ranjan

History suggests that countries which have adopted moderate and progressive outlook have made faster progress than those which have taken an authoritarian and insular turn. Price stability is the best contribution that monetary policy can make to economic growth and job creation. Inflation is caused by the failure of aggregate supply to equal the increase in aggregate demand. Therefore, inflation can be controlled by increasing the supplies of goods and services and reducing money incomes in order to control aggregate demand.  Inflation or persistently rising prices is a major problem in India today. Due to inflation, value of money falls and the people need more money to buy goods and services. In order to exercise control on inflation, following two systems, if implemented, shall not only leave more purchasing power in the hands of public by saving money but control inflation for a long time to come. 1. Stop giving subsidies/grants on essential commodities, rather supply few of s...

The word 'Attitude' comes from the Italian for 'Posture' means it is how you carry yourself, something you hold in your whole being, your entire approach to the world.    Attitude is a reflection of a character's motivation which expresses itself in a positive or negative manner. Emotional reactions and resulting behavior stems from a character's attitude. The attitudes can change over time, and the adjustment usually occurs with a new understanding or a different environment. Nothing can stop the man with right mental attitude from achieving his goal, nothing on earth can help the man with the wrong mental attitude. Attitude is a little thing that makes a big difference.      Attitude allows to categorize or group objects as a way of knowing about them. Thus, when a new object is experienced we attempt to categorize it into a group of which we know something about. Of course, there is some risk of error in not looking at the unique aspects or new information ab...

Saffron is the most expensive spice in the world and it is derived from the dry stigmata (thread like parts of the plant) "Crocus Sativus"- Popularly known as "Red Gold", Kesar,  Zafran.  Saffron can be grown  anywhere in the world and growing it is very simple and accessible to anyone. Generally, Saffron price depends on the intense labor needed to harvest the crop, not because it is difficult to grow.  Saffron is mainly used in culinary seasoning and to get color, Cottage Cheese, Biryani, Meat, liquors, Cakes, Confectioneries, Breads and Mughlai dishes. It is commercially used in perfumes and cosmetics. For medicinal use, it is used in fevers, Ayurvedic treatment to heal arthritis, impotence and infertility.  In Saffron farming, the kind of soil is more important than the climate of the area where it is intended to be grown. Saffron thrives best in warm sub-tropical climate and can be at 2000 meters of main sea level. An optimum period of 12 hours Sun light is...

Fiscal adjustment policies should be designed within an overall methodological framework that links the implementation of a set of policy measures to the achievement of the economy's objectives for inflation, growth, and external balance. Rebalancing growth towards domestic demand has emerged as a key post crisis for sustaining developing a country's  rapid growth in the medium and the long term. What matters most for rebalancing are specific fiscal measures tailored to each country's unique circumstances. The primary contribution of fiscal policy is to help remove the structural impediments and distortions that stand in the way of (i) a better balance between external and domestic demand and (ii) a better balance being production for both domestic and foreign markets. In this context, the composition of public spending matters in the rebalancing process.  Specific areas of government expenditure are health, education pensions and social protection. The shifting of public e...

The partition of India which gave birth to the world's largest democracy, left a devastating legacy and scars that refuse to heal. Even after 72 years and three generations, a part of legacy still within us, the remnants of the separation still haunts us. The competing political narratives surrounding the partition have continued to keep the root cause of the historical event a matter of dispute. However, personal memoirs are clear cut, as all of them - without exception- are full of stories of  shock, loss, grief and acceptance.     Based upon the happenings and memories gathered from my Grand Father, Grandmother and my beloved parents,  I make an effort here to mention a few memories.      My Grandfather,  third son of a wealthy business family had two brothers and one sister  born in Rawalpindi, stayed in a grand house, owned horse bogeys and used to spend summers in Murree, a potential hill station near Rawalpindi. The business inter...

The Indian Independence Act 1947 is an Act of the parliament of United Kingdom that partitioned British India two new independent dominions of India and Pakistan.  The Act received Royal assent on 18th July 1947 and thus, India and Pakistan, comprising West (modern day Pakistan) and East (modern day Bangladesh) regions, came into being on 14th August. The legislature representatives of Indian National Congress, the Muslim League and the Sikh Community came to an agreement with Lord Mountbatten on what has come to be known as 3rd June plan or Mountbatten plan - last plan for independence.   Lord Mountbatten ( a cousin of the king of England) created Boundary Commission in July 1947, about five weeks before were scheduled to depart from Indian subcontinent. Sir Cyril Radcliffe, a British lawyer was commissioned to recommend how the Punjab and Bengal regions of Indian subcontinent were to be divided between India and Pakistan before each was to become independent from Britai...

