The bears are here.

The Reserve Bank of India (RBI) is to pay a 'dividend' of Rs 2865.8846 billion (around Rs 2.87 trillion) to the Central government for the accounting year 2025-26. "This year's dividend payment by the central bank is 6.7% higher than the previous year's Rs 2.69 trillion," and that was 27% higher than the year before. This constitutes 90.8%of budgeted non-tax revenue of the Centre but is less than the rs 3.16 trillion demanded by the Budget. DH. The RBI's balance sheet rose 20.61% to Rs 91.97 trillion as on 31 March 2026. "India's foreign exchange reserves fell by $8.09 billion to $688.89 billion in the week ended 15 May, according to data released by the RBI." Foreign currency assets fell $6.48 billion to $545.90 billion. ET. Was the RBI selling foreign currency to defend the rupee even though "Allowing the rupee to weaken" "raises the cost of imported goods and overseas travel in rupee terms, encouraging households and firms to economise on precisely those expenditures that strain the balance of payments," advised Prof Gita Gopinath. And, Chairman of the 16th Finance Commission, Arvind Panagariya posted on X, "Do not let the psychology of Rs 100 per dollar determine your policy response. 100 is just  number, like 99 and 101." News18. Clearly he does not watch cricket, where 100 is celebrated as a century and 200 or 300 are counted as centuries in a batter's record. wikipedia. Retailers have long known that items priced at 99.99 are seen as cheaper than one priced at 100 by customers. News18. Sources told Reuters that "Within the central bank, there is a clear consensus that utilizing interest rate hikes to defend the currency would be counterproductive." And that, "the central bank prioritizes inflation control and economic growth over currency defense." ET. A fall in the value of the rupee will increase the value of imports and cause inflation. In addition, petrol and diesel prices were raised for the third time in less than 10 days - first by Rs 3, then by Rs 0.90 and now by Rs 0.87, for a total of nearly Rs 5 per liter. Mint. The government probably thinks that increasing prices furtively by small increments will not be noticed by people, but this will immediately add to transport costs and increase prices across all goods and services. Already, commercial vehicle drivers' unions in Delhi-NCR have called for a three-day strike in support of an increase in fares. TOI. "India's central bank may need to draw on its 2013 taper tantrum playbook and earlier balance-of-payments crises to mount an effective defense of the beleaguered rupee." This might involve selling dollar bonds abroad to increase foreign exchange reserves. "But any deposit plan or bond issuance will come at a steep cost as interest rates have risen sharply globally. Banks offered deposit rates of 3.5% to 5% in 2013, but would likely need to pay at least 8% to 9% to attract funds, said Madhavi Arora, economist at Emkay Global Financial Services Ltd." ET. We are told that the macro situation is much better than it was in 2013, when India, Indonesia, South Africa, Brazil and Turkey were labeled as the 'Fragile Five' because of their large current account deficits. BBC. Why the panic now, when, in December, RBI Governor Sanjay Malhotra bragged about a "rare Goldilocks period" for the Indian economy? DD News. The fear may be, "If RBI is seen to be intervening heavily and is yet unable to arrest the rupee's fall, markets may conclude that the central bank is losing the battle." If that happens, "Exporters delay repatriating export proceeds, Importers rush to prepay for shipments. Households buy gold and dollars," wrote former RBI Governor Duvvuri Subbarao. "The RBI sold a net $53.13 billion in the spot foreign exchange market in FY26" (BS), "has a short dollar book close to $100 billion in offshore and onshore markets" (Subhadip Sircar), has bloated its balance sheet to Rs 91.97 trillion and has handed over a cash bonanza of Rs 2.87 trillion to the government. So what are the RBI's options if it refuses to increase interest rates? Borrow abroad at 8-9%, which will deplete reserves, or print rupees by the sackful, which will tank the rupee. The bears have come for Goldilocks. Run. 

Mediate or fight.

