Indian growth narrative of 7% GDP has done real damage

News Network
June 14, 2019

Jun 14: For four years, India has battled the suspicion that its new and improved GDP series is a rose-tinted view of reality. Now that Narendra Modi is prime minister for a second term, he must see that battle for what it is: a lost cause. Unlike harmless advertising puffery around a toothpaste that kills 99.9% of germs, the narrative of 7% growth has done real damage. This week, a top former government adviser provided a statistical estimate. The actual GDP growth rate between 2012 and 2017, according to Arvind Subramanian’s working paper for Harvard University, may have been 2.5 percentage points lower than the official 7% rate.

India’s level of economic output may be overstated by anywhere between 9% and 21%. The issue isn’t whether Subramanian’s technique of looking at other countries’ performance to build a picture of India’s growth is robust. As my colleague Mihir Sharma argues, if senior officials who served Modi in his first term don’t believe the data, nobody else will trust them either.

Going by the early official response to the critique, especially the promise of a point-by-point rebuttal to come later, it’s clear that Team Modi wants to continue to brazen it out. The prime minister should see the economic cost of that approach, even if his advisers don’t.

Voters don’t care about abstract statistical artifacts like GDP. They care about jobs, state subsidies and programs, and the cost of living. It was India Inc. that bought into the claim of 7% growth, and found itself badly deceived when the expected operating profits to repay creditors never materialized. Investments had stalled even before Modi’s first term, but the deleveraging that was badly needed to deal with a slowdown also got delayed.

Misleading GDP data is one of several reasons why most balance sheets in India are stressed today. It’s not surprising, therefore, that the most ardent supporters of the new GDP series are accountants by training. When 108 economists and social scientists wrote to the government asking it to restore sanity to the published figures, 131 accountants wrote their own letter, accusing the former group of running a politically motivated campaign.

India’s bean counters do have a dog in the GDP fight. Some of them, as fund managers, have given investors’ money to firms that are in deep trouble now. Others, as auditors, turned a blind eye to sharp corporate practices, related-party lending and self-dealing, perhaps thinking that all boats would be kept afloat by high growth. Now they’re scared.

Naturally, financial intermediaries in Mumbai don’t want Modi to tell creditors and debtors the truth about growth, especially since they can’t undo their previous bets on 7% expansion without career-limiting, wealth-destroying – and possibly even freedom-endangering – consequences. But if Modi doesn’t order a thorough revamp of the discredited data in his second five-year term, the danger is that every quarterly growth announcement from now on will be discounted by 2.5 percentage points – the Subramanian factor. That means asking investors to accept that the March quarter’s published 5.8% GDP expansion – a fourth straight quarter of cooling – may have been as low as 3.3%.

Who will invest in a labour-surplus nation at those near-recessionary growth rates?

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News Network
January 9,2020

Srinagar, Jan 9: Envoys from 15 countries including the United States were shown around Srinagar on Thursday, the first visit by New Delhi-based diplomats since the government stripped Kashmir of its semi-autonomous status and began a harsh crackdown five months ago.

The diplomats were driven by Indian authorities in a motorcade amid tight security from the airport to the military headquarters in Srinagar, where they were briefed on the security situation, an army officer said. He spoke on condition of anonymity as he was not authorized to speak to reporters.

They also held discussions with civil society members and some Kashmiri politicians, said Raveesh Kumar, spokesman for the Ministry of External Affairs (MEA).

The objective of the visit, organized by the Union government, was for the envoys to see first-hand “how things have progressed and how normalcy has been restored to a large extent'' in Kashmir since August, Kumar told reporters in New Delhi.

In October, a group of European Parliament members had visited the region, which is claimed by both India and Pakistan.

The delegation that visited Kashmir on Thursday included US ambassador to India Kenneth Juster and diplomats from Bangladesh, Vietnam, Norway, the Maldives, South Korea, Morocco, Niger, Nigeria, Argentina, the Philippines, Fiji, Uzbekistan, Peru and Togo.

Offices, shops and businesses were open in Srinagar on the cold winter day, but the diplomats did not stop to talk to people as they moved to different venues of their meetings.

They were to fly to Jammu, the winter capital of Kashmir, later Thursday and return to New Delhi on Friday.

Congress leader Jairam Ramesh pointed out the oddity of taking foreign diplomats to the troubled state but not allowing allowing Indian political leaders to freely visit it.

