It's in the eyes of the beholder.

"A 58 million increase in jobs between calendar year 2019 and calendar year 2022. Jobs for women increased by 28 million or by 25% over 2019 level; jobs for men increased by 30 million,...or 8.4%," wrote Surjit S Bhalla & Tirthatanmoy Das. These figures are from the Periodic Labour Force Survey (PLFS) Annual Report (July 2021-June 2022) by the National Sample Survey Office (NSSO), released by the Ministry of Statistics and Programme Implementation (MOSPI). The survey reports its results in percentages so Bhalla & Das have probably calculated the absolute numbers they provide. The report provides three ratios: the Labor Force Participation Rate (LFPR), which is the percentage of people working or looking for work, the Worker Population Ratio (WPR), which is the percentage actually working, and the Unemployment Rate (UR). On each of these parameters there is a difference of about 1-2% between 2019-20 and 2021-22. For example, the LFPR for rural women has gone up from 33.0 to 36.6% and WPR from 32.2 to 35.8%, but the LFPR for urban women went up from 23.2 to 23.8% and WPR from 21.3 to 21.9% (less than 1%). The increase in low paying agricultural jobs is not good. "The agricultural sector witnessed a return of 36 million workers between 2017-18 and 2021-22. So pronounced was it that the absolute count of workers in agriculture stood higher in 2021-22 than in 2011-12, a decade ago," wrote Prof Himanshu. If a total of 58 million Indians have found paid employment, consumer spending should be shooting skywards. "Online and offline sales during the Hindu festival period starting in the last week of September and lasting until early November are estimated to cross $27 billion, almost double the amount in the same pre-Covid period in 2019, and nearly 25% higher than last year, according to industry estimates." ET. But, "Consumer perception of the general economic condition continues to be pessimistic as per the Reserve Bank of India's Consumer Confidence Survey of January 2023, where more than 50% of consumers reported it to have worsened." ET. Hence consumer demand is expected to stay low over the coming quarters." And, "Listed manufacturing companies recorded lower sales growth of 10.6 percent in December quarter of the current fiscal compared to 20.9 percent in the previous quarter, according to data released by the RBI. The moderation in manufacturing companies was broad-based across the industries, except for cement." ET. Not much evidence of festival boost. "Indians purchased an estimated 2.6 billion pairs of footwear in 2019-20," "But in the ongoing financial year (2022-23), sales of low-priced open footwear have stuttered. Relaxo Footwears, a leading mass market brand, reported an 8% drop in sales volumes and revenues in the third quarter (October-December)," wrote Sayantan Bera. So, why are Bhalla & Das so excited? Because, according to NSSO data, between 2004-05 and 2011-12, employment increased by just 13.3 million which is a compound annual growth rate of 0.4%. This was before Mr Modi became prime minister for the first time in 2019, wikipedia. Mr Modi the Messiah, Mr Bhalla the acolyte. Amen.

What's in a name.

Congress Leader Rahul Gandhi criticised the government of Prime Minister Narendra Modi in a speech at Cambridge University in the UK. HT. "In my view, Mr Narendra Modi is destroying the architecture of India. I am not bothered about the two-three good things he is doing if he is blowing our country to smithereens. And I think that's what he is doing," he said. He has every right to object if he thinks the prime minister is wrong because it affects us all, but we cannot speak out for fear of being arrested under false charges. One of the agencies, "The Enforcement Directorate (ED) has said that only 2.98 percent of its overall ECIRs or complaints have been filed against serving or former MPs and MLAs even as its conviction rate under the anti-money laundering law is at a high of 96 percent." ET. That only a minuscule number of cases have been filed against politicians is not the point, what is important is how many, if any, members of the BJP have been charged. If not, why not? As for the claim of 96% conviction rate, "Since 2005, the ED, one of the premier investigating agencies in India handling economic offences, has registered 5,906 cases. Of them, the agency has managed to dispose only of 25 cases, a mere 0.42% of the total cases." The Wire. This, surely, has to be a classic example of 'terminological inexactitude' (wikipedia). The BJP instantly mounted a ferocious attack on Rahul Gandhi, TOI, with members competing to show their loyalty to their Messiah Mr Modi. Union Minister Hardeep Singh Puri called Mr Gandhi an "ass", The Print. Why is it alright to abuse Gandhi in vulgar language? Then there is the fairy tale of Mr Gautam Adani, once the second richest man in the world with a net worth of $156.3 billion, according to the Forbes list. HT. "Gautam Adani's elder brother, Vinod Adani, has been described by the media as 'an elusive figure'," said the Hindenburg report. "We have identified 38 Mauritius shell entities controlled by Vinod Adani or close associates. We have identified entities that are surreptitiously controlled by Vinod Adani in Cyprus, the UAE, Singapore, and several Caribbean Islands." A very serious charge of money laundering, to which an Adani group spokesperson said, "Vinod Adani does not hold any managerial position in any Adani listed entities or their subsidiaries and has no role in their day-to-day affairs." TOI. But, having categorically denied any association, "Vinod Adani, the elder brother of Adani group founder Gautam Adani, is part of the Adani promoter group, the group's flagship Adani Enterprises said." TIE. The ED should be galloping to investigate Adani's web of companies, seizing their accounts, arresting various officials and questioning them for hours, as they are doing to Delhi Deputy Chief Minister Manish Sisodia of the AAP party. ET. Mr Sisodia is apparently charged for an Excise policy scam in which alcohol was being sold at cheap rates in Delhi. How selling something cheaper can be a scam escapes us, but is clear to ED. Hence, "Modani has entered India's political lexicon," wrote Yogendra Yadav. "Clubbing Modi and Adani in the same word is a brilliant rhetorical device to establish the proximity that both of them evidently enjoy." The Messiah may have feet of clay, after all. That's why the obscene cacophony by sycophants.     

Banks once again.

