How do we understand what is going on in India? Our stock market index, the Sensex is on fire. It closed on 20,683 yesterday, within sniffing distance of its highest close of 21,004 on 5 November, 2010. The highest intraday high was 21,228. Experts are divided on how high it will reach, from 22,000-26,000. Foreign investors have put in $2.09 billion into Indian stocks between 2 and 27 September and taken out $965 million from the debt market, despite rising yields. In 2013 they have invested a total of $13.7 in our stock market while taking out $5.7 billion from our debt market. Why are they running away from debt? Is it because they do not trust our government's ability to to repay the loans? Figures are certainly bad. The September wholesale inflation rose to 6.46% from 6.1% in August while retail inflation rose to 9.84% in September from 9.52% in August. Food inflation rose to a blistering 18.4% from 18.18% in August. Industrial production rose by a paltry 0.6% in August while the HSBC Services PMI dropped to 44.6 in September from 47.6 in August. Anything below 50 denotes contraction. So, services, which comprise over 60% of the economy, is contracting and cutting jobs. This is partly due to inflation which is reducing demand and partly to the introduction of new taxes on every service. Instead of reducing and rationalising taxes the central and state governments are devising new taxes to levy on people. The European Commission published a list of 20 top destinations for direct investment in the world and India does not feature on the list.
Since the EU had direct investments of 5.6 trillion Euros in the rest of the world this is a great loss for us, especially because our infrastructure alone needs investment of $1 trillion. German newspaper Frankfurter Allgemeine recently wrote," Stealing in government has never been this brazen....Crime rates are up and security of life....is at its lowest ebb. India must then be more than qualified to be called a failed state." A failed state, thanks to Congress. One of our top newspaper crows how the US has snubbed Prime Minister of Pakistan, Nawaz Sharif while choosing to forget that the Obama administration has quietly resumed $1.6 billion of aid to Pakistan. Begging for approval. How pathetic is that?
Since the EU had direct investments of 5.6 trillion Euros in the rest of the world this is a great loss for us, especially because our infrastructure alone needs investment of $1 trillion. German newspaper Frankfurter Allgemeine recently wrote," Stealing in government has never been this brazen....Crime rates are up and security of life....is at its lowest ebb. India must then be more than qualified to be called a failed state." A failed state, thanks to Congress. One of our top newspaper crows how the US has snubbed Prime Minister of Pakistan, Nawaz Sharif while choosing to forget that the Obama administration has quietly resumed $1.6 billion of aid to Pakistan. Begging for approval. How pathetic is that?
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