Jayati Ghosh’s Blog

As India faces the biggest economic crisis since Independence, it is being led by a central government in denial about the severity of the impact on lives and livelihoods, and spreading false hopes about the immediate future. The Monthly Economic Report of the Union Finance Ministry claims that already the economy “is witnessing a sharp V-shaped recovery” suggesting that nothing drastic needs to be done by the government to return to a stable and positive economic growth trajectory. This may just be yet an exercise in perception management that the current government excels in, but it presents a misleading picture…

Now it is official: India has managed to become the global leader in the number of new daily cases of COVID-19 and the worst performing of all major economies during the pandemic so far. How did we manage this double feat? Not through ‘acts of god’, but because of the incompetence and apathy of our current leadership. Data on the decline The estimated 24% GDP contraction in April-June 2020 compared to the previous year is the worst performance among G20 economies, and even compared to other South Asian countries. But these numbers are likely underestimates because they are based on…

It’s truly a delight for me to be able to address the UNCTAD-YSI Summer School. This is not only because these are two groups that I have huge respect for and sympathy with. It’s also because the theme of this Summer School is something very close to my heart, something I and some of my colleagues have been grappling with for decades. It’s really quite energising to realise that there are so many young people willing to engage in this project. So I am going to treat this as an opportunity for me to think through some of the concerns…

Now that India has already overtaken Brazil among countries with the most number of Covid-19 positive cases and is on the verge of even beating the USA, it’s worth trying to understand what has led to this inability to control the pandemic in India. One of the arguments often made is that India, being a developing country with a large poor population engaged in informal work, the standard containment measures are less likely to work. The state also has fewer resources, both financial and real (in terms of health infrastructure and health workers), to combat the disease. All this is…

In February, 12-year-old Jamlo Makdam left her home in the Indian state of Chhattisgarh to work as a farm labourer in the chilli fields of Telangana, earning 200 rupees (about £2) a day. But on the morning of 23 March, she – along with hundreds of million others across the country – suddenly discovered that they were not allowed to work. The Prime Minister, Narendra Modi, had announced India’s draconian lockdown the previous evening, stopping all economic activity, even all movement, with just four hours’ notice. No public transport, no people allowed on roads, no shops or workplaces open; and…

The most destructive effects of Covid-19 in India have not been the result of the disease, but the nature of the government response. The most stringent lockdown in the world destroyed the economy and forced millions into poverty and hunger, but did not control virus transmission. The resurgence of disease as restrictions were lifted and the continued economic distress point to ten major features of state response that ensured these unfortunate outcomes. For full article Click here (This article was originally published in the Journal of Industrial and Business Economics which was published on line on 11 July 2020)

There has been much discussion about how external debt concerns are likely to weigh heavily on developing countries in their attempts at economic recovery in the wake of the Covid-19 pandemic. Most of this discussion has centred on emerging markets in Latin America and developing countries in Africa, some of which are already experiencing severe problems of debt servicing. Argentina and Ecuador are both currently trying to restructure some of their external debt; other countries (particularly in Africa) are also seeking debt relief and some have benefited from moratoria on interest payments. There appears to be less concern about external…

It is generally recognised that the Indian economy was already in a steep slowdown well before the Covid-19 pandemic and badly planned lockdown further destroyed economic activity. But what is possibly not so well understood that that a major reason for the recent slowdown was not just government inaction (or acts of omission) but specific policy actions (or acts of commission) that actually worsened the problem. Essentially, the Indian government contributed to the economic slowdown by significantly reducing its public expenditure at a time when spending by other segments of the economy (households and enterprises) was already slowing or declining.…

One of the most vocal critics of neoliberalism in general and the socioeconomic policies of India’s BJP-led Central government in particular, eminent economist Jayati Ghosh is known for her sharp and lucid views on social issues. In a conversation with Number13, Prof. Ghosh talks about India’s response to the Covid-19 pandemic and its myriad impacts on society. Edited excerpts: N13: How will Covid-19 impact the global economy? JG: First of all, we don’t even know what post-Covid is, because at the moment, it’s all very unclear as to how long and how widespread this pandemic will be. What is very…

While everyone was busy looking at the Covid-19 numbers across the world, other “stuff was happening” in international trade: the US-China trade war, which started as far back July 2018, just got significantly worse. This on-again-off-again war has been a feature of the Trump Presidency, with the man who became president of the US in January 2017 vowing to prevent the US from being “exploited” by other countries, notably China, that had benefited from the US market by running bilateral trade surpluses. Trump focussed on the US aggregate surplus as well as certain bilateral surpluses, missing the basic point that…