Haq's Musings

Riaz Haq writes this data-driven blog to provide information, express his opinions and make comments on many topics. Subjects include personal activities, education, South Asia, South Asian community, regional and international affairs and US politics to financial markets. For investors interested in South Asia, Riaz has another blog called South Asia Investor at http://www.southasiainvestor.com and a YouTube video channel https://www.youtube.com/channel/UCkrIDyFbC9N9evXYb9cA_gQ

Saturday, March 11, 2023

Guess Why Pakistani Analyst Uzair Younus is Making Headlines in India!

Pakistani analyst Uzair Younus has recorded personal impressions of his recent India visit on his YouTube channel, as well as in an interview on another YouTube channel called "Pakistan Experience". Indian media have gleefully jumped on it with headlines like "Visiting India Was Like Stepping Into The Future" and a "Pakistani analyst" talking of India's "communal harmony". It has helped Younus' channel draw its highest ever views, and inundated it with Indian trolls' comments praising Hindu Nationalist Prime Minister Narendra Modi and denouncing Pakistan. This is yet another confirmation of what former US President Barack Obama wrote in his book "A Promised Land": “Expressing hostility toward Pakistan was still the quickest route to national unity (in India)”.

Indians See Uzair Younus Endorsing Indian PM Modi's Policies

Digital Payments:

Younus' "stepping into the future" comment refers primarily to the ubiquity of QR codes for retail digital payments that he observed in India. He said the currency in circulation accounts for 13% (actual: 13.7%) of India's GDP, versus 20% of GDP (actual: 18%) in Pakistan. He also saw the GST (Goods and Services Tax) numbers displayed at all retailers, and the GST taxes being paid everywhere.

Pakistan's RAAST P2P System Taking Off. Source: State Bank of Pakistan

There's no question that India has made significant strides in digitizing payments in recent years. However, it should be noted here that Pakistan, too, is making progress in digital payments. Raast, Pakistan's P2P payments equivalent of India's UPI, has crossed Rs. one trillion mark in payments in 11 months, according to the State Bank of Pakistan. Pakistan is also among the world's top 10 smartphone markets.

Pakistan Among World's Top 10 Smartphone Markets. Source: NewZoo

Infrastructure:

Younus also praised India's growing infrastructure and compared it with Pakistan's, claiming that the Pakistani infrastructure is better but it only serves the rich. He cited the example of driving time to Islamabad International Airport (serving 5 million population in the metro area) in Pakistan being much shorter than the driving time to Delhi Airport (serving 33 million+ population in the metro area) in India, claiming that it is because only the rich use the Islamabad Airport. This makes me wonder if the 5 million passengers who traveled in and out of Islamabad last year are all rich?

Communal Harmony:

Uzair cited the example of a Muslim peer's shrine in Rajkot being looked after by Hindus which the Indian media interpreted as "communal harmony" in its reporting. The fact is that India is ranked as the world's worst in terms of religious hostilities, particularly against Muslims, according to a Pew Survey. Scoring a high 9.5 on a scale of 10, India’s score is found to be worse than all the South Asian countries, including Pakistan, which scores 7.7, followed by Bangladesh 7.2, Afghanistan 6.5, Burma (Myanmar). 5.9, Sri Lanka 5.6, Nepal 2.6, China 1.3 and Bhutan 0.4.

India Tops Social Hostilities. Source: Telegraph India

National Debt and Deficits:

Uzair Younus argues that the Indian infrastructure is not built with loans while Pakistan takes on debt to build its infrastructure. It seems that the esteemed Pakistani analyst is unaware of the fact that India is the world's biggest borrower of infrastructure loans from various international financial institutions such as the World Bank, the Asian Development and the Asian Infrastructure Investment Bank.

India's external debt to GDP ratio is about 20% while Pakistan's is 34%. In addition, both India and Pakistan also run twin deficits: budget deficit and current account deficit (CAD). India's fiscal deficit is about 6.4% and its CAD is 3.3% of GDP. Corresponding figures for Pakistan are 7.9% and 4.6%.

India has perennially run huge trade and budget deficits. But substantial western capital inflows since the end of the Cold War have helped India avoid a balance of payments crisis. So, India's economic success is in part due to the change in global geopolitics in this century. In short, the West, led by the United States, is boosting India to counter China.

India is now emerging as the biggest beneficiary of the Ukraine War and the US efforts to check China's rise. Indian businesses are busting US sanctions to take advantage of the vacuum left in Russia by the exit of western businesses since the start of the Ukraine War. At the same time, the US is rewarding India by promoting it as an alternative to China in the global supply chain. Meanwhile, Beijing is warning New Delhi that India "will be the biggest victim" of America's "proxy war" against China.

Women at Work:

Younus saw many women at work in Indian cities, some engaged in constructions, other riding scooters to work. He compares it to what he perceives as absence of women in the workplace in Pakistan. What he misses is the fact that the female labor participation rate in India is, in fact, lower than in Pakistan, according to the International Labor Organization data.

Female labor force participation rate in India has recently fallen to just 19%, the second lowest after Afghanistan's 15% in the South Asia region. By contrast, Pakistan's women's labor force participation rate is 21%, Sri Lanka's 31% and Bangladesh's 35%. Prime Minister Narendra Modi's mishandling of the COVID19 pandemic has hit Indian women particularly hard, with 90% of those who lost their jobs now shut out of the workforce.

Female Labor Force Participation Rate in South Asia. Source: World Bank

The precipitous loss of women workers is disastrous news for India's economy, which had started slowing before the COVID19 pandemic, according to a Bloomberg report. Rosa Abraham, an economics professor at Azim Premji University in Bengaluru, tracked more than 20,000 people as they navigated the labor market during the pandemic.. She found that after the first lockdown, women were several times more likely to lose their jobs than men and far less likely to recover work after restrictions were lifted. "When men are faced with this kind of a huge economic shock, then they have a fallback option," Abraham told Bloomberg. "They can navigate to different kinds of work. But for women, there is no such fallback option. They can't negotiate the labor market as effectively as men do."

