In his new IDFC Institute (@IDFCinstitute) Working Paper, Dr Niranjan Rajadhyaksha (@CafeEconomics) asks if India
simultaneously met the targets in a hypothesized '2-4-6-8' macroeconomic framework that, without explicit enunciation, one can assume it has followed over the past decade or so:
with a 2% target for the Current Account Deficit, an Inflation Target of 4%, a 6% target for its Consolidated Fiscal Deficit (i.e. fiscal deficits of states and the Centre combined, as a percent of national GDP) and an 8% (aspirational) target for RGDP
growth. The short answer is No, but even the more nuanced answer cannot see the glass as half-full. the Table below shows the results over the last decade. The caveat being that, except for the inflation target and the target for the consolidated fiscal deficit (which have each been set out explicitly), the other two targets have not been explicitly stated, and the RGDP 'target' is more aspirational than normative in nature.
The data for the past decade with respect to these big macroeconomic variables is set out in the Table below.But, left-to-right, the targets for the variables in the columns are actually in the order
8-4-6-2]
The best years for Growth & Inflation: 2015-16 and 2016-17 (8% 4.9%; and 7.9% 4.5%) but these are also years with fiscal deficits higher than target & with the Current Account Deficit below target. The Working Paper nicely explains a #Trilemma that Indian macroeconomic policy faces (as do the macroeconomic policies of all countries similarly situated), suggests the right choice of path among the three, and further strongly recommends that future targets should not only be internally consistent but also with the Tinbergen Rule, named for Dutch economist Jan Tinbergen, that the number of variables to be controlled and the number of policy instruments available for the purpose must be equal.
Added 11 June 2019: In this video clip, Dr Rajadhyaksha speaks with Ira Dugal of BloombergQuint on 'revisiting the 2-4-6-8 Macroeconomic Framework':
.@PhadnisShilpa & @sujitjohn write in the Economic Times that #GlobalCapabilityCentres set up by Multi-national companies in India initially in the 1990s, have transitioned from having business models based on cost arbitrage centers to #Engineering R&D value creators; developing, for example, generic malware signature generators (including by using Generative Adversarial Networks in #MachineLearning) to address issues in #Cybersecurity. The total employment in such GCCs located in India is now estimated at 1 million, with the overall value created of $28 billion.
.@GoI_MeitY's 'India's Trillion Dollar Digital Opportunity' strategy, w @McKinsey; develops a Country Digital Adoption Index CDAI on 30 metrics across 3 categories: Digital: 1)Foundation (availability/affordability]; 2)Reach[penetration] 3) Value (adoption of digital use cases) pic.twitter.com/zvYaqrjy05
Finds growth in India's CDAI over 2014-17 is 90% (cf Indonesia 99%). Economic value added projected at upto $1T across 30 Digital Themes; the greatest $205-250 B to emerge from the ‘Vibrant Digital-BPM’ theme, with Business Digitization/IoT Analytics projected to add $105-120B pic.twitter.com/bUqFfZtWUD
Dr Urvashi Aneja (@urvashi_aneja) writes for Chatham House (@ChathamHouse) on the challenges ahead of India's #AIForAll Strategy: despite great promise, the strategy cannot be a panacea for all of India's social and economic needs; it will be constrained, for example, by India's existing data systems – which could be outdated, fragmented, or unrepresentative of the population at large. More than just that, the existence of #DigitalDivides across gender, region, age, class and language means that even existing data, when cleaned, up to date, verified or integrated to the extent possible could contain severe biases in the best of circumstances. But some data challenges may remain even if internet penetration increases, alleviating the #DigitalDivides. For example, one might need new means of #DataCapture and verification. #DataPrivacy will remain a challenge despite a consent-based disclosure regime because *informed* consent needs both IT and basic literacy, and thus practice of ethical AI could conflict with obtaining unbiased or complete data.
