Thursday, January 30, 2020

My pre-budget interview in Manorama Malayala

 (Translated from the English version below)

1.  Regarding the slowdown, govt is continuing in the denial mode. What is your assessment about the present situation?

The situation is extremely grim. The January release from the National Statistics Office (NSO) on the advanced estimates of national income suggest a real GDP growth rate of 4.9% for 2019-20, falling from 6.8% in 2018-19, and continuing a downward slide that started in 2016-17. This is the lowest growth rate since 2008-09, the year of the global financial crisis. The nominal GDP growth rate is even more alarming. At 7.5%, it is the lowest since 1978.  As nominal GDP is national income at current prices, it is what matters for tax revenue collection. No wonder the budgetary arithmetic has become very hard with tax revenue collections not only falling short of target but also in absolute terms compared to the previous year (something that has not happened in two decades).

2. How soon can a revival happen? 

That is a matter of speculation – for a country of India’s size and resilience the economy will revive but it is hard to say how soon. With the latest quarterly GDP figures that were released, we now have had six successive quarters when the annual growth rate relative to the same quarter one year ago has been lower than the previous one. If this trend continues next quarter, this would be the longest sequence of dips in the growth rate in successive quarters for the entire period for which quarterly GDP data are available on the RBI website (1996-97). But relaxation of some external constraint could start the revival process sooner rather than later, such as lower oil prices or slowing down of food price inflation or influx of foreign investment due to changes in the global economy.

3. What are the structural reforms needed on the macro and sector-specific sides?

At this moment the biggest priority is a stable policy environment with no further adventurism like we saw with demonetisation and the manner of GST implementation. The controversial NRC and CAA proposals have not helped. Leaving aside the political debate around it, just from a narrow economic point of view, the government should not keep on demanding more and more paperwork and imposing more and more regulations and laws that create an atmosphere of anxiety for citizens, businesses, and corporations. Economic growth in the end must have a foundation of optimism and positive outlook. By definition, investment is a forward-looking activity and even consumption stagnates when people are worried about the future and feel they need to tighten their belts - and creating more bureaucracy and more regulations and an atmosphere of political unrest do not help in this regard. In the medium term, a whole slew of reforms is needed in land, labour and capital (or banking sector) markets as well as the public sector, all geared towards reviving investment and generating employment. The protectionist measures that are being talked about are counter-productive – we need to focus on reviving export demand and not think in terms of providing any further protection to our already heavily protected industries in the name of import substitution.

4. What are your expectations from the budget?

In terms of things to expect from the budget, the fiscal space for doing much is limited given that the central government's budget deficit is likely to be 3.7%-3.8% of GDP, breaching the 3.3% target up to the maximal level of leeway of 0.5 percentage points that exists. If we add the deficits of the central and state governments (another 3%) and consider off-budget borrowing, the overall deficit stands at 8% of GDP.  The exact numbers not being clear, it is difficult to say if a fiscal expansion is feasible, but if there was ever a moment to worry less about inflation targets and focus on reviving aggregate demand, this is it.  At the very least the government has a choice to decide what not to cut or cut less. My sincere hope is that expenditures such as rural infrastructure, MGNREGS, PM Kisan, maternity benefits, pensions, etc. that benefit the majority of the population, whose average consumption levels have fallen according to the NSS expenditure survey that was not officially approved, are not cut.  I am not supportive of the personal income tax cuts or corporate tax cuts that many are proposing. After all, personal income tax revenues constitute around 2.5% of GDP and corporate income taxes around 3.3%, with the rest coming from indirect taxes. Given that those who pay these taxes have a higher saving rate, being more affluent than the average citizen, the demand boost from this is likely to be limited. The government could cut the GST rates to the extent some of the benefits of the lower tax burden on business goes back to consumers in the form of lower prices.  

