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Ajay Shah: A call to arms for reforms

The non-oil, non-finance sector of the economy is under severe stress

Ajay Shah

In understanding the coming Budget announcements, we need to have a backdrop of economic conditions. While gross domestic product (GDP) data is the subject of debate, there is no disagreement on what we see with the nominal results of listed companies. The results for October-December 2015 show a difficult situation. Recessionary conditions are visible in sales growth and profit margins. Interest payments continue to grow faster than sales or profits, revealing a worsening of credit stress. These conditions are a call to arms for reforms. Two important components of demand in India are ...