A G D
End 2014 witnessed rural
wages in India registering an
average annual growth of 3.8% in November 2014, the lowest since July 2005. Earlier rural wages in India were increasing at two-digit growth rates until June 2014, and reached peak 20% level in 2011. Inflation is coming down sharply. The 3.8% nominal growth in wages, is lower than the annual consumer price inflation of 4.09% for rural India. During the last five years, nominal rural wages had grown at a sharp pace, and the casualty had flown from wages to prices. Moderation in rural wage growth has helped anchor inflation expectations. Rural wages began going up in 2007 due to non-farm employment opportunities in a booming economy, aided by improved road and telecom connectivity. MGNERA and rising crop prices made it possible for farmers to absorb the wage increases. Over the last one year job opportunities for rural migrant workers has reduced, especially in sectors like construction and manufacturing. Falling prices of most crops has reduced the scope for transfer of wages by farmers. Further, the emphasis on MGNERA is declining.
Slow Credit Growth
Loans-to-GDP ratio has fallen by about 3% between 2011 to 2014 in India, after showing an increase of 62% from 1996 to 2013. In line with the receding economy, credit growth has been affected in the past three years. India’s gross domestic product has fallen from 8.4% (2010-11) to 5% (2013-14). In this period loans-to-GDP ratio declined to about 0.54 in 2014, from 0.55 in 2011, which amounts to a 3% fall. Banks lost the propensity to lend more, as the economic growth started falling, and banks were straddled with increasing non-performing assets. Credit growth data fell from 20% growth (2011) to 16% (2014).
Financially excluded households are households where no member of the household owns a bank account. The number of financially excluded households which remained constant at 41% (2004-2011), improved to 35% in 2014, mainly due to the large number of accounts opened between 2011 to 2014. The figures have further improved due to the on-going Jan Dhan Scheme, introduced from mid-2014. Taking one person in each household, 98% of households in India have bank accounts. However, over 75% of the newly opened accounts are not operational as yet. Introduced in August 2014, the Jan Dhan Yojana for financial inclusion, has led banks to collectively open 10.63 crore basic savings bank accounts, up to end December 2014. While 78% of these accounts are with zero balances, the remaining 2.30 crore accounts have balances aggregating Rs 8369 crore.
To Marx in China
Some analysts were fearing that Mao Zedong’s ideals have been lost in China’s wave of reforms. Recently, speaking during a meeting on ‘‘party building’’ in education institutions, President Xi said that instructing students about Marxist ideals was the responsibility of universities. He maintained that enhancing Communist Party of China (CPC) leadership and party building in the higher learning institutions is a fundamental guarantee for running socialist universities with Chinese features well. The highest position in Chinese universities is held by the party secretary. The universities are presided over by party committees. Decisions made by the committee are made by education officials. The authority of the party and influence is being widened across China. Last summer, the party started an ‘ideological education’ program in rural areas. Class room and on-line lessons help to promote the spirit and awareness of reforms among the 86.7 million ordinary members of the party. The ‘Young Marxist Training Programs’ involve work experience with a township committee. The ruling CPC party is using Marxism to nurture successors of its cause, and breed a next generation of politicians who can apply Marxism in their practical work.
Nazi Terror Weapons Site
Mid-December 2014, near the town of St Georgen an der Gusen in Austria, a vast facility of a secret underground complex was discovered. The underground site was built by the Nazis towards the end of the Second World War, that may have been used for the development of weapons of mass destruction, including a nuclear bomb. It is believed to be connected to the nearby B8 Bergkristall underground factory, that produced the Messerschmitt ME 262, the world’s first operational jet powered fighter, that posed a brief threat to allied air forces, in war’s closing stages. The Nazis in 1945 had sealed the entrance shaft, once used by large transport lorries. The US Office of Strategic Services (OSS) reported in February 1944, that a huge complex was operated near St Georgen. Under an agreement to divide Austria into allied military zones, the Americans relinquished Bergkrist all facility to the Russians in July 1945. The Russian army plundered the factory, removed all the technology, and then destroyed and filled in the bunkers. Andreas Sulzer, an Austrian documentary film maker, in charge of the excavations, discovered the second part of the site, which seems to have remained unnoticed by both the Americans and the Russians. Heavy equipment cut away thick layers of soil, as well as large granite plates, with which the Nazis in 1945 had sealed the entrance shaft. The underground maze covers an area of up to 75 acres. The factory relied on slave labour.
Vol. 47, No. 35, Mar 8 - 14, 2015