There is an empirical observation that those countries that escape a particular financial crisis (and pat themselves on the back) are quite likely to fall prey to the next financial crisis.
There was an orgy of self-congratulation and complacency about the wisdom of the Indian 'third way' when the West self-destructed and India did not. That chicken may now be coming home to roost.
The second reason is structural: The Congress is happy with a certain economic climate; and if presented with any other, they will quickly convert it into what they like.
Thursday, May 24, 2012
Rajeev On The Rupee Debacle
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2 comments:
I still do not get how people claim that the Indian economy's real growth rate is positive. Are inflation figures of 9-10 % put out by govt to be trusted?
Nominal growth is at ~17% or less. Both the US dollar and gold have appreciated by much more than 20% against the rupee. Inflation figures can not be far from these as it would imply huge arbitrage opportunities otherwise.
Therefore, real growth rate of Indian economy may be closer to 17% minus 20%, or minus 3%.
'The second reason is structural: The Congress is happy with a certain economic climate; and if presented with any other, they will quickly convert it into what they like.' Interesting idea. Could you please write more posts talking about this? Much appreciated!
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