Category Archives: South Asia – Republic Of India

Storyline: India slumps into worse economy recession ever

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The shutdown in the vast country of 1.3 billion people left huge numbers of people jobless almost overnight, including tens of millions of migrant workers in the shadow economy.

India’s economy contracted 7.5 percent between July and September, performing the poorest among major advanced and emerging economies and entering a technical recession for the first time since independence, official data showed Friday.

Although the figures were an improvement on the record 23.9-percent contraction recorded last quarter, they indicate that Asia’s third-largest economy is in for a tough fight as it attempts to revive demand and create jobs even as coronavirus infections climb.

The two successive quarters of contraction mean that the country has now entered a “technical recession” for the first time since 1947.

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After virus-led lockdowns ravaged the globe, the growth recorded by major economies including the United States, Japan and Germany during the quarter ending on September 30 raised expectations that India would also enjoy a revival.

But, while consumer businesses saw a boost due to increased spending in the run-up to the October-November festive season, hopes of a broader recovery were dashed, with the construction and hospitality sectors taking a hit.

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Farming continued to be a relatively bright spot, while manufacturing activity also increased during the July-September period after plunging nearly 40 percent during the previous quarter due to the lockdown.

New Delhi has struggled to kick-start an economy that is expected to shrink 9.5 percent this year, according to estimates released by India’s central bank governor Shaktikanta Das last month.

The International Monetary Fund has meanwhile predicted that India’s economy would contract by 10.3 percent this year, the biggest slump for any major emerging economy and the worst since independence.

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A report by Oxford Economics released earlier this month said that India would be the worst-affected economy even after the pandemic eases, stating that annual output would be 12 percent below pre-virus levels through 2025.

India’s economy had struggled to gain traction even before the pandemic, and the hit to global activity from the virus and one of the world’s strictest lockdowns combined to deal the country a severe blow.

The government has since been easing restrictions to revive activity, announcing two stimulus packages to offer farmers easier access to credit and dole out benefits to small-scale businesses.

The relaxation measures have been deployed even as the coronavirus continues to ravage the country, which has registered more than 9.3 million infections — second only to the United States — and over 135,000 deaths.

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In a speech Thursday, central bank governor Das warned that the recent surge in virus cases and the imminent threat of new lockdowns posed further risks to the economy.

“We need to be watchful about the sustainability of demand after the festivals and a possible reassessment of market expectations surrounding the vaccine,” Das said.

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#Newsworthy

COVID-19: India becomes second most hit country in World.

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Indian health ministry reports another daily record of 90,802 COVID-19 cases raising total to over 27 million worldwide.

  • India’s health ministry reported another daily record of 90,802 cases on Monday, bringing the total to over 4.2 million and overtaking Brazil to become the second-hardest-hit country.
  • COVID-19 cases are rising in 22 of the states in the US, according to a Reuters analysis, as the country celebrates its end-of-summer Labor Day weekend.
  • The world’s coronavirus cases have hit 27 million, more than 18 million people have recovered and more than 882,000 have died, according to Johns Hopkins University.
  • At least 200 UN staff have been diagnosed with COVID-19 in Syria, according to a leaked document, as the organisation steps up efforts to contain the spread of the disease in the war-torn country.

#Newsworthy…

COVID-19: Tension rise in India as cases top 4 million.

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With record surge in daily infections, India is set to overtake Brazil as the second worst-hit nation in the world.

India became the third country to cross four million coronavirus cases on Saturday, also setting a new global record for a daily surge in infections and closing in on Brazil’s total as the second-highest in the world.

The 86,432 cases added in the past 24 hours pushed India’s total to 4,023,179.

Brazil has confirmed 4,091,801 infections while the United States has 6,200,186 people infected, according to Johns Hopkins University.

India’s health ministry on Saturday also reported 1,089 deaths for a total of 69,561.

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Initially, the virus ravaged India’s sprawling and often densely populated cities. It has since stretched to almost every state in India, spreading through villages and smaller cities where access to healthcare is crippled.