The pandemic stuck a global economy that already was profoundly unsustainable - Socially, Environmentally and even intellectually. Policymakers' choices during this disruption could shape their economies for decades to come. Over the past four decades, almost all advanced economies have become more polarized, with increasingly unequal income distributions. Developing economies lifted billions of people out of poverty, but in the process they, too, created their own rising inequalities and social tensions. The global economy's lopsided growth has brought us to the edge of catastrophic climate change.  The political upheavals in one country after the another meant the world could not expect to go on as before. Then the coronavirus brought the most dramatic societal disruption and economic collapse in peacetime memory. The enormity of the crisis made unintended radicals out of many political leaders as they intervened drastically in economic activity and took the risks of both wor...

The crisis was caused by currency overvaluation, current account deficit and investor confidence played significant role in the sharp exchange rate depreciation. The economic crisis was primarily due to the large and growing fiscal imbalances over the 1980s. During mid-eighties, India started having the balance of payments problems. Whether one goes by data or anecdote, that the Indian economy has been experiencing a contraction- rather than growth - since March 2020 has been evident from all accounts. It has been almost six months since the crisis broke, we are no longer using the strange term "negative growth" and are getting used to calling the change in GDP for what it really is: contraction.  Of course, the Covid-19 crisis is not unique in India. It is a global shock that is playing havoc in the world. So, in order to have a sense of how bad the economic impact has been, we should compare India with other countries. Much of the recovery in the later months of 2020 has be...

Faith or Blind faith - common between two is trust, acceptance and belief. But, there is                 a fundamental difference. In blind faith, you accept something without giving any thought to it, whereas faith is a result of your choice, reflection. The result of faith determines whether your faith is right or blind. If you are getting transformed heading towards the truth, then that is right faith, and if your inner state is deteriorating, know that your faith is blind.    Generally, Faith is verified based on the one you have faith in. If you faith in someone who is not worthy, people say you have blind faith. But whether that person is worthy or not, what is important is, is your faith genuine? So faith is determined by the one who has faith and not the one in whom he has invested his faith.             Faith is subjective, not objective. If you have faith in stone, and if it is helping in...

Post-independence India adopted a very conservative economy that was practically shut to the outside world. But, with the passage of time Indian leaders and economists recognized the need to merge with the global economy. So in 1991, India went through some major reforms, of which the privatization is a prominent one.  Privatization is the process of shifting the control of certain industries from public sector to private sector partly or completely. It was first world nations that came up with the concept of privatization with the aim of improving the condition of services offered by certain industries besides lowering the burden of Government. However, developing nations such as India also took a cue from these countries and privatized various sectors.  Many studies have demonstrated that privatization did not contribute to growth but helped to reduce income inequality, inflation contributed negatively to both economic growth and income equalization. Moreover, privatization ...

The increasing global burden of private debt is largely is due to combination of business debt and household debt. Even though government debt grabs all the headlines, private debt is larger than government debt and has more impact on economic outcomes. Debt is a two-edged sword. Used wisely and in moderation, it clearly improves welfare. But, when it is used imprudently and in excess, the result can be disaster. For individual households and firms, over borrowing leads to bankruptcy and financial ruin.  When a private debt is high, consumers and businesses have to divert an increased portion of their income to paying interest and principal on that debt resulting into less spending and investment. That is a real part of what is weighing on economic growth. After private debt reaches high levels, demand gets suppressed. Most middle and lower income households (where the highest rate of debt growth has been) as also most small and medium sized businesses, pay much higher rate of inte...

Creating digital markets and boosting digitization can yield significant economic benefits and lead to substantial social benefits to societies and communities. Digitization is emerging as a new tool to build and sustain such absolute advantages, and in some cases even to claim the right to win and beat competition in certain sectors - a critical capability that underpins all other national economic efforts. Digitization has the potential to boost productivity, create new jobs, and enhance the quality of life for society at large. If emerging markets could double the digitization index for their poorest citizens over the next 10 years, result would be a global $4.4 Trillion gain in nominal GDP, an extra $930 billion in the cumulative household income for the poorest, and 64 million new jobs for today's socially and economically most marginal groups which will enable 580 million people to climb above the poverty line. If policymakers want to capture these rich returns, then they nee...

China stunned the world's financial markets in August 2015 by devaluations of yuan  knocking off 3% of its value. The move was unexpected and many believed it was a desperate attempt by Chine to boost exports to support the economy which was growing at its slowest rate in decades.     There was another motive for China's decision to devalue the yuan i.e. China's determination to be included in the IMF's special drawing rights (SDR) basket of reserved currencies. The SDR is an international reserve asset that IMF members can use to purchase domestic currency in foreign exchange markets to maintain exchange rates. IMF reevaluates this currency composition in SDR basket every five years. In 2010, yuan was rejected on the basis that it was not freely usable. Later, IMF welcomed the devaluation since it was claimed of being done in the name of market-oriented reforms. Consequently yuan became part of SDR in 2016.  Within the basket, Chinese renminbi (system of curren...