The US Federal Reserve's Federal Open Market Committee (FOMC) is to meet tomorrow and day after to decide on whether to increase its Funds Rate and by how much. "Even with turmoil in the banking industry and uncertainty ahead, the Federal Reserve likely will approve a quarter-percentage-point interest rate increase..., according to market pricing and many Wall Street experts." CNBC. Great uncertainty was created by Fed chair Jerome Powell in his testimony to Congress earlier this month, when he said, "The latest economic data have come in stronger than expected," and so, "If the totality of data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes." CNN. Then the Silicon Valley Bank failed because it had parked excess funds in long dated US Treasuries which dropped in value as interest rates have risen, causing mark to market losses, and resulting in a run on the bank. TOI. Two days later, the New York-based Signature bank collapsed and was taken over by the Federal Deposit Insurance Corporation (FDIC) which had rescued SVB as well. Reuters. On 16 March, the biggest US banks, including JP Morgan Chase, Citigroup, Bank of America, Wells Fargo, Goldman Sachs and Morgan Stanley, put together a $30 billion rescue package for the First Republic Bank. ET. Yesterday, "Troubled bank Credit Suisse has been rescued by its Swiss rival UBS in a government-backed deal." BBC. "Credit Suisse shareholders were deprived of a vote and will receive one share of UBS for every 22.48 shares they own, valuing the bank at $3.15bn." "Soon after the announcement late on Sunday (yesterday), the US Federal Reserve, European Central Bank and other major central banks came out with statements to reassure markets that have been walloped by a banking crisis that started with the collapse of two regional US banks earlier this month." Reuters. Despite all this mayhem, "Policymakers at the European Central Bank (ECB) announced on Thursday (16 March) that they would go through with a planned 0.5% interest rate hike as the institution juggles both inflation and financial uncertainty amid turmoil that has gripped financial markets." DW. This is because prices increased at 8.5% in February in the 20-member euro zone countries. "Headline inflation stood as high as 10.6% in October, but reached a revised 8.6% in January." CNBC. The ECB has got itself into this mess because it had a negative interest rate for 8 years and raised it to 0% from minus 0.5% only in July 2022. DW. There was the ridiculous situation of Denmark's Jyske Bank "offering home buyers 10-year mortgages at an interest rate of -0.5%. That means borrowers over a decade will pay back less than the amount borrowed, not including one-time fees." Washington Post. That is because Denmark became the first country to impose negative interest rates, which meant savers had to pay for keeping money in banks. Reuters. This was to recover from the Great Recession caused by the collapse of Lehman Brothers due to the US 2007-08 subprime crisis (Investopedia). Seems that the treatment is creating the same problem. Too much of a good thing.

Dangers of increasing wealth.

"Inflation concerns do not warrant any additional interest rate increases, Bibek Debroy, chairperson of the Economic Advisory Council to the Prime Minister (EAC-PM), said, adding that businesses are contending with high interest rates due to the inefficiencies of the banking sector, resulting in a wide gap between borrowing and deposit rates." Mint. Twin balance sheet problem of banks have been sorted, "Non-performing assets are not what they used to be," "there has been empowerment in rural areas", which should increase consumption, and government has increased capital spending "in a big way". In January, Debroy predicted that "India's GDP will be close to USD 20 trillion by 2047 and per capita income may reach USD 10,000 (at current value of USD)." ET. "With prices on a steady rise across the world over the past few years, there may be a need to rethink long-term inflation targets, Monetary Policy Committee (MPC) member Ashima Goyal said at a CII event." ET. "Goyal also said that the distribution of weights in the inflation basket needs to be revised, joining others seeking urgent changes to the way the nation collects and uses data." Globally, interest rates remained low and stable for 25 years, wrote Surjit S Bhalla. "Until a series of supply shocks starting with Covid in 2020 and continuing with the Russian misadventure in Ukraine." Higher interest rates will not increase supplies. Hence, the "US Fed needs to answer as to how and why its policy of confronting supply shocks is any different than the failed RBI policy of many decades of raising rates as a response to droughts and consequent food inflation." Sounds very reasonable. "Food and beverages constitute 45.9% of the CPI (consumer price index) basket and within that, the consumer food price index (CFPI) constitutes 39.06%. This is in contrast to many advanced economies where food weights are much lower, for instance, UK (9.3%), US (13.2%), Canada (15.94%) and Germany (8.5%)," noted a report by Indian Council for Research on International Economic Relations." TOI. But then, Indians spend more on food. "The average Indian household will spend 35.3 percent of total household budget on food in 2025, increasing by 2.1 percentage points from 33.2 percent in 2005, Fitch Solutions said." The Print. Whereas, "In 2021, US consumers spent an average of 10.3 percent of their disposable income on food." ers.usda.gov. India's population is already over 1.4 billion and is expected to peak at 1.7 billion in 2064. Pew Research. And, "Food supply in India and across the globe will go down by at least 6 percent by 2050 as water crisis and heat stress caused by climate change will hit productivity, the Global Commission on Economics of Water (GCEW) has warned." DH. India will be a developed country in per capita income measured by purchasing power parity (PPP) by 2047, predicted Bhalla. TOI. A larger population with higher per capita income and falling production, what is Bhalla's predicted rate of inflation? At present RBI's mandate is to target CPI inflation rate of 4%, +/- 2%, that is 2-6%. ET. Debroy wants RBI to freeze. Prof Goyal recommends a higher target. How much? 10%, 20%, 100%? Pakistan's inflation rate has hit 45.64%. ANI. Do Debroy, Bhalla and Goyal want to emulate Pakistan? Or, perhaps, Argentina where it zoomed to 102.5% in February. They are eminent economists. All.  

Unfriendly incentives.

"There is no skilled talent available to handle chip manufacturing plants in India, and there will be a requirement of 10,000-13,000 human resources to meet industry requirements by 2027, a Meity (Ministry of Electronics and Information Technology) official said..., citing an internal report." ET. In April 2022, "Prime Minister Narendra Modi...urged industry to make India a global hub for semiconductors, asserting that the government had 'put the odds in your favor as far as possible through supportive policy environment'." BS. "Multinational companies and long term foreign investors like private equity giant Blackstone have their sights on India," wrote Anjani Trivedi. And yet, "For most firms, big projects that are tendered out end up relying on overseas entities because many of the products and supplies aren't available domestically or in some cases, don't meet global standards." "For new companies entering now, the runway is far longer. Despite the so-called production-linked incentives, the threshold for sales and upfront capital is too high for medium-sized businesses to actually take advantage of subsidies." Earlier this month, "Taiwanese tech giant Foxconn confirmed...that its chairman had visited India, but denied it had 'entered into any binding, definitive agreements' after reports saying it was planning new investments in the country." ET. "China's decision to open its market to the foreign investment has helped the country to become a global superpower, said renowned author and China expert Michael Pillsbury." BT. "For instance, China built infrastructure for companies that wanted to sell smartphones in their country, made them tax-free for 10 years, added Pillsbury. China unleashed this strategy in almost every sector and it succeeded. In comparison to China, India is not very friendly to foreign investment." India is unfriendly not just for foreign companies, but for domestic ones as well. "Regulatory Technology (Regtech) solutions company Teamlease Regtech...released its report titled 'Simplifying Compliance Management for The Logistics and Supply Chain Industry'." ET. It revealed that, "Companies operating in a single state with just one warehouse and a corporate office are required to comply with 648 regulations." And, "In a staggering revelation, around 91% of surveyed logistics and supply-chain companies agreed that they have paid fines and penalties in the last twelve-month period." "Paper in the form of files, circulars, government orders are at the heart of India's bureaucratic tradition. Its roots trace back to the colonial origins of the modern Indian state," wrote Yamini Aiyar. Naturally," They command, they mandate, they threaten, they order officers to get the job done." They, in turn, treat us hapless citizens, the same way. And so, "India's government will not permit social media platforms to host any information that it identifies as false, according to a draft proposal of the country's IT rules." Reuters. Which will give them sole rights say whatever. Even pants on fire stuff. 

Vostro means yours, not ours.

