Chief Economist & Political Strategist, CrossASEAN Research

Prasenjit K. Basu

PK Basu has 34 years experience covering Asia's economies and markets (equities, fixed income and currencies), including 20 years covering the global economy. He was Chief Economist (SE Asia & India) at Credit Suisse First Boston for 5 years, and Chief Asia (x-Jpn) Economist at Daiwa Securities for a similar period. Among other roles, he was global head of research at Maybank Kim Eng, Malaysia equity research head and chief ASEAN economist at Macquarie, Chief Economist at ICICI Securities, ASEAN economist at UBS and the first chief economist at Khazanah Nasional (where he was co-head of research, and led all agri-business initiatives). PK Basu started his career in the Asia Service of WEFA (Wharton Econometrics) in Philadelphia in 1990, rising to be Director of their Asia Service in June 1994. 
PK's book, "Asia Reborn: A continent rises from the ravages of Colonialism and War to a New Dynamism" won the Tata Literature First Book Award (non-fiction) for 2018. It is the first single chronicle of the modern economic and political history of the whole of Asia (from Iraq and Turkey to Korea and Japan, and everything in between), told from an Asian perspective.

Chief Economist & Political Strategist

India: Public Investment, Privatization & Bank Reform Set the Stage for Faster Growth

Which Asian Equity Markets Are Still Cheap?

India: Easing Inflation Will Oblige RBI to Cut Policy Rates in the Next Half Year

India's 2020 Reforms Will Usher in a Decade of Spectacular Growth from 2021 On

Economic Recovery Is Gaining Momentum, but Monetary Stimulus Would Help

India: Strengthening Recovery Will Defy the IMF's Pessimism on FY2020/21 Growth

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Macroeconomics

While the Economic Survey garnered headlines for its bold call for aggressive fiscal spending in the period ahead, one remarkable fact was lost in the noise: India's fiscal deficit declined 12.7% YoY in October-December 2020, and was consequently up only 24.3% YoY in Apr-Dec 2020 despite a severe economic recession. This was made possible by ensuring that net tax revenues actually increased 6.35% YoY in Apr-Dec 2020, despite the economic contraction during the period. It was only after it was clear that tax revenues were recovering in Q3 of the fiscal year that government spending began to be ramped up (having declined marginally in Apr-Sep20). In a fuel-scarce economy, consumers of petrol and diesel have borne the brunt of fiscal restraint in a difficult year. Excise duty revenues were up 54% YoY in April-December 2020, almost entirely because of petroleum-related excise duties. Personal income tax revenue soared 25.5% YoY in 3Q (Oct-Dec 2020) and corporate tax revenue increased 34.8% YoY that quarter -- pointing to a clear rebound in middle-class incomes and corporate profits in the last quarter -- which are likely to continue in the Jan-Mar 2021 quarter, especially given that March is usually the biggest month for production, income and government tax revenue -- but March 2020 was when the lockdown began. We continue to expect that the government's forecast of a contraction in real GDP of 7.7% in FY2020/21 is too low: the rebound in the second half of the fiscal year will be substantially positive (not a contraction as the Survey conservatively estimates). Incredible fiscal restraint during the recession has now prepared the way for a powerful rebound in government spending -- permitted by a rebound in tax revenue as the economy recovers. More importantly, privatization revenues (which have performed very poorly again this FY) are likely to play a very big part in the period ahead. Given the strength of equity markets, it is a shame that the government did not make more progress with privatisation in 2020, but that is likely to be a big and genuine theme in the year ahead. We remain bullish on India.

While the Economic Survey garnered headlines for its bold call for aggressive fiscal spending in the period ahead, one remarkable fact was lost in the noise: India's fiscal deficit declined 12.7% YoY in October-December 2020, and was consequently up only 24.3% YoY in Apr-Dec 2020 despite a severe economic recession. This was made possible by ensuring that net tax revenues actually increased 6.35% YoY in Apr-Dec 2020, despite the economic contraction during the period. It was only after it was clear that tax revenues were recovering in Q3 of the fiscal year that government spending began to be ramped up (having declined marginally in Apr-Sep20). In a fuel-scarce economy, consumers of petrol and diesel have borne the brunt of fiscal restraint in a difficult year. Excise duty revenues were up 54% YoY in April-December 2020, almost entirely because of petroleum-related excise duties. Personal income tax revenue soared 25.5% YoY in 3Q (Oct-Dec 2020) and corporate tax revenue increased 34.8% YoY that quarter -- pointing to a clear rebound in middle-class incomes and corporate profits in the last quarter -- which are likely to continue in the Jan-Mar 2021 quarter, especially given that March is usually the biggest month for production, income and government tax revenue -- but March 2020 was when the lockdown began. We continue to expect that the government's forecast of a contraction in real GDP of 7.7% in FY2020/21 is too low: the rebound in the second half of the fiscal year will be substantially positive (not a contraction as the Survey conservatively estimates). Incredible fiscal restraint during the recession has now prepared the way for a powerful rebound in government spending -- permitted by a rebound in tax revenue as the economy recovers. More importantly, privatization revenues (which have performed very poorly again this FY) are likely to play a very big part in the period ahead. Given the strength of equity markets, it is a shame that the government did not make more progress with privatisation in 2020, but that is likely to be a big and genuine theme in the year ahead. We remain bullish on India.  

India: Incredible Fiscal Responsibility Amid the Economic Devastation of Covid