Editorial 1. Reasoned Optimism
Context: Economic Survey presents an upbeat assessment of India's economy. But there are more short-term challenges than it lets on.
Introduction
- The Economic Survey 2022-23, the annual flagship document of the Ministry of Finance, is carefully optimistic in its assessment of the prospects of the Indian economy over the coming year.
- The optimism is striking, particularly when the global situation isn’t exactly rosy, with tightening financial conditions and subdued trade growth.
Projections by the survey
- The Survey has projected the Indian economy to grow at 6.5 per cent in 2023-24, a tad lower than the forecast of 7 per cent for the ongoing financial year.
- This assessment is at odds with the more pessimistic forecasts by international agencies and other independent evaluations.
Forecasts by international agencies and other independent evaluations
- In its latest World Economic Outlook released on Tuesday, the International Monetary Fund has pegged India’s economic growth to slow down from 6.8 per cent in 2022 to 6.1 per cent in 2023.
- On similar lines, rating agency Crisil has projected growth at 6 per cent, while investment house Nomura has pegged it even lower.
- While the Survey’s projections of the decline in growth may not necessarily be incorporated in the Union budget, they nonetheless provide an insight into the government’s views on the state of the economy.
Basis of Survey’s growth prognosis
- It is based on expectations of robust domestic demand and a pick-up in capital expenditure. It notes that as export growth moderated in the ongoing financial year, domestic consumption rebounded, providing a fillip to economic activity. However, this was largely due to the release of “pent-up” demand.
- While the Survey expects this rebound to have “lasting power”, to what extent it is sustainable — in the context of elevated inflation eroding purchasing power and an uneven recovery impacting sales of both consumer durables and non-durables — is debatable.
- On investment activity, the Survey highlights the increasing trend in project announcements and private capex spending. While there are some signs of an uptick in the private investment cycle, these indicate a skew in favour of specific sectors, not a broad-based pick-up.
- Moreover, the continuing downturn in exports will have ramifications. While the Survey does acknowledge the prospects of sluggish exports, a detailed articulation on the risks to growth from a slowdown in the developed economies — if interest rates remain “higher for longer” — is absent.
Conclusion
- The Survey has devoted an entire chapter to India’s medium-term growth outlook. The broad conclusion is encouraging — the twin balance sheet crisis does not appear to be an impediment to growth anymore.
- Both corporate and banking sector balance sheets are in far better shape, and the credit cycle is poised for an uptick. The Survey emphatically states the Indian economy is well placed to embark on a growth trajectory similar to what it experienced post 200
Editorial 2. Where she shows the way
Context: India@75, Looking at 100, Women must be empowered to take charge of their lives
Introduction
- There are no two opinions on the fact that women have progressed since Independence. We now understand and acknowledge that the nation cannot progress if half of it is held back.
- From laws enabling women to own property and safeguard their interests, to being economically independent and leaving their mark in the business space, Indian women have seized the reins and developed a vision in tune with global developments.
Important data points
- Only 15 and 14 per cent of MPs in the Lok Sabha and Rajya Sabha, respectively, are women;
- 11 women feature in the council of ministers;
- just 26 per cent of the selected candidates for Civil Services were women;
- only 23.3 per cent are in the labour force;
- only 20.37 per cent are MSME owners;
- only 10 per cent of start-ups in India have women founders; and women only contribute 18 per cent to the nation’s GDP.
Moving towards a holistic approach
- The discussion now needs to evolve to understand the “whys” along with the “whats” embedded in percentages or numbers.
- The debate around women’s participation must progress beyond the currently used metric of assessing the availability of opportunities, solutions, and avenues, which is, in my opinion, a unidirectional approach.
- A more holistic approach would entail an assessment of the comprehensiveness, feasibility, applicability, and accessibility of resolutions — whether in the form of a law, policy or directive — to propel women towards a promising future.
What we need to strive for?
- At the same time, every step in this direction must have social justice, equality, and inclusivity at its heart. We need to strive to ensure that every woman from a disadvantaged background has the same access to empowering measures as a woman coming from privilege does.
- We need more regional voices in strategic policy-making decisions, more rural women taking control of their economic decisions, and more women overcoming impediments and climbing the leadership ladder.
- We need to keep reiterating the same question: What is being done for the women in the country, and is it adequate? A policy is only good as the number of lives it impacts.
Tamil Nadu and its history
- Tamil Nadu and its history are laced with the impactful legacies of leaders like Thanthai Periyar, C N Annadurai, and Kalaignar M Karunanidhi, who were not only proponents of equality and social justice for women but also set up practical examples for India and the world to emulate.
- Not only did Kalaignar discuss issues affecting Indian widows in his screenplays, but he also announced financial assistance schemes for them.
- He instituted the Women Entrepreneurs Scheme, the Women’s Small Trade Loan with Savings Scheme, reservations for women in government jobs and panchayat elections, marriage and maternity benefits, and other policies that have catapulted Tamil Nadu onto the path of development. His vision is what Tamil Nadu Chief Minister M K Stalin has been furthering.
Conclusion
- In the next 25 years, I hope for egalitarianism and justice to be the light of the nation. I fervently hope that we catapult more women forward, not only by empowering them to take charge of their lives, but also to impact the lives of thousands of other women, thereby initiating a cycle that creates space for inclusivity, empowerment, and development.