In January, the Governor of the Reserve Bank of India (RBI), Shaktikanta Das said, "Crypto is a form of gambling without any underlying value and is nothing but a 100 percent speculation world." And so "crypto should be banned, given its no underlying value in the market". Investors may disagree. They may see it as a store of wealth given that high inflation and negative real interest rate in India mean that the rupee is sure to drop in value against other major currencies. "US-led international sanctions on Russia have begun to erode the dollar's decades-old dominance of international oil trade as most deals with India - Russia's top outlet for seaborne crude - have been settled in other currencies." Reuters. Are we paying in rupees? Not really, as "Indian customers have paid for most Russian oil in non-dollar currencies, including United Arab Emirates dirham and more recently the Russian rouble, multiple oil trading and banking sources said." "In what is clearly an indication of India's rising prominence on the global stage, the Indian Rupee (INR) has now been accepted by 18 countries from across the globe for transactions." TN. "According to the details shared by the government, the full list of countries that accept payments in INR include - Botswana, Fiji, Germany, Guyana, Israel, Kenya, Malaysia, Mauritius, Myanmar, New Zealand, Oman, Russia, Seychelles, Sri Lanka, Singapore, Tanzania, Uganda and the United Kingdom." Does this mean that the rupee is now a free and international currency? Not really. Capital account convertibility "is the ease with which a country's currency can be converted into gold or another currency through global exchanges." Investopedia. In October 2021, RBI Deputy Governor T Rabi Sankar said that, "India is on the verge of achieving its long standing target of capital account convertibility." NDTV. The fear is that, "When we embrace full convertibility, as canvassed by the RBI deputy governor, anyone can do pretty much what she pleases," wrote S Murlidharan. "The worry could be that Indian residents might dump the INR in favor of the greenback." So, how are countries like the United Kingdom and Germany accepting payments in Indian rupees? And why only 18 countries if the rupee is free to trade? Actually, "Several banks, including HDFC Bank and UCO Bank, have opened as many as 30 special vostro (meaning yours) accounts as of date to facilitate overseas trade in the rupee, a top government official said." BS. To simplify the jargon, vostro accounts are special arrangements between Indian banks and banks in these 18 countries in which Indian companies pay for imports in INR which are then converted to the receiving country's currency at market rates and India exporters receive payment in INR through that account. TOI. In effect, it bypasses the dollar, thus reducing the effect of sanctions, preserves foreign currency reserves and saves on costs of currency exchanges. As for gambling, there are two casinos in Sikkim and ten in Goa. wikipedia. And there are no laws against online gambling in India. India Legal. Perhaps, Governor Das is not worried about Indians losing money through gambling. Perhaps, he is worried about Indians converting their rupees into dollars through cryptocurrencies. Which will reduce his control of the exchange rate. Why dissemble?    

Women in the lead.

"Amid a spate of attacks on Hindu temples in Australia, Prime Minister Narendra Modi strongly raised the issue with his visiting counterpart Anthony Albanese saying that such attacks are disturbing and had naturally caused anxiety in India." TOI. "Albanese assured him that the safety of the Indian community was a special priority for his government." Wonder if Albanese asked Mr Modi about late visa for one particular Australian cricket player. In February, "Australian opener Usman Khwaja was granted the visa late on Wednesday to travel to India for the test series after the Pakistan-born cricketer was forced to miss the morning flight due to delay in the issuance of travel documents." HT. Pretty bland. But not in Australia. "Cricket columnist Malcolm Conn of the Sydney Morning Herald has brought out the rich irony of Usman Khawaja's brilliant century on day one of the fourth Test match...which started after the well-choreographed chariot ride around the stadium by PM Narendra Modi, accompanied by his Australian counterpart." The Wire. For those, who have never seen a chariot in the age of the motor car, these pictures from the movie 'Ben Hur' will clarify. google. It's not just a Pakistan-born foreigner, however, India has lots of people who do not practice, or believe in, Hinduism. But, as citizens, they have the right to vote. And, elections bring power. So, "Narendra Modi sat poker-faced as the choir sang Hallelujah, a popular Christian hymn extolling Jesus as the 'King of kings and Lord of lords' during the swearing-in ceremony of the new NDPP-BJP coalition government in Kohima, Nagaland." DH. Modi is already our emperor. Far away in the US, "Seattle has become the first US city to ban discrimination based on caste after a vote by the city council." BBC. Because of Councilwoman Kahama Sawant. "The caste system in India dates back over 3,000 years and divides Hindu society into rigid hierarchical groups." The media in India will not dare to report that, "Washington: After a recent screening of a BBC documentary, India: The Modi Question, panellists urged the US media to hold Indian Prime Minister Narendra Modi accountable for the 2002 massacre in Gujarat." Pakistan newspaper Dawn. "Aakashi Bhatt, daughter of jailed whistleblower (Sanjiv) Bhatt, told the participants that many of India's institutions, including the media and judiciary, 'are subverted from top to bottom' and 'used by the regime to do its dirty work'." "A video has gone viral on social media where several posters, claiming that women and minorities are treated like slaves in India among other hateful things, were seen outside the United Nations building in Switzerland's Geneva." News18. "One of the posters read , 'Indian Christians face state-sponsored terrorism'." Not just Christians. "A Muslim man in Bihar's Siwan district died...at a hospital after a mob brutally thrashed him on the suspicion that he was carrying beef." NDTV. "In an interview where she reveals the disquieting state of journalism in Kashmir, and the disturbing treatment of Kashmiri journalists by the government, Anuradha Bhasin, the executive editor of the Kashmir Times, refuted minster of Information and Broadcasting Anurag Thakur's criticism of her recent essay in the New York Times," wrote Karan Thapar. Modi has immunity as the head of state, said a US spokesperson. TN. That does not apply to his underlings. If western countries start denying them visas for their taxpayer-funded jaunts overseas, the rats might start fleeing the ship. That's when the dung will hit the fan. Holy Cow.        

Law of percentages.

"India's retail inflation declined marginally to 6.44 percent year-on-year in February as against 6.52 percent in January, data released by the Ministry of Statistics and Programme Implementation (MoSPI) showed." ET. "The high inflation level can be attributed to rising food prices, which account for nearly 40 percent of the Consumer Price Index (CPI) basket." "India's wholesale price index (WPI)-based inflation eased to 3.85 percent in February on an annual basis from 4.73 percent in January, stated provisional data from the Commerce Ministry." ET. The WPI inflation was at 13.11% in February 2022, TIE, so the drop this year is largely due to base effect. "In its February meeting, the Monetary Policy Committee (MPC) of the RBI projected annual inflation for 2022-23 at 6.5%," but "The Centre for Monitoring Indian Economy (CMIE) that cumulative annual inflation between April 2022 to February 2023 stands at 6.97% right now," PressReader. Also, core inflation, which excludes food and fuel, has been around 6% for a very long time and came in at 6.22% in February. "A year-on-year comparison shows that the inflation adjusted profits (net) of non-financial companies shrank by 22.9% in the December 2022 quarter," wrote Pavitra Kanagaraj. Companies with sales growth of less than Rs 250 million did not see any growth in wages and wage growth fell even in large companies with sales above Rs 5 billion. "The number of middle-income taxpayers in India has declined dramatically after 2018-19, falling 17% in the subsequent two years, from 49.8 million to 41.1 million. In the same period, the number of high-income taxpayers rose 15%, underscoring how the pandemic has accentuated inequities." Mint. Naturally, "India's gross domestic product (GDP) for the October-December quarter moderated to 4.4 percent, the data from MoSPI showed." ET. As households struggle to pay for their expenses, net financial savings have declined to a three-decade low of 4% of GDP in the first half of FY23 from 7.3% of GDP in FY22 and 12.0% in FY 21. The decline of financial savings was broad-based, said a report. ET. Even so, "Companies in sectors such as consumer durables, paints, jewelry, quick service restaurants (QSRs), apparel and footwear have seen a slowdown post the festive season last quarter." wrote Jethmalani, Pengonda & Sampath. "Even as people ate less pizzas and fried chicken, they bought less clothes and lipsticks, too." One reason why the rich got richer while the poor and middle-class suffered is because central banks kept interest rates low which allowed the rich to accumulate assets by borrowing. The Adani Group had a gross debt of Rs 2.26 trillion or $27.3 billion as of September. TOI. More than the nominal GDP of 115 countries in the world, as estimated by the IMF. wikipedia. Lack of jobs for the unskilled labor has forced many to return to low-paying agricultural jobs. "The agricultural sector witnessed a return of 36 million workers between 2017-18 and 2021-22. So pronounced was it that the absolute count of workers in agriculture stood higher in 2021-22 than in 2011-12, a decade ago," wrote Prof Himanshu. So huge has been the rise in the income of the rich that, "India's per capita income has doubled to Rs 1,72,000 in nominal terms since the Narendra Modi-led government came to power in 2014-15, according to the National Statistical Office (NSO)." TOI. The average is getting richer. Obviously, some are more equal.

