors fear a fall in bond prices because of higher inflation and "have pulled out $14 billion from India in the past 12 months". Banks have written off Rs 1.15 trillion in the first 9 months of this financial year. "Though recent numbers show a dip, India's consumer price inflation has been well over the Monetary Policy Committee's target range of 4% plus/minus 2% for most of 2020; and the medium to long-term outlook is not bright either," wrote Mythili Bhusnurmath. "I have already said the yield curve is a public good...," said Das. But, who decides "public good"? We, the public, or a superannuated civil servant rewarded with a juicy sinecure to carry out the government's hatchet job? Europe, Scandinavian countries and Japan have negative interest rates because they are rich and have low inflation. We have poverty with high prices. In his eagerness to help the government Das should not make it worse. 

Why don't we feel wealthy when she says we are?

The steady increase n GST collections since September is a result of heightened economic activity and rising commodity prices," wrote Shreejay Sinha. "GST collections crossed the Rs 1 lakh crore-mark for the fifth month in a row in February, rising 7% to Rs 1.13 lakh crore (Rs 1.13 trillion), indicating economic recovery, the Finance Ministry said on Monday." GST collection was Rs 1.19,875 trillion in January. "The gradual recovery is a result of consumption revival, but private expenditure is missing. Consumption-led recoveries tend to be short-lived." "Finance Minister Nirmala Sitharaman on Monday said the fiscal measures taken by the government have resulted in positive growth of 0.4 percent in the third quarter of the current financial year." "Lower inflation has increased the real purchasing power of the people leaving more money in their hands to spend," she said. Indeed. "In city India, 63% of shoppers fall within the 'newly constrained' class, dealing with a decline in family incomes, or a worsening of monetary scenario, which has prompted them to observe their bills," reported News Matters. "In India, the share of 'newly constrained' is greater than the worldwide common of 46%, the NielsenIQ on-line survey discovered." "Price of domestic cooking gas, LPG has doubled to Rs 819 per cylinder in the last seven years while taxes on petrol and diesel has swelled collections by over 459 percent, Oil Minister Dharmendra Pradhan said on Monday." "According to the 2015-16 National Family and Health Survey (NHFS), only 6% of households in India owned a car or truck while the share of households owning a motorized two-wheeler is significantly higher at 38%," wrote Vineet Sachdev. "Let us say that the government gained 100 rupees each from taxes on petrol and diesel respectively. The end usage data indicate that 60% (i.e. Rs 60) of this total tax collected on petrol was paid by the two-wheeler owners while only Rs 37 was paid by the car owners. In case of diesel the data suggest that for every 100 rupees gained by taxes, Rs 13 is paid by the agricultural sector while commercial vehicles (including buses and trucks) have paid Rs 38 of total increased taxes. This is bound to get passed on to the non-rich who use these for public transport or via increased transportation cost of goods. Private car owners would have paid Rs 28.5 in taxes." "Rising fuel expenses are having a cascading effect on manufacturing costs across sectors, which is resulting in higher prices for the end consumer," reported The Times of India. Petrol and diesel are not covered by the goods and services tax (GST) which gives credit for input taxes, so any rise in prices de to increased transport costs will be taxed under GST as well, thus magnifying the rise in prices. "By January 1 this year, jet fuel prices had shot up to Rs 40,783 at Delhi's T3 and Rs 39,267 at Mumbai, and there have been multiple tax hikes thereafter as well." "The latest data available with the Ministry of Corporate Affairs (MCA) showed that a total of 10,113 companies were struck off under Section 248(2) of the Companies Act, 2013, in the current financial year till February. The Section 248(2) implies that the companies had shut their businesses voluntarily and not due to any penal action." In short, they failed. Assuming even 5 employees per company, that is at least 50,000 people unemployed. The Finance Minister maybe ecstatic that she has made every Indian very wealthy. Pity we don't feel it.               

 

Rape and marry the victim. Then it is official.

