Sunday, December 11, 2011

INDIAN ECONOMIC GROWTH : GOVERNANCE Vs GLOBAL OPPORTUNITY

The last few years have seen Indian economic growth at 8% plus and the government has been claiming this to be the result of their growth oriented policies and positive economic environment through good governance. How unrealistic and untrue can the government claims be, is borne out by the fact that in spite of policy paralysis, high rates of inflation, Reserve Bank actions to curtail money supply, likely high fiscal deficits, rampant corruption and government inaction in the matter, India will achieve a growth rate of 7% plus
This is only a pointer to the fact that Indian economic growth is a result of global opportunity that beckons the nation. Firstly there is an economic lull in the developed economies because of non viability of growth avenues in industry, financial sector etc. because of lack of requirements and a very high labour cost. These nations have abundant capital, technical competence, know how and engineering backup through which they are securing their future. India has emerged as one of the favourite nations for their investments because of the following:
  • An insatiable demand and requirement for all kind of goods and infrastructural inputs for the next two decades at least.
  • Availability of cheap labour, technical manpower and management resource.
It is imperative that Indian government takes some immediate steps to do some value addition in the fields of infrastructure improvement, providing friendly and favourable environment for investments,coherent policies, sincerity in governance in tackling corruption, graft and black money to achieve a better economic growth rate. The global opportunity is certainly there for the asking but will not be there for all times to come as with passage of time other countries may become more lucrative for investments and technology transfers.Let us not forget that during the last three decades China in spite of being a communist country, and smaller countries like Turkey, Singapore, Taiwan, Malaysia etc.without a very promising human resource were more favoured nations for the developed world.