I am watching Bloomberg (the international one) to figure out how to make money tomorrow now. On India, there was a little news that said "India needs more investment to show growth" .
That's a reasonably fine statement until you see what "investment" it meant. Yep it's Foreign Direct Investment (FDI) . Odd the first thing that ran in my mind was "Did you guys run out of money already?"
Let me examine why on earth India needs more money now.
Could it be inflation and the devaluation of the INR in the world market? mmm could be, but it only brought down the country's total hard cash by 0.28% (approx) . The math behind is the percentage average change of the exchange rate against USD in the past 4 weeks. Is the country on so much low supply of cash? what happened to the "biggest economy in Asia" media crapping? In the end, it boils down to "where did my freaking money go RBI bit*hes?" I know you make a ton of money in the forex market with all the MYR and AUD I invested in your bonds. What did you do with all that? blew it away on new chairs and desks?
Could it be the economic downturn in Europe? Nah you get only USD 40 to 50 billion a year from there I think. You could make that anywhere if you tried. The US? oh call centers ran out of business? maybe but I don't have a clue. How about your software companies? are they still making money and bringing it back or hiding it in Mauritius and Cyprus? I know most payments happen in the Cayman islands to avoid taxes. Are these economic backbones in the name of Infosys, Tata not bringing in money?
I know you screwed up with coal mines, but that won't cost you so much to make you this poor! You are still exporting Iron, mica and copper pretty well. Where did all that money go? did you ship it for free to China? (yes china is the biggest buyer of Indian iron ore)
What the heck is going on here?
Fine I forgive you. But better be ready with your cash box tomorrow coz I want my money back RBI!
Let me see how the so called FDI can bring your sorry bottom into the two digit growth zone now. Back to economics 101!
Lets say I invest USD 2 billion in India and build a huge mother of all car manufacturing facility. Oh yeah my car brand is very famous in India. People sell kidneys and stuff to buy my brand. Now I hired 10,000 workers for the factory. Yay I am the savior! I am saving India from poverty! well that's what I want you to think. Look here kiddo, I ain't here for charity. I'll keep selling my brand of car in India until I siphon out more than twice the amount I invested. Why do you think I came here in the first place? to give you free money? in your dreams! evil laugh
So for every USD 2 billion invested in India, over 10 years, it is going to lose more than twice that amount in INR. Technically you are getting a loan with an interest rate of more than 300%? mmm makes sense because you are poor aren't you?
Fine get your FDI and screw yourself forever. Oh wait sorry for that! when you run out of money like this again, you would get another dozen FDIs wouldn't you? so you are locked in this vicious cycle of borrowing(FDIs) and losing forever right? Poor India, a 100 million engineers and doctors is not enough now is it? you could've promoted economics, finance and accounting in the education sector when you had the chance to get some really bright minds to manage your money. is it too late? I have no idea.
So what's next other than losing money and FDIs in alternating sequence? You could promote homegrown businesses more. No I ain't talking about the FDI sucking Mittals or Ambanis and the likes. How about the little guys who have something good? where's the innovation? where's the science? you wouldn't have to steal Aspirin and rename it as Dispirin shamelessly if you could just promote basic sciences. Why are you still stuck up on Engineering, Medicine and Marriageability India? (lol that has a cool abbreviation EMM. India has the EMM syndrome ;-) ) Why are you losing money like this with such a huge blunder?
All I can tell you is, please don't throw away your money like that. Yes every INR is "owed" to the governor of RBI. That doesn't mean that he or you can go around prancing like a queen throwing away money like this.
I maybe wrong, but until you prove to me what your real problem is, I'll think what is logical from my standing India.
P.S I don't think Walmart will make you a super power and make every citizen rich beyond dreams and have a happily ever after story. Why the heck do you need Walmart? just because the beer guy and a bunch of other idiots said so?
