In my Economic Collapse News Update on May 24, I had written the following in the introduction: "Most analysts who were not on the payroll of the banksters / gangsters that run the world warned that the emperor had no clothes, especially in regards to India." For several years now, India has been promoted as an Economy to rival China and the US. Some Indian people I spoke to a few months ago were so taken by this media illusion that they deluded themselves into believing that India would one day overtake China as the 2nd largest Economy in the world. I could only shake my head in disbelief at such ignorance of the facts. However the fact is that facts cannot be hidden forever, and only now is the truth of India's true and sorry Economic condition coming to light as the following CNBC report details. I stand by my conclusion that before the end of this decade, India will either be devastated by civil war or will be involved in a amjor war with Pakistan, and possibly even China; these wars will be the cover that will be used to deflect blame for the nation's Economic woes from the corrupt politicians and corporate leaders to foreign powers.
When promising tech company Subex sold $180 million in five-year convertible bonds in March 2007 to fund the acquisition of a Canadian technology company, India was at the height of an unprecedented market boom.
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The economy was growing at more than 9 percent a year, the Indian rupee [INR= 55.71 0.525 (+0.95%) ] was rallying towards a record high against the dollar and the Bombay Stock Exchange's main index had surged six-fold in the previous five years, even trumping the performance of China's much vaunted Shanghai stocks.
Today, India and Subex face a different reality altogether. The stock market has dropped by a fifth from the end of 2007 and the rupee in recent weeks has hit successive record lows — a costly combination for Indian companies which together face foreign currency convertible bond redemptions this year of nearly $5.5 billion.
"There will be some casualties," said Jacques Berghmans, a Brussels-based India convertibles manager with TreeTop Asset Management, which looks after about 1 billion euros in assets. "Some of the companies are already over-leveraged and they will find it tough raising fresh funding in this market," he said.
Investor fear about the fate of the euro zone is the latest factor to have hit confidence in India, undermining the currency.
But investors have raised a number of India-specific red flags to explain why the rupee is the biggest losing currency this year in Asia among those monitored daily by Reuters, including a swelling current account, heavy government spending particularly on subsidies such as oil, a rash of unpredictable regulations and tax and a coalition that is struggling to push through any reforms to bolster an economy now growing at just above 6 percent.