Treat the cause.

There is speculation over whether RBI Governor Shaktikanta Das will receive another extension to his tenure. TOI. That is because, "India's real GDP growth stood at a 7-quarter low of 5.4% in Q2FY25, well below India's potential GDP growth of 7-7.5%." BS. "Finance Minister Nirmala Sitharaman and Commerce Goyal Piyush Goyal have both called for lower borrowing costs in recent months." "The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) on Wednesday, October 9, kept the repo rate unchanged at 6.5% for the tenth consecutive meeting, with a majority vote of 5-1." BS. The Consumer Price Index (CPI) inflation rate in October was 6.21% because Food Price Inflation was at 10.87%. mospi.gov.in. Since the price of food depends on supplies, and a higher cost of borrowing will have no effect on that, ministers are convinced that India's economy will zoom into space if only the RBI slashes its policy rate. "Weak factory production and consumer demand dinged the RBI's 7% headline estimate. Manufacturing crawled in at 2.2%," and "Earnings at top companies disappointed too." "A national election in April and May caused New Delhi to hit the brakes on infrastructure spending, a heavy lifter of growth in recent years. Some of the country's 28 states have been cutting back capital expenditure to offer election-winning cash handouts." Reuters. "What is important to focus on is the significant slowdown in urban consumption," while "there has been almost no growth in organized sector jobs." India had 44.79 million workers in the organized sector in FY13, which rose to 45.72 million in FY23, "a compounded growth rate of an abysmal 0.2%." While salaries of the few at the top have soared, wage growth of workers has been tepid, wrote Sonal Sachdev. "The HSBC final India manufacturing Purchasing Managers' Index, compiled by S&P Global, fell to 56.5 last month from 57.5 in October." ET. China's economy grew at over 10% for several years. "Why does India seem incapable of even a sustained 8%?" Because, "To win elections, governments pamper powerful lobbies...and shower freebies on farmers, large industries, SMEs, various castes, religious groups, women, children and pensioners." "But this eats into funds that could accelerate investment and, hence, GDP growth," wrote Swaminathan SA Aiyar. "A detailed count of welfare/redistribution expenditure of the Union government informs that the government budgeted to spend Rs 10.77 trillion, in 2024-25," which "works out to approximately Rs 7,700 per person for India's 1.4 billion population." "Together, the Union and state governments will be spending close to Rs 26,000 per person on welfare/redistribution," wrote Subhash Chandra Garg. Such enormous stimulus should have increased consumption but it hasn't. Because inflation is uncontrolled and wages are too low. It's the government's responsibility, but they can't provide the solution because they have created the problem. So blame the RBI. Pathetic.