It's the economy. As always.

A recent report from the United Nations Conference on Trade and Development, or UNCTAD, said that the Indian economy faces "serious downside risks" and growth in 2017 is going to be 6.7%. R Kozul-Wright, UNCTAD economist, was scathing about "rentier capitalism" in many countries. "The rise of financial rents and the proliferation of rent-seeking activities reinforced by austerity economic policies in country after country have led to capture of political processes and continued economic stagnation and rising inequality," he wrote. He recommends public investment and full employment financed by progressive taxation. India has already embarked on aggressive taxation by enforcing demonetization, linking all services with biometric identity cards and the Goods and Services Tax, or GST. Some people blame these for the slowing of economic growth but Prof S Mundle wrote that their effect has been "relatively modest and temporary". "The slide in growth had started well before either of these shocks hit the economy." "Growth today is rather like the flight of a six-engined plane where one engine is going full throttle while the other five are slowing or shutting down. The engine propping up growth is government final consumption expenditure." There are 3 bears to one bull, wrote M Chakravarty. The bull view is that the shocks have been weathered and now the economy will roar ahead. The 3 bears, Baby, Big and Extreme, predict that India is trapped in a middle-income zone and cannot take the way of exploiting cheap labor, as China did, and as prices of commodities rise. The main reason is the inability of Indian businesses to deal with disruptive technologies, that are rampant today, wrote Prof R McGrath and M Muneer. "The tenure of companies on the S&P 500 has declined from 61 years in 1958 to 18 in 2012." "Most Indian companies in India stick to a business model and execute against it repeatedly, although shoddily." They need to innovate and take risks with new business models. Even a hugely diversified company like Tata gets 70% of its profits from TCS. India is not the only one caught in such a trap. The US has also lost its manufacturing, wrote Prof Noah Smith. The only way out is to encourage exports because that is the way to increase competition, leading to innovation and higher productivity. Our exports cannot grow because we import everything, wrote Prof D Gupta. We need snake oil, and quickly. Which in India means cut interest rate. Trouble is that retail inflation went up to 3.36% in August from 2.36% in July, just as industrial production went up 1.2% in July after falling in June. To reduce inflation quickly the government could cut fuel prices by bringing it within GST, but then, deficit will rise. General elections in 2019. Need help badly.