We need medicines for people not for elections.

Seems that the growth in the pharmaceutical sector has been slowing down. TOI, 23 April. Usually this sector is recession-proof because you must take medicines if you fall ill but apparently, with the slowdown in the economy, this sector has also been slowing down. Growth was 5.3% in November, 4.3% in December, jumped to 10.8% in January, then dropped to 7.9% in February and further to 5.6% in March. That is surprising because the winter season, from the middle of December to the middle of March is the healthiest time of the year in India. Chronic illnesses, such as diabetes, remain constant but blood pressure and heart problems tend to worsen in winter. However, with the onset of summer asthma, viral infections and especially abdominal infections rise dramatically increasing medical costs for households. Thus the spike in January is somewhat surprising. The real reason maybe that people, especially the poor, have less disposable income because they are spending a lot more on food and other household products because of consumer price inflation at over 10%. We are told that this is because of supply side constraints but India has been having bumper crops for the last 2 years so it is difficult to see how supplies can be increased any further. Any responsible government would devote all its energy to controlling inflation but everyone in the government has been howling about reducing interest rates because that will improve growth. Maybe, but how will it improve supplies of food? Would the inflation not get much worse because of increasing demand? The clue might be in a report by Karvy Stock Broking which says that the recent crash in the price of gold may lead to a fall in prices of properties in India. They reason that as gold prices fall it will become more affordable allowing more people will invest in this metal. TOI, 22 April. Using data from Hong Kong and India the report shows that there is a correlation of 0.81, which means 81%, between the prices of gold and real estate. " Now the recent correction ( of about 17-20% ) offers an opportunity for investors to switch from real estate to gold. The most impacted markets could be the ones which have high investor concentration, that is NCR ( including Gurgaon ) and Mumbai," said the analysts. Real estate is where the real black money is and politicians and civil servants have the most black money. They therefore stand to lose the most if there is a correction in property prices. By reducing interest rates they want to shift the cost of the falling growth rate away from borrowers to savers. Hopefully this will protect banks and encourage people to spend more on products that need loans, such as cars. The whole idea is to somehow postpone the  day of reckoning till after the elections. After that, who cares.