Headlights on the rupee.

"The covid shock revealed the anachronism of stiff fiscal compression targets set by India's Fiscal Responsibility and Budget Management Act of 2003," wrote the Mint. The government intends to borrow Rs 12 trillion this year instead of Rs 7.8 trillion predicted in the Budget. "Remember, India is endowed with neither the privilege of cheap loans for the asking, nor sufficient slack in productive capacity to keep prices stable." "It is true that economic contraction, as seen in early estimates for the first half of 2020-21, necessitated cheap credit as RBI's top priority in its laudable effort to keep commerce going and contain the pain," wrote the Mint. "It is also true that any over-indebted government could by tempted to inflate some of its debt away by letting prices rise. This should be resisted." After months at over 7%, retail inflation dropped to 6.93% in November due to a fall in vegetable prices. India's consumer basket is heavily weighted in favor of food and beverages, because higher food prices affect the poor disproportionately, with transport, healthcare and education having much lower weights. "Between March and December, Brent crude prices have fallen more than 3%, but petrol and diesel prices have climbed 17% and 15% respectively," wrote the Economic Times. Transport may not contribute much to CPI level directly but "since fuels are not under GST, tax increases cascade into higher prices of everything". Health insurance companies have raised their premiums by up to 200%, especially for senior citizens, forcing some to let their policies lapse, wrote Deepti Bhaskaran. Hundreds of private schools may shut down because the government is not allowing them to charge full fees for the year as teaching switched to online because of the coronavirus. In 2016, the government set a retail inflation target of 4% (+/- 2%) for the Monetary Policy Committee (MPC) at the Reserve Bank (RBI). Some economists argue that "by focusing narrowly on curbing inflation, the MPC lost sight of growth, contributing to India's economic slowdown", wrote Bhattacharya, Kwatra and Devulapalli. However, except in 2017 when the economy was trying to recover from the sudden hit of demonetization, the MPC has always managed to keep average inflation rate above its target of 4%. Central banks cannot control inflation or economic growth, they can only control credit growth and thereby influence money supply, wrote Prof VA Nageswaran. The biggest borrower by far being the government, low borrowing rates may encourage injudicious spending, leading to higher debt and rising interest payments. Then there is the rupee. "In the 12 months through November, the PPI (US Producer Price Index)  advanced 0.8% after increasing 0.5% in October," reported Reuters. This means the buying power of the rupee is decreasing at over 7% compared to 0.8% for the dollar. The rupee is riding high because foreign investors have bought Indian shares worth Rs 629.51 billion in November. The RBI has been buying dollars to stop the rupee strengthening too much and to increase liquidity into the system. One dollar bought Rs 3.30 at Independence in 1947, which has dropped to 73.66 today. At some point the rupee will have to adjust against the dollar and then prices of imports will shoot up, taking inflation to levels last seen in 2010-2011. No wonder, talks of higher fiscal spending is complete hot air. Frozen in fear. Like deer in headlights.  

This is an accumulation of pressures.

"Punjab farmers have huge political clout and extract massive subsidies invisible to the public," wrote SA Aiyar. Farmers have been protesting on the borders of Delhi for 17 days demanding complete repeal of new farm laws which allow farmers to sell their produce directly to private buyers, instead of being forced to sell through government controlled wholesale markets known as Agriculture Produce Market Committee (APMC). These markets are controlled by middle-men who form cartels to fix low prices for farmers while selling at high prices to consumers. The new laws seek to get rid of APMCs. The state of Bihar got rid of APMCs in 2005, and "For 14 years now, experts said, farmers have not had a favorable market for their produce." "Before the scrapping of the APMC Act, farmers would sell their produce to the market committees where minimum price was guaranteed. But after the repeal of this system, they indulged in distress sale lest their produce would go to waste because they had no storage facility," said economist Abdul Qadir. "But these laws are highly sensible," wrote Aiyar. "Modi must stick to all three laws." 'Sensible laws' would not "expressly exclude the jurisdiction of the civil court, leaving the farmers remediless and with no independent medium of dispute redressal mechanism".  "Autocracies like China would smash such agitations. But democracies do not shoot agitators," regrets Aiyar. Aiyar has forgotten the fierce beating of students and teachers of Jawaharlal Nehru University (JNU) in January this year by Delhi Police, as well as the shooting of members of certain community during riots over citizenship bills in Delhi in February, and the death by police shooting of five farmers protesting for better prices for their produce in Mandsaur in Madhya Pradesh in 2017. India is supposed to be a federal republic, but "The real power is with the center, which has all-important 'agencies' and holds the purse-strings in fiscally-challenging times," wrote Harish Damodaran. In May, Prime Minister Narendra Modi announced a stimulus package for the economy, worth Rs 20 trillion. In a recent reply to a query under the Right to Information (RTI) Act the government revealed that Rs 3 trillion was sanctioned for loans, of which just Rs 1.20 trillion has been disbursed. "Many of India's current draconian laws have their ancestry in the British era where they were very frankly instruments of repression," wrote Manoj Joshi. Autocratic governments in China, South Korea and Singapore enriched their people by growing their economies, wrote Diva Jain, whereas the rate of growth in India's economy was falling sharply even before the coronaviurus epidemic, explained Roshan Kishore. No wonder 74% of Indians are suffering from stress and 88% from anxiety. Pressures have been building since 2014. Protests are better than an explosion. Over to Modi.  

Atmanirbhar Britain.

