Connect with us

Economy

The Entrepreneurial Age & Global Pandemic Recovery

Edward Burne Jones
Avatar photo

Published

on

How can a nation save itself from repeated mistakes? Why do huge opportunity losses for not having national mobilization of entrepreneurialism as a safety net and not creating highly skilled citizenry occur?  The intents are always there but why manage differently? The funds are always spent but in which direction? How long will a trillion dollars relief injected into a money-addicted mentality last? What are some immediately deployable solutions?

Erasing micro manufacturing and micro trading; while exporting industrial plants is what dragged once mighty nations to their knees. When numbers do not add up, smashing the calculator is one logical option. Needed today, dedicated formatting of talented productivity colliding with innovative excellence under entrepreneurial wisdom to push out global game-changers out of the garage doors? Is this rocket-science or common sense?

Humankind’s problems are now searching for humankind’s solution; to decipher this Babel, deeper studies on such factum already neglected by scared academia are now prerequisites for better fine-tuning of mindsets, a cry of the time. Study the history of the ecommerce revolution. How brains and decorum left loose just to build. Open the garage doors wider. Climate change issues better served by innovative excellence out of job-creator mindsets and not by gazillion dollar PR and case studies proving who is right and who is wrong. They are all confused, while calamity is visible.

The entrepreneurial age is once again a forlorn rise, The pandemic recovery is a harsh test on our civilization. Gummies flavored yummy vaccines are not the final answers yet. Fighting progressive business ideas on real tactical battlefields of real value creating enterprises and rolling wildly in sand boxes is where future growth hidden.

Nouveau occupationalism as if professional hobbyist on the toboggan slides altering mindsets in real times and going all out adventuring. Of course, this is extremely scary for the traditionalist gold-watch-awaits but extremely fruitful for youthful masses without any direction. Study the last 100 greatest entrepreneurs how they tumbled upon an idea by mistake. Mistakes and failures are non-issues to entrepreneurs, as they never hide it, other mindsets do. Study deeply.

After the Second World War, the survivors created the largest ever-entrepreneurial turnaround.  Ecommerce revolution was not an academic case study, rather born in garages when thousands of youthful techies of the period like Jobs and Gates toyed with technologies and moved mountains. South East Asian entrepreneurship suddenly began after 2000, when experienced, educated and liberated minded immigrants went back to their own countries as America treated them with suspicious looks at airports, offices and society.

This post pandemic assembly of displaced on the march is the largest ever in the history of humankind; most are already out of the box. Most have no idea of the future, an entrepreneurial trait of openness. Now to manage such narratives any academic psycho-mumbo-jumbo will fail. Which nations are bold and smart enough to harness their entrepreneurial powers? Leaving them to migrate from nation to nation, will only break and split host nations apart? Which nation has the frontline teams articulate enough on such agendas? Which nations are busier in acquiring more riot gear? What is stopping national debates and realistic assessment of the calamites? What are the next immediate gateways and pathways?

Such advancements are not the intellectualism of political science primarily based on Machiavellian treachery and now morphed into crypto-tyrannies; this is more a common sense revolution based on rebuilding grassroots prosperity in addition, creating real value based economic development models. Despite its random invisibility, entrepreneurialism is far more disciplined behaviors of risky adventure into perfection. Such fine art of business expansion bearing battlefield scars with only straight lines mentality is a serious mistake.

These undercurrent entrepreneurial movements are only visible to “job-creators” and now expanding towards “job-seekers” with positive options. Few selected leaderships and regions are aware of such transitions, the rest still on their gong-shows waiting for their moment. The COP26, G&, G20 all speak volumes. Best replay the events. The world economy is ready for a modest change where small business declared as big business, to bring a new perspective at the next Cabinet Meetings. Worshiping big business is good but to give them a full set of keys of the house, not wise.   

Why Brainwashing suddenly reversed; across the world, leaders of sorts, already believe they have mesmerized the global populace, but how wrong. The garbage-in-garbage-out social-media-education-systems designed for masses of the world are surprisingly now in reverse order dry-cleaning the brains. Finally, the public discovered their weaknesses and limitations but also their own hidden potentials while surrounded by broken systems.  

