Europe: Politics takes a right turn

This piece originally appeared on Livemint.com

 

Norbert Hofer, a key figure in Austria’s anti-immigration, far right Freedom Party, narrowly missed becoming the president of the country earlier this month. It’s a ceremonial position, yet, that he came so close to the presidency is seen as an indicator of how parties similar to Hofer’s are gaining popularity across Europe.

has Alternative for Germany; France has its National Front; Netherlands, Party for Freedom; Greece, Golden Dawn; Hungary, Jobbik; and Sweden, Sweden Democrats.

The trend has been picking up for some years now, and in 2016 the noise—and the confidence—levels have gone up. The anti-immigrant sentiment came on the back of a large number of refugees landing in Europe from Muslim-majority countries in West Asia and Africa. The inflow dropped in 2016 (see chart 1) compared with 2015, but tension over their settlement and assimilation is simmering. On top of this, there is disillusionment about the European Union. Unemployment rates in two countries, Greece and Spain, are about 20%. In France and Italy, they are above 10% (see chart 2).

Economic growth has been sluggish. The mood worsened after the UK voted to leave the bloc in a June referendum (see chart 3)—in part because the results seemed to reflect the growing trend across Europe. The elections this year in at least three countries saw the right and far right parties gaining vote share (see chart 4). Unlike the sudden rise of Donald Trump in the US, the popularity of right/far right parties has been building up over years. 2017 is unlikely to be any different.

 

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News in Numbers, Dec 1, 2016: Can we replace the king?

Cash transactions rule in India. Over two-thirds of the transactions in India are done by cash, as per a report by CLSA. The government’s recent moves seem to be nudging people towards non-cash transactions. And, not all Indians are under the formal financial net yet. On Wednesday, the government appointed a panel to steer the country towards digitalisation. Will Indians be ready to embrace cashless transactions? How quickly can we do that? What about the security concerns? 


13

What is it? The number of members in a panel set up by government think-tank Niti Aayog to promote the use of digital payments.

Why is it important? It’s a part of the government’s efforts to make use of the cash crunch to turn people towards cashless payment options. Digital payments system comes with the advantages of transparency, traceability and accountability besides being faster, less inexpensive and more convenient. However, this also means battling security issues and easing concerns of consumers who may not be comfortable with the new medium. The panel consists of members from different parties, indicating that the government seeks to generate a political consensus in its push for digitalisation of the economy.

Tell me more: Andhra Pradesh chief minister N Chandrababu Naiduis the convenor of the panel, which includes Odisha CM Naveen Patnaik (Biju Janata Dal), Puducherry CM V Narayanasamy (Congress), Sikkim CM Pawan Kumar Chamling (Sikkim Democratic Front), Madhya Pradesh CM Shivraj Singh Chouhan and Maharashtra CM Devendra Fadnavis (both from the ruling BJP). Other panel members include NITI Aayog vice-chairman (Arvind Panagariya) and CEO (Amitabh Kant) and five special invitees including Nandan Nilekani, former chairman of the Unique Identity Authority of India.

40

What is it? The number of locations at which the Enforcement Directorate (ED) conducted searches on Wednesday to check black money held with currency exchanges, hawala dealers and others.

Why is it important? Indicates the government is pushing for a well-rounded attack on tracking down illegal hoarders of cash and suggests that there are ways in which some circumvent the laws, highlighting the need for their stricter enforcement. The authorities seized Rs 1.2 crore cash. The ED, which is responsible for enforcing the Foreign Exchange Management Act and the Prevention of Money Laundering Act, attached assets worth over Rs 9,000 crore for hawala and money laundering crimes in 2014-15, which is likely to go up this fiscal. However, the high pendency – 4,776 cases pending in terms of number of investigations initiated as on March 31, 2015 – is a cause of concern.

Tell me more: As many as 100 investigators along with police personnel have undertaken the searches across the country.

7.3%

What is it? India’s economic growth rate in the July-September quarter of 2016-17.

Why is it important? This is marginally higher than the rate recorded in the June ended quarter (7.1%) though slower than the 7.6% growth in the second quarter of 2015-16. It also fell short of 7.5% forecast by a Reuters poll of economists. The increase in acceleration in the second quarter this fiscal over the first was led by agriculture (compared to 1.8% in the first quarter) while manufacturing grew by 7.1% (compared to 9.1% in the previous quarter). Consumer spending, which accounts for 56% of India’s $2 trillion economy, is likely to be hit due to the recent demonetisation announcement and it remains to be seen how this affects India’s economic growth rates in the next few quarters.

