Daily Chart

[trackwhack]

[Many of you who read the Economist (highly biased and skewed content but popular nevertheless) may have noticed their daily chart feature. I wanted to put together something similar for DFI. Data will pertain to Indian interests. I hope to do this on a daily basis barring weekends. Charts will be posted in the relevant sub-forums]

Today's Chart looks at our trend of Forex reserves. India saw a surge in Forex growth in the calendar year 07 upto mid 08. Then the financial crisis and a lot of other events resulted in the Forex reserves hitting a brick wall. In mid-2008, we had a Forex to Nominal GDP ratio of 26%. Today we are languishing at 16%. The chart shows the trend of Forex Reserves, split by the principal components of currency and Gold (I have not included line charts for Special Drawing rights and IMF reserve positions)

Now here are some interesting considerations.

Yes, there has been no significant FDI or FII inflow from a net perspective since Lehman went down. This is what the RBI cites when explaining Forex. However, what is never discussed is the $50 billion a year in overseas deposits which literally dwarf the FDI/FII component.

Is it financial mismanagement or weak policy measures that is resulting in this stagnation of Forex Reserves. To put things in perspective, our Forex reserves wont last us 6 months of balance of payments if there is a financial catastrophe considering our cumulative public and private debt is 70% of our GDP. Anything less than 30% in the ratio of GDP to Forex reserves is weak, in my opinion.

 

[trackwhack]

Daily Chart_2nd Dec 2011 - Forest Coverage

India's growing population having a devastating effect on Forest area is a line often towed by the media. This is a trend of Forest area in India for the last 2 decades. Data points are few as this is measured only once in five years apparantly.

We still have a long way to go in terms of reforestation. But with a more stable economy and over 15% of fallow and brushland in the country, our opportunity to increase the forest cover is quite significant.

 

[agentperry]

dont know how to fabricate silicon chips but are PhD in fabricating records. 23% my foot

 

[W.G.Ewald]

Same deal in the States. The news media here may finally have given up since some have claimed that we have more trees than when the Pilgrims came. The habitat we have lost how ever is much of the prairie.

 

[The Messiah]

That graph is deceiving though! The bars make it look like forest area is growing 10% every five years when infact its only grown by 1.5% over 20 years.

 

[trackwhack]

dont know how to fabricate silicon chips but are PhD in fabricating records. 23% my foot

Yeah, the Worldbank is actively propping up these numbers.

That graph is deceiving though! The bars make it look like forest area is growing 10% every five years when infact its only grown by 1.5% over 20 years.

I included data labels to compensate, but I acknowledge the critical view. Will expand the scale to 100% henceforth.

 

[trackwhack]

Daily Chart_5th Dec 2011 - Agricultural Labor and GDP

The agricultural sector has over the years been the weakest driver of growth. As other economic sectors surge ahead, agriculture seems neglected and agricultural productivity on a per capita scale in India is still among the lowest in the world. As India surges towards a non-agrarian economy, its labor force continues to be overwhelmingly agrarian. A comparison of the agricultural sectors contribution to India's GDP against the labor force employed in this sector has a story to tell.

In 2010, more than 50% of India's population depended on 16% of India's output.

* 2009 Labor force is an estimate and census numbers are awaited.
* Agricultural Labor force includes both growers and laborers

 

[lcatejas]

Its 100% sure ...it will go down to 6% ..coz we have a gr8 person called sharad Pawar as an agriculture minister....

 

[trackwhack]

Daily Chart_6th Dec 2011 - Growth of India's Oil Shortfall vs Growth of GDP

The single biggest driver of imports and hence the biggest drain on our Forex is Crude Oil. In 2010, India faced a shortfall of 2.5 million barrels of oil a day. While production was at 750 thousand barrels a day, Consumption was pushing 3.25 million barrels a day. Due to our low reserves (and high dependence) on oil the shortfall is bound to grow as long as our GDP continues to grow. But has our GDP growth managed to keep pace with the growth in the oil shortfall?

A comparison of the two shows that since 2000 we have more or less managed to keep things under control. The dip in growth of oil shortfall in 2010 was a result of Cairn India starting to pump oil from the Rajasthan rigs. At between 70 and 100 thousand barrels a day, it hardly made an impact.

We dont need Global Warming as the most compelling reason to move away from an oil based economy. How soon we can start moving towards nuclear energy and the rate at which we can scale it will have a big say in our quest to keep growth at high levels.

 

[The Messiah]

Price of oil increases and nearly all commodities get expensive because of higher transportation costs which ultimately falls on the consumer. Why cant the govt use something else to transport say food ? I think if majority of our vegetables were transported throughout the country on electric trains or trucks that weren't on petrol or diesel then prices wouldn't increase.

 

[trackwhack]

Daily Chart_7th Dec 2011 - Indian IT

A comparison of Indian IT majors TCS and Infosys to Microsoft. Apple could have been another choice, but I excluded Apple because Microsoft has been the dominant IT major in the last Decade.

In 2002, Infosys had total revenues of 500 million USD. Microsoft was 60 times larger and had revenues of close to 25 Billion USD. Ten years later, in 2011, Infy has revenues of close to 6 billion USD and Microsoft is 12 times as large. But will Indian IT ever catch up? If innovation and product engineering continues to get a backseat, maybe never. Every annual report has big dreams being painted by Indian IT about funds for Research and Product Development. However nothing significant has ever contributed to Income. Unless Indian IT moves from a services dominated model to a product dominated model, it may well get chewed up and spat out by other emerging countries which can provide these services with greater cost benefit.