War games. Not funny.

"The 2023 Budget will see China's defence spending during the year rise to 1.55 trillion yuan or roughly  $225 billion. This is 7.2 percent higher than the 2022 budget." ET. "However,... the US Department of Defense noted that China's real military spending might now be around 1.1 to 2 times higher than stated in its official budget." "In 2023, the PLA is expected to commission more advanced warplanes including J-20 stealth fighter jets and J-16 multirole fighter jets," and "conduct sea trial for the country's third aircraft carrier, the electromagnetic catapults-equipped Fujian." India's defence budget is expected to be $72.6 billion in 2023-24. "When Saudi Arabia and Iran buried the hatchet in Beijing..., it was a game changing moment both for a Middle East shaped by their decades-old rivalry, and for China's growing influence in the oil-rich region." CNN. "In retrospect, Beijing  has been poised to broker the conflict-ridden Middle East's latest diplomatic breakthrough for years, simultaneously underscoring the US' diminishing regional influence." The US is being seen as a bully and a coward by the world. "A former US Marine badly injured in Afghanistan has described the withdrawal in 2021 as a 'catastrophe' in testimony before Congress." BBC. On 26 August 2021, two suicide bombers killed 13 US soldiers and 170 Afghan civilians at Kabul airport. "Sgt Vargas-Andrews testified that he and another US Marine had received intelligence about the bombing before it occurred, and that he had spotted the suspect in the crowd. He said he had alerted his supervisors and requested permission to act but had never received it." The dollar's dominance in international trade may diminish. "After a coalition opposed to the war imposed an oil price cap on Russia on Dec 5, Indian customers have paid for most Russian oil in non-dollar currencies, including the United Arab Emirates dirham and more recently in Russian rouble, multiple oil trading and banking sources said." However, it is not one way for China. "With a combination of militant attacks and economic instability forcing China to limit its activities in Pakistan, the United States (US) is trying to step into the vacuum with a big financial package." Firstpost. The Tehrik-e-Taliban Pakistan (TTP) and Baloch freedom fighters have attacked Chinese nationals working on the China-Pakistan Economic Corridor project in Balochistan and Khyber Pakhtunkhwa. To counter China's influence in the Indo-Pacific, "The leaders of US, UK and Australia have unveiled new details of their plan to create a fleet of next generation nuclear-powered submarines. Under the Aukus agreement, Australia will first receive at least three nuclear-powered submarines from the US." BBC. That may neutralize the threat of the new aircraft carrier. China and the US are playing games with lethal weapons. One mistake and war could break out. Behaving like criminal gangs is dangerous. For everyone.         

Decoupled already.

"The RBI (Reserve Bank of India) should 'pause and think' if it can continue mirroring the US Federal Reserve 'stroke-by-stroke' in terms of rate hikes or decouple from the American central bank, SBI (State Bank of India) group chief economic adviser Soumya Kanti Ghosh said." TOI. "Ghosh said he does not see an end to the rate hike cycle of the Fed in the short term, which makes a case for the RBI to contemplate about decoupling." In fact, "The Federal Reserve will likely need to raise interest rates more than expected in response to recent strong data and is prepared to move in larger steps if the 'totality' of incoming information suggests tougher measures are needed to control inflation, Fed Chair Jerome Powell told lawmakers." Reuters. "The three-month London interbank offered rate (Libor) for dollars, a major global lending benchmark, surpassed 5% for the first time in more than 15 years on 5 March." ET. The surge "has been driven by expectations for Fed policy tightening. Traders not only expect a higher terminal rate, but the Fed to stay at that level for a longer period than previously expected." "India Inc, which is already facing margin pressures, could be hurt if (US) interest rate stays higher, says UBS." ET. "According to the UBS, markets are more than fully pricing in three further Fed rate hikes to 5.5%, from the current level of 4.50% to 4.75%." "The dollar is at its highest level since 2000, having appreciated 22 percent against the yen, 13 percent against the Euro and 6 percent against emerging market currencies since the start of this year," wrote Gita Gopinath, Pierre-Olivier Gourinchas on October 14, 2022. One US dollar bought Rs 74.5133 on 1 January 2022, exchangerates. org.uk. The dollar is trading at Rs 81.91 this morning. xe.com. That is a fall of just over 10%. "On average, the estimated pass-through of a 10 percent dollar appreciation into inflation is 1 percent." Hence the more the rupee falls against the dollar in response to higher US interest rates the higher will be the inflation rate in India. "Indians are feeling the pinch of rocketing prices, passed on by companies across industries to save their margins from high input costs. As the low-to-mid income generating population largely feels the heat, consumption is seeing a sharp downturn, and household savings have slumped to a three-decade low." ET. That will hurt growth of the economy. "Specifically, foreign exchange intervention should not substitute for warranted adjustment to macroeconomic policies." That is IMF-speak for not trying to control inflation by trying to strengthen local currency by selling dollars, but by raising interest rates. "India's foreign exchange reserves rose for the first time in five weeks and stood at $562.40 billion as of the week ended March 3." ET. It had reached a record high of $642.453 billion in the week ended September 3, 2021. BS. So, RBI is selling dollars to support the rupee. Why is Ghosh asking RBI not to raise interest rate, against IMF advice? Because as bond prices fall and yields rise the SBI makes mark-to-market (MTM) losses on its investment in government and other bonds. Reuters. SBI is a government bank. So. the RBI and the SBI care more for the government than the nation or its people. This is India.

Too much sugar?

