Tag: Sanjeev Sanyal

India must prepare for a US stagflation, says Sanjeev Sanyal

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Sanjeev Sanyal, a member of the Economic Advisory Council to the Prime Minister (EAC-PM), on Saturday, April 27, said stagflation in the US is a not a certainty, but a possibility that India needs to consider.

“The reason for it is simple – the fiscal is too loose and, in compensation, monetary is too tight. Until the former corrects, the latter cannot,” Sanyal said in a post on social media platform X, formerly known as Twitter.

Stagflation is an economic condition which combines slow economic growth, high inflation and high rate of unemployment.

US inflation witnessed its biggest increase in a year as it accelerated to 3.4% in the January to March period, up from 1.8% in the previous quarter.

The US eocnomy in the last quarter slowed sharpy to a 1.6% annual pace, in the face of high interest rates. However, consumers kept spending at a solid pace. The recent data from the US commerce department stated that the country’s GDP decelerated in the January to March quarter from its 3.4% growth rate in the final three months of 2023.

Consumer spending too increased 2.5%, maintaining a solid pace, even though it was down from the 3% in the previous two quarters. Americans spending on services — everything from movie tickets and restaurant meals to airline fares and doctors’ visits — rose 4%, the fastest such pace since mid-2021.

These are likely determining factors for traders to expect the first rate cut by the US Federal Reserve to be pushed to December, a Bloomberg report earlier this week stated.  Before the recent US data was released, the Street was estimating the American Central Bank to begin cutting interest rates in September.

Sanyal, in his post on X on Saturday, shared a Bloomberg article titled ‘The US economy may be barrelling towards stagflation, an outcome worse than recession’. The report summarised that the slower than expected growth, higher than expected inflation, and hotter-than-expected increase in consumer prices, put serious limits on the US Fed’s ability to take action. The central bank has made it clear that inflation needs to slow down for any rate cuts to occur.

The Bloomberg report stated that sputtering growth and higher prices are also key ingredients for stagflation, which can be harder to fight than a recession as the US Fed’s hands are tied due to the above mentioned factors.

“A stagflation situation in US in 2025 would have global consequences that will complicate macro-management for the rest of us,” Sanyal’s post on X stated.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Former bureaucrats call Sanjeev Sanyal’s comments on civil services exam preparation ‘absurd’

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Former bureaucrats on Wednesday described as “absurd” and “avoidable” the comments of Economic Advisory Council to the Prime Minister (EAC-PM) member Sanjeev Sanyal that five to eight years of preparation for the civil services exam by lakhs of students is a “waste of youthful energy”.

They said millions aspire to be part of the sought-after government services to contribute towards nation-building.

Sanyal has said that one should only attempt UPSC or other such examinations if one wants to become an administrator.

“As mentioned, it (is) perfectly fine to attempt the UPSC or other such exams, but only if the person wants to be an administrator. The problem is that lakhs of people are spending 5-8 years repeatedly doing this exam as a ‘way of life’. This is such a waste of youthful energy,” he said in a series of posts on social media platform X.

Reacting to his comments, former IAS officer G Sundaram said, “It is absurd. India is a vast country. We are interested in a united India and that is why Sardar Vallabhbhai Patel, (the first home minister of Independent India) created these services such as the Indian Administrative Service (IAS) and the Indian Police Service (IPS), among others. It is all working well.” There may be certain deficiencies which can of course be rectified, he said.

Sundaram, a 1962-batch IAS officer of Gujarat cadre, who superannuated as the Tourism Secretary, said, “His (Sanyal’s) comments were completely avoidable.” The Union Public Service Commission (UPSC) conducts the civil services examination every year in three stages — preliminary, main and personality test (interview) — to select officers for different central services.

S K Sarkar, former secretary of the Department of Personnel and Training, said Sanyal’s assertion was avoidable.

“It is not a waste of youthful energy or resources. I don’t agree with his assertion,” said the 1979-batch IAS officer of West Bengal cadre.

He said a lot of people aspire to be part of the government services. “These are the best services in India to contribute towards nation-building and development. His comments were avoidable.” Former IAS officer Sanjeev Chopra said Sanyal is entitled to his views but to be critical of youths who wish to be civil servants is not in good taste.

“Not everyone aspires to be an Ambani. People also want to be poets, painters and thespians. Many want to work for the government. And in the government there is no job more fulfilling than a district assignment, or a posting as a JS (joint secretary) in which you cover the entire domain,” he said.

