MODI 2.0: THE BIG GDP DEBATE - The Daily Guardian
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As far as the GDP drop is concerned, one needs to understand that it’s a global phenomenon and India is not alone. But in our case, we at least had a bright spot with the agriculture sector, growing by a healthy 3.4% in the aforesaid quarter.

Sanju Verma



India’s GDP decline of 23.9% for the June 2020 quarter stirred a hornet’s nest, with questions raised on the need for a stringent lockdown in the first place. Well, the truth of the matter is, without a strict lockdown in March this year, the damage to human capital would have been far higher. Countries which did not enforce a harsh lockdown initially have not only suffered a GDP contraction but also lost precious human lives in bigger numbers. While the media has been harping about India having the second-highest Covid cases globally, what it fails to mention is that India has amongst the lowest deaths per million, at just 56. The comparable numbers per million are 596 for the US, 613 for Brazil, 612 for the UK, and 473 for Russia.

As for the GDP drop, India is not alone. While the US reported a staggering 32.9% annualised crash in GDP growth for the June quarter, the comparable fall was 42.9% for Singapore, a decline of 38.7% for Canada, a 12.1% fall for Eurozone, a 10.1% drop for Germany, a steep contraction of 20.4% for the UK and of course, a massive plunge of 27.8%, in the case of Japan. In India’s case, we at least had a bright spot with the agriculture sector, which accounts for over 50% of the workforce, growing by a healthy 3.4% in the aforesaid quarter.

Another fact that deserves attention is the GDP data pertaining to March 2020 quarter. Much before the global pandemic struck, while India’s GDP grew at only 3.1%, what has to be acknowledged is that we were the only big economy to report positive growth in the March quarter, with agriculture growing by a credible 5.9%. Other economies like the US, for example, had contracted by 4.8%, Germany by 2.2%, Eurozone by 3.8%, and China actually saw a steep GDP fall of 6.8% in the March quarter. Goldman Sachs has predicted a sharp 27.1% rise in India’s GDP in the June quarter next year, with overall estimated GDP growth of a noteworthy 15.7% for FY22, while Fitch says that India’s GDP growth in 2021-22 will be a good 11%.

Another fact that deserves attention is the GDP data pertaining to March 2020 quarter. Much before the global pandemic struck, while India’s GDP grew at only 3.1%, what has to be acknowledged is that we were the only big economy to report positive growth in the March quarter, with agriculture growing by a credible 5.9%. Other economies like the US, for example, had contracted by 4.8%, Germany by 2.2%, Eurozone by 3.8%, and China actually saw a steep GDP fall of 6.8% in the March quarter. Goldman Sachs has predicted a sharp 27.1% rise in India’s GDP in the June quarter next year, with overall estimated GDP growth of a noteworthy 15.7% for FY22, while Fitch says that India’s GDP growth in 2021-22 will be a good 11%.

Is the worst over? The answer is a decisive “yes”. Take the GST revenues for August, for instance, which stood at Rs 86,449 crore. Despite the lockdown, this was 88% of the GST collected in the same month, last year. Overall, 48.3 million e-way bills were generated in July, almost back to pre-Covid levels of 55.3 million bills, in January 2020. Again, the Indian Railways’ freight loading for August 2020, at 94.33 million tonnes, was 3.31 million tonnes higher compared to August 2019. The Manufacturing Purchasing Managers’ Index (PMI) stood at 52 in August, up from 46 in July. PMI had fallen to a historic low of 27.4 in April but has been steadily climbing since. A sizeable Rs 1.63 lakh crore have also been sanctioned to over 42 lakh MSME units under the emergency credit line guarantee scheme (ECLGS).

More importantly, Modi naysayers and embarrassingly ill-informed writers like Chetan Bhagat, who raised doubts on India’s ability to attract FDI, should not forget that $20 billion are what India attracted as investments and pledges from 15 companies in just three months from April to July 2020 during the Covid-19 pandemic. This $20 billion is a massive vote of confidence for Modinomics. The Taiwanese company Pegatron is the fourth Apple supplier to decide to set up a base in India, after Foxconn, Wistron and Compal Electronics pledged billions in India’s journey towards becoming a global electronics hub.

News has it that Australia is facing its worst recession in 30 years, China’s food shops are running out of supplies and the US might end the year with a 4.2% drop in consumption spending. In sharp contrast, India is doing a far better job in dealing with the Wuhan virus, best amplified by the fact that we constructed 3,181 km of national highways between April and August this year, versus a target of 2,771 km.

At his recent US-India Strategic Partnership Forum (USISPF) address, Prime Minister Modi said, “We are future-proofing India in every way, enabling New India to take off.” Well, PM Modi’s words have found resonance. For example, India’s Hero Motocorp, the world’s largest 2-wheeler company, that derives over 65% sales from rural areas, reported a healthy 7.6% YoY growth in overall sales, selling 5.8 lakh units in August 2020. Ditto for M&M, that derives over 50% sales from rural India. It saw a robust 28% YoY rise in overall tractor sales in July 2020. Maruti Suzuki saw a 21.3% growth in car sales in August, while Tata Motors saw a splendid 154% growth in auto sales. Indeed, since auto sales are a lead indicator, India’s September quarter GDP should see a sharp bounce back.

f $542 billion, the Modi government’s potential move to offer production linked incentives (PLIs) to automobile manufacturers, solar panel makers, speciality steel and consumer appliance companies is a vindication of the fact that, despite Covid and associated challenges, India under Prime Minister Narendra Modi has got its act together, decisively and with no room for any “ifs” or “buts” whatsoever.