Last Easter, "Catholic priests in dioceses across the United States welcomed the largest classes of converts they had seen in 15 or more years." And, "A former intelligence official testifies under oath that the US has been secretly retrieving and reverse-engineering crashed UFOs for decades, and that nonhuman 'biologics' have been recovered. Demonic vexation, teleportation, increased interest in religious practice - these phenomena are all signs that life feels, to many, increasingly charged with unseen forces. You might say it has been re-enchanted." DH. Not just the US, the Middle East is also getting weirder. "Pakistan's army chief is in Tehran as diplomacy around the Middle East war gathered pace," even as "US media outlets were reporting that the US is weighing new military strikes on Iran." Field Marshall Asim Munir "was welcomed by Iran's Interior Minister Eskander Momeni and Pakistan's Mohsin Naqvi. Naqvi had visited Iran for the second time in a week.., meeting President Masoud Pezeshkian and Foreign Minister Abbas Aragchi." TRT. Since Pakistan shares a 909 km (565 miles) border with Iran (wikipedia), its efforts to help Iran reach a deal with the US would be normal, except that Pakistan has signed a Strategic Mutual Defence Agreement (SDMA) with Saudi Arabia, under which "both countries have committed to treating any act of aggression against one as an act against both (known as collective security) (wikipedia)." Iran attacked Arab countries between 28 February and 18 March 2026, during which, "Saudi Arabia was hit with at least 38 missiles and 435 drones." wikipedia. Following which, "Saudi Arabia launched numerous, unpublicized strikes on Iran in retaliation for attacks carried out in the kingdom during the Middle East war," marking "the first time that the kingdom is known to have directly carried out military action on Iranian soil." Reuters. In addition, "Pakistan has deployed 8,000 troops, a squadron of fighter jets and an air defence system to Saudi Arabia under a mutual defence pact, ramping up military cooperation with Riyadh even as Islamabad serves as the main mediator in the Iran war." "Pakistan has deployed a full squadron of around 16 aircraft, mostly J-17 fighters made jointly with China," a Chinese HQ-9 air defence system and may deploy up to 80,000 troops in Saudi Arabia if necessary. Reuters. Though Pakistan achieved independence in August 1947 (Britannica), "Till mid-August 1954, when it finally adopted Qaumi Taranah, the newly founded country had a flag, a governor-general, an army, and a blood-soaked disputed frontier with India, but no official song to give voice to its identity." "Thereafter, when it finally settled on an anthem, it was overwhelmingly Persian in content." The Wire. They did not adopt a song in Urdu because Urdu developed in northwestern India and was known as Hindustani at one time. Urdu is derived from Arabic and Persian, while Hindi is derived from Sanskrit. Britannica. And yet, though Pakistan has over 70 languages, Urdu is its national language and "while sharing official status with English, it is the preferred and dominant language used for inter-communication between different ethnic groups." wikipedia.  Their national anthem is not in their national language. How weird is that? Also, while acting as a mediator, will Pakistan attack Iran if there is open war between Saudi Arabia and Iran? Pakistani troops will be fighting Persians while singing their national anthem in Persian. In India, the Cockroach Janta Party (CJP) has more followers on Instagram than the ruling BJP. ET. People seem to be doing weird things because they have lost faith in their governments, but are powerless to do anything to politicians and civil servants. No way to show their frustration.   

CJP could be the answer.