Optimism:

Based on the small sample of people he met in India and Pakistan, Uzair concludes that people in India are very optimistic while those in Pakistan are despondent. Results of a recent Gallup International Poll of 64 nations differ from his conclusion.

Doing Better Than Parents. Source: Gallup International

Pakistan is in the middle of multiple serious crises. But the vast majority of Pakistanis feel that they have better lives than their parents did, and they think their children will have even better lives than theirs, according to a Gallup International Poll of 64 countries conducted from August to October last year. The poll asked two questions: 1) Do you feel your life is better, worse or roughly similar to that of your parents? and 2) Do you think your children will have a better, worse or roughly the same life as you? The answers to these questions reveal that Pakistanis are among the top 5 most positive nations among 64 countries polled by Gallup International. Anecdotal evidence in terms of packed shopping malls and restaurants in Pakistan's major cities confirms it. Such positivity augurs well for Pakistan's prospects of successfully dealing with the current crises. It will drive the nation's recovery.

Nearly two-thirds (65%) of Pakistanis said they live better than their parents did. And 69% of Pakistani parents think their children will have better lives than they do. In neighboring India, 54% of respondents feel their lives are better than their parents' while only 43% say their children will have better lives than theirs'. The global average for the former is 51% and it is 44% for the latter. The poll results put Pakistanis among the world's five most hopeful nations.

Uzair Younus' Background:

Uzair talks about his family's humble beginnings in a small Gujarati village near Rajkot which he visited during his India tour. His grandparents fled to Pakistan in search of better lives. He grew up in Clifton, an upscale neighborhood of Karachi.

In his effusive praise of the neighboring country that has twice elected Modi, Uzair completely missed the fact that Narendra Modi, now India's prime minister, is widely believed to be the perpetrator of a anti-Muslim pogrom in 2002 when he was the chief minister of Gujarat. The Muslim survivors of the 2002 massacre are still languishing near a mountain of trash on the outskirts of Ahmedabad, battling poverty and disease. Uzair Younus should have paid a visit to show solidarity with them.

24 comments:

OllieMarch 12, 2023 at 7:42 AM
Good luck to Younus and his content marketing journey.

And good luck with feeding the Bhakts with more bravados in quest to monetise his content.
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MajumdarMarch 12, 2023 at 8:10 AM
You have a point. Youtube has this policy of sharing revenues based on the number of views. Naturally it makes sense to cater to the Indian market. India has almost 7 times as many people as Pak. On top of that, data is insanely cheap which means that India's per capita data usage is way out of line with its per capita income and other parameters.
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Riaz HaqMarch 12, 2023 at 10:10 AM
Cricket 2023: ‘A hundred in India, as an Australian that’s what you want,’ Khawaja says

by Malcolm Conn

https://www.smh.com.au/sport/cricket/a-hundred-in-india-as-an-australian-that-s-what-you-want-khawaja-20230309-p5cqx1.html

Indian Prime Minister Narendra Modi led Australia to the promised land but only a man originally stopped from entering India was able to make a significant impression.

Usman Khawaja continued his exceptional return to Test as the game’s most productive batsman since the beginning of last year, scoring an unbeaten 104as his teammates failed to cash in on a rare benign Indian pitch after winning the toss and batting on Thursday.

Such was the pageantry that the toss was delayed as Modi, with Australian counterpart Anthony Albanese at his elbow, did a lap of the ground in what can only be described as a cricket chariot.

Adulation and lining up with the teams for the national anthems done, the PMs cleared out about an hour after play started to do the tours and announcements which allies of convenience do.

Advertisement
The irony should be lost on no one that it was Khawaja, a Pakistani-born muslim, who dominated the cricket after Modi was choreographically feted at the huge Ahmedabad stadium named in his honour.

The stage-managed political fluff was exposed by Khawaja in the last over of the day’s play when he flicked a Mohammed Shami delivery through the leg side and danced with real, unbridled joy, celebrating his first century in India and first against India.

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Hubris personified
POLITICS AND PLAY | Narendra Modi at the Narendra Modi stadium

by Ramachandra Guha

I was first alerted to this mischief by a friend, who, hoping to travel to Ahmedabad for the Test, found that tickets were on sale to the general public only from the second day. Ticket websites said there were no tickets available for the first day. My friend however found that an acquaintance had acquired a ticket through what one might call the ‘bhakt quota’. As it happens, Australian fans had also not been able to get tickets for the first day. Learning of this, Peter Lalor wrote a report in The Australian where he remarked, with regard to the non-availability of tickets, that “with neither of the first two Tests lasting three full days it is an enormous frustration to the hundreds of Australians who have travelled to India for the Border Gavaskar Trophy. Not to mention tens of thousands of local cricket fans.” Lalor also observed that “the Indian PM is notorious for stage managing events,” adding that “it is expected that hordes of his handpicked fans will fill the stadium for his appearance at the national anthem with the Australian PM.”

Following Lalor’s report, Australian diplomats lobbied with the Board of Control for Cricket in India. A special booth was opened to sell tickets to the several hundred cricket fans who had travelled to India from Down Under. This still left, as it took an Australian writer to point out, tens of thousands of home fans in the lurch. They had no one to lobby on their behalf. The cricket media in India is, by large, as ‘godi’ as the rest of the media, loath to offend the BCCI, which, under its current management, acts as an arm of the ruling party.

