The Indian Economy Blog

Archive for August, 2005

Wealth Creation, Not Wealth Substitution

Wednesday, August 31st, 2005

CK Prahalad writes in the Wall Street Journal (subscription link): There is an inherent paradox in the debate about poverty alleviation that escapes even the most sophisticated observers in the West. Consider the conventional thinking about China and India: They are seen as a threat to the West. The fear is not only about “exporting [...]

More Commie Hypocrisy

Sunday, August 28th, 2005

Not that we needed further proof, but here is yet another story in the Indian Express that exposes the Left’s profound hypocrisy in India, especially the national leadership’s attacks on the marginally progressive CM of Bengal. What’s their beef with him this time? He’s talking to the Salim group of companies in Indonesia, known for [...]

Reading Dr Manmohan Singh’s Interview

Sunday, August 28th, 2005

It is always instructive to learn what our policy-makers are thinking. Prime Minister Dr Manmohan Singh is especially edifying since he is at the helm of the ship of the Indian state. I therefore recommend the recent interview (Aug 16th, 2005) of Dr Singh by Rajat Gupta published in the McKinsey Quarterly. (Reuben reported the [...]

A Case For Privatising Infrastructure

Saturday, August 27th, 2005

TN Ninan writes in Business Standard: Delhi’s power supply controversies tell us more than we realise. There are three complaints: the power tariff hike is unwarranted; the private distribution companies (or discoms) that came in three years ago are making profits without showing efficiency gains; and the overall power situation is still unsatisfactory. What do [...]

How does China do it? Hint: Not free-market economics

Saturday, August 27th, 2005

Much as I am in sympathty with the generally libertarian outlook of this blog, I am not sure that a laisse-faire (free markets, enforce property rights etc.) gurantees quick economic growth. Take China and India. In China, the state is very actively involved in economic activity-from building infrastructure to an active industrial policy. Yes, inefficiencies [...]

Matching Outcome To Intention

Friday, August 26th, 2005

The Indian Express reports: If all goes according to plan, in May 2006, citizens will have the first quantifiable indication on just how the government is spending the money it collects in taxes. In a first, Finance Minister P Chidambaram today tabled an “Outcome Budget” in Parliament that seeks to pinpoint scheme-wise targets, quarter-to-quarter, on [...]

Busting H-1B Myths

Friday, August 26th, 2005

The Wall Street Journal speaks out against a cap on H-1B visas, and in favour of letting market forces decide. It writes: Contrary to the assertions of many opponents of immigration, from Capitol Hill to CNN, the size of our foreign workforce is mainly determined by supply and demand, not Benedict Arnold CEOs or a [...]

The McKinsey Quarterly Interview with Manmohan Singh

Thursday, August 25th, 2005

Rajat Gupta, the former CEO of McKinsey, sat down with PM Manmohan Singh for an interview the day after his Independence Day speech. While reading Singh’s extremely well articulated views, a couple of things stand out. Manmohan Singh does not need lessons from any of us on what needs to be done to unleash the [...]

Flat, Round, Whatever, Dude

Thursday, August 25th, 2005

In an old article I just came across, Kaushik Basu writes: There is a story of a prospective school teacher who was asked during an interview by the principal of a conservative religious school, “Is the earth flat or round?” The hapless teacher looked around at the faces of the interviewers for hints and, not [...]

Knowledge @ Wharton Special on India’s R&D

Wednesday, August 24th, 2005

Following in the wake of the Businessweek cover story, Knowledge @ Wharton has a special issue out on the rise of India as an R&D hub. India has long enjoyed a reputation as a destination for IT and business process outsourcing. Now, the country is fast emerging as a major center for cutting-edge research and [...]

A Closed Space

Tuesday, August 23rd, 2005

Pratap Bhanu Mehta writes: There is half a truth to the maxim that when a position reflects consensus, it is probably a good reason to oppose it. But, more seriously, the kind of consensus we have suggests that the political space, for all the noise it generates, is relatively closed, ideologically. We often worry about [...]

Energy security

Tuesday, August 23rd, 2005

I have a slightly different take from Blue Sky’s on the subject of overpaying for oil companies. While I don’t know whether we are anywhere near peak oil (we seem to start fretting over this whenever oil prices reach stratospheric levels) , I believe that over the next several years oil prices will continue on [...]

The Winner’s Curse

Tuesday, August 23rd, 2005

China outbid India to acquire PetroKazakhstan Inc, Kazakhstan’s third largest oil producer, after its flagship company CNCP raised its offer higher than the Indian price. China National Petroleum Corp, which trailed Oil and Natural Gas-Mittal Group combine when price bids were made on August 15, raised its bid to $4.18-billion to acquire PetroKazakhstan, a Canadian [...]

Six Eggs A Year

Tuesday, August 23rd, 2005

A common canard of the Left: Rural India is in acute distress, which is bound to turn to turmoil if its crisis is not addressed. It is not too late. There is a strong case for a universal employment guarantee and a universal Public Distribution System. This is from the strap of a recent op-ed [...]

Debt Collection In India

Saturday, August 20th, 2005

The BBC reports A bank in India has decided to publicly shame defaulters in order to recover outstanding loans. Employees of the Urban Co-operative Bank in the eastern state of Orissa have begun staging noisy demonstrations outside the home of defaulters. Armed with posters, they kicked off the loan recovery drive outside the homes of [...]

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