The GDP growth of 7.7% is fairly strong. Do you think it makes the case for another rate hike by the RBI and when do you see the RBI beginning to cut interest rates? Yes, the headline at 7.7% clearly is a positive. We were expecting slightly lower than that. And to that extent, given that inflation also continues to be on the higher side, given the strong tenor of the message which came from RBI right from the May 3rd policy onwards, it does look like the RBI will continue with the rate hike of 25 bps in the next credit review. Then one has to wait and see how things pan out. However, one must also keep in mind that while the headline inflation per se is reasonably strong at 7.7%, it also tends to mask some real weaknesses. We have seen the construction headline at pretty low at 1.2%, we also think the private consumption number is a cause of worry, at a low 6% kind of growth number. We have not seen these kinds of low numbers except during the real crisis 2008-2009 period, a few years back. So that we think is a sign of worry. Overall, given the tenor of the RBI policies over the last three reviews we think a rate hike is likely. Having said that, we think given that interest rate sensitive sectors are already reeling given that the credit offtake has come down, possibly there is a growing argument for a pause at some stage. What is your sense on government borrowing? You continue to see higher borrowing this fiscal and how much higher can we go from the budgeted target according to you? Look, the 4.6% fiscal deficit target set by the government has been questioned by a lot of research houses and in fact even the RBI has cast a bit of doubt about those numbers. We think the number could be closer to 5.6% which actually brings in a bit of a paradox. One if you have the rate hike cycle peaking out at some stage and may be even rate cuts the next year, there is a case for rates to come down. However, specifically for the government sector, we could see more supply than anticipated coming through pushing yields up. On balance, though we think we are currently at 8.3% on the 10 year, we do not think it should go beyond 8.5%. The incremental credit deposit ratios have really dropped. We think banks have cash now to invest in government securities as do insurance companies and investment houses. So, overall we think they should head lower despite the possibility of an increase in the borrowing programme.

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