Dear Readers,

It is indeed heartwarming to publish the October, 2008 issue of the SRIMCA e-magazine “SRIJAN”.

At the outset, we at the editorial team of SRIJAN extend our very warm seasons greeting to all our readers. We also thank all those who have contributed their mite by providing their articles.

Dear readers, as this edition of our Online Journal goes in for the final proof, these are the turbulent times for the for the world economy in general and the mammoth US economy in particular. The events unfolding in the US and Europe have immense bearing on our own Indian economy, for the simple fact that ours is just not an economy that can at all be said to be decoupled from the world economy in general and the US economy in particular. In spite of repeated assurances by our learned Finance Minister ( and supported by The Prime Minister ) that Indian Economy is decoupled from the US one and that it can absorb the worst shocks with resilience and without much pain, the  events in the Indian Economy over the last two quarters go onto establish on the contrary. The projected   Hence in this editorial piece we have chosen to deliberate on this issue of global meltdown.

Our readers would recall that in the last issue of SRIJAN, we had dealt at length the perils of Global Warming, whereby it was established that it had become the most debated and serious issue the world over. While, no doubts, the GLOBAL WARMING is certainly an important issue for the twenty first century, whereby our posterity is at stake, the burning and urgent issue of the eighth year of the twenty first century has turned out to be ironically the GLOBAL MELTDOWN.

Of course we need to tackle the urgent ones first. The Indian GDP growth rates are already revised from the stellar 9% to 7% for this fiscal. And given the trends it is not unlikely to revise it to 6 % for the next fiscal. While 7% and 6% may still be considered to a respectable growth by any standards, what is worrying is the change in direction of accelerated growth projections to a steep deceleration.

If our performance since opening of economy in 1991 is any indication, we have got to come to terms of the fact that our Economy has moved in tandem with the Global clues. For example, IN THE 1990S, a booming world economy first lifted Indian growth to new heights for several years, giving an illusion of its permanency.  However, as in the late 1990s, this time also the subsequent global slump is going to cause an Indian slump too.

However on the flip side, I must admit that we are better prepared for this downturn than we were in 1990s. In fact our FOREX reserves at about $300 billion put us in a comfortable position today. The India Inc has not bloated its Balance sheets with debts at exorbitant interest rates, sometimes as high as 20% PA.  Our banking sector is better positioned today and our domestic savings rate has just crossed 30%. These can continue to pump fresh investments in key infrastructural sectors like roads, power and telecom.

Nonetheless, India will not be able to ride through the rough whether painlessly. Income and job opportunities will shrink. Many businesses, especially the small ones may be on their way out. Credit will be scarcer and dearer both for the consumers and corporates. Al this will lead to a decline in the exchequer revenues, which in turn reduce the ability of the state to mitigate the distress.

So be prepared for the tough times ahead.

However, to rap up the piece on positive note, we are proud of our maiden performance of Indian contingent at Beijing Olympics. Like every Indian, we are proud of Abhinav, Sushil, Vijendra and Akhilesh. And we look forward to seeing India achieve glorious heights at London.

Signing off for now…

The Srijan Editorial Team