In India, the share of stock market investment out of the family savings is only 1.2%. By 2011, it won`t go beyond 2.2%. It means that our approach is still family-oriented in spite of modernity as an elite social value. Since 2 or 3 months, you can read in the newspapers about de-coupling. If we can de-couple from the US economy, it can only be through cultural fault-lines, not institutional or legal fault-lines.
Who says that we can de-couple? Mr Chidambaram?
I don`t think (Mr) Chidambaram has the time to think of all this. He thinks we are de-coupled from the global crisis because we are not making subprime loans. We may not be doing, but how come ICICI has provided for Rs 1,200 crores in its balance-sheet.
So not making sub-prime loans in India does not guarantee de-coupling. Our culture model is decouples, not government policies on economics, which largely imports the Anglo-Saxon principles. If 25% of the Indian were to get linked to the stock market, could we be de-coupled from the global crisis? Not at all.
Some time risk taking in stock market is mistaken as entrepreneurial model. It is not because you are taking less risk in the stock market that you are less entrepreneurial. The GEM (Global Entrepreneur Monitor) Study for 2001 has shown that, among US, China and India, India leads in entrepreneurship with 18% of persons between the age of 18 and 64 classified as entrepreneurs (while it is 11% in China and 10% in the US).
Indians, when they are in business, take risks, but their personal family savings are in safe modes. This is because Indian families take care of their responsibilities without being state- dependent. That is the strength of these societies, because the burden on the Government is less. The US`s capacity to come out of the present crisis is hampered because the State has weakened the family structure during last 3 or 4 decades.
Image Caption:The Bombay Stock Exchange. In India, the share of stock market investment out of the family savings is only 1.2%.
Image: AP. Any unauthorised reproduction is strictly prohibited
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