Financial Meltdown, Domestic Unrest Has India Down

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Sourabh Mishra Sourabh Mishra
The cover illustration on this week's "Economist" summed up our current feelings in India in more ways than one. It pictures a figure, silhouetted against an angry red sky, on a crumbling cliff peering down into a precipice. The global, seemingly unshakeable, financial giants have had a very public "great fall," and now "all the king's horses and all the king's men" are trying to put things together again, hopefully with $700 billion. Going by the fate of the original protagonist in the nursery rhyme, people are rightfully worried.

The key local stock index (SENSEX) has crashed from 21,000 levels to 13,000 levels in the last few months. No wonder consumer sentiment seems to have dipped here after riding high for a long time, according to a Boston Analytics survey.

Marketing and advertising spends are heading southward in this traditional festive season marked usually by high marketing as well as consumer spends.

A series of bomb blasts across the country over the last five months have further battered people's morale. So now every time one goes to a crowded market or a crowded mall or gets into a crowded train or bus (the crowds are a given here, and they are what make the Indian market so attractive for global businesses), the tension is palpable. Suspicious glances at other shoppers, overworked security staff with their metal detectors all around, people missing a heartbeat even at the sound of a child's balloon bursting and nervous jokes about bomb blasts mark the average middle-class Indian's shopping expeditions today.

With the back of his mind worried about the falling value of his investments and the very real security threat all around him, is it any wonder that he is not in a particularly cheerful and festive spending mode right now?
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