We are what we are !!

 "Data Piracy is threatening Data Privacy".Information security starts with the CIA Triad-sounds more like mafia and counter-espionage jargon- is the bedrock of the cybersecurity edifice.CIA stands for Confidentiality, Integrity and Availability encompassing the entire gamut of Information security. Consider the following examples and contemplate on these real-life threats faced by all of us: 1)TWITTER SAYS 130 ACCOUNTS WERE TARGETED IN A MAJOR CYBER ATTACK OF CELEBRITY ACCOUNTS TWO DAYS AGO SOURCE: BBC 17 JULY 20 2)MARRIOTT INTERNATIONAL NOTIFIES GUESTS OF PROPERTY SYSTEM INCIDENT SOURCE: HTTPS://NEWS.MARRIOTT.COM/NEWS/2020/03/31/MARRIOTT INTERNATIONAL NOTIFIES GUESTS OF PROPERTY SYSTEM INCIDENT 3)Computers containing data relating to national security and VVIPs like Prime Minister Narendra Modi were compromised in early September after a security breach at the NIC (National Informatics Centre), Delhi Police sources have said.The computers affected also stored data relating ...

 "Negotiations over a shrinking pie are especially difficult, because they require an allocation of losses" The above is from Daniel Kahnemann's magnum opus "Thinking, Fast and Slow". India is facing a shrinking pie situation with steep GDP contraction. Fiscal stimulus is imperative and it is expected on a yesterday war footing. Early birds and head-starts enhance hope and confidence which feed favourably into demand and investment.They also act as countercyclical to shrinking pie despondency. Credit boost is a temporary remedy to manufacturing machinery to kick start and keep up the production capacity. But it can work only up to a point, where the productivity and earnings should become sufficient to keep up with the plan of repayment of loans and borrowings. If the people in general do not foresee sufficient future income and employment, they may not turn out to buy things and assets.They cannot evergreen their loans like some corporates feeding only on liqui...

  Central Govt has brought three PLI (Production Linked Incentives)schemes so far- for Electronics Manufacturing, Pharma APIs and Medical devices- in order to give a big push for Make in India as part of PM Modi's aspirational theme "Atmanirbhar India". Under PLI scheme for Electronics mfg. 4% to 6% is the incentive on incremental sales over the base year and the scheme has three sub-categories-Mobile phone (International Cos), Mobile Phones(Domestic cos) and Specified Electronic Components Mfg. The govt recently announced 16 companies under these categories which included the likes of Samsung, Apple's Contract manufacturers Foxconn Hon Hai, Wistron, Pegatron and also Rising Star. Under the Domestic companies, Lava, Micromax etc. and under Specified Electronics components, 6 companies have been approved.Over the next 5 years, this policy initiative is expected to lead to the production of over Rs.10.5 lac cr with a likely export of over Rs.6.5 lac cr out of this, as p...

  Three New Labour codes have been passed by the Indian parliament last week. Central Govt without wasting the crisis has pushed through these Industrial labour reforms. Industrial Relations Code Bill,2020; Code on Social Security Bill,2020 and Occupational Safety, Health and Working conditions Code Bill,2020. These three codes will have to be taken together with the Wages code passed in 2019 making together a grand four labour codes merging 29 Central Labour Acts. Some of these Acts like Payment of Wages Act ,Workers Compensation Act etc. belong to British times and finally, these vestiges of colonial legacy have been buried in the 21st century. This leads us to the question "Are we fully liberated from British rule?!!" In the first bill Industrial Relations Code Bill, the Central Govt. has proposed to introduce more conditions restricting the rights of the workers to strike work, and also to increase the threshold relating to layoffs and retrenchment in any industrial estab...

 Indian Central Govt. successfully pushed  3 Farm bills through both the Houses of Parliament last week. Since the ruling NDA led by BJP has a majority in the lower house i.e Lok Sabha the passage of these bills happened without any hiccup there. But when the same bills had to be passed by the higher house i.e Rajya Sabha, where NDA has a thin majority, pandemonium reigned and all hell broke loose. But the Chairman of the house went by voice vote amidst allegations that he chose to ignore the call for division of the house. Now the opposition is upset not by the farm bills per see but the way it was carried by the Chairman by the Upper house by not allowing them to stall this reform in the garb of discussions et al. Several Agricultural Commissions and Committees incl the Sen Committee and Dr.Swaminathan Comittee over the last 30 years, have strongly suggested on this unshackling of Agri markets across the country. This reform is long overdue. Even Congress Govt. wanted to imp...

