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Nameste Team!

Please check out my specific feedback and suggestions, for team to consider especially for REPORT:

Prelim Analysis - India's Economic growth [GDP]

Missing prelim analysis, although key points identified.

1. Yes, private consumption reported as being strong. Find out what caused this to happened. How does this impact real GDP?
2. Structural reforms, raising productivity and investments were mentioned in the article. Why is there a need for India to undergo reform? What is the importance of increasing productivity? Hint: Refer to lecture 1 on economic growth and development.

Prelim Analysis - Unemployment in India
Hmm, this piece of article identified several types of unemployment. Please re-read and spot them. Hint: "as a fresh batch of college graduates enters the workforce in May...." - What type of unemployment is this? Is the government doing anything about it? Note: for sharing of labour policies, please keep it short and concise.  At least one more!

Prelim Analysis - Inflation
Missing prelim analysis too.
1. One of this, cost-push or demand pull inflation is mentioned in the article. Identify it and elaborate further.
2. Monetary policy is being mentioned in this article but we haven't cover that in lecture yet. You might want to KIV and try applying this later on.
3. What is India's targeted inflation rate? Compare this to the current level. Any cause for concern?

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Released on 21 April 2018

-"Indian Economy is expected to grow at an annual rate of 7.4% in 2018 and 7.8% in 2019" this shows that India's economy is growing at a fast rate compared to other developing countries such as China.

- India plans to rebalance towards private consumption and focus more on services rather than industries. Private consumption increase due to the the structural reforms that help raised productivity and incentivize private investment. This helped increased real GDP with more output meaning the economy is growing.

- India's economy growth rate was average at 6.13% from 1951 to 2017

- India's economy growth uses resources to raise their GDP however their GDP growth can be raised with better employment of excess resources with existing technologies

-  India need to undergo reform so as to increase productivity and incentivize private investment so as to attract companies to invest in their countries. This would mean more output with better physical capital meaning real GDP would increase.

-India's economy will improve with the structural reform and thus will be able to raise their real GDP in order to help further improve the economy of India. Furthermore workers are learning new technical skills in order to further develop the country and this would help the India's economy overall.

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Prime Minister Narendra Modi may be unpopular among Indian citizens lined up in front of empty ATM machines lately, but his policies seem to have helped the Indian economy regain momentum and be on track to beat China's economy.

On economic growth rates that is.

The Indian economy is expected to grow at an annual rate of 7.4% in 2018 and 7.8% in 2019, according to a recently released IMF Economic Outlook. India's economy is "lifted by strong private consumption as well as fading transitory effects of the currency exchange initiative and implementation of the national goods and services tax," notes the report. "Over the medium term, growth is expected to gradually rise with continued implementation of structural reforms that raise productivity and incentivize private investment."

India's projected 2018-19 growth rates are well above China's 6.6% and 6.4% over the same period. And things could get even worse for Chinese economic growth over the long-term, due to the continued rise of the country's nonfinancial debt. "Over the medium term, the economy is projected to continue rebalancing away from investment toward private consumption and from industry to services, but nonfinancial debt is expected to continue rising as a share of GDP, and the accumulation of vulnerabilities clouds the medium-term outlook," notes the IMF report.

GDP annual growth rate in India averaged 6.13% from 1951 until 2017, reaching an all-time high of 11.40% in the first quarter of 2010 and a record low of -5.20% in the fourth quarter of 1979, according to Tradingeconomics.com.

To be fair, India's economic growth begins at a low level of resources utilization. Therefore, it can raise GDP growth by the better employment of excess resources with existing technologies. China's economy, by contrast, begins at higher resource utilization levels. Therefore, it can no longer raise GDP growth by using existing technologies. It must innovate, and that isn't easy given China's current economic structure where most of its economic sectors are under direct or indirect government control.