The 500-day-isolation created brand new wisdom. The whistle-blower-narratives further verified what the public already knew. Spanning decades, neither the mainstream education, nor the media and political narratives contributed anything significant to unite the citizenry. The bifurcation of all groups of societies, pushed into sequential events to entangle in foolish battles of their own inner sanctums while ignoring the root causes and crumbling realities. The masses are increasingly aware of misguided flamethrowers.

Control the words; control the thoughts, actions and results. The billions, displaced, replaced, misplaced on the march are not amused. They now have better words of their own. Today, it is beyond words on coffee-mugs, t-shirt slogans and election buttons. This is also beyond the teleprompter rhetoric and election promises, because this is when humankind faces humankind-size problems. Truth the only sword left to the populace and common sense the only logical wisdom to guide. Duck is no longer the Swan.

Degrees and bureaucratic experiences bring little or no value, more personality and attitude tests needed to match skills and capabilities, because now mindsets on fixing the future must demonstrate futuristic literacy. Failed and struggling nations showing their own self-inflicting damages are all queued in their respective lines of winners and losers. Technology did create the hyper-telescopic capabilities to observe and expose nation’s performance levels in the open in real time. It is those bureaucracies still frozen in the old time zone mindsets. The squeeze on performance demands will have skills road tested. Without diversity, tolerance and social justice, the societies will stay standstill under dark clouds. The entrepreneurialism is a proven trajectory for the job-creator mindsets. Job seeker mindsets will grow, build and create harmonious grassroots prosperity. Study deeply how national mobilization of entrepreneurialism creates uplifts on local regions and stabilizes economies. 

Why is this happening in 2022? Western Economies, the new world of officeless, workless societies now need a new mobilization strategy on how to transform millions once mighty office workers now either depressed or angry, slowly marching on main boulevards of the nations.  The dark clouds over downtowns now juggling new working models, while the rise of populism in closed-door discussions a hot topic. There is no mass resignation, it is all about readjusting of mindsets and exploring new options, because Covidians now more experienced to evaluate better alternatives.

What will help? As an economic survival strategy, in this vacuum no other than entrepreneurialism must occupy the center stage and fill voids where the art of national mobilization of entrepreneurialism on digital platforms economies turns into a science as a success model. Today, engaging the confused working citizenry with real value creation options with authoritative solutions and entrepreneurial blood to transfuse the lingering economies are the critically missing links.

Who needs to understand mobilization of entrepreneurialism? Nations around the world have tried to create entrepreneurialism but frequently failed. However, these same nations were able to create well-trained armies and high-ranking officers because they all trained in tactical battlefield engagements and by veterans with real life experiences. Soldiers do not draw pictures of battlefields on whiteboards and run around with water pistols. They practice real life situations, repeat, practice and live the battles. The job-seekers mind build organizations but it is the job creator’s mindsets that originate the ideas and deployments necessary to create the existence of that organization in the first place. A massive shift towards understanding entrepreneurialism is necessary and as a battlefield and not as a whiteboard post-it dance. This is a war of the mindsets, take it or leave it.

Which nations are ready? Are there enough trade-groups, Chambers of Commerce, Trade Associations anxious to play on these digitally advanced and globally friendly market places? Outside a minuscule number, around the world, out-dated trade-groups are in rapid transformation so they too would become shiny butterflies for the new global-age. Urgently needed is a major transformation of extraordinary proportion, to help national imbalance on work-disorder and shifts towards new paths. Needed are openly debated fears of mass upskilling and reskilling and various outcomes.

What are the challenges of 2022? What will it take to transform the frontline economic development agencies of the nation to come full circle on job-creators and job seekers’ mindset and discover magic in combinations? Will this remove external trade-wars mindsets toward internal skills-wars to upskill, reskill internal citizenry? Will this bring all trade groups under one large umbrella with global age digital demands and entrepreneurialism as the key driver? Will it transform the old conflict based litigious mindsets? Is it possible we re-entered into an ‘age of curiosity’  where extreme uniqueness and originality will survive. 