US news magazine Time has published an article titled "'I Cannot Be Intimidated. I Cannot Be Bought.' The Women Leading India's Farmers' Protests", which reports that "the Chief Justice of India (CJI) had asked lawyers to 'persuade elderly people and women to leave the protests". "In response, women farmers -- mostly from the rural states of Punjab, Haryana and Uttar Pradesh -- scrambled onto stages, took hold of microphones and roared back a unanimous 'No!', the story by Nilanjana Bhowmick reads." Supporters of the government are spreading all kinds of canards about the farmers' protest just as they did with the protest against the Citizenship (Amendment) Act (CAA)  by Muslim women at Shaheen Bagh in Delhi. "Thousands of women protesters, some of them driving the tractors themselves, headed for Delhi from various districts of Punjab and Haryana to reach the national capital for a congregation at Delhi border protest sites to mark International Women's Day on Monday," reported India Today. The Chief Justice wants to protect women. A man accused of raping a minor "sought protection from arrest saying that as he is a government employee, he will be suspended automatically if he is arrested". "Will you marry her?" CJI Bobde reportedly asked the accused man." "If you want to marry, we can help you. If not, you lose your job and go to jail. You seduced the girl, raped her." Consensual sex with an underage girl is rape because her consent is considered invalid in law. Women are naturally furious as they rightly feel that judges in lower courts will be guided by the CJI's reasoning and put young girls in danger. "A court in India has granted bail to Nodeep Kaur, a 25-year-old labour rights activist who has been in prison for more than a month," reported BBC. "Her arrest led to global outrage given the circumstances in which she was picked up amid accusations of sexual assault and torture." Then there was the hounding of woman actor Rhea Chakraborty by various government agencies following suicide by a male actor. Now the Narcotics Control Bureau (NCB) has filed a 12,000 page charge sheet alleging drug dealing against the lady. Dubai Princess Latifa was abducted from a boat in international waters by Indian special forces, tranquilised and put on a plane back to Dubai despite having committed no crime and asking for asylum in India. The human sacrifice apparently paid political dividends as India got Christian Michel in exchange and the friendship of the UAE. If actors and princesses are treated as dispensable, what about Dalit women? "On the last day of September, India woke up to the disturbing news that authorities had forcibly cremated the body of a 19-year-old Dalit (formerly untouchable) woman who had alleged gang rape and died a day earlier," reported BBC. "The police formed a human chain to keep the villagers and journalists from getting close." "There appear to be bruises on her neck, face and hand, and she seems to be in tremendous pain." "Since her death the state government has insisted that she was not raped at all." This was done to protect the rapists. Are they even human? "Dalit women across swathes of rural India have been victims of sexual violence for as long as anyone can remember," wrote Soutik Biswas. "Ten Dalit women were raped every day in India last year, according to official figures." Happy International Women's Day. They need to be indomitable. In India.   

Football clubs are going bankrupt. A warning?

In an effort to lie out of its responsibility, China has been blaming every other country, including India and the US, for the origin of the coronavirus pandemic which has affected over 117 million people and killed over 2.6 million worldwide. China was incensed when Australia asked for an independent investigation into the origin of the virus and suddenly discovered massive virus contamination in frozen meat imports from Australia and New Zealand. Then, to punish Australia for its audacity in questioning its barefaced lies, China imposed restrictions on imports from Australia as economic punishment. "Chinese investment in Australia plummeted 61% in 2020, the lowest number in six years," reported BBC. Try as it might, China cannot fully suppress brave truthtellers who have risked their lives to expose its lies, reported CNN. "Many have paid a heavy price for their work. Some have been detained. Others are missing. One even died as he tried to bring the full story to light." "Eight months after the savage Galwan valley clash, China finally admitted that 4 People's Liberation Army (PLA) soldiers had been killed in the hand-to-hand fighting that resulted in the death of 20 Indian soldiers." This is also an attempt at cover up because "Russian news agency, TASS has reported that 45 Chinese soldiers died in the free-style fight". "The Russian news agency's report is consistent with some other media reports of the time which had quoted some intelligence sources including those from the US." The uncivilized barbarians do not care that the families of the PLA soldiers "were outraged by the fact that unlike Indian soldiers, their martyrs had received no honor and no acknowledgement". Investigative journalist Qiu Ziming and three bloggers were arrested for questioning the government's version of the number of Chinese soldiers killed. Qiu, who has "more than 2.5 million followers on the Twitter-like platform Weibo under the pseudonym 'Crayon Ball'" has been charged with "defaming martyrs", reported Economic Times. "Traditionally, every March the National People's Congress (NPC) and the Chinese People's Political Consultative Conference (CPPCC) gather for a dual meeting to pass or endorse legislation, known colloquially as the Two Sessions," reported CNN. "But this year the Two Sessions will also discuss a vision for China's development by 2035, an unusually long-sighted plan for which the details are unknown. The long-term plan could indicate the length of time that Xi sees himself staying in power, said Bill Bishop, China politics expert and author of Sinocism newsletter." However, the economy is everything. Xi Jinping has declared "complete victory" in the effort to eradicate rural poverty, reported Reuters. At the same time, Jiangsu FC football club was shut down by its owner Suning Holdings Group because it cannot afford the expense. Other football clubs are also in trouble as the companies owning them are in financial trouble. If the economy flounders Xi Jinping's enemies could unite against him. It would be a treat to see Xi in Mao Pajamas.   

