Indian Economics thread.

[ansy1968]

Demographic dividend is a real thing.

It allows a country to quickly amass wealth by doing the bare minimum (build houses, schools, roads, retail goods sales).

With a huge pop a country can quickly get trillions in wealth even with an incompetent leadership.

The issue arises when this "fast" growth ends, you need a competent leadership to implement policies, have better rules, better laws, more investment friendly low corruption etc

This is where India is failing right now. It is stuck with corrupt and incompetent politicians who are ruining the country and wont allow it to grow more

@voyager1 , bro we had the same demographic dividend with India here in the Philippine, look what happen, we become a leading exporter of labor, so instead of nation building , we export workers to help build their economy. So ironic isn't it? (investing in their education and let others benefit) Literacy wise we're better than India with 40% of our national budget allocated to it including tertiary education (90% literacy rate). We need population control cause we're brimming with people and religion is a major factor in hindering it, with 110 million how can we feed all of them and a sad part is we're an agricultural country but we import most of our food especially rice from Vietnam, because of topography we don't have the necessary land to tilled.

 

[KampfAlwin]

@voyager1 , bro we had the same demographic dividend with India here in the Philippine, look what happen, we become a leading exporter of labor, so instead of nation building , we export workers to help build their economy. So ironic isn't it? (investing in their education and let others benefit) Literacy wise we're better than India with 40% of our national budget allocated to it including tertiary education (90% literacy rate). We need population control cause we're brimming with people and religion is a major factor in hindering it, with 110 million how can we feed all of them and a sad part is we're an agricultural country but we import most of our food especially rice from Vietnam, because of topography we don't have the necessary land to tilled.

I feel like ‘democracy’ doesn’t really work for underdeveloped nations because the institutions aren’t strong to begin with. Many places that are rich(Singapore, SK, Japan, Taiwan etc)now were very authoritarian in the past, allowing them to pass laws easily and develop before transitioning into a ’free’ country. It’s hard to be a democracy if the government is extremely corrupt due to being poor.

 

[ansy1968]

I feel like ‘democracy’ doesn’t really work for underdeveloped nations because the institutions aren’t strong to begin with. Many places that are rich(Singapore, SK, Japan, Taiwan etc)now were very authoritarian in the past, allowing them to pass laws easily and develop before transitioning into a ’free’ country. It’s hard to be a democracy if the government is extremely corrupt due to being poor.

@KampfAlwin bro we had a chance with Marcos but he blew it big time, some of it is his fault but from my observation the western financial institution is a major factor, the devaluation of the peso is a major contributor in the disintegration of our economy, the foreign loan that is being used to finance his infrastructure program is being recalled for repayment. After the devaluation he launched an labor export program to solved our dollar problem. Since we had a good education institution, we're able to leverage it to the world market and their remittances is our major source of income contributing to our dollar reserves. Mind you at that time our population is 48 million, with succeeding administration they see the economic value and become one of our top exporter. But with competitive international labor market, Employers had more control due to labor surplus and therefore offer lesser pay and benefit than before. And with a side bonus of physical abuse and discrimination.

Bro if we can bring back time and the Chinese is rich enough to help, we will have none of these problems. It's a debt trap being used by the American to cripple our effort to industrialized because of the two strategic US bases (Clark and Subic). All those country you mentioned had immediate threat so the US needed to strengthen them. We as a former colony is seen as such, a colony. For them any Filipino leader that become independent will be dealt with accordingly.

 

[hkbc]

I feel like ‘democracy’ doesn’t really work for underdeveloped nations because the institutions aren’t strong to begin with. Many places that are rich(Singapore, SK, Japan, Taiwan etc)now were very authoritarian in the past, allowing them to pass laws easily and develop before transitioning into a ’free’ country. It’s hard to be a democracy if the government is extremely corrupt due to being poor.

Democracy works great for developed countries because it allows them to buy power in underdeveloped countries right up to the point the local population gets so disgusted they rise up and revolt, e.g. Cuba in '58.

Its then deemed a coup and 'anti-democratic' so they can sanction and basically lay siege on the place until 'democracy' is restored and they can buy the next lot.

Because things worked out so messily in Cuba, so the modern rendering of it is to simply allow the local population to pick some puppet who inherits a mountain of IMF debt or other problems and has no real options but to go along and when things turn sour its painted as your own fault, you picked your leader! A lot less messy than propping up an unpopular leader like what happened in pre-revolutionary Iran!

Sometimes it takes a bit longer, case in point India, for most of its existence the Union of India was non-aligned despite a war in '62 with China relations were OK, under the Congress led government they even came together in BRICS. Fast forward a few years and India is now a rabid China hating member of the QUAD on the back of some vague IoUs and promises of help and the usual pump and dump fast buck cyclical economics, beloved of American Bankers, that is merely quick drying paint to hide the real structural issues. A stiff breeze (like a pandemic) a the whole deck of cards comes tumbling down, depending on how things turn out the next puppet please!

Democracy can work in under-developed countries if you just ring fenced them from interference by developed ones, unless you're an anarchist, you'd vote for the people who'd do good, right! End of day a classic case of guns don't kill people, people kill people!

 

[weig2000]

Demographic dividend; demography is the destiny...

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The repercussions of the second wave of the Covid-19 pandemic showcase this inability in the most unfortunate manner. Pages after pages have been filled on what India needs to do over the last few decades in the hope of benefiting from its demographic dividend when the moment arrives. The moment is here, and the country is nowhere near shifting its economic trajectory. Malthus’ pessimism with population seems to be more appropriate today than any demographic optimism.

 

[gadgetcool5]

@voyager1 , bro we had the same demographic dividend with India here in the Philippine, look what happen, we become a leading exporter of labor, so instead of nation building , we export workers to help build their economy. So ironic isn't it? (investing in their education and let others benefit) Literacy wise we're better than India with 40% of our national budget allocated to it including tertiary education (90% literacy rate). We need population control cause we're brimming with people and religion is a major factor in hindering it, with 110 million how can we feed all of them and a sad part is we're an agricultural country but we import most of our food especially rice from Vietnam, because of topography we don't have the necessary land to tilled.

How many unicorns does the Philippines have? Of course population is not the only requirement but population is a prerequisite to having true heft. The Philippines has always sort of been the sick man of SE Asia-- this goes back to the 1980s. If you see the distribution of furniture exporters that left China due to the tariff war-- Vietnam benefited the most, followed by Thailand and Malaysia, then Indonesia. On the other hand India is not as bad because it went from being the sick man of South Asia in the 1980s trailing behind Pakistan to moving ahead of Pakistan now.

India emerges as China’s tech challenger with record run​

India is rapidly closing the gap with China in minting new unicorns — privately held start-ups valued at $1bn or more — highlighting growing investor appetite for tech start-ups in the country as the pandemic accelerates the adoption of digital services. Over the past year, 15 companies from India raised capital at a valuation of $1bn or more for the first time, according to CB Insights and company announcements gathered by Nikkei Asia. Ten of them became unicorns in 2021. By comparison, only two of the 15 companies from China that joined the list over the past year did so in 2021, according to CB Insights.

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In reality though, I am optimistic about the future of the Philippines and Southeast Asia in general, especially the Singapore, Vietnam and Indonesia because the latter two have decent sized populations and stable demographics and the former is in a position to benefit.

In China, Chinese tech companies are getting it from both sides -- Xi's crackdown is against them, and the US govt is against them. As a private tech company, with the two most powerful governments in the world against you, what chance do you have? I am confident China could have generated a lot more than 2 unicorns this year and beaten India easily, but so many IPOs were cancelled or downsized due to the tech crackdown and no doubt this had a bad effect on private equity as well. Meanwhile if you are a US, Indian or Southeast Asian company then your governments support you, and you got no political worries. You focus 100% of your energy on innovation, profits, creating jobs, and expansion. A dream.

 

[voyager1]

How many unicorns does the Philippines have? Of course population is not the only requirement but population is a prerequisite to having true heft. The Philippines has always sort of been the sick man of SE Asia-- this goes back to the 1980s. If you see the distribution of furniture exporters that left China due to the tariff war-- Vietnam benefited the most, followed by Thailand and Malaysia, then Indonesia. On the other hand India is not as bad because it went from being the sick man of South Asia in the 1980s trailing behind Pakistan to moving ahead of Pakistan now.

India emerges as China’s tech challenger with record run​

India is rapidly closing the gap with China in minting new unicorns — privately held start-ups valued at $1bn or more — highlighting growing investor appetite for tech start-ups in the country as the pandemic accelerates the adoption of digital services. Over the past year, 15 companies from India raised capital at a valuation of $1bn or more for the first time, according to CB Insights and company announcements gathered by Nikkei Asia. Ten of them became unicorns in 2021. By comparison, only two of the 15 companies from China that joined the list over the past year did so in 2021, according to CB Insights.

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In reality though, I am optimistic about the future of the Philippines and Southeast Asia in general, especially the Singapore, Vietnam and Indonesia because the latter two have decent sized populations and stable demographics and the former is in a position to benefit.

In China, Chinese tech companies are getting it from both sides -- Xi's crackdown is against them, and the US govt is against them. As a private tech company, with the two most powerful governments in the world against you, what chance do you have? I am confident China could have generated a lot more than 2 unicorns this year and beaten India easily, but so many IPOs were cancelled or downsized due to the tech crackdown and no doubt this had a bad effect on private equity as well. Meanwhile if you are a US, Indian or Southeast Asian company then your governments support you, and you got no political worries. You focus 100% of your energy on innovation, profits, creating jobs, and expansion. A dream.

The crackdown for tech companies was because the big players were muscling out small competitors by throwing money into the problem instead of truly COMPETING on technology and better features

Why should China accept for example, 2 extra unicorns per year if these companies will monopolise their sector and reduce competitiveness of their industries.

If you want to see how monopolies stiffle competition just look at the US. Xi saw that and said, no thanks!

 

[gadgetcool5]

The crackdown for tech companies was because the big players were muscling out small competitors by throwing money into the problem instead of truly COMPETING on technology and better features

Why should China accept for example, 2 extra unicorns per year if these companies will monopolise their sector and reduce competitiveness of their industries.

If you want to see how monopolies stiffle competition just look at the US. Xi saw that and said no thanks!

I don't have a problem with cracking down on monopoly. But surely at some point the rules will be defined and the companies will be cut down to appropriate market share, and know to stay in their lane. At some point the business environment needs to be given time to breathe. What I am afraid of is a never-ending crackdown that turns into a generalized push for ever-more regulation and hostility to private business. Don't forget that opening and reform is a good thing and we shouldn't go back to Mao-style central planning.

 

[voyager1]

T

I don't have a problem with cracking down on monopoly. But surely at some point the rules will be defined and the companies will be cut down to appropriate market share, and know to stay in their lane. At some point the business environment needs to be given time to breathe. What I am afraid of is a never-ending crackdown that turns into a generalized push for ever-more regulation and hostility to private business. Don't forget that opening and reform is a good thing and we shouldn't go back to Mao-style central planning.

The rules have already been made. Check the new regulations, they seem prety clear to me.

Whats also clear is that almost all of these tech companies are involved in some kind of monopolistic behaviour.

It is now up to them to fix these practises, otherwise when the regulators come and knock their door (it will happen), they will be fined to high heaven if they keep ignoring the Alibaba's lesson

 

[gadgetcool5]

T

The rules have already been made. Check the new regulations, they seem prety clear to me.

Whats also clear is that almost all of these tech companies are involved in some kind of monopolistic behaviour.

It is now up to them to fix these practises, otherwise when the regulators come and knock their door (it will happen), they will be fined to high heaven if they keep ignoring the Alibaba's lesson

They should knock on all the doors and get their work done fast because the current never-ending crackdowns and reign of terror (new negative headline every day, followed by stock market drop) is killing China's tech sector. With all this uncertainty, business doesn't know what to do, the entrepreneurial spirit is dying. As I said I have no problem with this as long as there's an end date. My fear is that it turns into a never-ending expansion of regulation and ever escalating hits on private companies until China's economy looks like the Soviet Union.