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Riaz HaqMarch 12, 2023 at 10:44 AM
SVB collapse: Indian startups should resist pressure from large investors to domicile outside, says Mohandas Pai

https://www.businesstoday.in/silicon-valley-bank/story/svb-collapse-indian-startups-should-resist-pressure-from-large-investors-to-domicile-outside-says-mohandas-pai-373082-2023-03-12

He advised founders of India-centric startups "to be careful" and "not get carried away" by investors who force companies they fund, to domicile in the US and open bank accounts there as well, according to a PTI report.

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Union IT minister to meet Indian startups amid concerns over ..

Read more at:
http://timesofindia.indiatimes.com/articleshow/98586043.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

On Friday, US regulators pulled the plug on SVB - a key lender to US startups since the 1980s - after a run on deposits made it no longer tenable for the medium-sized bank to stay afloat on its own.
SVB has exposure to over 20 startups in India and began investing here in 2003.
According to startup research advisory Tracxn, SVB has invested in several Indian firms, including Paytm, Carwale, Bluestone, Shaadi and Sarva. In October last year, SVB had invested $150 million in contract intelligence company Icertis.
Following the collapse, startup founders and investors in Mumbai exchanged rumors about which fledgling company might be the first to fall, Bloomberg reported.
India has one of the world's biggest startup markets, with many clocking multi-billion-dollar valuations in recent years and getting the backing of foreign investors who have made bold bets on digital and other tech businesses.
SVB's failure, the biggest in the US since the 2008 financial crisis, has roiled global markets, hit banking stocks and is now unsettling Indian entrepreneurs.
Two partners at an Indian venture capital fund and one lender to Indian start-ups told Reuters that they are running checks with portfolio companies on any SVB exposure and if so, whether it is a significant part of their total bank balance.
An Indian founder told Bloomberg News he failed to retrieve company funds and is now left only with working capital. Another was scurrying to stop and reroute customer payments into his company’s SVB account, while also setting up new arrangements for salary payments. Three founders and a startup investor said they hadn’t slept in 48 hours.
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Riaz HaqMarch 12, 2023 at 11:18 AM
Uzair Younus عُزیر یُونس
@UzairYounus
Astonished by how many people tuned in to listen and engage about my trip to 🇮🇳 on the
@pakistonomy
YT channel!

The metrics chart is evidence that people in both countries want to travel and engage with one another.

If that curiosity wasn’t there, folks wouldn’t be tuning in.

https://twitter.com/UzairYounus/status/1634515360803061760?s=20

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Riaz HaqMarch 15, 2023 at 11:07 AM
Is India ready to take China’s place in the global economy? That’s just wishful thinking

https://www.scmp.com/comment/opinion/article/3213475/india-ready-take-chinas-place-global-economy-thats-just-wishful-thinking

by Sameer Basha

Australia and other US allies looking for potential trade and investment partners to reduce their reliance on China are knocking on India’s door

But India’s modest economic size, challenging investment environment and substandard infrastructure are major deterrents to fruitful collaboration

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India has been increasingly viewed as a natural ally to countries like Australia, which see it as an economic and military counterweight to China. They believe the best way for this to happen is through foreign direct investment into the country, to allow for a gradual transition of enterprises from China to India.
In its 2022 Investment Climate Statement on India, the US State Department called the country “a challenging place to do business” and highlighted its protectionist measures, increased tariffs and an inability to adjust from “Indian standards” to international standards.
The 2023 Index of Economic Freedom ranks India 131st in the world and 27th out of 39 economies in the Asia-Pacific region. The Indian government places equity limits on foreign capital in some sectors of the economy. In these sectors, according to the government’s circular of its FDI policy, beyond the cap imposed on foreign ownership, the entity must be “owned by/held with/in the hands of resident Indian citizens and Indian companies, owned and controlled by resident Indian citizens”.
In addition, ambiguities in the tax code have meant companies like Vodafone, Cairn Energy and GE Capital have found themselves in the cross hairs of tax authorities, putting into question India’s maturity as an FDI hub.
Such actions have seen India’s FDI inflows, as a share of the global total, fall from 3.4 per cent to 2.8 per cent between 2019 and 2021, whereas China’s share has have risen from 14.5 per cent to 20.3 per cent. In recent years, companies like Harley-Davidson and the Royal Bank of Scotland have either downsized or exited India, with German retailer Metro AG selling its operations after two decades in the country.
When one compares the relative size of their economies, China had a nominal gross domestic product of US$17.7 trillion in 2021, while India’s was US$3.2 trillion. India invests only 30 per cent of its GDP, compared with 50 per cent for China; and 20 per cent of its economy comes from manufacturing, as opposed to 30 per cent of China.
Investing in a domestic network of roads, airports, seaports and rail lines, as well as streamlining FDI regulations, allows China to move its products from factories to consumers efficiently, making it an attractive prospect for investment. That is not to mention the world-class infrastructure that has transformed the urban landscapes of both old and new cities within the country.
Despite India’s economic progress, poverty is still a defining feature in its sprawling metropolises. Former Reserve Bank of India governor Raghuram Rajan has also weighed in on the India-China competition, stating: “The argument that India will replace China is very premature as India is a much smaller economy as of now.”
Unfortunately, India is not currently in a place to deliver on the expectations placed on it by countries like Australia, which remain stuck in a geopolitical gambit with China. Simply banking on its large population is a fickle way of viewing the options amid a decoupling from China’s economy. India is still decades away from realising its true potential.
The two countries’ goals also differ. China is transforming itself into a technologically driven economy in order to exceed the potential of the US. In contrast, India is attempting to position itself as a market-driven economy utilising its large population as a manufacturing base to compete with China.
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Riaz HaqMarch 15, 2023 at 11:08 AM
Is India ready to take China’s place in the global economy? That’s just wishful thinking

https://www.scmp.com/comment/opinion/article/3213475/india-ready-take-chinas-place-global-economy-thats-just-wishful-thinking

by Sameer Basha

Australia may be merely continuing along the tried and tested path of seeking “great and powerful friends”, as it has done in the past with the UK and America, to take care of it and help protect its interests. It may see in India a stable and uncomplicated trading partner compared to China.
However, thorough planning is required to meet the challenges and avoid the risks before conducting business in such an environment, which appears absent from current conversations. In 2021, India was Australia’s sixth-largest two-way goods and services trading partner, valued at A$34.4 billion (US$22.9 billion), and the fourth-largest goods and services export market, valued at A$19.3 billion, representing a 4.2 per cent market share of Australia’s total exports.