With a population of nearly 1.4 billion people, India’s massive caseload does not surprise experts. The country’s delayed response to the virus forced the government to implement a harsh lockdown in late March. For more than two months, the economy remained shuttered, buying time for the underfunded healthcare system to prepare for the worst.

But with the economic cost of the restrictions rising, authorities saw no choice but to reopen activities.

Most of India’s cases are in western Maharashtra state and the four southern states of Tamil Nadu, Andhra Pradesh, Telangana and Karnataka.

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‘Worst is yet to come’
In rural Maharashtra, the worst-affected state with 863,062 cases and 25,964 deaths, doctors said measures like wearing masks and washing hands had now largely been abandoned.

“There is a behavioural fatigue now setting in,” said Dr SP Kalantri, the director of a hospital in the village of Sevagram.

He said the past few weeks had driven home the point that the virus had moved from India’s cities to its villages.

“The worst is yet to come,” said Kalantri. “There is no light at the end of the tunnel.”

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Even as testing in India has increased to more than a million a day, a growing reliance on screening for antigens or viral proteins is creating more problems.

These tests are cheaper and yield faster results but are not as accurate. The danger is that the tests may falsely clear many who are infected with COVID-19.

In Uttar Pradesh, India’s most populous state with a limited healthcare system, the situation is already grim. With a total 253,175 cases and 3,762 deaths, the heartland state is staring at an inevitable surge and with a shortage of hospital beds and other health infrastructure.

Sujata Prakash, a nurse in the state’s capital, Lucknow, has recently tested positive for the coronavirus. But the hospital ward where she worked diligently refused her admission because there were no empty beds. She waited for more than 24 hours outside the surgical ward, sitting on patients’ chairs, before she was allotted one.

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“The government can shower flower petals on the hospitals in the name of corona warriors, but can’t the administration provide a bed when the same warrior needs one?” said Prakash’s husband, Vivek Kumar.

Others have not been so lucky.

When journalist Amrit Mohan Dubey fell sick this week, his friends called the local administration for an ambulance. It arrived two hours late and by the time Dubey was taken to hospital, he died.

“Had the ambulance reached in time, we could have saved Amrit,” said Zafar Irshad, a colleague of the journalist.


#Newsworthy…

India panel grills Facebook over anti-muslim posts

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Social media giant faces scrutiny after media reports revealed it ignored anti-Muslim hate speech by BJP leaders.


An Indian parliamentary committee has grilled Facebook representatives after the social media giant was accused of bias and not acting against anti-Muslim posts on its platform.

The closed-door hearing on Wednesday followed accusations in newspaper reports that the social media giant was allowing hate speech on its platform and that its top policy official in India had shown favouritism towards Prime Minister Narendra Modi’s Bharatiya Janata Party (BJP).

The social media giant has denied the allegations and the outcome of the hearing was unclear.

Facebook came under scrutiny after a series of reports by the United States-based Wall Street Journal (WSJ) showed the company ignored anti-Muslim hate speeches by BJP leaders while Facebook’s India policy chief, Ankhi Das, made decisions favouring Modi.

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On Tuesday, New Delhi-based English daily the Indian Express reported that following a request from the party, Facebook removed pages critical of the BJP months before the 2019 general elections.

In email exchanges reported by the Express, the BJP had told Facebook the pages were “in violation of expected standards”, with posts that were “not in line with facts”.

Requests for comment from Media (known to Noble Reporters Media) to Facebook went unanswered.

India is Facebook’s biggest market with more than 300 million users while the company’s messaging app, WhatsApp, boasts 400 million users in the world’s second-most populous nation.

The BJP spends more than any political party in India on Facebook advertisements.

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Dozens of Muslims have been lynched in the past six years by vigilantes, with many of the incidents triggered by fake news regarding cow slaughter or smuggling shared on WhatsApp.

The WSJ had reported last month that Das refused to apply the company’s hate speech policies to BJP politicians and other “Hindu nationalist individuals and groups”.

