Don’t underestimate the role of push factors
It is important to stay calm in an interconnected global market where volatility can have multiple root causes
We have a tendency in India to move into introspective mode rather quickly when confronted with foreign criticism or adverse global circumstances that affect us directly. A recent, dramatic example is the spate of navel-gazing prompted by Barack Obama’s recent warnings on the dire consequences of the splintering of India on religious grounds unless we manage the extremist tendencies of a few. A more mundane, but perhaps more important manifestation of this tendency is frequent and panicked commentary on what the vagaries of foreign capital flows to India say about the state of the Indian economy.