Energy and economic growth are interrelated. What monetarist can do has limitation. Acute power shortage makes cold storages non-functional or mal-functional in all the states where vegetable production peaks. Therefore, cold storages are victims of NPAs in several banks. Energy sector is the villain of the piece. Oil imports are touching unsustainable levels and the current account deficit is mainly on account of oil imports. Remove the component of oil imports the current account deficit is in the most comfortable region. Investors are shy of India in the energy sector as the 'resource and reserves' in oil, gas - natural, coal do not lend confidence. In a dollar-dependent economy, gold reserves and controls do not have much relevance. What we should now target is a good fiscal policy and the government in election mood wants to throw good money after the bad - through ill balanced and misdirected subsidies is putting the cart before the horse.
- Yerram Raju
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