Seems like deja vu all over again.

Chief Economic Adviser, Arvind Subramanian is incensed at rating agencies for not upgrading India's credit rating. "In recent years, rating agencies have maintained India's BBB- rating, notwithstanding clear improvements in our economic fundamentals (such as inflation, growth, and current account performance). At the same time, China's rating has actually been upgraded to AA-, even though its fundamentals have deteriorated," he said. Last month India questioned Moody's methodology when it too refused to upgrade our rating. In response Moody's pointed out that bad loans at banks have not been resolved, at 21% of GDP India's revenues are lower than the median of 27% for Baa- rated countries, debt situation is not as rosy as the government says and debt affordability is low. We have been through this loss of face many times before. In 2013, the Manmohan Singh government begged for a rating upgrade based on efforts to reduce fiscal deficit and trying to increase investment, completely forgetting that the mess was of the government's own making. This government is at the same stage as the Congress government was in 2007 when the economy was growing at over 9%, average retail inflation was at around 6% and the rupee was very strong, peaking at 39.26 to the dollar in January 2008. The Bombay Stock Exchange index reached a record 20,000. The Reserve Bank bought $78 billion to try and stop the rupee from becoming stronger and then had to issue Rs 2 trillion worth of Market Stabilization Bonds to mop up the excess liquidity. Now, as then, there is enormous liquidity in the market, mainly due to demonetization of high denomination notes on 8 November. The Sensex is at record territory. The real effective exchange rate of the rupee is 7% overvalued, hurting exports. Foreign investors poured $3.5 billion into government debt in April. Just this year a total of $14 billion have come into equity and debt. The government has changed the base year for calculating economic parameters to 2011-2012 from the previous base year of 2004-2005, which saw a jump in the growth rate of the GDP. Yesterday figures for inflation and industrial growth were released, based on the new base year. This shows that retail inflation has fallen to a record low of 2.99% in April, wholesale price index fell to 3.89% and industrial production rose by a whopping 5% in the financial year. Food has a large weight in retail inflation. Vegetable prices have jumped recently with tomato at Rs 24 a kg, bananas at Rs 50, onions at Rs 22, karela at Rs 54 and potatoes at Rs 19 a kg. So the new figures probably do not show the full picture. The Congress won the general elections in 2009 with an increased majority and then things fell apart. As Yogi Berra said,"It's deja vu all over again."