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Is India Fiscally Fit? - An Opinion

  OPINION: IS INDIA FISCALLY FIT? The news about GDP of Indian economy is down by 23% is alarming.   This fall in the second quarter, the most drastic fall in decades, as lockdown restrictions meant to contain the spread of the coronavirus wiped out jobs and businesses. The decline is worst among the top economies of the world, with US shrinking by 9.5 percent, and Japan by 7.6 percent at the same time.   The data reveals that construction, manufacturing and transportation are the worst hit. Economists opine and agree with the fact that many people in India are informally employed, working in contractual jobs which may not be under the reach of government data collection umbrella, like tailors, autorickshaw drivers, daily wage earners etc.   The quantum of reduction, if one considers the informal sector job loss may be much more than 23 percent is worth noting. A rough estimate is as big as 40 percent. The official reason for slowdown is the strict lockdown i...

Is India Fiscally fit? Opinion

  OPINION: IS INDIA FISCALLY FIT? The news about GDP of Indian economy is down by 23% is alarming.   This fall in the second quarter, the most drastic fall in decades, as lockdown restrictions meant to contain the spread of the coronavirus wiped out jobs and businesses. The decline is worst among the top economies of the world, with US shrinking by 9.5 percent, and Japan by 7.6 percent at the same time.   The data reveals that construction, manufacturing and transportation are the worst hit. Economists opine and agree with the fact that many people in India are informally employed, working in contractual jobs which may not be under the reach of government data collection umbrella, like tailors, autorickshaw drivers, daily wage earners etc.   The quantum of reduction, if one considers the informal sector job loss may be much more than 23 percent is worth noting. A rough estimate is as big as 40 percent. The official reason for slowdown is the strict lockdown i...

GOLD GLITTERS!

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The gold prices is increasing from few week from continuously indicates that gold is used as hedging instrument in all uncertain times. More people turn to invest in gold because of its enduring value. When there expected return on bonds, equities, and other market instruments decreases, the price of gold increases in the market. The following is the trend of gold price in last 45 years. (Source: Bloomberg) Interesting fact to notice is the price of gold was not volatile much from 1975 to 2005 and has increased suddenly from 2005 till date.   The only exception is of 1978 was because of increase in crude oil price and inflation, which again settled to the then market equilibrium price in 1980. The price started increasing from 2005 to 2011 due to increase in the commodity prices all over the world, with slight decrease in 2008 due to financial crisis, which is popularly known as sub prime crisis. The commodity prices at that time increased due to the inelastic demand and supp...

Election manifesto: Where is Economics

The meaning of Economic development for we all economists is the improvement in the fundamentals of the economy. Each government should strive to increase the consumption, private and public investment, exports. Political parties in India are talking about the core economic development partially and spending time, money and energy on winning elections across states., where these are the office bearers should  spend less time on political issues and more time on economic issues.  All parties unveil the election manifesto before the elections. The election manifesto ideally should be the agenda for the government that the party will pursue after the election from the party office.  Writing the manifesto is having the history of last 100 years in the western countries, where the agenda was more on social development. It is in 2001 Tony Blair in 2001 and subsequently wrote a detailed manifesto citing all sectors of society in particular health, Education etc. Indian poli...