Not artificially hold on to dollars such that the rupee is cheaper. In effect stop the subsidy on the exporters and a tax on everyone else. Inflation can go down if they let the rupee slide down. May be full convertibility.Sandeep wrote:What else can RBI do with the Rupee?
Indian Economy
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Re: Indian Economy
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Re: Indian Economy
Mr Anand Sharma, Minister for Commerce, Industry and Textile, Government of India, shared his views on the future outlook on the Indian economy. . Check out the view of Anand Sharma on Exports in India http://www.ibef.org/resources/perspectives.aspx
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Not at all true!!! Our government desperately wants the Rupee to appreciate, there is noway it is artificially weak, that is a very wrong perception. Even though the oil prices have come down worldwide, India is not able to take advantage of it due to a weak Rupee. Oil is one of the reasons why our fiscal deficit is bloating and why would our government take such a step as artificially depreciating the Rupee and worsen the situation?Not artificially hold on to dollars such that the rupee is cheaper. In effect stop the subsidy on the exporters and a tax on everyone else. Inflation can go down if they let the rupee slide down. May be full convertibility.
With regards to export incentives, we need to do whatever we can to improve our exports. We have a huge trade deficit and the gap is widening further, increase in exports is not at all in sync with increase in imports. I don't understand your logic behind stopping subsidies for exports. Having said that, no subsidy is going to help India revive its exports unless we pick up our manufacturing sector. There is an immediate need for labor reforms, otherwise manufacturing will die in India. If we want to keep up the pace with ever increasing demand for imported goods, exporting manufactured goods is the only option. You can't live off your entire life only exporting minerals and software products!! India has to realize this. Basically, we have messed up with everything and got our priorities wrong. India is in for a deep financial crisis in my opinion, achieving a 6% growth will also be very difficult in future when 8% should have been a given. I am convinced that we are doomed unless Congress is kicked out from the center which is not going to happen anytime soon!
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Re: Indian Economy
In order to subsidize our export industry, which employs people, I suppose. All the Asian countries do this. They do this to keep the export industry employing people. In a way everybody pays subsidies to these industries in this way. I do not know if this is sound economics, but, I suspect not. Artificial weakness of rupee. Chidambaram openly argues that we should do it. DevaluationSandeep wrote:why would our government take such a step as artificially depreciating the Rupee and worsen the situation?
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Re: Indian Economy
Raghu Rajan is the new RBI governor
Kudos to India for appointing a man of his stature. Rajan predicted the US financial crisis back in 2005 and was vilified by the criminal banking cartel - Bernanke, Geithner et al.
Kudos to India for appointing a man of his stature. Rajan predicted the US financial crisis back in 2005 and was vilified by the criminal banking cartel - Bernanke, Geithner et al.
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Re: Indian Economy
When did we start appointing non-career-bureaucrats to such posts? The guy is only 50 for crying out loud! Jay
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Re: Indian Economy
Yes, he is the youngest to become RBI governer since 1949 at 50.
I guess they are trying hard to revive the economy but it is difficult to undo all the bad work done by UPA II highlighted by series of scams.
I guess they are trying hard to revive the economy but it is difficult to undo all the bad work done by UPA II highlighted by series of scams.
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Re: Indian Economy
Hmmm...jayakris wrote:When did we start appointing non-career-bureaucrats to such posts? The guy is only 50 for crying out loud! Jay
And an Electrical Engineer to boot
Think it is a refreshing change from the recent American appointments to comparable positions.
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Re: Indian Economy
jayakris wrote:When did we start appointing non-career-bureaucrats to such posts? The guy is only 50 for crying out loud! Jay
That was my thought exactly. Maybe there is hope.
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Re: Indian Economy
I like this appointment too but I just hope that our system doesn't transform him into another useless bureaucrat.jayakris wrote:When did we start appointing non-career-bureaucrats to such posts? The guy is only 50 for crying out loud! Jay
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Re: Indian Economy
Indian RBI governor has very limited or no role in financial decisions and should not be compared to other countries. Our economic decisions doesn't make any sense at all, so it doesn't matter if it is Raghuram Rajan or Lalu Prasad Yadav at the helm of RBI affairs. India has become hopeless in the last 5 years.
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Re: Indian Economy
Manmohan Singh also became RBI governor at the age of 50
But the appointment of Raghuram Rajan is an excellent one. He is eminently suited for the role, but will find himself hamstrung by politics.
The basic issue here, of course, is that the Congress/UPA2 has destroyed the Indian economy, and there isn't much the RBI governor can do when he takes over next month to stem the rot. However, a more pragmatic and reform-oriented government could work wonders in combination with a strong RBI governor like Raghu.
But the appointment of Raghuram Rajan is an excellent one. He is eminently suited for the role, but will find himself hamstrung by politics.
The basic issue here, of course, is that the Congress/UPA2 has destroyed the Indian economy, and there isn't much the RBI governor can do when he takes over next month to stem the rot. However, a more pragmatic and reform-oriented government could work wonders in combination with a strong RBI governor like Raghu.
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Re: Indian Economy
Sorry for being dense, Atithee. Rajiv was the PM during my latter school years. I remember him doing some pro-poor things, some liberalization, and some moving away from the USSR, some corruption. My impression was that he was about average. Maybe that is why I am missing your point.
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I think Atithee is only saying that Rajiv Gandhi was prettty young by Indian standards. In retrospect, he was not a bad PM though, despite making some mistakes here and there. Jay