Options for income transfer: Agri exports appear to be a sustainable path

Agricultural exports appear to be the only sustainable and non-inflationary path to improving agricultural incomes

Hard indicators of consumption in India point to a two-speed economy. Upper-end consumption appears steady: Growth in sales of cars and consumer durables, for example, is healthy, and airline traffic has been growing so rapidly that there is runway congestion at Mumbai and Delhi airports, and travellers at airports like Bagdogra struggle to find places to sit. However, indicators of broad-based consumption are weak. Although growth in cement and steel volumes has recovered from the lows seen in the last 12 months, it is still half of where it should be. Volume growth in consumer staples (soaps and shampoos, for