27 November, 2020

Hold That Bubbly

The trends are good, but it’s not time to celebrate yet

Hold That Bubbly
outlookindia.com
-0001-11-30T00:00:00+05:53

THE silver lining started appearing six months ago. Rising cement and diesel consumption were the early signs. Then came reports of increased sales in the auto industry. Now, with credit growth up and the industrial production numbers hitting 14-month highs, even sceptics acknowledge that a recovery is on. So the question is: when do we pop the champagne?

Two years of recession had sent a clear message to industry: shed the fat, focus on core competencies, sweep away inefficiencies, become cost-conscious. Shape up or ship out! Many heeded the message and trimmed their operations. Banks focused on bad debts, ensuring that the undeserving got no money and the efficient got it at historically low rates. Two years on, we see a new breed of lean fighting corporate machines.

The real push, however, is likely to come from the farm sector. Agricultural production has exceeded expectations again. The rabi crop has grown 50 per cent in the last decade. A rise in farm incomes has significant impact on consumer spending. In...

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