That could explain why India is beating China in another metric: competitiveness. In the last four years, India gained 20 points in the World Economic Forum's ( WEFR) Global Competitiveness rankings, while China's ranking remained roughly unchanged - see table.
India's And China's Competitiveness Rankings For Selected Years Source: Tradingeconomic.com; World Economic Forum

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Prime Minister Narendra Modi may be unpopular among Indian citizens lined up in front of empty ATM machines lately, but his policies seem to have helped the Indian economy regain momentum and be on track to beat China's economy. On economic growth rates that is.

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Released on 28 February 2018

- Estimated number of 31 million Indians deemed as unemployed

- Unemployment rate always on the high rise in India; concerning issue

- Towards the end of 2016, unemployment has receded due to government's measure on demonetization

- Labor participation rate was 46-48% back then. The Reserve Bank of India (RBI) remonetize to help bring more labour participation. However there were not enough jobs around.

-  Fell down to a celebratory 3.4% of unemployment rate in July 2017 until it is on the rise again recently in Feb 2018

- Following this, an anticipation of spike in demand of jobs and unemployment rate will go up again in May when a fresh batch of college graduates enters the workforce. This is frictional unemployment which is the normal search time by workers.

-  After the note ban in November 2016, workers sat out of the workforce to acquire new skills instead of searching for new jobs. This is structural unemployment where there is a mismatch of skills and workers are required to pick up new skills.

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The number of jobseekers in India, rising steadily over the last few months, spiked to 7.1% in the week ended Feb. 25.

There are around 31 million unemployed Indians seeking jobs now-the highest since October 2016, according to a report published on Feb. 27 by the Centre for Monitoring Indian Economy (CMIE), a think-tank that tracks business and economic data.

After falling to a low of 3.4% in July 2017, unemployment rates have been rising gradually, the CMIE data show.

"Given that the recent three weeks have consistently shown unemployment rates at close to 7%, it is possible to infer now that the rate is back to the levels just before demonetisation," Mahesh Vyas, CEO of CMIE, said in the report. While the absolute unemployment number isn't alarming, the steady rise is, he added.

Unemployment rates fell for a few months after the note ban in November 2016, as jobseekers sat out of the workforce and focused on acquiring new skills instead of waiting to find jobs in a tough economy.

During that period, the labour participation rate (the total number of people employed or actively hunting for jobs) hovered between 46% and 48% before demonetisation. By July 2017, it fell to below 43%. Now the CMIE expects it to go past 44% by the end of February 2018.

"The labour force has still not recovered entirely, and remonetisation by the Reserve Bank of India (RBI) was not enough to bring labour participation to its earlier levels," Vyas said.

While people are returning to the workforce, there aren't enough jobs around.

"The coming months are not the best for employment," Vyas said. Activity in rural India will slow down after the rabi crop is harvested and won't pick up until the kharif season begins in May, he added.

In addition to the 31 million unemployed as of Feb. 25, urban India will see a spike in demand for jobs as a fresh batch of college graduates enters the workforce in May. But the number of jobs created in financial year 2018 is an estimated 600,000.

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Around 31 million Indians are unemployed, and it will only get worse

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The number of jobseekers in India, rising steadily over the last few months, spiked to 7.1% in the week ended Feb. 25. There are around 31 million unemployed Indians seeking jobs now-the highest since October 2016, according to a report published on Feb. 27 by the Centre for Monitoring Indian Economy (CMIE), a think-tank that tracks...

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Released on 12 March 2018

- For the first time in three months, India’s inflation rate dropped below 5 percent
- Giving the central bank room to keep interest rates on hold for longer period of time providing relief to battered bond investors.

- It has been noted that India’s inflation rate dropped below 5 percent for the first time in three months.

- According to the Government data, it has shown that inflation in February was at 4.44 percent

- Which is lower than the 5.07 percent pace in January and below the 4.7 percent estimate of economists polled by Bloomberg News.

- We have identified that cost-push inflation was being mentioned in the article. Due to the increased production costs of vegetables that drives the price of global wheat.

