A Much Needed Turnaround

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Abstract: 

On the morning of August 17, most of India’s economic policymakers gathered in the Prime Minister’s house in Delhi. The mood was tense. India, said Manmohan Singh, the Prime Minister, faced ‘very difficult circumstances’. So began the story titled “India in Trouble: The Reckoning” in The Economist magazine of August 24, 2013. The story went on to offer a chilling account of India’s troubles. News on the economy had been disappointing for two years, with growth falling to 4-5 per cent; consumer-price inflation
had remained stubborn at 10 per cent; the current account deficit had soared to almost 7 per cent of GDP at the end of 2012 and was
expected to be 4-5 per cent in 2013-14; and the rupee had dropped to an all-time low and 13 per cent below its level just three months
earlier. “It is widely agreed the country is in its worst economic bind since 1991,” concluded the story.