Introduction:

I wish I'd been omniscient and seen the crisis coming.

~Federal Reserve Chairman, Ben Bernanke.

Of late, a multitude of mishaps have gripped the economies world over in a storm, the markets are suffering, the sentiments are negative, exchange rates are unfavorable, and a very high possibility of the Eurozone coming down, is doing no good but adding fuel to the fire. Given the various deficits our economy is running and a GDP growth that is likely to plunge below 7%, the twenty first century Indias growth story doesnt quite impress either. The Eurozone crisis, monetary policy miscalculations and political populism have combined to shave more than 1.5% off the estimated GDP growth this year and as a result, the Indian capital market remains under-funded. Despite a tough global environment, experts believe, that Indian economy still has the potential to expand at a sustainable 8.5-9% annually. We at Cognizance 2012, aim to discover the best ideas and innovations from across the nation that can reform and revolutionize the present day Indian Economy against the problems it is facing presently. to recover the growth momentum the policy focus will have to be adjusted accordingly.
~D. Subbarao, Governor, RBI.

Inspired from the above lines, Economix envisions a pragmatic change in the Indian Economy by identifying the prevalent problems and finding concrete solutions by encouraging an in-depth study of Indian economics, and inviting policy measures (fiscal & monetary) that the Government of India & its Financial Institutions should adopt in order to protect its economy to the best possible extent, from the setbacks that maybe caused due to this imminent meltdown.

For queries: Sahil Arora +91-7417796559

The Roadmap:
no one likes or wants a recession. Almost everyone appears reconciled to one in the United States politicians continue to downplay any fears of global repercussionsBut what is the reality for countries like India!?... - B V Krishnamurthy, HBR, January 24, 2008

The Global recession of 2008 is considered by many economists as the worst financial crisis since the great depression of the 1930s. Though it resulted in the collapse of large financial institutions, bailouts of banks and downturns in international stock markets, India with a reasonably strong financial system in place, could bear the shocks, to an appreciable extent. The sectors most affected were airlines, hotels and real estate, and a weakening demand in the US affected our IT and BPO sector, by as much as a loss in overall revenue by 50%. Still, with appropriate & timely intervention our government was well able to steer our economy out of a potential disaster. But the story, it seems was not quite finished yet.
Italian yields have dropped by 50 bps and Belgian notes of the same maturity have declined by 22 bps since December 21, 2011, when the European Central Bank supplied banks with $636 Billion, of three-year loansThe European Commission cut its 2012 growth forecast by more than half to 0.5%... Luxembourg Prime Ministersaid Wednesday that the region is "on the brink of a recession of which one doesn't know the scope yet"The euro posted its first back-to-back annual losses against the dollar in a decade last year... -Economic Times, January 6, 2012.

In the Eurozone, with all the eyes on the ECB and the members of the EU making atrocious attempts to overcome the debt crisis that has crippled the EU in the last two years, the states struggling to agree on how to get more ammunition to fight the crisis, and the PIIGS being rocked by a debt crisis, the debt figures have soared and the liquidity has tightened in markets all over the world. Despite these crises, India being a conservative and regulated economy, its markets havent felt the deleterious effects of the global meltdown to a very large extent hitherto. But, these recessionary trends in Europe will have their impact on India, first and foremost being the negative investor sentiment, and the markets can only be saved if a viable solution to the Euro crisis can be figured out, and anything short of it will send the markets into a tailspin. Secondly, due to the declining rupee and a variety of deficits our country is running, inflation is also an issue here to stay. Moreover, the rupee is depreciating at a meteoric rate not primarily due to FIIs returning to safe havens, but apparently due to negative market sentiments and will continue its trajectory downwards if the crisis intensifies further.

Problem Statement:
Hence in the backdrop of current economic slowdown, what improvements in the policy measures (fiscal & monetary) should the Government of India & its Financial Institutions incorporate so as to protect its economy to the best possible extent from the setbacks that it may face in the near future?

Current Statistics:
The fiscal deficit is set to speed past 5.5% in 2011-12. Last year, a robust GDP growth could curtail the fiscal deficit to 4.7%, but the possibility of the same is blurred this year due to the GDP growth likely to slip below 7%. The budgeted target of Rs.12.58 lac Crores expenditure, is expected to be exceeded significantly. Two of the three key expenditure items, viz. subsidies and government overheads consume a large share of the non-plan expenditure. Subsidies alone soak up to Rs.1.44 lac Crores per annum also another entrenched expenditure is the interest outgo of Rs.2.67 lac Crores. Hit by a falling rupee, Indias trade deficit for 2011-12 is expected to widen sharply between $155-160 billion from $104 billion a year ago. The Current Account Deficit (CAD) swelled to $14.1 billion in its fiscal Q1 of 2011-12, nearly three times the previous quarters tally, and for the current FY it is likely to exceed $54 billion- well over the targeted 3% of GDP- as FDI/FII inflows slow. Financial savings also have fallen from 12.1% of GDP in 2009-10 to 9.7% in 2010-11. Further the Gross tax revenue is likely to miss the budgeted target of Rs. 9.32 lakh Crores. And the country's foreign exchange reserves have dipped $3.2 billion to $293.5 billion early January mainly because the Reserve Bank sold dollars to rein in the value of the Rupee.

*The above Statistics are purely indicatory in nature, and are not subject to further verifications or discussions.

General Guidelines: Economix is an International, policy study-cum-reforms based event, and is open to all, sans any discrimination. Every team has to register online on our websites Home Page. A registration number will be allocated to the team on registration which should be quoted during future correspondence. The participating teams can consist of a maximum of 3 members, and if more members are required then they may contact the coordinators with suitable explanations. Send your abstracts to economix@cognizance.org.in. Only the abstracts that are submitted on or before 6:00pm, 15th Feb. 2012 will be considered. Shortlisting process shall be carried out by a very distinguished panel of judges, details of which shall soon be made available. Shortlisted participants will be informed either through the phone or e-mail and a list of which shall also be uploaded on the website, latest by 20th Feb. 2012. Participants will have to confirm their presence during the festival period, latest by 25th Feb. 2012, exceeding which their entries stand liable to cancellation. The shortlisted participants will have to prepare a detailed presentation, which they shall present in front of the judges during Cognizance 2012, held during 23rd-25th March, 2012. The format of the presentation shall be made available soon after the declaration of the results of shortlisted teams.

Abstract report format:

The participants have to submit their abstract reports in the following format: o
o The ad hoc problems curbing the Indian economy, in very precise & laconic terms. The particular policies and the departments or divisions of the Govt. of India, and the particular financial institutions that you are aiming to work upon, along with the proposed reforms.

The entries are to be submitted in the form of short abstract reports, subject to following checks:
o o o o A word limit of 450 words, out of which 150 words are for problems that Indian Economy is facing, and 300 words for rest. Format: Portable Document Format (PDF). Font style: Calibri (Body) Font size: 11 Font Color: Black

The shortlisted teams shall be asked to prepare a detailed presentation, explaining clearly how their policy reforms and the Institutions that they have chosen, will curb these problems, in a highly explicit and detailed manner. Judging criteria: The abstract reports submitted shall be shortlisted and judged by a very distinguished panel of judges, details of which shall soon be updated. The criteria for judging or shortlisting the entries shall be as follows:
o o One-third weightage shall be given to the participants ability to understand the problem. Two-thirds of the weightage shall be given to the policies that the participant targets along with the tentative reforms proposed and the effects that shall be achieved upon implementation of these.

*Rules are subject to change as per Organizers discretion, and all the updates shall be communicated through the Official Cognizance 2012 website only.