What are the amazing facts? The world can easily absorb unlimited exportable ideas in unlimited vertical markets. Fact: The well-designed innovative ideas are worthy of such quadrupled volumes. Fact: The entrepreneurial and dormant talents of a nation are capable of such tasks. Fact: The new global age skills, knowledge and execution are now the missing links.  Finally, why is national mobilization of entrepreneurialism blocked by whom and for what lack of understanding?

The rest is easy.      

Naseem Javed is a corporate philosopher, Chairman of Expothon Worldwide; a Canadian Think tank focused on National Mobilization of Entrepreneurialism Protocols on Platform Economy and exportability solutions now gaining global attention. His latest book; Alpha Dreamers; the five billions connected who will change the world.

Economy

Global Recovery: Mobilize SME, Digitize Economies and Commercialize Exportability

Avatar photo

Published

on

Like an open book, all such deployment ideas are already available for last many years to allow immediate mobilization of any national small medium business economy. On the world stage, as a recovery, nations can digitize on fast tracks any selected sectors of economies and get ready to dance on global digital platforms. Nations can become examples on creating superior exportable goods and services while commercializing innovative ideas on the global stage. There are no secrets on how to achieve all this, but there are huge secrets why it is still not being done despite all the economical struggles?

How to capture opportunity losses; the biggest tragedy of any disconnected economic progress is watching the world ‘continuously’ advancing, consuming and growing, while nations ‘persistently’ despite extraordinary resources abandoned, talented citizenry only herded and left as spectators, trade associations, chambers and government agencies remain disconnected. Therefore, needed are precise world-class goals, as national symbols of unity, diversity and tolerance. So, what are the top missing rules to mobilize a nation on economic development fronts and what is stopping?

How to grow economic development? The fastest way is via right meaningful collaborations, alliances and brokering of deals, the fears of communications must be eliminated, the trepidations of opening global markets is just a mindset issue but not having bold open dialogue on fast track vibrant programs is a killer. Establish, define and articulate a long term agenda and drive like a formula car.

National mobilization of SME entrepreneurialism is a step by step methodology, if there is still no progress after a decade, which only raises serious questions about available skills to lead such a charge. Similarly, 50% mobilization of the qualified SME if allowed to dance on global digital platforms creates productivity, performance and profitability and therefore brings foreign exchange to improve national grassroots prosperity. If local economic development teams do not openly engage, adapt and utilize available blueprints and related mobilization expertise little or nothing will happen.

This is not about good or bad management; this is about core competency to move national economies towards pragmatic progress, particularly, when national mobilization of entrepreneurialism is already an entrepreneurial movement. This is far apart from the traditional bureaucratic procedural paperwork and especially in most cases not necessarily new funding dependent rather execution hungry and deployment starved. In most cases, the lack of knowledge on the global age demands and transformation of digital platforms, that leaves the SME behind. Study more why will population-rich-nations lead knowledge-rich-nations?

Matter of choice: Unless immediately exercised the required departmental tests and measure capabilities matching right mindset and speedy execution requirements, just piling up degree-holders and highly preferred staffing without precision is in reality what is destroying economic development.  So, choose economic progress or choose bad HR, the economic recovery has no time to waste. Explore new options on how to acquire mastery on such affairs. What level of efficiency is required to become a productive nation to cope with the consumption hungry world?

Furthermore, to play in global commerce, the global age speed of communication acts as a power of progress rate. There is no room for departmental responses to take days, weeks and months, but must face global age demands as a thriving 24x7x365 living world waiting for immediate response. What will it take to create a LIVE economic development recovery program of highly integrated departments? What levels of expertise are required to start deployments of such thinking? Better understand how other nations are doing, study a new world of G20 and national mobilization of small medium business economies

Capitalism is not failing; it is economic development. Unless mandated differently, the circus will go on. The skills gaps are not about lack of degrees; rather, global age experiences to understand how the pyramid of global consumption works, how to open new markets and how to produce real value to stand up to the global age of competitiveness. Skills are not about degrees, but now translated into global age skills as art of communication, presentation and global age level understanding of diversity, tolerance and entrepreneurial mindsets.

