 "Best of BS Opinion: How India is rethinking pay, policy, and global ties")
The government’s decision to set up the 8th Central Pay Commission marks the start of another round of wage reform that will affect nearly 12 million employees and pensioners, including those in defence services. The panel has 18 months to submit its report, with implementation expected from January 1, 2026. Its challenge will be to balance fair compensation with fiscal discipline, especially since the 7th Commission’s rollout had added about Rs 1 trillion to the government’s expenditure, notes our first editorial. The new panel has been asked to assess private-public sector pay disparities and suggest ways to boost productivity, not just pay. That broader goal may be crucial as states already spend more than a fifth of their budgets on salaries and pensions.
Meanwhile, Indian investors appear to be embracing a quieter revolution in how they deploy savings. For the first time, passive mutual fund schemes attracted more new accounts than active equity funds in September. Passive investing, long the norm globally, offers lower costs and simpler tracking of market performance. While active equity funds still hold a dominant 70 per cent share, the rise of passives suggests a maturing investor mindset, highlights our second editorial. It may mark the beginning of a structural shift in India’s household investment behaviour.
Amita Batra writes that India’s growing web of trade deals, including a fresh FTA with the UK and another in the works with the European Union, could open up valuable export avenues. But India’s textile and clothing sector, once a cornerstone of employment and export strength, must prepare for stiffer competition. Unlike Vietnam and Bangladesh, which leveraged early trade deals to secure near-zero tariffs and align with global sustainability standards, India’s exporters remain constrained by fragmented supply chains, high logistics costs, and slow adaptation to new technologies.
And Rajesh Kumar draws our attention to India’s fiscal policy which will soon shift focus from deficit targets to a broader goal of debt reduction. Starting FY27, the government aims to lower debt to about 50 per cent of GDP by 2031. While this marks an evolution in fiscal thinking, its success depends on sustained growth and clear communication. Uncertainty over the framework could unsettle markets that have thus far rewarded India’s steady post-pandemic fiscal consolidation.
Finally, in her review of Alexander Clapp’s Waste Wars: Dirt Deals, International Rivalries and the Scandalous Afterlife of Rubbish, Kanika Datta highlights a chilling investigation into the global trade in garbage. From Benin’s radioactive waste deals to Ghana’s toxic scrapyards, Clapp exposes how rich countries export their refuse and their risks to poorer ones. It’s a stark reminder that modern prosperity often leaves its dirtiest costs elsewhere.
Stay tuned!