Skip to main content

Morgan Stanley: Nonsense and ridiculous to say India's GDP grew at 7.5 per cent

By Our Representative
Following Reuters Breakingviews Index, which said early this month said that India's gross domestic product (GDP) did not grow by 7.5 per cent in the first quarter of this year, as claimed by the Modi government but just around 5 per cent (click HERE to read), world's leading consultants Morgan Stanley has created a flutter by declaring that India could not have growth "anymore than 6 per cent."
Ruchir Sharma, head of Emerging Markets and Global Macro at Morgan Stanley Investment Management, in a recent interview with CNBC-TV18 in New York, has said that the Government of India's "revised GDP numbers", that have shown India as the world's fastest growing economy, are nothing but a "nonsense. He insists, "This [the GDP growth number] is the most ridiculous thing I've seen from any country in the recent past. It is hurting our credibility" he says.
Saying that some "incremental change" has taken place towards reforming India's economy, Sharma, however, regrets, they are "not the kind of big bang reform that some people were expecting." He adds, "If you do not get that big bang reform in the first year it is very difficult to do that in the second year or in the third year. because the opposition tends to regroup."
Pointing out that "the political capital is beginning to decay", Sharma says, the Government of India's projections of the Indian economy growing by 8.5 per cent or 9 per cent or 10 per cent are "completely off the mark", adding, "To claim that the Indian economy is growing at 7.5 percent with exports slumping -- which was the big contributor to growth last decade -- is absolutely ridiculous."
Looking at the international scenario, Sharma suggests, this is even more off the mark. He says, "At a time when the global economy is growing at pace of little more than 2 percent and the growth rate in emerging markets has halved from a rate of 8 percent at the peak last decade to less than 4 percent just now. Ex-China it is just 2.5 percent..."
Sharma wonders, "Where are the signs of this domestic boom? There is something called as measured economy and something called as experienced economy. Who is experiencing the 7.5 percent economic growth in India, I want to know, who these people are?"
Suggesting that India's economy grew at a faster rate than that of China is "the single biggest pitfall of this government", Sharma underlines, "Comparing India and China is cool because these are two large economies based in Asia but there is nothing in common between them even in terms of size." He adds, "India today is where China was about 20 years ago."
"We are also in an environment where the overall environment for emerging markets is not that conducive", Sharma says, adding, "The overall flows to emerging markets haven't been that strong and this is not what the case was last decade."
Wanting the Government of India to begin reforming with public sector banks, Sharma says, "You cannot have a system where 70 percent of the assets are controlled by public sector banks and those public sector banks have such non-performing loans which are not properly recognised for a long period of time, that is just a lot of wrought in the system."
Pointing out that India faced "the biggest missed opportunities in the first year", Sharma wants the public sector to continue to play the key role in infrastructure: "The private sector is not good at infrastructure. If you look historically it is really the public sector which plays a dominant role in infrastructure. China spends 10 percent of its GDP on infrastructure but the reason why it is able to do that is because it doesn't spend that much on subsidies."

Comments

TRENDING

'Very low rung in quality ladder': Critique of ICMR study on 'sudden deaths' post-2021

By Bhaskaran Raman*  Since about mid-2021, a new phenomenon of extreme concern has been observed throughout the world, including India : unexplained sudden deaths of seemingly healthy and active people, especially youngsters. In the recently concluded Navratri garba celebrations, an unprecedented number of young persons succumbed to heart attack deaths. After a long delay, ICMR (Indian Council for Medical Research) has finally has published a case-control study on sudden deaths among Indians of age 18-45.

SC 'appears to foster' culture of secrecy, does not seek electoral bond details from SBI

By Rosamma Thomas*  In its order of November 2, 2023 on the case of Association for Democratic Reforms vs Union of India contesting constitutional validity of electoral bonds, the Supreme Court directed all political parties to give particulars of the bonds received by them in sealed covers to the Election Commission of India. SC sought that information be updated until September 2023. 

How national chauvinism 'overtook' sport despite cricketing glory of World Cup 2023

By Harsh Thakor*  The recently-concluded cricket World Cup was a testimony or manifestation of the thrills, intensity, twists and turns in sport and evolution of the game of cricket. It carried on the trend of the World Cups of yesteryears. Possibly, this was the best ever Indian team in a World Cup, and arguably amongst the best ever to contest a World Cup.

Only 12% of schools RTE compliant: Whither 6% budgetary allocation for education?

By Ambarish Rai* Despite Indian state’s commitment of 6% GDP on education, the Finance Minister completely ignored right to education for children and strengthening implementation of RTE Act which makes education a fundamental right in her budget speech . The Right to Education (RTE) Forum, which is a collective of different stakeholders in education, condemns this neglect of a legal entitlement, which is unconstitutional and demand for overall increase in the budget to ensure improvement in learning outcomes and overall enhancement of quality education.

A Hindu alternative to Valentine's Day? 'Shiv-Parvati was first love marriage in Universe'

By Rajiv Shah*   The other day, I was searching on Google a quote on Maha Shivratri which I wanted to send to someone, a confirmed Shiv Bhakt, quite close to me -- with an underlying message to act positively instead of being negative. On top of the search, I chanced upon an article in, imagine!, a Nashik Corporation site which offered me something very unusual. 

Swami Vivekananda's views on caste and sexuality were 'painfully' regressive

By Bhaskar Sur* Swami Vivekananda now belongs more to the modern Hindu mythology than reality. It makes a daunting job to discover the real human being who knew unemployment, humiliation of losing a teaching job for 'incompetence', longed in vain for the bliss of a happy conjugal life only to suffer the consequent frustration.

Buddhist shrines were 'massively destroyed' by Brahmanical rulers: Historian DN Jha

Nalanda mahavihara By Our Representative Prominent historian DN Jha, an expert in India's ancient and medieval past, in his new book , "Against the Grain: Notes on Identity, Intolerance and History", in a sharp critique of "Hindutva ideologues", who look at the ancient period of Indian history as "a golden age marked by social harmony, devoid of any religious violence", has said, "Demolition and desecration of rival religious establishments, and the appropriation of their idols, was not uncommon in India before the advent of Islam".

'Ambiguous policy': India late in advocating EVs as energy storage in national grid

By Shankar Sharma*  This is regarding the points raised by the Chief Electricity Authority’s (CEA's) advocacy for usage of electrical vehicles (EVs) as energy storage technology, and few associated issues . An objective reading of what he states should reiterate the enormously growing importance of battery energy storage systems (BESS) in our need to transition to a net-zero carbon scenario for the country.

Savarkar in Ahmedabad 'declared' two-nation theory in 1937, Jinnah followed 3 years later

By Our Representative One of the top freedom fighters whom BJP and Prime Minister Narendra Modi revere the most, Vinayak Damodar Savarkar, was also a great supporter of the two nation theory for India, one for Hindus another for Muslims, claims a new expose on the man who is also known to be the original proponent of the concept of Hindutva.

Is India emulating west, 'using' anti-terror plank to justify state-supported violence?

Fahad Ahmad, Baljit Nagra*  Prime Minister Justin Trudeau has accused India of being involved in the assassination of Hardeep Singh Nijjar, a Canadian Sikh leader, on Canadian soil. Narendra Modi’s right-wing Hindu nationalist Indian government is defiant and denies involvement. Indian officials have instead admonished Canada for being a “ safe haven ” for Sikh “terrorism,” a pejorative for Sikh self-determination .