Indian Economy: News and Discussion

[IndianHawk]

Not really, Japan and to an extent Taiwan and SoKo have shown that indeed it's possible to practice "scientific agriculture" on small holdings and ensure high productivity.

However, the situations are very different because
1. Agriculture in those countries is not really a means for sustenance.
2. Inputs and farm produce procurement are heavily subsidised.
3. They are not water-stressed.

But the yields per acre are very high, something we can try and learn and adapt to our situation.

That's what I wrote. Our marginal farmers can't afford fertilizers or high quality seeds or other costly methods.

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[IndianHawk]

On average Indian percapita land holding is roughly 3 acres how can one farmer manage heavy machinery? different farmers sow different varieties and in different times so even tractor also not used in 90% farms and here u are dreaming heavy machinery.



Our urbanization is nearly 33% aka only 1/3 lives in cities Vs 55% China.Actually world average is also ~55%.India's urbanization is very low.

Farmers with Decent land holdings are already going for mechanisation as it is less costly and more effective than using more labours. There is no substitute to efficiency other than loosing out to your competition on cost and profit.

Indian urbanisation figure are highly disputed.
Other nations use much lax measure.
Many countries call any area with 5000+ residents as urban and hence show greater urbanisation . We have multiple criteria to declare a area urban and hence huge census town ( 50K- 100k population) are still defined as rural. Their are so called villages in heart of Delhi for god's sake.

https://www.livemint.com/Politics/4UjtdRPRikhpo8vAE0V4hK/How-much-of-India-is-actually-urban.html

Satellite data shows atleast twice the urbanisation as against official figures .

5000+ habitants definition gives 47% urbanisation.

Read more.

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[IndianHawk]

Landless farmers are not farmers, they are freelance laborers. They work in farms during sowing and harvesting season, and other times they work odd jobs. They will get absorbed in the manufacturing sector soon.

The farmers who have land are not doing it efficiently. They would rather dump their produce to create artificial scarcity to force the middle class to pay more, than actually investing in value addition and commanding better prices. They have a problem when they under produce, and they have a problem when they overproduce. Their actions are not in co-ordination with the gormint but they want others to bail out their bad loans and pay higher price for their produce.

When they produce more, they do this..

They could have easily set up a co-operative trust and applied for the tools to do value addition. Smart farmers have started taking Laghu Udyog loans to convert their produce into jams and pickles. It doesn't require a big industrial setup to chop up veggies and pour salt and sugar and bottle it up.

If they just aspire to sell their raw material at the rate of gold, the distress will continue. Those who were acting in good faith did take benefit of Modi's initiatives for scientific farming, preservation, packaging and value addition. They even received FSSAI certification and started selling them.

Those who were rigid minded are continuing the 'farmer distress' narrative in the hope that it will become an election issue and get them subsidies.

They are these type of "poor farmers"..

They are doing it out of charbi, nothing else. Eventually they will discover that the gormint will not give in to their tantrums and they will have to quit farming and sell their land to someone who wants to pursue agriculture seriously.

That's what I agree with. We can't afford 60-70 Cr people perpetually working in agriculture which only produces 13-14% of GDP.

This effectively means half of India is very very unproductive from economic point of view.
It's a recipe for disaster and endless poverty.

What you pointed out is small scale industries and they need to be encouraged heavily. But that's still not enough for 69-70cr people.

We need massive industrialization . 10 Cr people need to be in some kind of jobs so that their families ( 5 each so total 50cr) can come out of poverty to lower middle class .

And to my point about urbanisation . People here are thinking that rural masses will move into existing cities but that's only part of migration.
Majority of urbanisation is growth of erstwhile rural areas into new cities and expansion of existing cities by miles and miles.

This process is taking place at a very rapid pace .



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[Indx TechStyle]

Our urbanization is nearly 33% aka only 1/3 lives in cities Vs 55% China.Actually world average is also ~55%.India's urbanization is very low.

India & China don't even have same definition of urbanization. India will cross 50% itself by Chinese definition.
So, better not compare.

 

[Haldiram]

What you pointed out is small scale industries and they need to be encouraged heavily. But that's still not enough for 69-70cr people.

We need massive industrialization . 10 Cr people need to be in some kind of jobs so that their families ( 5 each so total 50cr) can come out of poverty to lower middle class .

Yes and yes to both. Let agriculture be done by a small number of dedicated people with high efficiency. Let the bulk of the laborers move towards manufacturing jobs << this will take some years to be created but we are marching in that direction.

