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When is a good time for austerity?

There is a time for austerity - when there is a boom

Economy, economic growth, money, rupees, data
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Dhiraj Nayyar
In general, austerity is a good trait in governments, just as thrift is a virtue for entrepreneurs, just as there is wisdom in frugality for households and individuals. Perhaps, those are the foundations of any high savings, high investment and highly productive economy. But all economies go through cycles. How governments, companies and households behave in the different phases of the cycle matters. They could either exacerbate the booms and busts or smoothen the cycles at both ends. 

It is apparent that the Indian economy has a demand problem. Three of the four major engines of the economy are stalling, certainly
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of www.business-standard.com or the Business Standard newspaper

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