Think local, Mr Modi

Narendra Modi will have empty coffers greeting him. If pollsters' predictions come true and the opposition politician becomes India's prime minister next month, he will have to contend with a grim fiscal situation. Total public expenditure is growing at a pace of 15 per cent annually, faster than the expansion in the nominal economy. Meanwhile, tax collections have increased only 10 per cent in the first 11 months of the fiscal year that ended in March. Mr Modi might be tempted to hit the brakes on spending.

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