In December 2019, Boris Johnson led the Conservative Party to an absolute majority in elections to the House of Commons in Britain, promising to "get Brexit done" and take the UK out of the EU. "Brexit's true believers celebrated: Their messiah would now be able to finish the job he had started in 2016," wrote Luke McGee. "A scant 12 months later, much of that goodwill has vanished -- despite his party continuing to perform well in opinion polls compared to the opposition Labour Party." In January this year, the British Parliament passed a bill finalising Britain's exit from the EU and set a transition period till 31 December to come to an agreement on future trade relations. "Unless the UK asks for an extensions beyond 2020, trade relations from the start of 2021 will either be governed by whatever agreement can be reached, or World Trade Organization rules." Which will mean tariffs on imports, increasing consumer prices, from, and on exports, losing to cheaper competition, to, the EU. Talks on a trade deal have been fruitless and today has been set as the deadline for coming to an agreement, or else a 'No Deal' Brexit will go ahead from 1 January 2021. After 11 months of chest thumping on how the EU has much more to lose from Britain's exit, "Business leaders were sweating last night as the prospects of a No Deal Brexit increased dramatically," reported the Daily Mail. "It came as bank Morgan Stanley dealt another blow to Britain's post-Brexit prospects, becoming the latest Wall Street lender to shift chunks of its assets out of London." Perhaps, Johnson's trouble in coming to any agreement with the EU is a hangover from the Conservative Party icon Margaret Thatcher who forced a reduction in Britain's contribution to the EU's budget. Her famous "No, no, no" speech against greater integration with Europe in the House of Commons in 1990 was apparently based on an article written by Boris Johnson in the Daily Telegraph. Johnson has repeatedly claimed that Brexit, even a No Deal one, will be good for Britain as it will be able to negotiate separate deals with all the other countries of the world. But, the EU takes 43% of all UK exports and sends in 52% of all UK imports. In panic Johnson rushed over for a dinner with European Commission President Ursula von der Leyen (pronounced Lion) but the "lady is not for turning". There will be last ditch talks today but both sides are pessimistic about a favorable outcome. In a sign of British arrogance and colonial mentality the Mail on Sunday savages Angela Merkel of Germany and Emanuel Macron of France for refusing to surrender. It's not just about fish and cheese. Scotland and Northern Ireland voted overwhelmingly to remain within the EU and First Minister of Scotland Nicola Sturgeon has warned that she may ask for a referendum to leave the UK. Without Scotland and Northern Ireland, Britain cannot claim its seat in the UN Security Council. The 'Little Englander' may pine for 'Atmanirbhar' or 'self reliance' but may become really little. A lesson for us, perhaps.

Surely too little, not too much?

Tough reforms are difficult in India because "we are too much of a democracy", Niti Aayog CEO Amitabh Kant seemed to complain. Naturally, his remark was greeted enthusiastically on social media. To stop the controversy this remark generated, Union Minister Ravi Shankar Prasad said, "We are proud of our democracy." "My statement, with relevant portions, is that India is too much of a democracy to mirror a China model," explained Mr Kant.  Argentina, Brazil, South Korea, Singapore and Malaysia all grew fast economically under authoritarian governments, wrote Diva Jain. Robert J Barro showed that "after controlling for other drivers of growth, the overall effect of democracy on growth is weakly negative on average". "In another observation relevant to India's case, he states that the growth-retarding features of a democracy are redistributive schemes and the enhanced voice of special interest groups." India has always had a plethora of social schemes for redistribution to the poor, and this government has been prolific in adding more schemes. Prime Minister Modi announced waiver of bank loans to farmers to win UP assembly election. Last year, he promised Rs 6,000 to all farmers at a cost of over Rs 870 billion and pension scheme for farmers at a cost of Rs 100 billion. Now farmers are protesting at the borders of Delhi, demanding repeal of new farm laws, and the minimum support price (MSP) to be written into law. In fact, they want a "guaranteed remunerative MSP (GRMSP)" to be made mandatory for the private sector with punishment for anyone offering to purchase farm produce at less than that. "Also, many growth drivers in a democracy, such as accountability, rule of law, enforceability of contracts and enriched information environment, do not require drastic legislative action and can be improved through better administration." Indian politicians see accountability and civil servants see information to citizens as loss of power. Every year, at this time Delhi suffers from hazardous levels of pollution. Stubble burning by farmers in surrounding states, encouraged by subsidies, contribute a large chunk to pollution, wrote Seddon and Prof Gulati. When assets of the insolvent non-banking finance company DHFL was put up for sale, US based Oaktree Capital Management looked like a potential winner but the Adani group submitted a bid slightly higher than that of Oaktree after the deadline, leading to suspicions about confidentiality. No one held accountable for cheating. A US firm admitted to paying $1.1 million in bribes to the National Highway Authority of India (NHAI) in 2017. No one punished in India. Right to Information Act (RTI) has been hamstrung by the government by not appointing commissioners so that queries are piling up. "The SC (Supreme Court) simply refuses to hear constitutional challenges to far-reaching State action, sometimes for years," wrote Gautam Bhatia. "Judicial evasion is accompanied by judicial deference." The SC accepts false assurances from the government. Mr Kant must be living on another planet. Democracy is just a word in India. Opium for the people.

Not just an expensive building, could divide the nation.

Prime Minister Narendra Modi laid the foundation stone of a new parliament building in the center of New Delhi yesterday. The parliament building will be part of a 'Central Vista Project' at a total cost of Rs 200 billion. There will also be a new residence and office for the prime minister and the vice president. Modi "praised India's spirit of democracy" and said that "other countries discuss elections and other administrative issues when speaking about democracy and that a day would soon come when other countries will say 'India is mother of democracy'." A batch of petitions against the new building have been filed before the Supreme Court which allowed the ceremony to go ahead but ruled that "no construction or demolition will be allowed until it disposes pleas opposing the Central Vista Project". "World history is replete with examples of public infrastructure projects playing a key role in reviving economies in distress," wrote Secretary, Ministry of Housing and Urban Affairs Durga Shanker Mishra. "The 'New Deal' in he USA included over 34,000 public works worth $3 billion for recovery from the Great Depression." Indeed. The famous Route 66 in the US, "True to promoters' foresight, traffic on the highway increased, a growing share of it long-distance, and the need for food, fuel, repairs and shelter transformed the economies of towns through which the route passed." A new parliament building will generate some construction jobs initially but will cost massive amounts of taxpayer money for maintenance and members of parliament are exempt from paying income tax. "The first Lok Sabha, constituted in 1952 had 461 seats , but within three years, the number increased to 499. 'Subsequently, the seats went up to 522, then to 530' and 'now, presently up 550 within the same building' according to documents" available in the Lok Sabha secretariat, wrote Saubhadra Chatterji. At present the Lok Sabha has 543 members while the Rajya Sabha has 245. A larger building is needed to seat 888 members in the Lok Sabha and 384 in the Rajya Sabha. That indicates imminent delimitation, which seeks to allocate the number of seats in parliament according to population in states so that each member represents roughly equal number of people. "Although unintended, this meant that states that took little interest in population control could end up with more seats in Parliament, while southern states that promoted family planning could end up with fewer seats." As it is the Hindi states have a stranglehold on the parliament with the Bharatiya Janata Party (BJP) of prime minister Modi winning 156 out of 303 seats in Hindi states, in the Lok Sabha in 2019. The present distribution of seats in the Lok Sabha has not changed in decades but populations of Uttar Pradesh and Bihar have increased more than 19% while those of Madhya Pradesh and Rajasthan have increased by about 18%, between 2011 and 2019. Not just enormous expense. Could lead to further division of India. Is that what Modi wants?

