Indian Economy: News and Discussion

[dineshchaturvedi]

As per data supplied by government to various agencies worldwide to create report on poverty I have on question. Where do we get this data? Do we all not know that hardly anyone minus the IT/Private serive class which reports it's true income none reports its true income. So where does this data comes from. Even the poor people do not report their correct income and there are many people who have BPL cards but are not BPL.

Now does that not mean that actual condition will be better than the reports, since data is on lower side?
Also I just happend to pass by Dharavi this month and the so called slum of Asia had Tata Sky on every home. So much for poor, also even smallest of this slum had a price tag of 15 lacs.

 

[Yusuf]

Slums of Mumbai are plush with ACs, refrigerators, microwave etc. Dharavi the slum is actually a $5billion revenue area i read somewhere. You can come to India and i will show you that people in rag tag clothes make 15-20k a month.

And i have seen China and how the factories work. No wonder they produce the cheapest things in the world.

 

[Daredevil]

India produces only half as much grain as China does, and its meat and seafoods productions are almost negligible compared to China's. With 3 out of 4 indians living on land and a population as big as china's and lower level of ubnanization, you would think India must have some sky-high unemployment, comparable to that you see in Africa. Yet official indian unemployment rate is only 6-8%, lower than in the US, something here doesn't add up, right?

India has an unemployment rate of 10.7% not 6-8% as you stated. The problem is you are unable to get the perspective of gini-index and going on blabbering. US also is very rich than India but it still has a worse gini-index than Idnia. If you get that, then you will get the fact that India can still have better gini-index than China despite being poorer. Gini index is not about poverty it is about how well the wealth is distributed among various economic classes in the society.

 

[tony4562]

Daredevil

why did you edit my post, are you afraid that I bring up unpleasant facts about india? Unfortunately those are all over the internet. There is a chinese saying, covering one's ears while stealing a bell does not help!

 

[Daredevil]

As per data supplied by government to various agencies worldwide to create report on poverty I have on question. Where do we get this data? Do we all not know that hardly anyone minus the IT/Private serive class which reports it's true income none reports its true income. So where does this data comes from. Even the poor people do not report their correct income and there are many people who have BPL cards but are not BPL.

Now does that not mean that actual condition will be better than the reports, since data is on lower side?
Also I just happend to pass by Dharavi this month and the so called slum of Asia had Tata Sky on every home. So much for poor, also even smallest of this slum had a price tag of 15 lacs.

The data that comes out of unorganized economic societies such as India should always be taken with a pinch of salt as they can be off by a large scale. It is a big problem that a number of people don't report or under report their earnings thus skewing the data. The data that is used to calculate poverty, education, fertility rate etc is based on house-hold surveys conducted by the government agencies based on the pre-built models of survey. This is the same data that is supplied to World bank, UN, Asian Development Bank etc etc.

 

[tony4562]

India has an unemployment rate of 10.7% not 6-8% as you stated. The problem is you are unable to get the perspective of gini-index and going on blabbering. US also is very rich than India but it still has a worse gini-index than Idnia. If you get that, then you will get the fact that India can still have better gini-index than China despite being poorer. Gini index is not about poverty it is about how well the wealth is distributed among various economic classes in the society.

I understand what you are saying. But the mere fact that india has almost a monopoly over asia's richest people makes me wonder how reliable india's gini-number really is.

 

[Daredevil]

Daredevil

why did you edit my post, are you afraid that I bring up unpleasant facts about india? Unfortunately those are all over the internet. There is a chinese saying, covering one's ears while stealing a bell does not help!

Your post is edited because of your intention of flaming by bringing in unrelated talk of semi-naked people, open defecating etc etc which has nothing to do with gini-index that is being discussed. So, stay on the topic or you posts will get edited or deleted if you cross the line.

 

[Daredevil]

I understand what you are saying. But the mere fact that india has almost a monopoly over asia's richest people makes me wonder how reliable india's gini-number really is.

That's the problem in your understanding. Few billionaires doesn't represent the wealth of whole economy. India's Gini-number is as reliable as the poverty rates of India. If you believe the poverty rates of India then you should also believe the gini-index because they are all calculate from the same set of data collected.

