Lightning strikes are a sign of things to come.

Although they look fearsome lightning strikes are usually far away from populated areas and very limited in range. That is why fatalities are rare. But not in India. Our population density is so great that 32 people, including 9 children, were killed over the weekend in Bihar and Jharkhand. Of course, when people breed like rabbits poverty keeps on rising which is good news for our politicians who can easily buy votes by bribing them with a plethora of social schemes. Unfortunately, social schemes have to be paid for by increased government borrowing which increases fiscal deficit, leading to high inflation, increases borrowing costs for private businesses through high interest rates and a fall in the growth rate, leading to lower growth in tax collections, which makes the deficit worse. The only remedy is reducing government expenditure but cutting social schemes would be electoral suicide. So taxes are increased to unbearable levels, further hitting the middle class and depressing demand. Suddenly the Congress has woken up to the fact that crushing the middle class is catastrophic for industries such as cars, refrigerators and internal tourism. Now our most revered Finance Minister has asked the Reserve Bank to lend money to banks at low rates of interest so that they can be passed on as customer loans. This is after the RBI instructed banks to stop all zero interest loans to retail customers. " For a long time we have harboured the myth that banks are meant to provide money to rich people and to corporates. Nowhere in the world, other than India, do corporates come to banks for working capital," said our Finance Minister. Er, quite. The reason that rich people prefer to borrow from banks, especially public sector ones, is that they can divert the money for private consumption or to other projects and they are sure that if they are unable to repay the loans they will be " restructured " and eventually written off. They can get away with the loot because they are either related to, pally with or have paid politicians to put pressure on bank managers. Sadly, economic decisions made in panic seldom work and trying to increase consumption with sky high taxes and inflation is doomed to failure. Trouble is that when such a huge country starts to hurtle downwards short term measures do not work. Perhaps lighning needs to strike our politicians.