 

[trackwhack]

Daily Chart_8th Dec 2011 - Purchasing Power Parity

PPP is a statistic that could be both simple and extremely complicated to understand depending of how deep one is willing to study it.
The simplest way of looking at PPP is, given a certain ratio of PPP to Nominal rate for a certain country as X, what a single dollar can buy in the United States in terms of goods or services, one could buy X times the same quantity of good/services in that respective country.

However, the value of X is determined by a basket of goods and services, just like we use a basket of goods and services to measure inflation. So the value of X would be different for different goods/services. Some goods and services could be more expensive, while other could be less expensive.

Economists view PPP as also a measure of the extent to which a local economy is integrated with the global economy, or in other words the extent of trade barriers that countries put in place to protect their local economies. If there was no duty on goods traded, then there would be far more price evenness for goods and services, save the cost of moving the goods from producer to consumer.

Today's Chart looks at the Ratio of PPP to Nominal GDP for major economies in the world. A second chart also looks at a comparative trend of this ratio between India and China. I would welcome your thoughts on the interpretations that we could derive from these charts.

 

[trackwhack]

Daily Chart_12th Dec 2011 - Incredible India

Tourism Trends.
Since the launch of the Incredible India campaign, there has been a noticeable upswing in the growth of Tourism in India. Whether the growth can be directly attributed to the marketing campaign or other reasons like globalization will be difficult to answer. Despite the growth India still only receives a 1.5% share of the global tourism pie. Plenty for the Tourism department to ponder over as to how to improve this number. Considering the fact that our nation hosts the longest surviving unbroken culture, has flora and fauna as diverse and charismatic as the African continent, unparalleled biodiversity and geodiversity and a never ending festival calendar, the way India is marketed as a tourism destination leaves a lot to be desired. Here is hoping that the world starts looking at India as a more favorable tourist destination in the years to come.

Note : 2011 numbers are an estimate

 

[Daredevil]

Trackwhack, nice compilation of charts. Can you also include the source of your data based on which you are creating these charts?. It makes the charts more authentic and believable and can also be cited elsewhere. Thanks

 

[trackwhack]

Trackwhack, nice compilation of charts. Can you also include the source of your data based on which you are creating these charts?. It makes the charts more authentic and believable and can also be cited elsewhere. Thanks

Thanks for the suggestion and kind words. Here are the sources for the charts posted thus far.

Forex Reserves : RBI Reports
Forest Coverage : World Bank Reports
Agricultural Contribution to GDP and Labor Force : World Bank Reports
Crude Oil Data : US Energy Information Administration
India IT : Annual Reports of TCS, Infosys and Microsoft
PPP vs Nominal GDP : World Bank Reports
Tourism Data : Tourism.gov.in

 

[trackwhack]

Daily Chart_13th Dec 2011 - Chinese Oil Investments

Todays Chart shows where China has parked its money when it comes to securing crude oil.

This is why China actively ignored what was happening in Darfur. But now that Sudan has split what happens to Chinese investements?

Then we have the Arab spring - Libya(part of others group on the chart), Syria (which is why China is actively defending Assad), Tuniusia (has already fallen).

Venezula is under constant threat of US backed opposition overthrowing Chavez, what then?

Was the Arab Springs a grand plan to undercut Chinese oil security? Anyone's guess.

Data Source : International Energy Agency Reports

 

[agentperry]

nice work trackwhack. commendable job....

 

[trackwhack]

Daily Chart_14th Dec 2011 - Sensex v Shanghai Composite

While India has been branded as an under performer among the BRICS, the Index stocks of India and China tell a different story. Today's chart compares the Index performance of the Bombay Sensitive Index (Sensex) to the Shanghai Composite Index (SSE Comp). Please not that the scale is different for both charts, the Sensex plotted against the left hand y axis and the SSE Comp plotted against the right hand axis. The line graphs cannot be a direct comparison as the scale is different. However this does not change the fact that the Sensex has far outperformed the SSE composite.

From its peak of about 6092 in October 2007, the SSE Comp has been on terminal decline. At last closing it was at 2249. That is 63% loss of capital since the peak.

The Sensex peaked at 21078 in Jan 2008. Its last closing was 15881. That's 24% off the peak. During this period, the Sensex almost went back to its all time high in November 2010.

Data Source: Yahoo Finance

nice work trackwhack. commendable job....

Thanks AP.

 

[Daredevil]

Data Source: Yahoo Finance

I'm not sure if that is a credible way of plotting data with two different scales.

A better way would be take Jan-07 data as 100% and the calculate all values based on that. I'm not sure if the chart will be same. If so, my apologies.

 

[trackwhack]

I'm not sure if that is a credible way of plotting data with two different scales.

A better way would be take Jan-07 data as 100% and the calculate all values based on that. I'm not sure if the chart will be same. If so, my apologies.

Thanks for the suggestion DD. I tried to do the same but with real values. I manually adjusted the scale to reflect a normalized plot since people would be interested in real values too . But here is a chart plotted per your suggestion. As a % scale. You will see that it looks almost exactly the same. If I had not manually normalized the first chart it would have looked different. Hence your concern was absolutely valid.:thumb: