1 Is India growth exaggerated? (Soutik Biswas on
BBC) Last week, India announced growth figures which would make the world
envious. Asia's third-largest economy grew 7.5% in the three months ending in
March, higher than the previous quarter and above expectations. Forecasts were
for growth of about 7.3% for the period compared with a year earlier.
But the new figures have come at a time when Indian
companies are at their weakest in two years. Earnings are flat and profits are
down. Most major industries, including infrastructure and automobiles, are
struggling. Historically, when India's growth has hit 7.5% at constant prices,
corporate revenues and profits have soared above 14% on average. So how does
the economy grow so fast when corporate growth is so slow?
A month after the government declared a new way of
calculating GDP, India baffled experts in February when it announced 7.5%
growth between October and December compared with the same period a year
earlier. The latest figures again raise questions about the new way.
Economists such as R Nagaraj say the new and higher
figures "seem quite at odds with other economic indicators such as growth
in bank credit, the index of industrial production and corporate
performance". Even the government's Economic Survey earlier this year
found the new growth figures "somewhat puzzling" when compared to the
falling savings, investments and exports.
India's economy is a complex beast. There's a
thriving "underground" or black economy which evades taxes, while
more than 90% of India's workers are employed by small businesses which employ
less than 10 workers. Economist Arvind Virmani calls this India's "growth
puzzle". He says this can be explained by the "extremely dualistic
nature of the Indian economy". On the one hand, it has a small organised
sector comprising mainly large state-run companies. On the other, it has a large,
unorganised and informal sector, catering exclusively to its vast domestic
market.
Dr Virmani says the collapse of global demand and
excess capacity in goods and services have had a negative effect on globally
integrated industries in all countries. "In India it means certain high
quality, high skill segments of the organised, corporate sector. Thus Indian
corporate sector growth is likely to lag, rather than lead India's growth
recovery."
2 Slow productivity growth as a global problem (Sam Fleming
& Chris Giles in Straits Times) Even as US manufacturers adopt automation
as part of their fightback against offshoring to Asia, productivity growth
across the economy is at a near-standstill. A similar picture is being played
out across the world, exposing the most pressing problem in the world economy
today.
Only India and sub-Saharan Africa seem to be immune
from slowing productivity growth. Economists are increasingly alarmed because
slower improvements in efficiency will lead to a fall in living standards and
less solid public finances. Weakness in productivity growth in recent years
lies at the heart of why advanced nations have remained in a low-growth rut
since the financial crisis, even as unemployment has fallen.
New data from The Conference Board think-tank show
that average labour productivity growth in mature economies slowed to 0.6 per
cent last year from 0.8 per cent in 2013, as a result of ebbing performances in
the US, Japan and Europe. Faced with rapidly ageing populations and slowing
employment growth, mature economies need to boost productivity sharply if they
are to escape stagnating living standards.
In the US, productivity growth began to ebb in 2005.
Even in emerging economies, where efficiency is catching up, the rate of growth
has slowed. Optimists counter that it is just a matter of time before we see an
upsurge in productivity, pointing to innovation in American IT hubs such as
Silicon Valley.
Some argue that the easiest targets for
technological progress have already been met. But others say the world is on
the cusp of a machine-driven growth spurt, where driverless cars and robots
will replace people. Without a return to the former productivity patterns in
advanced economies, growth will be permanently lower, as will government
revenues.
3 The art of networking (Rasheed Ogunlaru in The
Guardian) A ComRes poll for the British Library shows that 62% of British
adults have never attended a networking event. And if we do try to network, we
don’t enjoy it – half of those surveyed (51%) describe feeling uncomfortable
while networking.
Despite these anxieties, the research demonstrates
that networking works. With input from some of our British Library ambassadors,
here’s some advice to help you get over your fears and start networking
effectively:
Entering a room full of strangers can be a difficult
experience. Be prepared and have a strategy to help you focus. Before you go,
list the types of contacts, connections, support and suppliers that you need,
and check if anyone will be there who can help you. Networking is not about
coldly going out, shoving business cards into people’s hands and selling. Serial
entrepreneur Shazia Awan says: “Networking should be about building a quick
rapport – it should be informal, brief, interesting and leave people wanting to
know more.”
Of those surveyed, 51% felt anxious about not
knowing anyone and 42% were worried about introducing themselves to new people.
There are tried-and-tested tactics here, for example going through the list of
attendees in advance and having a short elevator pitch of who they are and what
they do but the most effective way is to bite the bullet, and get talking.
Be a connector and an introducer and help others – opportunities
will often follow. Awan says: “People will always remember who pointed them in
the right direction, who put them in touch with someone useful and if and when
the time arises they will happily do the same for you.” And finally, follow up,
and follow up promptly, or risk losing all of your hard work.
No comments:
Post a Comment