India tagged its economy to that of the US and now the country faces fiscal and economic collapse
Bharat Subramanium
Oct. 4, 2008

Indian PM Manmohan Singh has ruined the Indian economy just like George Bush ruined the American economy. The biggest mistake for India was to open up its shores to American, European, and Japanese businesses. Tagging Indian fiscal policies to that of the US was prestigious at first, somewhat rewarding afterwards, and now proven to be outright foolish at best.

American stock market node dived 30% from the peak. Indian Sensex has lost for than 50% in much shorter time. India faces a Great Asian depression that will be comparatively short lived while faces a long drawn multi decade milder depression. Four years from today (if political climate do not change) or earlier, India will realize that America is neither a superpower nor a pillar of economic strength. As gold price in US Dollar reaches $5,000, oil trades at $600 a barrel in 2012, India and the rest of the world will realize that time has come to adopt Euro currency as the world’s bench mark instead of dollar.

The $700 billion bailout package is just a few drops in the bucket. American budget deficit will triple in the next five years because of the lack of tax revenues from the depression in America. But that does not provide any cure for Indian economy and the middle class of India. Indian Rupee is already trading at Rs. 47 to a US Dollar while US Dollar is losing its face value exponentially. India faces much stiffer pain than America. You cannot blame America for it. Naïve, less informed, and careless Indian politicians got carried away when Americans for the first time showed interest in India. Outsourcing became the part of life in India. Now India has no choice but to face the nastiest depression any country has ever faced since the Romans after Constantinople. India will eventually blame the Americans. But it was the Manmohan Singh type Western educated naïve Indian politicians who dug India’s economic grave looking for goodies and a say in G8. Well G8 is now is G0 as the financial meltdown has created farce of the economic system of the world.

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