Luxury from vegetables.

"Union Finance Minister Nirmala Sitharaman on Monday (yesterday) said that the current bank interest rates are a pain for borrowers and stressed the need for more affordable rates, particularly as businesses seek to expand." ET. Strange, because there seems to be no dearth of money for investment in India as initial public offerings (IPO) have been oversubscribed many times over. "The outlook for the Indian IPO market remains promising, with Pantomath Capital projecting that domestic companies could raise over Rs 1.5 trillion through IPOs in the next 12 months, signaling continued activity and strong investor interest ahead." ET. Also, "Promoter stake sales in the Indian equity market have reached multi-year highs," as "Retail investors, primarily through mutual funds, have been significant buyers of the stake sold by promoters." "According to a recent report by...Kotak Institutional Equities, promoters of 37 NSE 500 companies sold Rs 874 billion in the first half of the current year, marking the highest level in the past five years." Mint. All that money could be used for business expansion. Unless they want to borrow cheaply to buy assets. "Following a banner year for luxury car sales last year when several high-end car makers registered record sales, 2024 so far also been a positive year for high-performance vehicles and high-end SUVs." TOI. "Housing sales in India hit an 11-year high of 173,000 units between January and June, according to a report by global real estate consultants Knight Frank. The luxury housing segment contributed to around 41% of the real estate sector's sales growth from January to June." Mint. "A total of 25 ultra-luxury homes priced more than Rs 400 million were sold in Mumbai, Hyderabad, Gurugram and Bengaluru in the first eight months of 2024 for a collective sales value of approximately Rs 24.43 billion, Anarock data showed." HT. "It illuminates the country's plight, with its central bank constrained by high inflation from easing interest rates in response to signs of a slowing economy." Because, "For want of control over some vegetable prices, India's economic growth is suppressed." Mint. However, in August, "This being so, targeting inflation stripped of volatile fuel and fuel prices (to its core, i.e.) would surely ease RBI's job. While the idea of such a target switch is tempting, it is also inadvisable." High food prices hurt the poor badly and as the value of the rupee declines due to inflation, it "unfairly favors borrowers over lenders (and savers), since inflation reduces the real value of debt over time, unless loans are kept costly to compensate." Mint. Mint recommends that large private companies could bring inflation down by processing vegetables during seasonal production and then "could use their marketing skills and advertising resources to overcome another barrier: resistance to cooking with anything but fresh produce." But, if farmers get a lower price for vegetables they will stop producing them. Farmers anyway prefer to grow rice and wheat because "some states subsidize power and water, which helps ensure large scale cultivation," and "the Food Corporation of India, which is the procurement agency for the government, has an open-ended scheme under which it buys any amount of wheat and rice at the minimum support price (MSP)." "Therefore, there is a guaranteed return on capital," wrote Madan Sabnavis. A more effective idea is "The central government is likely to extend the term of RBI governor Shaktikanta Das, news agency Reuters reported." HT. That should bring down interest rates. You get what you give.