Thursday, March 13, 2008

A blog post on Indian economy dated 2011

Recently I found out how to go in a time machine and going ahed 3 years, I got the following blogpost from http://www.theagni.com/ and I though I will publish it after coming back from the machine.

How to ruin a nation in few simple steps

New recipe from Mr. Chidambaram................................................. Dated March 13, 2011

There used to be a time (maybe >5 years ago) when I used to long for India getting mentioned in international media. And the day came, and India became a rock star of world economy. Everybody who was telling India-Pakistan, were just uttering India-China in the same breath. People were as excited as hell, and optimism run sky high. Even this author was so excited. So, far so good. But, when it gets to the head of rulers, optimism becomes arrogance and arrogance leads to misgoverning and misgoverning leads to downfall. As India started to progress, its rulers started to plot its own downfall. They prematurely curtailed the reforms process that gave a ray of hope to a dying Third world nation. They waivered trillions of rupees of loans made to unworthy borrowers (including some farmers) and destroyed the backbone of banking system at a time when the world financial system was hemorrhaging. It is no coincidence that the only two times that India went bankrupt in his history was following two loan waivers of the last 20 years. The first one in 1990-91's National Front's budget led India to bankruptsy in 1991 and second one in 2008-09's Congress' budget Indian went insolvent in 2010. Interestingly, Mr. Manmohan singh rebuilt from the ruins in the former disaster, while he led to the ruins in the latter disaster.

It also didnt help that they postponed a crucial opening up of banking sector to globalization and they maintained a highly fragmented Indian banking system saddled with big unions and highly inefficient process. Slowly the banking system started to collapse and by 2010 the banks didnt have any cash to lend, pushing everybody (including farmers) into the mouths of money sharks. Mr. Rahul Gandhi, who knew not a word to speak in the Parliament, suddenly woke up in his sleep on March 13 to deliver a 11 minute speech to a bunch of supplicants that increased the loan waiver by many times.

The opening up of retail (a sector that was once worth $300billion) was stopped in its rails by the "Big Mother" a symbol of a ultraPower (written in NewSpeak) who in the period from 2004-2010 cast a complete shadow on India and broke the nation to pieces before moving back to the Latin lands. A sector that once held hope to pull millions of poverty from an Indian quagmire called agriculture by streamlining and simplifying the process of good transfer was killed in cold blood, at the instance of few middle men (called kiranaKiller in Orwellian NewSpeak).

And as the government kept dancing in approving foreign investment and made business process even really harder by keeping the failing bureaucracy, the foreign corporations said "enough is enough" and put an end to their patience and packed home. Stock Markets that was once hovering around 20K (yes, it really was) before it went on a historic slide to the current levels of 200. 25 of the Sensex 30 companies have filed bankruptcy. No more foreign investors to fill in the gas balloon. :-(. India's oil subsidies due shot to $500billion before ONGC, Oil India and BP filed their bankruptcy. Now, people fill their automobiles, by scavenging stuff, inspired from the 2007 movie "Iam Legend". Same is the case of fertilizer and every other stuff that Indian people thought were free stuff to be misused. Water, Kerosene and every possible stuff was horribly subsided to the "poor" at the insistence of "Commies", some of whom returned back to their lunatic asylums (to the detriment of its rest of inmates) and some also made pilgrimage to Moscow, Cuba and Venezuela and singing songs daily. The once hopeful US-India nuclear deal was flushed in the toilet and the US President refused to reopen the deal summarily. So, there is no more electricity in India, now.

Manufacturing that was already dying to a woeful neglect of infrastructure and even present bullies in government bureaucrats died completely in 2009. The remaining performing members of the nation As the failing nation couldn't survive the outflow of money and without anything to import (save a few call center calls, and some software) the nation went once again begging to international agencies. But, this time Mr. Narashima Rao was no more there, and Mr.Singh has been taken along with the Pet dog, a parrot and a couple of cats grown by "Big Mother", back to the Latin lands (how can the Big Mother stay when India has problems). Her son went back to his date in UK and her daughter is happily enjoying hot sands of Mauritius. Mr. Chidambaram (who took "Deception 101", "Misleading 203" and "Misgoverning 404" courses in Harvard Business school with George W. Bush in 1975) has presented India's last budget in 2008 (later budgets were cancelled as there were no revenues to budget) and joined with Mr. Singh and rest of the pets and puppets of Big Mother. Its happy, happy time for all of them, running and picking up balls, and playing with water fountains. In the meantime, millions of Indian farmers are committing suicide (the number was in hundreds in 2oo8 when there were healthy banks) and there is widespread hunger and famine. there is no more employment, no more value for rupee and nothing anymore. Hey, but who cares. You didn't think about that when you voted, and didn't voice when government was misgoverning, so why now.

