The election of Mr. Pranab Mukherjee as the thirteenth President of the Union of India now appears to be a foregone conclusion, and the twenty fifth of July promises to be a good day for the people of India, not so much because the Indian Union will get a new president, but because we shall finally receive deliverance from the cow who currently reigns as the sovereign of this country. Mr. Pranab Mukherjee, perhaps the most endearing politician(the heavily laden bengali accent is nothing short of legendary.) from the ruling Congress Party, seems set to sail through the presidential elections slated to be held on the nineteenth of next month, and the only other contender, a former Speaker of the Lok Sabha from the tumultuous nineties, Mr. P.A. Sangma, is hardly a worthy candidate for the Presidency. Though a man of probity, Mr. Sangma's behaviour over the past month, canvassing for himself and hopping around from one state capital to another proclaiming his own suitability is nothing short of disgraceful.However, far more portentous than Mr. Sangma's doomed campaign is the fact that the Bharatiya Janata Party(early disclaimer: my antecedents compel me to sympathize with these buffoons.), has decided to endorse Mr. Sangma's independent candidature, an act which in my eyes is symptomatic of the lack of leadership that pervades this party of somnolent old men (and an exceptionally disgraceful fat lady.); and despite all the wistfulness on the writer's part it serves as a reminder(like we needed one) that the party will not be anywhere close to in a position to form the government after the next general elections in 2014, and that the equally perverse Congress Party will see it through in a fractured mandate, with the populace further being blessed with another five years of indecision, corruption, and 'policy paralysis'(the term sounds cool, you have to admit?).
This is particularly depressing for a young, reasonably aware individual who itches to ensure the progress of his people reeling in deprivation and abhors the form of dynastic rule that the people of this ostensibly democratic civilization have willfully chosen for most of their modern existence. However two years ago, I was more than willing to swallow these reservations and partake in the sanguinary mood that had enveloped the nation, primarily fueled by the high rate of consistent economic growth the country had witnessed for the past ten years or so. However, things could hardly have gone worse for the economy since, the growth rate of the GDP for the first quarter of 2012 slipping to a despicable 5.7% from the 8.5% of last year. There can be no doubt that some of this is the fallout of the eurozone crisis, but there are certain indicators that there has been a sharp contraction in the rate of private investment and a gradual drying up of FDI. Symbolic of the causation of the investment-weariness is the much-reported case of the retrospective taxation imposed on Vodafone by the Government of India, an act which is likely to scare away already cautious prospective investors. Coinciding with this economic crisis is the freefall of the Indian Rupee, which even crossed the psychological barrier of 57 rupees to a dollar earlier this week (its lowest ever.). As if things couldn't get worse, Standard and Poor reviewed its fiscal outlook in the long-term for India to junk status. This has to be the nadir of the Indian economy; and far more portentously, inflation still remains high at 7 percent, making it impossible for the Reserve Bank of India to ease lending rates or for the government to ease the appalling fiscal deficit.
A significant reason for the downturn has to be the populist over-subsidization of several commodities. Several prominent Indian and Western economists have argued for the cessation of these subsidies, often quoting the preponderant share of these subsidies on the national budget. However, the ground reality remains that no government can even think of easing these subsidies as long as there remain a billion vulnerable and poor people in this country. What needs to be done immediately though is to bring the misdirected intermediate fuel subsidies of diesel and LPG to an end (Why the hell has the government not done it already?). Maybe I'm being a little extreme here, but I would even consider banning every damn SUV as long as affluent Indians driving them continue to drain the Indian economy by guzzling unintended subsidies the way they do.
This might seem unrelated to the earlier part of my post, but there is a tenuous but critical link here. The duties of the Finance Minister will now be temporarily discharged by Prime Minister Manmohan Singh (of L.P.G. fame.), and the optimistic should expect a fresh round of reforms that would stimulate economic growth again. There are already visible baby steps to a recovery and the Sensex has already gained over 550 points in the first four days of Manmohan Singh taking over as the FM. However, much remains to be done and the jury is still out on the future of the economy.