How long will the bond market tolerate losses?

"Across the world, stock markets partied as the deadly virus spread in 2020, but there are at least three reasons to expect the revelry to end," wrote Ruchir Sharma. Central banks and governments have poured record amounts of monetary and fiscal stimulus. The balance sheet of the US Federal Reserve has climbed over $7.5 trillion. "Since late 2008, central banks have cut interest rates, and printed and pumped huge amounts of money into the global financial system," and "governments have borrowed more and upped their expenditure to pump prime economic growth," wrote Vivek Kaul. All this excess money has created asset price bubbles across the world. The US government spent $2 trillion on a stimulus package to support people who lost their jobs and a lot of people invested in stocks as they sat at home. "Nearly 20% of the dollars in circulation were printed in 2020," wrote Sharma. "The consensus forecasts put 2021 GDP growth at just over 5% worldwide, and near 6% in the United States. I think growth could top 6% worldwide and approach 8% in the United States..." "The belief is that supply will not be able to keep up with the increasing demand and this will lead to more money chasing the same set of goods and services -- in the process, pushing up prices or leading to higher inflation," wrote Kaul. Sharma agrees and thinks "a sharp rate rise could deliver a disproportionately large shock" to financial markets. "Warren Buffett has called the future of bond investors bleak in his recent annual letter to investors," wrote Aparna Iyer. He means that as inflation rises, bond prices will fall as people demand higher yields. "The 10-year US Treasury yield jumped Friday after the February jobs report topped expectations, sending the benchmark yield to its highest level this year, before retreating as the day wore on," reported CNBC. "Treasury Secretary Janet Yellen played down any concern that the recent surge in US government-bond yields reflects expectations for an outsized breakout in inflation," reported the Mint. "While Buffett sounds downbeat, Shaktikanta Das, India's central bank governor, is optimistic." He has been "trying every possible trick to keep yields from rising," but, "India stands to lose more given that inflation here is higher compared with most other emerging market peers." Oil prices jumped yesterday to their highest levels in 14 months "after OPEC and its allies agreed not to increase supply in April as they await a more substantial recovery in demand amid the coronavirus pandemic". As the third largest oil importer in the world, the Indian government warned that it would undermine consumption led recovery. Prices of food and fast moving consumer goods (FMCG) are bound to go up because of higher input costs, said Madan Sabnavis. Already, prices of manufactured goods are being increased to balance costs of transport. The government is celebrating collection of Rs 1.04 billion every day through toll collections on cars and trucks. Despite a near complete cessation of business activities due to the coronavirus lockdown the government is on course to collect the same amount of GST as in 2019-20. This can only be because of high prices or high tax rates. Which add to prices. Inflation is inevitable. The government wants to extract as much taxes as possible and for prices to stay very low so that RBI can keep borrowing costs at basement levels. An impossible trinity.

True figures will out.

"Petrol price can go down to Rs 75 a liter across the country if brought under the ambit of the Goods and Services Tax (GST) but there is a lack of political will, which is keeping Indian oil product prices at one of the highest in the world, economists at SBI (State Bank of India) said on Thursday." Revenue loss for combined Center and states will be Rs 1 trillion, which is only 0.4% of GDP. Price of petrol is Rs 91.17 per liter in Delhi and Rs 97.57 in Mumbai. "A present, states choose to levy a combination of ad velorem tax, cess, extra VAT/surcharge based on their needs..." Why are states loath to agree to GST on fuel? Because, state governments, especially those run by opposition parties, do not trust the central government. Last year, the Center refused to pay compensation for a shortfall in GST collections and asked states to borrow money to meet their budget needs. Finance Minister Nirmala Sitharaman attacked opposition parties in Parliament for not accepting her excuse that this was 'force majeure' or 'act of God'. She conveniently forgot that force majeure applies to companies which cannot pay creditors because of some natural calamity and not to the central government which can print money. However, this is not the only way that this government has shortchanged the states. States are supposed to get 41% of all taxes collected by the Center according to the Finance Commission set up to advise revenue distribution according to population and economic development of individual states. However, the Center blatantly cheats states of their share of taxes by collecting 19.9% of revenue through cess and surcharges which are not shared with the states. How do you calculate your share of anything if government figures are suspect? The government's calculation of GDP back series has been questioned for using a fictitious database. Two external members of the National Statistical Commission resigned because the government suppressed true figures regarding employment and GDP. "Throughout the pandemic, Indian journalists, scientists and citizens have had to battle against the Indian state for access to basic data, which is often easily available in most other parts of the world, including in resource constrained Latin American countries," wrote Rukmini S. Prof Renuka Sane and Ajay Shah used data from "the Center of Monitoring Indian Economy (CMIE)'s Consumer Pyramids Household Survey, which talks to over 200,000 households three times a year, seeking details about the whereabouts of each family member. The survey does not ask about cause of death." "Their estimates show that deaths from all causes almost doubled between May and August compared to the same period for past years." When an American company Recorded Future disclosed that Chinese state-sponsored hackers had shut down Mumbai's power supply last October, a minister immediately said it was 'human error' and not cyber attack. It was worse than just Mumbai. Pesky Americans have now identified the Chinese hacker group as RedEcho which attacked power plants in Delhi and Karnataka, in addition to Mumbai, as well as ports in Tamil Nadu and Mumbai. Unfortunately, Americans cannot be beaten and locked up indefinitely for sedition. Dang furriners.     

