This refers to the column Tough trade-offs in inflation control (FE, June 2). Madan Sabnavis elegantly articulates the reasons why importance must be accorded to the reduction of CPI index rather than to WPI index which is currently under comfortable reduction. In regard to manufactured goods, the market is flooded with brands, whereas the demand is dismal. But goods like vegetables, egg, fish, meat and quality rice are on top, irrespective of the buffer stock position in grains so as it is pointed out by Surjit committee. The income on MGNREGA is useful for more consumption rather than to create assets. Hence, no pressure on inflation from that side. Looking into the fuel pricing and reduction of CPI are the ways to contain inflation at this juncture. The monetary policy may go for a rate cut, but that could not lubricate track for manufacturers tumbling with slow down and the resultant low demand. Creating resourceful jobs and reducing prices are the ways, otherwise trade-offs will be difficult.
The feudal way to taper
The Infosys stock has been languishing from 2011. The relentless exodus of its top men is not because of markets pessimism on its growth potential, but it is the other way round. The company, even after its multi-exponential growth, persisted with its founders as the CEO with centralised control over commercial decisions. This multi-billion-dollar megalith felt no need to fill up the position of COO since May 2012! In the last decade, like others, Infosys too acquired a more intellectually evolved set of hands. But these men were never brought into the line for grooming as the baton kept passing on from one founder to another. The companys loyalty to its founders perhaps continued to rate above the interests of its shareholders. Todays IT is not even about tomorrow but the day after and beyond. It would require a much younger and energetic pursuer of dreams than doyens of vintage, much less of the founder lineage, to be in sync with the rapidly emerging possibilities in modern day IT. Infosys is no doubt making profits, perhaps on its past reputation. But its top soil needs to be urgently replaced with fresh ones, with imaginative additives to promote vigorous growth. Else, the markets may not be as kind to it, when GDP picks up in a couple of years under the new political dispensation.