Glitter versus gold in policy-making

Three years of slowing growth hold two important lessons for the Budget

With the economy stuck in the doldrums, attention is fast turning to the Budget on February 1.  The hope is that the government will turn on the spending taps. But if history is any guide, and as counter-intuitive it may sound, a quick fix like that may be the last thing the country needs to get back on its feet.
 
Our study into India’s three-year slowdown reveals some important lessons for policy-makers. Namely, what can look attractive at first glance, for example higher public investment and higher foreign exchange reserves, may have a sting in the tail.
 
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