Mumbai terror strike, global economy and more...

This has been an year not to remember so far - not from a personal view point, but from what's transpiring globally.

What started off as a weak year with clear hints of a slowing global economy is winding down as one of the worst ever years in a life time (I sincerely hope this is the case!). The sub-prime lending fallout in US drastically led the global economy to a grinding halt - strung by a global credit crunch, gargantuan write-offs at financial firms, massive lay-offs, depressed consumer sentiment, a drastic fall in consumer spending and almost surely a global recessionary scenario...Japan, China, the US (by 4th quarter, even by technical definition) and many to come in the Euro region. What started off in the US has probably to be fixed here too - with firm central/federal steps, be it demand side or supply side! In the current scenario, it probably takes some strong demand-side measures by the new government post Jan 2009 (similar to the 30's when government-led infrastructure spending helped escape the rut)...there has been enough supply-side measures without much avail. Though quite uncommon in the free-market era, we would probably/surely see a strong switch to central regulation and state-led measures to pump-prime the economy back in to shape, but in a measured manner. The industry has little option, but to comply...but every one sincerely hopes this doesn't throw us back to a pre-free market state regime!

We didn't need anything more to spread further gloom to the year - but the terror attack which unreeled in Mumbai on Nov 26 did exactly the same. Its suprising to see 7-8 terror attacks in India over the course of 12 months (almost surely unprecedented due to nature of the attacks) pass by without any firm counter-steps. 9/11 in the US was replied by a strong counter-lash - though the direction and intent of the measures ever since then might be debatable, the nature and tone of the response delivered an equivocal message. Nov 26 probably delivers a repeated warning without any doubt...the world cannot sit and wait for more attacks to respond. India (and the world) needs a very pro-active and firm approach to tackle terrorism - we probably need a multi-pronged approach involving political means, economic means, advanced global warning systems and last but not least brute force! The right approach has to a) identify the funding means of terrorist groups and stifle funding sources (we can do this at least partly by strongly promoting green energy for what you know!) b) orchestrate political and diplomatic forces globally to isolate and target such forces and c) enforce counter-terrorism measures with complete conviction and force. This again calls for an approach which is unique to the times, driven centrally, but towards the right direction.