Blame it on S.R.!!

India’s GDP growth for Aprl-June 2011 qtr. falls by 50% to 5%. As I have repeatedly pointed out that RBI governor with his ludicrous & anti growth, interest rate increasing stance has brought the growth of Indian economy down to its knees. And then they have the audacity of blaming the global turmoil for this slowdown. No way. The credit for this blunder goes to Subba Rao & S.R. alone. They have set their house on fire ( read slowed Indian economic growth ) & are now have the audacity of trying to blame a fire that is burning a hundred miles away( read slowdown in europe, USA). Developing economies –BRICS (Brazil, Russia, india, China etc)-are like growing kids in their teens who need huge quantity of food etc. but rather than increasing the supply, the RBI & govt. at the centre, by increasing the interest rates are giving bitter medicine to this growing kid ( read increasing interest rates to make finance costly....) with the hope that his appetite will decrease thus decreasing the demand. We did read such a story- is it Nicholas Nicholby?- as kids. In a recent candid interview the Chairman of SBI Bank admitted that there was nil demand for loans for new Greenfield projects from banks's customers. Yes you read it right, nil demand. And we know who is to be credited for this tragic achievement. But not all the central bank governors are being myopic. Brazil is a fast growing economy like India with a problem of inflation too ( inflation at a six year high in Brazil) & its Central bank reduced the interest rates recently there recognising the fact that the global economy is not yet out of woods & growth wherever it is, is precious & should be encouraged. He candidly agreed that monetary policy have effect with a lag – at least a year & who knows what the global economy will be one year from now? Pay heed S.R. to this!!!