There are two aspects to the news- knowing the headline and understanding the intricacies of it. We at The Connectere focus on both. While The First Forum edition gives a brief about the headlines, The Weekly Analysis Edition is meant to educate the reader on what do various news mean and what are their intricacies. This initiative is meant to educate the reader on how to understand the important news. In the Twenty-ninth Edition we are covering the following news:
- Indian economy to contract by 12.6% in Q2, need 1991 like reforms: NCAER
- PM takes swipe at China, questions UN role in pandemic
- Analysing the Biden v. Trump debate
- Political change in Kuwait following emir’s death
- Azerbaijan-Armenia conflict
The National Economic Research Council (NCAER) has indicated that the Indian economy will be contracted 12.6% for the current financial year, a sharp decline from the 1.2% growth rate estimated in June.
Economic growth will continue to deteriorate for the rest of the financial year, said the Quarterly Review of the Economy reports for the July and September quarters, released on Friday. The second quarter will see a contraction of nearly 12.7%, followed by a decrease of 8.6% in the third and a 6.2% decline in the fourth quarter, the report said.
Highlighting the uncertainty of long-term vision, it said, “The key question is how the economy will function afterwards. Indications for V-made recovery, etc., obfuscate more than what they reveal. ”
India’s GDP is unlikely until the end of 2022-23 to reach the high exit levels seen in the last financial year, it says, noting that this was below the “expectation” of 7% growth in FY22. “The most likely scenario is that after returning to the highest level of exports by 2022-23 the economy will return to pre-epidemic growth of 5.8%,” the NCAER said.
The report showed inflation for the second quarter by 6.6% and a slight decrease of 6.5% in the financial year, both across the Reserve Bank of India band of 2-6%. Combined with extreme economic downturns, this has made the traditional approach to monetary and fiscal policy inadequate to address the problem, it said.
On the financial side, it estimates a combined deficit of 13% of gross domestic product, as well as a total public sector loan demand of 14-15% of GDP. This will put pressure on the RBI, which must empower markets to embrace this huge demand for borrowing while avoiding rising bond yields. “It seems inevitable that at least half of these loans will have to be repaid in order to avoid overcrowding and overcrowding in the financial markets,” the report said.
This calls for a series of reforms that “wished to surpass the 1991 revolution”, the tank said. The government should focus on maintaining financial stability through strong monitoring of banks and financial institutions, it said.
It has called for the realization of non-performing assets through the creation of a bad bank, incomplete investments and management changes in public sector banks and incentives that work better to make loans for small, medium and micro-enterprises.
At a time when relations with China have weakened as a result of the Ladakh crisis, Prime Minister Narendra Modi took a decision on Saturday on Beijing debt negotiations, saying India was strengthening its development cooperation without “mala fide intention” to make the partner country “dependent or hapless”.
He also questioned the UN’s role in the epidemic as he pushed for change in the organization and stressed India’s commitment to play a greater role in managing the global crisis.
Speaking in about China-Pakistan relations, the Prime Minister told the United Nations General Assembly that any act of Indian friendship in one country should not be directed at any third country.
This is a strange, strong public suspicion made by the Prime Minister over China’s outstanding debt debts with President Xi Jinping’s Belt and Road Initiative, especially in the Indian subcontinent.
In a carefully crafted 22-minute speech at UNGA, the Prime Minister, stated: “Any gesture of friendship by India towards one country is not directed against any third country. When India strengthens its development partnership, it is not with any mala fide intent of making the partner country dependent or hapless.”
He said India “always thought of the interests of all human beings and not of its own interests”. This philosophy, he said, has always been a driving force in India’s policies.
“From India’s Neighborhood First policy to our Act East Policy, and the concept of Security and Growth for All in the Region, or our ideas for the Indo-Pacific region, we have been working for the common good, and not for our own interests. India’s co-operation is always guided by this policy, ”he said.
While the world is watching China’s strong rise in the newly expanded world, Modi said, “While we are strong, we have never threatened the world, while we are weak, we have never been a burden to the world.”
