Government bailouts a moral hazard: Chief economic adviser K. Subramanian
5 years, 4 months ago

Government bailouts a moral hazard: Chief economic adviser K. Subramanian

Live Mint  

New Delhi: Government intervention in the private sector creates a moral hazard, India’s chief economic adviser warned, a statement that could temper expectations of a stimulus for cash-strapped Indian businesses. Speaking in New Delhi on Thursday, Krishnamurthy Subramanian said India has been a market economy since 1991, when it opened up to foreign competition. “You introduce possible moral hazard from too-big-to-fail and possibility of a situation where profits are private and losses are socialized, which is basically an anathema to the way the market economy functions.” Calls for a fiscal boost from the government for sectors like automobiles have been growing in the past few weeks after the budget from finance minister Nirmala Sitharaman failed to provide much of a support to either consumption or investment. The subdued growth numbers won’t be surprising given auto sales have fallen off the cliff and spending on hair oil to biscuits have waned as consumers fret over their jobs amid a broader global slowdown.

India Subramanian  bailouts  phase  adviser  economy  private  k  india  hazard  growth  economic  chief  subramanian  moral  market  sectors

History of this topic

Risky premise: On Asian Development Bank forecast, India’s GDP growth
9 months ago

Risky premise: On Asian Development Bank forecast, India’s GDP growth

The Hindu  

The Asian Development Bank on Thursday raised its forecast for India’s GDP growth in the current fiscal year ending on March 31, 2025, to 7%, from 6.7% earlier, citing robust public and private investment as well as expectations of a gradual improvement in consumer demand as the rural economy recovers. The ADB’s latest growth forecast for India’s GDP is, however, …

Explained | Is the economy driving with the brakes on?
2 years ago

Explained | Is the economy driving with the brakes on?

The Hindu  

The story so far: At this time last December, India’s economy was on the cusp of a fledgling recovery from the COVID-19 pandemic, though the Omicron variant posed fresh speed bumps for the rebound. As JP Morgan managing director and India chief economist Sajjid Chinoy explained at a CII economic policy summit last week, 2022 was expected to see a …

BJP’s three-fold economic challenge in the run-up to 2024
3 years, 6 months ago

BJP’s three-fold economic challenge in the run-up to 2024

Hindustan Times  

The cabinet reshuffle on July 7 comes almost at the half-way point of the second term of the Modi government. The reshuffle has come on the back of a series of adverse events for the Bharatiya Janata Party -led government: India’s largest ever economic contraction in 2020-21, a devastating second wave of the Covid-19 pandemic, a shock defeat for the …

A taper tantrum around 2024 polls could be Modi govt’s biggest economic trial
3 years, 10 months ago

A taper tantrum around 2024 polls could be Modi govt’s biggest economic trial

Hindustan Times  

When the Indian economy contracted by 23.9% in the quarter ending June 2020—the biggest contraction among major economies—everyone feared an unprecedented economic crisis. With the Biden administration planning to give another fiscal stimulus and the federal reserve announcing that it will not increase interest rates lest the economic recovery is jeopardised, inflation could increase going forward. If the taper tantrum …

India's economy expands 0.4% in Oct.-Dec., ending recession
3 years, 10 months ago

India's economy expands 0.4% in Oct.-Dec., ending recession

The Independent  

For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails Sign up to our free breaking news emails Sign up to our free breaking news emails SIGN UP I would like to be emailed about offers, events and updates from The Independent. Read our privacy policy India’s economy expanded by a …

India exits recession but rapid GDP growth is still a long way off
3 years, 10 months ago

India exits recession but rapid GDP growth is still a long way off

CNN  

New Delhi CNN Business — India’s economy is out of recession but still a long way from returning to rates of growth seen before the pandemic. In a research note on Friday, Shilan Shah, senior economist at Capital Economics, estimated that GDP grew 9.2% in the last quarter of 2020 compared with the previous quarter, “enough to lift it back …

Fall in GDP alarming; time for bureaucracy to take meaningful action: Raghuram Rajan
4 years, 4 months ago

Fall in GDP alarming; time for bureaucracy to take meaningful action: Raghuram Rajan

Live Mint  

New Delhi: Terming the 23.9 per cent fall in economic growth in June quarter alarming, former Reserve Bank Governor Raghuram Rajan has said bureaucracy should come out of complacency and take meaningful action. Noting that India needs strong growth, not just to satisfy the aspirations of country's youth but to keep its unfriendly neighbours at bay, Rajan said temporary half-baked …

India’s growth story has never seemed so endangered
4 years, 4 months ago

India’s growth story has never seemed so endangered

Live Mint  

We all knew it would be bad, but no one could have predicted just how bad. Supply and credit links, which had been largely cash-based in the informal sector, among others, remained broken even after high-denomination currency came back into circulation, and some small businesses and poorer households—we will likely never know how many—never recovered to their level of well-being …

Finally, it falls to the farmer to rescue India\'s parlous GDP
4 years, 4 months ago

Finally, it falls to the farmer to rescue India\'s parlous GDP

Deccan Chronicle  

New Delhi: The release of GDP data for the corona-disrupted first quarter of 2020-21 on Monday came as a shocker despite the foreboding there had been for weeks earlier. "We are witnessing a V-shaped recovery as the economy unlocks E-way bills at 99.9 per cent vs August last year despite local lockdowns. As per the data, manufacturing has entered recession …

Opinion | A risk-management approach could guide our next stimulus
4 years, 5 months ago

Opinion | A risk-management approach could guide our next stimulus

Live Mint  

Since the start of the coronavirus pandemic, the gross domestic product projection for India compiled by Consensus Economics in 2020-21 has fallen from 5.9% in February to -4.6% in July. Even the Reserve Bank of India, which has not updated its economic projections in the past four months, citing lack of adequate data, agrees that the economy will contract. Reports …

Opinion | A long-term strategy to steer the economy out of this crisis
4 years, 6 months ago

Opinion | A long-term strategy to steer the economy out of this crisis

Live Mint  

As an entrepreneur and then as a member of Parliament, I have seen my share of economic shocks—the 2001 tech bubble burst and then the 2008 global financial crisis. Rapid growth is the only answer to the question of India’s debt sustainability and Prime Minister Narendra Modi’s Aatmanirbhar Bharat vision of a self-reliant economy that is also globally competitive and …

Today's top business news: Govt advisor rules out big economic stimulus, ex-RBI governor says India can't take markets for granted, traders smell back-door funding of govt debt by RBI, and more
4 years, 8 months ago

Today's top business news: Govt advisor rules out big economic stimulus, ex-RBI governor says India can't take markets for granted, traders smell back-door funding of govt debt by RBI, and more

The Hindu  

Stocks have opened positive this morning and signals coming from the government suggest a significant easing of lockdown restrictions soon. PTI reports: "Real estate developers sold 26 per cent less apartments during January-March period across nine major cities as economic slowdown and coronavirus outbreak affected demand, News Corp-backed PropTiger said. Vodafone Group, in a statement, said it has “accelerated this …

India in growth recession; extreme centralisation of power in PMO not good: Rajan
5 years, 1 month ago

India in growth recession; extreme centralisation of power in PMO not good: Rajan

The Hindu  

Former Reserve Bank of India governor Raghuram Rajan said India is in the midst of a “growth recession” with signs of deep malaise in the Indian economy that is being run through extreme centralisation of power in Prime Minister’s Office and powerless ministers. Stating that previous governments may have been untidy coalitions but they consistently took path of further economic …

Growth recession: Can Modi govt ensure India rides out the storm?
5 years, 1 month ago

Growth recession: Can Modi govt ensure India rides out the storm?

