The Indian Industrial Production figure for July shows a drop of a whopping 1.9 percent. This clearly indicates that help is needed in the way of an interest rate cut, if things are not to be let to get even worse.
A drop in the White Goods inventory of a massive 37 percent shows the pent-up demand is being satisfied, although the interest rates remain quite high.
Now the challenge will be to continue satisfying that demand, once the inventories are depleted.
An interest rate cut by the Reserve Bank would give industry the support it needs to use the production capacity.
The less-than-generous monsoon rains may mean the crop yields will not be as high as normal, pushing up price of vegetables, lentils and wheat for the Indian consumer and leaving less for export, if any.
In this scenario, the Indian people and their industry need help from a cut in the interest rate, as the new Finance Minister Mr. P. Chidambaram has acknowledged recently.
No-one bar the RainGod can do anything about the monsoon, and it remains to be seen what crop yields are produced. But the Reserve Bank Governor certainly can do something to help the ailing economy. There is no confusing dilemma. Decisive action is now necessary.