Five million lost jobs in India between 2016 and 2018

According to the Center for Monitoring the Indian Economy, employment actually contracted in the year following demonetization by 3.5 million jobs. The think tank said unemployment reached 7.4 percent in December 2018, its highest rate in more than two years. (AP)
Updated 17 April 2019
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Five million lost jobs in India between 2016 and 2018

  • The report by the Azim Premji University comes as Indians are voting in a staggered general election, which is due to end on May 19
  • The unemployed were mostly higher educated and young people, in the 20-24 age range

NEW DELHI: At least five million Indians lost their jobs between 2016 and 2018, and young urban men are being hit hardest, a Bengaluru-based private university said in a report on Tuesday.
The report by the Azim Premji University comes as Indians are voting in a staggered general election, which is due to end on May 19, with Prime Minister Narendra Modi’s government keen to defend its economic record, including on jobs.
“In addition to rising open unemployment among the higher educated, the less educated (and likely informal) workers have also seen job losses and reduced work opportunities since 2016,” said Amit Basole, an economist and lead author of the report.
The report did not say how many jobs were created during the period.
Modi’s abrupt withdrawal of high value currency notes from circulation in November 2016, with the aim of curbing tax evasion and promoting digital transactions, disrupted small businesses and sparked layoffs.
The introduction of a national sales tax the following year compounded difficulties for some businesses.
The unemployed were mostly higher educated and young people, in the 20-24 age range, according to the study titled “State of Working India 2019.”
“Among urban men, for example, this age group accounts for 13.5 percent of the working age population but 60 percent of the unemployed,” it said.
Modi has faced criticism for not doing enough to create jobs for millions of unemployed young people despite official annual economic growth of about 7 percent for the past five years.
An official survey that the government withheld showed unemployment rose to its highest level in at least 45 years in 2017/18, the Business Standard newspaper reported in February.
The unemployment rate rose to 7.2 percent in February 2019, its highest since September 2016, and up from 5.9 percent in February 2018, according to data compiled by the private research house, Center for Monitoring Indian Economy (CMIE).
The report suggested the next government should consider an urban employment guarantee scheme to create jobs, build infrastructure and provide services.
India has a rural jobs guarantee program, launched in 2006, which offers work to about 70 million rural people at the minimum wage for 100 days a year.
“India is at a crucial juncture in its economic development where timely public investment and public policy can reap huge rewards,” Basole said.


Saudi energy minister recommends driving down oil inventories, says supply plentiful

Updated 19 May 2019
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Saudi energy minister recommends driving down oil inventories, says supply plentiful

  • Oil supplies were sufficient and stockpiles were still rising despite massive output drops from Iran and Venezuela
  • Producer nations discussed how to stabilise a volatile oil market amid rising US-Iran tensions in the Gulf, which threaten to disrupt global supply

JEDDAH: Saudi Arabia’s Energy Minister Khalid Al-Falih said on Sunday he recommended “gently” driving oil inventories down at a time of plentiful global supplies and that OPEC would not make hasty decisions about output ahead of a June meeting.
“Overall, the market is in a delicate situation,” Falih told reporters before a ministerial panel meeting of top OPEC and non-OPEC oil producers, including Saudi Arabia and Russia.
While there is concern about supply disruptions, inventories are rising and the market should see a “comfortable supply situation in the weeks and months to come,” he said.
The Organization of the Petroleum Exporting Countries, of which Saudi Arabia is de facto leader, would have more data at its next meeting in late June to help it reach the best decision on output, Falih said.
“It is critical that we don’t make hasty decisions – given the conflicting data, the complexity involved, and the evolving situation,” he said, describing the outlook as “quite foggy” due in part to a trade dispute between the United States and China.
“But I want to assure you that our group has always done the right thing in the interests of both consumers and producers; and we will continue to do so,” he added.
OPEC, Russia and other non-OPEC producers, an alliance known as OPEC+, agreed to reduce output by 1.2 million barrels per day (bpd) from Jan. 1 for six months, a deal designed to stop inventories building up and weakening prices.
Russian Energy Minister Alexander Novak told reporters that different options were available for the output deal, including a rise in production in the second half of the year.
The energy minister of the United Arab Emirates, Suhail Al-Mazrouei, said oil producers were capable of filling any gap in the oil market and that relaxing supply cuts was not “the right decision.”
Mazrouei said the UAE did not want to see a rise in inventories that could lead to a price collapse and that OPEC would act wisely to maintain sustainable market balance.
“As UAE we see that the job is not done yet, there is still a period of time to look at the supply and demand and we don’t see any need to alter the agreement in the meantime,” he said.
US crude inventories rose unexpectedly last week to their highest since September 2017, while gasoline stockpiles decreased more than forecast, data from the government’s Energy Information Administration showed on Wednesday.
DELICATE BALANCE
Saudi Arabia sees no need to boost production quickly now, with oil at around $70 a barrel, as it fears a price crash and a build-up in inventories, OPEC sources said, adding that Russia wants to increase supply after June.
The United States, not a member of OPEC+ but a close ally of Riyadh, wants the group to boost output to bring oil prices down.
Falih has to find a delicate balance between keeping the oil market well supplied and prices high enough for Riyadh’s budget needs, while pleasing Moscow to ensure Russia remains in the OPEC+ pact, and being responsive to the concerns of the United States and the rest of OPEC+, the sources said earlier.
Sunday’s meeting of the ministerial panel, known as the JMMC, comes amid concerns of a tight market. Iran’s oil exports are likely to drop further in May and shipments from Venezuela could fall again in coming weeks due to US sanctions.
Oil contamination also forced Russia to halt flows along the Druzhba pipeline — a key conduit for crude into Eastern Europe and Germany — in April. The suspension, as yet of unclear duration, left refiners scrambling to find supplies.
Russia’s Novak told reporters that oil supplies to Poland via the pipeline would start on Monday.
OPEC’s agreed share of the cuts is 800,000 bpd, but its actual reduction is far larger due to the production losses in Iran and Venezuela. Both are under US sanctions and exempt from the voluntary reductions under the OPEC-led deal.
REGIONAL TENSIONS
Oil prices edged lower on Friday due to demand fears amid a standoff in Sino-US trade talks, but both benchmarks ended the week higher on rising concerns over disruptions in Middle East shipments due to US-Iran political tensions.
Tensions between Saudi Arabia and Iran are running high after last week’s attacks on two Saudi oil tankers off the UAE coast and another on Saudi oil facilities inside the Kingdom.
Riyadh accused Tehran of ordering the drone strikes on oil pumping stations, for which Yemen’s Iran-aligned Houthi militia claimed responsibility. 
Saudi Arabia’s minister of state for foreign affairs said on Sunday that the Kingdom wants to avert war in the region but stands ready to respond with “all strength” following the attacks.
“Although it has not affected our supplies, such acts of terrorism are deplorable,” Falih said. “They threaten uninterrupted supplies of energy to the world and put a global economy that is already facing headwinds at further risk.”
The attacks come as the United States and Iran spar over Washington’s tightening of sanctions aimed at cutting Iranian oil exports to zero, and an increased US military presence in the Gulf over perceived Iranian threats to US interests.