Right now, the people who are doing agriculture inefficiently are like the proverbial snake sitting on top of a pot of gold. They are neither using it nor letting others use it. There are businesses like Godrej Agro, Tata, Reliance Fresh which have the capital to buy land from farmers and start producing there. It will help them secure the entire supply chain from growing the crop to selling it in their own supermarket, no middleman involved. Transportation, cold storage, marketing all taken care of by themselves. Let Reliance grow its own crops and sell it in Reliance Fresh stores. There's no scope for anyone to complain about MSP, or rainfall, or middlemen. Once a corporate takes over an enterprise, the profit and loss is their problem. They will pay money to set up irrigation and manage everything properly and charge the end customer for it. Reliance already has a hydroelectric power plant. It will cost them peanuts to channelize the water from there to their farms.

 

[Haldiram]

On average Indian percapita land holding is roughly 3 acres how can one farmer manage heavy machinery? different farmers sow different varieties and in different times so even tractor also not used in 90% farms and here u are dreaming heavy machinery.

There's no point in farmers complaining about gormint's lack of investment in irrigation. The gormint is only as rich as the tax that the middle class pays. The middle class isn't exactly getting a food subsidy in exchange for the tax we pay in the name of irrigation and rural development. On the contrary, food inflation goes up by 10% every year. We have an obligation towards them but they have no obligation towards anyone? they are dumping their surplus produce so that it becomes costly for us. How generous of them. I'd prefer paying to Reliance Fresh directly and let them use that money to manage their farm expenses. The middle class has been paying for rural subsidies for decades by putting their own aspirations on hold. Middle class aspires that their tax money be spent on flyovers, metros, bullet trains, fiber net. Instead, every year our farmer bhratas seek loan waivers and subsidies.

They aren't able to turn a profit out of their land, they are just holding on to it and inuring losses for themselves and the tax payers out of their sentimental attachment to the land. Do it properly otherwise if you can't manage it then sell it and move aside. Don't shortchange the exchequer for bailouts << That's what we say to any other business which asks for a bailout, be it banks, or airlines or textiles or Kingfisher. Ultimately the textile mills had to be closed down due to their inefficiency and unionbaazi. Does that mean we don't have clothes now? production will always move from the less efficient to the more efficient. Textile workers also tried to build pressure on gormint, committed suicides, tried everything, but the gormint didn't come under pressure.

 

[Haldiram]

Donald Trump terminates India's preferential trade status under GSP programme

I have determined that India has not assured the US that it will provide equitable and reasonable access to its markets. Accordingly, it is appropriate to terminate India's designation as a beneficiary developing country effective June 5, 2019

One day they add us to currency manipulator's watchlist, next week they remove us. One day they threaten us with sanctions for buying Iran oil, next week they give us a waiver.

This is India playing its cards right in the covert trade war imposed on us and keeping Murica on their toes. They were waiting for the new gormint to be established, probably hoping that Modi would win less seats and then the US could put pressure on him through coalition partners; But he won full majority and gave them the finger on the first day of work.

 

[S.A.T.A]

Indian agro sector is currently a bottom less pit, no matter how much money the govt invests, in terms of loan waiver, low interest loans, MSP, it's bound to lose money. I tend to concur with @Haldiram that Its unfair to expect the tax paying middle class to shore up the poor investment decisions of the farmers.

I know a couple of guys at office, part of the maintenance staff, who had small farms in their native place(probably Maharashtra). Both go on leave, just before the sowing and harvesting season to help out. When asked how this works out, they say because sowing is labor intensive, they have to be there, and the wives and other women folk will be able to take care of the crop until harvest time. These women who are mostly illiterate and homebound, are expected to take care of buying fertilizers, manage water supply during crop growth period and general crop maintenance. Even these guys agree that the women folks don't make informed judgment on buying fertilizers or their use in the field, don't negotiate well with the local authorities on getting adequate water for their fields, etc. The net result is poor yeild or a general crop failure. When probed as to why they can't sell the land and permanently move to the city, they say have crop loans. How do they plan to pay back the loan, they will say they are expecting loan waiver and what after that, they will say take fresh loans for the next season..

I seriously take cause with those who want me to subsidize such unscientific and uneducated bunch of people. No matter how many repeated loan waivers are offered and no matter how much subsidies are doled out, people who are not educated enough to understand their line of business(our modern kisan) will not be able to make it profitable or sustainable. To quote Einstein " insanity is doing the same thing over and over and expecting a different result."

 

[Bhadra]

Good time to accumulate midcaps. They're trading near their intrinsic values for the first time since 2011. It's a textbook case of 'fear' cycle which investing books talk about. Very low downside and high upside potential. Those who got scared left the market altogether. Those who wanted to stay, migrated their money to largecaps. The midcap space is like a deserted playground now.

I had accumulate DHFL and MothersonSumi thinking that their future was bright ...
But both are sunk .....

 

[Shashank Nayak]

Trump has withdrawn GSP status for India.. I do feel that this hurried decision, is in response to India letting US know that it would resume oil imports from Iran...