To boost manufacturing, a 'Make in India' initiative was launched by Prime Minister Narendra Modi on 25 September 2014. The aim was to increase the growth rate and, as a result, the share of manufacturing to 25% of GDP by 2022. In fact, the share of manufacturing has fallen from 16.7% of GDP in 2013-14 to 15.9% in 2023-24. wikipedia. In May 2026, "India is preparing a fresh manufacturing push centered on identifying nearly 100 products that are either not produced domestically or are inadequately manufactured despite existing capability, signalling a sharper industrial policy focus amid shifting global supply chains, geopolitical tensions and the country's ambition to emerge as a global manufacturing hub." TOI. "The manufacturing activity's share in the GDP has declined to 13% in 2024 compared to 16% in 2015," because, "India's manufacturing growth is constrained by low spending on research and development (R&D) at just 0.6% of GDP and it should increase to 2% by 2035." ET. Countries "trying to emulate the East Asian model would produce, at best, manufacturing enclaves, with a tiny sliver of productive firms integrated into global value chains while the bulk of the labor force remains stuck in low-productivity activities," wrote Prof Dani Rodrik. "Competing successfully on world markets and with China at home requires skills, technologies and other capabilities that are in short supply," and "The result is that even when countries manage to pull more workers into manufacturing, this happens through the expansion of small-scale, mostly informal, enterprises and at the expense of productivity." Chief Economic Advisor V Anantha Nageswaran and Finance Minister Nirmala Sitharaman have complained about lack of investment by the private sector even though profits have increased by 30% since the pandemic. Mr Nageswaran blames "nepo babies" who choose to set up family offices elsewhere and live on passive investments rather than risk in new ventures. "The real reason India's richest don't want to invest domestically - and, possibly, why they take some of their cash abroad - is because they estimate local political risk as being too high." "If they earn money in India, their first instinct is to try and diversify geographically, so they escape New Delhi's control as much as they can." And if Indians are reluctant to invest here, why would multinationals? wrote Mihir Sharma. To protect Indian industries from competition the government raised tariffs on imports. "As of 2024, the average tariff on non-agricultural goods in India stood at 13% compared to significantly lower rates in China (6.5%), Malaysia (5.3%) and Vietnam (8.3%)." "In parallel, the government has significantly expanded the use of Quality Control Orders (QCOs) especially since 2020." CSEP.  And so, "A report by the Global Trade Research Initiative (GTRI) warns that QCOs on fasteners are raising costs, choking supplies and disrupting production." "cutting MSME output and risks triggering bottlenecks in sectors such as automobiles and infrastructure." "Fasteners - bolts, nuts, screws, washers, rivets and studs - are produced in thousands of variants, often in small batches on the same machine." QCOs are restricting production. ET. "Large companies and factories have failed to generate jobs at the pace required to absorb a growing labor force. In that vacuum, the unorganized sector - small shops, workshops, grocery stores, tiny manufacturing units and street vendors - remains the fallback." "For 2025, the government estimates 79.2 million such entities, up from 73.4 million in 2023-24. These enterprises generated about Rs 20 trillion in output in 2025, compared to Rs 15.4 trillion in 2025-16." But, "Their share in India's value added has fallen from 9.1% in 2015-16 to 6.3% in 2025." Mint. Since profits have fallen, growth in wages of workers has stagnated. Wages of non-unionised contract workers have stayed at between Rs 10,000-15,000 per month for years and are insufficient to pay for rent and food. Workers in Haryana and Noida protested last month. BBC. Perhaps, it would be best if the government stayed out and didn't try to help. But control is power, and a life of no restraint. The Cockroach Janata Party (BBC) represents the mute. CJP could be the answer. Vote CJP.

No question, we have yoga and vaccines.

As Prime Minister Narendra Modi "walked away after a joint press conference with Norwegian Prime Minister Jonas Gahr Store, journalist Helle Lyng called out to him, asking why he does not take questions, but got no response." "Modi has not held a traditional press conference since taking office in 2014, and has rarely answered questions on his trips abroad." BBC. "The gagging of the Indian media now normalized after 12 years of a government obsessed with evading questions, either outrightly denying data, or not making data accessible. It is capped by zero press conferences by the prime minister - a first in independent India." "Later, Lyng was invited by the Indian Embassy - publicly on social media - to a presser by diplomats," where "she was told, incredibly, that India is the land of yoga, has handled Covid well, and exports vaccines and medicines." The Wire. No wonder, "India is 157th out of 180 countries in the 2026 World Press Freedom Index released by Reporters Without Borders on 30 April." It's a drop of 6 places from 151 in 2025. The Wire. Who cares? We have yoga and Covid vaccine. The whole world must think we are a nation of mindless apparatchiks (wikipedia) programmed to babble inanity to protect Dear Leader from any accountability. China-based analyst Keji Mao recalled "presentations he had delivered years ago on China's industrial and technological ecosystem." The Vietnamese "listened carefully when he discussed the gaps between Vietnam and China," and "they openly acknowledged Vietnam's shortcomings and even asked for deeper analysis on areas where the country lagged behind China's industrial model." Indians, on the other hand, became "'quite argumentative' and attempted to challenge the Chinese participant on every point raised." BT. Contemptuously dismissing any comparison, Victor Gao, Vice President of the Center for China and Globalization, said, "We are probably minimum 20 years, if not 30 years, apart from each other in terms of economic development, science and technological development." BT. In the Netherlands, just before Mr Modi arrived, Prime Minister Rob Jetten said that "there were concerns among the Netherlands and other EU member states about 'developments in India' under Modi's BJP." To that MEA Secretary Sibi George pointed to India's 1.4 billion people, massive voter turnouts and a 'noisy democracy' powered by 900 million smartphones. The Wire. Voter turnout has been curtailed by Special Intensive Revision (wikipedia) just before elections with no time for corrections. In Bengal, "The BJP secured 292,24,804 votes against the TMC's 260,13,377: a margin of 32,11,427 votes that translated into a 127-seat lead. This is significantly lower than the 9.1 million voters deleted during the revision, and even lower than the 6.6 million voters removed for reasons other than death." DH. Definitely does not pass the smell test (idioms), the stench of rot still lingers. As for smartphones, India had the second highest number of internet shutdowns in 2024, after Myanmar. TOI. "The issue before the world is not whether India is an ancient civilization," It is. "The real question is whether modern India, government by a Constitution that promises equality to all citizens, is living up to those promises today," wrote AJ Philip. Ask no questions and you'll be told no lies. For some of us, a government that refuses to explain itself is fascist. But, we have yoga and Covid vaccine. So, there.

Not just a piece of paper.

"The rupee declined 10.8% in FY26 since the closing levels of last fiscal year - recording the worst performance since FY12. Much of this decline came during the pre-war period, even when the dollar was weakening, and other currencies were gaining," wrote Payal Bhattacharya. "India's close to $700bn in foreign exchange reserves will not run out because of higher imports. The only way reserves get depleted is if RBI decides to sell foreign exchange reserves to support the rupee." A weaker rupee is good. "A depreciation raises the cost of imported goods and overseas travel in rupee terms, encouraging households and firms to to economise on precisely those expenditures that strain the balance of payments. In doing so, it delivers - more effectively and more durably - the shift towards domestic spending that voluntary restraint seeks to achieve," Prof Gita Gopinath. India is losing foreign exchange as foreign institutional investors (FIIs) are selling Indian stocks. "FIIs have been net sellers in 13 out of the past 20 months." In 2025, FIIs sold Rs 1.66 trillion in equities and bought Rs 947 billion of debt. But, "Since the US-Israel war with Iran began at the end of February, FIIs have sold Rs 2.03 trillion in equities and also pulled out Rs 125.12 billion from debt." Domestic institutional investors (DIIs) have been buying as FIIs have sold out. DIIs now hold 19.24% of the NSE-listed companies while FIIs hold 16.13%. In December 2020, FIIs held 21.16% while DIIs held 13.58%, wrote Sreedev Kanyakumar. Buying by domestic investors prevents any significant fall in share prices, limiting losses of foreign investors and repatriation of more foreign exchange. Since Sanjay Malhotra took over as Governor of the Reserve Bank of India (RBI) in December 2024, the RBI has slashed its interest rate by 125 basis points (bps) and also pumped nearly Rs 20 trillion into banks to bring down borrowing costs. "Yet, the funds simply leaked out of India's banking system as global money managers dumped local assets and took dollars home," wrote Andy Mukherjee. The RBI has been buying up government debt and "the amount of government paper (including treasury bills) held as on 28 February was Rs 21.34 trillion. It was Rs 15.58 trillion in March 2025." "Starting from automatic monetization, under which 4.6% of treasury bills were once issued by the government to RBI for funding the deficit," "In the 90s, we shifted to the market becoming the sole point of contact for the government." "However, with frequent OMOs (open market operations) in recent times, there has been a tendency for that debt to be transferred to RBI and held by it," wrote Madan Sabnavis. There has also been an "extraordinary rise in RBI's surplus transfers to the Union government. In 2023-24, it transferred Rs 2.11 trillion, which was 7.6% of the Centre's overall revenue receipts. The transfer for 2025-26 may be even larger than last year's record Rs 2.69 trillion." The International Monetary Fund (IMF) has warned of "quasi-fiscal" support by the RBI, wrote Ajit Ranade. The rupee has fallen not just against the US dollar but by nearly 12% against the Pakistani rupee and by 10% against the Bangladesh Taka. ET. The steep depreciation in the rupee is unfair because India has a low current account deficit, low external debt and is bringing down its fiscal deficit. India has also received a credit rating upgrade from three institutions. It is because of the flood of investment into artificial intelligence (AI) companies drawing funds away from emerging market economies, regardless of fundamentals, wrote Chief Economic Advisor V Ananatha Nageswaran. Theoretically, a central bank cannot go broke because it can print currency (ET), but printing currency makes it weaker, and if the currency keeps losing value, the wealth of the people and the country will become worthless. India may not be bankrupt but its citizens will feel like that. The rupee is not just a piece of paper. It is food, medicines, rent, education and travel for us. Say no to fiscal support. It's suicide.    

