Ominous slide   33 comments

‘No fresh investment is being made in industries.”
Month after month the basic indicators of economic growth are showing red signals, one more foreboding than the earlier one. Industrial production had been registering slower and slower growth for many months now and  the latest figures have actually moved into the negative territory.

The minus  5.1 growth shown by the Index of Industrial Production (IIP) for the month of October is the steepest fall  in 28 months and it may point to an industrial recession in the making. Before the intervening period of some, though sluggish, growth there was continuous contraction for over six months, as a result of the global financial turmoil and slowdown. Now the industrial sector is back in the same negative groove. There are indications that November figures, when they are available, won’t tell a different story.

The most ominous aspect of the October fall is that it is mostly accounted for by the non-performance of capital goods, manufacturing  and mining sectors. These are key areas that have the most say in economic growth. Capital goods production has fallen by a whopping 25 per cent and the contraction in the previous month was 6.5 per cent.

This is a reflection of the falling investment activity and loss of confidence of business and industry. No fresh investment is being made and there is a shying away from expansion of capacity. Only power production has shown some growth but this is bound to be hit now because of the problems associated with availability of coal.

Adding to the dire situation is the impact of the series of monetary measures effected by the Reserve Bank of India. The RBI had warned the government that its rate changes would not help if there was no supporting effort. Tax revenues  are falling and the fiscal deficit  going out of control.

The government’s hopes to contain inflation and maintain economic growth at above 7 per cent, expressed in the mid-term economic review, seem too ambitious in the present context. There is no justification in blaming the external environment for the slide in the economy.

It is the paralysis that has gripped governance that is the root cause of the malaise. The government has been weakened by a siege within and from outside and has shown no will to get the better of the situation. This is the crucial time for it to act if it wants to stop the slide, which is threatening to get worse in the coming months.

Posted December 14, 2011 by avinash2060 in Recession

Tagged with

33 responses to “Ominous slide

Subscribe to comments with RSS.

  1. Hi avinashrulzbangalore,

    Really nice blog. your post Ominous slide « Current Affairs – News That Keeps You … is very interesting. Thanks for sharing.

  2. What did you use to design your website? It’s really awesome can you send me an email and let me know?

  3. Hi! I assumed your publish was great and will go to frequently.

  4. As many others, now is my first moment posting here. I really like this site and see it quite often.

  5. Is that true? I’ll spread this information. Anyway, nice article

  6. Hello! I have read some of your post here and found it interesting and it makes a lot of sense. Plus i love your theme here. Thumbs up! Keep on sharing!

  7. Your home is valueble for me. Thanks!…

  8. Hey! I’ve saved your website because you have so nice posts here and I would like to read some more^^

  9. Be glad of life because it gives you the chance to love, to work, to play, and to look up at the stars.

  10. WONDERFUL Post.thanks for share..extra wait .. …

  11. Hi all, – spotted your current webpage by accident when looking round the web this afternoon, and happy that I did! I do like the page layout and colours, but I ought to mention that I’m having difficulty when it loads. I’m using Flock 1 web browser for mac, and the menu bit fails to align well. i am fairly certain made use of precisely the same design on a customer’s internet site, but the menu seems fine on mine. I imagine the problem is with my outdated browser & I’m guessing it’s about time to update!

  12. Hi folks, – discovered your web site by chance while wandering around the web this evening, and pleased that I did! I like the layout and different shades, but I should point out that I’m having difficulty when it loads. I’m using Shiira 1 web browser for mac, and the top panel won’t align completely. i’m confident I have made use of the same layout on a client’s online site, but the menu seems Ok on mine. I imagine the mistake is with my browser & I reckon that it’s time to update!

  13. Hey! That’s a really awesome post. If you don’t mind I’ll bookmark it to my Digg bookmarks.

  14. Hey! I’ve bookmarked your website because you have so great posts here and I’d like to read some more:)

  15. holy cow i like this post! would you mind if i shared?

  16. I’m quite about to make this step. This post got me thinking whether i can do it. Again. And thank you very much!

  17. Hi, i think that i saw you visited my website thus i came to “return the favor”.I’m trying to find things to enhance my site!I suppose its ok to use a few of your ideas!!

  18. very good publish, i certainly love this website, carry on it

  19. WONDERFUL Post.thanks for share..extra wait .. …

  20. Heya i am for the first time here. I found this board and I find It truly useful & it helped me out much. I hope to give something back and help others like you helped me.

  21. With all the doggone snow we have had as recently I am bound inside , fortunately there is the net, cheers for leaving me something to do

  22. I like the valuable info you provide in your articles. I’ll bookmark your blog and check again here regularly. I am quite certain I will learn plenty of new stuff right here! Best of luck for the next!

  23. Very nice post. I just stumbled upon your blog and wanted to say that I have really enjoyed browsing your blog posts. In any case I will be subscribing to your rss feed and I hope you write again very soon!

  24. This article was really nicely written, and it also contains quite a few helpful facts. I appreciated your expert manner of writing this publish. You’ve produced it quick for me to fully grasp.

  25. Pingback: manifesting wealth

  26. youjizz
    It is often very hard receiving people to check this out and even getting one watch. I’m a? pop performer whom life within Colorado. Keep in mind that even Adele,. Lady gaga, Bruno Mars, yet others was once dreamers. I want to promise that i’m not necessarily away here for the cash as well as insane attention. My spouse and i perform for you to encourage others never to give up. Simply no it’s not meant to? appear. old fashioned, it really is real. Plz click on my own station to view the material. Appreciate causeing this to be evening remarkable along with couple of members will make this. evening a lot more thrilled top free movies

  27. Hey! cool post you have there. Thank you;)

  28. Yes, i enjoy this blog as well! It make me to open my own. Hopefully will bring users to enter my website

  29. Just to let you know… your internet site looks very strange in Mozilla on a Mac

  30. Hello! I’ve been browsing your website for a while. You have really nice posts. Sweet job.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: