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

Wednesday, January 28, 2026

EU-India Trade Deal: "Uncapped" Mass Migration of Indians?

The European Union (EU) and India have recently agreed to a trade deal which includes an MOU to allow “an uncapped mobility for Indian students”, according to officials, allowing Indians greater ease to travel, study and work across EU states. India's largest and most valuable export to the world is its people who last year sent $135 billion in remittances to their home country. Going by the numbers, the Indian economy is a tiny fraction of the European Union economy. Indians make up 17.8% of the world population but contribute only 3.3% of the global GDP. The European Union, on the other hand, has just 5.6% of the global population and produces 17.8% of the world's economic output.

Indian Economy Dwarfed by EU. Source: DW

If finally signed and implemented, this "uncapped mobility" for Indians will probably become the most significant part of the deal. “More than 800,000 Indians are living and actively contributing to the countries of the European Union", according to Indian Prime Minister Narendra Modi. The two sides welcomed the conclusion of the India‑EU Comprehensive Framework of Cooperation on Mobility, in line with the national competences of EU Member States and India and domestic legislation of both parties. They applauded the launch of the first pilot European Legal Gateway Office, as a one‑stop hub to provide information and support the movement of workers, starting with the ICT sector.

Indians are currently the seventh-largest migrant group in Germany. Just the talk of "uncapped mobility" from India will trigger a backlash across Europe where far-right parties opposed to all immigration are gaining popularity. There have been high-profile hate incidents against Indians in several European countries recently. While the rise of the AfD (Alternative for Germany) has increased hatred against Indian migrants, the arrival of the far-right in the mainstream political system in Germany has also started a conversation on racism that otherwise would have been swept under the rug.

EU-India Migration Agreement Tweeted by Modi

Undaunted by the anti-immigrant sentiments, the Indian government has quietly signed labor mobility agreements with at least 20 countries over the past half-dozen years — in Europe and Asia, including the Persian Gulf — all with developed economies and most without much history of hiring Indian workers, according to the New York Times. Arnab Bhattacharya, the chief executive of the "Global Access to Talent From India Foundation" think tank, estimates that India could double its current export of 700,000 workers a year to 1.5 million by 2030. His country, he told the NY Times, “has a workforce that should be servicing the world and not just India.” Their real aim is to deal with the ongoing unemployment crisis in India.

EU-India Migration Agreement Tweeted by Modi

Indian economy is not generating enough jobs for the nation's growing working age population. Corporate profits of Indian firms are growing at a much slower pace than the 8.2% GDP growth in its most recent quarter. Net income for Nifty 50 Index firms likely rose 1.1% in the three months through Dec. 31 from a year earlier, according to analyst estimates compiled by Bloomberg. That would be the slowest pace in five quarters, weighed down by deteriorating margins for banks. Falling profits and declining currency are causing foreign capital to flee Indian markets. Foreign Portfolio Investors (FPIs) pulled out over $20 billion from Indian equities in 2025, marking a severe, sustained withdrawal that has continued into 2026. Net Foreign Direct Investment (FDI) has seen consecutive monthly outflows, including $1.67 billion in October and $446 million in November 2025. Investment banker Ruchir Sharma wrote about it in a Financial Times op ed titled "India needs to import more capital and export fewer workers". Ruchir wrote: "Most strikingly, corporate revenue normally grows (or shrinks) with the economy — in any country. But last year corporate revenue growth for listed companies in India decelerated to barely half the GDP growth rate"

Sunday, January 25, 2026

Independent Economists Expose Modi's Fake GDP

Ruling politicians in New Delhi continue to hype their country's economic growth even as the Indian currency hits new lows against the US dollar, corporate profits fall, electrical power demand slows, domestic savings and investment rates decline and foreign capital flees Indian markets. The International Monetary Fund (IMF) has questioned India's GDP and independent economists Professors Arun Kumar and Ashoka Modi and investment banker Ruchir Sharma have detailed why the Indian official data can not be trusted. It seems that the BJP-led government of Prime Minister Narendra Modi is fast losing credibility by politicizing the civilian bureaucracy and the military brass to project their economic and military failures as successes.

IMF Gives C Grade to India's GDP Data

Beyond the disputed claim of being the "fourth largest economy", the Modi government's failure on the national health and wellness front is also getting more attention. “Air is unbreathable. Water is undrinkable. Food is adulterated. What’s the point of becoming the 4th largest economy?” asked India-American technology entrepreneur Sabeer Bhatia in an X message recently. Gita Gopnath, Harvard professor of economics, said at the World Economic Forum in Davos this week that the economic impact of pollution on India is more severe than the effects of tariffs imposed on the country. “About 1.7 million lives are lost every year in India because of pollution. That’s 18% of the total deaths in India,” Gopinath said, quoting a World Bank study. “Even from an international investor’s perspective … the pollution holds you back.”

Unsafe Drinking Water in India Claimed as 4th Largest Economy. Source: DownToEarth

An international badminton tournament in India has brought global spotlight on the lack of basic hygiene in India. Foreign players complained about dusty floors, dirty courts, bird droppings and unhygienic conditions at the India Open in New Delhi. “I think the floors are dirty. There is a lot of dirt on the courts. There’s bird excrement. There are birds flying around in the arena,” said 28 year-old Denmark women’s singles player Mia Blichfeldt. Andres Antonson, world number three badminton player, withdrew from the India Open Super 750 in New Delhi for the third consecutive year, choosing to pay a $5,000 fine. He cited "extreme" hazardous air pollution in Delhi as the reason for skipping the mandatory tournament, arguing it is not a safe place to hold the event.

The IMF has recently expressed doubts about Prime Minister Narendra Modi's BJP government's GDP data. It has particularly questioned the government's statistical methodologies, inflation measurement, and the estimates of the informal economy used in reporting the country's gross domestic product. Professor Arun Kumar of Jawaharlal Nehru University believes the IMF's concerns are valid. He thinks the real size of India's economy is only half of what is officially claimed. “The economy is almost 50% wrong – when the government says it’s $3.8 trillion, my estimate is it is probably still $2.5 trillion because we are overestimating the unorganized sector, which is actually declining. This is building up over a period of time,” Kumar told Indian journalist Karan Thapar.

In its recent assessment, the International Monetary Fund (IMF) has given a "C" grade to India's national accounts. In particular, the IMF has raised the issue of the government using 2011-12 as the base year as being outdated, the discrepancy between production and consumption data and the use of Wholesale Price Index, and not a Producer Price Index, to deflate many economic activities to derive real GDP from nominal GDP.

Indian Firms Falling Corporate Profits. Source: Bloomberg

Corporate profits of Indian firms are growing at a much slower pace than the 8.2% GDP growth in its most recent quarter. Net income for Nifty 50 Index firms likely rose 1.1% in the three months through Dec. 31 from a year earlier, according to analyst estimates compiled by Bloomberg. That would be the slowest pace in five quarters, weighed down by deteriorating margins for banks. Falling profits and declining currency are causing foreign capital to flee Indian markets. Foreign Portfolio Investors (FPIs) pulled out over $20 billion from Indian equities in 2025, marking a severe, sustained withdrawal that has continued into 2026. Net Foreign Direct Investment (FDI) has seen consecutive monthly outflows, including $1.67 billion in October and $446 million in November 2025. Investment banker Ruchir Sharma wrote about it in a Financial Times op ed titled "India needs to import more capital and export fewer workers". Ruchir wrote: "Most strikingly, corporate revenue normally grows (or shrinks) with the economy — in any country. But last year corporate revenue growth for listed companies in India decelerated to barely half the GDP growth rate"

Falling Indian Rupee. Source: Reuters

The source of the biggest error is the way India estimates the informal economy which, including agriculture, accounts for almost 45% of GDP. To do so, India uses the formal sector as a proxy to estimate the performance of the informal sector. But if the two sectors are moving in opposite directions, as has happened after demonetization, GST imposition and the pandemic, you could end up overestimating the unorganized sector.

Indian-American economist Ashoka Mody, author of "India is Broken", has argued that the current unemployment crisis in India is a direct result of the destruction of the informal sector, particularly the mom and pop stores that employed a large number of Indians.

Questions about the veracity of India's official GDP figures are not new. These have been raised by many top economists. For example, French economist Thomas Piketty argues in his best seller "Capital in the Twenty-First Century that the GDP growth rates of India and China are exaggerated. Picketty writes as follows:

"Note, too, that the very high official growth figures for developing countries (especially India and China) over the past few decades are based almost exclusively on production statistics. If one tries to measure income growth by using household survey data, it is often quite difficult to identify the reported rates of macroeconomic growth: Indian and Chinese incomes are certainly increasing rapidly, but not as rapidly as one would infer from official growth statistics. This paradox-sometimes referred to as the "black hole" of growth-is obviously problematic. It may be due to the overestimation of the growth of output (there are many bureaucratic incentives for doing so), or perhaps the underestimation of income growth (households have their own flaws)), or most likely both. In particular, the missing income may be explained by the possibility that a disproportionate share of the growth in output has gone to the most highly remunerated individuals, whose incomes are not always captured in the tax data." "In the case of India, it is possible to estimate (using tax return data) that the increase in the upper centile's share of national income explains between one-quarter and one-third of the "black hole" of growth between 1990 and 2000. "

Saturday, January 17, 2026

US Immigrant Visa Freeze For 75 Countries: Why Pakistan But Not India?

