indian economy a view
TRANSCRIPT
Indian Economy – A View
Amartya Sen, Nobelist
“The frustrating thing about India is that whatever you can rightfully say about India, the opposite is also true.”
Simon Kuznets used to say there were four kinds of countries; developed, developing, Japan and Argentina
Today there also are four kinds; developed, developing, China and India.
President Obama
“India is not emerging; India has emerged”.
India – Study in Contradiction
In India we are like that - Growth Growing fast. Greater than 8 %
growth in last few years. Avoided the recession GDP > US $ 1 trillion, PPP based >
US $ 3.5 trillion. 4th largest in a list of 180
Uneven growth – HDI rank 134th out of 187, Gini ratio rank 55th out of 136. Gender Gap rank 113th out of 136
India – Imbalanced GDP Composition
Sector GDP Share % Employment Share %
Agriculture 17 50
Industry 29 20
Services 54 30
Total 100 100
In India we are like that – Growth: Pros Self sufficiency and more in agriculture.
Demolished demons of ‘Limits to Growth’. Stagnation in recent years.
Impressive industry growth. Oil, Steel, Mining, Pharmaceutical, energy and Auto. Bio-technology, Space, Armament.
Services – Rapid growth in banking, retail, insurance, education. IT and ITES, Tradition and capability of research and development
In India we are like that – Growth: Pros Democracy, Individual Freedom,
Transparency, Vibrant and active media
Active and generally honest judiciary Politically savvy illiterates, Federalism Large and growing middle class Mature capital markets, banking
sector and flow of foreign institutional investment.
In India we are like that – Growth: Pros Amazing diversity – geographical,
economic, social, political, cultural. 325 languages spoken – 1,652 325 languages spoken – 1,652 dialects, 18 official languagesdialects, 18 official languages
ccoexistence of modernity and an anti-modernity
Demography – A Boon or a bane?
In India we are like that – Growth: Demographic Dividend
Young India, 50% less than 25 years of which 30 % less than 16
The billion people challenge; 1.2 billion now, 1.48 in 2030, 1.6 in 2050.
Plummeting birth rates, death rates. High infant mortality rate
Addition to working age population in next two decades. Africa 340 million, India 213 million, US 14 million, Japan (11) million, China (45) million, Europe (54) million.million.
China and India – Demographic Structures
In India we are like that – Growth: Cons
Disproportionate concentration of employment in agriculture.
Running to catch up in infrastructure Rapid urbanization and Urban decay.
62 % rural, 38 % urban Inadequate and improper
governance – corruprion. Govt. policy paralysis, policy confusion, populism.
In India we are like that – Growth: Cons
Erratic reforms ‘China is a closed country with open mind, India, open with closed mind’ (Setback in policy on FDI in retail)
Victim of cross-border terrorism Rising expectations, social unrest Maoism
In India we are like that – Growth: Cons
Inflation Political divide puts pressure on
federalism. Uneven income, opportunity Regional disparity Black money – economics and
politics of it
Triple Threats
Relationship with Pakistan and China
Political chaos Global economic instability