Policy Watch

Ayushman Bharat
01 October, 2018, Prabhat Patnaik
The Modi government's claim of ushering in the largest healthcare scheme in the world is completely vacuous. The chosen method of enlarging healthcare access to the poor is wrong both because of the route chosen (the insurance route which benefits insurance companies more than it benefits the patients) as well as because of the ridiculously paltry financial provision.
RCEP Deal can be Disastrous for India
13 September, 2018, Biswajit Dhar
Our FTA experience and existing trade imbalance with RCEP nations inform us that such a trade pact will hurt our producers.
India's Electronics Manufacturing Sector: Getting the Diagnosis Right
07 September, 2018, Smitha Francis
The Indian electronics industry’s high dependence on imports is a direct outcome of the trade and investment liberalisation that was carried out by successive governments without putting in place the necessary industrial policy support for maintaining and improving domestic linkages and indigenous capabilities.
National IPR Policy and Innovation
18 July, 2016, Reji K. Joseph
This article seeks to analyse critically the relationship between innovation and IPRs with a view to understand the implications of the IPR Policy for India.
Revised Version of India's New Model Bilateral Investment Treaty
12 July, 2016, Andrew Cornford
The revised version of India's model bilateral investment treaty has introduced greater flexibility and has included some extensions of rules contained in the initial 2015 draft.
Dispute Settlement in International Investment Agreements and the Rules of an Indian Model Bilateral Investment Treaty
22 September, 2015, Andrew Cornford
This article reviews the Indian model bilateral investment treaty and the major provisions of international investment treaties, often with special attention to their historical development.
From District to Town: The movement of food and food providers alike
08 January, 2013, Rahul Goswami
Policy obsession with urbanisation is changing the nature of crop production and food consumption in India as seen in the shifts in district rural-urban population balances.
FDI in Retail: Benefiting neoliberalism, harming people
26 September, 2012, Subhanil Chowdhury
The decision of the UPA government to open up the retail sector in the country to FDI is an example of the basic fallacy in the ‘growth fetishism’ of the votaries of neo-liberalism. While the government argues that this move will generate investor confidence in the Indian economy and lead the country to high growth, in reality the problems of the common people- deprivation, poverty and hunger- far from being ameliorated will actually be intensified.
Food and Agriculture: Trends in India into the early Twelfth Plan period
23 April, 2012, Rahul Goswami
The transformation taking place in India's agriculture and crop cultivation choices is brought about by a few key factors that have begun to heavily influence the patterns of crop cultivation, the movement of food through India and the effect of these on nutrition on different income classes in rural and urban habitats. In this view, foreign direct investment in multi-brand retail and the influence of the retail food industry is linked with climate change impacts and the proposed genetic engineering solutions; the combining of agriculture, health and nutrition is aided by pro-technology policies and consumption geared for urbanising India; and the domination by the USA of the crop science, research agenda and market reform process is still evident. These factors are responsible for the repetition of the misdiagnosis of impending hunger in the country by the Government of India as being a consequence of a lack of food, to be tackled today, and tackled exclusively by technological means.
National FDI Concepts: Implications for investment negotiations
04 June, 2010, Smitha Francis
Free trade agreements and bilateral investment treaties make privileges for and treatment of foreign direct investors legally binding. Thus, apart from the concerns of being able to capture the ''real'' financial and economic contribution of foreign direct investment inflows, FDI definitions are also about protecting the ''rights'' of the so-defined investors in the host country. Keeping this in mind, the article analyses India's current FDI policy and warns that if we define FDI within our national regulatory framework too broadly to allow instruments and flexibility that were earlier resisted, we would have already lost most of the leverage in investment negotiations at the regional and multilateral levels.
Report on the State of Food Insecurity in Rural India
23 November, 2009,
This Report is an update of the Rural Food Insecurity Atlas of 2001 released by the M S Swaminathan Research Foundation (MSSRF) and the World Food Programme (WFP). Since then, numerous new programmes have been initiated by the central and state governments for achieving food security in the country. Giving a broad indicative picture of the level of food insecurity in different states and the operation of the nutrition safety net programmes, the Report concludes that the State has to play a crucial role in enhancing foodgrain output, ensuring the widest access to food through expansion of livelihood opportunities and promoting biological utilisation through appropriate investments in public health measures.
Equity and Inclusion through Public Expenditure: The potential of the NREGS
29 January, 2009, Jayati Ghosh
In the present situation of global economic crisis and national economic slowdown, ''inclusive'' public expenditure, such as in the NREGS, is not only desirable from a social or welfare perspective - it also provides very direct economic benefits. This is because wage employment schemes like NREGS tend to be self-targeting and thus will lead to a higher multiplier effect, making government expenditure more effective in reviving output and indirect employment.
Budgetary Policy in the Context of Inflation
30 March, 2007, Prabhat Patnaik
Negating the impact of the current inflationary episode in India on the poor requires both the ensuring of appropriate supplies through imports, and a transfer of purchasing power from the profit earners to the workers. Hence, even if augmentation of supplies through resorting to imports, as the government is doing now in the case of foodgrains, succeeds in ending inflation, there is still the need to put additional purchasing power in the hands of the poor so that they regain their earlier real income. The author argues that the basic problem with the 2007-08 budget is that it is oblivious of these social demands of a situation of profit inflation.
