Business News/ Opinion / Views/ Trillion dollar question: Will the events of 2024 set off a headwind or tailwind?
Gift this article
Another year recedes for a new one to begin, laden with our collective hopes and expectations. The end of any time cycle is a good moment for honest reviews and barebone analysis. The past 12 months have been quite momentous, etching new lines in the sand and conjuring images that inspire both awe and dread.
Another year recedes for a new one to begin, laden with our collective hopes and expectations. The end of any time cycle is a good moment for honest reviews and barebone analysis. The past 12 months have been quite momentous, etching new lines in the sand and conjuring images that inspire both awe and dread.
Students of the social sciences—particularly history—will find many similarities with events from almost a century ago, renewing faith in philosopher George Santayana’s famous line that those who do not remember the past are condemned to repeat it.
Students of the social sciences—particularly history—will find many similarities with events from almost a century ago, renewing faith in philosopher George Santayana’s famous line that those who do not remember the past are condemned to repeat it.
Unsurprisingly, there is also renewed interest in social-cycle theories of sociology which posit that history and societal phases get repeated in cycles. Such theories have counterparts even in economics, which are also getting a fresh relook with the help of analytical tools.
This rekindled interest seems motivated by the shape of events in 2024, as well as related developments in preceding years.
Also read: 2025 will be a crucial year for Indian creator economy
In domestic politics, the two big events of the past 12 months were the Lok Sabha elections and assembly polls in Maharashtra, Haryana, Jharkhand, Odisha, Jammu and Kashmir, Andhra Pradesh, Arunachal Pradesh and Sikkim.
While India’s general election results saw the ruling Bharatiya Janata Party (BJP) lose its majority in Parliament, forcing its dependence on a coalition to retain power, it secured large victories in Odisha, Maharashtra and Haryana.
The final tallies can be interpreted as the electorate signalling some discontent with the BJP’s performance at the centre, but needing its governance at the state level.
Globally, 2024 saw the unchallenged rise of right-wing parties and politicians in various national elections, the intensification of wars and brutality, a regime change in Syria and the deepening of old fault-lines in West Asia.
Notably, with populations across borders having voiced their frustration with the political status quo and elected autocratic leaders in multiple jurisdictions, the tone and tenor of global governance might be poised for a shake-up.
Also read: Consumer goods companies brace for an uncertain 2025 but hope to cash in on premium cravings
It might be prudent to put economics at the centre of all this flux—for influencing politics and, in turn, being shaped by transformed political forces. The dominant economic model of the 1990s and oughties, which resulted in the 2008-09 financial crisis, is strangely still echoed in economic policies across the world.
Excessive financialization of the economy has led to stagnant real wages for factory jobs and other critical professions, alongside outsized salaries and bonuses for finance-sector professionals. Another manifestation of lopsided development has been the heady performance of equity markets and property prices in many parts of the world.
Asset prices have stood out starkly for being detached from ground realities. Owners of shares have seen their wealth swell while wage-earners with few assets to count on got left behind. Uneven outcomes have found expression in ballot boxes and it is yet to be seen how elected ‘strongmen’ respond to economic imbalances, though some of them in Europe and elsewhere have relied on accelerated resource transfers to placate people and keep the peace.
Ongoing wars, climate change and health scares have injected an inflationary bias into the global economy while rendering growth uncertain. Decelerating globalization has added further uncertainty. The trillion-dollar question is whether all these forces will add up to act as a headwind or tailwind in 2025.
Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
Get the latest financial, economic and market news, instantly.
{{^adFree}}
{{/adFree}}