Weekly news recap - June 02, 2018

  • Where Demographic Dividends Will Pay Out Next (Bloomberg)
  • Boosting shareholder activism in Corporate India

    …the consequences of the lack of activism are depressingly apparent in India. Here, the promoter culture, with deep roots in the lost decades of the licence raj, reigns supreme. It has accreted over the years into opaque corporate control systems. …tangled webs of holding firms, subsidiaries and inter-group investments enable promoter control over listed companies that is disproportionate to their actual shareholding. Unsurprisingly, this has made it easier for investors to sell than urge course correction. That is not a recipe for the trust essential for the smooth functioning of financial markets and efficient capital allocation.

  • The Rate Debate: Will The MPC Be As Divided As Economists? (Bloomberg Quint)

    Rising core inflation is one of the factors cited by economists who say it’s time for a rate hike. Retail inflation rose to 4.58 percent in April and core inflation rose to 6 percent. The MPC’s inflation target stands at 4 (+/-2) percent, which suggests that inflation is moving away from the mid point of the target range.

    Lower oil prices starting 2014 created a ‘positive terms of trade’ shock for India. This led to a near 20 percent appreciation in the real exchange rate. Has this “impinged on the competitiveness of India’s manufacturing sector (both exports and import competitors)?, Chinoy asked. If so, then the policy response may be to allow the rupee to weaken and counter domestic inflation via higher rates.

  • Sexual Violence Is Holding Back the Rise of India (Bloomberg Quint)

    In the eight years from 2004, about 20 million women (the size of the combined populations of New York, London and Paris) vanished from India’s workforce, the World Bank estimates.

    India could increase its GDP by $770 billion by 2025 by getting more women to work and increasing equality, according to McKinsey Global Institute. Yet, only 27 percent of Indian women are in employment. That’s the lowest among the major emerging nations and G-20 countries, and better only than Saudi Arabia, according to the publication IndiaSpend.

  • India’s Biggest Competitors to Walmart and Amazon? Mom and Pop (WSJ)

    Tiny stores known as kiranas dot every Indian street, village and slum. Usually family-run, these micro-businesses range from street vendors selling vegetables to shops the size of a one-car garage. They pay low wages and have little or no rent, which helps keep costs down. And since they cater largely to neighborhood populations, many offer instant delivery, interest-free credit and other personalized services that the global giants are unable or unwilling to provide.

  • How Alibaba is planning to counter Amazon and Walmart in India (Factor Daily)