Singur and the Political Economy of Structural Change
17 February, 2007, Mritiunjoy Mohanty
The paper explores the controversy that has surrounded the West Bengal Government's land acquisition programme in Singur and situates it within the overall context of economic growth and transformation. It argues one of the most adversely affected groups as a result of the acquisition is relatively large farmers for whom agriculture is a source of accumulation and not livelihood and subsistence. This might explain in part why the resistance has been so strong. The paper argues that equitable and sustained growth is possible only by reducing the share of agriculture in the labour force and therefore that the West Bengal Government's strategy has to focus on maximising the generation of non-farm rural employment.
Resources for Equitable Growth
07 December, 2006, Economic Research Foundation
The declared aims of the Planning Commission's Approach to the XIth Plan, all of which require substantially increased public expenditure in physical infrastructure and social sectors, simply cannot be met within the confines of a restrictive fiscal policy stance. The need to rethink policies of resource generation and financial regulation is therefore urgent. In this context, this paper seeks to examine the effects of the three perceptions underlying the prevailing fiscal conservatism, questions their validity and offers some alternatives for mobilising resources for development.
The Revised Basel Capital Accord: The Logic, Content and Potential Impact for Developing Countries
31 August, 2006, Smitha Francis
Basel II is the modified framework of supervisory regulations governing capital adequacy for internationally active banks, published by the Basel Committee of Banking Supervision. This paper argues that while the Revised Accord is yet another attempt by the global financial community to remedy the woes associated with unhindered financial liberalization, it will only serve to exacerbate the already existing conflicts between the objectives of financial stability and economic development facing developing countries under the present paradigm.
Three Budgets of UPA: Where is the ''Human Face''?
22 March, 2006, Shouvik Chakraborty
In recent years, the media has created a lot of hype about the UPA government's budgets, stating that these are examples of ''reforms with human face''. This government assumed power on May 22, 2004, with the support of the Left parties, and was expected to bring about major changes in the economic policies in favour of the poor.
On Resource Mobilization
10 February, 2006, Left Parties' Note
Successive governments in India have lacked the vision or the political will to recognize that for adopting a broad-based and effective pro-poor programme as well as finance its development, it must shift its fiscal policy in a direction that is geared towards taxing the rich effectively in order to generate more tax revenues and a high tax-GDP ratio. In fact, the trend has been to the contrary: the rich have received several tax concessions.
Independent Commission on Banking and Financial Policy
16 May, 2005,
The change in banking policy currently underway is eroding the role of the banking sector as a means for more rapid and broad-based development. The change also seems to be worsening the difficulties being faced by domestic banks and creating new ones, leading to an increase in fragility. Above all, there is a danger that banking ''reform'' is paving the way for a decline of domestic control over banking operations as a result of international takeovers, with attendant adverse implications for economic sovereignty.
Sub-Federal Governance and Global Harmonisation of Policies: Some Issues for Consideration
19 February, 2005, Murali Kallummal & Smitha Francis
Providing an overview of the trends towards the global harmonisation of economic policies, this paper argues that the challenges faced by developing countries in addressing their local developmental concerns call for sub-federal governance structures and strategic re-engineering of federal finances.
SDRM: Debt Restructuring or Liquidation?
02 January, 2003, C.P. Chandrasekhar, Jayati Ghosh & Smitha Francis
Even as the Bretton Woods Institutions are opposed to reform of the international financial architecture to prevent crises, they are ardently searching for ways to deal with the fallout of crises on sovereign debt. C.P. Chandrasekhar, Jayati Ghosh and Smitha Francis examine the Sovereign Debt Restructuring Mechanism (SDRM) advocated by the IMF, discuss the factors that motivate those advocating it and assess the likely consequences of its implementation.
Food Stocks and Hunger in India
03 August, 2002, Utsa Patnaik
The majority of academics and activists alike seem to be complacently unaware of the depth of the hunger stalking India's tribal areas, villages and urban slums. The complacence arises from the fact that while the crisis over forty years ago was caused by a deficiency of supply which everyone could understand, the problem today is caused by deficiency of demand.
The Strange Behaviour of The Insurance Business in India
27 July, 2002, Jayati Ghosh
The author argues that the performance of the insurance sector after liberalization have so far contradicted the predictions of lower prices and better prices for the consumers. On the contrary, the profit emphasis of the insurance companies, private and public, have made it more difficult and expensive for consumers to take policies where they are most at risk.
Danger Signals for the Indian Economy
11 July, 2002, Jayati Ghosh
The new Finance Minister, Mr. Jaswant Singh, has already declared his intention to try and increase purchasing power, especially of the domestic middle classes. Clearly, the government has designed this particular Cabinet switch of portfolios to restore the government's popularity, and therefore its electoral fortunes, before the next general elections. The aim, presumably, is to undo the damage to the BJP's middle class constituency which was caused by the last Budget presented by Mr. Yashwant Sinha.