Why blind leading blinds; why high priced and fancy studies on SME always select ‘access to finance’ as the mother lode problem but they critically lack centricity of entrepreneurialism as such studies are academic driven. Hence the biggest disconnect, SME founders are not interested in loans but sales. Sales are more about value creation and globally accepted production standards to cope with global age competitiveness, where they do not require consultants rather developed skills to become better executives and better producers. They need help but not the loans, they need skills and knowledge and not the procedural and conflict resolution compliances. They know too well what to do but need to know how to do it better. Cookie cutter complex forms and rubber stamping will never do the trick, they need entrepreneurial dialogue, but not from academia but real entrepreneurs. They strive for meritocracy and not bureaucracies.

No, this is not an academic study but an entrepreneurial response to grand economic failures by the majority of nations on up-skilling SME and re-skilling manufacturers at national digitized levels. Furthermore, failing to understand the difference between the job seeker and job creator mindsets is the first step to get eliminated from any serious dialogue on the subject of SME economic recovery. Failing to articulate on the national mobilization of entrepreneurialism is the second step to get eliminated from any economic development activity as a whole. Study more on Google.

Proof is mandatory; when it takes 10 days to debate, strategies and finalize a national mobilization programs, and when it takes 100 days or organize digital platforms to deploy 10% to 50% selected SME on digital platforms and 1000 days to turn around small medium business economies so why still there is no show after last 5 or 10 years. If there is nothing wrong, why are the restless citizens marching in protest? Why are economies openly collapsing and what is stopping them to correct the course and how much it has to do with core competencies at the source of economic development? Is it possibly now a time for the first industrial revolution of the mind

Next key steps: What can current teams learn and what can they deploy within 90 days in any sector or any national economic realignment. How can they be framed as a customized national mobilization of entrepreneurialism model? How can they select and identify 5K to 50K SME and get them ready for a digital platform? How can they start intense programs to up skill and re-skill all layers of the economic departments to become a global age expert and start thinking of future applications and methodologies of economic growth? What does it take to acquire mastery on national mobilization of entrepreneurialism within a specific SME sector or across the nation? The rest is easy.  

Continue Reading

Economy

Why the burden on business women to ‘do it all’ must stop

Avatar photo

Published

on

Glorifying multi-tasking by women is something we are all guilty of – across the globe we celebrate women who have responsibility piled on their shoulders. For those running their own businesses, the burden can be even greater. And why? Because of outdated expectations. It’s time for us all to shake up our thinking and act, so female entrepreneurs can thrive.

The expectation that a woman should be the primary childcare giver and that the man should be the breadwinner are views so ingrained they remain consistently unchallenged. New research from CARE’s Ignite program confirms that women entrepreneurs worldwide are so bound by these norms, it is stunting their business success – meaning less income for the household and less employment for the community.

  • In Vietnam, 80% of men and 60% of women agreed that businesswomen should be the main childcare giver, despite the pressure of running a business.
  • In Peru, 80% of women interviewed say they are bound by traditional gender roles and the expectations and pressures from the family and society as caregivers.
  • In Pakistan, 76% of respondents felt that family members will disapprove if a woman entrepreneur’s earnings surpass her husband’s.

One of the most alarming findings was that when women entrepreneurs start to succeed, they can face sabotage by their male family members, sometimes even violence or sexual harassment. In Pakistan, women told us that if they start earning more than their male family members, they are overburdened with household responsibilities to the point that they are forced to cut down on, or even discontinue, their business. Furthermore, women entrepreneurs who leave the house for business without a male family member are considered less moral and may be subject to harassment or sexual requests in return for work-related agreements.  In Peru, 100% of the women entrepreneurs interviewed had either seen or heard about a case of violence in their close environment. And broader research shows that 70% of women owners of formal small businesses have experienced violence by their partner including physical and economic violence. It is estimated that due to gender-based violence, women micro-entrepreneurs lose around $ 9,000 USD each year, causing a loss of 5.72% of GDP in Peru.

