Thursday, October 1, 1998
Diluting sanctions
When, after Pokhran 2, the US imposed sanctions on India, there was dismay in government--which it tried to hide behind a stiff upper lip--and in business circles. But the prospective relaxation of the sanctions, in the wake of the decision by the US Senate and House of Representatives to give president Bill Clinton authority to decide on waiving it for a year, has hardly evoked jubilation in the country.
Policy reversed
Reports indicate the centre has given state governments the power to fix the retail prices of single super phosphate (SSP). This is a reversal of its policy, as so far fertiliser prices have always been fixed by the centre.
Monetary condition index causes confusion
The developed economies are shifting from targeting quantity variables to rate variables, as the former no longer explains appropriately the changes in aggregate demand and supply. Some of the rate variables targeted are short-term interest rates, exchange rate or inflation.
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