Sunday, January 19, 2020

My maternal grandfather, Shyamal Chakrabarty

Yesterday (January 18, 2020) was my maternal grandfather Shyamal Chakrabarty’s birth centenary. He was born this day in 1920 and passed away in 1975 when I was only seven.
I still remember him vividly. He was one person who never said no to anything I asked for, though being a somewhat serious kid, I usually asked for books. To be honest, there were times my mother spotted him awkwardly waiting at the door of our ancestral house in Bhowanipore in the early afternoon, apparently waiting for a particular ice-cream vendor with his cart to show up since I had vaguely expressed appreciation for ice-creams of a particular variety.
On his mother’s side he was a direct descendant of Iswarchandra Vidyasagar – his maternal grandmother Sarajubala Devi, was the daughter of Binodini Devi, Vidyasagar’s third daughter. He would, of course, never mention this and I found out about this bit of family history much later from my mother. I did get to spend quite a bit of time in my childhood with Dadu’s mother Ushamoyee Devi (called her Thakuma, following my mother), who was an exceedingly kind and affectionate person. Dadu’s father Urukramdas Chakrabarty was an advocate in Calcutta High Court, having earlier taught Physics in Scottish Church College for some time. He passed away before my mother was married but the house in Bhowanipore in South Calcutta I grew up in was built by him - his unusual name on the nameplate was a perpetual source of curiosity and amusement to visitors.
Dadu studied in Mitra Institution, Bhowanipore, where among his classmates and friends were the poet Subhash Mukhopadhyay and the singer Hemanta Mukhopadhyay. In 1937 he joined Presidency College and graduated with a BA degree in Economics in 1939. I would do the same exactly fifty years later. His contemporaries, such as Uma Sehanobis, a family friend, would remark that she remembers Dadu wearing a dhoti and kurta and with gold-rimmed glasses, cutting quite an attractive figure. While a Masters student at Calcutta University he joined the Communist Party of India (CPI) in 1940, of which he remained a lifelong member.
After doing his Master’s in Calcutta University Dadu was a whole-time party member for a while, and then joined the Economics faculty of Vidyasagar College for Women in 1958, a post he held until his sudden and unexpected death in 1975 in East Berlin, which he was visiting as part of an Indian delegation on education policy.
He wrote several books on education policy in India, housing conditions in Calcutta, a small monograph on Vidyasagar that was published by NCERT, and essays in various magazines and journals, including Parichay and Ekkhon. He was active in the WBCUTA (West Bengal College and University Teacher’s Association) and a founder-member of Neerokkhorota Dureekoron Samiti (Society for Eliminating Illiteracy).
These are things that were later told to me and my brother Saran by our mother Lipi, his only child. I just remember his warmth and how his face lit up when I came to visit. Also, his living room always had many visitors and I would impatiently wait for them to leave so that I could monopolize his attention. When the news of his death reached Calcutta, I am told that his colleagues in Vidyasagar College, both teaching and non-teaching staff, and mostly women, were in tears. He was a heart patient. With modern drugs that are available now, he would have lived much longer. Throughout my life I have met countless people, both men and women, from a wide range of social and cultural backgrounds, and cutting across political lines, whose face would light up instantly when they figured out I was Shyamal/Shyamal-da/Shyamal-babu's grandson.
I sometimes imagine talking to him. He would not have liked to see the fate of the political system he believed in or the state of disarray the left political movement is in. I suspect we would not fully agree on the causes and consequences of these events, but I would like to think that in terms of a vision of a fair and inclusive society, we would not differ very much.
Mostly though I think of a large living room in a house that no longer exists on Priyanath Mallick Road, Calcutta with bookshelves all around and a middle-aged man, not much older than me now, sitting and writing in his desk, who seems delighted to be interrupted by a solemn-faced little boy who has just woken up from his afternoon nap.

Wednesday, December 4, 2019

Bob Willis, R.I.P.

There are a few ageing sports celebrities I sometimes see as co-passengers in the strike-prone but otherwise perfectly good South Western Railways, the overground train service I take to go from Barnes, a neighbourhood in southwest London I have been living in for more than fiteen years, to Waterloo Station in central London, on my way to work.
One of them, Bob Willis, the legendary fast bowler, passed away today. He looked like an academic or a writer except for his giant stature, and was always reading a book. But even at an advanced age his physical appearance evoked glimpses of the brutal beauty of his long run up, the curly hair, the pale grey eyes, and the fearsome leap before he released the ball....
I never tried to talk to him the few times we were in the same compartment. He would typically be immeresed in his world, and I felt that he deserved to be left alone. Once there was a brief eye contact and I bowed slightly in recognition and respect, and he gave me a faint but indulgent smile back.
In a Tweet the actor and his friend Stephen Fry says: “Oh no, not Bob Willis ... what joy he gave, and what a marvellous man. That 8 for 43. Used to lunch with him occasionally to talk cricket, Wagner, and Bob Dylan, his three great passions.”
What a unique combination of interests! Yet, somehow it seems to make sense. 

Monday, September 23, 2019

The magician is no more.