Free but expensive.

"Nitin Gadkari, the Minister of Road Transport and Highways in India, has urged a strong initiative towards achieving 100% ethanol fuel usage in the country in the near future." "E100 refers to a high-ethanol fuel blend that is primarily or nearly pure ethanol by volume." NDTV. Ethanol is produced from sugarcane, rice and maize. "Roughly 10,790 liters (of water) go into producing one liter of ethanol from rice, compared with about 3,630 liters for sugarcane and 2,570 liters for maize." Also, "Nearly 60% of maize is rain-fed, while sugarcane and rice depend heavily on irrigation." However, the rice has already been produced so it may be better to use it for ethanol rather than letting it go to waste. While ethanol will save foreign exchange by reducing crude oil imports, we may have to import more pulses and oilseeds as farmers divert land to growing maize. Since ethanol produces less energy than petrol, consumers will have to buy more of it, and it produces acetaldehyde and formaldehyde which are toxic. NDTV. "Ethanol burns faster than petrol, delivers about 34% less energy per unit, and is corrosive because it absorbs water. Brazil's flex-fuel vehicles (FFVs), re-engineered to run on ethanol, are built to counter these drawbacks and reassure buyers." The Indian government has reassured car owners of ethanol's safety but no one believes them. Earlier claims that ethanol will be cheaper were wrong. "By govt's own admission, procuring ethanol is now more expensive than refined petroleum - a situation that will only worsen as our fuel needs grow," wrote Anjana Menon. To save on fossil fuels and reduce pollution India has been investing in renewable energy. As a result, "Power prices on exchanges have slumped to zero in multiple trading sessions, despite an expected surge in summer electricity demand," because "India's installed solar capacity has risen to 154.23 GW, but battery and energy storage capacity has not kept pace." Mint. Power distribution networks within states are patchy. "Non-fossil sources already account for nearly half of installed capacity, with over 250 GW deployed, yet contribute only about a quarter of actual power generation." And so, "Between May and December, 2.3 terawatt-hours of solar power was curtailed. In Rajasthan, curtailment has reached 50%, with 3.3 GW lying idle." HT. "India is scrambling to solve a growing clean-energy paradox: the country is adding renewable power at record pace, but lacks the storage capacity needed to to use that energy when the sun sets and wind generation drops." The Union government is planning support for long-duration energy storage (LDES) which can supply power for over eight hours instead of battery energy storage systems (BESS) which can supply up to four hours. The plan was for 47 GWh of LDES by FY 27 but only 795 megawatt hours (MWh) of BESS has been installed so far. Mint. The government wants people to use public transport to save on petrol. Since 2014, the government "has splashed out nearly $26bn on building metro connectivity across nearly two dozen Indian cities. The network has grown fourfold from under 300km to more than 1,000km by 2025." Average daily ridership has jumped from three million to 11 million. But, "An Indian Institute of Technology Delhi report from 2023 showed ridership of merely 25-35% of the projected figures across corridors." BBC. Renewable energy is not cheap because we need a parallel system based on fossil fuels when the sun sets and the wind drops. "Ask families in Germany and the UK what happens when more supposedly cheap solar and wind power is added to the national mix, and they will tell you by looking at their utility bills: power gets far more expensive," wrote Bjorn Lomborg. "Poor countries are especially hurt by false claims of cheap green energy." Having pocketed over Rs 40 trillion from extortionate taxes on cheap crude oil since 2015 (ppac.gov.in), the government is now in extreme panic. If they cut taxes the fiscal deficit will balloon while increasing prices will cause inflation and public anger. So they are increasing prices by small amounts, first by Rs 3 and then by Rs 0.90. (TOI), hoping people will not notice or shrug off small increases if they did. Masters of duplicity. Diabolical.   

