ET2013 ⁽⁶⁾

The debate between Amartya Sen and Jagdish Bhagwati began with the identification of Bhagwati with growth and Sen with redistribution.Read full article The debate between Amartya Sen and Jagdish Bhagwati began with the identification of Bhagwati with growth and Sen with redistribution. Later, most converged to the view that both sides value both instruments but with different emphases. But this is obfuscation. Taking his latest book An Uncertain Glory, coauthored with Jean Dreze at face value, I accept that Sen recognizes the importance of growth for poverty alleviation. He writes, “Economic growth is indeed important, not for itself, but for what it allows a country to do with the resources that are generated, expanding both individual incomes and the public revenue that can be used to meet social commitments.” Rising incomes and revenues as a consequence of growth were the two themes that Bhagwati had expounded in his 12th Vikram Sarabhai Memorial Lecture delivered 26 years ago. Notwithstanding his claim to the contrary, in his latest book, Sen was far from assigning this role to growth in the fight against poverty.

In India, ultra-high restrictions on worker layoffs in the organised sector encourage firms to operate in the unorganised sector.Read full article A recent visit to South Africa has provided me the opportunity to study its economy. With a population of just 51 million, South Africa is smaller than 10 Indian states. Its per capita income, at $8,000, is more than five times that of India. Despite these differences, there are striking similarities between the two economies. While India has 90% or more of its labour force in the informal sector, South Africa suffers from 25% unemployment. Both outcomes can be traced to labour-market inflexibilities.

2 industrial tragedies in B'desh, have led activists to renew their campaign to force MNC's to take greater safety measures.Read full article Two recent back-to-back industrial tragedies in Bangladesh, a factory fire that claimed 117 lives and a building collapse that resulted in 1,127 deaths, have led activists and media persons around the world to renew their campaign to force multinational retailers such Wal-Mart and Carrefour to take greater responsibility for fire and structural safety in the factories from which they buy their products. Feeling the heat, a set of predominantly European retail chains, including Carrefour, Benetton, Marks &Spencer, El Corte Inglés, H&M and Inditex, have capitulated and signed an agreement accepting responsibility for rigorous independent inspections in the factories. They have also committed to paying for fire safety upgrades such as fire escapes. Most US companies, including Wal-Mart, have stayed out of the agreement. The urgency of actions to prevent these tragedies can be scarcely underestimated.

According to the advance estimate that was released by the Central Statistical Office sometime back, GDP growth during the second half of 2012-13 is expected to be just 4.6%.Read full article News on the Indian economy has been worse than even what the pessimists had predicted. According to the advance estimate that was released by the Central Statistical Office sometime back, GDP growth during the second half of 2012-13 is expected to be just 4.6%. This is one of the worst growth performances of the Indian economy in the post-reform era. The UPA had inherited a robust economy with the GDP growing at 8.5% in 2003-04. Absent a miracle, it will now bequeath its successor government an economy at its weakest in many years. This debacle in growth performance has brought India sceptics back to surface.

Sonia Gandhi ensured that the PM pushed the bailout through Cabinet to avoid trouble for her own and son Rahul’s election from UP in 2014. Read full article My last visit to New Delhi coincided with the elections in Gujarat. While trying to catch up with television in my hotel room, I noticed a campaign commercial. It opened with a song whose opening line translates as, “The nation seeks account of the misery inflicted over the last 10 years.” Although the reference to 10 instead of eight years should have served as a clue, my immediate reaction was to wonder why the Gujarat chief minister Narendra Modi was running his election campaign against the Congress in Delhi. As the commercial progressed, I realised my mistake: It was being run on behalf of the Congress with Modi as the target. But that begged the question why the Congress was challenging Modi in Delhi even before he had emerged as the leader of his party? And wasn’t this a case of the pot calling the kettle black since one could equally take the…