India presses the ‘Panic Button’
India needs USD 80 Billion of foreign capital to fund its current account gap. Imagine, finance minister Chidambaram doing a road show in Hong Kong to woo investors! Anand Sharma twisting the rules to get IKEA money & pushing for getting dollar funds via FDI in retail, Pranab shunted to Rashtrapati Bhawan & the Vodafone tax amendment being redone..Do all these not appear as desperate measures? I wrote a few weeks ago, on how the ministries are making plans without money, and this is happening for the first time in history…
If the country has strong fundamentals, why should the finance minster be doing a road show in the first place! The panic does not end here, the budget cuts in important sectors like defense and other social sectors does signal that all is not well within India, and the panic button has already been pressed! We are nearing a ‘Fiscal slide’ & the consequent ‘hard landing’ will be steeper than the ‘fiscal cliff’ of the US. We are back to the 90’s. That time also, on the pressure of IMF, we had to ‘open’ the economy. Now the countries that ‘forced’ India to open the economy are also in the same boat ….So now the veiled threat of down grades.
This Government has not addressed the problems of India, as they have not diagnosed the problem rightly …….Our finance ‘doctors’ are just ‘suppressing the symptoms’ and not trying to ‘address the cause’, & So, the disease will never get cured. More pain in store for the Indian Economy
I hope we do not go the Kingfisher way………….
Rajendra Pratap Gupta