"Global banking and financial stocks took a massive hit...after US-based commercial lender SVB Financial Group was shuttered by US regulators, following an aggressive decline in its stock that led to a market loss of over $80 billion. With this, Silicon Valley Bank became the largest US bank to fail since the 2008 financial crisis." "The Federal Reserve has been raising interest rates from their record-low levels since last year in its bid to fight inflation." ET. "As higher interest rates cause the market for initial public offerings to shut down for many startups and made private fundraising more costly, some Silicon Valley clients started pulling money out to meet their liquidity needs." "SVB's collapse into Federal Deposit Insurance Corp (FDIC) came suddenly..., following a frenetic 44 hours in which its long-established customer base of tech startups yanked deposits." ET. "The bank's total deposits exploded higher over the prior twelve months, to about $124 billion from $62 billion, according to data compiled by Bloomberg." "Still, the FDIC only insures bank deposits of up to $250,000 - and SVB's clients had much more. That meant a large amount of money stashed at SVB was uninsured: more than 93% of domestic deposits as of Dec 31, according to a regulatory filing." Panicked depositors tried to get their money out, creating a run on the bank, which occurs when a large number of customers try to withdraw their money, increasing the probability of default and prompting more depositors to withdraw their deposits. Investopedia. "QE (quantitative easing) involves central banks printing money and pumping it into the financial system by buying bonds," wrote Vivek Kaul. "QT (quantitative tightening) is the opposite," in which "Between June and August 2022, the US Fed plans to suck out $47.5 billion per month. Post that the plan is to suck out $95 billion per month." "Commercial banks, which typically hold the reserves supplied by central banks during QE, finance their own assets with short-term demand deposits that represent potent claims on their liquidity in tough times," wrote Profs Raghuram Rajan and Viral Acharya. "In sum, during periods of QE, the financial sector generates substantial potential claims on liquidity, eating up much of the issued reserves. The quantity of spare liquidity is thus much smaller than that of issued reserves, which can become a big problem in the event of a shock, such as a government-induced scare." The scare came as, "Federal Reserve Chair Jerome Powell... reaffirmed his message of higher and potentially faster interest rate hikes." Reuters. "The faster the rate hike cycle, the greater the risk of financial accidents with nasty spillovers. After all, the financial system did what it was incentivized to do," wrote Mohamed A El-Erian. Is our Reserve Bank (RBI) concerned at all? Too much sugar kills.

No big deal.

"Last July, more than 20 children were admitted to the Pediatric Emergency Unit of the Edward Francis Small Teaching Hospital in Gambia with kidney failure." Reuters. "Nearly all died." "Three months later, the deaths of more than 70 Gambian children from Acute Kidney Injury were linked by global health officials to cough syrups made in India and contaminated with ethylene glycol (EG) and diethylene glycol (DEG)." "Pharmaceutical experts have warned for years about lax oversight of drugs made in India, whose industry supplies nearly half of the generic medicines used in Africa. India's regulator says it found no fault with the medicines." If it is any consolation to Africans, we in India are treated even worse. "In a shocker, the Shinde-Fadnavis government in Maharashtra has admitted to an incident of 'bonded labor' involving the death of a minor tribal girl after the opposition Maha Vikas Aghadi raised the issue." DH. Bonded labor, or debt bondage, is where a debtor is made to pay back his/her loan through unpaid labor. wikipedia. However, since the borrower is usually extremely poor and the interest charged is usurious, the debt is almost impossible to pay off and passes down to children. Bonded labor was banned by The Bonded Labour System (Abolition) Act, 1976. labour.gov.in. In 2018, India was placed 53rd out of 167 countries with nearly 8 million people in some form of forced labor. testbook.com. On 24 March 2020, a stringent lockdown was forced on Indians with just 8 hours notice when there were just 500 confirmed cases of Covid-19. wikipedia. Millions of people packed into cramped shops in a frenzy of panic buying of essentials. India Today. As millions of migrant laborers lost their jobs and livelihoods they were forced to walk hundreds of kilometers back to their villages as all public transport was shut down. "All along the 800 km, Pune-to-Bhopal stretch of the Mumbai -Agra NH, thousands upon thousands of migrant workers, children in arms, stumbling along, are stretched out in unending lines." TOI, 12 May 2020. "Exhausted people sleep on the roadside. Children cry in hunger. Mothers cast anguished glances at vehicles that won't stop." The Gujarat government released 11 men on Independence Day last year, convicted of gang rape of 21-year-old Bilkis Bano in 2002, when she was pregnant, and killing 14 members of her family, including her three-year-old daughter whose head was bashed in with a rock. NDTV. Gurmeet Ram Rahim, serving a 20-year jail sentence for rape and murder, is repeatedly released on parole and has politicians touching his feet. TOI. It is no consolation for African parents who have lost their children, but we citizens of India have no right to life or dignity in death. Please mourn for us.         

Starlink, ASML and cranes.

"Chinese leader Xi Jinping gained an unprecedented third term as president of the country on Friday (today)." CNBC. He was also "formally reappointed" as Chairman of the Central Military Commission and has "consolidated his control of the ruling party by filling the highest circle of leadership with loyalists." In 2016, he was given the title of 'core leader', "putting him on par with past strongmen like Mao Zedong and Deng Xioping". Reuters. He is referred to as "mighty Uncle Xi - echoing an expression used to greet an emperor". But, of course, if you wear a crown you have to watch out for banana skins. "China needs the capability to shoot down low-earth-orbit Starlink satellites and defend tanks and helicopters against shoulder- fired Javelin missiles, according to Chinese military researchers who are studying Russian military struggles in Ukraine in planning for possible conflict with US-led forces in Asia." Reuters. "Starlink is the world's first and largest satellite constellation using a low-earth orbit to deliver broadband internet capable of supporting streaming, online gaming, video calls and more." Starlink is controlled by SpaceX, which is controlled by Elon Musk, wrote Noah Clarke. To develop advanced missile and satellite technology China needs semiconductor chips. But, "The Dutch government is to put restrictions on the country's 'most advanced' microchip technology exports to protect national security, following a similar move by the US." BBC. "It will include products by chip equipment maker ASML, a key firm in the global microchip supply chain." In January, under pressure from the US, Japan also agreed to restrict exports of chip manufacturing technology to China. The Verge. China will surely increase attempts at accessing technology through espionage. Last month, "US military fighter aircraft shot down a suspected Chinese spy balloon as it floated off the coast of South Carolina." ET. Two US Senators are to introduce a bill "aimed at granting President Joe Biden's administration new powers to ban Chinese-owned video app TikTok and other apps that could pose security risks". Reuters. "Now, American officials raised concerns over the possibility of a 'new tool' of spying hiding in plain sight: giant Chinese-made cranes operating at US ports. TOI. "Officials have compared these 'ship-to-shore' cranes, which are well-built but inexpensive, to a 'Trojan Horse'." While the US is trying to stop supply of technology to China it is supplying vast amounts of money to China as, in 2022, "The annual goods-trade deficit with China widened 8% to $382.9 billion, the biggest on record after the $419.4 billion shortfall in 2018." ET. A tiny portion of that mountain of cash can buy people willing to sell technology secrets to China. China could certainly use a genius billionaire like Elon Musk to develop its own cutting-edge technology, but Chinese billionaires have a habit of disappearing, and are said to be "assisting with investigations". BBC. There is concern that President Joe Biden has early dementia. Newsweek. Dementia, megalomania and disappearing billionaires. Material for a serial?