  Comptroller and Auditor General of India(CAG) is the top Govt Auditor of India, who is a Constitutional authority. He Audits all the Central and State Govt related accounts and gives his report with his findings, lacunae observed in the system, along with necessary corrective measures as per the best practices around the world. In his latest report on the Income & Corporate  Tax department functioning under the Central Govt, he has given some damning statistics. People in the know feel vindicated with his report lashing at the ineptitude of the Dept in tackling the inefficiency of the tax bureaucracy. Let us look at some of his key observations:( link ) 1)Income tax arrears of demand has increased from Rs.11 lac cr.in 2017-18 to Rs.12.3 lac cr, in 2018-19. 2) Out of this Rs.12.3 lac cr. the Tax dept itself says 99% of it is non-collectible or in other words, would be difficult to recover. 3)At the CIT Appeals, which is the first forum of Appeals,the Auditor observed, the...

 Import Trade wall or barriers are not new to India. The country had very steep walls in terms of Tariffs, licensing ,quotas etc. all in the name of safeguarding the domestic industry. When the country gained independence, many of the industries were either nascent or anemic and in order to restore their health, Central Govt had no option but to erect some import restrictions so that local industries in the economy are nurtured. This grooming of domestic industry with level playing field took a new turn in the late 1960s and 1970s with widespread nationalisation of private enterprises, ushering in an era of erratic socialism all in the name of protecting the citizens from private profiteering. This concept led to erecting walls within the country between the commanding heights of Govt. undertakings and the Private enterprises. The private sector was neglected and was left to fend for itself and scaling up an enterprise became a uphill challenge for private sector. Inorder to protec...

  "All animal are equal, but some animals are more equal than others," wrote George Orwell in his allegorical novel Animal Farm. the stody in short conveys the meaning that the absolute power corrupts absolutely. His novel 1984 which is a classic dystopian novel, also wrote about Thought Police to persecute individuality and independent thinking . This novel and Aldous Huxley's "Brave New World" rank as two of the best dystopian novels of twentieth century. Huxley's novel describes a world where people are born and raised  through engineered artificial wombs and childhood indoctrination into predetermined classes or castes based on intelligence and labour. In all these novels, a world covered by intelligence which gives it an order and discipline predetermined by its rulers, is a dire prediction. Coming to Covid 19 driven world of today, our ways and methods are directed by rulers assisted by doctors, epidemiologists and virologists , and we are not at liber...

Initially, when COVID 19 started spreading in India, PM Modi announced a war on Covid 19 and every single citizen abided by his exhortation. Many newspapers and media personnel screamed Modi is going hammer and tongs at Covid 19 virus in order to scorch it totally. But after a few lockdowns, both PM and the common man understood with humility that Covid demands hammer and dance strategy to deal with it. So we are now reconciled to the fact that we must learn to live with Covid 19 at peace instead of waging a losing war. Adapting to its speed and spread, the common man is now equipped with mask, social distancing etc. to tackle it and dance with it. Govt adopts the hammer and the common man adopts dancing with it. Hopefully, this will become a considered foreign policy also with China, the birthplace of Covid19. Hammer at LAC and then dance with it in commercial and trade space!!Also, dance with China to wean it off Pakistan!!

Policy prescriptions are flying thick and fast and on my part, I am adding one more . All Economists including me are prescribing deficit monetisation, pump priming etc. taking a leaf out of Modern Monetary Theory. As against this,Central Govt. has an alternative which is called Asset monetisation, according to me.Govt calls it Disinvestment/Divestment of PSUs. When the whole world is reeling under Covid pandemic , will there be a suitor for Air India? Even if there is a good buyer will he be willing to pay the right price for Air India.What will be the benchmark for its valuation when the whole industry is bogged down by this pandemic and its repercussions on the travel industry. In such unprecedented situations , it is best advised not to go in for outright sale transactions of Government stake in PSUs including Air India, BPCL,etc. Similarly, other intangible but real assets are Spectrum waves ( link ), Mining/Abiotic  ,Biotic Resources which are hidden inside the Ear...