 

[Illusive]

I dont understand why is India's negatives always brought up when we talk about its achievements and goals. We know there are challenges, we know there are poor people in India, but that should not undermine India's success economically, yes we are behind China in may aspects but their cultural revolution took place earlier than India. Just acknowledge that India is doing good, its still developing, give it some time.

 

[Rage]

India produces only half as much grain as China does, and its meat and seafoods productions are almost negligible compared to China's. With 3 out of 4 indians living on land and a population as big as china's and lower level of ubnanization, you would think India must have some sky-high unemployment, comparable to that you see in Africa. Yet official indian unemployment rate is only 6-8%, lower than in the US, something here doesn't add up, right?

And what is your source for this? Yourself?

Have you ever been to India? Have you ever witnessed the entrepreneurship of the people?

A slum 10 sq. mi. across generates $4.5 billion in annual income. How many 'SEZ's in China that size generate that much?

India's "GINI coefficients" are generated by the World Bank, not the Government of India. As they are generated for China. You'd do well to remember that fact.

India's unemployment rate, as of the latest update, is 10.70%. The reason the unemployment rate is so 'low', although it is definitely much lower than you think, is because 'work' or 'gainful activity' is described as anything that adds value to the national product- and, therefore, includes unpaid work on farms or farm labour without recompense. That is a problem that's being worked on. Even, given that, the unemployment rate is expected to be around 13% in recessionary conditions. People would be starving to death in the millions, like the 60 mln. that did during the Great Leap Famine, but they are not. Everybody that wants gainful employment and seeks it, finds it, because of India's massive, mammoth informal economy.

As to the credibility of those unemployment figures, they are sourced from among others India's national censuses and the NSSO-the National Sample Survey Organization. A cursory browsing of the internet will show you that India conducts the most comprehensive and copious survey in the world.

 

[Rage]

On Vedanta and the Cairn India issue.

 

[zolpidam]

Indian economy grows by 8.8% in Apr-Jun

Indian economy grows by 8.8% in Apr-Jun - India Business - Business - The Times of India

NEW DELHI: Economy grew by an impressive 8.8% during the quarter ended June on the back of robust manufacturing growth.

However, certain sectors like financial services restrained the growth in economy, which had recorded 6 per cent growth rate in April-June 2009-10.

Agriculture and allied activities grew by 2.8 per cent, higher than 1.9 per cent in the year-ago period, but it is nowhere between the target of four per cent pegged by the government in the medium term.

Manufacturing expanded by strong 12.4 per cent in April-June, 2010 against a mere 3.8 per cent growth rate in the same period last year.

Construction too grew by 7.5 per cent compared to 4.6 per cent.

Among services, financial, insurance and real estate services expanded by just 8 per cent, against a growth rate of 11.8 per cent in the year-ago quarter, while community social and personal services growth slowed down to 6.7 per cent, against 7.6 per cent a year ago.

However, trade, hotels and communication services rose by 12.2 per cent, against 5.5 per cent during April-June 2009.

The government expects economy to grow by 8.5 per cent this fiscal. Though the GDP numbers for the April-June quarter are higher than that of 8.6 per cent in the previous quarter, they lag expectations of 8.9-9.4 per cent forecast by various experts.

Read more: Indian economy grows by 8.8% in Apr-Jun - India Business - Business - The Times of India Indian economy grows by 8.8% in Apr-Jun - India Business - Business - The Times of India

 

[gowthamraj7]

^ is overall annual growth cross 9 percent. Which is higher than china's

 

[Rage]

^ is overall annual growth cross 9 percent. Which is higher than china's

The latest figures on China's quarterly growth rate, as of the time of writing this post, have not been released yet. But the benchmark Shanghai index dropped for the first time in the last several days over concerns the economic recovery may be faltering due to smaller than anticipated US personal incomes. The +8.8% growth, therefore, may be higher than China's, but it's still just a quarterly figure.

 

[Armand2REP]

I understand what you are saying. But the mere fact that india has almost a monopoly over asia's richest people makes me wonder how reliable india's gini-number really is.

Like Chinese are one to talk about gini numbers? Your coefficient is far worse than India. Income disparity in that country is insane.

