Time to strike the gavel

Dushyant Dave | Senior advocate of Supreme Court | The Hindu

Dave writes the most damaging Supreme Court judgment was the one delivered on 28 April 1976 by a five-member Constitution Bench, which allowed for suspension of the writ of habeas corpus during Emergency”. This anti-constitutional and anti-people” judgment had a deep impact as it suspended the right to life and liberty granted under Article 21.

Today, even without declaring Emergency, basic constitutional rights have been suspended in Jammu and Kashmir, and SC is not challenging this.

In response to a writ petition filed, challenging the lockdown in Kashmir, the Attorney General said law and order had to be maintained. Another writ petition filed to lift the communication blackout was responded to similarly.

The top court accepted these responses, but its responsibility is to ascertain true facts”.

The SC’s approach to former union minister P. Chidambaram has also been questionable. Thus, the judiciary needs to prove that it is still the pillar created to protect constitutional and legal rights”, writes Dave.

The seduction of data sovereignty in India

Nayantara Ranganathan | Programme Manager, the Internet Democracy Project | Hindustan Times

Union Minister of Railways and Commerce Piyush Goyal, in the G20 meeting in Japan recently, spoke about data being a sovereign asset”. But the government’s approach to sovereignty simply replaces foreign companies with Indian companies, while the dangers of extractivism” remains the same, writes Ranganathan. We will be unable to resist data colonisation” if India still buys into the Silicon Valley narrative” that data is an objective truth-teller”. Data Sovereignty will become a way to trade individual rights with hopes for higher GDP figure and greater State control”.

Two examples of this are draft e‑commerce policy and the Personal Data Protection Bill. The Bill proposes a horizontal data localisation requirement”, which means copies of personal data will be stored in the country allowing for consolidated access to data for government surveillance.

The e‑commerce policy, on the other hand, proposes a separate category of community data”, which conflates data belonging to individuals to that of the State, and ignores conflicting interests.

The government needs to instead create alternative frameworks of sovereignty, and take positive actions like enforcing strong encryption policies and adopt open-source software in governance functions, says the author.

What the data tells us

Ali Mehdi | Leads Health Policy Initiative at ICRIER | The Times of India

Prime Minister Narendra Modi’s Independence Day speech about population control”, the Population Control Bill 2019, and Union minister Giriraj Singh indication that one community” was to blame for rising population — all imply that Muslims are causing India’s population explosion. But demographic data tells a different story, writes Mehdi.

India is headed to be the most populous country in the world by 2027, according to UN World Population Prospects 2019. But Muslim contribution to our population growth is very small, 16.7 per cent in 1971 – 2011, compared to that of Hindus at 77.4 per cent. Muslim population’s growth rate has actually been declining since 1971.

Population change is determined by fertility, mortality and migration rates, but socio-economic factors like education, wages are also responsible.

Fertility has, however, declined by 40.8 per cent among Muslims and 35.7 per cent among Hindus between 1992 – 93. Around 21 per cent Hindus and 25.4 per cent Muslims were Below The Poverty line in 2011-12 — this is more worrisome and needs to be addressed in order to stop population explosion.

Asian cats, Western monkeys

Sanjaya Baru | Distinguished Fellow, Institute for Defence Studies and Analysis, New Delhi | The Indian Express

Baru recounts a Panchatantra tale about a clever monkey and quarrelling cats” to make an analogy with the quarrels between Japan and Korea, India and China, and Pakistan and India. This quarrelling Asians” narrative could be the end of the Rising Asia” narrative, says Baru.

Questions have arisen about the US’s geo-economic containment” in China. Baru notes that major Asian countries have a global responsibility, and no one power can dominate the continent.

But India’s real challenge is its slowdown in growth, which could threaten livelihoods, not merely lifestyles”. China’s slowdown is also troubling, he writes.

Restoration of global growth depends on Asia’s revival. Looking towards the West will be unhelpful as Europe lacks vision and the US is actively engaged in disrupting global growth”. Thus, Asian leaders have a huge responsibility and Asia’s future needs to be decided in the next meeting between PM Modi and Chinese President Xi Jinping.

Bank of England governor may have an unlikely ally in Trump

V. Anantha Nageswaran | Dean of IFMR Graduate School of Business, Krea University | Mint

Nageswaran mentions a recent speech made by Mark Carney, the Bank of England governor, in which he labelled the dollar as a burden for emerging economies.

Nageswaran also argues that the world economy, even five decades after the end of the Bretton Woods system of exchange rates, still operates on a dollar standard. He writes that for all practical purposes, there is one exchange rate (the dollar exchange rate), one monetary policy, one economy and one financial market”. He writes when the Fed Reserve cuts interest rates, other countries follow. When Fed Reserve raises interest rates, other central banks also sell dollar reserves and raise interest rates. Bond and stock returns globally are also correlated with US stocks and bonds.

Nageswaran writes that Trump, in his bid for re-election, has been attacking the Fed chairperson for having raised interest rates”. He writes that Trump’s approach may lead to a loss of confidence in US dollar and that would be the first step to the multipolar world that Carney wants”.

Difficult to sync lending rates with repo rate

Madan Sabnavis | Chief Economist, CARE ratings | Financial Express

Sabnavis makes a case against the argument that banks should lower their deposit and lending rates after an RBI rate cut. He writes that even though the repo rate has decreased by 110 bps in the last one year, it hasn’t changed the lending rates much. He argues that banks are cautious here as lowering deposit rates in general will affect the supply of funds”. He points out that lending rates are not coming down because deposit rates aren’t and also because the effective rate for customers may not come down if credit risk perception is higher”. He argues that in a slowdown with corporate sales growing very slowly, this risk needs to be priced in while lending.

He also writes that while the RBI rate cuts have brought down the cost of borrowing for the government, the corporate bond market hasn’t shown similar behaviour. The corporate bond spread over government securities has in fact increased indicating higher risk perception on commercial lending. He, therefore, argues that presently the market doesn’t support lowering of deposit and lending rates.

India’s Visibility Issues

Anjana Menon | CEO, Content Pixies | Economic Times

Menon argues if India wants to attract investors to boost its economic growth, then it must focus on information transparency. She cites an IMF paper, which argues that there is clear evidence that international funds invest systematically less in less transparent countries”, to corroborate her argument.

Providing instances of lack of transparency, she mentions that the July 5 Union Budget lost some shine after India’s former chief statistician pointed to a Rs 1.7 lakh crore hole in earnings”. Similarly, she writes that a member of the Prime Minister’s Economic Advisory Council wrote that the Budget speech glaringly failed to mention the country’s fiscal situation”. She worries about the recent steps to limit the access of journalists to finance ministry in this regard.

She concludes by saying that credible information, even if it is uncomfortable and unpopular, might make all the difference between investors trusting India or fleeing the country”.

Originally published in ThePrint.