As India was due to take up a permanent position in the United Nations Security Council from January 2021 for a period of two years, the Prime Minister confirmed, “India will always speak out in support of peace, security and prosperity.”
He reiterated New Delhi’s commitment to the fight against terrorism but placed it in a broader context. “India will not hesitate to raise its voice against the enemy of humanity, the human race and human values - this includes terrorism, smuggling of illegal weapons, drugs and money laundering.”
He also mentioned the Covid-19 epidemic to make the point that changes to the UN are urgently needed.
He reaffirmed India’s commitment, determination and ability to share responsibility at the international level at a time like this.
“We have never hesitated to discuss our developmental experiences. Even in these critical times of the epidemic, the pharmaceutical industry in India has exported essential medicines to more than 150 countries, ”he said.
“As the world’s largest vaccine producer, I want to give further assurance to the international community today. Vaccine production and delivery of the drug will be used to help everyone in the fight against this scourge. In India and in the surrounding area, we are moving forward with the phase 3 clinical trial in India. India will also assist all countries in increasing their capacity to freeze and maintain the supply of vaccines, ”he said.
Seeking change at the UN, he said, “One could say that we have successfully avoided the Third World War. But we cannot deny that there have been many wars and many civil wars. Several terrorist attacks have rocked the earth, and rivers of blood have continued to flow. ”
“Today, the people of India are worried about whether this revolution will reach a logical conclusion. How long will India be kept outside the United Nations decision-making bodies? ”He asked.
As the world waits with bated breath for November’s US Presidential elections, this Tuesday gave us a slight glimpse into what the competition could turn into. President Donald Trump decided to bring his chaotic and confrontational style directly to the debate stage at his first face-off with Democrat Joe Biden, which can be considered one of the low points in U.S. presidential debate history. On the other hand, Democratic candidate Joe Biden was alert, cogent and largely efficient against his challenging opponent.
US President Donald Trump repeatedly interrupted Joe Biden but Biden made a point of keeping his focus on the voters. Trump, by contrast, kept things focused squarely on himself. Biden did manage to land a few blows on his opponent, calling Trump a “clown,” “the worst president in US history,” and “Putin’s puppy”, something that he is not accustomed to.
Trump had a decent argument to make about Biden having spent 47 years in politics without leaving a distinct mark, but to pull this off, Trump needed a clear grasp of the Biden record in office and apparently that was some research work he wasn’t willing to do. Instead, Trump’s performance was all about filling the gaps in his knowledge with insults, taunts, and empty promises. He even declined to explicitly disavow White supremacists, which was probably his biggest miscue of the night given the present scenario in all of America. Biden offered some of his best answers of the night on issues like voting rights and the president’s tax returns and an emotional tribute to his son, Beau.
Investors who are already concerned that the election might not be easily settled and that lawmakers in Washington will remain too divided to pass another stimulus deal will now need to interpret a historically chaotic night. Assets ranging from currencies and gold to stocks and interest rates were already reflecting an unusual potential for sharp moves around and after Election Day.
Polls have shown that the president can’t win re-election with his base alone, that is, he needs to win the favour of college-educated, suburban, and female voters who are already dismayed by the controversies of his first term and this debate didn’t help any of it. For viewers at home, there’s only one word for the unnerving display – chaotic.
Kuwait’s Emir Sheikh Sabah al-Ahmad al-Sabah passed away at 91, plunging his country into mourning for a leader regarded by many Gulf Arabs as a savvy diplomatic operator and a humanitarian champion. He had ruled the wealthy oil producer since 2006, and steered its foreign policy for more than 50 years. Even Prime Minister Narendra Modi termed him a “beloved leader” of the Arab world, a “close friend” of India and a “great statesman” of the world.
He had endeavoured to balance relations with Kuwait’s bigger neighbours, forging close ties with Saudi Arabia, rebuilding links with former occupier Iraq, keeping an open dialogue with Iran and kept strong ties with the United States.