“Sanyal is of course entitled to his views, but to be critical of young women and men who wish to be civil servants is not in good taste,” said Chopra, a 1985-batch IAS officer, who was also the Director of Mussoorie-based Lal Bahadur Shastri of National Academy of Administration — the country’s premier training institute for civil servants.

Another former bureaucrat, Kiran Puri, said preparing for the civil services examination “is not a waste of youthful energy”.

“Those who are academically strong and knowledgeable, they only join the civil services. Civil servants are needed to run this country,” the 1983-batch Central Secretariat Service officer said.

If talented people do not devote their energy and attention towards becoming a part of the civil services then how will the nation’s development be ensured, she posed.

“We need the best of minds to be part of the civil services to contribute to the growth of the country and to ensure further ease of governance,” said Puri, who served as the Joint Secretary in the Department of Administrative Reforms and Public Grievances under the Union Personnel Ministry.

Former chief election commissioner S Y Quraishi, however, partially agreed with Sanyal’s comments.

“He is partially right. Young people are putting in seven to eight years preparing for the civil services examination. Some people leave lucrative jobs and hefty salaries to be a part of these services,” he said.

Quraishi, a former IAS officer, suggested limiting the number of attempts being provided to appear in the civil services examination.

“There are too many attempts being provided for the civil services examination. It can be limited to a maximum of three attempts as it was earlier. There may be some extra attempts for people belonging to scheduled caste, scheduled tribe and other backward classes,” he said.

Serving IPS officer Pankaj Chaudhary also disagreed with Sanyal’s comments.

“Civil services exam and the UPSC act as the role model for many youngsters. These comments were completely avoidable,” said Chaudhary, a 2009-batch IPS officer of Rajasthan cadre.

He said the entire process of civil services examination is transparent and provides a level playing field.

“I was a topper of Hindi in the civil services examination in 2008. A person like me from a Hindi background could become a part of this service as the UPSC and civil services examination shows it is very credible and unbiased,” said Chaudhary, who is Superintendent of Community Policing in Rajasthan.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

10th SBI Conclave: Sanjeev Sanyal expresses optimism as banks’ gross NPAs hit decadal low of 3.2%

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Sanjeev Sanyal, a member of the Economic Advisory Council to the Prime Minister (EAC-PM), on Thursday, December 28, offered insights into India’s economic transformation. During his address at the 10th SBI Banking & Economics Conclave, he expressed surprise at the drop in gross non-performing assets (NPAs).

His remarks align with recent data outlined in the Reserve Bank of India’s “Trend and Progress of Banking in India, 2023” report, revealing a marked improvement in banks’ asset quality.

As of March 2023, the gross non-performing assets (NPA) ratio had plummeted to a decadal low of 3.9%, continuing its downward trajectory to 3.2% by September 2023.

Notably, around 45% of the reduction in gross NPAs in FY 2022-23 stemmed from “recoveries and upgradations.”

The report detailed the figures for FY 2022-23, depicting a considerable decline in gross NPAs across various bank categories. Public sector banks witnessed their NPAs drop to ₹4.2 lakh crore, while private banks, foreign banks, and small finance banks recorded NPAs at ₹1.2 lakh crore, ₹9,526 crore, and ₹8,608 crore, respectively.

This trend signified a substantial reduction in NPAs, with public sector banks (PSBs) seeing a reduction from ₹1.5 lakh crore to ₹1.02 lakh crore and private banks witnessing a drop from ₹43,738 crore to ₹29,507 crore in net NPAs.

In addition to banking reforms, Sanyal diverged from certain renowned economists’ perspectives, particularly disagreeing with Raghuram Rajan’s advocacy for a services export-led growth.

Instead, Sanyal underscored the need for a diversified approach, leveraging India’s vast domestic market and diverse population.

ALSO READ | SBI Chairman Dinesh Khara optimistic about India’s economic resilience, growth

Amid discussions on India’s global competitiveness, Sanyal injected a note of humor by attributing Mumbai’s pollution to the city “breathing the transformation.”

Further, Sanyal emphasised the socio-economic disparity between India’s Eastern and Western regions, urging a concerted effort to bridge this gap.

Highlighting the sluggish growth and economic disparities in states like Bihar, Jharkhand, and West Bengal, he stressed the role of infrastructural development, citing the Ayodhya airport as a prime example of how investments can spur growth in disadvantaged areas.

Sanyal also provided insights into the collaborative yet occasionally divergent viewpoints with figures like Viral Acharya on monetary policy and NPA resolution.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Inclusion of bonds in JPMorgan EM index will bring down cost of capital for India, says Sanjeev Sanyal

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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JPMorgan Chase & Co. has announced that it will include Indian government bonds (IGBs) in its benchmark Emerging Market index, marking a pivotal moment in India’s journey towards becoming an integral part of the global economy.

