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By:

Abhijit Mulye

21 August 2024 at 11:29:11 am

RBI forced to rethink inflation, growth

Mumbai: The undeniable reality of climate change is rapidly transitioning from an ecological warning to a severe economic crisis in India. Global warming is no longer just altering natural ecosystems; it is fundamentally rewriting the rules of the nation's macroeconomic stability. A stark illustration of this shift comes from the HSBC report published on Monday, which highlights how rising surface temperatures and the looming threat of El Niño are directly forcing the Reserve Bank of India to...

RBI forced to rethink inflation, growth

Mumbai: The undeniable reality of climate change is rapidly transitioning from an ecological warning to a severe economic crisis in India. Global warming is no longer just altering natural ecosystems; it is fundamentally rewriting the rules of the nation's macroeconomic stability. A stark illustration of this shift comes from the HSBC report published on Monday, which highlights how rising surface temperatures and the looming threat of El Niño are directly forcing the Reserve Bank of India to reconsider its monetary policy, proving that climate shocks are now dictating everyday financial realities. ​ For decades, economists and policymakers have anxiously tracked the Indian monsoon, relying on rain gauges and reservoir levels to forecast agricultural output and inflation. However, HSBC’s analysis reveals a startling paradigm shift: tracking rising temperatures has now become a far more accurate method for predicting food inflation than observing traditional rainfall patterns. As average surface temperatures breach historical thresholds, the sensitivity of food prices to extreme heat has increased dramatically. During El Niño years, the probability of severe temperature spikes is now significantly higher than the chances of a rainfall deficit. These intensifying spikes mean the thermometer has become a far more vital forecasting tool for the central bank than the rain gauge. ​ The effects of this warming planet are cascading through various walks of life, starting at the very roots of the agricultural sector. Intense and frequent heatwaves are no longer just wilting delicate, perishable crops like fruits and vegetables, which have traditionally been highly vulnerable to sudden temperature fluctuations. The soaring mercury is now directly threatening the resilience of durable staple crops, including cereals, pulses, oilseeds, and sugar. When these crucial crops fail to withstand the intensifying heat, the immediate fallout is a sharp surge in food prices. While robust granaries might offer a temporary buffer, the overarching trend points to persistent agricultural distress, threatening food security and pushing the financial burden directly onto the plates of ordinary citizens. Complex Web ​This climate-induced disruption is creating a complex web of challenges for the national economy. The HSBC report predicts that the combination of El Niño-driven temperature shocks and global energy pressures could push headline inflation to an average of 5.6 percent in the 2026-27 financial year. This overlapping environmental and economic crisis leaves the Reserve Bank of India in a precarious position. To combat the inflationary heat, the central bank is projected to deliver two interest rate hikes between late 2026 and early 2027, ultimately pushing the repo rate to 5.75 percent. However, the central bank must tread carefully, as these relentless climate shocks are simultaneously dragging down the nation's economic momentum, with GDP growth projections downgraded from a robust 7.4 percent to a sluggish 6 percent. ​ Ultimately, the heaviest toll of this shifting climate is borne by the most vulnerable segments of society. The intersection of severe weather events, rising food costs, and tightening economic policies strikes hardest at the informal sector. Rural households, small agricultural businesses, and daily wage earners find their livelihoods increasingly squeezed by extreme weather forces entirely out of their control. The warming climate is fundamentally changing the drivers of India’s economic growth, turning environmental predictability into a luxury of the past. As policymakers grapple with these twin shocks of heat and inflation, it is evident that climate change has firmly rooted itself in every facet of Indian life.

The Cost of Constant Consumption

As we curate our content, the deeper question is whether content is quietly curating us.

Few can manage a 90-hour workweek, but most would easily go beyond a 90-hour social media week. With our growing appetite for social media and instant commerce, the real question is no longer just how we consume, but how much. In an age where every swipe, click and scroll is engineered to hold attention, overconsumption is becoming less a habit and more a way of life. What once felt private is now constantly translated into data, tracked, analysed and fed back to us as personalised content.


Our chat topics increasingly shape what appears on our feeds, drawing us deeper into social media and blurring the line between private thought and public consumption. Shopping apps track our preferences and know exactly what to show us, when to show it, and how to keep us engaged. As we curate our content, is content curating us too? In India, this influence is amplified by scale: the country has over 820 million internet users, more than half from rural India. And because creating content now requires little more than a smartphone, production has exploded, feeding an endless supply of content to consume. We are no longer just seeking information online; we are constantly being served information we never asked for.


The Attention Trap

Urban youth face intense pressure to keep pace with the latest memes and trends, consuming more content in pursuit of social validation. For many, especially the young, staying updated has become a form of cultural currency — a way to belong, be seen and stay relevant. Across the world, users spend an average of more than two hours a day on social media, while reels lasting just 30 to 90 seconds are steadily reshaping attention spans. What begins as constant engagement online does not stay there. With everything at our fingertips, people are becoming less tolerant of delay, boredom and inconvenience. The speed of the internet is not just shrinking our attention spans — it is eroding our patience in everyday life.


Convenience Culture

Quick commerce platforms have turned this impatience into a business model. Ten-minute deliveries, constant offers and endless discounts encourage impulsive buying, from groceries to stationery, while quietly raising our expectations for speed. Convenience now drives not just what we buy but how we behave — leaving users less tolerant of delays and delivery workers under relentless pressure.


A 2018 Pew Research Centre survey of 743 teens found that 31% lost focus in class while checking their phones. Increased internet use also disrupts sleep, as young adults scroll through reels late into the night, leaving many sleep-deprived. The endless scroll is designed to make stopping difficult, and reduced sleep worsens mood, irritability and concentration.


Late Gen Z and Gen Alpha differ sharply from earlier generations. Raised on algorithms and personalised feeds, their worldview is shifting, while teachers increasingly struggle with shrinking attention spans and worsening classroom behaviour. Rising loneliness and excessive screen time have also blurred the line between online and offline life. As screen time rises, the warmth of community and unstructured human interaction is giving way to more mediated and transactional forms of connection.


Algorithms & Intimacy

Artificial intelligence has rapidly integrated into our routines, making tasks easier and more convenient. Large language models are trained on human interactions, and the more we use them, the more they adapt to our habits, perceptions and preferences — deepening their influence on our lives. As with social media, what feels intuitive or personalised is often the result of systems learning us faster than we realise. The more seamless these systems become, the easier it is to mistake convenience for connection and prediction for understanding.


In the 21st century, data has become central to our existence. Social media and AI exploit our psychology, trapping attention in a cycle of constant content exchange. Sharing even small details updates our feeds almost instantly, sometimes making algorithms seem to understand us better than the people around us.


Users remain deeply engaged in this digital world, often believing their content is curated just for them. In reality, companies profit from these interactions, growing richer while shaping consumer behaviour. What feels personal is, at scale, a business model designed to monetise attention.


As digitisation rewires our brains and lifestyles, living offline has become increasingly difficult. New technologies promise convenience, but they are also reshaping how we consume content and experience the world. As we consume technology, the unsettling truth is that we may also be consuming ourselves.

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