The US State Department has suspended processing of immigrant visas from 75 countries, including Pakistan but not India. This action followed President Donald Trump's social media post that listed, without context, the percentage of immigrant households from these countries that rely on the US government financial assistance. While Mr. Trump’s post singled out immigrants, the fact is that the term “financial assistance” as used by him includes social security and Medicare payments which are entitlements received by all senior citizens, both naturalized and US-born. It listed immigrant households from Bhutan (81.4%), Yemen Arab Republic (75.2%) and Somalia (71.9%) as the top three "Welfare Recipients". It also included Afghanistan (68.1%), Burma (59.2%), Bangladesh (54.8%), Pakistan (40.2%) and China (32.9%). India was not shown on this list. A US State Department statement explained the decision to suspend immigrant visa processing as follows: "President Trump has made clear that immigrants must be financially self-sufficient and not be a financial burden to Americans. The Department of State is undergoing a full review of all policies, regulations, and guidance to ensure that immigrants from these high-risk countries do not utilize welfare in the United States or become a public charge". A look at the detailed data shows that non-citizen immigrants consumed 54% less welfare than native-born Americans.

President Trump's Social Media Post on Welfare Receiving Immigrant Households. Source: X

It is important to understand that the data President Trump shared is for households, not individuals. It includes the entire household as recipients of government assistance even if a single individual in that household receives such assistance. Second, the definition of "welfare recipient" in Trump's data includes all government programs, including the entitlement programs like social security and medicare which all senior US citizens receive. Third, the households on non-immigrant visas which are ineligible for government assistance but are counted in the total number households surveyed for this data. For example, millions of H1B visa holders and foreign students on F-1 visa from India are not eligible for such assistance, resulting in a significantly lower percentage of Indian households receiving government assistance.

The median annual income of Pakistani-American households was $108,100 in 2023, higher than $105,600 for Asian-American households overall. The median annual income of Indian-American households was $151,200 in 2023, the highest among all ethnic groups in America. GCBE1, a visa consultancy, explains why certain groups, such as Indians, do not appear in Trump's list in the following excerpt:

"While the welfare chart provides a snapshot, it does not explain why certain groups appear or how participation is measured. Critics argue that without clear definitions of “welfare” or adjustments for income and immigration status, the data can be easily misinterpreted. Groups with high numbers of legal permanent residents and U.S. citizens in mixed-status households might show welfare usage even if non-citizen members are ineligible. Others point out that immigrant households may include U.S.-born children receiving benefits; yet these metrics are not broken down in the shared data".

Per Capita Welfare Consumption by Native Born vs Immigrants in US. Source: Cato

President Trump's post is part of his larger anti-immigration theme to please his MAGA base. But a Cato Institute study found that all immigrants consumed 21% less welfare and entitlement benefits than native-born Americans on a per capita basis in 2022, based on data from the Survey of Income and Program Participation (SIPP). Immigrants were 14.3% of the US population and consumed just 11.9% of all means-tested welfare and entitlement benefits that year. Here's an excerpt of the Cato study:

"The biggest myth in the debate over immigrant welfare use is that noncitizens — which includes illegal immigrants and those lawfully present on various temporary visas and green cards — disproportionately consume welfare. That is not the case. Noncitizen immigrants consumed 54 percent less welfare than native-born Americans. Non-citizens were 7.3 percent of the population and consumed just 3.5 percent of all welfare and entitlement benefits. In total, noncitizens consumed $109.4 billion in benefits in 2022".

Related Links:

Haq's Musings

South Asia Investor Review

Indian Illegal Immigrants Deported in Handcuffs

Ambassador Kishore Mahbubani: America Does Not Respect India

World Happiness Report: India Among Saddest Nations of the World

Balakot and Kashmir: Fact Checkers Expose Indian Lies

Top One Percent: Are Hindus the New Jews in America?

India in Crisis: Unemployment, Hunger Persist After Waves of Covid

Modi's Blunders and Delusions

India's Israel Envy: What If Modi Attacks Pakistan?

