One of my friends raised a question in a forum in Economic Times which I produce hereunder and submit my opinion thereon.
“Do you think India's surging stock market and strong increase in industrial output and consumption will be a major catalyst to lead the world out of recession?”
There is neither an increase in industrial production and nor increase in consumption. People of India cannot afford buying even essential commodities. If we keep away negligible portion 5% of population which constitute rich and affluent people we will find that India is a country of poor, downtrodden and destitute where per family income is still less than Rs.2000/ a month which is less than even US $50/- .
As such there is hardly any scope of increase in demand and consumption and as a result our country mainly depends on exports and imports. India’s image is projected as the best or comparable with China by our media based on the growth of a few rich people who have been consistently growing and have been ranked in Forbe’s list.
But in fact due to global recession not only India's export has come down; it has adversely affected other sectors too which is visible in production datas released from the government. It proves India depends on global economy more than vice versa. Even agricultural production is not growing as planned by the government inspite of huge subsidies or fund or support said to have been extended by government.
I am unable to understand after all in what respect we are leading. In the recent survey India is categorized as the most inefficient country so far as the work of bureaucracy and that of babus and civil servants are concerned. Singapore has been ranked the most efficient and the top in the efficiency among 12 Asian countries surveyed by the Agency (Hongkong based research firm) whose report published today in Economic Times.
A country where corruption is all pervasive one cannot imagine of real development, real growth and real upliftment in status of general mass. Window dressing, manipulation of figures and concocted balance sheets are helping India in creating image. There are lacs of Rajus (Satyam) and millions of Natwarlals in our country. Even CAs and Doctors who are supposed to save the lives of Human beings and that of Corporates respectively have been found to be indulged mostly in illegal mining of money.
Only silver lining visible to me is that India believes in God and worships God very much devotedly and hence not that much sick of mental agony, depression and other mental madness as it happens in other poor countries. It is however true that India’s position was more pathetic half a century ago or even two decades ago. It is possible there has been slight improvement, but it in no way can be considered that India can lead the world or India can feed the world. One has rightly said that India is unable to feed its own one billion populations satisfactorily and it cannot dream of leading the world.
Stock Market is surging due to many other irrelevant reasons. It has nothing to say about the fundamental of the companies and neither does it reflect the true position of common mass of the country. A few brokers and a few FII have the capacity to twist the direction of Stock market as er their sweet will. If stock market is any indication than Mammohan Singh’s economy proved to be complete failure when sens*x came down from 23000 to 8000. When sens*x was around 23000, India’s position was not that much strong and India did not became the weakest when sens*x came down to 8000.Stock market is more a gambling, and less an indicator of health of India’s economy. Stock market cannot be considered as a yardstick to measure the country’s capacity to lead the world or to help the world come out of recession.
Obviously neither Industrial production data nor surge in sens*x can capacitate India to lead the world coming out of recession.
Danendra Jain
Agartala
CAclubindia