Should we expect optimism or pessimism?

The micro, small and medium enterprises (MSMEs) sector has "over 60 million functional units, employs around 110 million people and contributes a little less than 30% to the country's economic output and more than 40% to its exports". wrote Lalit Bhasin. During the coronavirus lockdown, struggling MSMEs "found e-commerce to be an effective, swift and low-cost option to reach customers". This proved to be a trap. "The mandatory 'country of origin' tag is their latest regulatory entanglement, after recently-implemented tax deduced at source (TDS)  and tax collected at source (TCS) requirements multiplied the complexity of their compliance management." The informal economy "may not come under direct taxes, as income here may be mostly under the taxation threshold", wrote Satya Mohanty. "Studies in Latin America show that a thriving under-ground economy could aid growth" because "60% of earnings from unaccounted-for-economy are used almost immediately in the official economy". However, this is totally different from black money. "Electoral bonds with no trails are effectively an invitation to a government-crony nexus and a recipe for further generation of black money." The government needs high tax collection "to boost public spending in a manner that puts money in people's hands, especially those who are more likely to spend rather than save it", wrote an editorial in the Mint. "In basic-input sectors like cement, steel and aluminium, clear signs have emerged of a revival in capital spending," wrote the Mint. Why, when "Consumer confidence, as measured by a RBI (Reserve Bank) survey, remains dismal," is unclear. "Estimates peg the total job loss for salaried individuals at 21 million between April and August of 2020," wrote Shayan Ghosh. "Initial data released by the central bank shows that more than half off all retail borrowers who had availed a loan had opted for a moratorium by the end of April." As the moratorium period ends, banks are using loan recovery agents to coerce customers to repay loans. "I foresee even suicides from this retail distress," said Jehangir Gai, a consumer activist. The RBI is helping the government by tolerating a high inflation because high prices means higher GST collection and higher wages result in higher income tax collection. High inflation results in a fall in the value of the currency which reduces value of government debt. "A repo rate of 4% when inflation is expected to stay above 6% means that negative real interest rates by design," wrote The Economic  Times. "Revising up inflation bands for the central bank will hurt the poor," former Deputy Governor of the RBI Viral Acharya said. "For consumers, the high excise duty and VAT, which make up 63% of petrol and 60% of diesel prices, makes the pinch harder due to their incremental increase after every hike in the base price." As transport costs rise so will prices of goods and services. High taxes, high prices, high individual and government debt. A tsunami maybe on the way.  

Will he go with Trump's policy or Obama's?

Iranian nuclear scientist "Mohsen Fakhrizadeh was shot dead in a convoy outside Tehran on 27 November."  Deputy commander of the Revolutionary Guards Brig-Gen Ali Fadavi said that a machine gun mounted on a Nissan pick-up "was equipped with an intelligent satellite system" and "was using artificial intelligence" so that it was able to focus "only on martyr Fakhrizadeh's face in a way that his wife, despite being only 25cm (10 inches) away was, not shot". Before that, Al Qaeda's second-in-command "Abdullah Ahmed Abdullah, who went by the nom de guerre Abu Muhammad al-Masri, was gunned down by two men on a motorcycle in the streets of Tehran on Aug 7". Iran has denied that any Al Qaeda members are living in the country. In June a previously unknown group calling itself Homeland Cheetahs, which claimed to be "composed of dissidents within Iran's military and security forces", said "it had attacked the major Iranian nuclear site at Natanz". In the months before this attack, "Numerous fires have broken out in nuclear facilities, oil refineries, power plants, major factories and businesses across the country." In July, at least seven boats caught fire at a shipyard in the port of Bushehr. "Sixty million Iranians, 75% of the population, are living, are living below the international poverty line," wrote Struan Stevenson. The currency, the rial has lost 49% of its value this year due to the sanctions imposed by the US. "President-elect Joe Biden made it clear during his campaign that his administration would favor a return to the 2015 Iranian nuclear deal, reversing a cornerstone of President Donald Trump's foreign policy in the Middle-East." "US President-elect Joe Biden will insist Iran agrees to new demands if it wants the US to return to a nuclear deal and lift sanctions," the New York Times reported. "Iran would also have to address its 'malign' regional activities through proxies in Lebanon, Iraq, Syria and Yemen in the talks that would have to include its Arab neighbors like Saudi Arabia." That would surely be too much. Persian versus Arabs, Shia versus Sunni, total annihilation of Israel versus secret talks with Israeli Prime Minister Benjamin Netanyahu. Naturally, Iran said it "will not accept preconditions from a new Biden administration over its nuclear program and the US must return to a 2015 deal before talks can take place". It will resume enriching uranium and stop all inspections by the IAEA after two months if the US fails to do so. Meanwhile, Iran is having to credit Israel with a satellite-controlled, AI-operated machine gun pinpointing Fakhrizadeh using facial recognition technology, to hide its own weaknesses. Whether people agree or not, President Trump knew what he wanted. Does Biden?

How to save our savings?

"This year's budget sneaked in some stuff that hits senior citizens right in the gut," wrote Sandipan Deb. Exemption limits for income tax has been Rs 250,000 for those under 60 years of age, Rs 300,000 for those between 60-80 years, and Rs 500,000 for those above 80 years of age. "But this budget set all limits at Rs 250,000. No concessions for elders." However, the official site of the Income Tax Department shows that exemption limits remain unchanged in Assessment Year 2021-22, which corresponds to this financial year. Previously, companies had to deduct a 15% distribution tax on dividends and individuals were required to pay another 10% tax on dividends in excess of Rs 1 million. Now dividends will be taxed in the hands of the recipient. Pensioners have been savaged by the Reserve Bank (RBI) lowering interest rates far below the rate of inflation so that interest on savings is less than erosion in the value of money. "As per a National Family Health Survey (NFHS) of 600,000 households in 2016, 30% of households owned a refrigerator", which means that about 33%, or 450 million, of Indians are middle class and these people "have been neglected or simply ignored by successive Indian administrations", wrote Deb earlier. According to the State of Tax Justice, India is losing $10.3 billion, or Rs 750 billion, every year to tax evasion. "Of this, over USD 10 billion is lost to tax abuse by multinational corporations (MNCs) and USD 200 million (about Rs 15 billion) to tax evasion committed by private individuals." Less than peanuts, considering our GDP of around $2.9 trillion, though it could be less next year if the economy contracts due to the lockdown to control spread of coronavirus. "The belief that India has very few taxpayers and millions of people routinely hide their income has been the underpinning for the country's onerous income tax administration and a consequent mistrust of citizens," wrote Praveen Chakravarty. "India's per capita income is around Rs 1.4 lakhs (Rs 140,000)." "Even if millions of people hide their incomes from tax authorities, it will be accounted for in India's GDP and per capita income data since they will use this hidden income to eventually spend on goods, real estate, gold and so on," and if they hold vast amounts of wealth in cash it will show up in "currency in circulation" data provided by the RBI. To reach income tax threshold you have to earn Rs 21,000 per month, but "82 percent of male and 92 percent of female workers earn less than Rs 10,000 per month, finds 'State of Working India' report". "India must break out of this vicious cycle in which taxes are high, consumer demand is low, investment and job creation are constrained, and wage incomes are insufficient to boost purchasing power at the bottom of the pyramid," wrote Andy Mukherjee. High taxes on low earnings. Will never lead to wealth.    