Sanjeev Sanyal, a Member of the Economic Advisory Council (EAC) to the Prime Minister, hailed this development as a momentous step forward. He emphasised, “The inclusion of Indian bonds in the JPMorgan EM index is one more form of inflow and access to capital that we have. In the long run, it positions India as part of the global economy, it lowers the cost of capital in India both for the government and overall as well. So, in that sense, the inclusion is good for bringing down the cost of capital in India.”

The journey toward this historic inclusion will begin on June 28, 2024, with JPMorgan gradually integrating IGBs into its benchmark index over a span of ten months, culminating on March 31, 2025. During this period, the weightage of IGBs in the index will increase by one percent each month. According to JPMorgan, India is expected to reach a maximum weight of 10 percent in the Global Diversified index (GBI-EM GD).

Sanyal stated that the inclusion of Indian bonds in the JPMorgan EM index will have a profound impact on the country’s economy. It is estimated that this inclusion will bring about approximately $24 billion worth of inflows into India. However, Sanyal highlighted that this is not the only index; there are several other indices like the Barclays, FTSE, etc. So, over time, if this becomes generalised and we become a normalised part of the global indices, then this can account for as much as $40 billion worth of inflows, Sanyal added.

Also Read:JPMorgan to add Indian bonds to its emerging markets index from June 2024

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Indian economy not falling behind, likely to grow at 6.5% in FY24: Sanjeev Sanyal

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Indian economy will grow at around 6.5 percent in the current fiscal and will continue to be the fastest-growing major economy in the world, notwithstanding a modest cut in growth projections by multilateral lending agencies, Economic Advisory Council to the Prime Minister (EAC-PM) member Sanjeev Sanyal has said.

Sanyal further said that given the uncertainties in the global economy, India’s performance is clearly far ahead of any other comparable economy.

“ADB (Asian Development Bank) and World Bank have only modestly reduced the (growth) forecast for this year. Even after this reduction, India will still be the fastest-growing major economy in the world,” he told PTI.

Recently, the World Bank and the Asian Development Bank projected moderation in Indian economic growth between 6.3 percent and 6.4 percent due to a slowdown in consumption and challenging external conditions.

The International Monetary Fund (IMF) also lowered India’s economic growth projection for the current fiscal to 5.9 percent from 6.1 percent earlier. Yet India will continue to be the fastest-growing economy in the world.

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“It is not correct to say that we are falling behind, my own assessment is in line with what the Economic Survey published earlier this year that (India’s economic) growth will be somewhere around six and a half per cent range, which is a good performance under the current circumstances,” Sanyal said.

Asked what it will take for India to grow at 8-9 percent per annum, he said that due to the large number of reform measures taken by the Modi government, India’s supply side is now capable of driving growth over 8 per cent.

“However, at a time when the rest of the world economy is rapidly slowing down, we will not be able to push growth too hard past the current level of six-and-a-half per cent because growth of 8 percent type level would mean that our imports will dramatically go up at a time when our ability to push exports would be constrained by global demand,” he noted.

Therefore, Sanyal argued that from a macroeconomic stability perspective, India will have to be restrained in its expectations of what the country can do at this point of time.

“However, should the world find itself in a more conducive environment which will happen eventually, then India will be easily able to accelerate its growth performance,” he said.

Replying to a question on the impact of the US and European banking crisis on India’s financial sector, Sanyal said India’s financial sector will not see any direct impact as the country has put in a lot of effort to clean up its banks and remove the non-performing assets (NPA’s) using both capitalisation and the insolvency and bankruptcy process.

While noting that Indian banks are well capitalised and have plenty of buffers, he said, “Nonetheless, the fact is that we live in an interconnected world and therefore, economic shocks including financial shocks do have second-order impacts.” According to Sanyal, therefore, India needs to continue to be very vigilant.

Last month, finance minister Nirmala Sitharaman reviewed the performance of public sector banks (PSBs) on various financial health parameters and their resilience in the wake of the current global financial scenario emanating from the failure of some international banks in the US and Europe.

ALSO READ | Indian economy projected to grow at 7% in 2022-23: Nirmala Sitharaman

Asked whether the Adani crisis will complicate India’s infrastructure ambitions, Sanyal said that he does not think any particular entity can explain the wide range of infrastructure that is being built.

“Of course, private spending (in infrastructure) was also welcomed in certain areas such as telecommunications. And even then, there doesn’t seem to be any major paucity of interest,” he pointed out.

