This Independence Day, I got an SMS from a channel partner celebrating the
day and also hoping for the revival of the market. In fact, in the past few
months, especially since the new government assumed power, talk at any gathering
has been revolving around when the business will revive. The initial euphoria,
which was mirrored by the rising stock exchange exhorted that the worst was
behind us. Post budget, the spirit was still positive but now it is a dead calm.
Optimism has run its full course and now is the time to have a re-look at
what will actually happen. So what has changed in the past few months that has
lead to the this calm, this acceptance that the worst may be behind us but the
good times are still a bend away. It all boils down to a conversation I had with
a channel partner in Bengaluru about a year ago. At that point in time the
recession was full in full swing and spirits were down, but the partner was
confident that while his city will be hit badly by the global meltdown, the rest
of the country would emerge largely okay. His reasoning was quite simple, India
is still a largely agrarian economy and a good monsoon would ensure that the
country would not skew it growth curve by a great extent. And that is what
exactly happened. While some sectors were badly hit, but largely we still
recorded 6.9 percent growth. With that backdrop and a stable government in
place, there was every reason for people to rejoice.
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| shivangi yadav |
But then the rain god played hooky, and warning about a possible drought
cropped up. As rains got delayed in most parts of the country and Lord Indra
happily skipped some regions, the prospect has again turned gloomy. Its not like
the rains have not come at all, in some instance they have come a little too
late and have managed to inflict substantial damages to the crops. And when
crops get hit, the panic button is hit. That is the plateau on which we are
operating now. The government is in the midst of a full blown crisis tackling
mode, the hoarders have started inflating prices of essential commodities and
the increase in inflation will mean low consumer confidence. With foreign
investors playing shy and crops failing it is no wonder that the spirits are
down.
The small signs of revival that we were seeing are all being drowned out and
the people are operating very cautiously expecting harder days ahead. So will
December actually bring in good times? Hard to say. In fact no one is willing to
make any predictions now.
You might think that even I have become glum, but like the eternal optimist
that I am, I would like to point out that this is exactly the same situation we
were in last year. In fact if I might say so, we might be a wee bit better. The
Nielsen Global Consumer Confidence Survey states that consumer confidence in
India is again on an upswing, registering a 13 point rise, with 66 percent votes
Indians are the most optimistic that India would be out of an economic recession
in the next 12 months.
So here's hoping for the best sometime soon.
(shivangiy@cybermedia.co.in)