Today, when the centre of the sun is directly above the equator, and the night starts getting longer in the Northern hemisphere, a shadow has fallen that will mark this day forever for me, and everything will be a little less bright, a little less sparkling, a little less warm. My high school mathematics teacher and "guru" in the truest sense of the word, Pinaki Mitra passed away today in Kolkata. I woke up and heard the news from Anikda, to be followed by messages from other friends from Patha Bhavan: SudeshnaIndraneelPinaki. I was lucky to have him as a teacher and so did many others. He was one of a kind.
I don't believe in afterlife or souls resting in peace, nor did Pinaki-da. But for me there will always be the memory of a room in Picnic Gardens, Kolkata where magic happened with ingredients as mundane as cups of tea, bangalipi notebooks, leaky pens, and the dry and drab pages of Higher Secondary mathematics and statistics textbooks....Newton and Leibniz would come to life, to be suddenly interrupted by Russell, John Von Neumann would curtly interject, Wittgenstein would speak softly, and Joseph Conrad or George Orwell would mutter some devastating words of wisdom about the absurd cruelties of life, like waking up to such news. That magician is no more.
Below is a tribute I wrote to him a few years ago in The Readers Digest (…/story-my-most-unforgettab…)
I first met Pinaki-da on a rainy July afternoon in 1984 when I started high school. In his mid-40s then, he was short, had a salt-and-pepper beard, wore thick glasses and spoke in a perpetually excited, high-pitched voice. Pinaki-da also had the most disarming, innocent smile. While students would refer to him as Professor Calculus and mimicked him, even the most hard-boiled ones treated him with affection and respect, since he clearly lived in a world of his own and was viewed as being generally affable, if eccentric.
Even when a student gave a horrendously incorrect answer or showed a truly alarming level of ignorance, Pinaki-da would never use a harsh word. He would look genuinely worried and a bit sad, as the house physician would if you were diagnosed with an illness. You almost felt the urge to do better just to cheer Sir up a bit! This brilliant man, who could solve complicated problems in a second, would not correct a vegetable seller for doing the maths wrong and over-charging him because he felt shy, according to our seniors.
Pinaki Mitra, Pinaki-da to us, was our mathematics and statistics teacher in Patha Bhavan High School, in the Calcutta of yore. He, in fact, was the most influential teacher I have ever had. And I have been lucky enough to have some great teachers in college, as well as at the two universities I attended for my master's and PhD degrees in economics -- Presidency College, Kolkata; Delhi School of Economics and Harvard University. Some of them are well-known scholars, such as my PhD supervisor and teacher Eric S. Maskin who went on to win the Nobel Prize in economics in 2007. They all influenced me in important ways. When I say that Pinaki-da was the most influential, I mean he had the biggest impact on my future trajectory and steered me in the direction that turned out to be my true calling.
Pinaki-da taught mathematics and statistics from a conceptual point of view, a far cry from the prevailing style of instruction, largely teaching techniques for problem-solving with an eye to examinations. Not only that, he would always tell us about the historical background of a particular concept or method. For example, how Newton, who independently co-invented calculus with Leibniz, was driven by the goal of coming up with a scientific description of the behaviour of moving objects for which classical geometry was inadequate.
I had taken mathematics and statistics somewhat half-heartedly in high school, to keep some options open, after deciding not to pursue the hard sciences and the medical/engineering route. My real love was literature then. At the same time, my nascent left-liberal political leaning drove me to try and understand the root causes of the poverty and inequality that surrounded our otherwise comfortable middle-class lives. My parents had told me that economics was the right subject for me. However, it required the knowledge of mathematics and statistics, and so I took them up with some trepidation, having no real liking for mathematics.
Then, on a rainy afternoon, in an ordinary school building, a converted large residential house in south Calcutta, lightning struck. Pinaki-da was teaching us the concept of limit in calculus. After having talked about real numbers, he explained how mathematicians approached the concept of infinity. As a little boy, I had often wondered if the universe had a boundary and if it did, what was on the other side? Suddenly, a lot of these concepts were beginning to make sense. As Pinaki-da would say, if you divide something by zero, you get infinity, and there is no such thing as infinity! It is merely a symbol, an equivalent of a word for expressing something arbitrarily large. In one blow a lot of the metaphysical clouds in my head cleared and I began to appreciate the austerity and beauty of the language of mathematics.
After limit came continuity, derivatives and integration while in statistics we discussed probability. I was transported to a magical world: Everything seemed mysterious and attractive, and it seemed that the wisdom of earlier generations were all distilled and waiting to be grasped by us. Then, there was no looking back. After all these years, I can still feel that heady sensation after understanding some particularly subtle concept from Pinaki-da, only to realize later that there were more layers of mystery to it. Near, yet far. Like limit and continuity.
Pinaki-da introduced us not just to mathematics and statistics, but also to philosophy, literature and linguistics. We learnt about the works of Noam Chomsky, Bertrand Russell, Ludwig Wittgenstein and John von Neumann, among many others, in informal conversations with him. Often, he would connect mathematics with the arts in a surprising way. I still remember how he suddenly started talking about the last scene of the famous Satyajit Ray film Charulata, where the hands of the protagonists, the estranged couple, Bhupati and Charu, approach each other but end in a freeze shot, suggesting a permanent fracture in their relationship, despite their efforts to come close. The way the hands approached each other, according to Pinaki-da, was like the concept of limit -- a variable approaching a real number -- and the way the scene freezes without them meeting, suggested discontinuity. We were left speechless, in appreciation of the aesthetic beauty of both art and mathematics!
By the time I graduated from high school, I was 'converted'. No matter what I studied, I knew mathematics would be a part of it. Also, I wanted to do research. The question was whether I would pursue mathematics or statistics as my main subject in college, or economics. At this point Pinaki-da and I had a conversation, similar to a heart-to-heart I recently had with Disha, my high school-going daughter.
We were talking about how to go about choosing a subject for college. Each subject is fascinating in its own way because the world is a fascinating place, I told her, and there was no objective way to rank them. Nor should one be guided only by practical considerations such as job prospects -- life is too short and there is nothing more painful than being stuck with something you don't really like, even if it pays you well. The most important thing was to enjoy the journey and relish the challenges that come as part of the adventure. Ask yourself, I told my daughter, what kind of thoughts and questions linger in your mind that may have nothing to do with your textbooks or what people around you are discussing. These questions will lead you to the subject that is likely to suit you the most.
Thirty years ago, Pinaki-da asked me exactly this: He wanted me to think about the questions uppermost in my mind. I realized that I loved the beauty of mathematics while literature remained my first love, but what gripped my mind was the glaring inequality and poverty around us. I wanted to see if I could contribute to understanding how economies work and what kind of policies would make things better. Even though at that stage I was not able to connect these concerns with the way economics was presented in textbooks or taught in class. It was only during my master's degree that I finally developed a passion for the subject that was comparable to what I felt for mathematics and statistics earlier. That has never gone away and yes, in the end, I did make the right choice.
It is a rare gift to have someone like Pinaki-da as a teacher and mentor. He was a mathematician by training who topped the university examinations from Presidency College, an Ishan scholar -- the overall topper in the humanities and mathematics at Calcutta University -- and a junior research fellow in the Economics department for some time. He had ample opportunities to go abroad for a research career but was constrained by family responsibilities. He never complained, saying he liked the freedom to read whatever he wanted to, which would not be possible in a more structured environment. It is a quirk of fate that he ended up in Patha Bhavan and a testimony to the school leadership's values -- the pursuit of knowledge and creativity above examination results and material success.
I was lucky to know him. Pinaki-da not only had a brilliant mind but could transmit his passion for knowledge and understanding in a way that life was never the same for me again. I came to see hidden mysteries in everything and scholars as adventurers looking for solutions. He inculcated a sense of intellectual cosmopolitanism in us -- he was much influenced by the philosophy of Bertrand Russell and was skeptical of dogma of any kind, religious or otherwise.
When I spoke to Pinaki-da on the phone recently, I asked him what occupied his mind these days. He was fascinated by the writings of Haruki Murakami and was reading a lot of literature in general. What about the political and economic controversies of the day? Absolute truth exists only in mathematics and logic, where two plus two always equals four, he said. Society, however, evolves in such a way that no political ideology, no belief system can provide a formula for a perfect world: "There is no ideal society. It is like the concept of limit in mathematics." At that moment I felt that there were some constants in life, at least. Thank goodness for that, and thank you Pinaki-da for being such a tremendous influence on my life.