Facebook allowed anti-Muslim posts on its platform to avoid ruining the company’s relationship with the BJP, the WSJ said. Time Magazine made similar allegations last week.

Das last month apologised to Muslim staff for sharing a post that dubbed Muslims in India a “degenerate community”, according to a report by US media outlet BuzzFeed News.

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Opposition attacks Facebook
The Facebook deposition was originally slated for Tuesday but was deferred following the death of former Indian President Pranab Mukherjee.

The opposition Congress party said in a statement on Tuesday that there was a “blasphemous nexus between the BJP and Facebook”.

“The aim of the BJP is ‘divide and rule’ and the social media giant Facebook is helping them achieve this,” it said in the statement.

Opposition parliamentarian Derek O’ Brien, in a letter sent to Facebook CEO Mark Zuckerberg on Tuesday, also said there was “enough material in the public domain, including memos of senior facebook management (in India)” to show bias favouring the BJP.

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Meanwhile, senior BJP leader and India’s communications minister Ravi Shankar Prasad claimed in a letter he sent to Zuckerberg that ahead of the 2019 national elections, “there was a concerted effort by Facebook … to not just delete pages or substantially reduce their reach but also offer no recourse or right of appeal to affected people who are supportive of right-of-centre ideology”.

Facebook has more than 328 million users in India, its largest audience globally [Nasir Kachroo/NurPhoto/Getty Images]

Prasad also alleged in the letter that recent press reports were the result of “selective leaks … to portray an alternate reality”.

“This interference in India’s political process through gossip, whispers and innuendo is condemnable,” Prasad said.

Ajit Mohan, Facebook’s India chief, has defended the company’s actions and denied any bias. But the company also admitted it had to do better on tackling hate speech.

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Right-wing bias?
Facebook’s alleged favouritism towards India’s Hindu nationalists is not the first time the social media giant has been accused of tacitly supporting right-wing groups.

Last year, campaign group Avaaz said that the tech giant was failing to rein in a “tsunami” of hate posts inflaming ethnic tensions in India’s northeast state of Assam.

Avaaz said the dehumanising language – often targeting India’s Bengali Muslims – was similar to that used on Facebook about Myanmar’s mainly Muslim Rohingya before an army crackdown and ethnic violence forced 700,000 Rohingya to flee in 2017 to Bangladesh.

The platform has also come under fire in Myanmar over hate speech directed against the Rohingya over the past decade.

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Investigators from the United Nations said Facebook played a key role in spreading hate speech that fuelled the violence.

The company admitted two years ago that it had been “too slow” to address the problem.

Also last month in the US, a Facebook engineer was reportedly fired for internal posts revealing that right-leaning groups and individuals in the US were given preferential treatment by preventing their posts from being removed, despite violating content rules.

Far-right news website Breitbart, non-profit group PragerU and Trump supporters Diamond and Silk, were some of the organisations and personalities favoured by Facebook, according to internal posts seen by Buzzfeed.

SOURCE: NOBLE REPORTERS MEDIA, NEWS AGENCIES


#Newsworthy…

COVID-19: India quarterly growth jumps by 23.9%

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Steep drop in Asia’s third-largest economy in June-ended quarter reflected impact of a months-long nationwide shutdown.


India’s economy shrank by 23.9 percent between April and June, the worst contraction on record since New Delhi started publishing quarterly statistics, government data showed on Monday.

The steep dip in Asia’s third-largest economy in the June-ended quarter reflected the impact of a months-long nationwide shutdown that saw most industrial and manufacturing activity grind to a halt.

The coronavirus lockdown is largely to blame. India has reported more than 3.5 million cases of COVID-19 – third behind only the United States and Brazil.

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Continuing restrictions on transport, educational institutions and restaurants – and weekly lockdowns in some states – have hit manufacturing, services and retail sales, while keeping millions of workers out of jobs.

Shilan Shah, India economist at Capital Economics, Singapore, said in a note on Friday the economic damage caused by pandemic-related lockdowns was much worse in India than any other country in Asia.

A rickshaw puller wearing a face mask waits for passengers amid the spread of coronavirus in New Delhi, India [File: Adnan Abidi/Reuters]

“Timely indicators show that the post-lockdown recovery is now stalling, underscoring the long and difficult road ahead for India’s economy,” said Shah.

Some private economists said the fiscal year that began in April could see a contraction of nearly 10 percent, the worst performance since India won independence from British colonial rule in 1947.

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Prime Minister Narendra Modi’s government announced a $266bn stimulus package in May, including credit guarantees on bank loans and free food grains to poor people, but consumer demand and manufacturing are yet to recover.

The Reserve Bank of India has reduced the benchmark repo rate – the rate at which it lends money to commercial banks – by a total of 115 basis points since February and kept rates on hold in August amid rising inflation.

Policymakers said federal and state governments are unable to increase spending, following a more than 40 percent fall in tax receipts in the June quarter.

However, following normal monsoon rains the farm sector, which accounts for 15 percent of economic output, may give hope that rural economy will be able to support millions of migrant workers, who returned to their villages from the cities when the lockdown began.

SOURCE: Noble Reporters Media, News Agencies


#Newsworthy…

COVID-19: India economic growth slumps amid lockdown.

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India’s economic growth suffered a historic 23.9 percent decline between April and June, official figures showed Monday, as manufacturing and productivity were battered by a strict coronavirus lockdown.

The contraction was the biggest since New Delhi started publishing quarterly statistics in 1996, and the latest figures came as the country’s coronavirus cases surged past the 3.6 million mark.

The steep dip in Asia’s third-largest economy reflected the impact of a months-long nationwide shutdown that saw most industrial and manufacturing activity grind to a halt.

The virus restrictions dealt a severe blow to an economy that was already struggling with a protracted slowdown through 2019, hit by the twin shocks of shrinking consumer demand and rising unemployment levels.

The decline was worse than expected, with a survey of economists by Bloomberg earlier predicting a contraction of 18 percent.

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On Monday the government warned that the figures could be revised further since the pandemic had also affected the ability to collect accurate data on economic activity.

“The entire quarter was spent in lockdown and it was a complete washout for the Indian economy,” Mumbai-based economist Ashutosh Datar told AFP.

He added that the clouds of gloom were unlikely to lift “for the next few quarters”.

“We started publishing quarterly growth figures only from 1996 and this is the worst quarterly performance on record ever since,” he said.

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The sudden shutdown from late March prompted a huge exodus by millions of migrant workers who fled cities for their villages due to a lack of food and money.

Many have yet to return even as restrictions have eased, leaving factories struggling with labour shortages.

Bleak outlook
“This is a health crisis that has metamorphosed into an economic crisis,” State Bank of Baroda chief economist Sameer Narang told AFP.

“Manufacturing, trade, construction, transport and communication have all suffered.”

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Prime Minister Narendra Modi had announced a $266 billion package — 10 percent of the country’s GDP — to revive the battered economy, while India’s central bank has slashed interest rates and transferred billions of rupees in annual dividends to the government.

But the measures have yet to yield any positive economic impact or spur a pick-up in demand, while inflation has jumped to over six percent — far above the bank’s target range of four percent.

Rising inflation and unemployment have sharply hit demand, analysts said, underlining the need for the government to act quickly to jumpstart the economy.

“We have ample reasons to be pessimistic about demand as there is a huge… job and income loss so demand will not (return) rapidly,” said Sujan Hajra, a Mumbai-based economist with Anand Rathi securities.

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“The Modi government has to come forward with some form of fiscal stimulus urgently to help economic recovery.”

Meanwhile, coronavirus infections have hit new records across the country. India on Monday reached almost 65,000 virus deaths, overtaking Mexico as the world’s third-highest fatality toll behind the United States and Brazil.

The nation of 1.3 billion also has the third-highest number of infections worldwide.

The lockdown has failed to contain the spread of the disease which has travelled from crowded cities to remote villages where access to healthcare remains a huge issue.


#Newsworthy…