- The central bank of India expects inflation to reach 5.1-5.6 percent in the first half of the financial year starting April 1, before easing in the second half. And the RBI targets inflation over the medium term at 4 percent with an upper limit of 6 percent and a lower threshold of 2 percent

but has a current level
of 4.55%

Cause of concern:
The inflation rate was supposed to increase but it fell instead and as the article stated that it has made it the worst market in the Asian market and this would make cause goods and services prices to drop hence causing the real GDP to drop as well

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India's inflation rate dropped below 5 percent for the first time in three months, giving the central bank room to keep interest rates on hold for longer while providing relief to battered bond investors.

Government data on Monday showed inflation at 4.44 percent in February, lower than the 5.07 percent pace in January and below the 4.7 percent estimate of economists polled by Bloomberg News. The easing for the second straight month offers bond investors in India -- the worst performing market among major Asian economies -- something of a temporary cheer. The benchmark 10-year bond yield fell three basis points to 7.60 percent.

"The sharp dip in retail inflation has reinforced our expectation that the MPC would keep the repo rate unchanged in the upcoming policy review in April, which may prompt a further easing of bond yields in the immediate term," Aditi Nayar, economist at ICRA Ltd. said referring to the central bank's Monetary Policy Committee that's scheduled to meet April 4-5.

India's Slowing Inflation

Second straight month of easing

Source: Ministry of Statistics & Programme Implementation and the RBI

Most analysts and the Reserve Bank of India itself expect inflationary pressures to gather steam in coming months. The central bank expects inflation to reach 5.1-5.6 percent in the first half of the financial year starting April 1, before easing in the second half. The RBI targets inflation over the medium term at 4 percent with an upper limit of 6 percent and a lower threshold of 2 percent.

Inflation above the RBI's 4 percent target doesn't warrant concern about a buildup in price pressures. The reason -- the output gap remains wide and there are no signs now of demand-side driven inflationary pressures.

-- Abhishek Gupta, Bloomberg Economics

Last month, one member of the six-member monetary policy committee voted for a rate hike, another gave up his call for rate cuts while Deputy Governor in charge of monetary policy, Viral Acharya, also veered more toward the hawkish camp. The rest, for now, appeared neutral. Still, the MPC voted to keep rates unchanged at its last meeting and flagged the government's decision to widen budget deficit targets as something that will have an inflationary impact.

"The RBI will have room to push back a rate hike, but not for too long as input price pressures have been on the rise over the past one year, and price pass-through to consumers is now taking place," said Teresa John, economist at Nirmal Bang Pvt. Equities Ltd.

Food price index rose 3.26 percent versus previous month's 4.7 percent rise

Vegetables prices rose 17.6 percent, slower than previous month's 27 percent

Figures due Wednesday will probably show wholesale price inflation surged 2.50 percent in February from a year earlier, slower than January's 2.84 percent pace

Analysts expect food inflation to rise because of the seasonal upturn in vegetable prices in the summer, an increase in minimum support price of summer crops that will reflect with a lag, and an upswing in global wheat prices. Moreover, core inflation is sticky at around 5 percent, while an imposition of more tariffs on some imports like mobile phones is likely to boost price pressures, and may prompt RBI to wait and watch.

Uptick

Separate data showed industrial production rose 7.5 percent in January, handily beating estimates of a 6.4 percent rise and a growth of 7.1 percent in December. Also, private sector data showed local passenger vehicle sales grew 7.8 percent in February from a year ago, highlighting steady demand in the economy.

Nevertheless, the recovery from the cash ban and the chaotic introduction of the consumption tax last year has been uneven. India's dominant services sector contracted in February, with scandals hitting the corporate and banking sectors and weighing on business sentiment.

The RBI expects growth to pick up in the next financial year. It sees gross value added -- a key measure of growth -- increasing 7.2 percent next fiscal year from 6.6 percent this year.
- With assistance by Manish Modi

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Easing India Inflation Reprieve for Asia's Worst Bond Market

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India's inflation rate dropped below 5 percent for the first time in three months, giving the central bank room to keep interest rates on hold for longer while providing relief to battered bond investors. Government data on Monday showed inflation at 4.44 percent in February, lower than the 5.07 percent pace in January and below the 4.7 percent estimate of economists polled by Bloomberg News.