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Unemployment Rate In The Country Drops To 1-Year Low In September

That’s the lowest reading since September last year. Rural unemployment dropped to 6.20%, from 7.11% in August, while urban unemployment rate fell to 8.94% from 10.09% in the same period

By Govindraj Ethiraj
New Update
Unemployment Record Rate Drop
On today’s episode, financial journalist Govindraj Ethiraj talks to Vijay Setia, former President of the All India Rice Exporters Federation and also Chairman and Managing Director of Chaman Lal Setia Exports (makers of the well known Maharani Basmati Rice brand) as well as Siraj Hussain, former Agriculture Secretary to the Government of India and frequent columnist on agricultural and food production issues. 

Our Top Reports For Today

  • 00:00 Stories Of The Day
  • 00:50 Unemployment rate in the country drops to 1-year low in September.
  • 06:38 India’s Rice Export Ban draws WTO ire, Indian exports are holding out.
  • 17:05 India swings between excess and scarcity on food produce, are there lessons from the past ?
  • 26:38 Google Chromebooks to be made in India by HP now

NOTE: This transcript contains only the host's monologue and does not include any interviews or discussions that might be within the podcast. Please refer to the episode audio if you wish to quote the people interviewed. Email [email protected] for any queries.


Unemployment Rate Drops

The link between unpredictable monsoons and the agricultural economy has been reducing over the years.

Another indicator of this was India’s unemployment rate which dropped to a one-year low in September as joblessness in rural areas fell despite weak monsoon rains. 

Overall joblessness rate slid to 7.09% last month, from 8.10% in August, data from private research firm Centre for Monitoring Indian Economy showed, according to Business Standard.

That’s the lowest reading since September last year. Rural unemployment dropped to 6.20%, from 7.11% in August, while urban unemployment rate fell to 8.94% from 10.09% in the same period.

Urban joblessness also saw a dip ahead of the key festival season in India. Employers usually gear up on hiring — especially in the gig and contract employment segment — ahead of Diwali, the festival of lights in November. 

Stock and other markets

Meanwhile, the stock markets and other markets were shut yesterday because of Gandhi Jayanti so no fresh news there.

No major cues appeared overnight apart from 10-year Treasury yields in the US rising to the highest since 2007. Treasury 10-year yields rose more than six basis points to 4.64%.

Money is obviously rushing into US treasuries and out from elsewhere.

Speaking of rushing out, after sustained buying in the last six months, FPIs have turned net sellers and pulled out of over Rs 14,767 crore from Indian equities in September, primarily due to dollar appreciation, steady rise in the US bond yields, and a spike in crude oil prices, the Business Standard is reporting.

Before the outflow, FPIs bought Indian equities in the last six months and brought in Rs 1.74 lakh crore during the period.

We are as you know tracking oil prices quite closely for, among other things, the domino effect it might have.

Meanwhile, Reuters is reporting that Asia's crude oil imports slipped for a second consecutive month in September as refinery maintenance trimmed demand and the impact of higher prices started to weigh.

Arrivals of 24.95 million barrels per day (bpd) in September, down from August's 25.22 million bpd, said Reuters.

Refineries currently undertaking scheduled maintenance are units at Reliance Industries' (RELI.NS) 1.24 million bpd complex in Jamnagar in India and plants in  Vietnam, South Korea and Taiwan's CPC.

The rupee which has been weak appreciated on Friday by 13 paise to close at Rs 83.06 to the dollar. There is no clear trend from this of course, not at least at this point.

Meanwhile, as long as America continues to spend or buy, the global economy benefits, at least in a manner of speaking.

The WSJ says American are still spending like there’s no tomorrow with concerts, trips and designer handbags taking priority over saving for a home or rainy day.

Interest rates are up. Inflation remains high. Pandemic savings have shrunk. And the labour market is cooling.  

Yet household spending, the primary driver of the nation’s economic growth, remains robust. Americans spent 5.8% more in August than a year earlier, well outstripping less than 4% inflation. 

But there is an important difference this time.

This time it's an experience economy boom this summer or services rather than products. 

Delta Air Lines  for example reported record revenue in the second quarter and Ticketmaster sold over 295 million event tickets in the first six months of 2023, up nearly 18% year-over-year. 

One young 30-year-old NY based marketing professional WSJ spoke to said,

He bought a $1,600 Taylor Swift Eras Tour ticket and then he spent $3,500 on a bachelor party trip to Ibiza, Spain.  He and his fiancée also rent for $3,000 a month and would cost a million dollars to buy.

“I might as well just enjoy what I have now,” he told the WSJ. 

Some commercial real estate news.

Speaking of renting, real estate is one area, commercial or residential where there is a clear and mostly upward trend back home, more in residential of course.

In the commercial space, The net leasing of office space in the top seven cities in India increased by 5 per cent to 10.37 million square feet (msf) in July-September, despite global headwinds, real estate consultancy JLL India said in a report quoted by Business Standard.

Mumbai however saw a reduction in net leasing of office space to 1.53 msf during the third quarter of this calendar year, down from 1.83 msf in July-September of the previous year.

However, in the first nine months of FY24, the absorption of office space was 13.9 percent lower compared to the same period last year.

Hyderabad led with the highest market share of 26.1 per cent, followed by 22.9 per cent in Bengaluru and 16.4 per cent in Delhi-National Capital Region (NCR). 

US, WTO bring up rice exports ban at meeting

The United States last week called India’s export ban on non-basmati rice an “unnecessary trade barrier” while asking for its immediate withdrawal at the World Trade Organisation or WTO agricultural committee meeting.

India had earlier imposed a ban on non-basmati rice exports on July 20 and followed that up with a ban on lower price basmati rice as well. 

