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Is Cutting UK Taxes Ahead of a General Election Affordable or Not? An...
The possibility of tax cuts in the upcoming budget is being speculated widely in the UK. But can the British economy afford them?Ensuring the Credibility of India’s GDP Estimates
Two pressing issues have reignited the debate about the credibility of India’s GDP growth rate.Commodity Prices and the Twin Balance Sheet Crisis
Abhishek Kumar and Divya Srinivasan use data from India (the second-largest steel producer in the world) to estimate the effect of large movements in metal prices during 2011-16.Bad debts of 2011-2016 could partly be pinned on a metal price crash
A majority of the firms responsible for defaulted loans between 2017-2020 constituted iron and steel businesses.Non-Performing Assets: Dented by Iron and Steel
The large decline in metal prices during 2014-16, predominantly driven by Chinese imports, made domestic firms in the metals sector uncompetitive. A decline in profitability affected the loan repayment capacity of many firms in the metals sector and they defaulted, creating non-performing assets (NPAs) for banks.A Buffer Against Banking Stress
It is advisable for banks to build a counter-cyclical commodity price buffer during upswings in commodity prices which can be used during periods of downswings.Why NPAs Are Not Just About Bank Governance
Probing the links between twin balance sheet crisis and external commodity shocks could lead to a better understanding of the problem.Bank Credit Risk and Macro-prudential Policies: Role of Counter-cyclical...
This paper investigates the impact of counter-cyclical capital Buffer (CCyB) as a macro-prudential policy, on bank credit risk, during uncertain times, as banking sector stability is crucial in promoting financial intermediation.Commodity Price Shocks and Non-Performing Assets in the Indian Banking...
Abhishek Kumar, Rakesh Mohan and Divya Srinivasan show that nonperforming assets in the banking sector and profit ratios in commodity-sensitive non-financial sectors are highly correlated with global commodity prices.What Drives Indian Inflation? Demand or Supply
In this paper, using data from a large emerging economy, Ashima Goyal and Abhishek Kumar identify a structural shock (inflation shock) that explains the maximum forecast error variance of consumer pricesMarket Volatility, Monetary Policy and the Term Premium
The authors use time-varying VAR models to study the effects of option-implied measures of equity and bond market volatilities on the government bond term premium and key macroeconomic variables.How US Demand Helped Expand Labour-intensive Manufacturing
Understanding the US-India trade composition is also important, as the US is the only big trading partner with which we have a trade surplus, says Abhishek Kumar and Divya Srinivasan.FTA with the UK can Weave Magic
An FTA with the UK can help recover ground lost to Bangladesh on textile exports because of its LDC status, say Abhishek Kumar and Divya Srinivasan.Time to Rationalise Fuel Taxes
The delayed feedback from wholesale inflation to retail inflation is also reflected in the household inflation expectations survey of the RBI.Enough of the Old ‘Level Playing Field’ Argument. Reduce Trade...
Data from the IMF's October 2021 World Economic Outlook reveals that India's real exports growth moves in tandem with the growth in global real exports. Consequently, the steep decline in India's export growth since 2018 onwards is mirrored by a decline in global export growth in general.