Tell me more: India retains the tag of the fastest growing major economy as per the second quarter data. China recorded a growth rate of 6.7% in the quarter ended September.

32.5 million

What is it? The number of barrels of oil the Organization of the Petroleum Exporting Countries (OPEC) would produce per day from January 1. OPEC is a group of 14 major oil-exporting nations that account for a third of global production.

Why is it important? This is a cut by 1.2 million barrels per day, representing about 1% of global production and the first joint decision to reduce production since 2008. The agreement to cut production is to prop up oil prices. Due to an oversupply of oil, prices plunged from about $100 per barrel in 2014 to less than $40 per barrel this year, affecting oil-dependent economies such as Saudi Arabia. OPEC members have said they are looking at levels of $55-60 per barrel; a failure to clinch the deal may have sent oil prices down to $30 per barrel, according to analysts.

Tell me more: After the announcement, Brent crude futures, the global benchmark for oil prices, increased by 10%.

1 million

What is it? The number of Google accounts whose security has been breached since August by a new variant of Android malware, according to a report by security firm Check Point Software Services.

Why is it important? This is likely the biggest single theft of Google accounts. The malicious software called Gooligan is disguised as legitimate apps to steal authentication tokens that can be used to access data from Google Play, Gmail, Google photos, Google docs, Google Drive among others. The malware attacks 13,000 devices every day, potentially affecting those on Android 4 (Jelly Bean and KitKat) and Android 5 (Lollipop) – this represents nearly three-fourths of the Android devices in use today. About 57% of such devices are located in Asia, 19% in the Americas, 15% in Africa and 9% in Europe.

Tell me more: A device is infected when the user downloads and installs a Gooligan-infected app (from third-party app stores or malicious links), after which data about the device is sent to the campaign’s Command and Control server. This is followed by the malicious software rooting the device (unlocking the operating system) after which it downloads a module that allows Gooligan to steal information, install apps from Google Play and rate them and install adware to generate revenue.

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News in Numbers, June 1, 2016: UP’s entry tax, impact of no discounts on online shopping…

7.9%

What is it? India’s economic growth rate in the January-March quarter of 2015-16.

Why is it important? With this, India retains the tag of the fastest growing major economy in the world for the second consecutive year. The growth has mainly been driven by a rebound in agriculture, improved government spending and private consumption, though companies are reluctant to make investments – putting the burden of boosting growth on the government.

Tell me more: India’s economy grew 7.6% in 2015-16 compared to 7.2% in the previous year. It also became a $2 trillion economy based on Tuesday’s exchange rate ($1 = Rs 67.26).

 

5%

What is it? The entry tax imposed by the Uttar Pradesh government on goods purchased from e-commerce sites.

Why is it important? This decision is said to be done to protect offline retailers’ profits due to the new-age e-commerce firms. Industry lobby Nasscom has opposed similar moves by states (such as Assam, Uttarakhand, Bihar and Rajasthan) on the basis that it puts additional burden on customers and SME traders, besides increasing technology upgradation costs of e-commerce firms to accommodate these new levies, which would anyway become redundant once the Goods and Service Tax is implemented.

Tell me more: Flipkart, through its logistics arm eKart, has filed a writ petition in the High Court of Uttarakhand opposing the state’s move of imposing 10% entry tax on goods bought through e-commerce sites whereas the standard entry tax rate is 5%.

 

175 million

What is it? The estimated number of online shoppers in India by 2020, according to a report by Google and consulting firm A.T. Kearney.

Why is it important? This would account for a quarter of the total organised retail sales in four years, up by 10% from the current level. The growth, estimated at over 40% each year, will happen even if e-commerce firms decided to do away with discounts.

Tell me more: A third of the estimated 175 million shoppers are likely to drive two-thirds of online purchases.

 

15 lakh

What is it? The approximate number of students in Industrial Training Institutes (ITIs) who will be considered Class XII pass, as per a government announcement.

