22 June, 2021

Partly Cloudy Skies...

...and thundery developments likely in many areas. That's 1996 for the Indian economy.

Partly Cloudy Skies...
Predicting the course of the economy these days is akin to predicting the weather. The unexpected and the unknown now influence economic events as never before. Besides, there are the unpredictable impacts of predictable events. 1996 promises to be one such unpredictable year.

Though the general elections slated for early next year are a certainty, what their outcome will be and how the new government formed at the Centre will change economic policies, and hence economic performance, is anybody's guess. There is a view widely propagated and tenaciously held that the economy works on the basis of its set (and hence predictable) "laws". Sure enough, there are some principles that govern the working of the economy, but all over the world crucial decisions relating to the functioning of the economy are taken outside it, most of them by governments acting on the basis of political compulsions. India is no exception: economic reforms initiated by the ruling party are redefining the role of the economy and reshaping its functioning.

The performance of the Indian economy in 1996...

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