It's 60+3.

"India's services exports touched $421.3 billion in FY26, surpassing $418.3 billion estimated earlier, boosting total goods and services exports to a record $863.1 billion last fiscal year, an official said." "Merchandise exports grew 0.93% in FY26 to $441.78 billion from $437.7 billion in FY25." ET. This glowing report of our export growth omits to report on our imports, and hence, our trade balance. Our combined (services + merchandise) trade resulted in an estimated deficit of -$119.30 billion in FY26, compared to -$94.66 billion last year. pib.gov.in. "India's merchandise trade deficit widened to $28.38 billion in April," compared to $20.67 billion in March. Merchandise exports rose to $43.56 billion in April from $38.92 billion in March, while imports jumped from $59.59 billion in March to $71.94 billion in April. Estimated services exports stood at $37.24 billion and imports at $16.66 billion. ET. "India's trade deficit is likely to remain under pressure in the coming months as elevated crude prices, supply-side disruptions and potential global demand slowdown weighed on exports, according to Nuvama Institutional Equities." Rupee depreciation could increase competitiveness and the increased duty on gold will provide some short-term relief. Electronics deficit jumped from $0.7 billion to $7.6 billion. ET. Not just gold, petrol and diesel prices were also increased by Rs 3 per liter, while the price of CNG, used by all public transport in Delhi by law, was increased by Rs 2. TOI. This was apparently necessary because, "Amid high oil prices. state-run oil marketing companies (OMCs) are losing Rs 20 per liter on the sale of petrol and around Rs 100 on diesel sale, said Sujata Sharma, joint secretary, Ministry of Petroleum and Natural Gas." "On 27 March, the finance ministry reduced the excise duty on petrol and diesel by Rs 10 per liter." So this is an increase of just 4%. Mint. We should be pleased because the price of fuel has gone up only 3.2-3.4% in India it has gone up by 44.5-48.1% in the US, 23.8-50.6% in Vietnam and 15.4-19.8% in Italy. MC. Are we so lucky, or is this just another example of our 'Godi (lapdog) Media' (wikipedia)? "A widely -shared chart posted by many pro-government journalists on social media highlights that India's recent fuel hike was as low as 3%, while countries like the US, UAE and Canada saw spikes ranging from 30% to 80%." This is due to Base Effect, because India's retail prices of fuel were very high compared to other countries when crude prices were low. Comparing retail prices in 2016 with today's, prices in India have jumped by 63%, in Vietnam by 60%, in the US by 36% and in Italy by 34%. That is because Prime Minister Narendra Modi has been taxing fuel without restraint. Taxes comprised Rs 46 out of the retail price of Rs 64 per liter in 2016, Rs 60 out of Rs 80 in 2020 and Rs 62 out of Rs 95 per liter in 2021. The Wire. Increasing the price of fuel will increase transport costs of all goods and services. "India's retail inflation quickened to 3.48% in April, driven by dearer food prices, government data showed." Reuters. So, they must be hoping that it will remain within the government target of 4% +/- 2% on either side  (Reuters). It is not just high prices but also the rupee which has dropped to 96.30 to one dollar this morning (xe.com). This will increase the cost of all imports and, since higher prices mean a lower value of the rupee, as prices rise the rupee will fall even further. The only solution may be to increase interest rates by a hefty amount, say 100 basis points. That will reduce consumption, and support the rupee by increasing 'carry trade' in which traders borrow currencies with lower returns and invest in one which gives higher returns (Investipedia). It will increase returns for savers.But, it may also cause a severe recession and a fall in share prices. And so, will need guts and character. Not for weasels.        