Adani group has been under severe pressure since the US short-seller Hindenburg Research on January 24 accused it of accounting fraud and stock manipulation, allegations that the conglomerate has denied as “malicious”, “baseless” and a “calculated attack on India”.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

From 21 Lessons For 21st Century to Being Mortal: 5 books that influenced Capgemini India CEO Ashwin Yardi

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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I love to read books on all topics. A diverse preference opens one’s mind to new ideas — there’s a lesson you derive from every book and can apply to different fields. A book on history may influence how we look at technology. One on culture can help us shape our planet for the future. Ultimately, that is the beauty of literature!

Here are some books that have influenced me:

21 Lessons For 21st Century – Yuval Noah Harrari, 2014

The book captures a wide range of topics — from the future of work to religion and God to nationalism — all relevant topics for the world today. What caught my attention was Hariri’s prediction that data will eclipse both land and machinery as the most important asset.

Hariri’s contention that “the problem of groupthink and individual ignorance besets not just ordinary voters and customers but also presidents and CEOs” is a lesson in corporate management and to leaders.

And finally, the recurring notion of “global solutions to global problems” he espouses has convinced me that as the world gets closer and smaller, “we are indeed all in it together.”

The Singularity Is Near — Ray Kurzweil, 2005

Imagine these predictions in 2005: Computers will pass the Turing Test by 2029; nanobots will cure any disease or heal any wound, including those in the brain.

That’s the singularity Kurzweil espouses the ‘merging point’ between machine intelligence and humans. And the most fascinating thing? Technology will enable understanding of the human brain to a degree where we can upload someone’s neural structure onto a computer or a robot. I can’t wait to see the outcome of this prediction!

For me, Kurzweil’s was arguably the best exposition of the law of accelerating returns — technology advances exponentially because every advance fuels the next.

Land Of The Seven Rivers — Sanjeev Sanyal, 2012

This book gave me the pride of belonging to this great country. It showed our country in a new light. It’s probably the best “history of geography” about India — our land, our majestic civilisations along our great rivers, and how it has shaped our people and history.

The book also details the expansion of Indian civilisation into countries like Thailand, Vietnam, and Indonesia. It illustrates the risk appetite for the entrepreneurial culture of Indians even in ancient times.

Nowhere have I found it more clearly stated or with more proof than in this book, that ultimately, despite differences in our colours, castes, or religions, all Indians are the same. One book that convinced me that to know the present, we should know our past!

Being Mortal — Atul Gawande, 2014

Seeing the turmoil unleashed by the COVID pandemic, I realised how right Atul Gawande was! He convinces us that there is more to medicine than routine treatments. And what stays during our last moments are our values and personal relations.

Though it was written long back, he has portrayed brilliantly the intricacies of doctor-patient relationships. Gawande’s turmoil — confusing treatment with care — isn’t limited to the medical field alone. It’s common and useful to professionals across most disciplines. A must-read for anyone who has to make decisions for others, not just doctors.

How To Avoid A Climate Disaster — Bill Gates, 2021

A corporate leader pitching for climate change isn’t new. What stands out is the balanced approach Gates adopts and the workable solutions he suggests, especially how sustainable growth and progress need not come at the cost of socio-economic growth.

What influenced me most was, Gates recognises that both morally and practically any solution to climate change must not penalise the less-well-off in the world. Most solutions getting publicity today (Tesla cars, push for vegetarianism) must ensure these practices are within the means of all societies and truly workable if they are to have an impact. That’s where our efforts should really be.

Conclusion:

Each of these books has impacted me greatly. They have ignited new thought processes about my own life, provided lessons on leading a large organisation, and generally about things around us and our future. The key takeaway is, life isn’t about avoiding problems but taking them head-on — the end result should be to make the world a better place.

—Ashwin Yardi is the CEO of Capgemini, India. Views expressed are personal.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

6,000 km of Bharatmala projects to be awarded this fiscal: NHAI Chairman

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Giridhar Aramane, the Secretary of the Ministry of Road Transport & Highways and the Chairman of National Highways Authority of India (NHAI), Thursday, said that the 6,000 km of Bharatmala projects will be awarded in FY22.

Aramane also spoke about the expected project pipeline for roads and the expected execution for the year.

The Principal Economic Adviser, Sanjeev Sanyal, while making an important statement in an interview to CNBC-TV18, said that the government does intend to keep up with its expenditure programme and that the roads and highways sector in the infrastructure sector is going to be an important part in terms of the growth ahead.

So, spends have been picking up, there is an unlocking of more funds with the NHAI’s infrastructure investment trust (InvIT) that the market is awaiting.

