Reviving Indian Economy

Perhaps the best stimulus which our government can unleash is caring attitudes in the entire bureaucratic machinery, duly monitored by the political executive, to unleash the 'animal spirits' in businesses otherwise struggling to get back on their toes.

Secondly, it would also be great to waive of all license fees pertaining to commercial establishments for a year. But next year onwards, realize this waiver from the beneficiaries of the same, in four yearly instalments. Our central government can compensate the state governments for the loss in revenues caused by this waiver this year.

The increase in Centre's overall fiscal deficit, can be partially offset by increased collections of indirect taxes like GST and other state levies, besides unleashing other related multiplier effects in our economy, especially in terms of growth in employment and GDP.

These two measures as cited above, can be role-models for the rest of the world to emulate.

Main key to overall economic recovery..

Taming of oil prices via a deal with Iran is the main key to overall economic recovery in the world. With the US and Nato troops withdrawing from Afghanistan, Iran holds another key to ensure peace and stability in the region.

Time for some innovative diplomatic efforts by the US and its allies, as well as by India which has substantial interests in Afghanistan, to lift all sanctions on Iran and bringing it back to the mainstream of international relations.

This would also ensure that Iran floods the oil markets thereby breaking the power of Opec to hold the oil prices at such high levels, thereby jeopardizing the overall economic recovery of the world in such trying times.

Besides, Iran could be a frontrunner in keeping a watchful eye on Afghanistan which should not become am launching pad for terror activities in other parts of the world. This has to be avoided at all cost.

Re-imagining Facebook

My vision is to re-imagine 'Facebook' by making it the ‘first port of call’ for anyone seeking help, such as:

 

• An individual seeking employment opportunities, or fame, or recognition,

 

• Start-ups desirous of reaching out to potential investors or customer base in a highly cost effective manner, or

 

• Businesses seeking to reach out to their intended target audience through focused communication strategies etc.

 

This can be accomplished through some strategic initiatives, such as:

 

• Re-imagining recognitions and appreciations on one’ posts which currently are generally limited to ‘likes’ and ‘comments’ or ‘shares’ through one’s own circle of friends on Facebook. Let’s create a “Hall of Fame” on Facebook, where certain individuals or groups who have surpassed certain standards in their respective fields are granted recognition on this coveted platform,

   

• Re-imagining interactions in this platform which currently are limited to one’s circle of friends, except perhaps comments on certain news items by reputed publications. Let’s allow any worthwhile post to be accessed by even those who are not a part of one’s friend circle by creating a section where some worthy posts can be placed and viewed by any one who is interested. Certainly, this can facilitate interactions between those who are not connected to each other on Facebook,

 

• Re-imagining motivations to post something meaningful on this platform. Going beyond the number of ‘likes’ ‘comments’ or perhaps ‘shares’ of one’s posts from one’s own circle of friends. This unfortunately has started yielding diminishing returns, as it has been observed that some members have either reduced the frequency of their visits to Facebook or have discontinued their Facebook account altogether. As mentioned above, let’s allow any worthwhile post to be accessed by even those who are not a part of one’s friend circle by creating a section where some worthy posts can be placed and viewed by any one who is interested. Certainly, this can facilitate interactions between those who are not connected to each other on Facebook which can be an important motivator,

 

• Re-imagining the way businesses connect with their target audience. For example, by organizing contests on Facebook by such businesses, to guage extent of awareness or familiarity of sample of their target audience, their feelers, opinions, perceptions etc. with regard to the products/services of such businesses.  Attractive prizes could be sponsored for those members who offer useful insights and suggestions to such businesses,

 

• Re-imagining hiring techniques by some of the progressive corporates. For example by organizing contests on Facebook to guage the analytical abilities and attitudes of their potential talent pool. Such identified talent can serve as a valuable resource pool  for such progressive corporates who can be considered at an appropriate time, and

 

• Re-imagining talent contests for the entertainment industry on similar lines as above.

 

More of such innovative ideas can be deliberated upon.

      

 

"An Economic Strategy for India' - Some Thoughts

The report "An Economic Strategy for India' co-authored by some eminent economists including our former RBI Governor, Mr. Raghuran Rajan, has rightly suggested that our political establishment should desist from resorting to farm load waivers for political gains.

The report has endorsed the Telangana model of upfront cash support at the time of sowing -the Rythu Bandhu scheme as cure to farm distress, and handing out Rs. 4000 per acre to land-owning farmers.