 

[gowthamraj7]

The latest figures on China's quarterly growth rate, as of the time of writing this post, have not been released yet. But the benchmark Shanghai index dropped for the first time in the last several days over concerns the economic recovery may be faltering due to smaller than anticipated US personal incomes. The +8.8% growth, therefore, may be higher than China's, but it's still just a quarterly figure.

ThankS for information. What do you think would be the annual growth of china this year

 

[Rage]

ThankS for information. What do you think would be the annual growth of china this year

Difficult for me to speculate with a high degree of accuracy. Factory growth, from figures in August, was 13.4% higher in July of this year than July of 2009, but this was the fifth consecutive month the annual pace had slowed and the slowest growth in 2010. Inflation was also up 3.3% compared with 2.9% in June. And economic growth was an impressive 10.3%, but expected to slow down further in the next quarter. Gauging from overall trends, I'd throw out a figure of between 8.7% and 9.2%- with a bias for the higher side.

 

[plugwater]

Govt corrects GDP data issued on Tuesday

The government today admitted there were mistakes in the gross domestic product (GDP) data released yesterday and issued a correction to the first quarter demand-side numbers.

Overall economic growth, measured at factor cost, was however retained at 8.8 per cent during the quarter ended June.

"Inadvertently, there have been use of inappropriate deflators in converting 'Quarterly estimates of expenditures of GDP at market prices in Q1 (April-June) of 2010-11 (at current prices)' to 'Quarterly estimates of expenditures of GDP at market prices in Q1 (April-June) of 2010-11 (at 2004-05 prices)," the ministry of statistics and programme implementation said in a late-evening statement, hours after admitting there were discrepancies in the numbers released yesterday afternoon.

Growth revision
Following the changes, GDP growth at market or 2004-05 prices was revised to 10.02 per cent, as against 3.66 per cent estimated earlier (see table).

While calculating GDP at market prices, the government uses 2010-11 data, which it has to deflate to 2004-05 prices, using the inflation parameters. GDP at factor cost or national income by type of income is a measure of national income based on the cost of factors of production, instead of market prices. This allows the impact of any subsidy or indirect taxes to be removed from the final figures. GDP at market prices includes indirect tax and subsidy provided by the government.

In a note, Nomura India economist Sonal Verma said the GDP deflator for market price was assumed at 20.4 per cent, but for factor cost it was 11.8 per cent. Except for the quarter ended June, the two deflators have historically moved in tandem. "In our view, since WPI (wholesale price index-based) and CPI (consumer price index-based) inflation averaged 11 per cent and 13.7 per cent, respectively, the deflator assumed for estimating GDP at factor cost is the more accurate one," she said. For calculating GDP at factor cost, the government uses the WPI data, while it uses CPI for calculating GDP at market price.

A ministry official said the deflators used were because of a combination of factors but did not explain the reasons.

In addition, the export and import numbers were corrected in the statement issued this evening, which officials attributed to tabulation errors.

On account of yesterday's error, there was a five percentage point difference between the GDP numbers at factor cost (8.8 per cent) and at market prices (3.7 per cent).

Economists said the revised data once again shows the momentum in domestic demand had not weakened by as much as the expenditure-based measure of GDP had suggested.

The earlier numbers indicated government subsidy had increased during the quarter, with significant decline in indirect tax collection. However, data from government departments painted a different picture, as indirect tax collections had gone up by 40 per cent during the first quarter and, even after using the deflator, a decline could not be explained. Similarly, with the government trying to prune subsidies, an increase in share of subsidies in the GDP was seen to be unlikely.

One-Off
Government officials, however, maintained that the mistakes did not affect the credibility of data. "CSO (the Central Statistical Organisation) corrects the figure sometimes because they are on the basis of random surveys. Therefore, there are some errors here and there and the revised figures will be given," finance minister Pranab Mukherjee said on the sidelines of a conference in Mumbai.

Govt corrects GDP data issued on Tuesday

 

[nitesh]

India loses $65 bn annually due to poor logistics: Report - The Economic Times

MUMBAI: A whopping $65 billion is lost every year on account of the inefficient supply-chain system in India

Quite a mind boggling figure

 

[anne.jaa31]

But India's growth over the past two decades has not been transferred to the surplus labor from agriculture. Agriculture continues to be a disproportionate source of employment in India, which represents about 18 percent of India's GDP but employs about 60 percent of the workforce in India.