However, China is Australia’s largest two-way trading partner, at A$267 billion, representing 32.2 per cent of Australia’s total trade. Some A$178 billion of goods and services made it to Chinese ports in 2020-2021. Australia hopes to expand bilateral trade to A$100 billion with India.
Anyone in Canberra who sees India as a viable substitute for China is seriously out of touch, and will be putting the nation’s export industries in a precarious position with their wishful geopolitical decisions not based on the realities on the ground.
Sameed Basha is a defence and political analyst with a master’s degree in international relations from Deakin University, Australia

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When faced with sanctions from Beijing, Canberra exhibited a resilient front. Still, internal anxieties about the impact on its economy led Prime Minister Anthony Albanese to visit India recently, a potential export market and replacement for Australia’s economic ties with China.
Comparing China to India is like comparing apples with oranges, with the only similarity being their billion-plus populations. The United States is encouraging its allies like Australia to bet big on India as the slow process of decoupling investments from China begins.

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Riaz HaqMarch 20, 2023 at 8:42 AM
In spite of their recent troubles, the Pakistanis (rank 108) are still happier than Indians (rank 126) and Bangladeshis (rank 119), according to the World Happiness Report 2023 released today.

The country rankings show life evaluations (answers to the Cantril ladder question) for each country, averaged over the years 2020-2022.

This is the Cantril ladder: it asks respondents to think of a ladder, with the best possible life for them being a 10 and the worst possible life being a 0. They are then asked to rate their own current lives on that 0 to 10 scale. The rankings are from nationally representative samples for the years 2019-2021.

World Happiness Rankings 2023 based on 3 year average among 137 countries

Finland Rank 1 Score 7.804

China Rank 64 Score 5.818

Pakistan Rank 108 Score 4.555

Bangladesh Rank 119 Score 4.282

India Rank 126 Score 4.036

Lebanon Rank 136 Score 2.392

Afghanistan Rank 137 Score 1.859

Happiness Gap Between Top Half and Bottom Half

Pakistan 4.427

India 4.64

Country name Ladder score Standard error of ladder score upper whisker lower whisker Logged GDP per capita Social support Healthy life expectancy Freedom to make life choices Generosity Perceptions of corruption Ladder score in Dystopia Explained by: Log GDP per capita Explained by: Social support Explained by: Healthy life expectancy Explained by: Freedom to make life choices Explained by: Generosity Explained by: Perceptions of corruption Dystopia + residual

Finland 7.804 0.036 7.875 7.733 10.792 0.969 71.150 0.961 -0.019 0.182 1.778 1.888 1.585 0.535 0.772 0.126 0.535 2.363

China 5.818 0.044 5.905 5.731 9.738 0.836 68.689 0.882 -0.041 0.727 1.778 1.510 1.249 0.468 0.666 0.115 0.145 1.666
5.818 0.044 5.905 5.731 9.738 0.836 68.689 0.882 -0.041 0.727 1.778 1.510 1.249 0.468 0.666 0.115 0.145 1.666

Pakistan 4.555 0.077 4.707 4.404 8.540 0.601 57.313 0.766 0.008 0.787 1.778 1.081 0.657 0.158 0.511 0.141 0.102 1.907

Bangladesh 4.282 0.068 4.416 4.148 8.685 0.544 64.548 0.845 0.005 0.698 1.778 1.133 0.513 0.355 0.617 0.139 0.165 1.361

India 4.036 0.029 4.092 3.980 8.759 0.608 60.777 0.897 0.072 0.774 1.778 1.159 0.674 0.252 0.685 0.175 0.111 0.979

Lebanon 2.392 0.044 2.479 2.305 9.478 0.530 66.149 0.474 -0.141 0.891 1.778 1.417 0.476 0.398 0.123 0.061 0.027 -0.110

Afghanistan 1.859 0.033 1.923 1.795 7.324 0.341 54.712 0.382 -0.081 0.847 1.778 0.645 0.000 0.087 0.000 0.093 0.059 0.976
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Riaz HaqMarch 20, 2023 at 10:49 AM
India is home to a quarter of the world’s hunger burden with nearly 224.3 million people undernourished in the country. The situation is even more dire among children under the age of five — 36.1 million are stunted, accounting for 31% being chronically malnourished.

https://timesofindia.indiatimes.com/blogs/voices/good-health-begins-in-healthy-soil/

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Riaz HaqMarch 21, 2023 at 8:28 AM
India is among the least happy countries in the world—worse than even war-hit Ukraine

ndia is also worse off than neighbors like Nepal, China, Bangladesh, Pakistan, and others

https://qz.com/india-is-less-happy-than-even-war-hit-ukraine-1850246790

India has been one of the least happy countries in the world in recent years.

It was ranked 126 out of 137 countries surveyed, according to the 2023 edition of the World Happiness Report released yesterday (March 20). It was placed worse than neighbors like Nepal, China, Bangladesh, Pakistan, and others. The country is worse off than even war-hit Ukraine.

The annual report for the 2020-2022 time period uses life evaluations from the Gallup World Polls, which survey a representative sample of adults from every country, to arrive at its conclusions.

