The monetary policy imbroglio

The monetary policy imbroglio

Monetary policy cannot succeed in India without the creation of a modern fiscal policy framework
Sebi cracks the whip on speculation

Sebi cracks the whip on speculation

Trading in derivatives far outstrips that in equities and is largely speculative. Sebi is taking steps to check this
A troubling but necessary ally

A troubling but necessary ally

From the US perspective, getting Turks to fight Islamic State is good news
Aadhaar and the right to privacy

Aadhaar and the right to privacy

The right to privacy requires a careful debate on how to secure it

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Reform lessons

There is one clear lesson for India from the three large economic trouble spots today: no economy can get back on track without structural reforms.
Consider what is happening in Greece, China and Japan. Each has had liquidity support from its own central bank or from multilateral lenders. Greece was forced to embrace austerity while the two Asian giants have splurged to support effective demand. But economists have warned right through that there has to be a third element to the strategy: economic reforms.
The Indian policy debate gives too much importance to demand stimulus, either through higher government spending or lower interest rates.
The fundamental flaw in such a strategy is that it seeks to deal with a structural slowdown with cyclical policies. Stimulus helps in the short run, but then the economy reverts to its new normal.
Just look at what is happening in China right now.
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