News
Bubbles and Other Troubles: Risks from Ultra Easy Monetary Policy
In May 2013, Ben Bernanke’s hint of ’tapering’ or slowing down the pace of the Federal Reserve’s unconventional monetary policy called Quantitative Easing (QE) caused nothing short of turmoil within emerging market economies (EMEs). Rapid outflow of capital and a concomitant deterioration of current account deficit resulted in sharp depreciation of currencies and an overall worsening of the respective domestic macroeconomies. By September 2013, the Indian rupee and the Brazilian real had fallen by more than 15 percent each. Inequity markets, Indonesia’s Jakarta Composite Index and Turkey’s BIST 100 shed nearly 20 percent each during this period
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Geopolitical Developments and India-China Relations
The world is in a state of continuing flux. The economies of the major powers are still fragile and vulnerabilities exist in those of the bigger emerging powers in the Asia-Pacific like China and India. The balance of power is concurrently undergoing a shift with competing focal points of power surfacing in the East. The fragile nature has been accentuated in the past few years with Beijing’s accelerated push for recognition as the dominant power in the Asia-Pacific. This is resisted by the US, Japan and India and has made South East Asian countries nervous.
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Calibrating India's climate-change response
India and other developing countries have consistently emphasized the notion of equity in the climate-change debate, advocating a "common but differentiated responsibility"—the principle that all states are obligated to address global environmental degradation, but not equally so.
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Beyond net neutrality
Good friends Vinton Serf and Bob Kahn invented the Internet Protocol together. But they are on the opposite sides of the raging global debate on network neutrality. It's a principle that ensures all Internet Service Providers (ISPs) and governments treat data equally. Net neutrality is simple. It also seems absolutely fair and reasonable. But its simplicity is precisely the reason why it is under severe strain from the complex policy challenges of an evolving set of technologies.
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Nuclear race comes to South Asia
Recently, India has successfully test-fired its short-range ballistic missiles Agni I, Prithvi II and Prahar, all capable of carrying small nuclear payloads. Logic dictates that a credible nuclear doctrine of a nation should not just be based on how it envisions the use of these weapons, but rather on how its adversaries may use them. Although New Delhi continues to deny any consideration of non-strategic use of nuclear weapons, development and the subsequent deployment of Tactical Nuclear Weapons by Pakistan is ought to convince the former to think otherwise.
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Modi's development dream & harsh ground realities
With Prime Minister Narendra Modi at the helm, people are expecting miracles on the economic front. Is it realistic to expect him and his team to bring about a turnaround when some of the key economic indicators have been stagnating for so long? He struck the right note at his inaugural speech by asking people to build a developed and inclusive India. But it is difficult to fulfil all the promises in the short term and will require enormous efforts to bring about inclusive growth. It would involve putting policies in place that would encourage investment and manufacturing growth and tame inflation.
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Fix the economy, don't target big business
With the cacophony of the 16th Lok Sabha election behind us, it is time to reflect on the realities of the politico-economic system that constitutes the set of initial conditions for the next government. The economy is sluggish and structurally weak. More than 60 years after Independence, only a small minority can afford a decent living.
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India's growing trade deficit with China: What can be done?
Where politics disappoints, economics gives a hope. The Sino-Indian ties are emblematic of this proposition. Once bitter neighbours, India and China have for years been trying to integrate economic ties to help resolve their territorial dispute, and trade between the two countries has steered bilateral relations for the last decade. The bilateral trade has travelled a long way since the two sides signed the Most-Favoured Nation Agreement in 1984, crossing the $10 billion mark in 2004, and China becoming India's biggest trading partner in 2011.
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EU-India FTA: Can it be revived?
India and the European Union share an extremely important trade relationship. The value of India-EU trade has more than tripled, to €95 billion in 2013 from €28.6 billion in 2003. A free trade agreement (FTA) between the two partners would strengthen these ties and enable both economies to gain further access to each other's markets. However, with negotiations of the Broad-based Trade and Investment Agreement (BTIA) at a standstill, the question of whether FTA discussions will eventually be concluded post-elections is an important one.
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As internet matures, India faces a choice on governance
For many years, the Indian public in particular had very little interest in who controlled the internet and decisions taken at a structural level that shaped its future.
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