No data has come to prove that economy is turning around. Re appreciation is just because of FII inflow is there. We have to wait and see how much FDI fund comes after opening of retail sector. On one hand govt has increased diesel price , after that 6% rise in 1.4 lac employees/pensioner will take away the benefit of diesel price from govt kitty. Till govt revist the pay scale and modify like it is doing for subsidy , my opinion is all benefits occuring due to cut in subsidy will be lost under the burden of salaries and pension head of govt . 6% hike is going to put pressure of about 37000 crore annually on govt whereas diesel hike will bring only 24000 crore. I feel analyst are overlooking this aspect and will awake when next budget is presented.
Recent announcement of hike in diesal/LPG price may release the 20% fiscal deficit pressure. Next step of govt to contain fiscal defficit, may be deinvestment in PSUs, such as, NMDC, Neyveli lignite,MMTC, Nalco, Oil india, Hindustan copper.
In another 2-3 months, after Bharat Nirman by spending 100 Cr, Billions will be offered in the name of socialistic cause by Sonia and loot by ministers will start. Can any ecpect fiscal deficit will contain - it will blown up further, UPA 2 have no inclination to reduce that since they are so much clingged to Kurshi - that they will do any thing even at the cost of India
May be. It also depends on external environment in Europe and USA. In this interrelated world, all are affected. There need to be better coordination amongst free nations. I am more worried about political situation in Arab world since the Arab spring is not being translated to genuine democracy. China is another hotspot which world fails to realise. There can not be free market economy and closed political system as we see in China. Sooner than later it will explode and that will bring doom.
PC is just milking common man to feed the monster Government which includes our politicians and Government employee. Without giving anything to common man how long our Government can milk the salaried class is a big question.
They have to work very hard.....and also they have to take some hard decisions by taking confidence of their UPA Partners...It is not easy but they have to take some hard decisions if they want wants maintain fiscal deficit well with in the control...