Why do foreigners expect to make profits at this time?

"In line with economists' fascination with alphabets, we see a 'double barrel V'-shaped (one V over the other) recovery for India," wrote Sonal Varma and Aurodeep Nandi. The festival demand boosted manufacturing, the government is procuring enough vaccines, interest rate is negative, which should encourage borrowing, and the global economy will recover in 2021. However, "India's pre-pandemic crisis involving a triad of weak balance sheets -- of corporates, banks and shadow banks -- are now skeletons temporarily hidden inside the cupboards of moratoria, credit guarantee schemes and procedural delays to the recognition of bad loans." "Job cuts and salary adjustments have not been as widespread as originally apprehended despite the severe impact on the revenue of companies in the aftermath of Covid-19 pandemic, a study has revealed." The Indian economy will enter a 'Goldilocks' phase in 2021, said Morgan Stanley, which means moderate growth without inflation. "The Reserve Bank of India (RBI) on Friday held interest rates steady, forecast a lower GDP contraction for the second half of the year, and sharply raised inflation projections, asserting that growth will return to the positive territory in the third and fourth quarters of the 2020-21 fiscal year," reported Times of India. "Normally, with this kind of elevated inflation scenario, the regulator would have treaded a more careful path," but, "given the extraordinary situation, the RBI decided to give growth a priority over immediate price stability," approved Sunil Sanghai. "This is clearly visible in the equity markets' reaction with the BSE Sensex Index touching the 45,000 mark which has not been witnessed in this last year." "A repo rate of 4% when inflation is expected to stay above 6% means that negative real interest rates by design," wrote an editorial in the Economic Times. We can only hope that the RBI is not allowing inflation to go unchecked only to help the government reduce its debt load as the government has announced it will need to borrow Rs 12 trillion this year to meet its expenses. However, RBI's tricks may not work because tax collections may not rise in line with inflation. "In India, the net profits of listed companies grew 25 percent (in real terms) last quarter. This despite revenues shrinking because firms aggressively cut costs, including employee compensation," wrote Sajjid Z Chinoy. No salary, no income tax. And if demand does recover, inflation is bound to shoot up because "the pump price of petrol is set to breach all-time high levels next week". Foreign portfolio investors (FPI) "pumped in a net sum of Rs 16,520 crore (Rs 165.20 billion) into equities and Rs 1,298 crore (Rs 12.98 billion) in the debt segment during December 1-4". A total of Rs 629.51 billion in November. Clearly, they expect huge profits. Who will pay for those profits? Dread finding out.

Brown colonialists are lethal.

"Many of India's current draconian laws have their ancestry in the British era where they were very frankly instruments of torture," wrote Manoj Joshi. "If you, through 'words, either spoken or written, or by signs, or by visible representation' bring 'hatred or contempt' or excite 'disaffection towards the government' your goose is cooked, according to the sedition clause, Section 124A of the IPC." "This year, a primary schoolteacher and a mother were arrested for sedition, and children were interrogated" as "a chilling warning to all protesters and dissenters, that the price of liberty is high, very high". Belatedly, "In an order of far reaching significance the Supreme Court on Wednesday put the police, CBI, National Investigation Agency, Enforcement Directorate, Narcotics Control Bureau, Department of Revenue Intelligence and Serious Fraud Investigation Office under CCTV surveillance to prevent custodial torture." Many police forces in the US require their officers to wear video cameras on their bodies to try an prevent unnecessary use of force. "But in a heated situation where force becomes necessary, it is instinct rather than careful consideration that takes over" because, "Primarily it is police training -- honed over decades -- that prevents a police officer from fighting or running away," wrote Honig and Johnson. "Dozens of protesters have clashed with police in the French capital Paris in fresh demonstrations against a controversial draft security law," reported BBC. "Article 24 of the proposed bill makes it a criminal offence to publish images of on-duty police officers with the intent to harm their 'physical or psychological integrity'." This is clearly an effort to hide police brutality. Unfortunately for the government a video of four police officers "beating up and racially abusing a black music producer in Paris went viral", forcing the government into a humiliating u-turn. Indian police are famous all over the world for executing suspected criminals without having to account for their actions. While peaceful protests are allowed everywhere in the world, Indian politicians respond by asking police to shoot protesters to death. Thus, Tamil Nadu Chief Minister Edappadi Palaniswami called it a "natural reaction" when police shot 13 people to death for protesting against a copper plant for contaminating their drinking water. The plant was permanently shut down after the killing. No one has been charged with unnecessarily killing law abiding citizens. A senior bureaucrat issued orders to "shoot-on-sight" if anyone protested against the conviction of Gurmeet Ram Rahim Singh on charges of rape. "At least 38 people were killed and more than 200 were injured," reported Reuters. A day later train and bus services were stopped to prevent people from gathering. When our government finds us disposable why do we become indignant if Richard Nixon described us "scavenging people". Other people have value. We have none.

," 

Animals and humans, all are fair game.