Revealingly, it is not just men who are piling expectations on women – it is also women themselves and their female family members. In Vietnam, mothers-in-law were revealed as the staunch enforcers of the norm related to childcare, the ones who would most disapprove if the man does more childcare than the woman.  In Pakistan, it is predominantly the husband’s mother and his sisters who load pressure onto women to be at home taking care of the children and the household, and for the man to be the main breadwinner.

It is clear that little is being done to shift these norms and the time to act is now. Having worked in financial inclusion for 15 years, I have seen many fantastic initiatives focused on helping women gain better access to finance so that they can grow their businesses. But very few initiatives try to understand or address the deeply entrenched gender norms that are holding women entrepreneurs back. Time poverty is one of the biggest challenges facing women, a condition deeply intertwined with childcare and household duties. Admittedly, shifting gender norms is not an easy task, as it requires longer-term commitment and won’t necessarily provide a short-term return. But that shouldn’t stop us. At CARE we know that engaging directly with families can be transformational, increasing both the time women can spend on their business and their decision-making power.

I recently met with Thu in Vietnam who runs an organic farming network, as well as her own food business.  She told me that she was really struggling with a lack of support from her husband which was affecting her marriage and her business. Following an event that we ran for women entrepreneurs and their families that promoted shared responsibility at home, she told me she had seen a transformation, she said: “On that day, for the first time, he acknowledged my work and my contribution to society and the community. Since then he is really helping out with the children and the household chores.  Now I can travel much more for work.”

Through a combination of far-reaching social media campaigns and in-person workshops, CARE is beginning to see small changes. Media campaigns in all three countries, with male and female role models, have showcased shared responsibility in the home and are normalizing the growth and success of women entrepreneurs, with the campaigns generating a widespread appreciation for female entrepreneurs.

We know that by giving women increased opportunities and time, it allows them to focus on growing their own businesses so that they can further contribute to their local economies. We also know that women employ women and invest their incomes in their families and their communities. The benefits are indisputable.

My message to NGOs and financial institutions working in financial inclusion is clear:

  • Design holistic programming for women entrepreneurs that includes addressing restrictive gender norms.
  • Design programs that promote the benefits of shared responsibility in the household and the economic contributions of women entrepreneurs.
  • Collect data related to perceptions and expectations around gendered roles and how these present barriers for the growth of women-led enterprises.
  • Advocate for policies that respond to the specific challenges that women entrepreneurs face.
  • Investing in women will always provide a return.

Having conducted this research, we are also making changes to our programming. We are developing new training, not just for women and their families, but also for our financial partners. We will also continue our campaigns and outreach activities which promote and normalize shared responsibility and women’s financial and digital independence.

By studying the barriers that are holding women entrepreneurs back, and then working closely with local partners to break down those barriers, CARE is building new opportunities for women entrepreneurs wanting to grow their businesses.

Despite the Ignite program launching in the midst of the pandemic, the program has unlocked 115 million USD in loan capital for women entrepreneurs, a twenty-two-fold uplift of the original program funding provided by the Mastercard Center for Inclusive Growth. 83% of Ignite participants tell us that the program has contributed to an increase in their business sales, helping to build their financial resilience.

By working together with women and their support networks we want everyone to recognize the importance of shared responsibility at home, and to value the enormous contribution women entrepreneurs are making to their families, communities and economies.

Continue Reading

Economy

The Upcoming Recession and its Ramifications on the World Economies

Avatar photo

Published

on

The recent decision of the new head of Twitter, Elon Musk, to sack approximately 50 percent of the workforce is only indicative of the recession that is glooming over the world. The story of Twitter is just one example among many visible ones. Almost all the major firms around the globe have or are planning to lay off employees, including Microsoft, Meta, Tencent, Xiaomi, Unacademy, etc. 

