Simplified Laws Guide to Taxation and Legal Concern Look at our fate! A government with full majority is at the Centre, led by an aggressive Prime Minister. The Prime Minister wants to give water to electricity, good roads to speed rails, kinder gardens to garden variety of Universities and what not to the people of this country.But where is the money?
Increase in oil prices – the oil prices have gone up from 100 USD/ barrel to 113 USD/barrel. Rise in oil prices means higher import bill for the country.
Higher and continued Subsidy: Government was about to de-control diesel prices; but now it won’t be possible. If they have to de-control, they may have to increase the diesel price by over Rs.5 per litre. So, diesel subsidy will increase and continue for some more time. So, the money which should have gone for development will go towards import bills!
Higher Inflation– Of course, government can’t take the entire burden, so they will increase the prices of Oil. This means higher cost for the fuel and thus leads to higher inflation in the country.
Delay in new projects: The animal spirit of the people will take a beating. Everyone will wait and watch during Q2 of this Financial year before implementing an expansion plan or new project plan. This means delay in improving Indian Economy.
Forex (foreign exchange Reserve): The dollar against rupee will go up to 65 or so. This means the Forex reserves of the country will shrink.
New Issues to address– Tension in Middle East is the new area of focus, rescuing Indians from Iraq, spending time and energy on India’s strategy in the international scenario will dilute the focus on developmental issues.
The secret of crisis management is not good vs. bad; it’s preventing the bad from getting worse.