Why so complacent about high prices?

"Since late 2008, central banks have cut interest rates, and printed and pumped a huge amount of money into the global financial system, in order to keep interest rates low in the hope of driving economic growth. At the same time governments have borrowed more and upped their expenditure to pump prime economic growth," wrote Vivek Kaul. "The Covid pandemic has added $24 trillion to the global debt mountain over the last year a new study has shown, leaving it at a record $281 trillion and the worldwide debt-to-GDP ratio at over 355%," reported Reuters. "South Africa and India recorded the largest increases just in terms of government debt ratios." "All this money sloshing around has led to multiple financial and real estate bubbles across the world, something that central banks have stayed away from pricking." The price to earnings (PE) ratio of the Dow Jones Industrial Average stood at 31.47 on 26 February. "It was at 19.75, a year earlier." The Indian stock market Nifty 50 PE ratio stood at 40.71 yesterday. "The bull-run in global stocks fuelled by cheap cash and reflation hopes will continue for at least another six months but a rise in bond yields as inflation expectations grow could throw a spanner in the works, Reuters polls found." "The US recovery is accelerating, putting it on course to outperform China's V-shaped rebound, according to JP Morgan Chase & Co economists," reported the Economic Times. The House of Representatives passed a $1.9 trillion stimulus bill which aims to pay $1,400 to every American earning less than $75,000 per year, reported CNN. The bill has yet to clear the Senate but cash in hand would immediately stimulate spending and may cause an increase in prices. US Federal Reserve Chair Jerome Powell said in August last year that the Fed will target an average inflation of 2%, meaning that it will tolerate an inflation rate higher than 2%  to balance this period of low inflation. The consumer price index in January in the US was 0.3%. Yesterday, "Benchmark 10-year US Treasuries (yields) rose to 1.477 percent as investors bet US inflation could pick up as economic recovery gathers steam, driven by government stimulus and further progress in vaccination programs." "A rise in nominal bond yields in the euro zone would be welcome if it is accompanied by higher inflation expectations, showing that the European Central Bank's anti-pandemic stimulus is working, ECB policymaker Isabel Schnabel said," reported Reuters. Why do all these economic data in the US and Europe matter to us in India? Because inflation is always high in India. Retail inflation was 4.1% in January, lowest in 16 months. Rising prices means that the rupee buys less. Sky rocketing petrol and diesel prices will feed into prices of everything including food and that will fuel inflation. At some point the rupee has to adjust against the dollar and a weaker rupee will increase cost of imports, including oil. That's when inflation will jump, markets will tank and growth will collapse. How long will verbal stimulus work?  

What if foreigners see Indians as victims, and not as criminals?

