Thursday, January 19, 2012

What might be the right thing to do for India Inc.


With the value of rupee starting to appreciate again (1$=50.30Rs.) as compared to previous low of Rs. 53.40, things seem to be getting back to track. Although this might me a little early to say so, but further signs and stimulus is provided by the increase in FII net inflows.

But among this positive environment two things bother me the most (apart from offcourse the poverty in India) :
1) Our current account deficit
2)Trade imbalances

and i believe the only solution to both of these problems is : To boost our Industrial and Agricultural Production. This is the only practical solutions to most of our problems and this seems quite obvious at first look but I don't understand why the policymakers are oblivious to it.

Industrial production can be boosted if government introduces some revolutionary reforms and acts which had been left in the back-burner. Also the government alone can't do much, help of the big industrial houses is also needed. They should be lured into helping by providing (tax) incentives. Since the EU is under huge debt burden this is particularly the right time to tap the European markets. The crisis doesn't seem to end soon.
Agricultural production can be boosted by revolutionizing the agricultural sector. Its indeed time for the second green renolution. Subsidies must be properly regulated, itroduction of better technology and genetically advanced seeds and crops are few means to boost the production.

Only by doing something that produces result in material form will be helpful and nothing else. We have been making policies for a long time and now its time to implement.  Jai hind!!

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