jayakris wrote:I need a shot of optimism on this from PKB. Sandeep seems to have given up on India. Jay
Seriously, you got to be in India to understand it. It just baffles me to see people going after Subba Rao for the rate cut. It neither held up Indian economy nor it will help unless the lending rates in India from banks will probably come down to 5% levels which I think is impossible. The current lending rate for businesses is at 14%, bringing it down to 12% is not going to help much.
Think about it, telecom, mining, power, steel, cement, airline, textile industries are all struggling. Software and services are the only two industries which are going gangbusters while automobile is doing slightly better. Every other sector is nearing collapse and I am not kidding or exaggerating when I use the word collapse. The worst part, government has a major hand in killing these sectors. Manufacturing is at an all time low and I have heard many senior people say that they have never come across such a crisis in their lifetimes.
What explains this, food inflation at an all time high but farmer is only getting poorer. There are 30-40% people below poverty line who are struggling for basic amenities and industries are facing major labor shortage! How can these two go hand in hand? We are in a big time mess. Really big
There is a major power shortage through out the country with half the thermal power plants shutting down due to lack of coal, Andhra Pradesh (third biggest state by GDP) is facing an unprecedented 15 days power cut a month for Industries, Southern Tamil Nadu is facing almost 14 hours power cut a day and our center is mutedly looking at all the tamasha going on with respect to CAG report!!!
Supreme court has no business interfering with policy decisions. The day they started canceling spectrums and coal blocks is the time India's decline started. There is a policy paralysis now because of this.
Budget deficit of over 5.3% for a country growing at over 6%!!! It must be a joke, instead of the deficit coming down it is only ballooning.
India for sure is doomed unless we see a strong able prime minister at the helm. Sadly neither the Congress nor BJP has an answer. Cutting down rates and opening up markets is not the solution for India. The ease of doing business should be improved dramatically and foreigners should feel welcome, retrospective taxes on Vodaphone or canceling Telenor spectrums is not helping in anyway. Pathetic state of affairs
I will be pleasantly surprised if anyone can provide a positive twist to our economy and horrendous state of affairs.