Generally speaking, the more margin for error a strategy has, the more likely it is to succeed. When the room to err is small, mistakes threaten the stability of the system, requiring an immediate change in priorities from strategic objectives to crisis management.
On the other hand, when there is a large margin, unanticipated developments are not as big a threat. Corrections can be made without turning the focus away from the long-term objective.
At this point in time, the Indian macroeconomy finds itself in an enviable position. The configuration of monetary and fiscal parameters today provides an assurance of stability that is tantamount to a huge margin of error for new policy initiatives.
The combination of low inflation, low interest rates, tax buoyancy and a revival of public spending on infrastructure together signal a very high likelihood of a significant acceleration in growth. More so, because the situation we are seeing today is almost certainly not just the result of temporary factors.
To make the case for persistence more concrete, let
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