[psmenon]

I am still worried when we discuss this virus as China virus rather than Covid-19, with whatever is happening around the world a new can virus can just pop up from any part of the world - it could be from India too! I am not comfortable with the approach to blame a whole country for being the origin of a VIRUS.

[hothatchaway]

With the current challenges faced by all, it becomes difficult to set aside our inherent beliefs and biases even. I have made no secret of mine, which is my misgivings towards the policies and perceived intent behind those of the current administration.

I will try and focus on the thread subject, which is to do with employment destruction due to the current sanitary measures. Focussing on India's economic trajectory over the last half decade, it seems that we have not been able to add more jobs to the formal sector. With my limited understanding of economics, these could be manufacturing jobs, both white and blue collar and services, which straddles many industries. The farm sector can be excluded from this discussion as it is not done on an organized scale in India, not big enough to be meaningful anyways.

I feel that a crucial reason behind that is we haven't seen too many homegrown enterprises coming up which can conquer new markets outside India and hence generate more jobs in India also. In manufacturing and especially in automobiles, I am not aware of any revolutionary strides made by the likes of the tatas, the mahindras and the bajajs. Tata did acquire JLR but I don't think it's a serious competitor globally. Foreign OEMs manufacture a large number of small cars in India, but I do not understand enough about the economics of that model to gather why that isn't translating into incremental job creation. Or perhaps it has and we can be hopeful.

In services, Infosys, Wipro and TCS are behemoths and drove job creation for over a decade. But I don't believe they are anywhere in the league of some of the American product companies like FB and Twitter. We don't look like having an Intel or a QC anytime soon. Having worked for one, I can state that having a world class company with leading products add a lot of HQ level jobs apart from the obvious benefits. I know reliance is making a lot of waves with Jio, but I am not aware of it's employment generating potential.

With regard to leisure, education and healthcare, there has to be a lot of potential. I don't know what percentage of these account for in the overall services pie, but I just don't see why more jobs are not getting created (if they really aren't) with our market size. One sees faculty vacancies being advertised with unfailing regularity. What about banking? Is an HDFC/ICICI at par with an erstwhile HSBC or a Stanchart. If not then why?

Is it lack of sufficient quality higher education which leads to inadequate supply? Is it lack of organizational skills both at a company and at an industry level? While we have lagged behind labor and land reforms, but the services companies don't really have that excuse. Chinese or even Korean companies enjoy a lot of government patronage, but that is not true of American companies. Or is it that the current global economic structure is such that marqué companies leading an industry or even economy wide revival is difficult.

I know that I have rambled quite a bit. I don't know and am not sure if the solution to all of this is public policy. If not then I think we are doomed to repeat this debate over and over again.

[whitewing]

The pent up frustration, desperation of our country going downhill (and pulling fellow citizenry along) is well expressed by a lot of others. All the more telling in an apolitical forum as this.

And at loggers heads are the vast majority (atleast of the survey participants) https://www.indiatoday.in/mood-of-th...on-survey-2020are under the impression that whatever is happening is the best that could happen - in the current, harsh circumstances.


To me this is a stark reiteration of the low level expectation that people have from the Govt.

[Samurai]

Originally Posted by hothatchaway

In services, Infosys, Wipro and TCS are behemoths and drove job creation for over a decade. But I don't believe they are anywhere in the league of some of the American product companies like FB and Twitter.

Are you talking about job creation or something else? TCS alone has 450K employees while FB+Twitter has only 50K employees.

[fordday]

Originally Posted by whitewing

And at loggers heads are the vast majority (atleast of the survey participants) https://www.indiatoday.in/mood-of-th...on-survey-2020are under the impression that whatever is happening is the best that could happen - in the current, harsh circumstances.

In that link the answer to the question "What has been the single biggest achievement of Modi govt?" shows where our priorities lie. See the top two responses of this question.

Either the results are skewed or we the people are completed skewed by all the hoo haa.

[hothatchaway]

Originally Posted by Samurai

Are you talking about job creation or something else? TCS alone has 450K employees while FB+Twitter has only 50K employees.

I was talking about incremental job creation overall. While a TCS or even the Indian railways employ a humongous number, according to the economic survey which this thread is based on, the overall rate of employment in the formal sector has not gone up. Which perhaps means that these companies and or the sectors have not been able to generate more business.

[kovilkalai]

I understand that we want to blame someone for this pandemic. China is responsible for a lot of things related to the pandemic - withholding information, lying to WHO among others. However, the claim that this virus was made in a lab is disputed. Not just by China, but by scientists around the world. The reason something like this becomes news is because of confirmation bias. Some semi-credible person says something that we all subconsciously believe and we tend to agree with it even when there are dozens of other equally qualified (if not more) scientists saying the opposite.

