Farmers, Food, Training, Subsidies, Borrowing Cost, Gold, Hedge Investment, CAD, Exchange Rate...

The subsidy for fertilizers should be changed for buying cattle and fodder which could be a long term solution for productivity of the soil, they would reproduce... cow dung for manure, they would give milk, too, to supplement farm incomes... Cattle breeding should be promoted...

The problem is more with the higher prices in other sectors which has flourished on cheap food prices and lowering borrowing cost, at the cost of farm incomes, which has depressed real incomes and share in the agriculture... The question is who will invest in a overegulated market where the government is the chief buyer which then distributes it itself... It is in the interest of the farmers to sell directly to the buyers through farmers unions or cartels... why the oil is dear and food is cheap... because the government is unable to control too much high supply which could be adjusted to keep prices high or more volatile to accommodate farm incomes when demand is too high... farmers are not benefited by higher demand, though... Farmers union should be obilized to bargain in the market to the suppliers... not to the government...

At their cost...

Food should be tax free... it is directly related to health... do not tax health... 

Lower farm share in the national income... points to an overegulated market, but inflation goes out... free market to export at higher prices and import at lower prices... 

On the job training... do your own (work) ? Subsidize skills and training...

Jobs are important... to lower unemployment... increase growth efficiency... the effective growth... 

A lot of subsidies are given to the political power... what 'bout that...? 

The Monetary Policy should target lower inflation by lowering the borrowing cost or nominal interest rate and higher real interest rate and savings... Other things remaining constant lower capital cost would increase productivity and competitiveness... lowering the price level... it would (also) increase supply to lower inflation... 

When businesses could earn higher in safe bank deposits... they would not invest... 

Who will take risk?

Probably, the real effective exchange rate (REER) for rupee and dollar is 21.33 rupees...

Because,

REER = the ratio of domestic and foreign exchange rate / the ratio of domestic and the foreign inflation or price level...

therefore,

nominal exchange rate INDIA-US is 64/1 or 64 : 1
inflation in INDIA is 6%,
in the US is 2%

again, therefore,

we have 64/3 after simplification,

and, on further simplification it comes at

21. 33...

The nominal value converges to the real effective value in the future, because of inflation, nominal inflation would converge between countries too... 

It .(gold). is because it increases CAD during slowdown... it is has had been considered a safe heaven investment during recessions and low demand... Nonetheless, there are gold bonds which give higher inflation adjusted returns... One could invest in literally anything which is going through a lower price period and has expectations of higher price expectations in the future if you hold the stock... 

Investment hedging or investment insurance could (true) reduce risks for the RBI and other banks... Would reduce NPAs in the future... 

Exchange rate adjustments could also be achieved by higher real effective wages and higher real effective interest rates, higher consumption, higher savings, lower nominal interest rate and higher investment), due to lower domestic price level through increase in productivity and competitiveness. (Internal Devaluation). Real wages and domestic demand should be contained or increased, and at the same time real exchange rate could increase export demand...