India Today  

Union Finance Minister Nirmala Sitharaman has insisted that things are not as bad as they are being presented on economic front. This means at 4.5 per cent for July-September quarter might not be the lowest GDP growth rate for the current fiscal year. The economy has been slowing down for six consecutive quarters despite the Narendra Modi government announcing a …

Once the world’s fastest growing economy, India faces a slowdown
5 years, 1 month ago

Once the world’s fastest growing economy, India faces a slowdown

Al Jazeera  

India’s economy grew at the slowest pace in more than six years and the pain is widespread. “The private sector is definitely down both for consumption and investment and that’s the fundamental problem in the economy today,” said Madan Sabnavis, chief economist at CARE Ratings. “We’ll have to live with this low growth scenario for the rest of the year.” …

Economic slowdown cyclic in nature but right time to invest in India: Commerce Minister Piyush Goyal
5 years, 3 months ago

Economic slowdown cyclic in nature but right time to invest in India: Commerce Minister Piyush Goyal

Firstpost  

New Delhi: Commerce and Industry Minister Piyush Goyal on Tuesday said that the recent economic slowdown is a cyclic structural adjustment, and it is the right time to invest in India before growth bounces back. It is an opportunity for all of us to reassess capacities, productivity, costs of production, says Commerce Minister @PiyushGoyal pic.twitter.com/IaHqLyOlli — CNBC-TV18 October 15, 2019 …

GDP slump in June quarter prompts growth, rate-cut revisions
5 years, 4 months ago

GDP slump in June quarter prompts growth, rate-cut revisions

Live Mint  

Singapore: Economists cut their forecasts for India’s economic growth and predicted deeper interest-rate cuts after data showed a sharper-than-expected slump in output. Goldman Sachs Group Inc. and Citigroup Inc. lowered their growth projections to 6% for the fiscal year through March 2020, while Oxford Economics Ltd. said there’s a risk the expansion could be weaker than that. Data released on …

Tracking India’s economic slowdown: Between NITI Aayog chief’s warning and CEA’s tough talk lies real cure for economy; inaction will be disastrous
5 years, 4 months ago

Tracking India’s economic slowdown: Between NITI Aayog chief’s warning and CEA’s tough talk lies real cure for economy; inaction will be disastrous

Firstpost  

By now, the fear that India’s economy is slowing and slowing at a real dangerous pace has been confirmed by hard data Editor’s note: This is the seventh and concluding part of a series in which Firstpost’s columnists analyse the ongoing economic slowdown and offer solutions. In the absence of private sector participation, India’s economic growth fell to 5.8 percent …

Opinion | Thou shalt not socialise losses
5 years, 4 months ago

Opinion | Thou shalt not socialise losses

Live Mint  

India’s chief economic adviser K. Subramanian has some sobering, if curt, advice for the private sector. Asking for bailouts, he believes, amounts to socializing losses, while private parties get to pocket profits when the going is good. The practice of socializing losses and privatizing profits came into sharp public scrutiny at the height of the West’s Great Recession of 2008-09. …

Opinion | A self vigilance model for the Indian economy
5 years, 9 months ago

Opinion | A self vigilance model for the Indian economy

Live Mint  

The latest cuts in India’s growth forecast by international agencies should remind policymakers that headwinds against the economy are on the rise. The World Bank and Asian Development Bank have slashed their forecasts of the country’s growth in gross domestic product this year to 7.2%, while the International Monetary Fund has made a prediction of 7.3%. As IMF chief economist …

India's ostrich club & the global recession
6 years, 3 months ago

India's ostrich club & the global recession

Deccan Chronicle  

L’affaire Infrastructure Leasing and Financial Services meltdown is not a freak incident. The leaders of the BJP, who were then in Opposition, including former finance minister Yashwant Sinha, then Leader of the Opposition in Rajya Sabha Arun Jaitley and then Rajya Sabha member Nirmala Sitharaman mercilessly flayed the UPA-2 government over the country’s dithering economy, and refused to accept the …

Discover Related