Are Micro Lending Institutions Back In Business?

Are India’s microfinance institutions (MFIs) on a comeback trail? Data suggests the industry is recovering from the 2010 crisis triggered by a tough law that nearly banned the industry in the southern state of Andhra Pradesh.   The gross loan portfolio of MFIs rose 23% to Rs 21,245 crore in the year ended 31 March, … Continued

No Investment, No Growth. Simple.

India’s Prime Minister Manmohan Singh this week released a Report To The People on the achievements of the United Progressive Alliance (UPA) in the nine years that it’s been in Government.   In the report, he acknowledged the domestic slowdown but also attributed it to external factors. “India was among the fastest growing economies of … Continued

Financial Inclusion Seems To Be Working

A stated goal of financial inclusion seems to be working for the Government as well as the Reserve Bank of India.   Banking services reached 211,324 villages at the end of December 31, 2012, up from 67,694 villages in 2010 – an increase of 211%. As per Census 2011, there are 641,000 villages across the … Continued

Keep The Government Out Of Service Businesses, At Least

The demise of Margaret Thatcher is a good time to revisit the idea of state-ownership of businesses. Thatcher was adamant and pushed privatisation aggressively. Her approach came in for much criticism but the eventual outcome is not something everyone disagrees with.   India, on the other hand, has had a checkered history when it comes … Continued

India’s 93%, 437 Million That Holds Up The Economy But Lacks A Voice

  Highlights  *Out of 465 million workers in 2009-10, 437 million (93%) was in the unorganised sector * Over 90% of unorganised labour engaged in wholesale/retail trade *  This 93% of the work force accounts for, hold your breath, about 50% of GDP   It might surprise some to know that most of the debates on … Continued

Should We Go MAD Over CAD?

  Highlights * Largest component of Current Account Deficit is the difference between the value of imports and exports * Exports of petroleum products, gems and jewellery and transport equipment are going up * Gold demand may soften for two reasons: festival season is over and duty hike may be a dampener in the short … Continued

You Don’t Need High Growth To Fix Poverty

“In the past 8 years, our economy has grown at a record annual rate of 8.2%. We have ensured that poverty has declined much faster, agriculture has grown faster, and rural consumption per person has also grown faster.  We need to do more, and we will do more. But to achieve inclusiveness, we need more … Continued

Why The Government Needs A Plan To Fix Non-Plan Spends

“Government expenditure boosts aggregate demand and it has both good and bad consequences. Wisdom lies in finding the correct level of government expenditure” – India Finance Minister, P. Chidambaram, Union Budget 2013-14 Speech.   A look back at Government expenditure numbers over the last few years highlights the significance of the Finance Minister’s words in … Continued

Maharashtra Gears Up For Drought And Elections

The Budget for 2013-14 would be the last for the Congress-NCP alliance in Maharashtra before the elections next year.  And in a year when the state is facing an acute drought and water shortage across major districts, Budget 2013-14 has made special provisions for drought relief with an allocation of Rs 2,086 crore. The National … Continued

The Government’s Track Record On Revenue Is Better Than You Think

“The purpose of a Budget exercise – and the job of a Finance Minister – is to create the `economic space’ and find the resources to achieve various socio-economic objectives. Right now, the economic space is constrained because of a high fiscal deficit, reliance on foreign inflows to finance the current account deficit, lower savings … Continued