Pakistani-American Average Household Income Estimated At $150,000

Pakistan Navy Modernization

Pakistan's Sea-Based Second Strike Capability

Are Some Pakistanis Feeding Modi's Delusions of Grandeur?

Is the West Unwittingly Helping Modi Realize His Akhand Bharat Hindutva Dream?

Has Pakistan Lost All Wars?

Riaz Haq's Youtube Channel

PakAlumni Social Network

Wednesday, January 14, 2026

Indian NSA Doval Urges Young Hindus to Take Revenge on Muslims

In a recent speech to young Hindus in New Delhi, the Indian National Security Advisor Ajit Doval urged his audience to "avenge history". He talked about the looting and destruction of Hindu temples and many centuries humiliation suffered by Indians. Though he did not specifically say it, there was no doubt in the minds of his audience that he was talking about invaders like Mahmud of Ghazni, an Afghan Muslim ruler, who is said to have destroyed a Hindu temple in Somnath.

Indian Prime Minister Modi (Left) with NSA Ajit Doval

Anti-Muslim rhetoric like Doval’s has made Indian Muslims fear for their lives. It has also put India among top countries with greatest likelihood of mass atrocities, and raised security concerns among India’s neighbors. In its latest warning, the US Holocaust Museum has put three countries scoring higher than India. Myanmar holds the top spot, followed by Chad and Sudan. However, many high-ranking nations including Myanmar and Sudan are already dealing with ongoing mass killings, making India’s position particularly noteworthy as a potential new flashpoint.

For those interested in real history, it is important to understand that eminent Hindu Indian historian Romila Thapar has rejected the Hindu-Muslim framing of the destruction of Somnath. In her book "Somatha", she challenges the simplified story of purely Hindu victims and Muslim invaders, focusing on local Indian sources such as inscriptions, merchant biographies and court epics to reconstruct events. Other sources indicate that several Hindus, including Hindu generals, were part of Ghaznavi's army. Some sources also cite that Arab Muslim traders who had settled in Gujarat during the 8th and 9th century died to protect the Somnath temple against Ghaznavi's Army.

Mughal Emperor Aurangzeb, demonized by Hindu Nationalists, employed several high-ranking Hindu generals, most notably Raja Jai Singh I (of Amber) and Maharaja Jaswant Singh (of Marwar), who served as powerful mansabdars (military commanders) and held significant administrative posts, commanding large forces and participating in key campaigns against rivals like Shivaji Maharaj and Dara Shikoh.

Shivaji Maharaj, held by the Hindu Nationalists as an icon of Hindu resistance against Muslims, was crowned as the king despite opposition from local Brahmins. He had several Muslim generals in his army. In fact, he employed people of all castes and religions, including Muslims.

Hindu kings often attacked and looted temples built by other Hindu kings for the wealth stored inside the idols. Just three years before Ghaznavi's raid on Somnath in 1022, a general under Rajendra I, Maharaja of the Chola empire (848–1279) marched 1,600 kilometers north from the Cholas’ royal capital of Tanjavur. Chola warriors defeated Mahipala, maharaja of the Pala empire (c.750–1161), who was the dominant power in India’s easternmost region of Bengal. The Chola's celebrated their victory by carrying off a bronze image of the deity Shiva, which they seized from a royal temple that Mahipala had patronized. In the course of this long campaign, the invaders also took from the Kalinga Raja of Orissa images of Bhairava, Bhairavi and Kali. These, together with precious gems looted from the Pala king, were taken down to the Chola capital as war booty. This raises the question: Why is Mahmud Ghaznavi demonized but not Rajendra Chola's plunder of Hindu temples?

The real history contradicts Doval's assertion that Hindus have never invaded others, ignoring the fact that an unprecedented number of people were killed in the Kalinga massacre by emperor Ashoka. He also did not mention how the Buddhist and Jain temples were destroyed and Hindu temples built on their ruins. nor did he acknowledge the long-running and ongoing oppression of Hindus by Hindus in the name of caste.

Ajit Doval does not appear to be a serious man worthy of holding the sensitive office of India's national security advisor. He has no sense of history, nor does he understand how damaging his speech is for a diverse country like India. By parroting the divisive Hindutva narrative, Doval has alienated not only Indian Muslims but also India's neighbors. He is a total failure. India's failed national security policy is hurting India and Indians more than anyone else.