Twitter has even been blocking Donald Trump's tweets of late if they believe that the tweet puts forth a false narrative on the Coronavirus. That is the reason they blocked this woman's account. Last I checked, Twitter is blocked in China. There is no incentive for Twitter to pander to the Chinese.

It is easier for us to imagine Bond villains conspiring to attack the world - which is why we dream up all these explanations. Unfortunately, it doesn't work that way. By killing the world economy, China indirectly shoots itself in the foot because a big part of its GDP is driven by exports - something which would come to a grinding halt when the world goes on lockdown. Further, they are creating incentives for countries and companies to derisk their manufacturing centres in China. A lot of companies and countries are looking into this. Policymakers in large countries are not this short-sighted (unless you are Donald Trump, of course)

[ZenMaster]

Things I have understood from the discussions in the thread:

1)Some sectors have been affected really badly, some have seen growth while some have been affected slightly (and depending on your point of view and nature of work or business, the future seems either bright or bleak)

2) Most of us live in a bubble(both physical and philosophical), with our real experience coming from a limited number of interactions or our immediate surroundings which could be totally different to another person's bubble. This affects the perception of people and they form opinions based on them.
Because of this people with contrarian views cannot understand/accept the logic behind the other view.

3) We try to fill the Gaps in our direct experience with information from our favourite news sources (which based on your political/regional affiliation is either extremely positive/negative if you have any interest in the economy (i.e. members of this forum) or otherwise is suppressed by Bollywood or local political scandals)

4)The thread has veered from discussing job losses to crtisizing/defending PM cares fund which deserves another thread IMHO.

5)Some believe that the govt. Deserves crticism while others believe its the fault of the Citizens.

6) Some members (on both sides) believe in valid critisicm and debate while a few (again on both sides) believe in Name-Calling.

Everyone's argument have some merit, the good in one's opinion should not be overlooked because he/she doesn't believe in your preferred ideology/political view/doesn't support your favourite politician.

Quoting my favourite line from the Terminator series, Only one thing is for sure:
"THE FUTURE IS NOT SET"

It depends on what you make it, whether for better or worse.

Being pessimistic is not wrong, neither is being optimistic.
The first will benefit one set of people, the latter will benefit another. True progress only comes when you consider the criticism of the pessimists and work on it and use the means at your disposal to fix things to aleviate the peoples fears. That will help you bring confidence and hope to people and thus turn even the worst situations to your advantage.... like an optimist.

Let's prepare for the WORST, and hope for the BEST. Not the other way round.

Peace

[ashish.uno]

Originally Posted by Dry Ice

The size of the fund aside, what problem does this *new* fund solve that PMNRF could not?

The major difference is in the utilization of fund.
The PMNRF is primarily used for natural disasters like floods, cyclones, earthquakes etc. Whereas PMCares is specifically constituted for expenditure related to Wuhan/Covid virus.

The PMNRF managing committee includes the President of the Congress party specifically and the PM has the sole discretion in the management of the fund. In 1985 the then PM also appointed a 'secretary of the fund' who has the authority to operate the bank accounts of the fund on his behalf.

IIRC the PMNRF still functions without a trust deed, essentially it gives unlimited powers to the PM with Zero accountability.

Business standard also coverd in its article titled 'Why Modi's PM CARES is more democratic than PM National Relief Fund'

In PMCares there is also a provision to set up an advisory board of not more than 10 persons — selected by the trustees from among the medical practitioners, healthcare professionals, academicians, economists and lawyers.
The responsibility of the trustees in PM-CARES has been defined, unlike in the Prime Minister National Relief Fund (PMNRF). The latter has no provision of an advisory board.

The current PM will change in next 10-15 years, it is a farsighted move on the part of current govt. to ensure that the decision makings rests with the trustees and not with a single individual, however powerful he may be.

[AirbusCapt]

When the beloved PM comes on TV and says going out is inviting death, he sets the tone for the future. All his loving masses now believe that being infected by a virus with a 0.5% fatality is like getting stage 4 cancer, a death sentence.
The long 3 month unecessary song and dance program called a lockdown, also sets stage for companies to remove deadwood and cut costs. Covid is a perfect excuse. Both the above set the stage for a perfect storm. Lockdown and job loss makes people cling on to their savings and stop spending unless on essentials. This creates further economic complications leading to further job losses.
What could the government do better? IMO the government was actually a bit helpless and caught off guard in this crisis. The lockdown was called for very early, however the infrastructure (the whole purpose of the lockdown) was never really made. When the economy started hurting badly, there was too much hurry to unlock everything. This coupled with people wanting to escape, increased the rate of infections. So now we have a collapsed economy and the highest cases of covid in the world.

[Cessna182]

Originally Posted by ashish.uno

The PMNRF managing committee includes the President of the Congress party


.

