The article says: ".....Without that, however, states’ own investments have fallen considerably since FY 2022, from 2.11% to 1.92% of GDP...."
Since theres a revenue deficit of 0.7%, meaning states are unable to even afford salaries, pensions etc., this capital outlay of 1.92% if also coming from borrowings?
I couldn't agree more with your analysis of the current prospects for India. It is deplorable that politicians have been given the right to decide everything in India, and promptly take decisions that only benefit themselves -- never their electorate as a whole. Another truth that the Indian experiment with democracy has unearthed is that our legislators simply cannot cooperate with each other. They ignore good recommendations and useful warnings, and excel at heckling and squabbling with each other at every turn, something that is shameful to see. As such, our attempts to move ahead are doomed from the start.
I believe that a good first step in India would be to teach everyone English, and make our teaching methods and teacher training world-class. That way, the peoples of our vast population would at least understand each other a little better. I have seen its transformative power in South East Asia, where they have openly acknowledged the need for English, and embraced best practices in foreign language learning. With a common language base, the systems and syllabi in education here will definitely move and work more easily.
To make manufacturing as attractive as the service sector, we must bridge the "lucrativeness gap" by offering direct wage subsidies or tax breaks for technical roles, ensuring take-home pay is competitive with IT. Beyond salary, factories need to be rebranded as high-tech "production hubs" by integrating automation to reduce manual drudgery and building modern, tech-park-style campuses. By linking financial incentives (like PLI schemes) to workforce upskilling and creating clear, prestigious career ladders—similar to the German apprenticeship model—manufacturing can finally attract the top-tier talent currently drifting toward services. This is urgently the need of the hour.
"'.......... This is perhaps what caused the Rupee to drop 6.5% in value between April 2025 and January 2026. Such a drop, in turn, can push foreign capital out — making it harder to fund the gap......."
But depreciation of currency makes imports from India cheaper for other countries and can increase FDI inflow? Why do you say it pushes foreign capital out?
Just to confirm,
The article says: ".....Without that, however, states’ own investments have fallen considerably since FY 2022, from 2.11% to 1.92% of GDP...."
Since theres a revenue deficit of 0.7%, meaning states are unable to even afford salaries, pensions etc., this capital outlay of 1.92% if also coming from borrowings?
Madhya pradesh government has budgeted and marked all of its borrowing this year to pay of the interest of old borrowing. No new money is available.
I think this capital outlay is the money allocated by center to state for capex.
I couldn't agree more with your analysis of the current prospects for India. It is deplorable that politicians have been given the right to decide everything in India, and promptly take decisions that only benefit themselves -- never their electorate as a whole. Another truth that the Indian experiment with democracy has unearthed is that our legislators simply cannot cooperate with each other. They ignore good recommendations and useful warnings, and excel at heckling and squabbling with each other at every turn, something that is shameful to see. As such, our attempts to move ahead are doomed from the start.
I believe that a good first step in India would be to teach everyone English, and make our teaching methods and teacher training world-class. That way, the peoples of our vast population would at least understand each other a little better. I have seen its transformative power in South East Asia, where they have openly acknowledged the need for English, and embraced best practices in foreign language learning. With a common language base, the systems and syllabi in education here will definitely move and work more easily.
To make manufacturing as attractive as the service sector, we must bridge the "lucrativeness gap" by offering direct wage subsidies or tax breaks for technical roles, ensuring take-home pay is competitive with IT. Beyond salary, factories need to be rebranded as high-tech "production hubs" by integrating automation to reduce manual drudgery and building modern, tech-park-style campuses. By linking financial incentives (like PLI schemes) to workforce upskilling and creating clear, prestigious career ladders—similar to the German apprenticeship model—manufacturing can finally attract the top-tier talent currently drifting toward services. This is urgently the need of the hour.
"'.......... This is perhaps what caused the Rupee to drop 6.5% in value between April 2025 and January 2026. Such a drop, in turn, can push foreign capital out — making it harder to fund the gap......."
But depreciation of currency makes imports from India cheaper for other countries and can increase FDI inflow? Why do you say it pushes foreign capital out?
I’m new to this platform and came across your writing by chance.
Subscribed after reading a few pieces - thoughtful work.
Incidentally, my entire portfolio is with Zerodha, and the experience has been good.
Glad to be here.