Debt restructuring the only option for EU

The EU is planning to top up its rescue fund and improve the quality of funding by way of reassuring the markets. These are cosmetics. They just won't work. The EU has to act collectively to get investors (creditors) to restructure. Either that or you will have serial defaults down the road.

Sovereign default is regarded as taboo, as something that countries must avoid at all costs. But countries that have defaulted haven't done badly at all. More on this in in ET column, Who says it doesn't pay to default?

Forecast for India in 2011

Growth will match or exceed 8.5-9% projected in 2010; the EU will hold together despite crises, so we need not fear disruption of financial flows; inflation rate will stay high, perhaps 7-8%; the UPA government will survive and very little of the mud flung at it on account of 2 G sales will stick.

More in ET column, What lies in store for India in 2011?