China lockdown

The public protest against lockdown in China is understandable. People across the world (including China) do not want any more lockdowns as they affect their freedom and livelihood. As the saying goes, “Necessity knows no law”.

The father of modern macroeconomics, John Maynard Keynes, stressed on the importance of increase in aggregate demand to achieve economic growth.

He went to the extent of saying that aggregate supply can be increased to any extent to match the aggregate demand, as idle human resources are ever there to be absorbed. Unemployment and under-employment are as serious a malady as the pandemic.

Needless to say, the global supply chain is also affected by imbalances in the Chinese economy.

S Ramakrishnasayee

Chennai

Growth drivers

This refers to ‘Q2 GDP growth good, but bottlenecks are evident’ (December 1). The data released by the National Statistical Office (NSO) has shown India’s economy grew at 6.3 percent in the second quarter of the current fiscal. How the economy fares in the upcoming quarters hinges upon both domestic and global factors.

The global economy is facing a slowdown, fuelled by high inflation. The monetary tightening measures being resorted to by central banks are taking a toll on the value of the rupee and on the country’s exports. The Monetary Policy Committee has its task cut out, to calibrate its interest rates to propel growth while ensuring inflation is under control.

M Jeyaram

Sholavandan, TN

Stock market movement

With the Q2 GDP slowing, especially dragged down by manufacturing and inflation, one expected a negative reaction from the stock market. But, surprisingly, the bourses have scaled new highs on the strength of foreign investments.

The disproportionate reaction should serve as a caution for ordinary investors, who invest their hard-earned savings in stocks.

The global economy has been on a decline with recession looming large and it will have its impact on the Indian economy as well, though to a smaller extent given the basic strength of the economy.

Thus the global climate for investments and growth is not encouraging and needs to be factored in while reacting to investments by foreign portfolio investors.

FPIs are very adept at swimming against the tide and reaping benefits from the volatile Indian stock market.

Kosaraju Chandramouli

Hyderabad

G20 agenda

Apropos ‘Today, India commences its G20 Presidency’ (December 1), India must strive to depoliticise the global supply chain of goods and services.

It must contribute to solving pressing issues of international importance, by conducting meetings as and when required in multiple locations.

The theme ‘One Earth, One Family, One Future’ that India plans to propagate during its G20 Presidency is laudable.

NR Nagarajan

Sivakasi, TN

Promoting coffee

This refers to ‘Coffee Board goes online to promote the brew’ (December 1).

The Indian Coffee Board must ensure that the pecuniary benefits of online coffee marketing reach small and medium growers, and later to large growers as well based on the success of the new model.

Rajiv Magal

Halekere Village, Karnataka

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