If it works for them, why should they change?

"India has the potential to achieve a high GDP growth rate of around 10 percent and be a $10 trillion economy in the next 12 to 15 years, HUL CMD Sanjiv Mehta said on Monday." "There is very clear anecdotal evidence of growth rate in staples in urban India slowing down, which could be a very clear pointer that the urban poor are feeling the stress." "We should not let that happen -- we should definitely take the risk of being aggressive with spending." Hindustan Unilever is a large consumer goods company with sales of around Rs 350 billion. "In the last three decades, we have achieved about 6 to 6.5 percent on an average GDP growth rate", so we have to "dream big, think big and act big". Mehta is talking about real GDP growth which was 3.1% in the January to March quarter of 2020 and 4.2% in financial year 2019-20. Real GDP is calculated by adjusting nominal GDP for inflation according to prices in a base year. Since nominal GDP is at current prices it is larger and its growth rate is higher. Real GDP in India is calculated at 2011-12 prices and grew at 4.18% in 2019-20 while nominal GDP grew at 7.21%. India's GDP was about $2.9 trillion in 2019 according to World Bank data. Unfortunately, it contracted by 23.9% in the April to June quarter, which is the first quarter of financial year 2019-20 and is predicted to shrink by 14.8% in the entire year by Goldman Sachs, which will take it to around $2.5 trillion. Assuming a real GDP of $3 trillion it will take a compound annual growth rate (CAGR) of 8% to take it to $9.5 trillion in 15 years. Taking average inflation rate of 4%, the nominal GDP will have to grow at over 12% CAGR. Consumer price inflation (CPI) came in at 6.69% in August. Ruchir Sharma does not agree with Mehta that the government should be "aggressive with spending". Because, "we entered this crisis with one of the highest public debts and fiscal deficits in the world, especially in the emerging world", and "we've got to keep in mind that India's inflation is still more sticky compared to other countries in the world, even other developing countries in the world". Ir we try to print (notes) our way out of the crisis we will end up like Turkey, whose economy is in a real mess. "Our big business tycoons are a bigger threat to the growth of a liberal economy than politicians, because they want to do away with competition, harking back to our 'licence raj' days of Ambassador cars," wrote GR Gopinath. Foreign investors are tempted by politicians to invest in India but if rules are changed after they invest they will lose confidence. Crony capitalism is a cozy club of politicians, civil servants and business leaders. Why should they change?