According to a comprehensive study titled ‘Risk of Global Recession in 2023 Rises Amid Simultaneous Rate Hikes’ by the World Bank, all the nation-states are tilting towards a cascade of economic crises in global financial markets and emerging economies, leading to long-term damages. The report blames central banks around the globe for raising interest rates to tackle inflation caused due to the Coronavirus pandemic and Russia’s aggression on Ukraine in the European arena. The report states that even raising the interest rates to an unprecedented high not seen over the past five decades will be insufficient to pull global inflation down to the pre-pandemic levels. It further instils the need to focus on supply disruptions and subside labour-market pressures. The President of the World Bank Group, David Malpass urged policymakers to focus on boosting production instead of cutting consumption and make policies that generate auxiliary investments, improving productivity and capital allocation, which are crucial for growth.  

Economics 101: Recession

Amidst the pandemic, many states released relief and stimulus packages that heavily leaned on measures to expand liquidity, such as loosening lending restrictions or reducing repo rates (the rate at which commercial banks borrow money from the central bank) as well as reverse repo rates (the rate at which commercial banks lend money to the central bank). China was the first state to act upon these stimulus measures to counteract the disruptions caused by the covid, followed by Japan, the EU, Germany, India and so on. Though the measures helped economies absorb the pandemic’s impact, one major drawback was increased demand due to induced money flow in the market, leading to inflation.

Inflation, defined as the rate of increase in prices of general goods and commodities in a given period of time, can be caused by multiple factors. A shortfall in aggregate supply, one of the most common factors, can lead to excessive demand pressures in the market. To curb inflation, central banks often tweak or change the fiscal and monetary policies of the nation. Increasing the interest rates is one such measure, as it tightens the economy’s banking system and thus contracts the flow of money, reducing already high demands. However, suppose only the rates are increased without substantial reforms in line with resetting the supply chains, increasing production and overall growth to meet the demand; in that case, a country may move towards a recessionary period. Therefore, alongside rising rates, a nation must diversify its suppliers, invest in technology (without increasing the debt burden), and focus on self-reliance while sustaining employment.

The International Monetary Fund (IMF) defines recession practically as the fall in a country’s Gross Domestic Product (GDP), i.e. a decline in the value of all the produced goods and services in a country for two consecutive quarters. Simply, a recession is a period of massive economic slowdown. Pointing at a specific moment when a recession occurs is almost impossible and futile. However, a few indicators, like the downfall of GDP and public spending, increased unemployment, and a decline in sales and a country’s output, generally point towards an upcoming recession. To sum up, there are various ways for a recession to start, from sudden shocks to the economy and excessive debt to uncontrolled inflation (or deflation) and non-performing asset bubbles.

The Stumbling Economies

According to IMF Managing Director Kristalina Georgieva, “First, Covid, then Russia’s invasion of Ukraine and climate disasters on all continents have inflicted immeasurable harm on people’s lives.” One-third of the world economies, including the United States, Europe and China, are expected to contract in the subsequent quarters. 

For US economists and forecasters, the recession is no longer about ‘if’ but ‘when’. The decision of the Fed (US Central Bank) to increase rates to cool inflation without inducing higher unemployment and an economic downturn has only shrunk the possibility of a ‘soft landing,’ which occurs when the tightened monetary policies of the Fed reduce inflation without causing a recession. Nouriel Roubini, one of the few economists who rightly predicted the financial crisis of 2008, also claims a prolonged and inevitable recession in 2022 that will last till 2023. Economists expect a growth rate of 0.4 percent in the fourth quarter of 2023 as opposed to the fourth quarter of the previous year, and in 2024, they expect the economy to grow at 1.8 percent. The rate of unemployment is expected to rise to 3.7 percent in December this year and to 4.3 percent in June 2023, compared to 3.5 percent in September.

