Inflation Decoded
Namaskar!
Inflation is an emotive issue for all of us. While all of us experience it, some understand and most of us are clueless and helpless on how to deal with it.
Through my post, I am trying to decode the current spell of inflation which Indian economy is undergoing both from an economist view as well as a common man's experience.
A good understanding of the disease (inflation), its symptoms (price rise) and identify the germs (root cause) is important before we start a treatment (solution). Unfortunately, experience shows that we have been trying to given pills to allure the symptom rather than fight the germ.
I hope this post would be helpful. Please do provide your inputs and feedback. more
Inflation is an emotive issue for all of us. While all of us experience it, some understand and most of us are clueless and helpless on how to deal with it.
Through my post, I am trying to decode the current spell of inflation which Indian economy is undergoing both from an economist view as well as a common man's experience.
A good understanding of the disease (inflation), its symptoms (price rise) and identify the germs (root cause) is important before we start a treatment (solution). Unfortunately, experience shows that we have been trying to given pills to allure the symptom rather than fight the germ.
I hope this post would be helpful. Please do provide your inputs and feedback. more
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Are there any experts who can add their insight on economics of usage of ethanol for doping with petrol. more
Jun 19
Good to hear the noise about action against hoarders, but have the hoarders been identified? more
Jun 18
Yesterday in my post I had mentioned "it has been observed that this sector is highly concentrated in state of Maharashtra and that too around Nasik. This excessive concentration creates sudden price spikes if supply was to get impacted due to crop failure or cartelization." Today, we hear that onion traders in Nasik have gone on strike. http://aajtak.intoday.in/story/traders-strike-in-nasik-onion-mandi-prices-may-rise-1-767919.html The question is why has all the onion production been concentrated in Nasik? Well Nasik soil and weather is conducive for horticulture activities not only onions but grapes and a range of other fruits and vegetables. But so are many other locations in India that are equally conducive if not better. If political masters decide than best of the fruits can be grown even in a desert. The other question is why has it not been developed in other areas? Onion cultivation does not require any special weather or soil. Well if it were to be grown all across then it would not be possible to get cartel type control over it. Now let me stop here, as we all know who controls sugar and onion trade in Baramati and Nasik. more
Jun 16
Our prime minister is visiting Bhutan. I sincerely hope he is able to get started on several more hydro power projects. more
Jun 16
A comprehensive agriculture sector reforms is required to clear the hiccups in production and supply of agricultural produce. 1. High fertilizer input dependent farming has to be changed to integrated, resource renewing and recycling, organic, low cost, high yielding and profitable one. 2. Rice and Wheat dominated farming has to be made diversified and varied. 1. Domestic production of pulses and oil-seeds have to be increased through focused efforts by increasing productivity in traditional pulses producing areas, extending pulses cultivation in new areas and producing it as part of inter cropping or crop rotation in non-traditional areas. 2. Deregulate and revitalize the Sugarcane farming and industry by fully exploiting bio fuel potential of ethanol and incentivising cultivation of better quality sugarcane. Expand sugarcane cultivation in new with the aid of drip irrigation. 3. Promote Special Cultivation Zone and Food Park on lines of SEZ in large tracts of land in close proximity to large cities and metros. These SCZ would have composite infrastructure for cultivation in open fields, poly hoses, processing, packing, storing and transportation. This would facilitate this segment to get consolidated and organized. Add on costs of processing, packing and transport too would decline with scale of economies kicking in. Market forces are like natural forces, there would be a sudden surprise just when we think we have tamed it. Instead of attempting to control these forces by working against it, we need to channelize these forces to our advantage and work with it. Our economy would be in good shape as soon as our economic masters learn this secret formula. more
Jun 15