Based on this limited information as reported in the newspapers, my thoughts are as follows:

a) Recent show of strength by some farmers who marched to Mumbai and Delhi, demanding loan waivers, is a matter of concern. But then what really are the concern areas, did those farmers participating in the march really represent the true nature of our agrarian distress and to what extent, and above all, would a single loan waiver for these very farmers cure all ills plaguing our agrarian sector? These questions need to be evaluated and brought to public discourse for an informed debate on the policy measures required for turning around our agrarian sector,

b) Telangana model has been feted by authors of this report. It would be worthwhile for our policymakers cutting across political ideologies,to institute a comprehensive study on the efficacy of such a measure, especially on the marginal farmers, who are most in need of remedial solutions,

c) Has any public sector bank or any financial institution done even a sample study on those farmers who have availed of loans, to verify if the amounts so disbursed to them have been spent judiciously and for the intended purposes? If so, what have been the findings of such a study?

d) How the farmers in Telangana deal with crop failures on account of various reasons, and what is the support mechanism evolved by the Telangana government for the same?

e) And finally, one of the key problems afflicting the agrarian sector is unfavorable prices for produce when compared to the price paid by the final consumers for the same produce. This needs to be fixed, and among the suggested of measures include breaking of the monopoly of APMC to procure agricultural produce, besides encouraging the industry to join hands with our farming community to ensure a win-win-win formula, that is a formula, which is beneficial to farmers, industrialists, and the final consumers.

All these are of tall order indeed, and would need the foresight of a statesmen at the helm of affairs, to take bold decisions for the benefit of our economy as a whole, key to which lies in our agrarian prosperity.

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Kartarpur Corridor event at Pakistan

In diplomacy, optics play a key role in forming overall perceptions of the intended audiences. And where optics are concerned, the historic Kartarpur Corridor event at Pakistan, was nothing short of a disaster.

No doubt Navjot Sidhu shares a good personal rapport with Prime Minister Imran Khan, and no one should have an issue if he wishes to take some credit for this historic event. But then, when our Union Cabinet had appointed two of our Union Ministers to grace the occasion, due importance should have been given to them. Imran Khan should have reserved his niceties for Sidhu to a low key, as he was on a private visit.

Secondly, let us not forget that this event was close on heels to the 10th anniversary of Mumbai attacks, and the perpetrators of such heinous attacks are yet to be brought to justice in Pakistan. How could an aide of one of the masterminds - Hafiz Saeed, was allowed to make an appearance and shake hands with Gen Bajwa? This optic has its obvious conclusions.

There is no point issuing such statements like, "If India takes one step forward to improve bilateral ties, Pakistan will take two", when actions and words in such an event were in stark contrast.

And at the very least, Sidhu should have politely countered his friend Imran Khan, that neither was he keen to contest elections in Pakistan nor was he aspiring to be our next Prime Minister right now. The fact that he did not do so, clearly puts a question mark on his intentions.

Going forward, let us remain optimistic about Prime Minister Khan being able to deliver on his intentions to mend fences with us. But at the same time, we also need to remain on high alert all the time to guard against any nasty surprises, as has happened in the past.

Finally, if by appointing Sidhu as our goodwill ambassador to Pakistan can make all the difference, then so be it.

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RBI and Finance Ministry

If the RBI's mandate is to ensure monetary stability, and Finance Ministry's mandate is to ensure fiscal stability, then can the monetary and fiscal stability co-exist without RBI and the Finance Ministry going hand-in- hand? Typical example, under normal circumstances, high taxes and less government spending should lead to lower interest rates to ensure the overall economic growth does not suffer.

Yes, there may be healthy differences between the two depending upon overall situation prevailing in the financial system as a whole. But at the end of the day, the Hon'ble Finance Minister is an elected representative of the people of India, and is answerable to our Parliament.

Thus, the top leadership of the RBI needs to be sensitive about the concerns expressed by the Hon'ble Finance Minister, and work out amicable solution/s to address the same.

High Oil Prices and Weakening Rupee- Options for India

The continuing mayhem in our stock markets, mainly due to sanctions on Iran by the US, resulting in higher crude prices and weakening rupee, needs to be viewed from the prism of wider geo-political implications. That this mayhem does not mirror the strong fundamentals of Indian economy at present is beyond doubt.

That higher crude prices driven by OPEC is not in the interest of even the US, is reflected by the following tweet from President Trump in April this year:

"Looks like OPEC is at it again. With record amounts of Oil all over the place, including the fully loaded ships at sea. Oil prices are artificially Very High! No good and will not be accepted!”

While abrogating the nuclear deal with Iran, as negotiated by his predecessor, President Trump made it clear that he was open to another such deal with Iran which according to him was just and fair.

Now, an opportunity for India in this crisis. We should:

a) Form a grouping of major oil importing countries as a counter to OPEC. The key objective of this grouping should include - setting an upper band of crude oil for OPEC, actively supporting each other to reduce dependence on oil imports from OPEC, and aggressively working on increasing the usage of alternative fuels and and associated technologies, besides assisting each other in oil exploration projects. Such a grouping is likely to have its impact on OPEC, by reducing their scope of maneuverability in raising oil prices. If nothing else, it is at least likely to bring differences of opinion in OPEC which is not a monolithic entity, and

b) Having good relations with both US and Iran, we should work aggressively on back channel diplomacy with both, to arrive at a win-win nuclear deal, which will assuage the concerns of Trump administration on the deal entered by Obama administration. Yes, this may mean tweaking some clauses of that agreement over which Trump administration has concerns. This would necessitate some quid-pro-quo by the US as well, but that would be in the its interests as well, if unlimited transfer of incomes from major oil importing countries including the US, to OPEC via reduced oil production and high oil prices has to be kept under check.

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