"India heads the list of countries with the highest annual average exposures to PM 2.5 - fine particulate matter hazardous to health - and the third highest average ozone exposures in the world, with a 17% increase in the last decade." 1.67 million, including 116,000 infants die of pollution every year. The pollution level in the national capital Delhi is deemed to be hazardous this morning.  "Under the National Clean Air Program (NCAP), the central government had approved the clean air plans in more than 100 cities in 2019. The program aims to cut down pollution levels in these cities by 20-30% by 2024 (with 2017 as the base year). But there are serious questions about NCAP's effectiveness," wrote Tauseef Shahidi. "New Delhi has the worst air of any capital on the planet, according to IQAirVisual, a Swiss-based group that gathers air quality data globally," wrote Bhardwaj and Arora. "Delhi has blamed farmers burning crop stubble in the neighboring states for its sickly air", but "more than half the pollutants in Delhi's air are the result of vehicular emissions, toxic waste and smoke from thousands of small unregulated industrial units and dust from never-ending construction". "About 78% of the cities exceeded PM10 standards compared to 36% for PM2.5, 9% for NO2 and none for SO2," wrote Chandra Bhushan. "The three easiest things to do" is "stopping farm fires; preventing the burning of garbage; and prohibiting the use of diesel generators, not just in Delhi, but in entire NCR (National Capital Region)". wrote Chanakya. This is not being done because different parties govern Delhi, Haryana and Punjab. State-run electricity generating company NTPC said that thermal power plants are not responsible for pollution in Delhi/NCR. "Stubble burning in northern India has long been a major cause of air pollution, but efforts to stop it fail every year,' wrote Pathi and Chhabra. Farmers are a crucial vote bank, and so "court orders like bans and fines remain unenforced". "Stubble burning incidents saw a steep rise of more than 20 percent this year in comparison to the last two years," said KJ Ramesh. "The situation of air pollution in Delhi is still serious. Stubble burning has stopped but Delhi's air quality index still remains in 'very poor' category," Union Environment Minister Prakash Javadekar said. Even as "their fellow citizens were distracted by pandemic related anxieties", the National Board for Wildlife, at the direction of Mr Javadekar, "successively rubber stamped approvals for an astonishing 16 proposals impinging on ostensibly sacrosanct national parks and wildlife sanctuaries", wrote Vivek Menezes. Speaking with forked tongue. Thick skinned.

Balancing one vote bank against the other. Not easy.

"India's economy left cratered by the pandemic is drawing energy from one of its invisible and often neglected engines: farmers," wrote Kotoky and Alfonso. "Business leaders, policy makers and politicians alike are pinning hope on the rural sector as bountiful rains have set the stage for another year of record crops. Higher disposable incomes with farmers are expected to boost demand from automobiles to cement to gold jewellery." If farmers are buying cars and gold why are they protesting on the outskirts of Delhi, with women and children joining the men in sleeping out in the cold weather? After talks, lasting 7 hours between Union Agriculture Minister Narendra Singh Tomar and farmers' unions yesterday, ended without an agreement, the minister hinted that the government might amend the 3 farming laws. Earlier in the year there were protests at Shaheen Bagh in Delhi, led mainly by women, against the Citizenship (Amendment) Act (CAA) which was broken up with the lockdown to control the coronavirus from spreading. "If the laws really are as beneficial for farmers as the Center claims, why were they rushed through parliament in such a sneaky manner?" asked advocate Uday Pratap Singh. "How can we trust the government's very late reassurances about the farm laws when it openly favors big corporates?" "When the method of voice voting was resorted to on September 20," "MPs demanded division. This was voiced at 1.09 pm on Rajya Sabha TV. But it never reached the public ear because footage was doctored to such an extent that it was muted," wrote Tulis and Puri. "This was the most anti-democratic moment in the history of the Indian Parliament." Can't expect trust after such low down tricks. "Shaheen Bagh had this pressure of being a civics and moral science lesson all at once," said Simranjeet Singh. "The right wing will have to work harder at villainising us." Over 50% of India's workforce are engaged in farming but agriculture contributes only 17.5% of GDP which means farmers are not sharing in the growth of the economy. This makes farmers a huge vote bank. Farmers are demanding the minimum support price to be written into law. "The most immediate impact of such a law will be higher inflation. MSPs prima facie lead to higher overall prices," wrote Zia Haq. Retail inflation jumped to 7.61% in October, with food inflation at 11.1% year-on-year. Inflation hurts the poor, so the government banned export of onions in September. The poor are a bigger vote bank than farmers. If the government depresses prices, the promise of riches from private sector is merely jumla. Farmers are right to call the government's bluff. What if it's all jumla.           

Public sector means belonging to people. Not for personal use.

 "Early last month, a directive went out from the central government to the public sector undertakings (PSUs) owned by it to pay higher dividends and not to wait for the end of the financial year to do so," wrote Vaidik Dalal. "Further, it asked them to consider not just the current year profitability, but also dip into their financial reserves for these dividends." Dalal goes on to make an extraordinary statement, writing, "As the majority owner, the Center is within its rights to do all this." This is to say that laws of business do not apply to the government and politicians are at liberty to plunder any company if they want. Last year, the government forced the Reserve Bank to transfer Rs 1.76 trillion from its reserves to the government. By this logic Mr Ramalinga Raju would have been within his rights to divert money from his company Satyam if he had done it openly. Following this scam, the government passed a law to make auditing firms liable if they fail to detect and report diversion of funds. The Corporate Social Responsibility (CSR) Act requires companies "with a net worth of INR 5 billion (US$70 million) or more, or an annual turnover of INR 10 billion (US$140 million) or more, or net profit of INR 50 million (US$699,125) or more," to spend 2% of profits on social schemes. "The Indian Express reported that RTI responses received by it from 38 PSUs showed that they had contributed Rs 2,105 crore (Rs 21.05 billion) -- 60% of their total CSR spend -- to the newly launched PM Cares Fund," wrote Dalal. Questions have been asked about the PM Cares Fund, about "how it is constituted and managed, how much money has been collected, from whom, and how it is being put to use", reported the BBC. Queries based on the Right to Information Act are refused on the pretext that the fund is not a public authority when money has been raised from the public and from PSUs, which are traded in stock markets. We already have a National Disaster Relief Fund (NDRF) and rightly all the money should be transferred to that fund, but the Supreme Court refused to consider it. In 2012, the then government forced the Life Insurance Corporation (LIC) to buy 400 million ONGC shares at a cost of Rs 126.67 billion, to finance its spending. This government has not been shy of forcing the LIC to buy shares of PSUs which it passes off as disinvestment. As a result the LIC "has seen the value of its holding erode by more than Rs 20,000 crore (Rs 200 billion) in just five major stocks in roughly two years." In September, the Finance Minister announced 'Loan Melas' wherein public sector banks will dish out loans "in 400 districts of the country to boost demand ahead of the festive season". Small wonder, non-performing assets (NPAs) in banks are likely to reach 11-11.5% of total lending this financial year, "the highest among comparable countries". The governor of the RBI expects NPAs to rise to 14.7%. Public sector means belonging to the public, or the people of India. How to make politicians understand that public money is not their's? Without being charged with sedition.

