Did developing countries really recover from the Global Crisis? C. P. Chandrasekhar and Jayati Ghosh

We are nearing the tenth anniversary of the collapse of Lehman Brothers in the United States that sparked a Global Financial Crisis,affecting every economy in significant ways. That crisis generated extraordinary monetary policy responses in the advanced economies, with low interest rates and unprecedented expansion of liquidity, in an effort largely driven by central banks to keep their economies afloat. By contrast, expansionary fiscal policy was barely used after the first initial stimulus. In the event, even with these incredibly loose monetary policies, the advanced economies have generally spluttered along, with periodic hopes of recovery dashed by repeated slowdowns –…

‘Riskless Capitalism’ in India: Bank credit and economic activity Rohit Azad, Prasenjit Bose and Zico Dasgupta

The Indian growth story of the 2000s’ cannot be over-simplistically explained as a result of “market-oriented” reforms. Public sector bank credit-financed investments, particularly in the infrastructure sector, played a significant role in sustaining growth, most crucially after the global economic crisis. Such a growth trajectory, however, proved to be unsustainable with the expansionary phase coming to an end in 2011–12 and bad loans piling up in the banking system. Riskless_Capitalism  (Download the full text in PDF format) This article was originally posted in Economic & Political Weekly on August 5, 2017.

Revised Version of India’s New Model Bilateral Investment Treaty Andrew Cornford

Introduction The initial 2015 draft of a new model Indian bilateral investment treaty contained stringent provisions concerning the definition of investment covered, non-applicability, the obligations of the two parties in the case of claims, and exceptions. [The initial draft was reviewed in SUNS 8094, 17 September and SUNS 8095, 18 September]. These provisions were criticised at the time as likely to hinder foreign direct investment and thus as counterproductive. Revisions of the model in a new draft have introduced greater flexibility under some but not all of these headings and have also included some extensions of rules in the initial…

Fragile Foundations: Foreign capital and growth after liberalisation C.P. Chandrasekhar

The shift from debt-financed public expenditure to debt-financed private expenditure-led growth in India has resulted in increased dependence on foreign capital and vulnerability. Fragile_Foundations (Download the full text in PDF format) (This article was originally published in the Social-Scientist dated Jan-Feb 2013.)

David Cameron’s Bad Date in Delhi Jayati Ghosh

Suddenly India is being wooed again. In the space of a few days, both François Hollande and David Cameron have turned up on its doorstep with palms outstretched in the search for business contracts. It will have come as a soothing balm to an Indian government facing increasing disillusion at home and growing cynicism on the part of investors abroad. In their foreign dealings, Indian policymakers must feel as if they are on a seesaw with changing partners of varying weights on the other side. There was a period, especially in the last decade, when theyIndia's policymakers could do no…