A lack of social support and connections among citizens during the covid-19 pandemic has been identified as the key reason for Indians being so gloomy. The pandemic-induced lockdown left millions of Indians stuck in social isolation, leading up to stress and depression.

Experts said that a lack of social connections over long periods of time, along with severe unemployment, high inflation scenario and healthcare worries, took a toll on people’s mental health.

“While people in India were least likely to have had daily interactions with nearby friends or family, at 58%, they were among the most likely to say they had interacted with friends or family who live far away (42%),” the State of Social Connections study by Gallup, Meta, and academic advisers in 2022 stated. Moreover, there was no notable relationship between households and social support in India.

About 55% of Indian women said they “never” interacted with people from work or school in the past seven days, compared to 33% of men. Even social media platforms were of little help to Indians.
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Riaz HaqMarch 30, 2023 at 8:49 AM
Can #India replace #China as a pillar of #global #economy? @NickKristof doubts it. A 9th grader in #Kolkata can not do simple multiplication. School absenteeism is rampant in #Rajasthan. China thrives because it made huge #investments in #humancapital. https://www.nytimes.com/2023/03/29/opinion/india-economic-growth.html

In conversations with young Indian women, I hear again and again about the barriers they face that their brothers don’t. It’s difficult for single women to rent apartments, it’s considered inappropriate for them to be out in the evening, and they are subjected to a blizzard of sexual harassment, which persists because of a culture of impunity.

Yet I wonder if that, too, isn’t changing. India has more strong, independent women than ever, and they are forcing change.

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As for the I.T. sector, it’s dazzling and in some respects ahead of the United States. Here in India, digital data on mobile phones is extremely cheap, and you can buy a mango from a street vendor with your phone. Digital transactions are everywhere, and people easily keep digital records securely on their phones.

Nandan Nilekani, a pioneer in information services, says that India’s digital public infrastructure enables a technology-led growth model, and there are indeed signs of a boom in entrepreneurial activity in the tech sector: India had 452 start-ups in 2016 and 84,000 last year.

But it is export-led manufacturing that traditionally has provided the path for economic breakout in Asia because it can employ an enormous number of people. In India, manufacturing’s share of the economy has stagnated, and international executives share horror stories about red tape and the difficulty of doing business.

“The point of manufacturing is really job creation,” noted Alyssa Ayres, an India specialist at George Washington University, and that isn’t happening much. “People are worried about why the needle isn’t moving.”

India has had false dawns before. For a while in the 2000s, it was enjoying economic growth rates of roughly 8 percent per year, and it seemed that it might become the next Asian tiger economy. In 2010, The Economist published a cover story, “How India’s Growth Will Outpace China’s.”

Today India has a new chance to lure manufacturers. China has an aging population, its brand is tarnished by repression, and global companies are eager to find new manufacturing bases. India has English speakers, a familiar legal system, low-cost workers and first-rate engineers emerging from the Indian Institutes of Technology.

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Arvind Subramanian, a former economic adviser to the government of India who is now at Brown University, is skeptical that India will change its policies enough to seize the opportunity presented by China’s difficulties. But he thinks Apple’s efforts to manufacture iPhones in India offer a ray of hope by encouraging other companies to follow.

“The entry of Apple is significant — that is the space to watch,” he said. “If Apple thinks India can be a competitive place from which to export to the world, there could be demonstration effects.”

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If India can boost education, free its women to join the labor force and attract the companies that are desperate to find new bases for manufacturing, it can surprise us again.

If it can do that, it will recover its historical role as an economic powerhouse, and the past few centuries of poverty will be forgotten — a blink of the eye in the context of India’s ancient civilization. It would again be normal to think of India as a great power and one of the pillars of the global economy, and that would change the world.

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Riaz HaqMarch 30, 2023 at 10:45 AM
Hype over #India’s #economic boom is dangerous myth masking real problems. It’s built on a disingenuous numbers game.
No silver bullet that will fix weak job creation, a small, uncompetitive #manufacturing sector & gov’t schemes fattening corporate profits

https://www.scmp.com/comment/opinion/article/3215379/hype-over-indias-economic-boom-dangerous-myth-masking-real-problems

by Ashoka Mody

Indian elites are giddy about their country’s economic prospects, and that optimism is mirrored abroad. The International Monetary Fund forecasts that India’s GDP will increase by 6.1 per cent this year and 6.8 per cent next year, making it one of the world’s fastest-growing economies.
Other international commentators have offered even more effusive forecasts, declaring the arrival of an Indian decade or even an Indian century.
In fact, India is barrelling down a perilous path. All the cheerleading is based on a disingenuous numbers game. More so than other economies, India’s yo-yoed in the three calendar years from 2020 to 2022, falling sharply twice with the emergence of Covid-19 and then bouncing back to pre-pandemic levels. Its annualised growth rate over these three years was 3.5 per cent, about the same as in the year preceding the pandemic.
Forecasts of higher future growth rates are extrapolating from the latest pandemic rebound. Yet, even with pandemic-related constraints largely in the past, the economy slowed in the second half of 2022, and that weakness has persisted this year. Describing India as a booming economy is wishful thinking clothed in bad economics.
Worse, the hype is masking a problem that has grown in the 75 years since independence: anaemic job creation. In the next decade, India will need hundreds of millions more jobs to employ those who are of working age and seeking work. This challenge is virtually insurmountable considering that the economy failed to add any net new jobs in the past decade, when 7 million to 9 million new jobseekers entered the market each year.
This demographic pressure often boils over, fuelling protests and episodic violence. In 2019, 12.5 million people applied for 35,000 job openings in the Indian railways – one job for every 357 applicants. In January 2022, railway authorities announced they were not ready to make the job offers. The applicants went on a rampage, burning train cars and vandalising railway stations.