The vanishing middle class.

"As the covid pandemic continues, the Narendra Modi government has spent millions of rupees to aid the poor," wrote Sandipan Deb. Excellent, "But the middle-class devastation that has been going on for the past few months has received almost no attention -- either from the government, or the media." Hundreds of thousands have been sacked and those remaining have seen their salaries slashed by up to 40%. "The economy is shrinking this year and companies have seen their sales decline year-on-year for five straight quarters. But listed companies have never made profits like they made in the quarter ended September 2020," wrote Mahesh Vyas. "Understandably, shareholders are being rewarded interim dividends and buybacks," but rise in wages has been little. Naturally stock markets recorded their highest levels a few days back. Foreign portfolio investors (FPIs) had poured Rs 58,694 crore (Rs 586.94 billion) into Indian stocks till 26 November. "Over the last few years, bank credit to industry has been shrinking, while that to consumers has been growing rapidly," wrote Vivek Murthy, With jobs being lost due to shrinking of the economy, "consumers without jobs and income will be unable to pay the huge debts they are now incurring". "Since April, most economists have maintained that high inflation will be transitory. Yet it has assumed a permanence throughout the year, driven by high food prices," wrote Nikita Kwatra. "The world economy will bounce back in 2021 with global gross domestic product jumping up by 4.2% after falling in similar proportion this year, the Organization for Economic Cooperation and Development says in its latest report. As the world recovers from the virus induced recession, commodity prices will rise affecting India, because we import 80% of our oil needs. India imported "270 million metric ton of crude oil valuing $120 billion in 2019-20," wrote Abhimanyu Joon. "The amount is nearly 500% more than the average value of exports made by India in the corresponding year." The price of petrol is now at record levels of which taxes comprise over 60%. The Reserve Bank (RBI) has created the real interest rate which is effectively (-)4% in India, said Prof Raghuram Rajan, which means middle class savings are being sacrificed to help the government and its cronies. Richard Cookson is worried about inflation picking up sharply as "the developed world recovers over the next few months". However, "As has been the case for many years, global inflation has 'Made in Asia' stamped all over it." A combination of loss of income, high prices, extortionate taxes, and RBI repression may eliminate the middle class and make us all poor. Real equality.

Connect with billionaires, disconnect with people.

"In a significant shift of stance, large corporates and conglomerates could own banks if the suggestions of an internal working group (IWG) constituted by the Reserve Bank of India (RBI) are accepted." Also, "large, well-run non-banking finance companies (NBFCs), with an asset size of Rs 50,000 crore (Rs 500 billion) and above could become banks post 10 years of operations once they pass he due exercise". "Around half of the finance companies with assets of over Rs 50,000 crore that meet the RBI's size criteria to get a bank licence are part of corporate groups, while two are already part of banking groups." Banks are allowed to take deposits from ordinary people who will get hurt if a bank fails. If large companies own banks it may lead to 'connected lending'. "Simply put, connected lending refers to a situation where the promoter of a bank is also a borrower and, as such, it is possible for a promoter to channel the depositors' money into their own ventures," wrote Udit Misra. "Past examples of such mingling -- such as Japan's Keiretsu and Korea's Chaebol -- came unstuck during the 1998 crisis with disastrous consequences for the broader economy." It will be bad because it will lead to connected lending and give too much power to a few business houses, wrote Profs Raghuram Rajan and Viral Acharya. "Interestingly, the IWG reports in its appendix that all the experts it consulted except one 'were of the opinion that large corporate/industrial houses should not be allowed to promote a bank'. Yet it recommends change!" It's a very bad idea, wrote SA Aiyar. "Just imagine what would have happened if (Vijay) Mallya, (Nirav) Modi and (Subrata) Roy had been allowed to own banks. The would have got their self-owned banks to lend not thousands but lakhs of crores (trillions) to their own dud and crooked businesses, concentrating ever more political and financial power in a few dubious hands." This move is essential because, "Currently, India's banking system as a percentage of gross domestic product (GDP) is just 70%. The only other large nation with rapid growth is China, which has a figure of 170%," wrote banker KV Kamath. China's GDP is $14 trillion while that of India is just $2.9 trillion, and China's economy grew by 4.9% in the September quarter after shrinking by 6.8% in the first three months of the year, while our government is congratulating itself because India's GDP shrank by less-than-expected 7.5% in the September quarter after contracting by a shocking 23.9% in the first. While proposing to allow billionaires to play with our money the government is trying to withdraw whatever protection depositors have through a Financial Regulation and Deposit Insurance (FRDI) Bill. "Why has the consumption of gold gone through the roof in India?" asked Uma Shashikant. Because the rich are cronies and the poor are vote bank. The taxpaying middle class is being looted, wrote Sandipan Deb. Bank licences will make that legal. 

It's a huge challenge.

 With schools closed due to the epidemic, the Annual Status of Education Report (Rural), or ASER 2000 is conducting a country-wide telephone survey on home schooling in multiple waves, wrote Sudipto Mundle. The results are highly encouraging. "The proportion of children not enrolled in a school has increased only marginally, from 4% to 5.5% between 2018 and 2020." And, "62% of the children now have smartphones at home, a sharp increase from 37% just two years ago in 2018, another 10% have access to smartphones outside homes, eg, from neighbors". India needs to focus on undoing the widening gap of inequality in education caused by the pandemic as soon as possible, said Prof Abhijit Banerjee. Only 25% of Indian households had broadband internet that is suitable for online classes. A phone survey by ASER 2020 of 60,000 students in rural India showed, "Only about one-third of the surveyed children had access to online learning; only 11 percent had access to live online classes" Over 80% of children have the required textbooks, and the proportion is higher in government schools because of free distribution. The disadvantage can be inherited as "children with parents educated till Class X had a markedly better access to learning in these months than the children of parents with fewer years spent in school". "The coronavirus pandemic is forcing India's children out of school and into farms and factories to work, worsening a child-labor problem that was already one of most dire in the world," wrote Shwetha Sunil. "A 2018 study by DHL International GmBH estimated that more than 56 million children were out of school in India -- more than double the combined number across Bangladesh, Indonesia, Malaysia, Philippines, Thailand and Vietnam." The government has unveiled a new National Education Policy (NEP) which makes sweeping changes to school and college teaching. However, politics is the biggest obstacle to change in India. "Outside the educational hubs of Tier 1 and Tier 2 cities, it is not professional educationists, but politicians and their supporters who own and run a large segment of private schools and colleges. Thus, NEP is likely to hurt political class the most," wrote Rahul Verma. Poor students are unsuspecting victims being "defrauded by a nexus of middlemen, bank staff, school authorities, and state government employees to siphon off money from the Pre-Matric scholarship initiative under the Union Ministry of Minority Affairs." When Samajwadi Party distributed free laptops in 2012 many students sold them off because they could not afford broadband charges or because of a lack of reliable electricity supplies. Must educate every child if India is to become a rich country. But how?       