Another in a long list.

"First came the corona(virus) pandemic; then wars began to break out, and now there is an energy crisis. The decade is turning into a decade of disasters for the world," Prime Minister Narendra Modi said in the Netherlands," (HT) where he was speaking to the Indian diaspora during his latest foreign tour. It is easy to blame everything on global events when our problems were created by how the government responded to those events. "On 25 March 2020, when India had reported only 500 cases, the country went into what was one of the strictest lockdowns in the world. This first set of curbs remained in place till 14 April and was extended four times, each time with gradual relaxations." HT. As a consequence, "India's economy suffered its worst slump on record in April-June, with the gross domestic product (GDP) contracting by 23.9% as the coronavirus related lockdowns weighed on the already-declining consumer demand and investment." TNIE. And yet, when so many millions were dying of Covid in 2021 that crematoriums had to create pyres in car parks (BBC), there was no lockdown. In May 2021, "India's holiest river the Ganges, has been swollen with bodies in recent days." BBC. Consumer demand and investments were declining because of an ill-considered demonetisation of Rs 1000 and 500 banknotes on 8 November 2016 with just 4 hours notice (wikipedia) so the GDP growth rate fell from 8.3% in 2016 to 6.8% in 2017, 6.5% in 2018 and a dismal 3.9% in 2019, the last full financial year before the Covid pandemic struck (worldometer). One theory was that it was designed to hamper the campaigning ability of opposition parties before the assembly election in UP which the BJP won in a landslide with 312 seats out of a total of 403 (elections. in). The medium, small and micro enterprises (MSME) which operate mainly in cash, constitute 45% of the country's output and employ 60 million people, were badly hit. ET. The Reserve Bank of India (RBI) played an active part by choosing masterly inactivity when retail inflation was at a scorching 6-7% (RI) well above the government mandate of 4% with a margin of 2% on either side (ET). The RBI cut its "short-term lending rate on 22 May 2020, in an off-policy cycle to perk up demand by cutting the interest rate to a historic low." It kept the rate unchanged 11 times at 4% till April 2022. zeebiz. com. Retail inflation was at 6.28% in May 2020 when it took its disastrous decision. Rising prices mean a falling value of the rupee. The rupee was at 70.96 against one dollar in January 2020 but had fallen to 73.78 by December. Thomas Cook. The rupee is flirting with 96 to one dollar this morning. xe.com. Mr Modi has asked people for austerity, telling them to work from home, to use public transport, not to buy gold and not to use cooking oil. ET. A report by Brickwork Ratings said that austerity could save $37.8 billion for the government. "The report argues that voluntary demand reduction across fuel, gold and fertilisers may offer the government fiscal breathing room at a time when its ability to absorb oil prices pass-through is thinning." ET. But, could this be another blunder on the part of this disaster-prone government? "Austerity programs employed after the 2008 financial crisis in Greece, Italy and other European countries led to long recessions in many of these countries. Similar experience was reported by Latin American countries that went for austerity after the commodity price collapse of 2014-15 fared poorly too," wrote Prof Himanshu. Is Mr Modi preparing Indians for a depression, with spiking inflation and a collapsing rupee by blaming everyone else and relying on his zombie Bhakts living in an alternate reality (DH) to swallow his bluff as they have been doing all these years? The end could really be nigh. For Indians.