BY Fraser Tennant
India is a sleeping economic powerhouse which should rank among the world’s strongest economies, according to a report published this week by Deloitte.
The report – ‘Competitiveness: Catching the next wave’ – portrays India as a country possessing the basis for great economic strength, such as stable democratic rule, a global outlook, a young demographic base, growing incomes, and an increasingly educated workforce.
But, on the downside, the report makes abundantly clear that the assertion that India is, or should be, a major global economic player is largely theoretical.
Decades of chronic infrastructure paralysis and indecisive political decision-making have resulted in a country which, in automotive terms, is driving with the handbrake very much on.
Despite this, according to report co-author, Gary Coleman, a managing director at Deloitte Global, India is on the cusp of a startling revival. He said: “India is a large market with rising purchasing power, a strategic location with links to fast-growing economic regions, and a young population eager to take part in the nation’s development.
“Recent policy moves such as the Reserve Bank of India’s shift to an inflation-targeting framework, along with the new government’s focus on fiscal consolidation, have helped improve business sentiment.
“Another positive indicator is the government’s initiatives to upgrade ties with major economies, ease decision making, develop infrastructure, and promote manufacturing.
“However, it’s still a long road ahead. Change is never easy, but the government can draw comfort from the economy’s inherent strengths. They will serve as a solid base from which policymakers can steer India’s economic ship to catch the next wave of growth and prosperity.”
Deloitte’s report certainly paints a picture of a sleeping economic giant, just waiting for the right time to stir from its slumber. Whether the stimulus for the awakening will prove to be of domestic or international origin remains to be seen, but what is clear is that India is poised to take its place among the global economic elite.