Outlook Business (OB): Will the next one year be determined by domestic factors?

Hansraj: I have always held the view, in all these years in the capital market, that from an India perspective, we need to keep one eye on crude, because that plays a key role in determining which way we are headed. 

OB: So, the macro for us is primarily spoiled by oil.

Hansraj: Exactly. Let’s face it — crude has a significant bearing on both our CAD and fiscal deficit, and I am not even getting into the argument that electronics import has become the next big item. Also, the general belief in India is that the rupee will depreciate 3-4% per annum, that is, at the difference in inflation rate between the two countries. There is nothing wrong with 65 going down to 75 over five years, which is effectively a 3-3.5% per annum depreciation. But the fact that the fall has happened suddenly, in a short span of time, is unnerving. Also, we seem to be in for a high interest rate regime, because if the view is that the US is going to hike rates (quarter percentage) three to four times between now and December 2019, then you could look at the 10-year US yield at 4%, which means we are looking at 10-year Indian gilt at 8.5%...

Kapoor: I jus