The move shocked global rice markets and set off panic alarms, including among NRIs world over who, like in India, use non-basmati rice for daily consumption as opposed to the flavourful basmati which is more used for special meals including biryanis.

India’s non-basmati rice exports are now down about 90 per cent year-on-year in September or rather just 10% as compared to last year, a New Delhi based exporter told the Hindu BusinessLine.

India has responded to the WTO charge by saying that the new ban was a regulation rather than a restriction, which was crucial for the food security of its 1.4 billion people, The Hindu Business Line reported.

“India pointed out at the WTO agriculture committee meeting on Wednesday that it granted exemptions from the export ban to those in need upon their governments’ request and was committed to ensuring food security in those countries,” a Geneva-based trade official told Businessline.

A group of WTO members led by the US said that India’s export ban had a detrimental impact on countries heavily reliant on imports, particularly during times of crisis, as it accounted for roughly 40% of global exports. 

Meanwhile, India is now supplying to some countries like UAE, Bhutan, Mauritius and Singapore, on a country to country basis which it said it would do a month ago.

More than 2 and a half months down, where do we stand on rice exports and what have been the takeaways so far, on supply, demand and on prices ?

Also, how has basmati rice been faring in this period, including in terms of demand.

I spoke with Vijay Setia, former President of the All India Rice Exporters Federation and also Chairman and Managing Director of Chaman Lal Setia Exports, makers of the well known Maharani Basmati Rice brand.


On Agricultural policy

Moving on from cereals which is rice to other food products including fruits and vegetables.

In just 6 weeks, we went from record prices for Tomatoes, around Rs 300 per kg and even more in some parts of the country, to Rs 10 per kg to the point that farmers were destroying them.

The high tomato prices played havoc with India’s food inflation numbers and inflation numbers which are now moderating.

We have gone from scarcity to excess very quickly.

Elsewhere, in the case of onions, a 40% export duty aimed at increasing domestic supply has led to farmer protests and strikes.

Between rice which we just spoke of and various other agri commodities that make up staple foods in India, policy making obviously has a critical role in price stability.

The Government has moved fast and sometimes too fast in some areas and maybe not sufficiently in others.

The larger question of course is that with weather patterns changing, consumption trends changing, policy on prices and tariffs, for both imports and exports has to be responsive but also moderated.

What are some of the lessons from the past in this regard and what can we learn from India’s own swinging patterns of excess and scarce supply dynamics.

Are there any templates, even if they are shifting, so to speak.

To get a wider perspective, I reached out to Siraj Hussain, former Agriculture Secretary to the Government of India and frequent columnist on agricultural and food production issues and began by asking him why we were swinging so wildly and so suddenly between excess and scarcity, as in the case of tomatoes.


Chromebooks in India, says Sunder Pichai

HP will make Google Chromebook laptops in India from this week, Alphabet and Google CEO Sundar Pichai said on twitter yesterday.

“We are partnering with HP to manufacture Chromebooks in India. These are the first Chromebooks to be made in India and will make it easier for Indian students to have access to affordable and secure computing,” he said.

Chromebook has had some success in the United States in the education segment, possibly leading on to a similar focus here. 

Education in general has been a specific target segment for computer makers and even chip makers like Intel who have targeted educational institutions, universities and colleges in the past.

Chromebooks cost less than notebooks with proprietary operating systems.

Computer industry research firm IDC has estimated, according to reports that, just over 8% of Chromebook sales in 2022 were made for commercial purposes — compared to 72% for education and the remaining 20% for consumer use. IDC expects the business part of that puzzle to keep growing but only slowly.

The original announcement came last week followed by Sunder Pichai’s statement yesterday.

The Chromebook devices will be manufactured at the Flex Facility near Chennai, where HP has been producing a range of laptops and desktops since August 2020, it said in a statement reported by news agencies.

According to the statement, Chromebooks, which come with Google's ChromeOS, are the leading devices in K-12 education, helping over 50 million students and teachers across the world.

HP has been expanding its manufacturing operations in India since 2020 and from December 2021, it started manufacturing a wide range of laptops in India, including HP EliteBooks, HP ProBooks, and HP G8 series notebooks.

Several manufacturers make Google Chromebooks globally. They include Lenovo, Dell, Acer and Asus.

And finally, the Nobel Prize for Medicine

Perhaps it was also logical that the scientists at the frontlines of the battle against Covid would get a Nobel.

The Nobel Prize in Physiology or Medicine has been awarded to a pair of scientists who developed the technology that led to the mRNA Covid vaccines.

Professors Katalin Kariko and Drew Weissman will share the prize.

The technology was experimental before the pandemic, but has now been given to millions of people around the world to protect them against serious Covid-19.

The same mRNA technology is now being researched for other diseases, including cancer, BBC News is reporting.

The Nobel Prize committee said: "The laureates contributed to the unprecedented rate of vaccine development during one of the greatest threats to human health in modern times."Both were told they had won by telephone this morning and were said to be "overwhelmed".

Traditional vaccine technology has been based on dead or weakened versions of the original virus or bacterium - or by using fragments of the infectious agent.

In contrast, messenger ribonucleic acid (mRNA) vaccines use a completely different approach.

During the Covid pandemic, the Moderna and Pfizer/BioNTech vaccines were both based on mRNA technology.

Professor Kariko and Professor Weissman met in the early 1990s when they were working at the University of Pennsylvania, in the United States, when their interest in mRNA was seen as a scientific backwater, says the BBC.

Katalin Kariko is now a professor at Szeged University in Hungary and Drew Weissman is still working as a professor at the University of Pennsylvania.