But the challenges facing an all-India AI strategy will not stop at Data issues. Implementation of AI in industry could result in labour disruptions, for example if Western economies were to use the potential of AI for intelligent automation in manufacturing, business processes or services, one could have the phenomenon of '#Reshoring' or '#RightShoring' the thematic opposite of 'Offshoring'. This might impact the economic rationale for #MakeInIndia, or indeed, also the BPO/IT industry. Simple BPO work could be automated altogether. At the same time, AI-enabled #Globotics, a possibility in which work could be done remotely (internationally), during a transitional phase (or even longer) present a possible opportunity. Thus the 'AI for All' strategy needs to navigate a tricky future trajectory. via @samirsaranhttps://t.co/v4rBl05yxE
Mr. Jitendra Jadhav, Director of the National Aerospace Laboratories (NAL) outlines the technology and design envelope of the Regional Transport Aircraft (RTA) project in this video (which is a pre-Aero India 2019 Webinar) in the overall context of the Ministry of Civil Aviation's UDAN (Uday Desh ka Aam Nagarik) Program. The timeline envisaged for a flying prototype is 70 months.
The Regional Transport Aircraft, designed mainly to ply between Tier-II and Tier-II cities in India, (conforming to a forecast of 500 million passengers by 2027 and actual projected needs of Indian airline operators) is envisaged to embody a number of advanced technologies, including the Natural Laminar Flow Wing, a Next Generation Power Plant (to be imported), Fly-by-wire flight control (with a matching display system), Open Distributed Modular Avionics (with facilities such as GPS-WAAS [the Wide-Area Augmentation System using GPS], the ADS-B [Automatic Dependent Surveillance - Broadcast] system for aircraft tracking]), Active Vibration and Noise Control.
Furthermore, advanced aerospace maintenance concepts, such as Integrated Vehicle Health Monitoring (IVHM) and Structural Health Monitoring (SHM) are expected to be incorporated into the aircraft technology envelope right from the beginning, to function with a Lean Ground Infrastructure (which, given that the aircraft will ply Tier-II and Tier-III city airports, is a significant consideration). And in order to enable better fuel efficiency, it is proposed that (i) the airframe will be made of (lighter) advanced composites, (ii) Aerodynamic drag reduction will be utilized, especially in the Natural Laminar Flow Wing, and (iii) a next generation power plant with an optimized turbine and compressor will be used. Other advanced materials will also be used in coatings, enabling functionalities such as self-cleaning, anti-icing, and abrasion-resistance in the airframe and engine.
The initial prototype will build on the earlier progress with the 19-seater version of the Saras. The video also discusses a number of other advanced ideas, including how the entire Vehicle Health Management functionality will be networked to a central core computer, with the Avionics and Flight Control modules directly interfacing with Diagnostic/Prognostic algorithms.
While I have outlined just the core of the presentation in this blog, the full Webinar contains many other details, and includes what I thought was a very interesting Q&A session at the end, with many probing questions asked by Webinar attendees. To list a few: (i) Where will the Advanced Turboprop engine be sourced from? (ii) What are the details of the strategy for controlling maintenance costs? and (iii) How will the specific fuel consumption (SFC) be reduced?
Overall, an interesting webinar on NAL's RTA Project!
.@mihirssharma: With oil prices rising, #India faces a ↑ #CurrentAccount deficit ≲ 2.9% GDP, a depreciating ₹, a tightening monetary stance in part 2 stem domestic inflation; thus perhaps even a slowing economy in 2018-19... (But) 'import dependence... https://t.co/h0vp0muVDW
... need not be a chronic disease. There is a cure: Exports'! (India's exports have fallen to their lowest level as %GDP since ~2003! Any fall in the ₹ should be seen as the boost it can actually be for exports... via @EconomistDK@bsindia@bopinion
...processes – in which steppe herders (4m present-day Kazakhstan, home 2 the original #IndoEuropean speakers) mixed w farmers 4m #Iran & then moved both Westward 2 #Europe & Southeastward 2 India to further mix w populations already there - extent of admixture perhaps varying...
...and how #China could end up being in it – in part because Iran’s vision (in which #Teheran is @ the center of a Vienna-Beijing rail line) blends better w China’s overall vision under #CMSR & #OBOR, but also because of #China's gr8r experience in delivering on such projects... pic.twitter.com/wSMpwi424S