Under Kuwait’s constitution, the crown prince, his half-brother, Prince Sheikh Nawaf al-Ahmad al-Sabah will automatically become the emir. His succession is not expected to affect oil policy or foreign investment strategy through the Kuwait Investment Authority, one of the world’s biggest sovereign wealth funds. However, this political change comes at a time when the country faces a financial crisis worsened by internal political bickering. He had been serving as acting head of state since July.
Presently, Kuwait is facing the highest budget deficit in its history, brought on by the drop in oil prices and the coronavirus pandemic. A potential solution to its brewing liquidity crisis has been blocked by parliamentary opposition to a law that would allow the government to borrow, as other Gulf nations have done in response to the dual crisis.
A major possibility under this new leadership is a domestic political landscape change, particularly if Sheikh Nawaf makes a bid for national reconciliation. This could help restore some balance among the different branches of the ruling family.
Although Kuwait is the only country in the Gulf where nationals get to voice their opinions on how they’re governed, the political paralysis means it’s been left behind by less democratic neighbours like the UAE. Since political parties are banned there’s no coherent opposition. He recently received proposals for political and economic reforms from two opposition politicians. The opposition has boycotted parliamentary polls since December 2012 which followed one of the biggest opposition rallies in the nation’s history as the government was called to share more power with the elected leaders.
The cold war ended in 1991 with the fall of the Berlin Wall and the dissolution of the Soviet Union. However, remnants of the Cold War still remain and resurface now and again, the most recent one being the Armenia-Azerbaijan conflict, both former Soviet states that clashed over Nagorno-Karabakh internationally recognized as a part of Azerbaijan. The conflict over the American controlled enclave has been going on for three decades now.
The recent conflict started with Armenia claiming that Azerbaijan opened air and artillery attacks on Nagorno-Karabakh, whereas Azerbaijan claimed it is a counteroffensive in response to military actions. The number of civilians that have been killed is on the rise, with both sides reporting casualties. The important point, however, is that the conflict has the potential to attract NATO allies such as Turkey and Russia which might upscale the conflict. Turkey has long been a staunch supporter of Azerbaijan: Ankara and Baku share close cultural ties, given their shared Turkic heritage. Meanwhile, Turkey and Armenia have a long history of tensions, exacerbated by Ankara’s refusal to recognize the 1915 Armenian genocide as well as the Nagorno-Karabakh conflict. The latter prompted Turkey to seal its border with Armenia in 1993, which has remained shut ever since. The two countries do not have diplomatic relations. Russia plays a more ambiguous role in the region, maintaining close economic ties with Armenia and Azerbaijan and supplying weapons to both. Its relationship with Yerevan is deeper, however — Armenia hosts a Russian military base and is part of the Moscow-led Eurasian Economic Union.
Then there’s the region’s role in the global energy trade: The pipelines connecting Azerbaijan with Turkey are crucial for the European Union’s oil and natural gas supply — and pass close to Nagorno-Karabakh.
Let us go back to what started the conflict? Even though Armenia is majority Christian and Azerbaijan is majority Muslim, this conflict is not based on religion, rather we can give credits for this one to former Soviet leader Joseph Stalin. He placed the majority Armenian region of Nagorno-Karabakh into Azerbaijan. Post the disintegration of the Soviet Union, Nagorno-Karabakh became the bone of contention between Armenia and Azerbaijan, with the ethnic Armenians declaring independence in 1991 leading to a war between the two nations. These days, the United Nations still recognizes Nagorno-Karabakh as part of Azerbaijan’s territory; no country considers the enclave an independent country — not even Armenia, which also hasn’t formally annexed it but supports the region financially and militarily. Since then, the two countries have hunkered down on either side of a line of control marked by landmines and snipers.
It’s too early to say how long the fighting will continue or whether it could escalate into a full-blown war. Both the 2016 clashes and the skirmishes in July lasted only a few days. The picture would change significantly if a major power were to enter the conflict — yet even Turkey has so far limited its involvement to rhetoric. Armenia has claimed Ankara has redeployed fighters from northern Syria to Azerbaijan, but Baku issued a swift denial.