Living in denial: 

Living in denial: 

Context

• Economic deceleration is real. Acknowledging it is the first step to recovery

Reasons behind economic deceleration

1. Freefall of rupee against dollar and other currencies
2. Widening current account deficit (CAD)
3. Soaring inflation
4. Dampened GDP growth.
5. Over-dependence on tertiary sector growth
6. Various government policies

Step required for recovery

1. Acknowledge the slowdown and spend on rural areas
2. India needs to stop chasing the “mirage of a rating upgrade” and focus on spending more.(fiscal stimulus, SOP to exporters, etc)
3. Cut interest rates, provide financing and stable business environment.
4. Rationalising government policies(esp subsidies)
5. Maintain Balance of payment
6. Introducing reforms in various sector such as land reform, labour reform, service sector etc

Conclusion

There is a need to shift our focus from consumption to supply. It is high time we understand that being a consumer doesn’t count in the long run; it is being a producer that counts, and that is the key to becoming an economic super-power.