Some news articles that preceded the downfall:
http://afp.google.com/article/ALeqM5im8omrGzSBx4aeR8TQhDVmnKaz0g
http://www.forbes.com/fdc/welcome_mjx.shtml
http://www.economist.com/opinion/displaystory.cfm?story_id=10808493

14 comments:

Krishnaraj said...

pyI'm continually amazed by a kind of public blindness to the obvious realities around us. I don't want to go into details, arguments, justifications etc. because they obscure the big picture. I don't want to talk about global warming, unsustainable growth, extinction of species etc. because they seem like distant theoretical stuff to us.

I'm stating a fact as bluntly as possible: our lifestyles are about to take a big hit.

The world economy -- and with it the India economy -- is coming unravelled. Please stop believing in bullish projections; the government and big businesses are just kidding themselves and kidding us that all will be well.

Our current world order, which we broadly refer to as our economy, has been built on too many untested assumptions. What we -- and our economists and governments -- firmly believe as solid bedrock is only shifting sand, and the sand is shifting uncomfortably beneath our feet. The superstructure that has been built up in the past two or three decades is far more than this sand will continue to bear.

We keep telling ourselves and each other that the shifting is only temporary, like a bit of stock market bearishness. But this shifting is not so temporary. Big adjustments are starting to happen which may take 60-70 years to completely settle down. These changes -- the collapse of an unsustainably tall tower -- will not end in our lifetime.

What does this mean? Firstly, it means that the kind of rich urban living that we take for granted is about to become impossible to continue. We cannot change our habits of living and thinking, but we are about to have them changed for us, most drastically and unpleasantly.

We can no longer live by intellectual labour alone. We are about to have a large amount of physical toil thrust upon us. Large numbers of us will die because they are unable to physically, psychologically or socially adapt.

Our children are growing up under the illusion that they shall live in a comfortable world like ours. I'm afraid that is not the case. Their lifestyle may resemble the lives of cotton farmers in Vidharba... and that is if they are fortunate.

Our living conditions will very probably resemble what is available in Afghanistan or Iraq. We shall all have to get used to living and dying with that level of daily discomfort, uncertainty and deprivation. Our cities will become largely uninhabitable due to a sudden drop in the level of infrastructure and of livelihoods. Jobs will vanish overnight, and so will power supply and water supply. Transportation will become patchy. There will be a huge drop in mobile, telephone and internet connectivity as well, and a huge rise in costs.

Savings will vanish overnight as markets and banks collapse. Galloping inflation will make currency almost worthless.

Our psychological and social skills will be the key determinant of of our continued survival. A vast majority of us, whose skills have wasted away due to easy living, will not make the cut.

All this is set to happen within the next two or three years.

I make this deeply uncomfortable statement because I believe it is true. I hope that understanding all this will help at least a few of us orient ourselves, brace ourselves, our kids and our old folks for the hurricane of events that is about to unfold with terrifying speed and inevitability. Knowledge and forewarning is what enables us to adapt and survive.

And yes: admittedly, I am stating this because I am deeply anxious. Sharing my thoughts with friends helps me relieve my anxiety a bit.

I really want us all to come out of our comfortable mental burrows and face our future with open eyes and minds. Our response doesn't have to be catatonic; we don't have to freeze up like rabbits caught in the headlights, doing nothing but waiting for the impact. It doesn't have to be blind panic... but it doesn't have to be pure denial either!

There is a very tiny chance that we can all strategize the best way to face the impending crisis, provided we recognize it early enough to take action. It seems wildly optimistic to think that substantial numbers of citizens can get together, discuss and act intelligently, rather than getting caught up in ego-battles. It seems even more optimistic that they can convince the government at various levels to be truly proactive and do something truly different.

But I prefer to believe that such things can happen in the months to come. Come, let us put our heads together and make them happen. Contact me at earthspirits3@gmail.com or phone me on 9821588114.

Warm Regards
Krishnaraj Rao
Mumbai
http://friendlyghost.rediffiland.com
http://globalwarming.rediffiland.com

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