If markets are looking forward to a favorable industrial production (IIP) data as an indicator going forward then there may not be anything surprising for them.
With all the negative indicators around us and especially the central government’s steps to curb inflation, naturally Industrial production data will take a beating.
What the government has done so far is a necessary fist and must step even though the results will not be bear any fruits. The next logical step is to attack the massive trade deficit in the light of soaring crude prices. There are many things that our government and citizens can do to collectively fight this inflation menace.
1) Government should not subsidise petrol at the pump. Let market forces dictate the price at the pump. This step requires tremendous courage by the existing government especially in an election year.
2) Indians should rely more on mass public transportaion system and reduce oil consumption.
3) Encourage people to move towards natural gas alternative by building required infrastructure.
All the above steps will result in closing the trade deficit gap and help the government in fighting inlation and spend the foreign exchange in helping agricultural sector to become self sufficient in food grains.