"The Indian government has come up with a new set of rules and regulations to regulate social media platforms, messaging services, OTT platforms and news portals," reported the Business Insider. "A key provision specific to messaging services is the requirement to identify the originator in case of mischief." This is nothing new. The previous Congress-led government forced Blackberry, a business to business service, to hand over its source codes so that they could snoop on citizens. How else would politicians and civil servants maintain total power without any accountability? Ominously, "All significant social media intermediaries are required to appoint a chief compliance officer, a nodal contact person and a resident grievance officer. Each of the above are required to be Indian residents." Thus, Disha Ravi could be forcefully locked up by Delhi Police whose evidence was rubbished by a courageous judge as "more of ornamental in nature". Laughably, Delhi Police filed a first information report (FIR) against Swedish activist Greta Thunberg and UP Police booked CEO of Alphabet, which is parent company of Google, Sundar Pichai, who is of Indian origin, but dropped charges, perhaps realising that he is too big to be abducted from the US, like Ravi was. Indian citizens are fair game, like Nodeep Kaur, who has not been sexually assaulted or tortured said Haryana Police, reported the BBC. However, 5 doctors examined her co-accused Shiv Kumar and "listed seven injuries, of which two were termed 'grievous' caused by a 'blunt object'". Who should we believe?  WhatsApp, owned by Facebook, has said that it will not end its end-to-end encryption but the government says that it should be possible to trace the original author of a message despite encryption. Of course, the police could do it by seizing the phone of anyone they arrest, which they do anyway, tracing the number from where it was forwarded all the way back to the source, but it will take too long. Instead, companies have been told to find the origin within 72 hours. At their own cost. End-to-end encryption is through Signal protocol (E2EE) which prevents traceability, wrote Anand Venkatanarayanan. So governments use a propaganda technique called Pedophrasty, "where children are invoked to prop up an argument and make opponents against the argument look like unprincipled savages and make everyone else suspend all rational and critical thinking, and agree to the argument". Backdoors are dangerous. "In 2010, Google published a blog post, detailing how Chinese state backed hackers, attacked Gmail to spy on Chinese human rights advocates via a backdoor, installed by Google at the behest of the US government to comply with search warrants on users." Will social media companies surrender to the Indian government. Why not? Why should they care if Indians get beaten up if they are making money? Google had a secret project to offer a censored search engine in China and Facebook CEO Mark Zuckerberg repeatedly visited China for permission to launch a censored version of Facebook. "The overwhelming tone and nature of the international media's coverage of contentious domestic political issues reinforce a narrative that India is turning back on its democratic, secular, pluralist roots and its open and free society is no longer as open and as free," wrote Chanakya. Xi Jinping may not care but Prime Minister Narendra Modi enjoys hobnobbing with foreign leaders. If India is seen as a fascist police state, invitations may not be as freely forthcoming. Just when 2 brand new super luxury aircraft have arrived. With encryption facilities.   

Will soothing words hide our pain?

India's economic activity is gathering momentum, the Reserve Bank (RBI) said yesterday, reported Business Today. "All engines of aggregate demand are starting to fire; only private investment is missing in action and the time is apposite for it to come alive." Doesn't make sense. If demand is increasing according to the RBI, some 120 companies reported more than 100% rise in their profits in the December quarter and the RBI is holding borrowing costs at record low rate of 4%, then why are businesses so reluctant to invest? "The RBI expects the Indian economy to grow by 10.5 percent in the financial year 2021-22." Udit Misra analysed the First Advance Estimates (FAE) for the current financial year ending on 31 March, released by the Ministry of Statistics and Programme Implementation. It said that the GDP will contract by 7.7% this year, per capita GDP will fall below 2016-17 level, per capita private final consumption expenditure (PFCE) will fall below 2017-18 level and gross fixed capital formation (GFCF), which indicates private investment, will fall even below 2016-17. Unemployment level was rising "even with India's growing economy, albeit at a decelerating pace, before the Covid crisis" and has risen over the last 12 months "then the total number of unemployed people must be around 40-45 million", wrote Misra. "It must also be kept in mind that each unemployed person is part of a larger family -- implying millions of families suffering from the lack of employment opportunities." "A Mint assessment of nearly 2,500 listed companies has revealed that their net profit in the third quarter of 2020-21 (October to December) expanded by 72%, year-on-year," wrote an editorial in the Mint. How? "As the virus raged, businesses rushed to retrench staff, slash salaries, shave office expenses and enhance operational efficiency, among other things." Coronavirus infections have increased in parts of the country again. "Maharashtra and Kerala appear to be witnessing a second wave of the virus with experts expressing apprehension that a similar rise is bound to happen in other parts of the country as well," reported the Times of India. "An international comparison of growth rates shows that India will be among the worst affected economies by Covid-19, suffering the 8th largest contraction among the 30 countries for which IMF's World Economic Outlook has given GDP growth rates," wrote Roshan Kishore. "The RBI is projecting inflation at 5% or a little north  of 5% till September. Net-net, the RBI is calling for much lower inflation in 2021 than in 2020," wrote Joydeep Sen. This is because of lower food prices and base effect. Food prices maybe low for now but prices of other goods and services are rising because of rising fuel costs. The RBI is trying to be soothing. How long can it hide the pain?