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Renu Kohli

Articles By Renu Kohli

123 Articles

Inflation outlook turns more uncertain

Producer price jump a past replay, with demand making a critical difference

It is like believing the cobra has been defanged; it can now play to the snake charmer’s tune. Will it?

Funding Recovery: Govt must urgently reform subsidies to create fiscal space

Subsidy reforms can no longer be postponed. On food subsidies, Govt can either streamline beneficiary eligibility/numbers or revise issue prices, or have a mix

NaBFID–One more infrastructure-finance institution takes wing

Its sources of finance raise some concerns; also, it shouldn’t turn out to be another source of perennial leakage successfully blocked two decades back

The government conceives massive scale-up in infrastructure investment—Rs 111 trillion spread out to FY26, against which NaBFID’s capital of Rs 200 billion and leverage to Rs 3 trillion is grossly inadequate.

The return of fiscal dominance will test inflation targeting

Testing time may unfold as fiscal dominance returns with vengeance, global trends reverse

. One hopes though it will let the FIT regime continue unchanged as this hasn’t been sufficiently tested—neither over varied business cycles nor against challenging shocks.

Rethinking fiscal benchmarks

There hasn’t been enough debate on reframing the FRBM Act against the backdrop of the Covid-19 pandemic

Inflation is by far the most important variable in this equation.

Economic Outlook: Will capital flows reverse in 2021?

A surprise inflation outburst may force rich-world central banks to shrink accommodation

These developments have propelled yield-hunting global capital into emerging markets (EMs) in the last two months of 2020.

Monetary policy fails to stimulate the economy

Subdued credit growth is a bigger concern than rising inflation. Time for the MPC to shed light on this inability to revitalise demand

It said that the food inflation stood at 7.48 per cent in November as against 8.21 per cent in the previous month. Food inflation was at 9.87 per cent in the year-ago period.

Economic recovery: Sharp contraction in financial flows last year shows exceptional stress

Recently published data on financial flows to the commercial sector confirms why growth sank to the depths it did last year—financing from all segments saw a breath-taking slide that is unprecedented!

Is India trapped in a macro trilemma?

Increased protectionism Could be a contributing factor, besides monetary fiscal imbalances, pushing the stabilisation burden on to the Exchange rates

"Any shortfall in the maintenance of the 50 per cent LTV occurring on account of movement in the share prices shall be made good within seven working days," the RBI said.

Has food inflation fallen back to old price dynamics?

Public discourse often discussed if the low retail food inflation observed until about a year ago was cyclical or structural.

Views in support of supply-side constraints underlying food inflation abound.

Covid crisis: Why India needs to worry about its services economy

The fall is understated, or the slowdown more pronounced, because PADO includes ‘other services’ not covered elsewhere.

The reasons for the weakness in services, although the PMI may be an incomplete or a narrow measure of the whole sector, are not hard to identify.

Looming crisis: Why pre-Covid consumption slide quite worrying

Household deleveraging is the new hotspot for policy attention, RBI may have to consider a deeper interest rate cut in order to restore confidence

Financial liabilities of households reduced Rs 1.5 trillion in FY20 over the previous year, a 1 percentage point decline relative to aggregate output.

India’s potential growth rate had fallen precipitously before COVID-19

India’s potential growth rate had fallen precipitously before Covid-19. It will now be pushed down further.

Crisis Conundrum: To spend or not to spend

Drawing parallels with 2008 is misplaced; fast action needed now that a downgrade has happened

This removes the fears, if any, about the consequences of larger fiscal intervention towards income support than the 0.8% of GDP considered so far.

Covid-19: An economic mess is staring in the face

Deeper contraction in output and sustained inflationary pressures could be policymakers’ nightmare

Similarly, as per the data, food inflation stood at 5.88 per cent against 6.56 per cent in the previous month and 5.21 per cent in May 2019.

Covid crisis: Why panic labour reforms can be counterproductive

In its urgency to bring in foreign investments to encourage future growth and employment, govt must remember that timing is as critical as the content of reforms

Structural reform policies endeavour to change the working of an economy in a more fundamental way, which India requires.

How precarious are state finances?

India has to sustain growth momentum ahead, public investment will have to fill up an even larger deficit in private spending than it does now.

Fighting Coronavirus: Monetary-fiscal distancing as important

Emerging economies cannot emulate monetary actions of advanced countries. Direct funding of deficit undermines discipline, central bank autonomy.

coronavirus, coronavirus outbreak, coronavirus lockdown, coronavirus lockdown in India, coronavirus lockdown economic impacts india, coronavirus economic impacts expert opinion, indian economy expert opinion

Monetary-fiscal distancing as important

Emerging economies cannot emulate monetary actions of advanced countries. Direct funding of deficit undermines discipline, central bank autonomy.

Corona-crisis needs urgent fiscal intervention

The government must work on a credible fiscal consolidation strategy once crisis settles. For now, fiscal support must be spent such that it can be credibly redeemed

Corona crisis, fiscal interventions, Corona lockdown, coronavirus, economic activity, financial sector, gdp, coronavirus pandemic

In corona fight, mind the debt

Fiscal risks intensifying from build-up of liabilities. It would be prudent to fund targeted hand-outs to corona-affected segments by redirecting subsidy spends

Could inflation be the biggest surprise in 2020?

With macroeconomic policy inconsistencies building up, inflation risks could turn out to be real and surprise all in 2020.

inflation, economy

Budget 2020: Nirmala Sitharaman’s great escape on fiscal deficit

Budget 2020-21: For now, the government has managed to ‘escape’; it anticipates that structural reforms will revive growth, and investments, with help from monetary easing, and a possible pick up of global growth

India could be staring at a low-level growth trap! Must get real on infra-led growth

India’s past does not inspire confidence. If the TOT model fails and insolvency creeps into NHAI, pfc, etc, India could be staring at a low-level growth trap.

economy, india economy

Exceptional 2019: The year in which all growth projections for economy went haywire

The fault lines of the economy that had opened up much before the election became deeper and widened in the second half of the year.

The heightened vulnerabilities in the financial sector in 2019, for example, are an outcome of the problem-handling over the last few years.

Economic slowdown: The return of inflation fears

Atypical dynamics of high inflation and weakening demand, with other growth drivers fizzling out, could close the monetary space available TO the MPC

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Investor anxiety: Private investment in the doldrums

Difficult to gauge if it will survive the recent demand shock, The severity of the demand fall has depressed sentiments.

Private investment, GDP, IMF, RERA, NPA, NBFC crisis, Policy Uncertainty index, investment slowdown
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