A humble and sincere request- please stop sharing selective news to suit a narrative. An article in The Hindu, which is a newspaper that even people preparing for government jobs vouch for, clearly states "The PMNRF was originally managed by a committee which included the Prime Minister and his deputy, the Finance Minister, the Congress President, a representative of the Tata Trustees and an industry representative. However, in 1985, the committee entrusted the entire management of the fund to the Prime Minister, who currently has sole discretion for fund disbursal. A joint secretary in the PMO administers the fund on an honorary basis."
https://www.thehindu.com/news/nation...le31546287.ece

In any case, I repeat that government employees were asked to donate their day's salary and many donated a month's salary. If you take money from PSUs and govt. employees, you don't think you're worthy enough to be scrutinized by govt. auditors like the CAG?

I won't make any more off topic posts, and please delete if this is inappropriate. My sole intention was to counter the wrong fact stated. Thanks.

[ABHI_1512]

Originally Posted by ashish.uno

The major difference is in the utilization of fund.
The PMNRF is primarily used for natural disasters like floods, cyclones, earthquakes etc. Whereas PMCares is specifically constituted for expenditure related to Wuhan/Covid virus.

The PMNRF managing committee includes the President of the Congress party specifically and the PM has the sole discretion in the management of the fund. In 1985 the then PM also appointed a 'secretary of the fund' who has the authority to operate the bank accounts of the fund on his behalf.

IIRC the PMNRF still functions without a trust deed, essentially it gives unlimited powers to the PM with Zero accountability.

Business standard also coverd in its article titled 'Why Modi's PM CARES is more democratic than PM National Relief Fund'

In PMCares there is also a provision to set up an advisory board of not more than 10 persons — selected by the trustees from among the medical practitioners, healthcare professionals, academicians, economists and lawyers.
The responsibility of the trustees in PM-CARES has been defined, unlike in the Prime Minister National Relief Fund (PMNRF). The latter has no provision of an advisory board.

The current PM will change in next 10-15 years, it is a farsighted move on the part of current govt. to ensure that the decision makings rests with the trustees and not with a single individual, however powerful he may be.

Sir, please check from authentic sources about the PMNRF instead of using dubious sources. I humbly request you to please read up before coming up with incorrect informations on this esteemed forum.

[Dry Ice]

Originally Posted by ashish.uno

The current PM will change in next 10-15 years

Right, that explains it.

Thanks!

[Samurai]

Originally Posted by poloman

I am not against socialism or liberalism, but against liberalism propagated by elites. These people who sit in their glass houses declare that they are with poor. They are against all government policies whether good or bad.

Why are these folks relevant in our discussion?

Originally Posted by poloman

What the Govt can do to kick start demand? Put more money in to pockets of people by cutting taxes or direct cash transfer?? Experts say in these situations, that may not work, people will simply save the money. So what is the solution?

I don't know about these experts. People who can afford to save, don't need the money that badly. Direct transfer should be to BPL kind of families, who will spend it right away and get the money circulating the economy. Velocity of money is what gets the economy moving.

If you give ₹10C to a guy who already has ₹10C, he is not going to change his spending pattern. Worse, he might spend it on imported items. But if you give the same ₹10C as ₹10,000 each to 10,000 people who badly need money to pay for essentials, they will spend it within a week. And that money moves all round. It creates demand at grass root level.

But if the government wants to create demand for higher level services and goods, they have to consider fiscal spending. Don't leave it all to FDI to fund entrepreneurship in India. Their priority is not job creation in India, if even that is one of the side effects. Government can finance large projects with job creation as a condition. The idea is to create demand for various kinds of services and goods. Risk takers will start businesses to take advantage of the demand created by the projects, and that creates jobs. And people who get those jobs will spend and create further demand.

[poloman]

Originally Posted by Samurai

Why are these folks relevant in our discussion?

I wonder some of esteemed forum members are veering in that path

Originally Posted by Samurai

Why are these folks relevant in our discussion?

I don't know about these experts. People who can afford to save, don't need the money that badly. Direct transfer should be to BPL kind of families, who will spend it right away and get the money circulating the economy. Velocity of money is what gets the economy moving.

The problem currently we have is a little peculiar. There is no dearth of demand in the basic sectors. There is enough supply as well.
The problem is in the discretionary spending. Sectors like travel, restaurants, eating out, fashion, high street retail, real estate etc are in very bad shape. This is what keep your economy chugging. The services sector accounts for around 55% of GDP, Industrial 30% and agriculture around 15%. How to make people do more discretionary spending is the major challenge with Govt.

Innovative schemes like UK government's 'eat out to help out' can be a good example which would be beneficial. Give tax credits and discounts from govt for spending not tax cuts.


These arguments can go on till eternity. I hate politics sneaking in on this forum. Already we have so much hatred and divisions in the real world. Don't want that to happen on this forum.
So excusing myself.