Rollback time: What didn't work for govts earlier will not work even now

Long discarded policies like deficit monetisation, loan restructuring, higher tariffs and import licensing had not yielded great results even the first time around, points out T N Ninan

The economy is getting painted into a corner. Fiscal policy is boxed in by alarming numbers: Expenditure in the June quarter was 5.4 times revenue! Monetary policy has no room for manoeuvre, as seen on Thursday, because the policy rates are already negative in real (ie, inflation-adjusted) terms. While the government and the Reserve Bank find their hands tied, the resources available to the rest of the economy are constrained as gross domestic product (GDP) is expected to shrink by 5 per cent or more. Corporate profits as reported have fallen by about 30 per cent this past quarter, and