Their inflation, our inflation.

"The next economic downturn has become the most anticipated recession in recent US history. It also keeps getting postponed," wrote Nick Timiraos. "The government's stimulus measures left household and business finances in unusually strong shape." In March 2020, the US government handed out $1200 to every adult earning less than $75,000 per year and $500 per dependent. In December 2020, $600 to individuals and dependents. And in March 2021, $1400 to every individual and dependent. CNBC. In India, the share of indirect taxation has increased to over 50% of the government's tax revenues. TOI. Around 63 million people filed income tax returns in 2019-20. In 2018-19, 40% of those who filed returns, or 55 million people, had no tax liability and only 33 million paid any income tax. Indians just do not earn enough.  The government earned more from taxes on petroleum products during the Covid years. From Rs 1.3 trillion  in 2014-15, taxes collected on petroleum products rose to Rs 4.3 trillion in 2021-22. TOI. Not only has the government raised taxes, "There has been a rise of 133 percent of major cess and surcharges levied by the Central government on various products during the five year period between 2017-18 and 2022-23." ET. Adding insult to injury, as it were. In the US, retail sales rose 3% in January, easily topping the Dow Jones estimate, the Commerce Department reported. CNBC. "The January jobs report showed nonfarm payrolls increased by 517,000, far higher than the 187,000 market estimate." CNBC. "Layoffs rose to a two-year high in January and job cuts were higher than initially thought in 2022." Reuters. "Nevertheless, the labor market remains strong, with 1.9 job openings per every unemployed person, down from 2.0 in December." In India, the Periodic Labor Force Survey (PLFS) showed "that the unemployment rate in 2021-22 was recorded at 4.1%, lower than the 5.8% witnessed in 2018-19." The Wire. However, the share of agriculture in overall employment rose from 42.5% in 2018-19 to 45.5% in 2021-22. "People move to farming when no jobs are available in the markets." "Private equity and venture capital (PE/VC) funding to India's startup ecosystem fell 77 percent from a year earlier, as investors continued treading cautiously amid macroeconomic uncertainties." moneycontrol. "The Federal Reserve will likely need to raise interest rates more than expected in response to recent strong data and is prepared to move in larger steps if the 'totality' of incoming information suggests tougher measures are needed to control inflation, Fed Chair Jerome Powell told US lawmakers." Reuters. Higher interest rates in the US will strengthen the dollar which will increase the price of imports into India, and the weakness of the global economy and the war in Ukraine will limit exports, wrote Andy Mukherjee. "The stagflation risks - heightened by the co-movement of commodity prices and the dollar over the last two years - may not have had the same deleterious impact on India as its smaller neighbors. But they haven't exactly left 1.4 billion people unscathed." A strong dollar may help Americans by making imports cheaper while high taxes and rising prices make life miserable for Indians. Stagflation isn't unthinkable.

Should be a sacred duty.

"India's per capita income has doubled to Rs 1,72,000 in nominal terms since Narendra Modi-led NDA government came to power in 2014-15, according to the National Statistical Office (NSO)." TOI. This is "up from Rs 86,647 in 2014-15, suggesting an increase of about 99 percent." Is it time to bang pots and pans in celebration as we did in 2020? BBC. Not quite. Growth of per capita income was 5.6% per annum from 2014-2019, said Pinaki Chakraborty. But, high retail inflation eroded the value of earnings at about the same rate. macrotrends. Retail inflation rose to 6.52% in January 2023 from 5.72% in December. Reuters. This is also reflected in the value of the Indian rupee which has dropped from 62.33 against the US dollar in 2014 to 81.35 in December 2022. bookmyforex. Per capita means an average of the total income of the nation divided by its population. ET. So, if we take two Indians, one earning $1 billion and the other earning zero, the per capita income will be $500 million, instantly elevating a destitute beggar into a prince. That may seem facetious, until "Highlighting that the richest 21 Indian billionaires have more wealth than 700 million Indians, a new report from Oxfam states." TOI. The number of billionaires has jumped from 102 in 2020 to 166 in 2022 and their wealth surged by 121%, at Rs 36.08 billion per day in real terms. "Economist Jayati Ghosh emphasized that distribution is critical, and median wages are falling in real terms." Referring to the sequential decline in the rate of growth of the economy, Prof Raghuram Rajan commented that this is "dangerously close" to the 'Hindu rate of growth', a term coined by "economist Raj Krishna in 1978 to describe low Indian growth rates of about 4% in the 1960s and 1970s". The Wire. "A key economic indicator shows that only half of capital is now needed for the next unit of output in India, which is on a 'sound footing' and notions of 'Hindu rate of growth' is ill-conceived," said a research note from the State Bank of India (SBI). ET. For its riposte, the SBI has used the Incremental Capital Output Ratio (ICOR) which "favors developing countries that can increase infrastructure and technology use as opposed to developed countries, which are operating at the highest level possible." Investopedia. Increased use of existing infrastructure is shown by the Capacity Utilisation, which has soared from 47.3% in June 2020 to 74% in September 2022, according to the Reserve Bank (RBI). CEIC. Also falling wages in real terms may have reduced the cost of production. If, as the SBI thunders, the economy is on a "sound footing", we should have more money to spend. But, "In the six years between 2014-15 and 2019-20, the economy's gross savings rate has come down from 32.2% of gross domestic product (GDP) to 29.9%," wrote Rajrishi Singhal. Fell more after that due to Covid. It is the sacred duty of banks to protect our wealth. Not to act as a megaphone for the government. Or, it should be.   

Slow slide into tyranny.

"A video has gone viral on social media where several posters, claiming that women and minorities are treated like 'slaves' in India among other hateful things," shot by an Indian student in front of the United Nations Human Rights Commission in Geneva, Switzerland. News18. An outraged "India's ministry of external affairs (MEA) summoned Switzerland's ambassador...to protest against 'unfounded and malicious' posters put up in front of the United Nations (UN) office in Geneva, people familiar with the matter said." "The embassy has conveyed India's concerns to Berne with all the seriousness it deserves," said the ambassador. "Seriousness it deserves" can mean anything in diplomatic-speak: From "This is deplorable and will be investigated" to "Don't waste our time with trivia". In January, the BBC released a two-part documentary on the riots in Gujarat in 2002 when Narendra Modi was the chief minister of the state. In response, the government blocked all social media channels from showing the documentary. TOI. And, as is usual, BBC offices were searched by income tax authorities. BBC. Tax officials also seized phones and laptops belonging to BBC employees. NDTV. "In February, Congress leader, "Pawan Khera was arrested at Delhi Airport, where he was forced off a plane...alongside other party members, after he called Modi 'Narendra Gautamdas Modi' - an apparent reference to embattled business magnate Gautam Adani." CNN. After Khera tendered an unconditional apoplogy, Chief Minister of Assam Himanta Biswa Sarma tweeted, "The majesty of law shall always prevail." "We hope that by keeping the sanctity of public spaces, no one will use uncivilised language in political discourse hereafter." DH. On 11 February 2022, Sarma asked Congress leader Rahul Gandhi "Did we ask you for proof of whether you are Rajiv Gandhi's son or not?" wikipedia. So, Sarma was calling Gandhi a 'bastard'. Yesterday, Karnataka BJP President Nalin Kumar Kateel said that Rahul Gandhi is not getting married because he knows he can't have kids. Zee. Did he mean that Gandhi is impotent? Is that an example of civilised language? Careful. There are other men who have not been able to produce children. In a speech at Cambridge University Rahul Gandhi said his phone was infected with the Pegasus spyware and that Indian democracy is under attack. HT. That is very brave of him because the hounds will be snapping at him as soon as he lands in India. "Along with an image of a powerful leader, whenever he is cornered, Modi has not let go of an opportunity to project himself as one more sinned against than sinning, and has continued taking refuge in melodramatic distractionism." DH. Modi is the most popular leader in the world with an approval rating of 78%. BS. Why then do his supporters react with such primeval savagery to any criticism? Because their survival depends on Modi. They are terrified that if they lose power , they may have to face what they are doing to us at present. So, they will resort to any action, no matter how reprehensible, to stay in power. That is how dictators are made.

