Buoyant again: on India’s GDP growth
But this GDP growth coincides with higher public spending, which risks fanning inflation
The latest economic data from the Central Statistics Office reveal that India’s GDP expanded at a brisk (तेज़) 7.2% pace in the three months ended December, an acceleration from the 6.5% posted in the second quarter. On the face of it, the numbers are cause for cheer and optimism (अच्छा पक्ष देखना), with gross fixed capital formation, a key measure of investment demand, showing a healthy improvement. Sectoral gross value added (GVA) figures also reflect a broad-based pickup in activity from the preceding quarter. The only three laggards ( सुस्त संस्था) last quarter were mining; utility services (including electricity, gas, and water supply); and trade, hotels, transport and communication services. The contraction (सिकुड़न) in mining is of particular concern. The October-December quarter in 2016 was, however, the period when the Centre implemented the widely disruptive demonetisation of high-value currency notes, and so one has to bear in mind the base effect on the latest third-quarter data. Also, the CSO’s second advance estimates of national income for the full financial year are a lot more sobering (अप्रमत्तता). Both GDP and GVA growth estimates for 2017-18 have been revised upwards from the first-cut projections made in early January — GDP growth to 6.6% from 6.5% earlier as a result of GVA expansion being lifted to 6.4% from January’s 6.1%. But the assumption for increase in net taxes has been pared (छीलना), reflecting the struggle to ensure buoyancy (प्रफुल्लता) in GST revenue collections.
A study of the full-year projections reveals the pressure points. The same sectoral GVA data that at a quarterly level appeared to give promise of a more enduring (चिरस्थायी/स्थायी) recovery show momentum in five of the eight sectors decelerating. Of particular concern are the farm sector, where growth is set to slow to 3% from 6.3% in the previous fiscal; and manufacturing where the pace is expected to ease to 5.1% from 7.9% in the revised estimate for 2016-17. The latest Index of Industrial Production numbers that show manufacturing in April-December still significantly lagging behind the previous nine-month period, as also the Nikkei India Manufacturing Purchasing Manager’s Index that shows growth in the sector slowed to a four-month low in February, add to concerns about manufacturing. With private final consumption expenditure, a crucial driver of economic momentum, still to gain traction (खिंचाव) over the full financial year, it is increased government spending that has undergirded (सुदृढ़) the expansion. Here lies the rub. The leeway (छूट/गुंजाइश) for more pump priming is restricted as fiscal deficit at the end of January has already exceeded 113% of the revised estimate for the full year. Any more profligacy (फ़िज़ूलखर्ची) by the government risks threatening price stability. With the banking sector beset (घेर लेना) by bad loans and increased scrutiny (सूक्ष्म परीक्षण) on lending in the wake of frauds, and exporters still to make the most of the revival in global trade demand, the economy is not yet out of the woods.
- Brisk: having much high-spirited energy and movement
Synonyms: active, airy, animate, animated, bouncing, energetic, frisky, gay, jaunty, jazzy, kinetic, lively, mettlesome, peppy, perky, pert, racy, snappy, spanking, sparky, spirited, sprightly, springy, vital, vivacious, zippy
Antonyms: dead, inactive, inanimate, lackadaisical, languid, languishing, languorous, leaden, lifeless, limp, listless, spiritless, vapid
- Optimism: an inclination to believe in the most favorable outcome
Synonyms: bullishness, sanguinity
Antonyms: bearishness, pessimism
- Laggards: moving or proceeding at less than the normal, desirable, or required speed
Synonyms: crawling, creeping, dallying, dawdling, dilatory, dillydallying, dragging, lagging, languid, leisurely, poking, poky (or pokey), slow, sluggish, tardy, unhurried
Antonyms: barreling, bolting, breakneck, breathless, brisk, careering, dizzy, fast, fleet, flying, hasty, hurrying, lightning, meteoric, quick, racing, rapid, rocketing, running, rushing, speeding, speedy
- Contraction: the act or process of reducing the size or volume of something by or as if by pressing
Synonyms: compacting, compaction, compression, condensation, condensing, constricting, constriction, contracting, squeeze, squeezing, telescoping
Antonyms: decompression, expansion
- Sobering: Creating a more serious, sensible, or solemn mood.
- Pared: to make (something) shorter or smaller with the use of a cutting instrument
Synonyms: bob, clip, crop, cut, cut back, dock, lop (off), nip, poll, prune, shave, shear, snip, trim
Antonyms: elongate, extend, lengthen
- Buoyancy: A cheerful and optimistic attitude or disposition.
Synonyms: cheerfulness, cheeriness, happiness, light-heartedness, carefreeness, brightness, gladness, merriment, joy, bounce, effervescence, blitheness, sunniness, breeziness, jollity, joviality, animation, liveliness, life, sprightliness, jauntiness, ebullience, high spirits, vivacity, vitality, verve, sparkle, zest
- Enduring: having an existence or validity that does not change or diminish
Synonyms: abiding, ageless, continuing, dateless, eternal, everlasting, immortal, imperishable, lasting, ongoing, perennial, perpetual, timeless, undying
Antonyms: antiquated, archaic, dated, obsolete, outdated, outmoded, out-of-date, outworn, passé
- Traction: The extent to which an idea, product, etc. gains popularity or acceptance.
