Below the line

With Cabinet expansion, many of the Central Ministries have got additional Ministers of State. These Ministers, however, are normally not invited for Cabinet meetings. But this does not mean they cannot be part of media briefings called after Cabinet meetings and addressed by the Information of Broadcasting Minister along with the Cabinet Minister concerned.

Last Wednesday, the Cabinet took a decision on education, and the Education Minister, his three deputies and the I&B Minister accompanied by his Minister of State arrived for the briefing. In all, eight people, including the Additional Secretary and Principal Director General of PIB were on the stage.

Of these eight, only two spoke while the PIB official conducted the briefing. As for the media, there were 20 or 25 of them. Later, a government official quipped, when junior ministers are not part of Cabinet deliberations what is the need for them to be on the stage.

If there has been one immediate beneficiary of the Modi Government’s move to abolish retro tax from the statute book, it is the shareholders of Cairn Energy Plc. On Friday, the shares of Cairn Energy surged 6.12 per cent in London to close at £168.20, up £9.70 over the previous day’s close of £158.50. This prompted a canny market observer to point out that the gains made in market cap by Cairn Energy shareholders on Friday may have been more than what the company would otherwise get as tax refund if it were to go through the process set by the Indian government.

While the Indian stock market may not have cheered the government’s move to abolish retro tax, the market in the UK gave it a thumbs up.

Chief Economic Advisor Krishnamurthy Subramanian has made a humble request to senior officials at SEBI and the citizenry. As the main architect of the Economic Survey , Subramanian wants them to read the Survey carefully and use the latest evidence presented there to drive thinking on economic matters.

He was referring to a senior SEBI official saying at an industry e-conclave that the government with its ₹12-lakh crore borrowing was clearly crowding out the corporate bond market, which was seeing annual issuance of about ₹8-lakh crore.

You may wonder why the CEA got perturbed about this. Well, actually it goes like this — the Economic Survey had this year provided evidence on the crowding-out versus crowding-in phenomenon. It showed that in India there is no evidence of fiscal spending actually creating crowding-out.

“It maybe a tempting argument to make (that govt fiscal spending was creating crowding out), but data does not support it,” Subramanian noted. Can’t agree with the CEA more — most people don’t realise that savings are procyclical with growth. Maybe a masterclass from the CEA would help policymakers as well as the citizenry on this front.

A hapless Kerala may have replaced the test positivity rate (TPR) — erstwhile benchmark to decide on which areas to come down hard with total lockdown — with the weekly infection population ratio (WIPR) in the revised Covid containment strategy. But only just! According to detractors, the rate of hospitalisation should alone matter.

After all, vaccination can make a lot of difference here. Chance of infections in vaccinated individuals remains significant, but only a few, if at all, land in hospitals. So, two localities can have the same number of infections but have varying degree of severity of disease. And WIPR misses the mark where it matters, aver the detractors. There must be a way to adjust for the rates of vaccination in a locality with the WIPR to obtain meaningful trends, they aver.

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