C. P. Chandrasekhar’s Blog

At the time of writing, the 13th ministerial meet of the World Trade Organisation (WTO) is under way in Abu Dhabi. Among the many issues that are being discussed are two of concern for less developed countries generally and India in particular. The first relates to the renewal of a moratorium on imposition of trade taxes on digital services identified as “electronic transmissions”. The second concern is that of finding a permanent solution to the issue of public stockholding of food, or the legality under WTO rules of measures to procure at administratively prescribed, ‘non-market’ prices of food to be…

Indian federalism is on the verge of breakdown. Ministers from opposition-ruled States have taken to the streets in New Delhi to protest against discrimination by the Centre. And the Prime Minister, who leads the use of a divisive majoritarian agenda for political gains, has attacked the protestors saying they are breaking up the country by using the narrative of a North-South divide for political purposes. The fact is that opposition parties leading state governments are under siege. Central agencies are being used to scare and incarcerate State level opposition party leaders. Central directives and schemes are being used to undermine…

As the distance between Maldives and India widens, with the latter being asked to withdraw its uniformed personnel stationed in the former, questions are being asked about how Maldives will manage without India’s help on the economic and regional security fronts. As if echoing that sentiment, in Article IV consultation reports following the COVID pandemic year 2020, the IMF has been underlining the country’s vulnerability to external and overall debt distress. The Maldivian President Mohamed Muizzu, who won an election his party fought on an anti-India platform, appears convinced that with Chinese support he can do without India. He clearly…

Recruitment drives held over the last week of January, in Lucknow in Uttar Pradesh and Rohtak in Haryana, for Indian workers to undertake construction and caregiver jobs in Israel have captured global attention. Thousands of job aspirants, who had either registered online or just walked in for interviews, were seen as vying for 10,000 advertised positions to be filled in each of these locations. Promised a salary in excess of Rs. 1,30,000 a month plus perks varying from a small bonus to free accommodation, the applicants are willing to ignore the risks associated with migrating to a country engaged in…

On January 10, the IMF announced its decision to release $4.7 billion out of a $57 billion bailout package sanctioned in 2018 to perennially debt-distressed Argentina, then under a right-wing government headed by Mauricio Macrio. That surprised some. Going by the IMF’s stated ‘principles’, the disbursal should not have occurred because the country had failed to meet the conditions and targets specified by the lender for continuation of the programme. Besides, the $4.7 billion reflected not only the delayed release of a $3.3 billion tranche that was due last November, but also the release in advance, or ahead of schedule,…

Early in 2024, the World Bank in its flagship report Global Economic Prospects, put out a message of gloom. This year could end marking “a wretched milestone: the weakest global growth performance of any half-decade since the 1990s”. Between 2021, when the world economy showed signs of recovering from the troughs of the pandemic, and 2023, growth has been decelerating almost everywhere, with the figures at 6.2, 3.0 and 2.6 per cent for the world as a whole in 2021, 2022 and 2023 respectively (Chart 1). For most advanced economies growth in 2023 was below the average recorded during the…

The recent collapse of the protracted negotiations to restructure Zambia’s external debt, following a default in November 2020, underlines the failure of the prevailing international financial architecture to address global challenges. Not only has the structure not been adapted to the realities of a changing international order, but it binds the less developed countries into accepting the IMF as the principal agent to manage balance of payments difficulties and address debt stress, on behalf of both creditors and debtors. But the claim of the IMF to being a neutral arbitrator has long been in question. The Zambian experience suggests that…

Following the COP28 Summit, there is an attempt to establish that the conference was a significant step forward in the effort to address the causes and consequences of climate change. However, a reading of the actual outcome only illustrates how the resistance of the developed countries to own up to their historical responsibility as emitters is stalling the effort to combat climate change and manage the consequences of the changes already underway. The COP process is ostensibly concerned with the global effort to move from an unsustainable trajectory to an acceptable one in terms of the ceiling on long-term warming…

Abstract On April 12, 2022, Sri Lanka defaulted on external debt service commitments. Announcing the “pre-emptive default”, pending restructuring, the government also announced that it was suspending repayments due in 2022 on its external debt. By May, Sri Lanka was formally in default, becoming the first country in the Asia-Pacific region to default on debt in two decades. There were medium-term factors that underlay the crisis, not least of which was the chronic dependence on foreign finance, especially debt, to cover widening current account deficits that followed the IMF-inspired and dictated embrace of liberalization policies starting in the late 1970s.…

The world’s leaders and their representatives meet in Dubai in December to revisit the climate challenge. Information to facilitate those discussions is not wanting. A plethora of reports, from official and private sources, covering diverse issues have been released in the run up to the summit, which lay out the policies that must be implemented to stay within the acceptable range of global warming between 1.5 and 2°C. Indications are that discussions at Dubai would focus largely on the how far nations can and will go to phase out fossil fuels. That issue is no doubt paramount, given the disproportionate…