Debroy: India's economic slowdown self inflicted

I've always found Debroy's views to be the equivalent of a very cold shower -- not always pleasant, but a dam good wake up call.
And he delivered another one this morning, though frankly it was not unexpected: India's economy is slowing because of internal mismanagement, not global forces.

Had fiscal reforms and rectitude characterised years of buoyant growth, life would have been different. But today, properly accounted (not technical definition of fiscal deficit alone) deficits are at pre-1991 levels, with the Centre the culprit. There is little room for fiscal expansion and barring indirect tax cuts, other elements of the new fiscal package sound more promising than they are.

Ignoring this, India’s investment rate is now more than 36 per cent. The fiscal stimulus, if significant, implies a switch from private to government expenditure and from investment to consumption expenditure. This knocks the bottom out of what has driven Indian growth since 2003. Perhaps that reason, rather than globalfactors, persuaded non-government forecasters to reduce their forecasts to 5 per cent.

Translation: instead of spending on durable goods that will create value and drive future growth, the UPA, which was given a robust economy, has adopted charvaak neeti (take debt, but live well).
Ironic that the same newspaper had this to say:
http://www.indianexpress.com/news/industrial-growth-crashes-to-0.4-per-cent/397633/


And this same FM is now our Home minister. I pray he does not do the same 'magic' to our security.