Archives  >  2019  >  October  >  2nd

India’s Economic Troubles

1. What’s the story?

The nation’s biggest festive season may be around the corner, but India’s money troubles don’t seem to be ending anytime soon. In September, GST collections fell to a 19-month low, car sales remained dismal, Sensex decreased by 700 points, and the nation’s growth forecast was cut by almost 1%. In addition, Bangladesh’s economic growth may surpass that of India soon – adding to the latter’s woes. (Quick recap: The Goods and Services Tax or GST is an indirect tax imposed in India on the supply of goods and services.)
Tell me more.

Maruti Suzuki and Tata Motors – the two leading automobile manufacturers in the country reported decreasing sales in September.

Sales of vehicles across the automobile sector continued their slide in September with the leading manufacturers of passenger vehicles, two-wheelers, and medium and heavy commercial vehicles reporting a sharp fall in their year on year domestic sales last month.

What started as a problem on account of funding and liquidity squeeze in July-August 2018, has now become more of a sentiment issue with individuals looking to postpone and cut down on consumption expenditure.”

On Tuesday evening, the Indian Government also released data that admitted that GST collection had decreased from approx. INR 98 crore in August to approx. INR 92 crore in September.

Generally-speaking, collections of over Rs 1 lakh crore a month are seen as healthy.  The dip in September is, therefore, reflective of the larger slowdown in the Indian economy.”

According to experts much of the panic in the market is due to the ongoing crisis at the Punjab and Maharashtra Cooperative (PMC) Bank, that 6 Things covered here. The bank, that is reeling under strict regulatory notices since last week, “…is providing a glimpse of how the liquidity and debt crisis in India’s real estate sector could very easily spread and spiral out of control.”

At least 21,049 dummy accounts were used by the Punjab and Maharashtra Co-operative Bank to hide accumulated non-performing assets of realty firm Housing Development and Infrastructure Limited (HDIL), revealed suspended PMC bank managing director Joy Thomas’s letter.

His confession letter to RBI also revealed that the bank’s exposure to bankrupt HDIL has been pegged at Rs 6,500 crore, which is 73 per cent of the bank’s total assets.”

Additionally, “…the latest economic outlook update released by the Asian Development Bank has shown how Bangladesh, and not India, is the standout economy in terms of growth momentum in South Asia.

The structure of Bangladesh’s economy is quite different from India’s. Unlike India, where the services sector contributes overwhelmingly while industry’s contribution is much lower than desired, Bangladesh … has a booming industrial sector.

This allows its economy to create jobs. In India, by contrast, the bulk of the population is still stuck in the agriculture sector, which contributes the least to the GDP. The industrial sector, which has the maximum potential to absorb surplus labour from agriculture, is struggling to grow fast enough and create employment.”
So, what now?

Prime Minister Modi is set to meet representatives of the Finance Ministry soon, and take a call on how to stimulate the stagnating economy. As part of this move, the Indian Railway Catering and Tourism Corporation (IRCTC), is being thrown open to the public. The Government is hoping to earn more than INR 600 crore by selling 20 million shares of this flagship institution.

“The Indian Railways, though, will not receive any proceeds from the IPO of its catering, tourism, and ticketing arm.”
Watch this space. We’ll keep you updated.

2. Where else should I be looking at?

The National Law Universities, that’s where.

“Five national law universities of India have come together to set up a legal aid clinic to provide assistance to persons excluded from the National Register of Citizens (NRC) in Assam, Live Law reported.

Over 19 lakh people were excluded from the final NRC which was published on 31 August.

The legal aid clinic Parichay has been set up as a collaboration between Assam’s National Law University and Judicial Academy, West Bengal National University of Juridical Science Kolkata, Hyderabad’s NALSAR University of Law, Delhi’s National Law University, and Odisha’s National Law University, in order to assist lawyers in drafting appeals on behalf of litigants.

Under the initiative, volunteers across the country will collaborate with civil society to provide legal aid to those excluded from the final Assam NRC and assist in training lawyers and paralegals.”

(Quick recap: The National Register of Citizens or NRC is supposed to be a register containing the names of all genuine Indian citizens. It first came into being during the 1951 Census. It was recently updated in the state of Assam – the final list leaving out around 19 lakh people.)

3. What more?

The villagers of Ratnagiri are slowly starting to live with (and avoid) the venomous Russell’s viper. For hundreds of years, local people had killed these snakes on sight – but one researcher is currently trying to change this mindset.

“Gerard Martin studies a species that won’t win even a rigged popularity contest. Russell’s vipers have a reputation for being irritable. Like other vipers, they tend to freeze rather than flee in encounters with people. Besides these traits, their enormous venom glands and half-inch-long fangs make for a lethal combination. The species bites more humans than cobras in parts of India.

Martin and his team talked to the rural community of Ratnapuri, near Mysuru, Karnataka, about conducting a study. For hundreds of years, the locals had killed serpents on sight. He told them, “But that hasn’t stopped people from getting bitten. We want to see if there’s a better way of coexisting with snakes.” Intrigued, the villagers agreed.”

4. Anything else?

We’ve been talking a lot about Greta Thunberg – the teenage climate activist from Sweden who has taken the world by storm. But let’s not forget our homegrown activist – eleven-year-old Ridhima Pandey – who is also taking on Governments in search for a better tomorrow.

“Eleven-year-old Ridhima Pandey is one of the 16 petitioners who filed a complaint to protest the lack of government action on the climate crisis at the UN Climate Action Summit.”

Haridwar native Ridhima Pandey minces no words when she talks about the environment and blames the government for the current scenario.
“Our government is working on paper, less on the ground,” Ridhima told PTI.

On the issue of Ganga cleaning, Ridhima claimed that not much progress is visible on the ground. A vast amount of waste, including polythene bags, garbage and industrial effluent, goes into the river untreated and there is total apathy on the part of the authorities, she added.”

5. Is that all?

2nd October is Mohandas Karamchand Gandhi’s birthday. “The story of how Mohandas Karamchand Gandhi became a Mahatma has inspired millions all over the country – rather, all over the globe.

Now as old art forms like the dastangoi find their way out” … take a look at  Dastaan-e-Gandhi, the story of Bapu’s return to India and his journey from being an ordinary mortal to the Mahatma.”

[Quick recap: “…a dastaan is a verbally recited epic that has its origins in dastangoi – a 13th century Urdu storytelling art form performed by a skilled dastango (storyteller) ]

6. Before you leave…

Take a look at how Tibetans in India are joining the Global Climate Strikes to “bring attention to their burning homeland.”

“For most Tibetans, the political and the personal are often indistinguishable. For over the last 60 years, India has seen one of the largest populations of Tibetans who’ve left their homeland to escape political oppression by China. There have been reports on human rights violations as well as those on land grabbing for construction projects in Tibet Autonomous Region and other Tibetan areas, along with mining on Tibetan sacred mountains. And then there are reports showing an overwhelming increase in the melting glaciers, snow, ice, and permafrost that is projected to increase natural calamities such as avalanches, rockfalls, floods, and landslides.”

Special note: 6 Things is off on its Durga Puja vacation from tomorrow. We’ll be back on the 11th with more interesting stuff. Till then, stay informed, stay cool.

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