5% bigger than 7%.

"India can achieve the 7 percent GDP growth in current financial year as projected by the National Statistical Office, Chief Economic Advisor V Anantha Nageswaran said." ET. "The CEA said the country needs to grow at 4-4.1 percent in the March quarter to achieve 7 percent real GDP growth rate for the full financial year." This is so important because, "China set a modest target for economic growth this year of around 5% on Sunday (yesterday) as it kicked-off the annual session of its National People's Congress (NPC)." Reuters. "China's gross domestic product (GDP) grew by just 3% last year, one of its last showing in decades, one of its worst showing in decades, squeezed by three years of Covid-19 restrictions, crisis in its vast property sector, a crackdown on private enterprise and weakening demand for Chinese exports." This means that India is growing faster than China. Yah, boo. But, "India has already become the world's fifth largest economy in the 75th year of Independence and will reach the USD 3.5 trillion mark by end-March, said the Economic Survey." ET. China, on the other hand, is already the second-largest economy of the world with a nominal GDP of US$18 trillion. wikipedia. Which means that at 7% growth India will add about $250 billion to its economy while at 5% China will add a huge $900 billion. Since, "In two months, India is projected to become the world's most populous country with over 1.4 billion people," Reuters, China's GDP per capita will zoom even higher than that of India's. Even as there was a "weakening demand for Chinese exports", "Trade in goods between the US and China climbed to a record in 2022," as "Total merchandise trade between the two countries rose to $690.6 billion last year," while "The annual goods-trade deficit with China widened to $382.9 billion." ET. Meanwhile, "The trade between India and China touched an all-time high of USD 135.98 billion in 2022," while "The trade deficit for India stood at USD 101.02 billion, crossing the 2021 figure of USD 69.38 billion." ET. "The most recent data, namely, GDP growth for the quarter ending December 2022 came at 4.4%," wrote Chanakya. This is because "GDP growth rates for 2019-20, 2020-21 and 2021-22 have been revised upwards." If it hadn't been for the higher base the growth rate in the December quarter would have been 5.1%. "India's traditional area of strength appears to be presently locked into low end services and would need to move up the value chain in the manner China is doing in manufacturing," as well as develop "a vibrant manufacturing sector". wrote Alok Sheel. "If India were to grow at the very optimistic, and currently unlikely, rate of 9% going forward, and China were to slow down to 4%, the Indian economy would be 70% of China's size by mid-century." Absolute numbers give the game away. Better to talk in percentages. Just fool the people.

Non-identical twins. With similarities.

"In the heart of Marriabad, a congested area dominated by the Hazara community, a clean street leads to a house where Shahida Raza - a Pakistani national who drowned in a boat accident off Italy - lived with her mother and three sisters in a small house she had rented." Dawn. Raza made news because she represented Pakistan in hockey and was trying to enter Europe illegally to earn money for her invalid son. One year back a family from Gujarat froze to death in Canada while trying to enter the US illegally. "Canadian police found the four of them - Vaishalben, 37, Jagdish, 39, their daughter, Vihangi, 11 and son. Dharmik, 3 - lying together, frozen, in an empty field on 19 January. They had died 12 meters from the US border." BBC. In November 2022, Brijkumar Yadav, 36, from Gandhinagar in Gujarat "fell to his death while climbing the 30-meter-tall metal wall on the Mexico-US border, also known as the Trump wall. Reports stated that he was carrying his son while scaling the wall. His son and wife also fell, but are reported to have survived." DH. Why are Gujaratis so desperate to escape to the US when, "We are marking Azadi ka Amrit Mahotsav and have entered into Amrit Kaal, the 25-year-long lead up to India@100," said Finance Minister Nirmala Sitharaman while presenting the 2022 budget. The Quint. 'Amrit' means the 'nectar of eternal life' and 'kaal' means an 'epoch'. "According to the UN's refugee agency, over 82,000 Indians had sought asylum around the world in 2022 - up sharply (and progressively increasing) from about 12,000 in 2013." DH. "After 1971 (independence of Bangladesh, wikipedia), the four provinces of West Pakistan became a residual Pakistan, but with two separate nations," - "The higher strata enjoy the benefits of five-star roti, designer kapra (clothes) and makan (house) (usually abroad), while the lower strata wait still for Bhutto's successors to redeem his promise." Dawn. Oxfam's "report on inequality in India...finds that just 5 percent of Indians own more than 60 percent of the country's wealth, while the bottom 50 percent of the population possess only 3 percent of the wealth." TIE. As of January 2023, India has 166 dollar billionaires, third behind the US and China, wikipedia. "Regarded as a primary natural resource by Jews inside and outside Israel it is an obsession for parents who, spoon by spoon, zealously ladle knowledge into their children," wrote physicist Pervez Hoodbhoy. "There are lessons here for Pakistan." "India has nearly 1.2 lakh (120,000) schools with just one teacher each." TOI. So, "Indian students going abroad for higher education recorded a six-year high in 2022 at 750,365, according to the education ministry data." HT. Leaving behind the partially literate. "I think Pakistan's future is largely determined by Pakistan's actions and by Pakistan's choices," said India's External Affairs Minister S Jaishankar. India Today. Pakistan was born on the same day as India. We are, therefore, twins. Dissimilar certainly, but why tempt fate?

Pizzas and fried chicken.