With urban jobs scarce, tens of millions of workers returned during the pandemic to eking out meagre livelihoods in agriculture, and many have remained there. India’s already-distressed agriculture sector now employs 45 per cent of the country’s workforce.

Farming families suffer from stubbornly high underemployment, with many members sharing limited work on plots rendered steadily smaller through generational subdivision. The epidemic of farmer suicides persists. To those anxiously seeking support from rural employment-guarantee programmes, the government unconscionably delays wage payments, triggering protests.
For far too many Indians, the economy is broken. The problem lies in the country’s small and uncompetitive manufacturing sector.
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Riaz HaqMarch 30, 2023 at 10:47 AM
India is Broken

https://www.scmp.com/comment/opinion/article/3215379/hype-over-indias-economic-boom-dangerous-myth-masking-real-problems

by Ashoka Mody

Since the liberalising reforms of the mid-1980s, the manufacturing sector’s share of GDP has fallen slightly to about 14 per cent, compared to 27 per cent in China and 25 per cent in Vietnam. India commands less than a 2 per cent global share of manufactured exports, and as its economy slowed in the second half of 2022, the manufacturing sector contracted further.
Yet it is through exports of labour-intensive manufactured products that Taiwan, South Korea, China and now Vietnam came to employ vast numbers of their people. India, with its 1.4 billion people, exports about the same value of manufactured goods as Vietnam does with 100 million people.
Those who believe that India stands at the cusp of greatness usually focus on two recent developments. First, Apple contractors have made initial investments to assemble high-end iPhones in India, leading to speculation that a broader move away from China by manufacturers will benefit India despite the country’s considerable quality-control and logistical problems.

while such an outcome is possible, academic analysis and media reports are discouraging. Economist Gordon H. Hanson says Chinese manufacturers will move labour-intensive manufacturing from the country’s expensive coastal hubs to its less-developed interior, where production costs are lower.
Moreover, investors moving out of China have gone mainly to Vietnam and other countries in Southeast Asia, which like China are members of the Regional Comprehensive Economic Partnership. India has eschewed membership in this trade bloc because its manufacturers fear they will be unable to compete once other member states gain easier access to the Indian market.
As for US producers pulling away from China, most are “near-shoring” their operations to Mexico and Central America. Altogether, while some investment from this churn could flow to India, the fact remains that inward foreign investment fell year on year in 2022.

The second source of hope is the Indian government’s Production-Linked Incentive Schemes, which were introduced in early 2021 to offer financial rewards for production and jobs in sectors deemed to be of strategic value. Unfortunately, as former Reserve Bank of India governor Raghuram G. Rajan and his co-authors warn, these schemes are likely to end up merely fattening corporate profits like previous sops to manufacturers.
India’s run with start-up unicorns is also fading. The sector’s recent boomrelied on cheap funding and a surge of online purchases by a small number of customers during the pandemic. But most start-ups have dim prospects for achieving profitability in the foreseeable future. Purchases by the small customer base have slowed and funds are drying up.
Looking past the illusion created by India’s rebound from the pandemic, the country’s economic prognosis appears bleak. Rather than indulge in wishful thinking and gimmicky industrial incentives, policymakers should aim to power economic development through investments in human capital and by bringing more women into the workforce.
India’s broken state has repeatedly avoided confronting long-term challenges and now, instead of overcoming fundamental development deficits, officials are seeking silver bullets. Stoking hype about an imminent Indian century will merely perpetuate the deficits, helping neither India nor the rest of the world.
Ashoka Mody, visiting professor of international economic policy at Princeton University, is the author of India is Broken: A People Betrayed, Independence to Today. Copyright: Project Syndicate
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Riaz HaqApril 4, 2023 at 4:10 PM
Analysis: India's surging services exports may shield economy from external risks

https://www.reuters.com/world/india/indias-surging-services-exports-may-shield-economy-external-risks-2023-04-03/

IT services still accounted for 45% of India's total services exports in April-December.

Professional and management consulting grew the fastest - at a 29% compounded annual growth rate over the last three years, as per estimates by economists at HSBC Securities and Capital Markets.

The recent growth in services exports has been largely powered by global capability centres, which have started to offer global clients a range of high-end and critical solutions such as accounting and legal support.

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This, together with a drop in merchandise trade deficit, resulted in the current account deficit shrinking more than expected to $18.2 billion, or 2.2% of GDP.

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A surge in India's services exports, which hit a record high in the October-December quarter, is expected to shield the economy from external risks as a slowing global economy will likely weigh on the country's merchandise exports.

Service exports are no longer being driven by IT services alone but also by more lucrative offerings such as consulting and research and development, analysts and economists told Reuters.

India's services exports rose 24.5% on year in October-December 2022, hitting a record $83.4 billion during the quarter, data released by the Reserve Bank of India (RBI) on Friday showed.

The services surplus, which deducts any imports in the category, also rose 39.21% to a record $38.7 billion.

This, together with a drop in merchandise trade deficit, resulted in the current account deficit shrinking more than expected to $18.2 billion, or 2.2% of GDP.

"We expect services exports to grow to over $375 billion by March 2024, as compared to $320-350 billion for the year ending March 2023," said Sunil Talati, chairman of the Services Export Promotion Council.

Services exports will likely surpass goods exports by March 2025, he said.

October-December merchandise exports stood at $105.6 billion, according to latest RBI data.

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As a result, such exports will hold up better compared to goods exports in the face of a weakening global economy, analysts said.

Over the last two to three years, there has been a rapid growth in global capability centres, said Sangeeta Gupta, chief strategy officer at software industry lobby group Nasscom.

Nasscom estimates that India is home to over 45% of such global capability centres in the world.

According to Pranjul Bhandari, chief India economist at HSBC Securities and Capital Markets, such centres started off providing support functions, but they have now moved up the ladder to tech enablement, business operations, capability development, and even R&D and business development.

