We do not care about Moody's. Or, do we?

"Almost a year ago, ratings company Moody's Investors Service Inc. upgraded India's sovereign rating, making India only the second large emerging market (among emerging markets in the G20 group of economies) to have improved its rating in the past five years," wrote T Kundu. Moody's mentioned three risks to India -- "increase in external vulnerability, a 'material deterioration' in fiscal metrics and  slide in banking health. All of these three risks materialized subsequently, in varying degrees". Since the upgrade, "India has witnessed the sharpest non-resident portfolio outflows (equities and debt combined) among major emerging market (EM) economies over the past year". Oil prices have gone up, the rupee has fallen, both current account and fiscal deficits are increasing, banks are still grappling with bad loans and non-banking finance companies have been hit recently due to the IL&FS scam. The only silver lining has been the recent fall in oil prices due to higher production of shale oil in the US and temporary waiver to eight countries from sanctions on Iranian oil. In response, Saudi Arabia, an implacable enemy of Iran, has announced a cut in oil production to support the price of crude. "The estimated number of persons employed during October 2018 at 397 million was 2.4% lower than the 407 million persons employed in October 2017," said a report by the Centre for Monitoring Indian Economy. It is not just that there are no jobs but whatever jobs are available are low paying, with low productivity. The introduction of the Goods and Services Tax has apparently created loads of temporary jobs in various industries because of formalization of the economy. These jobs are unstable and do not lead to increase in the standard of living because there is no prospect for the future. A senior manager at Tata Steel was shot dead a few days back by an employee sacked for indiscipline. The employee had been unable to find a job after his sacking. According to a report by HSBC, GST has failed to formalise the economy. But according to a politician of the BJP, GST has been highly successful because it has expanded the tax base. So, while people are looking for ways to survive politician are looking for their pound of flesh. Higher taxes are necessary to pay government employees who are the most pampered in the country. Retail inflation fell to 3.31% because of a fall in prices of vegetables, pulses and sugar. This despite higher oil prices, a weak monsoon and higher minimum support prices. Industrial production is erratic. Does it mean that consumer demand is falling off? No wonder Modi wants to loot Rs 3.6 trillion from Reserve Bank reserves to stimulate the economy with handouts. What will Moody's say about that?