Expectations of Economic Revival

The Backdrop THOUGH the financial markets seem to signal positive expectations, it is as yet difficult to discern them in any physical indicators of economic activity essentially for want of more recent data. The mobilisation of $ 4.16 billion (over Rs 18,000 crore) through the Resurgent India Bonds (RIBs). combined with a normal rainfall situation and the government's promise of higher expenditure programmes for stimulating investment demand for capital goods, automobiles' steel and other construction materials, seems to hold out hope for improved industrial activity in the second half of the current fiscal year. The commercial sector, which faced an acute shortage of demand for goods and services and hence a severe liquidity stringency now for about two years, seems hopeful of seeing some respite from both these constraintsThe policy impulses emanating from the finance ministry for increased public expenditures and those from the Reserve Bank of India for improving credit delivery appear to reinforce these expectations.