China has introduced a new security law that adds internet under the sovereign control of the state. As per the law, internet is a matter of sovereignty and security and they should be “secure and controllable”. The new law becomes a model for state controlled internet. The National security law of China, passed by the top legislature on Wednesday extends from military to economy. It also brings space exploration and cyber security under the concern of security establishment. The new policy comes at the time of China’s increased aggressiveness in the East China Sea. In the internet world, many secretive hacking and invasions into the US military sites were
The fifty founding members of the AIIB have signed a historical Articles of Agreement (AoA) on important functional aspects, including the governing structure of the Asian Infrastructure Investment Bank. Articles of Agreement of the AIIB looks close to that of the twenty-four Articles of Agreement of the IMF that was signed seventy years back. China, the lead state has a veto power and 26% vote and 30 % capital contribution to the AIIB. It seems that China in the AIIB, is like the US in the IMF. India expectedly got the second largest voting power and capital share. India’s shareholding is 8.52% with a voting right of 7.5%. It was estimated that India’s vot
Greek PM Alexis Tsipras has announced a holiday for banks on the much anxious Monday and put capital controls. Announcing the decision on the TV, the Socialist Party leader has blamed EU for the current confusion in his economy. Capital control means restriction of taking away money to outside the country. Greek problems are now graduated to the next phase where banks may face liquidity crisis. Panic withdrawal will dry resources of the banks. Most importantly, the problem will get worsened from minute to minute. The issue of debt repayment to IMF and EU can be solved through discussion and Athens will get even weeks for it. On the other hand, the liquidity crisis in the ban
The Greek crisis whatever turn it may take in the coming days will start adversely affecting India. Much of the Greek effect will be on the stock market –producing turbulence. European institutional investors may exit from even profit scenarios in the EMEs including India to cover up liquidity shortage in their home countries. It is estimated that many European investors may undergo liquidity squeeze out from a worst case scenario of a Greek default. Similarly, a rise in yield in EU bonds may attract more speculative capital away from the EMEs to the Eurozone. Even if Athens doesn’t default, the liquidity shortage and rise in the yield of Euro zone bonds may
Lender of last resort of the Eurozone, the European Central Bank, has told that it will continue to provide liquidity to Greek banks. At the same time, the currency union’s apex authority declared that it will not increase the lending. ECB’s soothing stand came after the Greek government’s decision to conduct a referendum on July 5th on austerity measures to be adopted by Greece. Analysts observe that Greek banks may be running out of the money, especially in the context of panic withdrawals and failed talks. How Athens can avoid a Black Monday depends upon the sentiments among the public. Reports by Bloomberg news agency said that there are indirect
Ace forecaster, the RBI Governor, Raghuram Rajan has warned that too much use of monetary easing will push the world economy into Great Depression of the 1930s variety. He called for international consensus on policy making to escape from the present crisis. The global economy is "slowly slipping" into Great Depression-like problems of 1930s. He asked central banks to define "rules of the game" to find a solution. The RBI governor was speaking at seminar at London Business School on Thursday. Indirectly, he criticized the one sided policy stances of advanced central banks without considering its impact on the world economy. Already, the competitive monetary easing by the advan
Europe’s ailing but defiant economy Greece and Eruozone are in the course of a devastating conflict over the referendum announced by the Greek PM Alexis Tsipras. The Greek PM has announced a rather surprising referendum for July 5th about the austerity plan suggested by its mainly European creditors. The time cosnusming referendum shows that Greece is not politically willing to offer any commitment like austerity. Reacting to the Greek referendum move, Eurozone leaders have said that Athens has violated the negotiation process unilaterally. For the first time, the Eurozone leaders also made hints that they are thinking a European Monetary Union without Greece. Solidari
Within no time, two global institutions will start functioning in China’s Shanghai and Beijing. First is the BRICS managed New Development Bank (NDB). Second is the keenly watched development magnet that is attracting even advanced countries– the Asian Infrastructure Investment Bank (AIIB). The NDB’s (or the previously announced BRICS Bank) President nominee, KV Kamath has told that the bank will start functioning from second half of 2015. If it happens, Shanghai will host the first international organization that China hosts. But there is strong perception that China is more interested in the AIIB than the NDB. This is because of the probability of high Chine
Greece and its creditors of Euro Zone have failed to reach on any agreement in the most important talk to prevent a Greek default. The EU has called an emergency meeting of the EU state heads on the issue on Monday just eight days remaining for the Greek repayment of 1.6 billion Euros to IMF. The European Council President Donald Tusk revealed that the heads of state meeting has to find a political solution to the crisis. The President told that it is now time to “urgently discuss” the Greek crisis “at the highest political level”. Greece was demanding for a political solution while ruling out austerity measures. The Financial Times of London quoted m
Panic withdrawals of bank deposits associated with economic crisis are engulfing Greek economy like a financial tsunami. Early hours after the failure of the Luxembourg meeting indicate that people are withdrawing deposits from banks quickly. According to the Greek central bank, depositors pulled out more than 1 billion Euros on Thursday from the country’s four large banks. This means that the total withdrawal for the week is 3 billion Euros which is three times the average weekly withdrawal over the past two months. Greece’s debt commitment to IMF for this month is 1.6 billion Euros. Since the nature of the crisis has percolated into the banking system, the
Dictionary on Indian Economy
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- Why the GST reform is transformational?
- Raghuram Rajan: The Gladiator returns to Chicago
- Good intention but poor thinking - what troubles demonetization?
- India Black Money Report: CBI underestimates black money at Rs 25 lakh crore
- High interest rate rather than inflation is the macroeconomic problem for India right now
- Japan’s first trade deficit in 30 years is part of the Global Shift
- Arvind Subramanian rocks with 'Chakravyuha' in Economic Survey
- Why we need an emergency monetization plan as well?
- NREGS: give respect to the tax payer’s money