Elephant in the Room-General Elections, reduce GDP(Gas,Diesel,Petrol)prices to boost GDP!!!

 Elections, particularly in India, can indeed have an impact on its economy, including liquidity and inflation. During election periods, State governments of India often increase spending to buttress their election campaign and implement populist measures to attract voters. However this GOI has eschewed its temptation to loosen its purse strings. However it has increased its Capex infra projects which can generate assets and have a trickle down effect in the income of the people. But this increased government spending at State levels can potentially lead to higher liquidity in the financial system.

If the increased liquidity is not matched by an increase in productivity or economic growth, it can potentially lead to inflationary pressures. In such situations, central banks like the Reserve Bank of India (RBI) might need to adopt tight liquidity management policies to rein in inflation. Tight liquidity management involves reducing the money supply in the economy by selling government securities, increasing interest rates, or implementing other measures to absorb excess liquidity.The Reserve Bank of India (RBI) is likely to face the challenge of managing liquidity in the run-up to the 2024 general elections.

This is the Elephant in the Room of both GOI and RBI for them to deftly handle!

The RBI will need to use a variety of tools to manage liquidity, such as open market operations, repo rates, and cash reserve ratio. It will also need to closely monitor inflation and financial market conditions. If inflation starts to rise too quickly, the RBI may need to tighten monetary policy. However, this could dampen economic growth.

The RBI will need to strike a delicate balance between managing liquidity and supporting economic growth. It will also need to be mindful of the political implications of its decisions. If the RBI is seen as being too hawkish, it could alienate the government, upset favourable business conditions and jeopardize its chances of re-election.

Here are some of the specific measures that the RBI could take to manage liquidity in the run-up to the 2024 general elections:

• Increase the repo rate: This is the rate at which the RBI lends money to commercial banks. By increasing the repo rate, the RBI makes it more expensive for banks to borrow money, which reduces the amount of liquidity in the system.
• Sell government bonds in the open market: This reduces the amount of money in the system by draining it from the banking system.
• Raise the cash reserve ratio: This is the percentage of deposits that banks have to keep with the RBI. By raising the cash reserve ratio, the RBI reduces the amount of money that banks can lend out, which reduces the amount of liquidity in the system.

The RBI will need to carefully monitor the situation and adjust its policies as needed. It is a challenging task, but the RBI has a good track record of managing liquidity in the past.

On 31st August India's Q1 FY24 GDP is expected to be announced which may come at 7.9% to 8%.This high percentage may be due to subdued Q1 of FY23 revealing low base effect.Even though GST and Income Tax collection have remained buoyant in Q1 FY 24, Corporate Tax collections have languished indicating a K shaped recovery in the economy.

Considering the Inflationary effects and the likely Q1 GDP nos. Govt is expected to face a dilemma shortly. It is also the question of Short term inflation versus Long term inflation. GOI must consolidate its limited available revenue resources without upsetting its Fiscal deficit calculations ,inorder to rein in short term Inflation immediately and for that to happen Govt must look at reducing a different GDP! Yes, this is a different GDP-Gas,Diesel and Petrol- taxes levied on them must be reduced to contain Inflation in the short run inorder to give a boost to real GDP in FY 24 before Lok Sabha elections!

RCEP and India

 Regional Comprehensive Economic Partnership (RCEP) is the economic alliance formed with China and other 14 countries primarily from Asia recently but including  non Asian countreis like australia, New Zealand. India was said to have entered into this economic pact and was negotiating for its membership, but withdrew later when it rightly found that this trade partnership would only benefit other countries but not its interests.

Maybe in the long run India would have to enter this trade pact but certainly not at this time when China's hegemony is strangling many of the Asian and African countries.

With many of the other Asian countries India already has a free trade pact except China.

China is a net exporting country to India and therefore any free trade pact removing the tariff barriers would only directly and indirectly benefit China.

Let us look at the specific pros and cons to RCEP:

Pros

1)The purpose of RCEP was to make it easier for products and services,investments, intellectual property rights of each of these countries to be available across the region. Differential rights have been granted to economically less developed countries

2)this pact covers the economic powerhouses of Asia including Japan, China and South Korea covering roughly 30% of Global GDP and 30% of World's population.

3)the pact is intended to reduce redtape and also tariffs.

4)it will bring about uniform customs procedures and  rules of origin which will facilitate global supply chains and trade within the region.With less regulatory framework trade will become seamless.

Cons:

1)this does not cover labour unions, environmental concerns and sustainability,human rights and government subsidies.

2)it does not commit countries to open services and other vulnerable areas of their economies.

3)Some countries may become dumping grounds for other manufacturing countries.The pact consists of countries that are the largest exporters of the world.

4)India's trade deficit with 11 RCEP member countries has worsened post 14 RTAs(Regional Trade Agreement) already signed with them. There have not been any significant export gains for India out of the already existing 14 RTAs.

5)Tariff reduction in a calibrated manner suggested by India has not been accepted by other RCEP countries. India suggested that with ASEAN countries it will reduce tariffs by 80%,for other countries like Japan, South Korea by 65% and for other countries like China, Australia,New Zealand by 42.5%.The countries disagreed and demanded uniform relief of 90% on tariffs.

(Courtesy:Rabobank Research analysis)

6) In order to protect domestic manufacturing, India suggested auto-triggering and snapback measures which will kick in immediately if certain agreed thresholds get breached in imports from certain countries esp. China for manufacturing imports and Australia and New Zealand for dairy products and other ASEAN countries for plantation products like Rubber .

7)India is already suffering from half of its trade deficit coming from China, and post the pact its trade deficit may worsen as with other RTA countries since India is a big consumption destination with vast population.Moreover the vagueness in addressing the concerns on trade in Services sector in which india has a comparative advantage.  also left India with no option but to keep out of it for some more time.

8) Since India has launched its "Atmanirbhar Bharat", PLI schemes for giving a huge push for Make in India , India will be benefited from RCEP after its manufacturing sector makes some significant gains in the domestic market.

9)Some countries do not see political alignments with few other countries like India and China due to the ongoing geopolitical tensions.(link)

RCEP member countries have kept the door open for India and india may well take a decision to join this after a year or two lag when its domestic economy starts growing at 8-10%. India can bring strong institutional policy framework to RCEP and many countries want India to be in RCEP as a counterbalance to China's growing clout and influence.

US, India and Kamala!

 Independence day in India is always a grand event as it happens on August 15th of the year. A year has 365 days and if you have a cut off at Aug 15th ,it is 227 days into the year starting from Jan 1st..This is approx 1.66:1 of the year. That is the Golden Ratio which is supposed to be a mystic proportion of anything including the picture of Mona Lisa ,and that is considered to have made it magically beautiful.

That apart, Indian Independence day this year was preceded by the announcement of Kamala Harris as the running mate of the US democratic presidential candidate Biden.

Kamala Harris' mother was of Indian origin from Chennai. She carries the name Kamala which is a traditional Sanskrit name for Lotus flower. Indian ruling party BJP has Lotus symbol as its primary identity. The moot point is , the common least denominator between the ruling party of india and US politician Kamala ,is the Lotus . In many ways, Lotus i.e Kamal is very dear to india and it is the official flower of the country also.

From time immemorial in all the Indian Sanskrit scriptures and literature, Lotus has come to be identified with the cultural and religious sanctity.It holds a premier position in Hindu/Buddhist/Jain/Sikh religions as representative of all that is blemishless and purity. Many of the Hindu,incl. Buddhist etc. Gods or Goddesses are seen seated on the Lotus flower as it symbolizes purity in full bloom. Offering Lotus to Hindu Gods and Goddesses is believed to usher in , auspiciousness and prosperity into the lives of devotees. Even our heart is called Hridaya kamala in our literature. In higher philosophy,'Ka' is referred to as Brahman(paramatma), 'Ma' is referred to as Human(jeevatma), and 'La' is referred to as Acharya or Sri, who tirelessly work in uniting the Jeevatma with the Paramatma.

But it looks like the connection between Kamala Harris and India seems to end with Kamala and not beyond that, since the general social and political outlook of BJP and Kamal harris are totally divergent.They do not share a common platform of understanding of the fabric of Indian society, which is inherently plural and democratic. She has shared her opinion of Indian ruling class , relationships with Pak, Kashmir problems etc. seen through the prism of US and not through the prism of India. Pak and Bangladesh are offsprings of India and it is not sibling rivalry that bogs down India-Pak relationships as viewed by US generally. 

To that extent , I humbly believe, Kamala Harris will have to borrow an Indian prism to look at Indian subcontinent issues, since almost 7 countries(India, Pak, Bangladesh, Afghan,Nepal,Bhutan and SriLanka of South Asia were all part of Bharat i.e India ,till the advent of the 20th century.The cultural and religious relationships and influence of India extend beyond this to China, especially Tibet and all the South east Asian countries incl. Japan, Indonesia, Thailand, Malaysia etc.

Finally, she should not forget that India is a 70year old thriving democracy and that too the largest democracy in the world sharing many similarities with US, which Columbus thought to be India!!

Covid, Cricket and Character!

 Cricket has weathered many a winter and smothered many a vagary as a gentleman's game. Cricket was played during Spanish flu times also and UK's Wisden has not recorded any disruption in the progress of the cricket season in 1918 and 1919. But Cricket was severely restricted during World war 1 when all the major cricket playing nations were involved in the war.Cricket was also played less during World War II since England was involved in the war in full measure. But during all these periods of distress, Cricket was played in India with the least disruptions.

In fact, Wisden which has recorded death of English cricketers during World War 1 and 2 in all cricket playing nations , has not even mentioned one indian cricketer dying during Spanish flu days.This has to be seen in the light of total death toll of 17 million who died in india during Spanish flu years.

So even in 1918 and during World wars everybody around the world believed that India could somehow manage and survive humanitarian crises.

But this Covid 19 apart from being a dangerous pandemic , has also become a statistician's delight. of course not as enjoyable as cricket statistics. But still there is a everyday scorecard and the top states are vying with each other to remain on top with highest Covid 19 nos. Tracking, Tracing , Testing and Treating has given huge opportunities for multifold statistics and different tools to be employed across the country and the globe.

there are 3 day moving average, 5 day average, 7 day moving averages of tested, positive, discharged, active, deaths etc.etc. and colorful graphs of percentage growths of each one of them which compete with each other for eyeball grabs.

All the news channels have a separate ticker like in a Cricket match and hour to hour scores update pushes up your BP and make you a Covid patient , if not one already. Many people have stopped seeing news reporting in any channel and if they see one by mistake wait with bated breath,holding their chests with clenched fists as if hearing an India scorecard in a World cup cricket match.

Of course, the statisticians, epidemiologists, virologists give dire prediction every 15 days constantly reminding us that Covid nos. will surge and there will be a deluge in the next two months and this has been going on for the last 4 months.They have been predicting wildly exaggerated nos. and some statisticians can track all these predicted nos. of various agencies and give out the comparisons with the actuals. Such comparisons can provide another play with graphs, colours etc.

In all this round-robin play what is missing is character.Only few have been able to hold their forte not to rock the boat and rattle the gullible.Like lenders and banks looking for people with character to lend ,this pandemic has given a clarion call to those with character to come to the rescue. You can find people with capital, capacity to repay but finding a person with Character ,which is willingness to repay, is difficult. Character being  a rare commodity in these days of rising NPAs,  Bankers will nod their heads in agreement with me. In Cricket also we have seen people like Rahul Dravid, the Wall, VVS Lakshman, who have displayed great character to steady the ship, in crisis situations. Cricket captains like Mike Brearley of England, Pataudi and Dhoni of india, have shown stoic demeanour in the face of dire situations while leading their Teams. But a World cup winning cricket captain Imran Khan is the PM of Pakistan during this pandemic.But like in his heydays he is spitting venom at his rivals even outside the cricket arena. Is Cricket not making PM ,a gentleman? 

However,  I am not losing hope since our PM, himself, is a man who displays great Character even if he has not played cricket and is known to have sold & served Tea perhaps even during Tea breaks while others were busy playing Test Cricket!!

Be cautious and there is no need to spread fear and panic about both Covid and Economy! Drink hot Tea and take good rest!

We are born without locks!

Whenever any discussion happens on the human mental states, usually the discussion starts with Sigmund Freud. His Id, Ego and Alterego interpretations of the human mind in both conscious and subconscious levels have been the subject matter of debate throughout the world.

If you construct a matrix grid with Child, Parent and Adult ego states of Eric Berne's Transactional Analysis of social behaviours exhibited by human beings,  blended with Freud's human personality types of psycho analysis , then the two-axis grid will present what Eric Berne envisaged.

However, I went one step further and tried to blend the basic gunas as outlined by the Indian philosophy of yonder: Sattva, Rajas and Tamas. The complex matrix will be like the above.

According to me the middle axis of a combination of Ego, Parent and Rajas will give a stability to the human life and existence through the ages. It is Sattva which will primarily drive the Adult behaviour and bear on the Alterego for the soul's evolution to a higher plane of existence. Only a very few would be able to reach that level of discipline and yearning it demands.

Some of you may wonder why I titled this piece "we are born without locks!".

One young man met a yogi and asked him, if God had willed that everybody should be disciplined and strict then he could have given us locks for our senses and so since He has not sent us with locks, He wants us to remain free and enjoy the life as per our wishes. Yogi with a smile replied saying that He has set us free with a free Will trusting us against misuse and abuse.! that is the beauty of the whole game.

We create our own game and our own rules, and we are allowed to play with all our senses in our command. We are free to choose our methods, ways of creating excitement, enjoyment and merrimaking to our hearts' contentment. But your methods and ways pave way for your own future to unfold for you. Your means justify the ends. If You tread on others' toes to play this game, you may invite somebody to tread on your toes as a reaction and the game continues that way.You let others play and enjoy the game with you, somebody will also allow you to play and enjoy. So, this way the game goes on and on and on.

It is all about how you try to improve your fair play in the game. When your Sattivic nature gains upper hand , you are out of the line of Ego taking over and you are constantly trying to up your fairplay. Yogis play it the minimalist way.

It is all without locks and keys!!All in the game!

Calendar, vaccination ,algebra etc. and India's contribution acknowledged ?

Antikythera mechanism and modern computer.

Many scientists who have worked on studying Greek's antikythera mechanism which was found in a shipwreck in early twentieth century, to be precise 1901, is considered as the world's first analogue computer..

This was used to predict the astronomical events, transits, eclipses and other planetary positions well ahead of their occurences and used for astrological purposes even decades in advance.

There are some confusions as to whether it used Greek astronomy, Egypt astronomy or Rhodes' astronomy where Archimedes lived. The twelve months given in that machine carry the Greek names but has equivalent Egyptian names also. The research on this first computer has not yet concluded, even though the machine itself has disintegrated over a period of time from the time it was discovered under the sea.

But in India from time immemorial , astronomy has been studied by great sages and used for astrological purposes. The Hindu priest class developed an almanac listing all the planetary positions including eclipses etc. with great accuracy and their effects on human lives as part of Jyotisha i.e Astrology.

I have with great amusement found that the Gregorian calendar(1582 ACE) correspond with the seven days given in ancient hindu astronomical texts and some of the  12 months are taken in their Sanskrit names. Sunday in India correspond to  Bhanuvara, Monday is Somavara etc. Thirugnanasambandar of 8th century ACE, in his Kolarupathikam also mentions the same order Sun, Moon, Mars etc. which has been imported into the Gregorian calendar order of weekdays.(link)This link's gives an idea of how week days have evolved scientifically/methodically in India.

The months of September (Sapthama), October(Astama), November (Navama), December (Dasama) were originally the 7th, 8th, 9th and 10th months and when Julius Caesar and Augustus added their names , these months became 9th, 10th, 11th and 12th months in Gregorian calendar.

As an Indian even though I know that these month names are Sanskrit, many western scholars say that these are Latin names and some say both Latin and Sanskrit are from a common Proto Indo-European group and the jury is still out.

The time system used today based on 60 minutes for an hour is also from India. Indian time system is always based on 60s. A day is divided into 60 ghatis and one ghati has 60 vinadis/vighatis and one vighati has 60 liptas etc. Even India has a system of cycle of 60 years at the longer end. There may be more to look at multiples of 60 to understand the time cycle methods used in India.

There are many such words like Geometry is Jamiti in Sanskrit, Tigonometry is Trikonamiti in S, smart is samarth in S etc. to name a few.

One small additional info with regard to Vaccination for small pox. Today I read from a book link "Pharmacology: Drug Actions and Reactions, Seventh Edition by R.R. Levine, C.T. Walsh, Rochelle D. Schwartz-Bloom" clearly says in Page 3 that Dhanwantri in his writings clearly mentions about vaccination for small pox.

In their analysis "Smallpox and Vaccinia-Donald A. Henderson and Bernard Moss" (Chapter 6) it is clearly mentioned that vaccination for smallpox was developed by Indians before 1000 AD and this went from India to China, Arabia etc.link

From the book of another British physician Dr. Ainslie on Small-Pox and Inoculation in Eastern Countries (pages 66-67)link , I am giving his exact quote verbatim "To substantiate the fact that the inoculation of the " cow-pox was known in remote times to the Vaidyas, it is only necessary " to refer to the Sacteya Grantha, attributed to Dhanwantari, and there " fore undoubtedly an ancient composition. In one part of the work, after " describing nine several kinds of small-pox, of which three (one alabi, " being the confluent) are declared incurable, the author proceeds to lay " down the rules for the practice of inoculation. From this part the following " two excerpts are made; of the first of which the original is given in the " English character, and with it a literal translation: of the second the original is not given, but merely the translation.

Excerpt First, from the Sacteya Grantha. " D'henu stanya ma' suchiva naranancha, ma suchica, " Tajjalam bahu mulachcha sastrantena gnhitavan, " Bahu mule cha sastrani ract'otpatti cariini cha, " Tajjalam racta militam sphotaca jwara sambhavah." Translation of the above. " Take the fluid of the cow-pox on the udder of a cow, or on the arm " between the shoulder and the elbow of a human subject, on the point of " a lancet, and lance with it the arms between the shoulder and elbow " until the blood appears; then mixing the fluid with the blood, the fever " of the small-pox will be produced.". Excerpt Second, the Sanscrit Text being omitted. " The small-pox produced from the udder of a cow will be of the same " gentle nature as the original disease, not attended by fever nor requiring " medicine. The diet may be according to the pleasure of the patient, " who may be inoculated once only, or two, three, four, five, or six " times. The pock, when perfect, should be of a good colour, filled with " a clear liquid, and surrounded with a circle of red. There will then be " no fear of the small-pox so long as life endures. When inoculated from " the udder of a cowr, some will have a slight fever for one day, or two " or three days, and with this there will sometimes be a slight degree of " cold fit; the fever will also be attended by a round swelling in the arm " pit and the other symptoms of the small-pox, but all of a very mild " nature. There will be no danger, and the whole will disappear. (Signed) " Calvi Virambam." " Madras, January 2d, 1819."

Many Chinese doctors in 19th and 20th century have also mentioned that this procedure might have gone from India to China, to Arabia and to Europe. But not all western scholars still do not believe or subscribe to this view.Many of them still say that either this could have gone from China or from Arabia to India and not the other way around!!

Finally one word about Al-Khwarizmi of Persia(from whose name the word " Algorithm" is derived),who has been credited as the founder of Algebra. What he started writing was" kitab al-jam' wa'l-tafriq al-ḥisāb al-hindī ('Addition and subtraction in Indian arithmetic')", actually learning it from India and he acknowledged it, but Western world is still not convinced ,even after Brahmagupta's phenomenal work became known.

Has Ramanujam's contribution to modern maths and even to Banking(?)(ATM machines) been fully acknowledged. Experts can inform me about this.

Only Voltaire clearly said "  I am convinced that everything has come down to us from the banks of the Ganges, – astronomy, astrology, metempsychosis, etc... It is very important to note that some 2,500 years ago at the least Pythagoras went from Samos to the Ganges to learn geometry...But he would certainly not have undertaken such a strange journey had the reputation of the Indians' science not been long established in Europe."

Let me rest my case!

Bacteriophages, Ganges and MIT on fasting.

In 1896, Ernest Hanbury Hankin, a British Bacteriologist, Chemist, came out with a finding that the Indian rivers, Ganges and Jamuna could actually restrict the outbreak of cholera and in fact the waters could destroy the Cholera bacteria. He was the first to detect the bacteriophage activity and its presence in the river waters of Ganges and Jamuna. A startling discovery when the whole world was saying the river waters of Ganges were the most polluted.link. In his own words
"It is seen that the unboiled water of the Ganges kills the cholera germ in less than 3 hours. The same water, when boiled, does not have the same effect. On the other hand, well water is a good medium for this microbe, whether boiled or filtered."

This was mentioned even by Mark Twain in his More Tramps Abroad.

Recently microbiology researchers from Chandigarh's Institute of Microbial Technology (IMTECH), studied the healing properties of Ganges water at its upper reaches and found bacteriophage activity which destroys the disease causing bacteria. The bacteriophage is a type of virus that eats up bacteria.link.

Recently MIT came up with a study on fasting by humans and its beneficial impact on human health.link "Fasting boosts stem cell regenerative capacity"- the MIT article says,

"As people age, their intestinal stem cells begin to lose their ability to regenerate. These stem cells are the source for all new intestinal cells, so this decline can make it more difficult to recover from gastrointestinal infections or other conditions that affect the intestine.

This age-related loss of stem cell function can be reversed by a 24-hour fast, according to a new study from MIT biologists. The researchers found that fasting dramatically improves stem cells’ ability to regenerate, in both aged and young mice."

Indians practice this 24-hour fasting once in 15 days on the Ekadasi day from time immemorial.

The human body is an intelligent machine with recuperative and regenerative capacity and given the right metabolic switch , it can mend itself when disease strikes.

All the Siddhars of India emphasized that "உணவே மருந்து"(Food is medicine) when taken in the right quantity at the right time intervals. Thiruvalluvar has also emphasized this in his kural chapter "மருந்து". 

India is a land possessing all the keys to the world's problems, if only you explored.