Talebearer
Mandarins in the economic ministries are keeping their fingers crossed and hoping that oil prices don’t harden again. Besides reining in inflation, they point out, there will be more good news for the government.
Succour for govt
Mandarins in the economic ministries are keeping their fingers crossed and hoping that oil prices don’t harden again. Besides reining in inflation, they point out, there will be more good news for the government. If oil stays at $110-120 (Rs 4,730-5,160) levels, it will cut the under-recoveries of the oil marketing companies substantially and the government’s bailout package will cost much less. Says a senior bureaucrat: “Our estimate is that if oil stays at the current levels, the burden on the government could ease by as much as Rs 40,000 crore.” Given the precarious fiscal position of the government, it’s something it can draw comfort from.
—RJ
Reddy for more?
RBI Governor Y.V. Reddy is expected to get an extension once his tenure ends. But senior North Block officials underline that they are not particularly rooting for Reddy. It’s just that in the UPA government’s last year, they are keen to ensure that there is continuity at the Reserve Bank of India. Says a senior North Block official: “There are many challenges before us— inflation is, perhaps, the biggest. We are keen to ensure that the RBI Governor, whoever he is, can continue with the central bank’s stance on key issues for one more year.”
—RJ
Mandarins in the economic ministries are keeping their fingers crossed and hoping that oil prices don’t harden again. Besides reining in inflation, they point out, there will be more good news for the government. If oil stays at $110-120 (Rs 4,730-5,160) levels, it will cut the under-recoveries of the oil marketing companies substantially and the government’s bailout package will cost much less. Says a senior bureaucrat: “Our estimate is that if oil stays at the current levels, the burden on the government could ease by as much as Rs 40,000 crore.” Given the precarious fiscal position of the government, it’s something it can draw comfort from.
—RJ
Reddy for more?
RBI Governor Y.V. Reddy is expected to get an extension once his tenure ends. But senior North Block officials underline that they are not particularly rooting for Reddy. It’s just that in the UPA government’s last year, they are keen to ensure that there is continuity at the Reserve Bank of India. Says a senior North Block official: “There are many challenges before us— inflation is, perhaps, the biggest. We are keen to ensure that the RBI Governor, whoever he is, can continue with the central bank’s stance on key issues for one more year.”
—RJ
