In the aftermath of the global financial crisis, optimists hoped that the BRIC (Brazil, Russia, India, China) would drive the global economic engine. But China's economic growth has slowed to its lowest rate in three years. Brazil's economic growth has fallen from around 7.5% to under 3%. Russia's economy is heavily dependent on oil and energy prices. India also has stalled. This three-part paper titled The Great Pretender - India's Economic Past & Future by world-renowned author and financial expert Satyajit Das looks at the development and future trajectory of the "I" in the "BRIC". The first part looked at why India's bad luck may just be beginning.This, the second part, looks at India's current problems…
In late 2011, the Indian government's 12th five-year plan forecast growth of 9% between 2012 and 2017. By early 2012, India's growth had slowed to around 6%, high by the standards of developed countries but well below the levels required to maintain economic momentum and improve the living standards of its citizens.
Elements of the India Shining story remain intact - the demographics of a youthful population, the large domestic demand base and the high savings rate.
Increasingly, India's problems - poor public finances, weak international position, structurally flawed businesses, poor infrastructure, corruption and political atrophy - threaten to overwhelm its future prospects.
Image: Activists from the Samajwadi Abhiyan (Socialist campaign) protest against Congress Party President Sonia Gandhi and Congress-led UPA government during a demonstration in this 2006 file photo.
Copyright: 2012 Satyajit Das All Rights Reserved.
Images Courtesy: AFP/AP/Reuters/PTI