While U.S. companies were the first movers in India, a lot of companies from Europe, Australia and Asia are also exploring stepping up their operations, Nasscom's Gupta said.

An acceleration in digitalisation after the Covid crisis and a lack of adequate tech talent in some of these countries are key factors, she added.

Sectors such as tourism, education, financial services and health also contributed to India's higher service exports.
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Riaz HaqApril 8, 2023 at 10:17 AM
Why Prof. Ashoka Mody Believes India is Broken | Princeton International

https://international.princeton.edu/news/why-prof-ashoka-mody-believes-india-broken

I have long felt that that upbeat story is completely divorced from the lived reality of the vast majority of Indians. I wanted to write a book about that lived reality, about jobs, education, healthcare, the cities Indians live in, the justice system they encounter, the air they breathe, the water they drink. And when you look at India through that lens of that reality, the progress is halting at best and far removed from the aspirations of people and what might have been. India is broken in the sense that for hundreds of millions of Indians, jobs are hard to get, and education and health care are poor. The justice system is coercive and brutal. The air quality remains extraordinarily poor. The rivers are dying. And it's not clear that things are going to get better. Underlying that brokenness, social norms and public accountability have eroded to a point where India seems to be in a catch-22: Unaccountable politicians do not impose accountability on themselves; therefore, no one has an incentive to impose accountability for policy priorities that might benefit large numbers of people. The elite are happy in their gated first-world communities. They shrug their shoulders and say, “What exactly is the problem?”

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Prof Ashoka Mody interviewed by Barkha Dutt

https://www.youtube.com/watch?v=L8SEmML71KQ
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Riaz HaqApril 10, 2023 at 10:15 AM
As India’s population soars above all, fewer women have jobs

https://news.yahoo.com/india-population-soars-above-fewer-042021160.html

The women’s employment rate peaked at 35% in 2004 and fell to around 25% in 2022, according to calculations based off official data, said Rosa Abraham, an economist at Azim Premji University. But official figures count as employed people who report as little as one hour of work outside the home in the previous week.

A national jobs crisis is one reason for the gap, experts say, but entrenched cultural beliefs that see women as the primary caregivers and stigmatize them working outside the home, as in Singh's case, is another.

The Center for Monitoring the Indian Economy (CMIE), which uses a more restrictive definition of employment, found that only 10% of working age Indian women in 2022 were either employed or looking for jobs. This means there are only 39 million women employed in the workforce compared to 361 million men.

Just a few decades ago, things seemed to be on a different track.

When Singh became a social worker in 2004, India was still riding high from historic reforms in the 1990s. New industries and new opportunities were born seemingly overnight, sparking millions to leave their villages and move to cities like Mumbai in search of better jobs.

It felt life-changing. “I didn’t have a college degree, so I never thought it would be possible for someone like me to get a job in an office,” she said.

Even then, leaving home to work was an uphill fight for many women. Sunita Sutar, who was in school in 2004, said that women in her village of Shirsawadi in Maharashtra state were usually married off at 18, beginning lives that revolved around their husbands’ homes. Neighbors mocked her parents for investing in her education, saying it wouldn’t matter after marriage.

Sutar bucked the trend. In 2013, she became the first person in her village of nearly 2,000 people to earn an engineering degree.

“I knew that if I studied, only then would I become something -- otherwise, I’d be like the rest, married off and stuck in the village,” Sutar said.

Today, she lives and works in Mumbai as an auditor for the Indian Defense Department, a government job coveted by many Indians for its security, prestige and benefits.

In one way, she was part of a trend: Indian women have gained better access to education since her youth, and are now nearly at parity with men. But for most women, education hasn’t led to jobs. Even as more women have begun graduating from school, joblessness has swelled.

“The working age population continues to grow but employment hasn’t kept up, which means the proportion of people with jobs will only decline,” said Mahesh Vyas, director at CMIE, adding there’s been a severe slowdown in good quality jobs in the last decade. “This also keeps women out of the workforce as they or their families may see more benefit in taking care of the home or children, instead of toiling in low-paid work.”

And even when jobs are available, social pressures can keep women away.

In her home village in Uttar Pradesh state, Chauhan hardly ever saw women working outside the home. But when she came to Mumbai in 2006, she saw women swarm public spaces, Chauhan said, serving food in cafes, cutting hair or painting nails in salons, selling tickets for the local trains, or boarding the trains themselves, crammed into packed compartments as they rushed to work. It was motivating to see what was possible, she said.

“When I started working and leaving the house, my family used to say I must be working as a prostitute,” said Lalmani Chauhan, a social worker.

One reason she was able to hold onto her job was because it became a lifeline when an accident left her husband bedridden and unable to work, Chauhan said.

Abraham said there is growing recognition among policymakers that the retreat of women from the workforce is a huge problem, but it has not been met with direct fixes like more childcare facilities or transportation safety.
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Riaz HaqApril 17, 2023 at 5:39 PM
US becomes India's biggest trading partner in FY23: Report

https://www.livemint.com/news/india/us-becomes-india-s-biggest-trading-partner-in-fy23-report-11681689914529.html

(Indian) Exports to China dipped by about 28 per cent to USD 15.32 billion in 2022-23, while imports rose by 4.16 per cent to USD 98.51 billion in the last fiscal. Trade gap widened to USD 83.2 billion in the last fiscal as against USD 72.91 billion in 2021-22.

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The US has emerged as India's biggest trading partner in 2022-23 on account of increasing economic ties between the two countries.

According to the provisional data of the commerce ministry, the bilateral trade between India and the US has increased by 7.65 per cent to USD 128.55 in 2022-23 as against USD 119.5 billion in 2021-22. It was USD 80.51 billion in 2020-21.

