Consumption needs to revive

The cut in corporation tax rate could potentially boost margins of companies

It has often been said that a crisis presents opportunity. This week certainly had all the ingredients of a crisis and the government has responded with measures that helped reverse downbeat sentiment. It remains to be seen whether these will also help revive the economy.

The drone attack on Saudi Arabia caused near-panic. It was followed by the default of yet another Indian financial firm. Some good news in the form of the US Federal Reserve’s rate cut was expected, and it was discounted before it happened.

The substantial cut in the corporate tax rate on Friday was unexpected. So