- Undergirded: to hold up or serve as a foundation for
Synonyms: bear, bolster, brace, buttress, carry, prop (up), shore (up), stay, support, sustain, underpin, uphold
- Leeway: an allowable margin of freedom or variation
Synonyms: latitude, slack, space, wiggle room
- Profligacy: immoral conduct or practices harmful or offensive to society
Synonyms: corruption, debauchery, depravity, immorality, iniquitousness, iniquity, libertinism, licentiousness, sin, vice
Antonyms: morality, virtue, cleanness, correctness, decency, decorousness, propriety, rightness, seemliness
- Beset: to cause persistent suffering to
Synonyms: afflict, agonize, anguish, bedevil, besiege, curse, excruciate, harrow, persecute, plague, rack, torment, torture
Antonyms: comfort, console, content, quiet, solace, soothe, succor
- Scrutiny: a close look at or over someone or something in order to judge condition
Synonyms: audit, check, checkup, examination, going-over, inspection, look-see, review, scan, survey, view
Antonyms: flash, glance, glimpse, peek, peep, sight
War and peace: on Kabul’s peace proposal with the Taliban
Kabul extends a peace proposal to the Taliban. But will it be accepted?
Afghan President Ashraf Ghani’s offer of talks with the Taliban is the most comprehensive peace proposal to have come from Kabul since the U.S.-led invasion of Afghanistan in 2001. Speaking at the Kabul Process, a two-day security conference in the city with more than 20 countries including India represented, Mr. Ghani promised to recognise the Taliban as a political party, called for confidence-building measures and asked them to recognise the Kabul regime and the constitution. The Taliban was told to open an office in Kabul; passports and freedom of travel were offered to those involved in negotiations. This is not the first official attempt to make peace with the Taliban. In July 2015, Taliban and Afghan government representatives held talks in Pakistan. But the talks collapsed (सिमटना) when it emerged that Taliban leader Mullah Omar had died two years earlier. Ever since, the Taliban has stepped up its violent campaign, killing thousands. This time the difference is that the Afghan government has come up with a seven-point plan of engagement with the Taliban and invited the group for talks without preconditions (पूर्व शर्त): the previous formulation was that the Taliban should choose between war and peace. Mr. Ghani has not set any time limit for the Taliban to respond. He has said the views and proposals of the Taliban would be considered, thereby lobbing (उछाल कर फेकना) the ball into the Taliban’s court.
Mr. Ghani’s offer comes a month after U.S. President Donald Trump ruled out talks with the Taliban. The Trump administration has also committed more troops to Afghanistan. But given how much Kabul relies on the U.S. for support, it is unlikely that Mr. Ghani would have made such a significant offer to the Taliban without U.S. consent. The reason could be desperation (निराशा). After more than 16 years of war, the Afghan government is helplessly watching the Taliban spread its influence across rural areas. In the east, the Islamic State has gained ground. Over the years the U.S. had tried tactics including a troops surge (लहर), putting pressure on Pakistan to use its leverage (प्रभाव) with the Taliban and promoting secret talks. But nothing worked, and the Taliban has established a strong presence in almost two-thirds of Afghanistan, and is constantly on the offensive. It has shown a capacity to strike at the most fortified (मजबूत) positions in Kabul, but knows it cannot capture the city as long as the Americans remain committed to the government’s security. Therefore, both sides have an incentive to break the stalemate (स्थिति में अवरोध) and try direct negotiations for a way out. If the Taliban accepts Mr. Ghani’s proposal, that could set the stage for a constructive engagement between the militants and the government, and provide hope for some much-needed relief to the war-hit Afghan people.
- Collapsed: a complete depletion of energy or strength
Synonyms: burnout, exhaustion, fatigue, frazzle, lassitude, prostration, tiredness, weariness
Antonyms: refreshment, rejuvenation, rejuvenescence, revitalization
- Preconditions: A condition that must be fulfilled before other things can happen or be done.
Synonyms: prerequisite, necessary condition, obligatory condition, essential condition, condition, requirement, necessity, essential, necessary thing, imperative, stipulation, proviso
- Desperation: utter loss of hope
Synonyms: despair, despond, despondence, despondency, forlornness, hopelessness
Antonyms: hope, hopefulness, gaiety (also gayety), glee, gleefulness, jollity, joviality, lightheartedness, merriment, mirth, mirthfulness
- Surge: a moving ridge on the surface of water
Synonyms: billow, swell, wave
- Leverage: the power to direct the thinking or behavior of others usually indirectly
Synonyms: authority, clout, credit, heft, in, influence, pull, sway, weight
Antonyms: helplessness, impotence, impotency, powerlessness, weakness
- Fortified: to prepare (oneself) mentally or emotionally
Synonyms: brace, forearm, nerve, poise, psych (up), ready, steel, strengthen
Antonyms: daunt, demoralize, discourage, dishearten, dispirit, psych (out), shake, unnerve
- Stalemate: a point in a struggle where neither side is capable of winning or willing to give in
Synonyms: deadlock, gridlock, halt, impasse, logjam, standoff, standstill