Will there be a warm welcome in the January cold?

 "Iran's top nuclear scientist was killed Friday in an alleged assassination that the country's foreign minister linked to Israel. Mohsen Fakhrizadeh, considered one of the masterminds of Iran's controversial nuclear program, died after his car was apparently ambushed in a district east of Tehran," reported CNN. "A landmark report by the UN nuclear watchdog in 2011 identified Fakhrizadeh as a central figure in suspected Iranian work to develop technology and skills needed for atomic bombs, and suggested he may still have a role in such activity." Iran immediately blamed Israel for the assassination and the US deployed aircraft carrier USS Nimitz in the Persian Gulf to protect its troops. The US had imposed sanctions on Fakhrizadeh in 2008. Israel assassinated 4 Iranian nuclear scientists between 2010 and 2012. In 2018, Mossad agents broke into a warehouse in an industrial district of Tehran and "fled with half a ton of secret materials, including 50,000 pages 163 compact discs containing files, videos and plans" regarding Iran's nuclear activity. Not all Mossad operations go so smoothly. In 2010, Dubai police issued international arrest warrants for 26 Mossad agents involved in the assassination of Hamas operative Mahmoud al-Mahbhouh who, Israel believed, was instrumental in the kidnap of two Israeli soldiers. In the last few months Israel signed peace deals with the UAE and Bahrain, and then with Sudan at the end of October, in Washington. These are known as 'Abraham Accords', but Saudi Arabia is "the big white whale in this story", said Jerusalem Deputy Mayor Fleur Hassan-Nahoum. Just a few days back, "An Israeli government official said Prime Minister Benjamin Netanyahu held his first ever known meeting with Saudi Crown Prince Mohammed bin Salman on Sunday, but the claim was swiftly denied by Riyadh's top diplomat." The talks were apparenly attended by US Secretary of State Mike Pompeo. This trip by Netanyahu and the head of Mossad to Saudi Arabia was not about normalizing relations but about concerns both nations have about Donald Trump's loss to Joe Biden in the US presidential election, said Joel Rosenberg. There was mutual hatred between Netanyahu and Barack Obama, and Biden was Obama's Vice President. There were rumors in 2014 that Obama threatened to shoot Israeli jets down if they tried to bomb Iranian nuclear research sites. The Obama administration denied the rumors. Israel has till 20 January if it is to attack Iran. However, bombing nuclear sites may not be enough because Iran's retaliation will be ferocious, it has a wide range of ballistic missiles  and Saudi Arabia is just across the Gulf. Biden may have to start his term with an all out war. A warm welcome. Very warm.

Economy grows by the very act of living.

"India's economy officially entered into recession as the second quarter GDP contracted at a slower pace of 7.5 percent compared to a massive 23.9 percent in the first quarter of the current fiscal." An economy is said to be in technical recession when it contracts in two successive quarters. Still it is very good news because performance in the second quarter was nearly 70% better than in the first. "The surprise was thrown by good performance by the manufacturing sector that showed marginal growth in the second quarter," having shrunk by 39.3% in the first quarter." The slightest positive after such an enormous negative is something to cheer about. "However, the private consumption shrank by 11.5% showing that bounce back in private demand is still some time away." Contracting for the eighth consecutive month, the output of eight core infrastructure sectors dropped by 2.5 percent in October, mainly due to decline in production of crude oil, natural gas, refinery products and steel." Coal, fertilizer, cement and electricity recorded positive growth. A blowout of natural gas well at Baghjan oilfield in Tinsukia district in Assam on 27 May 2020 killed 2 people and has caused widespread damage to the Dibru-Saikhowa National Park as well as to local habitations. An investigation showed that Oil India Ltd, a public sector company, was operating the well illegally without obtaining environmental clearance. The well was finally capped after 80 days, having caused extensive damage to surrounding areas. Economists advised caution in reading GDP figures. Kunal Kundu said that a "rather low GDP deflator has resulted in higher-than-expected real GDP growth". "After an uptick in early November, high frequency indicators are beginning to show fatigue," said Shashank Mendiratta. "We expect growth to remain negative in the third quarter and post a small positive growth in Q4," said Anagha Deodhar, and "We retain our FY21 GDP growth forecast to -7%," said Garima Kapoor. "Foreign direct investment (FDI) grew by 15 percent to USD 30 billion during the first half of the current fiscal, according to official data." Of this, billionaire Mukesh Ambani got the largest chunk in his businesses, Reliance Jio and Reliance Retail. "With India's GDP clocking a lower contraction of 7.5 percent in the September quarter, industry and experts expressed confidence of further recovery in he coming months and said government actions are bearing fruits." After the strictest lockdown for over a month, when life came to almost a standstill, it is only natural for economic activity to grow as people resume their struggle to survive. The government can destroy the economy. People make it grow. It is called life.   

What if everyone starts to buy stuff?