Exports to the US rose by 2.81 per cent to USD 78.31 billion in 2022-23 as against USD 76.18 billion in 2021-22, while imports grew by about 16 per cent to USD 50.24 billion, the data showed.

On the other hand, during 2022-23, India's two-way commerce with China declined by about 1.5 per cent to USD 113.83 billion as against USD 115.42 billion in 2021-22.

Exports to China dipped by about 28 per cent to USD 15.32 billion in 2022-23, while imports rose by 4.16 per cent to USD 98.51 billion in the last fiscal. Trade gap widened to USD 83.2 billion in the last fiscal as against USD 72.91 billion in 2021-22.

Experts believe that the trend of increasing bilateral trade with the US will continue in the coming years also as New Delhi and Washington are engaged in further strengthening the economic ties.

Federation of Indian Export Organisations (FIEO) President A Sakthivel said that increasing exports of goods such as pharmaceutical, engineering and gems and jewellery is helping India to push its shipments to America.

"The trend of increasing trade with the US will continue in the coming months also," he said.

FIEO Vice President Khalid Khan said India is emerging as a trusted trading partner and global firms are reducing their dependence only on China for their supplies and are diversifying business into other countries like India.

"The bilateral trade between India and the US will continue to grow as our exporters are getting good orders from that country," Khan said.

Rakesh Mohan Joshi, Director of the Indian Institute of Plantation Management (IIPM), Bangalore, too said that India provides huge trade opportunities for the US as India is the world's third largest consumer market and the fastest growing market economy.

"Major export items from India to the US include petroleum, polished diamonds, pharmaceutical products, jewellery, light oils and petroleum, frozen shrimp, made ups etc. whereas major imports from the US include petroleum, rough diamonds, liquified natural gas, gold, coal, waste and scrap, almonds etc," Joshi said.

America is one of the few countries with which India has a trade surplus. In 2022-23, India had a trade surplus of USD 28 billion with the US.

The data showed that China was India's top trading partner since 2013-14 till 2017-18 and also in 2020-21. Before China, the UAE was the country's largest trading partner.

In 2022-23, the UAE with USD 76.16 billion, was the third largest trading partner of India. It was followed by Saudi Arabia (USD 52.72 billion), and Singapore (USD 35.55 billion).
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Riaz HaqApril 20, 2023 at 7:59 AM
Kapil Sibal
@KapilSibal
·
12h
India ahead of China
Population :
India 1428 mn
China 1425 mn

Other indicators(2021)
World Bank Data :

GDP
China : $17.73 trillion
India : 3.18 trillion

Unemployment:
China : 4.8%
India: 7.7%

Annual inflation
(consumer prices) :
China : 1%
India : 5.1%

Think about it !

https://twitter.com/KapilSibal/status/1648877269124009984?s=20
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Riaz HaqJune 16, 2024 at 9:50 AM
Pakistani YouTubers And Praise India Movement in Pakistan - India Today

"Indians love people from abroad lauding their achievements, but seem to derive the biggest satisfaction when Pakistanis gush over India's success. Pakistanis have understood that and have tapped into that, creating an entire industry of YouTubers in Pakistan"

https://www.indiatoday.in/sunday-special/story/praise-india-movement-pakistan-reaction-videos-on-indian-cricket-food-politics-youtube-shorts-pakistani-youtubers-2553682-2024-06-16

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There is a Praise India Movement in Pakistan if one goes by the pro-India videos being churned out by Pakistani YouTubers. If some are praising India's space programme, others are talking about its economic and political successes. Why are Pakistanis creating such YouTube videos, and that too, in such huge numbers?

"India did a big favour to Pakistan. It was also a tight slap for those Pakistanis who said India would deliberately lose to the USA to get Pakistan out of the T20 World Cup tournament. India is the world's number one team, and can never lose to the US," a man in a black salwar kameez states emphatically, looking at the camera. The person isn't an Indian gushing at India's victory over the USA in a T20 World Cup match, but a Pakistani speaking to a popular Pakistani YouTuber at a market in Pakistan.

The video by YouTuber Shaila Khan on her channel Naila Pakistani Reaction has over 3 lakh views in a day.

Indians love people from abroad lauding their achievements, but seem to derive the biggest satisfaction when Pakistanis gush over India's success. Pakistanis have understood that and have tapped into that, creating an entire industry of YouTubers in Pakistan.

There are 5,500 channels and over 84,000 videos just with the hashtag pakistanireactiononindia on YouTube. The number of channels, tracked by IndiaToday.In since November 2023, has grown by 1,000 in a matter of six months. Over 5,000 videos have been added under this hashtag since November.

We are talking about just one hashtag. There are several others with India-related content, some of which every Indian would have come across while scrolling through shorts and videos on YouTube.

This content boom by Pakistani YouTubers has sparked a Praise India Movement in Pakistan.

Seeing is believing, especially if it is about YouTube.

So, just try keying in #Pakistani on the YouTube search bar. The first few results are Pakistani Reaction, Pakistani Reaction on India and Pakistani Public Reaction -- all to do with content related to India.

Such is the rage that even #PakistaniDrama, one of Pakistan's biggest cultural exports, trends below the #PakistaniReaction.

WHAT ARE THE PRO-INDIA VIDEOS PAKISTANIS ARE CREATING
There was a flood of videos by Pakistani YouTubers lauding Team India right after their victory over the USA.

Though cricket is one of the favourites, the range of 'praise India' videos spans from India's economic might to infrastructural developments; from gastronomic delights to space programmes. Then there are videos of Pakistanis describing in amazement their wonderful discoveries during their first visit to India.

You name it, and they have it. There are Pakistani reaction clips to every Top 10 video, featuring India's shopping malls, highways, airports, college campuses, cars, bikes and even golgappas.
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