 

[mayfair]

Trump has withdrawn GSP status for India.. I do feel that this hurried decision, is in response to India letting US know that it would resume oil imports from Iran...

That's Trump being Trump, he's slapping tariffs left, right and centre on ALL US trading partners as a part of his rhetoric and preparation for 2020 Presidential campaign.

 

[S.A.T.A]

Trump has withdrawn GSP status for India.. I do feel that this hurried decision, is in response to India letting US know that it would resume oil imports from Iran...

This was to be expected. The US administration has been asking India to climb down on its tough stand on intellectual property rights, esp in the pharmaceutical sector, particularly in regards to the generic drugs. Such a move would have negatively impacted our pharma sector. Trump only hastened a move long time in coming.

 

[Haldiram]

I had accumulate DHFL and MothersonSumi thinking that their future was bright ...
But both are sunk .....

I've replied in the Chit Chat thread : https://defenceforumindia.com/forum/threads/chit-chat-thread.4046/page-1591#post-1537021

 

[Willy3]

So did labour ministry accept that earlier NSSO draft report on unemployment is true? If our unemployment rate without NAREGA jobs is as high as 6.1% then it's a very tragic state of affair

 

[Sehwag123]

So did labour ministry accept that earlier NSSO draft report on unemployment is true? If our unemployment rate without NAREGA jobs is as high as 6.1% then it's a very tragic state of affair

Methodology has been changed this time. Can't compare with previous data.

 

[DG7867]

https://www.moneycontrol.com/news/b...-pace-in-three-months-in-may-pmi-4057471.html
India factory activity grows at fastest pace in three months in May: PMI
The survey found increased optimism about manufacturing activity over the coming year, probably helped as Prime Minister Narendra Modi scored a dramatic election victory on a mandate of business-friendly policies and a tough stand on national security.

Reuters@moneycontrolcom

India's manufacturing sector expanded at its quickest pace in three months in May on improved output and new orders, according to a private business survey which also showed a pick up in hiring.

The survey found increased optimism about manufacturing activity over the coming year, probably helped as Prime Minister Narendra Modi scored a dramatic election victory on a mandate of business-friendly policies and a tough stand on national security.

Almost 70% of responses were collected after exit polls showed Modi's Bharatiya Janata Party would return to power for a second term.

AN-32 aircraft with 13 on board goes missing, search operations underway: Indian Air Force[/paste:font]

• Bombay HC upholds death penalty clause for repeat rape offenders introduced after Nirbhaya case

• Rajya Sabha session from June 20 to July 26

"A revival in new order growth promoted a faster upturn in manufacturing production, as Indian firms sought to replenish inventories utilised in May to fulfill strengthening demand," Pollyanna De Lima, principal economist at IHS Markit, said in a release.

The new business orders sub-index, which tracks overall demand, rose as foreign demand increased at the fastest pace in three months. Output also grew at the strongest rate since February.

That led firms to increase the pace of hiring from the previous month when headcount was barely changed.

"To assist with higher output needs, and benefit from relatively muted cost inflation, companies stepped up hiring and input purchasing," De Lima said.

"Goods producers were also able to charge competitive prices due to negligible increases in their cost burdens, meaning not only higher sales in the domestic market, but also greater overseas demand."

Although input costs increased at a stronger pace in May, manufacturers did not pass on those pressures to customers and instead trimmed prices for the first time since December. The output prices sub index dropped to 49.9 from 50.8.

That will help keep retail inflation muted and well below the Reserve Bank of India's 4% target, increasing the likelihood of an interest rate cut at the next policy review on June 6.

If the central bank cuts rates this week, as expected, it would mark the third consecutive easing in as many meetings

we're back in business..

 

[Haldiram]

RBI likely to cut repo rate by 25bps on weak growth, soft inflation

Seven of the 10 economists and bankers polled expect the RBI to cut the repo rate by 25bps, one expects a rate cut of more than 25bps and the rest say RBI will pause this time.

Going by the way bonds have crashed in just 2 days, me has a feeling there might actually be a rate increase, instead of a rate cut. (or, maybe, an increase in inflation rate).

 

[ezsasa]

Love the new policy on satellite dish channel pricing.... spent some time on it and was able to cut monthly charges by 2/3rd....

 

[Haldiram]

₹2.22 tn as markets record biggest single-day fall this year

• 
  
  
  • The market capitalisation (m-cap) of BSE-listed companies tumbled₹2,22,304.65 crore to ₹1,53,19,126.66 crore

Me been warning. Gib Bharat Ratna

 

[nongaddarliberal]

₹2.22 tn as markets record biggest single-day fall this year


Me been warning. Gib Bharat Ratna

Why is this happening though?

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