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Party time for India in Davos.....but hold on a minute.


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January 26, 2007

Party time for India in Davos.....but hold on a minute.

Steve Hamm

Once again, the world's business and political thought leaders have gathered in the Swiss resort town of Davos, and, once again, India is being toasted and is toasting itself. I'm watching from afar, in NYC, but avidly reading the coverage in news stories and blogs. My strongest impression is that there is a lot of happy talk about India and its prospects, which is appropriate, but not much talk about its challenges. People seem to be papering over the country's infrastructure deficit, which, by some measures, is slowing GDP growth by 2%. And, coupled with that is the problem of the haves and the have nots. The vast majority of Indians have been left behind as the tech economy takes off. And they vote. Signs of trouble are already showing up. Pro-business and pro-reform politicians are being defeated at the polls, replaced by people who promise voters free TV sets, free water, and free electricity. Wrapped together, the infrastructure problem and the country's unruly politics constitute a serious challenge to India's aspirations to become one of the world's top economies. So, sure, Indians should party at Davos. But unless they make huge amounts of progress back home, the hangover could be quite painful.

08:31 AM

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I hate to say this, I mean you seem genuinely interested in India and all, but you seem extremely naive. And I mean just look at your previous posts, you seem to be full of enthusiasm but unable to place things in context.

We have just started on the path to reform. A lot of people still do not know what reforms quantitatively mean to them.

Populist winning polls is not a new story. It is the rule in India.

Watch the trend that bucks the rule. That is more important and it will more revealing to you.

Posted by: Robin at January 28, 2007 09:31 AM

Progress of the social sector is real progress of a country.Economic growth can be achieved without achieving anything for the society.Quality health care,education,water,power,transport need tremendous improvement.Almost absent judiciary and the police politician nexus create insecurity in people.Corruption plays a significant role in decision making,thereby hijacking decisions to benefit vested interests.Quality employment based on skills is very scarce,most of the youth are employed as security guards,drivers etc.Elections are still counterproductive to the society,because of the captive vote bank politics.The choice is from one corrupt and ineffective party to another corrupt and ineffective party.Between the devil and the deep sea,there is not much choice.But it is not to be blamed entirely on politicians.The Indian educated middle-class is too lazy,easy-going arrogant and irresponsible.They do not have the sense of responsibility to the society.They vehemently deny that society is not their responsibilty.Then whose responsibilty it is.When politicians volunteer to social work,they will do according to their character only.Why do you relegate the Nations duties to unscrupulous people?The poor and the lower class people do not understand anything about running the country and responsibilities to the society.Only the educated people have to take the lead.First they have to utilise the independent institutions to redress the problems of the society.If they are inadequate,demand for giving more power and for more effective institutions.One election commission,one TRAI and a few PILs in Supreme Court are not enough.

Posted by: Krishnamurthy Narayanan at February 1, 2007 08:17 AM

Most of the rural India depends on agriculture for their livelihood, but the economic growth is mainly led by services sector, that's why vast majority were left off in the initial phase of this India growth story. However, with the kind of retail revolution that is happening now by initiatives like ITC - echoupal, Reliance Fresh, etc - not only empowers the farmers with knowledge but also helps them get better prices for their products. This will definitely reduce the bridge between haves and have nots and will usher in rural prosperity too.

Posted by: Siva Rajendran at February 7, 2007 09:57 AM

India definitely has potential but it need to get pro development and futuristic politicians and bureaucrats. What we have today are still living in world 40 years back.

Population, Basic Resources(Water, Food, Shelter), Quality education, Infrastructure, Electricity are biggest challenges and future problems.

Everyones talking of so called development and future and blah blah.

No country can call itself developed nation if still in post december months half of population struggles to get potable water, struggles to eat healthily both times, educate children and most important have quality living standards.

Just few percentage of population moving ahead isnt progress, every one having access to mobile phones, computers, internet isnt progress.

Progress is quality of life, and we in India still has much more to achieve to get ourself qualified as developed nation.

We have every potential and Youth power with help of elders experience will make it happen for sure.

Posted by: vijay kurhade at February 10, 2007 05:46 PM

Forget the polls: the divisions are so deep that swathes of angry people want to overturn the state itself. Armed miltancy,inter-group hatred, extreme levels of corruption and exploding population are some issues which you cannot measure by economic parameters, you can only feel them swamping you everywhere.

Ecocnomics is secondary to humanity and if human values are absent, what good is economics? Better to be an economic weakling Bhutan- 8th happiest country- than a chaotic India where no matter how good you do moneywise, life keeps clawing at you.

The government of the day does not command any respect, and that cannot be achieved by any GDP growth. In fact it has messed up the country so thoroughly that it will take atleast 50 years for people to have a genuine feel-good factor.

My feeling is that both will hold good economic growth and social/environmental/moral degradation will go on together in India. I dont expect any collapse, though. Its for you which part you choose to look at and live by.

Posted by: abhishek at March 20, 2007 04:53 PM

Steve,

u are absolutely spot on with your analysis. The current success of "India" is it's middle class, and specifically those in the service sector. Long term - this needs to change to include atleast another 200 million getting close to where the present 200 million are - and in sectors like manufacturing or agriculture with focus on increasing output/productivity efficiently. This itself will create millions of opportunities to "support industries" which will need to cater to the needs of this number. Unless there is drastic and disciplined outlay in infrastructure and manufacturing - I do not see any significant gains except a lot of frustration growing at the lowest rungs (who are still completely and shamelessly exploited). Spending by the government has to be based on trust in a stable environment and not diverted to build and maintain a military that is a big drain on resources and on armaments that "showoff" the country but invites mocking comments by the developed world when the country still has so much of poverty!!

Posted by: cheech at March 31, 2007 11:51 PM

The biggest problem that my beloved India are

1. Corrupted political system

2. Poor education ( I know u don't belive this)

3. Religion ( Did i say it outloud)

4. Limited R&D

5. Pathetic Infrastructure

But why the foriegners like to hail INDIA, this is due to a Billion Plus population. a Huge duming ground for their products, cheap & efficinet labor. By the way Bollywood & Bangalore is not India. A Long way to Go. No Party time yet.

Posted by: mrv at April 4, 2007 12:38 PM


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