"Worries about India's consumption growth slowing down are overdone," wrote Rajesh Shukla. "Currently consumption is highly skewed in favor of the middle classes and the rich," - "for instance the share of the bottom 20% of the population in total household disposable income was about 6.5% in pre-Covid, down to 3% during Covid and again up to 4.5% now." "Using ICE 360 Surveys data, we have estimated the income elasticity of food to be 0.47, which is relatively lower than other consumption items such as education (0.79 rural and 0.67 urban) and conveyance (1.08 rural and 0.97 urban)." Which should mean that as Indians get more affluent they spend more of their earnings on discretionary goods and services. Growth in the food delivery business is beginning to taper off, wrote Jethmalani, Pengonda & Sampath. "Our analysis suggest that forced savings (given an inability to spend on goods and services during lockdowns) and precautionary savings (fear of job loss and economic uncertainty) led Indian households to save an extra $180 billion over 2020 and 2021," said Tanvee Gupta Jain, chief economist, UBS Securities India. "We believe household spending was pulled forward over the past year (until September 2022) using their excess savings accumulated during the pandemic." "Even as people ate less pizzas and fried chicken, they bought less clothes and lipstick too. Those who shopped possibly ordered the cheaper stuff." "What is loosely described as a K-shaped recovery," "has a bearing on private consumption, which makes up over 60% of GDP." Mint. "Clearly, any upward financial skew that leaves out the buzzy bulk of Indian buyers would go against the prospects of a general consumer boom." "Sustained for years at a stretch, inequitable expansion would put our economy at risk of slipping into a middle-income trap, that would make high income status an elusive goal even a quarter century hence." "Mobile tele-density has been falling for more than five years now. In October-December it stood at 82.6 (826 mobile connections for every 1,000 individuals)," wrote Vivek Kaul. It was 92.1 in March-June 2021. "The S&P Global India Manufacturing Purchasing Managers' Index (PMI) was 55.3 in February, little-changed from 55.4 in January, the private survey showed." Mint. "Private equity and venture capital (PE/VC) funding to India's startup ecosystem fell 77 percent in February from a year earlier, as investors continued treading cautiously amid macroeconomic uncertainties." moneycontrol. "In the recent weeks, over tens of thousands of tech employees have been laid off across the globe." Mint. Employees of such companies in India will also see some reductions. "Unemployment rate among those between 19 and 29 years old with a graduate degree stood at 29.1% in India in 2021-22," wrote Abhishek Jha and Roshan Kishore. "What makes matters worse is that unpaid work hides actual unemployment." Some are predicting a glorious future for India while the present is a struggle. Perhaps they are alchemists.

Who guards the opaque systems?

"Corruption directly vitiates the relationship of the citizen with the state." The Santhanam Committee, set up in 1957, "recommended the creation of the institution of Central Vigilance Commission (CVC) to oversee and monitor vigilance administration of various central government organisations," wrote Secretary, Central Vigilance Commission P Daniel. Mr Daniel joined the Directorate General of Defence Estates (IDES) on 21.08.1989. Ministry of Defence. The Indian Defence Estates Service (abbreviated as IDES) is a Civil Service in the Government of India. wikipedia. "Corruption primarily involves selfish exercise of powers, which operates in shadows, aided by opaque systems." "To promote the idea of probity in public life, an integrity pledge has been designed for citizens and organisations. Here, citizens commit to uphold highest standards of probity and rule of law in all walks of life." That is indeed uplifting. But, what happens when citizens are assaulted by authorities or when authorities connive with criminals to subvert justice? "Three men accused in the 2020 Hathras gang-rape-murder case, which sparked protests across the country were acquitted by a court in Uttar Pradesh on Thursday (yesterday) while the main suspect was convicted of culpable homicide not amounting to murder." NDTV. "On the last day of September 2020, 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." BBC. "In a 48-second video filmed at the scene and shown to the BBC, she can be seen lying on a cement platform while she is questioned by a policeman off camera." "She tells the policeman her attacker tried to strangle her and the policeman asks her why. 'Because I wasn't letting him do zabardasti,' she says." 'Zabardasti' means 'force', or rape in case of a woman. "A senior police official investigating violence on members of the Dalit community at Bhima Koregaon on January 1, 2018, has, on oath, that the Elgar Parishad event, organised 30-kilometers away in Pune city, had no role in the violence." The Wire. In fact, forensic analysis of laptops belonging to some of the accused were found to contain malware with false incriminating evidence. Outlook. Even the Supreme Court has not been able to give a verdict on the Pegasus spying case because the government refused to cooperate. NDTV. "Give me ED and CBI, I will arrest Modi, Shah and Adani within two hours. You can do anything when you have the power to misuse probe agencies," said AAP MLA Sanjay Singh. Zee. All the major investigating agencies are controlled by government officers and are seen as biased. The Wire. The government has the power to operate "in the shadows, aided by opaque systems" designed by itself. Will the CVC start with those? Which brings us to a two-thousand year old wisdom: "Quis custodiet upsos custodes". wikipedia. "Who will guard the guard themselves."

Americans spend more.

"Prices in the US, according to the Federal Reserve's preferred metrics, rose 5.4% from a year earlier and the core gauge was up 4.7%, both hotter than forecast after slowing for several months. In Europe, core price growth reached a record 5.3% - more than the initial reading of 5.2%. Headline inflation, which includes food and power, also ticked up. Inflation is also too high in Israel and New Zealand, where officials hiked rates." ET. "Consumer spending, which accounts for more than two-thirds of US economic activity, shot up 1.8% last month. That was the largest increase since March 2021." Reuters. "When adjusted for inflation, consumer spending increased 1.1%, also the biggest gain since March 2021." "The overall surge in spending came as wages and salaries jumped 0.9%," and "The economy grew at a 2.7% pace in the fourth quarter." "The Commerce Department reported that the Personal Consumption Expenditures price index, the metric by which the Fed measures its 2% inflation target, rose 5.4% last month (January) from a year earlier, a pickup from an upwardly revised 5.3% annual pace in December." Reuters. "She (Cleveland Fed President Loretta Mester) is among the minority of Fed policymakers who in December thought they would need to lift the policy rate to 5.4% to stop inflation, while most believed 5.1% would suffice." This is ominous for India. In its last meeting on 6-8 February, the Reserve Bank (RBI) raised interest rate by 25 basis points to 6.5%. RBI. Till March 2022 the Federal Funds rate was 0-0.25% and was increased by 25 basis points on 17 March 2022. After a total of 8 hikes since then the Funds rate is at 4.50% to 4.75%. Forbes. While the interest rate in the US was at 0 lower bound, the RBI kept the interest rate in India constant at 4% from May 2020, NDTV, until forced to increase its repo rate in an emergency meeting of the Monetary Policy Committee in May 2022. ET. Therefore, till May 2022 the difference in interest rates between India and the US was 4%. The difference has narrowed to 2% presently, and if it narrows still further foreign investors will have little incentive to invest in India because they will lose money if the dollar strengthens against the Indian rupee. "India's forex reserves declined by $5.68 billion to $561.27 billion as of February 17," as "The reserves have been declining as the central bank deploys the kitty to defend the rupee amid pressures caused majorly by global developments." ET. "India's gross domestic product (GDP) for the October-December quarter slowed to 4.4 percent, the data shared by the Ministry of Statistics and Programme Implementation showed." ET. "The slowdown was caused primarily by slowing manufacturing activity, weaker personal consumption, and lower government expenditure." Quartz. "Consumer prices have been on the rise for nearly a year, affecting Indians' purchasing power." The US Fed is determined to control inflation to protect the spending power of Americans. The RBI is concentrated on supporting the rupee even as Indians are increasingly impoverished by inflation. Americans are richer than Indians because they can buy more. Simple.