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“We have a very good pipeline as the Cabinet had approved Bharatmala programme in 2016-17. So far this year, there is no problem because of the good work done over the last 1.5-2 years by both the board of the NHAI as well as the Standing Finance Committee of the ministry. The pipeline with solid viable projects is going to give us good achievement this year also,” Aramane said in an interview to CNBC-TV18.

According to him, 6,000 km of Bharatmala projects will be awarded in FY22. “For FY22, our total target for award is around 6,000 km because the greenfield highways, most of them are in advance stages; either they have been awarded, under construction or underbidding. So, we are likely to award most of the greenfield highways by the year-end,” said Aramane.

Also Read | Government Intends To Spend Strongly On Infrastructure, Says Sanjeev Sanyal

“There will be 2-3 access control highways (limited and designated entry and exit points), which will be pending for the next financial year. So, this 6,000 kilometre of Bharatmala projects, costing around Rs 2.5 lakh crore, will be awarded this year and also this will involve a lot of private investment as the hybrid annuity model (HAM) has become the favourite of the developers, which involves 60 per cent of private investment and government contributes 40 per cent,” he said.

On monetisation, Aramane said, “We are on track on national monetisation pipeline implementation also. Rs 30,000 crore is the total target for this year and out of that around Rs 10,000-12,000 crore have to be spent on the Delhi-Mumbai Expressway. So most of the expenditure that will incur will generate through monetisation will be on the Delhi-Mumbai Expressway. InvIT, we are expecting to mobilise around Rs 8,000-9,000 crore.”

Also Read | Here Are Key Features Of Delhi-Mumbai Expressway

He further said that NHAI will be looking to put up charging infra (for electric vehicles) at 50-60 km intervals on all the national highways.

For the entire interview, watch the video

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Moody’s GDP forecast for India is low; negativities around Indian economy proven wrong, says Sanjeev Sanyal

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The negative analysis around the Indian economy over the last few months has proven to be wrong, said Principal Economic Adviser Sanjeev Sanyal on Wednesday. Raising the country’s outlook on the sovereign rating to ‘stable’ from ‘negative’, he further said that Moody’s GDP forecast for India is low.

The rating agency expects the medium-term real GDP growth to average around 6 percent.

“We intend to iron out all issues to see India’s inclusion in global bond indices,” he said.

“We are working with bond index agencies to work out remaining issues. The government intends to stick to its fiscal numbers,” he added.

“It is merely recognition of the obvious that some of the more hysterically negative outlooks and analysis that we saw a few months ago has clearly proved to be wrong. I wasn’t too thrown off when they put us on a negative watch and I am not going to be wildly exuberant because we have been put on stable or even if we move into a positive watch. What we need to do is to watch the data rather than get too excited about certification by various agencies,” he said.

Also Read: Moody’s needs to take into account India’s reforms while estimating growth rate: CEA Subramanian

When asked if he had any idea of meeting with regards to the other indexes and if one could expect it in this calendar or in this fiscal year, he said, “I can’t comment on a private agencies calendar. So, what I can say is that there are some very small niggling issues. 99 percent of the issues have been already dealt with. There are some very small niggling issues and they will be worked out. There are some issues on their side as well, which they will work up. So with a few iterations, we should be there soon.”

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

India has fiscal resources and monetary space for more govt intervention if needed: Sanjeev Sanyal

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The country has enough fiscal resources and monetary space left for intervention and government will pump funds if required to salvage the economy from the COVID pandemic, principal economic adviser Sanjeev Sanyal said on Tuesday. Sanyal said he expected it to register double-digit growth this fiscal and the next unless there is any major disruption.

Infrastructure spending remains the key focal point of India’s strategy with regard to government spending to spur demand. It would like to invest in infrastructure rather than transfer money in the hope of reviving the economy, he said at a business summit here. “Besides, capital spending has multiplier effects. We have kept fiscal and monetary space. We will pump (in money) when required (for COVID pandemic). We will ramp it up but through capital expenditure. As even with good revenues, we will have a deficit. We want to keep a large amount of assets for the next generation to serve debts”, Sanyal said at the CII organised East India Summit.

Infrastructure is the key and central to the strategy for the country in the long term and to come out of the COVID pandemic, he said. India has also undertaken several supply-side structural reforms besides deregulation.

“We could have pressed the accelerator harder but we remained flexible as we knew it was not a sprint but a marathon. We didn’t opt for a big bang approach of large transfers. What we did is different than many other countries”, Sanyal explained. Going forward asset monetisation would also a key strategy for the country, he added.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow