C. P. Chandrasekhar’s Blog

Recent trends in the organisational form of units in the registered manufacturing sector suggest that India’s factory sector is not just abnormal but backward to boot. Lopsided_Industrialisation  (Download the full text in PDF format) (This article was originally posted in the Business Line on May 8, 2017)

Despite the government's efforts to digitise the Indian economy forcibly, non-cash forms of payment appear to have declined as more currency has been made available to the public. This points to major flaws in the government's coercive approach and the underlying rationale for cashlessness. De_Digitisation_India  (Download the full text in PDF format) (This article was originally published in the Business Line on April 24, 2017.)

After four decades of financial reform China’s banking sector is still dominated by publicly owned institutions. But continuity in ownership does not mean that banking behaviour does not change. Chinese_Banking (Download the full text in PDF format) (This article was originally published in the Business Line on April 10, 2017)

No discussion of South Korea’s dramatic transition from a poor underdeveloped country to a developed country member of the OECD club of rich nations can ignore the role of the chaebols—its ‘clans of wealth’. Consisting of a large number of legally independent firms controlled by a single family dominated-decision making centre (very much like India business groups), these Korean conglomerates grew rapidly during the regime of General Park Chung-hee (1961-1979), and today the top 10 of them earn revenues that are equivalent in value to around 80 per cent of the country’s GDP. For long credited as having implemented the…

An analysis of India's ICT performance suggests that software export success tends to hide both imbalances in production and their adverse balance of payments fall-out. ICT  (Download the full text in PDF format) (This article was originally published in the Business Line on March 13, 2017)

The crisis created by non-performing assets (NPAs) on the balance sheets of commercial banks, especially public sector (PSBs), does not go away. It only intensifies. An environment that triggered large inflows of foreign capital and a surge in credit after 2003 encouraged banks to explore new areas and terms of lending, which are responsible for the large exposures that are now turning bad. Having encouraged that environment with its policies, the government had been pretending that the problem is not serious enough to warrant emergency action. The reason was that it wanted to do the impossible: resolve a big problem…

Even for those sceptical about the government’s declared policy intentions—varying from cleaning the Ganga to doubling farmers’ incomes by 2022—the subdued and insubstantial Budget 2017-18 was a surprise. The circumstances in which the Budget was presented were exceptional. In the midst of a slowdown in growth with signs of the onset of deflation[i], the government had chosen to withdraw and declare worthless more than 80 per cent of the value of currency in circulation by demonetising “higher value” notes. But new notes to replace the ones withdrawn were slow in coming and had to be rationed, because the indefensible measure…

Although divorce rates are low in India, separation is the dominant form of marital dissolution, and this is especially problematic for women because of the uncertain legal status and lack of rights. Marital_Breakdown_India  (Download the full text in PDF format) (This article was originally published in the Business Line on February 27, 2017)  

In an insipid speech that was repeatedly misread, Finance Minister Arun Jaitley presented on 1 February the contours of a budget that was shockingly short of substance. It left disappointed those who expected that policies to compensate sections hurt by the demonetisation experiment would be included and those who were looking for some measures to counter the demand slump afflicting the economy that had been aggravated by the demonetisation. It also surprised those who thought that the budget would be forced to expand aggregate expenditure and social spending to win voter support in the elections to the five assembly elections…