The writer is an economist, chief spokesperson for BJP Mumbai, and the bestselling author of ‘Truth & Dare: The Modi Dynamic’.

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Three days before the US-Russia summit, Russian President Vladimir Putin on Sunday said that the two countries need to engage in a constructive dialogue and establish mechanisms for interaction as there are areas in which Moscow and Washington can cooperate.

“[We need] to restore our personal contacts, relations, establish a direct dialogue, create really functioning mechanisms of interaction,” Putin said in an interview broadcast by the media outlet. The President noted that the US side is well aware that there are a number of areas that are of mutual interest, such as strategic stability, regional conflicts, environmental protection measures, and climate. “There are areas in which we can really work effectively,” Putin added.

In the process, President Putin said that Russia would be ready to hand over cyber criminals to the United States if Washington did the same for Moscow and the two powers reached an agreement to that effect.

The Russian leader said he expected the Geneva meeting to help establish bilateral dialogue and revive personal contacts, adding that important issues for the two men included strategic stability, Libya and Syria, and the environment.

Putin also praised Biden for having shown “professionalism” when the United States and Russia agreed this year to extend the New START nuclear arms control treaty.

The White House has said Biden will bring up ransomware attacks emanating from Russia at the meeting. That issue is in the spotlight after a cyberattack disrupted the North American and Australian operations of meatpacker JBS USA.

A Russia-linked hacking group was behind that attack, a US source familiar with the matter said last week.

Asked if Russia would be prepared to find and prosecute cyber criminals, Putin said Russia’s behaviour here would depend on formal agreements being reached by Moscow and Washington.

Both sides would have to commit to the same obligations, he said.

“If we agree to extradite criminals, then of course Russia will do that, we will do that, but only if the other side, in this case the United States, agrees to the same and will extradite the criminals in question to the Russian Federation,” he said.

“The question of cyber security is one of the most important at the moment because turning all kinds of systems off can lead to really difficult consequences,” he said.

With agency inputs

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12 killed, 138 injured in gas explosion in China



HUBEI: At least 12 people were killed and 138 were injured in a huge gas explosion in central China on Sunday, state media reported.

A gas pipe exploded in the Zhangwan district of Shiyan city, in Hubei province at about 6:30 am local time. The number of casualties is still being verified as the search and rescue operation is underway. According to the local authorities, 150 people have been pulled from the debris, and the injured are being treated at local hospitals.

Apparently, the explosion destroyed a wet market there and greatly affected nearby residents. “Hearing the loud bang, I immediately scrabbled beneath the table, thinking it was an earthquake,” a resident surnamed Liu, told the Global Times via phone.

Images are circulating on social media, which appeared to be from the scene, showed rescue workers in orange jumpsuits working through the wreckage of flattened houses.

The cause of the accident is under investigation, according to the city government, which informed on the Chinese microblogging platform Weibo.

Rescue operation is underway and more details are awaited. ANI

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Amid the raging Covid-19 pandemic, Saudi Arabia has once again barred foreigners to perform the Hajj, and set a limit of maximum of 60,000 pilgrims inside the Kingdom.

“Only 60,000 vaccinated residents and citizens living in the Kingdom will be allowed to perform this year’s Haj pilgrimage due to the ongoing coronavirus pandemic,” the Ministry of Haj and Umrah announced in a statement cited by Gulf News on Saturday. The Hajj is one of Islam’s five pillars. Every able-bodied Muslim who has affordability tries to visit it at least once in a lifetime.

“Against the backdrop of what the world is witnessing and due to the continuous developments of the coronavirus pandemic as well as the emergence of new mutations, Haj registration will be limited to residents and citizens from inside the Kingdom only,” the ministry also Twitted.

“Muslims between the ages of 18-65 and are fully vaccinated, or those who received their first dose at least 14 days prior, those who are vaccinated and have recovered from a Covid-19 infection are allowed to register,” the ministry added.

This is the second year in a row that Saudi Arabia limits the Haj pilgrimage to Muslims inside the Kingdom. However, only 10,000 Muslims were allowed to perform Hajj last year.

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The US and Japan have been deepening their engagement with Taiwan to help guard it against a growing threat from China. The move has out Beijing in tight spot.

J. Michael Cole, writing in The National Interest said that the regime in Beijing, which continues its effort to isolate Taiwan internationally, is now in the difficult position of having to express its discontent over coronavirus response while avoiding overreaction that could create the rationale for even closer relations between Taiwan and other countries. Taiwan has had a fairly positive past month in terms of its engagement with, and support by, regional partners.