With millions of jobs lost, robots on the rise, and white-collar workers toiling largely at home, COVID 19 appears to have ushered in a new normal in the global workplace. Many of these developments stem from failed policy responses to mega trends already in motion long before the pandemic struck. At least for the last two decades, shifting demographics and technological upheaval have been upending labor markets, to make something worse inequality, jobs increasingly precarious and deepening insecurity.  In addition, a deadly virus has simply accelerated the pace of change, with devastating consequences - especially for developing economies, which are expected to lose at least $220 billion in income. So, the politicians must pursue a dramatic course correction than previously considered. Some jobs will disappear and others will emerge as the world faces a dual disruption. This year, following are the five things which we need to know to shed light on the effect of pandemic related d...

Micro finance is an emerging concept which plays a vital role in the development of low income groups. It acts as building block of our economy. It saves people from the inflating rate of interest. It also has certain shortcomings which must not be overlooked in a developing country like India.  India's annual budget is first a macroeconomic exercise and then a micro one catering to sectors of the economy. Micro budgeting is considered as traditional budget. Micro budgets are a great tools but there are certain flaws in them as mentioned hereunder - In order to do this, one has to spend time looking carefully at spending, dividing into small categories and coming up with realistic targets. This have to be done every month over and over again which adds up to quite a lot of time. Second, it can be pretty inflexible. An unexpected expense can wreck a micro budget making one has to feel like a failure at the end of month. There are life events which one cannot simply control, and micr...

Growth of service sector in India is a unique example of leap - frogging traditional models of economic growth. Since independence, the contribution of service sector in India to the country's GDP is a lion's share of over 60%. Since it employs only 25% of the labor, agriculture and manufacturing has not yet risen to its full potential.   The service sector in India becoming the mainstay of not only for growth in GDP but also a  key vehicle for employment generation. This sector is of soft parts of the economy such as activities where people offer their knowledge and time to improve performance, productivity, potential and sustainability. India's service sector has been the powerhouse of the country's economic growth.                Services contribute massively to India's integration with world markets through trade and FDI flows. Growth has been rapid in Software, Business, Communications and Financial services among others. The s...

The two self-governing countries of India and Pakistan came into existence at the midnight of 15 August 1947. The British system of political control hinged on identifying groups willing to collaborate, a governing style described as "Divide and Rule". The prospect of losing this protection as independence drew closer worried at around 25% of population (Muslims), first in parts of northern India and then, after World War II, in the Muslim majority provinces of Punjab and Bengal. In 1945-46, All India Muslim League led by Muhammad Ali Jinnah won majority of Muslim votes in provincial elections. This strengthen the party's claim to speak for a substantial portion of, but never all, the subcontinent's Muslims.   The biggest problem after partition was the division of a rupees 55 crores payable as the latter's share of assets. The second was Refugee problem. India was hopelessly poor as a result of steady de-industrialization by Britain. The abject poverty and sharp ...

Agriculture is central to the Indian economy. In India, about 80% of farmers are smallholders -which is generally considered to mean that they have two hectares or less of land. More is needed to be done since crop yields in India are still 30% to 60% of the best sustainable crop yields achievable in the farms of developed and other developing countries. Poor infrastructure and unorganized retail means India has one of  the world's highest levels of post- harvest food loss.  It is now a time for change. We must be prepared to face long outstanding issues and new realities. Natural resources on which agriculture is based - Land and Water, above all, are being degraded and there is growing competition for their use. Climate change is already severe and aggravate this situation, making agriculture more risky, will have even greater impact in future.  In such context, public-private partnership (PPP) model be the game changer India's agriculture sector needs.With the Governme...

Google has an Adsense site offering the  public to have a blog on the same and start writing on it. They also have stated of a system of payment to the subscriber. But after a certain time, they disable the blog account. No intimation is sent to the subscriber to inform him of the same.    No system exists as how the publisher should approach them for getting the blog activated. As per practice, they do not bother even to reply to the requests made by the subscriber .  Purpose of this is only to know the facts for information so that one can think of whether to continue or close the blog.                                                     ***************

Since the beginning of mankind, Pandemics and Epidemics have had a profound economic and societal impact. But if there is one thing that stands out through all of this, it is that human resilience and adaptability is outstanding, knowing no bounds and various examples from history are a testament to that. From the Black Death to the Spanish Flu and the recent SARS outbreak, the response and impact of entire economies hold valuable lessons.Though different in magnitude, past can give some profound knowledge and guidance with indicators about the performance of the world economy and the resulting impact due to the coronavirus outbreak.  PAST EPIDEMICS - The Black Death -1348 -1350 - Casualty - 50 million  The Black Death arrived in 12 ships in the port of Italy in 1347. Increasing modernization and stability in Europe led to extensive trade between East and West Europe itself. Cities like Venice and Geneva, located at trading docks became wealthy. The epidemic spread rapidly thr...