Also, our beloved Deutschland lost to Italy in the semis of the European Championship and consequently exited the Euro on Thursday night, as it gets unbearably hard to not break the television screen seeing Mario Balotelli play like that. Indian cricket ofcourse is going through a much needed languor and the only real Indian cricketer in the news is Sachin's fourteen-year old son Arjun(No, Yuvraj Singh no longer counts.), though last heard he had started training again at the NCA in Bengaluru, and a not so little bird tells the author that he is now only a shade of the player he once was, and that his cricketing career is all but over. However, there is some good news too, Rafael Nadal crashed out of the Wimbledon mid-week losing to unseeded Czech Lukas Rosol, and there still remains some hope that Federer might equal Pete Sampras's record of seven Wimbledon singles' titles, though the writer predicts the 'roof' at the Central Court will play a few more surprises before the end of the tournament.
That's all for now.
-Ac.
This is particularly depressing for a young, reasonably aware individual who itches to ensure the progress of his people reeling in deprivation and abhors the form of dynastic rule that the people of this ostensibly democratic civilization have willfully chosen for most of their modern existence. However two years ago, I was more than willing to swallow these reservations and partake in the sanguinary mood that had enveloped the nation, primarily fueled by the high rate of consistent economic growth the country had witnessed for the past ten years or so. However, things could hardly have gone worse for the economy since, the growth rate of the GDP for the first quarter of 2012 slipping to a despicable 5.7% from the 8.5% of last year. There can be no doubt that some of this is the fallout of the eurozone crisis, but there are certain indicators that there has been a sharp contraction in the rate of private investment and a gradual drying up of FDI. Symbolic of the causation of the investment-weariness is the much-reported case of the retrospective taxation imposed on Vodafone by the Government of India, an act which is likely to scare away already cautious prospective investors. Coinciding with this economic crisis is the freefall of the Indian Rupee, which even crossed the psychological barrier of 57 rupees to a dollar earlier this week (its lowest ever.). As if things couldn't get worse, Standard and Poor reviewed its fiscal outlook in the long-term for India to junk status. This has to be the nadir of the Indian economy; and far more portentously, inflation still remains high at 7 percent, making it impossible for the Reserve Bank of India to ease lending rates or for the government to ease the appalling fiscal deficit.
A significant reason for the downturn has to be the populist over-subsidization of several commodities. Several prominent Indian and Western economists have argued for the cessation of these subsidies, often quoting the preponderant share of these subsidies on the national budget. However, the ground reality remains that no government can even think of easing these subsidies as long as there remain a billion vulnerable and poor people in this country. What needs to be done immediately though is to bring the misdirected intermediate fuel subsidies of diesel and LPG to an end (Why the hell has the government not done it already?). Maybe I'm being a little extreme here, but I would even consider banning every damn SUV as long as affluent Indians driving them continue to drain the Indian economy by guzzling unintended subsidies the way they do.
This might seem unrelated to the earlier part of my post, but there is a tenuous but critical link here. The duties of the Finance Minister will now be temporarily discharged by Prime Minister Manmohan Singh (of L.P.G. fame.), and the optimistic should expect a fresh round of reforms that would stimulate economic growth again. There are already visible baby steps to a recovery and the Sensex has already gained over 550 points in the first four days of Manmohan Singh taking over as the FM. However, much remains to be done and the jury is still out on the future of the economy.
Also, our beloved Deutschland lost to Italy in the semis of the European Championship and consequently exited the Euro on Thursday night, as it gets unbearably hard to not break the television screen seeing Mario Balotelli play like that. Indian cricket ofcourse is going through a much needed languor and the only real Indian cricketer in the news is Sachin's fourteen-year old son Arjun(No, Yuvraj Singh no longer counts.), though last heard he had started training again at the NCA in Bengaluru, and a not so little bird tells the author that he is now only a shade of the player he once was, and that his cricketing career is all but over. However, there is some good news too, Rafael Nadal crashed out of the Wimbledon mid-week losing to unseeded Czech Lukas Rosol, and there still remains some hope that Federer might equal Pete Sampras's record of seven Wimbledon singles' titles, though the writer predicts the 'roof' at the Central Court will play a few more surprises before the end of the tournament.
That's all for now.
-Ac.
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ReplyDeleteMr. Choudhary
ReplyDeleteYour musings on the predicament of the Indian economy are impressive. However, I do not agree with the rather incongruous statement regarding diesel and SUVs. I am of the opinion that diesel is the best oil-based fuel at the moment, and so are hundreds of vehicular journalists. Diesel, therefore, must be sufficiently incentivized. The problem at hand is that it is much more expensive to produce than other similar fuels. Thus, some sort of short term subsidy is in fact necessary. Ergo, the subsidy on diesel should be reduced, rather than removed.