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Adamant government is a surprise.


I am little surprised at the insistence of government and its senior ministers' adamant stance at such a breathtaking reform measure as FDI in Retail and capping of LPG cylinder for households. Something is amiss. These savy people don't do anything random and my guess, this too is NOT random.

Here I am throwing up another theory in the air. Here goes:

It is widely known it takes about a quarter for any policy to make an impression. And it is also widely known the three months prior to elections decide the votes, irrespective of what happened previous years. So, basically, politicians are trying to figure out the best way to give you 'good times' before the elections hit. If you dont believe me ask Ben Bernanke, he just wrote a $1.5trillion check to help Obama campaign. How can you ensure that people are happy 6-8 months down the line? Simple, kick all the bad news in one shot.

It should take atleast about 3 months for the inflation etc to figure in the consumer spending. With the worst of the "needed" reforms. With the investments too kicking in by March next year, you should have a great feel-good atmoshphere heading into elections.

Also, these hypothesis would be insync with the rumors of possible early election in 2013.


Conclusion: Add an adamant government and factor in some early elections, it becomes clear why this government wants no roll back.

[Although, it is little hard to believe why Congress would want to have a early elections]

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