Working Papers

Revision in the estimates of domestic product (GDP) is a continuous process. Availability of more update data and changes in methodology which enlarges the access of data are the two factors which result in revision in the initial estimates of GDP. Base year of GDP is also revised regularly to have it aligned with the structural shifts that the economy witnesses continuously.

M.C. Singhi
R Gopalan

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Manufacturing sector has significant fiscal policy implications. Most of indirect taxes, such as customs and excise duties and corporate income tax originate from manufacturing sector. While the expenditure implications are not that significant but both tax and transfers (including tax expenditure) proposed in Budget are manufacturing centric and aim at either accelerating investment or making the products more affordable and competitive.

M.C. Singhi

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Services have significantly contributed to the structural transformation of Indian economy. Sustained growth of services in India has to an extent broken the myth which has considered acceleration in manufacturing in the initial stages of development as inevitable. Services have grown at a faster than the GDP growth consecutively for last 10 quarters and its contribution to growth has averaged over 80 per cent during this period

M.C. Singhi

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The central themes of Jainism are ahimsa (non-violence), anekant (non-absolutism) and aprigraha (non-possession). Non-violence strengthens the autonomy of life of every being and if one believes that every soul is autonomous then one will never trample on its right to live. Non-absolutism strengthens the autonomy of thought of every individual and if one believes that every person is a thinking person then one will not trample on his thoughts and allows diverse views to prevail. Non-possession strengthens the interdependence of every soul and if one believes that one’s own existence is interdependent one will think twice before trampling on this planet . These core elements have been the building blocks of economics of Mahaveera.

M.C. Singhi

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After sustaining an average growth of over 8 per cent during 2003-2012, India witnessed a sharp deceleration in growth of less than 5 per cent in next two years. While initially this slowdown was attributed to a fragile global recovery, it was latter realised that domestic factors have perhaps contributed more to this sluggishness.

As this paper has observed that the macro fundamentals were indeed pointing to this slowdown, notwithstanding the smart recovery in two years of 2009-2011, immediately after the global economic meltdown. But a sharper moderation in growth than even the most pessimists had earlier visualised was due to depressed sentiments, depressed investment and capacity constraints and the perceived policy logjam. These were also the factors which contributed to inflation which remained stubborn despite many upward revisions in policy rates by the Reserve Bank of India.

Besides setting the challenges that our economy faces in a historical perspective, the paper suggests policy options. Centad hopes that this working paper will generate informed discussion and provide important inputs for policy interventions.

S Jagadeesan
Chairman, Centad

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Balanced Regional Development has remained central to our planning process. Over the years, there have been various interventions for improving the quality of life and services in the backward states. Road connectivity, right to education and its universal access, health care and nutrition and dispersal of industries have been some of the important initiatives. While there has been an increase in growth and improvement in quality of life across the States, inequality in access to services and growth has persisted.

This paper by Centad looks at the initiatives and their outcome through the construction of an Improvement Index and suggests a relook. We hope that this paper will help improving our understanding of the issues involved in balanced growth and the interventions that may be necessary.

S Jagadeesan
Chairman, Centad

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The objective of monetary policy is to meet the twin thresholds of inflation and growth. While inflation should be kept at reasonable levels, economy should experience sustained growth. There is considerable debate in India and abroad about the point of influx, the point beyond which inflation starts impinging on growth. Several studies in Indian context have estimated this point of influx at 5-7 per cent1 of inflation measured in terms of the wholesale price index. While a low inflation could be ideal for inclusive growth, the growth sacrifice from inflation below a threshold may adversely impact the inclusion itself.

Data on growth of Gross Domestic Product (GDP) and implicit GDP deflator (which in effect could be taken as a true measure of underlying inflation in the economy) clearly indicate that the moderation in inflation in last 16 quarters has resulted in an equal (in fact greater) sacrifice in terms of growth. For over 12 quarters the observed GDP growth has also been lower than the potential growth.

R. Gopalan
M.C. Singhi

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This paper studies the impact of services trade liberalization under the currently negotiated EU-India FTA on women’s lives in India and tries to delineate the concern areas. Services sector liberalization can affect women in two major ways; by creating or destroying employment and incomes; and by, affecting the access to critical basic services like credit, health, education, water, energy. It is undeniable that many chapters of services trade liberalization involve a clear and differentiated impact on women.

