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TOP OF THE WORLD
Economists may scream GLOBAL RECESSION, but India is one of the
strongest economies in the world today!
The world's strongest economy, the United States, sank into recession
after 10 years of growth, which was the longest expansion on record
since the end of the II World War. The global scenario has never
been so depressed. Not since the crash of '29. IMF-World Bank forecasts
say the US, EU and Japan may trigger a crash in world trade growth
from 1.3% in 2000 to just 1% in 2001. Amid such devastation, even
as some East Asian economies go into negative growth, India may
end 2001 with 4.5%. That catapults us to the top slot, after China.
And what's more, while China slows down from 7.5 to 7.1, India actually
improves to 5.7.
Of 31 countries with a population of above 20 million, India had
the fourth highest growth of GDP in purchasing power parity, after
China, Korea and Thailand.
Is there a hidden resilience in the Indian economy?
Yashwant Sinha seems to think so. While exports drive the Big Three
- US, Japan and Germany - agriculture drives the Indian economy.
Much of the purchasing power comes from agriculture and allied activities.
70% of the people form the backbone of that power.
Apart from agriculture, the main contributor to India's stability
is its policy of not allowing foreign investors to enter volatile
areas such as real estate.
Says the latest IMF World Economic Outlook: 'India is relatively
insulated from the global slowdown, given the nature of its IT sector
(which is focused on services, where India remains highly cost-competitive)
and its relatively closed economy'.
So can we turn on the music? No. The government may try
to get maximum mileage out of this, but the fact remains, we under-utilize
our potential. If we achieved half the potential, around 7.5%, we
could become the fastest growing country by 2010.
Source: Outlook
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