Tuesday, May 1, 2018

Ashok Mitra - End of an Era

Ashok Mitra passed away today. I met him a few times, given his proximity to my paternal grandmother's side of the family (especially, her elder brother, Sachin Chaudhuri, the founder-editor of EPW) but didn't know him well.
I remember him giving a guest lecture at Presidency College when I was a second-year undergraduate student. I still remember how unassuming he was despite his obvious fame and stature, and being impressed with his ability to quote statistics from memory. Of course he was very critical of mainstream economics but to be fair, there were grounds for being so.
We are all familiar with his opinionated columns in English and Bengali. Whatever one's political views (and, in all honesty, I disagreed a lot more than I agreed with his political opinions - from the left and the right depending on the issue and the evolution of my own thinking) there is no doubt Dr Mitra was one of the last great bilingual intellectuals of post-Independence Bengal - equally fluent and powerful in English and Bengali.
I loved his biographical sketches of various political and cultural personalities, his autobiographical writings, and especially his writings on poetry and writers (and completely shared his admiration for Samar Sen and Buddhadeb Basu).
His voice will be missed. And I will keep reading and re-reading some of his writings.

Thursday, April 12, 2018

Sorry, Asifa

It is difficult to keep the face of a certain eight year old girl and her gaze off the head in the middle of all the newswaves that continuously hit our radar. 

One can argue that posting on such gruesome events when there is nothing more to say other than express sadness and outrage is pointless. Indeed, given that social media appears to have become a platform for collective venting without much consequence beyond that, one can argue that it is perhaps better to channel our energies, money, and effort to help organisations and individuals who work to prevent such things from happening, or to provide help to victims and their families when they do.

In the end human depravity has no bounds - such events have happened in the past, and unfortunately will continue to happen. Outrage will not stop them. The only recourse is law enforcement - those who commit heinous acts must suffer the consequences whether that is a deterrent or not. 

I don't think any right-thinking person can disagree with any of this. The trouble is, when such events happen in the context of a political and religious conflict, what should be simple does not stay simple. Some people are making comments like "let's keep religion out of it" or "why politicise it?" 

Hard as it might be to imagine, there are in fact such apologist narratives dripping with defensiveness and whataboutery, and not just by trolls. 

See, for example:

I am sorry, but there is an organisation that is defending the accused called Hindu Ekta Manch. And two ministers from the ruling party attended the rally (who have since had to resign with the news hitting the national and international headlines).

Given this, it is disingenuous to deny the political and religious angle to it. 

Sorry, Asifa. You deserved a better world...even in your death. 

P.S. And yet there are some rays of hope in the heart of darkness. The leading investigating police officer and the lawyer representing the victim's family both are Kashmiri Pandits.

As one has to continuously remind oneself, it is wrong to lose hope, or one's faith in humanity.  

Wednesday, March 14, 2018

Economic Growth in India and the Gandhi-Nehrus - Update

"Why is it that during the years that your family ruled India, India's per capita income was growing less than the world average? And yet, in the years since your family relinquished the prime ministership of India, India's per capita income has grown substantially faster than the world average?" 

This statement, by a participant in an event in Singapore addressed at Rahul Gandhi happens to be factually incorrect. However, the participant, who describes himself as an author, has now shifted the goalpost to assert that he meant India’s per capita income grew less than the world average for 1947-89. This is well-known and sits uncomfortably with the original assertion given that both the World Bank and Angus Maddison data-sets show that if you consider the years a Gandhi or a Nehru was a PM, it is not the case that the growth rate of India was lower than the world. In a recent Op-Ed I did the exercise with the World Bank data-set:

Repeating the exercise with the Maddison data-set that has a longer time horizon going back to 1950 yields the same conclusion. 

A scholar or a researcher who is serious about facts (and I am not at all concerned with formal degrees or qualifications) would acknowledge that the original statement was not correct as stated and suggest a reformulation that can be backed up empirically. But instead we have a self-congratulatory op-ed in the Swarajya

The long and meandering account repeats basic facts that are well-known, repeats ad nauseam why the Gandhi-Nehru family is to blame for everything, but provides no evidence in support of the original statement. And as one would expect, unable to objectively back up his claim he resorts to political name-calling of those who have pointed out the error - for example, referring to me as "Congress’ thinkers (like Maitreesh Ghatak)"  without a shred of evidence to support the connection (a reference that has since been removed by the Swarajya editorial department). 

For the record, I am a left-leaning liberal who does not identity with any specific political party.  As a liberal I oppose any form of authoritarianism, including the ones in the current or former socialist countries. Being liberal means I place the importance of civil/democratic/human rights above everything else and cherish social inclusiveness. I am left-leaning in the sense of being progressive and placing poverty-eradication to be the main objective of economic policy. At the same time, I am economically pragmatic and support private enterprise (including non-profits) while acknowledging the necessity of a public sector to do what private enterprise cannot or would not do. My political biases are based on issues, not partisanship. Any party that upholds some or all of these values will have my support.  

Everyone is entitled to their opinions. Everyone (including me) have their political biases. Facts are another matter.  They are objective and can be independently verified. How you interpret them is subjective. Scholars and researchers can tell the difference.

As I said to one of several who disagree with me but engage in a civil manner in Twitter about facts and logic (a genuinely positive aspect of the platform) debating is like football. You want your "side" to win, but fairly. You need good opponents to raise your game. And, no team can or should win forever - not good for the game. 

And about this gentleman's partisan leaning? Just look at the profiles of his Twitter followers or the slant of the television channels where he seems proud to have appeared. Why is it that the most partisan are the first to charge others of being partisan? 

Here are the links to the World Bank and the Maddison series for those who want to check it