Beijing’s setbacks began back in April, with the joint statement between US President Joe Biden and his Japanese counterpart, Prime Minister Yoshihide Suga, which “underscore[d] the importance of peace and stability across the Taiwan Strait and encourage the peaceful resolution of cross-Strait issues.”

Such direct reference to Taiwan by a Japanese prime minister had not been heard for more than half a century, reported The National Interest. This was followed the next month by a similar statement, this one by President Biden and South Korean President Moon Jae-in, which again “emphasise[d] the importance of preserving peace and stability in the Taiwan Strait”.

The unprecedented reference to Taiwan by a South Korean leader also signalled those countries within the region were becoming increasingly alarmed with China’s destabilising behaviour—particularly the high number of intrusions by aircraft from the People’s Liberation Army Air Force and Navy into Taiwan’s southern Air Defense Identification Zone (ADIZ), wrote Cole.

Four days before the Biden-Suga joint statement, a total of twenty-five PLA aircraft–14 J-16 multi-role fighters, four J-10 multi-role fighters, four H-6K bombers, 2 Y-8 anti-submarine planes, and one KJ-500 airborne early warning and control plane–entered Taiwan’s ADIZ, a new high since the PLA began intensifying its military activity in the region in 2020, reported The National Interest.

But now, China is in a tight spot as Taiwan is receiving more attention from allies. One strategic mistake Beijing may have committed earlier this year was its refusal to reduce its military activity around the Taiwan Strait during the transition period in Washington, wrote Cole.

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WHO chief asks China to cooperate with probe into Covid-19 origins



Tedros Adhanom Ghebreyesus.

World Health Organization (WHO) chief Tedros Ghebreyesus has called on China to cooperate with the ongoing investigation into the origins of the Covid-19 amid renewed call to further probe the virus.

Dr Tedros made these remarks after taking part in the Group of Seven (G7) summit by video conference on Saturday, The Wall Street Journal (WSJ) reported.

The WHO Director-General hoped there would be better cooperation and transparency when the next phase of the probe into the virus’s origin is underway. “As you know we will need cooperation from the Chinese side,” he said. “We need transparency to understand or know or find the origin of this virus…after the report was released there were difficulties in the data sharing, especially in the raw data.”

He further said that the preparations for the probe’s next steps were underway and that the issue of the origin of the virus was discussed by G7 leaders on Saturday, WSJ reported.

Earlier this week, the US and the UK had extended support to a “timely, transparent and evidence-based independent process” for the next phase of the WHO-convened study of Covid-19 origins. “We will also support a timely, transparent and evidence-based independent process for the next phase of the WHO-convened COVID-19 origins study, including in China, and for investigating outbreaks of unknown origin in the future,” a joint statement said after US President Joe Biden met British Prime Minister Boris Johnson on Thursday.

This comes amid growing calls for a timely, transparent, and evidence-based independent process for the next phase of the WHO-convened origin study.

Recently, the calls to investigate further the origins of the virus have intensified. President Biden has also ordered a fresh US intelligence inquiry into the origins of the pandemic.

The origin of novel coronavirus that caused havoc around the world has remained a mystery even after 1.5 years the first case of infection was reported in the Chinese city of Wuhan.

Now, scientists and world leaders are calling for further investigations to figure out whether the virus originated naturally or leaked from the Wuhan Institute of Virology.

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In a veiled criticism of the Dragon, Group of Seven (G&) leaders called on China to respect human rights in its Xinjiang region, allow Hong Kong a high degree of autonomy, and refrain from any unilateral action that could destabilise the East and South China Seas, Reuters reported quoted a draft version of the G7 summit communique.

“We will promote our values, including by calling on China to respect human rights and fundamental freedoms, especially in relation to Xinjiang and those rights, freedoms and high degree of autonomy for Hong Kong enshrined in the Sino-British Joint Declaration,” the G7 said in a communique that was almost finalised.

Before the G7 criticism emerged, China cautioned G7 leaders that the days when “small” groups of countries decided the fate of the world were long gone.

The G7 also said they underscored “the importance of peace and stability across the Taiwan Strait, and encourage the peaceful resolution of cross-Strait issues”.

“We remain seriously concerned about the situation in the East and South China Seas and strongly oppose any unilateral attempts to change the status quo and increase tensions.”

“We also call for a timely, transparent, expert-led, and science-based WHO-convened Phase 2 Covid-19 origins study including, as recommended by the experts’ report, in China,” the communique, which is almost finalised, said.

“The days when global decisions were dictated by a small group of countries are long gone,” a spokesman for the Chinese embassy in London said.

“We always believe that countries, big or small, strong or weak, poor or rich, are equals, and that world affairs should be handled through consultation by all countries.”

Beijing has repeatedly hit back against what it perceives as attempts by Western powers to contain China, and says many major powers are still gripped by an outdated imperial mindset after years of humiliating China.

UN experts and rights groups estimate over a million people, mainly Uyghurs and other Muslim minorities, have been detained in recent years in a vast system of camps in Xinjiang.

China denies all accusations of forced labour or abuse. It initially denied the camps existed, but has since said they are vocational centres and are designed to combat extremism. In late 2019, China said all people in the camps had “graduated”.

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