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Indian Economic doldrums continues

Though the Prime Minister claims a boom in Infrastructure sector, the Indian economy has started fumbling in 2013 and hardly shows any signal of drastic change in the coming year. GDP growth is languishing even below 5 per cent, instead of projected 10per cent. On the contrary, the inflation rate has shot up much beyond the projected 5 per cent and is now raising its head above 10 per cent. Such a reverse scenario clearly depicts the current Indian economic chaos.

It is indeed true that the bureaucratic inertia has always hindered the economic growth as most of the projects can never accelerate their momentum due to prolonged government processes for various clearances. If the bureaucratic blockages extend the initiation of any project, the return on investment is slowed down. India is a country that often witnesses poor coordination between different departments. Perhaps the efforts like one-window counter may resolve such unnecessary delays.

Many companies have been hesitant in the wake of a couple of vigilance inquiries at the corporate level that the country has witnessed last year. Whether it is the Governmental probe or the legal probe, the corporate have been slightly shaken. Besides the vigilance inquiries, some projects are tied up for the environmental clearance, which could have been expedited.

Many industries have been battered by the paralyzed decision making ability of the Government in various fronts. The ongoing battle regarding Vodafone or Nokia is bound to raise worries.

While serious reforms have become inevitable, some quick decisive actions at the administrative level of the government have also become unavoidable to set Indian economy back on tracks.

When the inflation rate has gone much beyond the prediction, the announcement of some easy financial packages can hardly remain yielding in the long term. Rather, we should congratulate the RBI for stabilizing the repo rate for the time being, at the least. Who else than Manmohan Singh understands better that India’s slow paced economy has been triggered off by the increase in IOCR? The fall in investment is certainly worrisome, but the ICOR has to be focused upon even more.

Sarcastically, the rupee has fallen by .8 per cent this year, which has certainly been alarming to Indian economy. The foreign investors will become cautious while investing in India. The country has been marred by abysmally low investment rate. HSBC continues to show a decline rate in its service industry in India.

The news like Toyota’s launch of mini SUV based on Etios platform in India or RIL to double its natural gas production may be a shy of relief to Manmohan Singh on the verge of his retirement, but it can hardly bring about a revolutionary change in Indian economy. Perhaps Chidambaram may become content as the direct tax collection has clocked a growth of 12.33 per cent.

It is good to learn that the sentiment regarding stock market has remained positive , but the dramatic change of US policies are far more responsible for the same. Infosys has got a boost as their key projects in US have been gearing up. We must take a note that Gartner has predicted a growth of 3.1 per cent in 2014 in global IT expenses. The UPA-2 government may be happy that the Gold prices have been steady or the announcement of bidding of 56 oil and gas blocks under revamped terms may excite the Congress-friendly businessmen, but Indian citizens have burnt their fingers many a times.

We do realize that an overnight solution to such an economic disorder is impossible, but the Government at the fag end of its tenure can exhibit some good intentions, at the least. Let the history cherish Manmohan Singh for his pragmatic solutions in his core finance segment, at the least.

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