Minimum Support Prices and the Food Crisis
04 April, 2002, C.P. Chandrasekhar
The changes in minimum support prices for rabi season crops illustrate the fact that the government is bent on pursuing an infeasible strategy for resolving the ‘food crisis’ it has itself engineered.
Budget 2002-03: Results of Missing an Opportunity
04 March, 2002, C.P. Chandrasekhar & Jayati Ghosh
In an implicit defence of the Budget proposals for 2002-03, Revenue Secretary S. Narayan attacked the corporate sector for failing to deliver. Speaking to representatives of the Confederation of Indian Industry during a post-Budget interaction, he argued that unlike last year when the budget provided Rs. 16,000 crore in the form of “giveaways”, this year’s budget offers none, because of the lack of resources resulting from the poor performance of industry.
Public Deficits and the Public Interest
01 November, 2001, Jayati Ghosh
Now that the economy is clearly in recession, it becomes more and more obvious to most players that the government must move quickly to pump prime the system and increase expenditure in order to revive economic activity. And indeed, the other features of the economy at present – such as the existence of huge surplus foodgrain stocks in the public sector and a comfortable level of foreign exchange reserves – ensure that such moves would not be inflationary but rather expansionary.
Monetary Policy: Desperate Measures
30 October, 2001, C.P. Chandrasekhar
In an uncharacteristic move, India's conservative central bank has sought to introduce significant changes in its monetary policy in its mid-year review released on the 22nd of October. It has decided to slash the cash reserve ratio from 7.5 to 5.5 per cent in two quick stages to allow for the release of additional liquidity into the system. It has reduced the Bank Rate, or the central banks' reference rate for interest by half a percentage point.
Food Policy: Lessons Half-Learnt
14 July, 2001, C.P. Chandrasekhar
Burdened with 65 million tonnes of foodgrain stock and expecting large arrivals at procurement centres when the new harvest comes in, the government has cut the issue price of foodgrains for the above-the-poverty line (APL) population by 30 per cent. This move, it is hoped, would reduce stocks substantially, helping the government find godown space to accommodate newly procured grain.
Has India Contained an Import Surge?
29 May, 2001, C.P. Chandrasekhar & Jayati Ghosh
According to official spokesmen, the evidence on trends in imports into India indicate that fears that import liberalisation would result in an import surge were misplaced. Rather, in their view, Indian producers have clearly been able to hold their own against international competition.
Fiscal Responsibility - To Whom?
18 February, 2001, C.P. Chandrasekhar & Jayati Ghosh
In the 1990s, legal restraints on government fiscal behaviour became something of an international fashion. As in much else in the world at the moment, this fashion was set by the United States, where in the mid-1980s the Balanced Budget and Emerging Deficit Control Act (Gramm-Rudman-Hollings Act) required a steady decline in the federal government's deficit to zero within a stipulated and fairly short time frame.
EAC Report: A Shoddy Guidebook for the PM
08 February, 2001, C.P. Chandrasekhar
The usually dormant Prime Minister's Economic Advisory Council (EAC) has chosen February, the budget month, to submit a report to the executive head of the nation. But do not be misled. This is not a report providing advice on what the government can do at budget time to resolve the crisis in agriculture, stall the slump in industry, or reduce the appalling deprivation that still haunts the nation. Blandly titled "Economic Reforms: A Medium Term Perspective", it is a collation of policy recommendations of the kind that the World Bank and the IMF have been gratuitously providing India over the last decade, and the official economic establishment has been regurgitating at periodic intervals.
Public Food Stocks : The Mess and the Wasted Opportunity
08 August, 2000, C.P. Chandrasekhar & Jayati Ghosh
The paradox of poverty amidst plenty, which has been so characteristic of the Indian economy over the 1990s, seems especially marked with respect to the foodgrain sector at the moment. Last year had witnessed record foodgrain production, especially of wheat and rice.
Exim Policy:Disturbing Bravado
04 April, 2000, C.P. Chandrasekhar & Jayati Ghosh
Exim policy 2000 does indeed mark a watershed, though not for the reasons advanced by the Commerce Minister. It begins the one year stretch during which India plans to dismantle all remaining quantitative restrictions (QRs) on imports. The announcement declares what India has been forced to accept because of US intransigence with regard to permitting India to maintain some QRs for reasons of balance of payments vulnerability. Restrictions on 714 of the 1429 items still subject to regulation have been lifted as of April 1st, and those on the rest would go in a year from that date.
The Telecom Mess
25 January, 2000,
Close on the heels of the Delhi High Court striking down crucial "decisions" regarding service provision and interconnection taken by the Telecom Regulatory Authority of India, the cabinet has decided to institute via an ordinance a whole new regulatory framework. There are three departures that are to be made in the new framework.
Disinvestment, at What Price
28 December, 1999,
Through the 1990s, consecutive governments at the Centre have advocated the sale of public sector equity as a means of public sector 'reform'. Equity sale, the industry policy statement of July 1991 argued, was a means of ensuring financial discipline and improving performance. The fact that there is little theoretical justification for or empirical validation of this position has of course been ignored. The immediate reason is fiscal convenience.

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