 "Reserve Bank of India governor Shaktikanta Das has raised concerns over demand sustainability with the close of the festive season and rise in Covid-19 infections in India which pose downside risk to growth." "After witnessing a sharp contraction in GDP by 23.9% in the first quarter of the current fiscal year", economic growth rose sharply in September and October due to festival demand but "they have moderated sharply since then". "The Reserve Bank of India (RBI) has cut interest rates by 'a great deal' and more policy space can be created when inflation eases, its executive director and interest rate-panel member Mridul Saggar said." "The high share of food expenditure in our CPI basket results in a significant bearing of it on the blanket CPI figure whenever there is a change in food prices," wrote Karan Bhasin. There is no guarantee of a quick easing of supply side problems as several states are considering repeat lockdowns to control rising cases of virus infections, wrote Arunabh Saikia. According to Prof Raghuram Rajan, "a reverse repo rate of 3.35% along with CPI inflation of over 7% meant the real interest rate is (-)4%". "This has created an alarming situation for households that are facing growing financial insecurity as a result of the widespread disruptions caused by the pandemic," wrote Shayan Ghosh, as their savings are being decimated. "In October, retail prices of meat, fish and eggs grew at 19-22% year-on-year. At 18% higher prices, pulses too are significantly expensive compared to last year," wrote Sayantan Bera. Prices are expected to moderate by February 2021, but "Global food prices rose for the fifth consecutive month in October led by cereals, sugar, dairy, and vegetable oil, the United Nations' Food and Agriculture Organization (FAO) said in its monthly Food Price Index." There is a possibility of a sharp rise in global inflation, wrote Richard Cookson. "As has been the case for many years, global inflation has 'Made in Asia' stamped all over it." "Prices are rising strongly, in part because Asian growth is humming." This, combined with loss of manufacturing capacity and restrictions on transportation may cause inflation to rise. If central banks in Europe and the US raise interest rates to control inflation some of the money invested by foreign portfolio investors (FPIs) in Indian markets may decide to go back which would put downward pressure on the rupee and raise prices of imports, especially oil. Maybe, that's why the RBI has been feverishly accumulating foreign exchange reserves, which reached a record level of $572.771 billion. "Economists were not impressed by India's latest economic stimulus aimed at boosting domestic demand by about 730 billion rupees ($9.94 billion) -- and some questioned if the new measures can spur long-term growth." What if it stimulates inflation instead? A faint heart never won a fair lady. In this case, Mother India.     

Connected licenses for connected companies.

"In a significant change of stance, large corporates and conglomerates could own banks if the suggestions of an Internal Working Group (IWG) constituted by the Reserve Bank of India (RBI) are accepted," reported the Financial Express. "For instance, large, well-run non-banking finance companies (NBFCs), with an asset size of Rs 50,000 crore (Rs 500 billion) and above could become banks post 10 years of operations once they pass the due exercise." The difference between banks and NBFCs is that banks are allowed to accept deposits from ordinary Indians and if large companies own a bank it may lead to "connected lending", wrote Udit Misra. "The recent episodes in ICICI Bank, Yes Bank, DHFL etc were all examples of connected lending. The so-called ever-greening of loans (where one loan after another is extended to enable the borrower to pay back the previous one) is often the starting point of such lending." "Interestingly, the IWG reports in its appendix that all the experts it consulted except one 'were of the opinion that large corporate/ industrial houses should not be allowed to promote a bank'," wrote Profs Raghuram Rajan and Viral Acharya. Apart from connected lending it will concentrate power in the hands of a few very wealthy individuals who own such companies. "Two years ago, India rolled out a laudable plan to unlock the capital trapped in some of its smaller airports," wrote Andy Mukherjee. "But the actual outcome from privatization was less than reassuring: All six airfields put on the block went to one bidder. If that's not enough, multiple media reports now say that Ahmedabad, Gujarat-based billionaire Gautam Adani, an early and enthusiastic supporter of Prime Minister Narendra Modi, might also succeed in taking control of the already-privatized Mumbai airport as well as a new one coming up on the financial center's outskirts." Adani did get Mumbai. Recently, "India's stressed asset deals are starting to look cozy. Local tycoon Gautam Adani's roads-to- mining empire narrowly outbid US based Oaktree with $4 billion bid for a collapsed housing lender, but it was submitted after a deadline passed and cheekily expanded on its original plan. It's the second time in just a few months that the industrialist has blindsided foreign buyers," reported Reuters. Already, "Jio Payments Bank, a joint venture between Mukesh Ambani's (India's richest man from Gujarat) RIL and State Bank of India, has sought the Reserve Bank of India's (RBI) permission to open current account of Reliance Industries Ltd and other group companies." A current account can run huge overdrafts. "There is a premise that expanding the number of banks and a supply of credit will fix India's problem of being credit starved," wrote Monic Halan. But, "Banks are not lending because of the fear factor as the clean-up in banking is opening up past decisions on loans." So why is the RBI even contemplating such a dangerous move? Maybe because,"Throughout history, the Union government has deployed three levers to control the RBI," wrote Bhattacharya, Bhatia and Devulapalli, and the present governor is a retired civil servant. Caught in vice.            

A quicksand of taxes.

The goods and services tax (GST) was introduced in 2017 to incorporate most indirect taxes in India, bring down the eventual tax paid by consumers by avoiding cascading effect, and "cast the country's tax net wider, with the value of input credits -- refunds of taxes already paid on inputs -- acting as lure for informal businesses to sign up", wrote an editorial in the Mint. Refunds were to be paid by matching invoices at different levels of transactions but the software had problems and so was given up. With no cross-matching of invoices some resorted to false claims of refunds based on fictitious invoices. "In response, the GST Council's law panel has reportedly proposed a stringent mechanism for GST registration that would double down on identity verification and other checks, with the speed of this process dependent on the 'trustworthiness' of applicants." "People have written about trust from Francis Fukuyama to contemporary writers to laboratory tests, a society does well when there is trust among one another. Then people begin to invest. There are lab tests showing the relationship between investment and trust," said Prof Kaushik Basu. The reason for more restrictive laws is that, "Despite a surge in October GST collections this year, the central government is still looking at a big shortfall in tax revenue, if the first six months of tax collections is anything to go by," wrote Dipak Mondal. The shortfall is expected to be Rs 6.2 trillion for the financial year. To compensate for high taxes on domestic products, "His (Prime Minister Narendra Modi) administration has repeatedly increased tariffs, licence requirements and other restrictions on imports," wrote Jairaj Devadiga. "For instance, the new iPhone 12 Pro is so expensive in India that it would be cheaper to fly to Dubai, buy it there, and return." Another reason for high prices in India is the price of fuel. India imported $102 billion worth of crude oil in 2019-20. The price of India's basket of crude oil has fallen substantially this year but the government has been increasing taxes relentlessly so that consumers are having to pay over Rs 81 per liter in India whereas the average price of petrol in the US on 23 November was 65 cents, or about Rs 50, per liter. "Our FDI policy woos investors in every international forum to India. Throwing bait to investors only for tax authorities to lay boobytraps and ambush them after putting their money in good faith is not just breach of trust. It scares away future investors too." wrote Capt GR Gopinath. Even though there were signs of recovery in October, as reported by Bloomberg, "If consumption weakens, inclines seen on may market offtake charts may flag off," the Mint opined. Taxes raise prices and make us poor. No consumption, no demand, no investment.