The Indian Economy Blog

Archive for October, 2006

The Corus Deal and FDI flows

Wednesday, October 25th, 2006

We haven’t really commented on the TATA-Corus deal, partly because the news media was saturated with coverage and there’s nothing really to add. Suffice to say that from a strategic standpoint, it makes perfect sense given Tata’s ability to produce low-cost steel. I’d say both sides got a good deal with Corus shareholders getting a [...]

Demographic Cognitive Dissonance

Saturday, October 21st, 2006

People who don’t practice what they preach are not necessarily hypocritical. Perhaps they are merely not sufficiently intelligent to realize that what they do is inconsistent with the logical implications of what they preach. This gap between what they insist to be true while doing something which reveals their words to be false can be [...]

Microfinance, Hurricane Katrina And Rural India

Thursday, October 19th, 2006

Mohammad Younus has an excellent piece in the Wall Street Journal on how microfinance can be used to rebuild the areas affected by Hurricane Katrina. But can microfinance work in all conditions? I don’t know much about the local economies of New Orleans or Mississippi, but it’s not been a roaring success in India yet. [...]

Of Knowledge-based Interventions In Agriculture

Thursday, October 19th, 2006

How much of Dr Manmohan Singh’s talk on reforming agriculture will get translated into action? Inaugurating the Second Agriculture Summit 2006 organised jointly by the Ministry of Agriculture and FICCI, the Prime Minister declared that the endeavour of his government would be to bridge each of the four deficit viz. the public investment and credit [...]

Investment And Infrastructure In India

Thursday, October 19th, 2006

Last week Cherian Thomas and Anand Krishnamoorthy had an article on Bloomberg where they suggested that lack of clear investment rules may impede the inflow of investment funds which could make possible the truly daunting programme of infrastructural works which are needed in India between now and 2010. Indian Prime Minister Manmohan Singh may struggle [...]

Trend Growth In India

Saturday, October 14th, 2006

Prashant wrote to me earlier this week to bring a recent blog post (and Business Standard article) from Ajay Shah to my attention. Essentially Ajay is arguing the following: “a lot of what is going on is owing to procyclical (i.e. destabilising) macro policy. I emphasise the distinction between the long-term trend and the business [...]

Lavish Weddings Are Good For The Economy

Friday, October 6th, 2006

When populism is so stupid, what does it say about people? IANS reports: The Kerala Assembly united on Thursday to condemn ostentatious weddings in the state and came out with suggestions to curb wedding expenses. With the increasing demand that the state government should intervene to curb extravagance in marriages, Law Minister M Vijayakumar said [...]

Outsourcing One More Time Around

Friday, October 6th, 2006

Manmohan Singh is quoted today as suggesting that India *will* create 10 million new jobs in five years from the global outsourcing business: “New business and service relationships are being forged across continents in a manner unimaginable even a decade ago,” Singh told a seminar on trade in services in New Delhi today. “I do [...]

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