Why is it important? This makes formal and vocational streams of education equivalent, providing the opportunity to the ITI students to pursue higher education and get better jobs. The ITI graduates will get Class XII (if a student has passed Class X before joining the ITI) and Class X (if a student has passed Class VIII before joining the ITI) certificates from the national board of open schooling by giving an exam.

Tell me more: There were 13,105 ITIs as of May 2016, which is to be increased to 18,000 by September this year.

 

0.5%

What is it? Krishi Kalyan cess to be imposed on all taxable services with effect from today, taking the effective rate of service tax to 15%.

Why is it important? The cess, which is to be used for agriculture and for improving the wellbeing of farmers, is likely to help the government garner Rs 5,000 crore in the remaining 10 months of 2016-17. This would make some services including air and rail travel, mobile bills, eating out in restaurants, health check-ups, movie tickets, insurance policies, private tuition and coaching centres and some banking services more expensive – an extra spend of Rs 5 for every Rs 1,000 spent.

Tell me more: The cess, which is to be levied on the value of the service and not on the component of service tax (similar to Swachh Bharat cess) will apply to bills generated before June 1 but paid from today.

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News in numbers, Mar 8, 2016: India’s growth forecast, Indian Railways’ likely cost savings…

7.7%

What is it? India’s estimated economic growth in 2016-17, according to Fitch Ratings. It has kept its forecast of 7.5% growth for the current fiscal unchanged.

Why is it important? This is lower than its December forecast of 8% growth, which was done based on the Indian government’s increased capital expenditure and implementation of reforms. A gradual economic recovery in 2016-17 and 2017-18 would be due to higher disposable income (assuming a normal monsoon after two years of drought) and the implementation of the Seventh Pay Commission payout for central government employees, Fitch said in its latest report.

Tell me more: The ratings firm observed that the government has been finding it difficult to pass legislative reforms due to its weak strength in the Rajya Sabha and that it has continued to implement executive reforms.

43%

What is it? Share of women in the working-age group that do domestic work in India, according to a report by research and advocacy organisation, Centre for Equity Studies.

Why is it important? Domestic work is considered to be unproductive, which does not have monetary benefits and is excluded from government policies. The report says due to social status and poverty, women from traditionally marginalised groups fall prey to exploitative labour arrangements to provide cheap labour. The previous government under UPA was considering a proposal to make it mandatory for men to compensate their wives for housework, which was heavily debated.

Tell me more: The proportion of women in formal labour workforce is around 27%, less than half of that in developed countries such as the United States and Britain.

~ $1.076 trillion

What is it? Amount countries spent on importing food in 2015, according to the United Nation’s Food and Agriculture Organization (FAO).

Why is it important? This is 20% lower than $1.345 trillion recorded in 2014, the first drop in five years and marginally (0.8%) less than FAO’s forecast in October. The twin reasons of bumper harvests and low oil prices (resulting in lower transportation costs) are the main factors behind the drop. Analysts say lower food costs would help large importers in the Middle East and Africa regions but a depreciation of their local currencies against the US dollar could offset the gains.

Tell me more: In October, FAO had said that lower commodity prices could affect farmers’ profits leading to lesser investment in agriculture.

Rs 10,000 crore

What is it? Indian Railways’ likely cost savings in 2015-16, according to Railway Board’s Financial Commissioner S Mookerjee.

Why is it important? This is about 15% higher than the expected cost savings announced in this year’s Budget. Mookerjee said the loss-making Indian Railways plans to implement various initiatives to cut costs over the next five years. This includes importing crude oil and taking on lease refining capacity from oil marketing costs to cut down on diesel inventories. Indian Railways spends about 18% of its net ordinary working expenses on diesel consumption.

Tell me more: Another measure is exploring the opportunity of exporting 10% of rolling stock production (freight wagons, locomotives) to be exported to make its production facilities self-sustainable.

50

What is it? Number of women employees at ICICI Bank who are part of its pilot programme called iWork@Home project, which allows them to work from remote locations.

Why is it important? Following an internal survey at the country’s largest private sector bank, MD and CEO Chanda Kochhar says they found out that women quit their jobs to take care of their children or due to long commutes. This initiative, which uses face recognition technology and extended secure networks, allows employees access to the core banking servers from their laptops.

Tell me more: The bank expects around 500 women to be working from home soon and has already received 125 requests. Less than a third of ICICI Bank’s 73,000 employees are women.

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