Tuesday, January 6, 2026

Pakistan Household Survey HIES 2024-25 Raises More Questions Than It Answers

Recently released HIES 2024-25 household integrated economic survey by Pakistan Bureau of Statistics (PBS) raises more questions than it answers. For example, it shows that Pakistani households are buying lower amounts of basic food ingredients like wheat, meat and eggs in the last four years, implying that people are eating less to cover other expenses, like electricity and gas. But it doesn't explain why the households have reported significantly lower purchases of these items than production reported recently by the PBS. What is the source of this discrepancy? Is the data flawed? Or, is it missing a new trend toward less home cooking? Is the young urbanized population buying more prepared foods? Are they ordering out more often using ubiquitous food delivery services? Let us try and understand it in more detail.

21% Pakistanis Buy Tandoori Nan. Source: Gallup Pakistan

Data Discrepancy:

There is a significant discrepancy in household data for per capita monthly consumption of basic food ingredients like wheat, meat and eggs. For example, the HIES 2024-25 reports 6.59 Kg of wheat consumption per capita per month, which translates into 79 Kg per person per year. The wheat production data from PBS shows 30 million tons or 120 Kg per capita in 2025. We know that Pakistan did not export wheat last year. So what happened to the 41 Kg per capita difference? It is 30% of the total production reported, too large to be explained away as waste in the system. It was most probably bought by food businesses and eventually consumed by Pakistani households. There are similar discrepancies in meat, eggs and other food data, with reported household consumption being far below production.

Household Food Items Purchase Data. Source: HIES 2024-25

Prepared Foods:

A 2025 Gallup survey revealed that 21% of Pakistanis buy tandoori naan. Pakistan's prepared food market is experiencing robust growth, with the Convenience Food sector valued at $6.91 billion in 2025, projected to grow at 5% annually, driven by Ready-to-Eat (RTE) meals and frozen foods, especially RTE/RTC (Ready-to-Cook) products like frozen snacks. Key trends include rising demand for time-saving, convenient options due to urbanization, growing health consciousness (organic/natural), and dominance by flexible packaging, with online delivery also expanding rapidly.

Urbanization in Pakistan. Source: World Bank

Urbanization:

The World Bank researchers have recently concluded that 88% live in urban areas. Their conclusion is based on satellite imagery and the Degree of Urbanization (DoU) methodology. The official Pakistani figures released by the Pakistan Bureau of Statistics (PBS) put the current level of urbanization at 39%. The source of this massive discrepancy is the government's reliance on administrative boundaries rather than population density and settlement patterns, according to the World Bank working research paper titled "When Does a Village Become a Town?".

Ultra-Processed Foods:

Ultra-processed foods (UPFs) like biscuits, sugary drinks, chips, and packaged snacks, are a growing concern in Pakistan. Such foods are contributing to rising obesity, diabetes, and heart disease. Obesity causes non-communicable diseases (NCD) which are now among the leading causes of death in Pakistan.

To deal with the obeseity crisis, several Pakistani pharmaceutical companies have started domestic production of generic versions of GLP-1 (Glucagon-Like Peptide-1) drugs Ozempic/Wegovy (Semaglutide) and Mounjaro/Zeptide (Tirzepatide).

Food Delivery Services:

Pakistan's food delivery market is experiencing rapid growth, projected to hit $2.35 billion in 2025, driven by high smartphone penetration, a young urban population, and increased convenience-seeking, with Foodpanda dominating but facing a growing trend of direct restaurant ordering and a demand for diverse, tech-enabled options despite past economic challenges.

Street Food Growth:

With rising urbanization, the street food sector in Pakistan is vibrant and growing. It is crucial for livelihoods and affordable food. Deeply embedded in culture, choices range from savory samosas and chaat to bun kebabs, pakoras, pani puri, and biryani, popular for convenience and taste.

Fast Food Boom:

Pakistan’s fast food industry is experiencing rapid growth, making it the 8th largest fast food market globally. With a large consumer base, the demand for fast food continues to grow, contributing to the economy in significantly. The industry’s annual growth rate stands at 20%, highlighting its rapid expansion and increasing consumer preference for quick-serve meals.

Summary:

The HIES 2024-25 report recently issued by Pakistan Bureau of Statistics implies that Pakistani households are eating less to save money to pay for rising energy bills. I think this is misleading for two reasons: 1. It does not explain why reported household consumption figures are significantly lower than per capita production of these food items and 2. It completely ignores the impact of rapid urbanization that is causing Pakistanis to change their eating habits, such as consuming increasing amounts of prepared foods.