India's trade policy has undergone a significant shift towards an increasing engagement with Free Trade Agreements as compared to unilateral trade liberalization or multilateral trade liberalization through the WTO. This shift in India's trade policy has had a significant impact on the agriculture sector which no longer enjoys the exclusive protection it has received so far. Since 2007, India has been negotiating a Free Trade Agreement with the European Union of which agriculture is an important component. Along with liberalization of commodity trade, and corresponding impact on tariffs and non tariff barriers, substantial movement in enforcing stricter IPRs and a much more ambitious investment liberalization policy are likely to significantly affect agriculture

India is currently negotiating a Free Trade Agreement with the European Union, which includes not only liberalization of commodity trading, but also a wide range of chapters including deep services trade liberalization, full investment liberalization, and stricter IPR conditions than the TRIPS norms. As trade is an engine of growth and development, India’s trade policy has many goals to meet. India shows high poverty level, increasing income and social inequalities as well as deep seated gender inequalities.

Given the emphasis on gender mainstreaming today, the gender impact of trade policy must be paid serious attention to, especially as it is increasingly evident that trade policy is not 'gender neutral'. The nature of international trade itself is undergoing continuous changes, with autonomous liberalization being accompanied by initiatives at the WTO as well as rapid advances in Preferential or Free Trade Agreements.

The paper broadly examines the core trade interests of the EU and India, the content of the negotiations and outlines some key concerns of a potential deal for India in the areas of goods, services and investments, intellectual property rights and government procurement.

The negotiations held at the United Nations Framework Convention on Climate Change reveals there is a wide gap between the developed and developing nations which has threatened the equity related components of the Convention.

Anti-dumping is used by a small number of countries not to ensure that world trade is fair and competitive, but to create monopolies and favour large firms particularly in large and concentrated industries, argues this Centad working paper.

The Centad working paper tracks the negotiating history of TRIPS in search of the origin of GI-related (Geographical Indications) provisions and provides a cogent account of various contours of WTO negotiations on GI to date. It also analyses the Indian GI Act in light of the TRIPS provisions.

This working paper tracks the evolution of the General Agreement on Trade in Services (GATS) negotiations since its inception, and provides a concise overview of the current state of negotiations. The paper covers key issues under the purview of the GATS from an Indian perspective, and makes important policy suggestions for India on certain sensitive sectors.

While the Hong Kong Declaration allows self-designation of Special Products (SPs), this paper discusses how SPs should be designated and categorised.

An analysis of tariff reduction modalities in Non-Agricultural Market Access (NAMA) in light of the Hong Kong Ministerial Declaration.

This Centad working paper takes a critical look at the Hong Kong Ministerial text on agriculture and NAMA. On the basis of this analysis, the paper suggests specific and important negotiating points for developing countries.

WTO negotiations on Non-Agricultural Market Access (NAMA) are about resisting hasty liberalisation in the South and dismantling excessive protectionism in the North. For India and Pakistan, the Girard formula for tariff reduction may be the best option if a non-linear approach is adopted. But this would still mean a steep reduction in tariff rates. India and Pakistan should use this as a bargaining chip and ask for compensation.

Contract farming can benefit local producers if the contracts are correctly structured and monitored. The Indian experience suggests the need for alternative institutional mechanisms if contracting is to be used as a development tool.

The Group of 20 (G20), which includes India and Pakistan, has emerged as a formidable negotiating bloc in the WTO. It has successfully questioned existing agricultural trade rules that hamper the interests of developing countries. However, there are crucial internal and external contradictions and pressures that it must resolve if it is to continue voicing the interests of developing countries.

Agricultural subsidies are the big sticking point in WTO negotiations. This paper traces how agricultural negotiations have played out in the Agreement on Agriculture and the July Framework. It suggests negotiating options for India in the run up to the Hong Kong Ministerial in December 2005.

Negotiations on non–tariff barriers have received little attention. Yet, as tariffs decline, NTBs will be used more to protect domestic trade. This paper explains two of the most contentious NTBs for India: Sanitary and Phytosanitary Measures and Technical Barriers to Trade.

Balanced Regional Development has remained central to our planning process. Over the years, there have been various interventions for improving the quality of life and services in the backward states. Road connectivity, right to education and its universal access, health care and nutrition and dispersal of industries have been some of the important initiatives. While there has been an increase in growth and improvement in quality of life across the States, inequality in access to services and growth has persisted.

This paper by Centad looks at the initiatives and their outcome through the construction of an Improvement Index and suggests a relook. We hope that this paper will help improving our understanding of the issues involved in balanced growth and the interventions that may be necessary.