Insights from the Economic Survey; QIA drags Byju Raveendran to court
Welcome to Top of the Morning by Mint, your weekday newscast that brings you five major stories from the world of business. It's Tuesday, July 23, 2024. My name is Nelson John. Let's get started:
Continuing their losing streak for a second consecutive session, Indian stock market benchmarks, the Nifty 50 and the Sensex, closed in the red on Monday, July 22, ahead of the Union Budget 2024.
The Economic Survey - an annual document presenting the state of India’s economy - was tabled in Parliament on Monday, a day ahead of the Union Budget. The Survey serves as the government's most detailed analysis of the economy and plays a crucial role in shaping policy decisions. Today, let's take a look at the critical stories around the Survey, as the country prepares for the third Narendra Modi government’s first full budget.
As we look ahead to the Union Budget for 2024-25, Mint’s N Madhavan looks at the insights the Survey might offer into what may be prioritised. The Survey cautiously pegs next year's economic growth at between 6.5% and 7%. To keep this momentum, it points to several key areas. These include enhancing job and skill development, supporting small and micro enterprises, maximizing agricultural outputs, managing environmental transitions, tackling inequality, and growing the corporate bond markets. Madhavan also explains what the Survey has to present on key economic indicators.
The Economic Survey highlights a critical need for job creation in India, projecting a requirement to generate 7.8-8.1 million jobs annually up to 2036, which totals about 103 million new roles. The emphasis is not only on quantity but also on quality, as current data indicates only half of college graduates are directly employable. To address this, there has been an increase in youth receiving formal vocational education, although participation remains in the low single-digits. Informal training channels are compensating somewhat, contributing an additional 16.6% in trained youth. Read today’s Long Story by howindialives.com to understand the government’s recipe for growth in charts.
You can click on the link in the show notes to see the charts prepared by our partners at howindialives.com.
The Economic Survey 2023-24, delivered by Finance Minister Nirmala Sitharaman, emphasizes the pivotal role of the private sector in scaling up investments and spearheading job creation in an era increasingly shaped by technology and AI. The Survey critiques the private sector's investment patterns, noting a preference for real estate over sectors like machinery and intellectual property, which are crucial for transforming India into a manufacturing hub and creating quality jobs. Chief Economic Advisor V Anantha Nageswaran stresses that employment offers dignity and self-respect, urging corporates to prioritize job creation. Additionally, the Survey advocates a strategic embrace of Chinese FDI, suggesting that India can boost its export capabilities by integrating into Chinese supply chains, a strategy that has benefitted other Asian economies. This approach aligns with global trade shifts and could enhance India’s export performance, particularly to the United States. Mint’s senior editors Gireesh Chandra Prasad and Subhash Narayan write on the Economic Survey’s focus on private investment and job creation.
Qatar’s sovereign wealth fund, the Qatar Investment Authority, which has been an investor in Bengaluru-based ed-tech startup Byju’s, has taken legal action in India, demanding that founder Byju Raveendran disclose his personal assets. Mint’s startup editor Ranjani Raghavan reports that the QIA has approached the Karnataka High Court to prevent Raveendran from selling or transferring his assets, aiming to secure up to $235.19 million. QIA has been deeply involved with Byju's, having invested in 2019 and 2022. It also provided a $250 million loan to Raveendran in March 2022. He used this loan to invest back into Byju's during its last funding round, which valued the company at $22 billion. Now, QIA is seeking a court injunction to freeze Raveendran's dealings with his assets, reflecting the serious financial stakes.
The Indian government is actively preparing for a new phase of airport development under public-private partnerships. This aligns with its aim to enhance infrastructure in the rapidly growing aviation sector. Senior government officials told Mint’s aviation correspondent Anu Sharma that internal discussions are underway, with plans to open bids for several airports by the end of the financial year. This approach builds on the previous strategy of pairing major airports with smaller ones for balanced development. Currently, only 14 out of over 135 airports operate under public-private partnerships, indicating significant potential for future privatization and investment.
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Show notes:
Mint Primer: Hints on budget proposals from the economic survey
Economic Survey: The government’s recipe for growth, in 12 charts
Economy to grow at 6.5-7; time for private sector to take the capex baton: Economic Survey
Now, Qatar wealth fund goes after Byju Raveendran's personal assets