Like the US, Europe was also under the impression that the economic situation would improve without a recession. Assumptions of subsiding or transitory inflation due to solid businesses, enough public savings and adequate fiscal adjustments turned out wrong for the European economies. The Euro area (5.1 percent), and the UK (6.8 percent), are among the countries with the most expected output loss. Europe has mainly been affected by the Russian war on Ukraine and the resulting oil and gas disruptions leading to an ‘Energy War’ against the former. Similarly, China doesn’t lie far from them, with an expected output loss of 5.7 percent in 2023. Zero Covid Policy, coupled with the mortgage crisis and exodus in the manufacturing sector, has led to the economic slowdown of the Asian giant.

Impact on the Indian Economy

India reported a growth of 13.5 percent in the April to June quarter and became the world’s fifth-biggest economy, taking the spot of Great Britain. However, this growth results from the nation’s shutdown amid Delta-driven covid lockdowns during previous quarters and not because of the significant improvements in the economic activities. India needs to focus on skill-based human development projects to unleash its economic potential and effectively utilise its demographic dividend. However, India is not immune to the global slowdown. It is expected to face an output loss of 7.8 percent in 2023. 

Indian CEOs are also expecting a decline in the growth of companies, but the economy is expected to bounce back in the short term, according to KPMG 2022 report. Moreover, 86 percent of CEOs in India expect an impact of up to 10 percent on earnings in the next 12 months. Reducing profit margins, boosting productivity, diversifying supply chains, and implementing a hiring freeze (worst case, layoff policies) are a few steps firms can take to weather such challenges.

India, thus, needs to tap the potential of start-ups and small enterprises, as opposed to just established firms, by expanding and enhancing the private sector’s access to capital investments and curbing environment-related risks. Reforms in dispute resolution mechanisms are also long overdue, evident through the Ease of Doing Business report, where India ranked 63rd out of 190 countries worldwide. India needs to prove its worth by showing investors that not only can their money achieve decent returns, but it is safe in Indian soil as well. 

The stand on India’s future remains split. The global rating agency S&P claims that India will not face the true and horrifying brunt of the global recession thanks to its decoupled economy with huge domestic demand, healthy balance sheets and enough foreign exchange reserves. On the contrary, according to the Japanese brokerage firm- Nomura, policymakers are misplaced in their optimism about India’s growth trajectory. Its economists assert India’s estimated growth at 7 percent in FY23, which is at par with the RBI’s revised forecasts, but it also predicts a sharp decline to 5.2 percent in FY24. This estimated growth doesn’t align with India’s commitment to becoming a 5 Trillion USD economy.

Way Forward

UNCLAD’s Trade and Development Report 2022 projects global economic growth will plunge down to 2.5 percent in 2022, followed by a drop to 2.2 percent in 2023, costing the world a loss of more than 17 trillion USD in productivity. It further warns that the developing nations will be most vulnerable to the slowdown resulting in a cascade of health, debt and climate crises. Regarding the proportion of revenue to public debt, Somalia, Sri Lanka, Angola, Gabon, and Laos are the worst-hit countries, evident through the excessive inflation these states face.

Similarly, Indian fuel and food commodities prices have increased, but India’s sturdy performance when other countries are struggling can be attributed to its efficient policies. India does not have a perpetual external debt burden to hamper its growth. In addition, the government has focussed on developing the industrial and service sector to promote jobs and increase savings, especially after the Pandemic, to revitalise the Indian economy. Domestically, the government has provided effective social safety nets to ensure healthy livelihood for the population. 

Despite these factors, India must realize and accept the harsh reality of the upcoming turbulent times. India may have a decoupled economy, but the world is one interlinked system. Global slowdowns will lead to a recession in India as well, whose effects are becoming more and more visible with each passing day. Major tech firms in India like Wipro, Tech Mahindra and Infosys have revoked their offer letters to young freshers, while others have started laying off employees amidst the fear of global recession. Irrespective of whether India becomes the “fastest growing economy” in the end, even a modest growth rate of about 5 percent will push millions into poverty in a country like India. It’s only imperative to realise that a depreciating currency and elevated inflation will hit the poorest the hardest, and India must be prepared to deal with this challenge.

Continue Reading

Publications

Latest

Trending