Sri. Krishnamurthy Subramanian, Chief Economic Advisor to Central Govt,yesterday, has gone on record saying that further demand stimulus measures will be announced after vaccine becomes available. Why should we link stimulus to vaccine availability is not clear. What kind of vaccine he is expecting and if the vaccine falls short of his expectations whether he would not allow roll out of stimulus? I t may become too late to wait till then.Why because, the common man has started saving his meagre earnings due to his fear about his future earnings and not due to Covid pandemic per se.In order to allay his fear about his employment and future earnings, Govt must sacrifice some near term revenue and announce some economic incentives  for kick starting the economy.What better place to start than with Indirect Tax cuts. Auto sector is the biggest in manufacturing in terms of GDP and reducing GST on it from 28% and converge it with Revenue Neutral Rate(RNR) of 18% will give a huge ...

If you do a SWOT analysis of India's capabilities, certainly Software prowess will be among the top in the list in terms of technological leverage. Pharma will come next to it and there are others like leather goods, cotton textiles, garments etc. There is one niche area where India has excelled in all- Research, Design and Manufacturing capabilities and that is two-wheeler production. Even though India borrowed the technology from Japanese manufacturers initially, now India has its own name in the world for 2 wheeler manufacturing competing and even outshining the best in the world. Yesterday I was listening to a panel discussion on defence manufacturing. Two out of the four panelists predicted in about 5 to 10 years time, India will be among the first three in terms of Research, Design and Mfg. of niche defense equipment incl high-end weapons built on the cutting end technology. According to them ,it has been made possible by the coherent, calibrated and painstaking efforts ...

Central Govt announced Rs.90K cr rescue package for power gencos through PFC and REC.But PRAAPTI ( Payment Ratification And Analysis in Power procurement for bringing Transparency in Invoicing of generators) website shows that the total overdue amount to be paid to Gencos stood at Rs.113.8K cr at the end of May 2020 continuously going up for the last 18 to 24 months. The total outstandings were Rs.125.6K cr. link . Apart from this, there is renewable energy generation pending to be adjusted against captive consumption of factories which is not yet visible.This may be another iceberg submerged. After clearing Rs.90K cr.as per GOI plan  stated above, how the state discoms are going to manage their future liabilities. With a negative gap between Average Cost of Supply(ACS) and Average Revenue Realised at Re.0.41 per unit on an All India basis, it is a losing game. AT & C loss is also still very high at 18.72% link .UDAY (Ujwal Discom Assurance Yojana) commitments lie in tatt...

Pl. see the below page from the Central Govt published data. link Regular IT assessments done by Dept is yielding only 7 to 8% of total Gross Direct tax collected where as Adv. Tax, TDS and SA Tax is 92% i.e the voluntary compliance . Is there not a strong case for abolishing Assts for atleast individuals who have good track record of say 10 continuous years and have limited scrutiny assessments only for Corporates/Companies with incentives for exemption from assessments if they remit Tax at least 15% more year on year.This will take care of tax buoyancy ratio and reduce assessment costs drastically. Mr.Sunil Jain of FE recently sent a tweet to FM saying that IT dept is following up with him on some assessment notice despite complying with it and paying tax. Everyone of us have similar experiences on IT assessments despite computerisation. Straightaway all these scrutiny assessments can be called " IT Harassments "-no euphemism. But it sho...

"Buy land, they're not making it anymore"-Mark Twain Govt. is in the process of identifying land parcels for attracting industries moving out of China for want of safe haven. If big land parcels can be earmarked for setting up Industrial parks and industrial clusters, it will give a huge fillip for Make in India campaign. As PM said India has the Intent, it paves way for Inclusion,  provides Infrastructure. attracts Investment and enables  Innovation. But what is stopping it from leap frogging. It is redtapism in land acquisition ,lackadaisical Court procedures and the greed of politicians that put paid to ambitions of growth in Make in India. Even smaller countries like Vietnam, Indonesia are able to attract industries moving out of China in a big way but the sleeping giant like India falters. Despite improving the ranking in Ease of Doing Business has the economy really energised itself to become an aspiring industrial giant. There are green shoots here and there...