The National Conference said it was "disappointed" with the way the government brought envoys from various countries to "endorse" its "claims of normalcy" in the union territory. The party alleged that it was no more than a "guided tour" with access limited to "handpicked individuals who toe the government line".

“The NC wishes to ask these envoys that if the situation in Jammu & Kashmir is "normal", then why are scores of people, including three former chief ministers, under detention for almost 160 days and why have the people been denied access to the internet for over 5 months?" a statement issued by the party said.

Kumar dismissed as unfounded criticism of the visit, and said more such visits to Kashmir by New Delhi-based diplomats are likely in the near future.

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News Network
January 17,2020

Jan 17: India's "high power" communication satellite GSAT-30 was successfully launched in the early hours of January 17, the Indian Space Research Organisation (ISRO) said.

The satellite, aimed at providing high-quality television, telecommunications and broadcasting services, was launched onboard Ariane 5 rocket from French Guiana.

Blasting off from the Ariane Launch Complex in Kourou, a French territory located in northeastern coast of South America at 2.35 am IST, European space consortium Arianespace's Ariane 5 vehicle injected GSAT-30 into the orbit in a flawless flight lasting about 38 minutes.

Arianespace CEO Stéphane Israël tweeted about the successful launch of GSAT-30.

ISRO's U R Rao Satellite Centre Director P Kunhikrishnan, who was present in Kourou, congratulated the ISRO community and Arianespace team on the successful launch.

Calling it an "excellent start" to 2020 for ISRO with the launch, he said, "The mission team at the master control facility have already acquired the satellite and they will immediately complete the post launch operations...."

The 3,357-kg satellite, which was deployed from the lower passenger position of Ariane-5 launch vehicle (VA 251) into to geostationary transfer orbit (GTO), is configured on ISRO's enhanced I-3K Bus structure to provide communication services from Geostationary orbit in C and Ku bands.

The satellite derives its heritage from ISRO's earlier INSAT/GSAT satellite series, and is equipped with 12 C and 12 Ku band transponders.

GSAT-30 is to serve as replacement to the "aging" INSAT-4A spacecraft services with enhanced coverage, ISRO has said, adding the satellite provides Indian mainland and islands coverage in Ku-band and extended coverage in C-band covering Gulf countries, a large number of Asian countries and Australia.

With a mission life of 15 years, GSAT-30 is an operational communication satellite for DTH, television uplink and VSAT services.

The Bengaluru-headquartered ISRO has said the communication payload of GSAT-30 is specifically designed and optimised to maximise the number of transponders on the spacecraft bus.

According to the space agency, the spacecraft would be extensively used for supporting VSAT (Very Small Aperture Terminal) network, television uplinking and teleport services, digital satellite news gathering (DSNG), DTH television services, cellular backhaul connectivity and many such applications.

One Ku-band beacon downlink signal is transmitted for ground-tracking purpose, it added.

For its initial flight of 2020, Arianespace on its website said, it would orbit EUTELSAT KONNECT, a telecommunication satellite for the operator Eutelsat, along with GSAT-30, using an Ariane 5 launch vehicle from the Guiana Space Centre.

EUTELSAT KONNECT – which was produced by Thales Alenia Space for Eutelsat – was riding in the upper position of Ariane 5's payload arrangement, and was released first in the flight sequence at 27 minutes following liftoff.

Since the launch of India's APPLE experimental satellite on Ariane Flight L03 in 1981, Arianespace has orbited 24 satellites, including GSAT-30, for the Indian space agency.

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News Network
January 31,2020

Jan 31: President Ram Nath Kovind on Friday hailed the contentious Citizenship Amendment Act as "historic" in his address to joint sitting of both houses of Parliament, prompting protests by some opposition members.

He also said that debate and discussion on any issue strengthens democracy while violence during protests weaken it.

"The Citizenship Amendment Act is a historic law. It has fulfilled wishes of our founding fathers including Mahatma Gandhi," he said.

"Debate and discussions strengthen democracy, but violence during protests weaken democracy," he said without directly referring to the anti-CAA protests in the country some of which have witnessed violence.

In a reference to abrogation of Article 370, Kovind said there is happiness among people of India that people in Jammu and Kashmir and Ladakh have got rights on par with the rest of the country.

The president said Parliament has created record in the first seven months of the new government headed by Narendra Modi by enacting several landmark legislations.

"My government is taking strong steps for making this decade as India's decade and this century as India's century," he said.

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