If we listen to our media, India is in a terrible state where the economy is doing very poorly, despite the Prime Minister's promise of 'achhe din', which means 'good days', the poor are suffering, because spending on the MGNREGA scheme has fallen, and Hindu Nationalists are running amok killing everyone. Seems that there has never been such suffering until the BJP government was elected last year. The media is incensed because the Prime Minister has put a stop to taking journalists on his foreign trips, where they enjoyed great food and drinks at taxpayer expense. Journalists love going to western countries and many probably have children studying or working there so they echo western press in its hostility to India. Civil servants are incensed because subsidies are being dispensed to the poor directly into newly opened bank accounts, which cuts off a source of extra income for our babus. Only Re 1 out of every Rs 5 spent on the MGNREGA scheme reached the poor so the spending on this has come down, causing great anger to the social workers and do-gooders who thrive on the lucrative business of poverty. Poverty is not only big business it is a fairly easy way to get a Nobel Prize in economics. Business men are disappointed that they cannot game the system by paying ministers and civil servants as in the past. Mines and telecom spectrum are being auctioned in a transparent manner, cutting off opportunities for massive scams as in the past. Not everyone is critical though. In an article one Rajiv Kumar, of the Centre for Policy Research, gives us a list of the achievements of this government. Credit to the corporate sector grew 10.2% in September, which may be a sign of increased investments. Corporate debt to equity ratio has declined to below 80% and will fall quickly once the economy starts to grow again. Sale of commercial vehicles expanded by 24.5% from April-May. Foreign Direct Investment, which is long term and not hot money, grew 10% during those months. Inflation has fallen to low levels allowing the Reserve Bank to cut interest rate by 0.5% last month. Capital expenditure of the government has increased 38%. This is going into infrastructure and to recapitalise banks and so is good for long term growth. The government has clamped down heavily on the cash economy, which has stalled the real estate sector. Apparently 100,000 fellows have fled offshore to protect their black money. It will take time for the economy to adjust to open transparent business when real growth will spurt. That is terrifying politicians of other parties who are used to living like kings on our money. It is amusing to see the Congress bleeding for our farmers when their condition has remained abysmal through 56 years of Congress rule. Too much wealth and power in poverty. No one wants to lose it.
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