In a recent essay in Foreign Affairs, economist Arvind Subramanian and former International Monetary Fund (IMF) representative in India argue that India’s rise is stalling due to various reasons from protectionist economic policies to social friction.
But there is reason to argue that India is in fact on a difficult path of resolving the many complicated problems that have in the past stopped the world’s largest democracy. The process of this resolution is not, and won’t be, easy. It is forcing the country to face up to issues that it has long preferred to ignore, sweep under the carpet — from eradicating regulatory chokes to building a strong national manufacturing base.
The country has moved from ninth position to fifth place in terms of size of GDP (gross domestic product) between 2010 and 2021. All estimates suggest that it will be among the three largest economies by the end of the decade.
Its recovery from the COVID-19 pandemic gives a sense of the direction that India is following — India’s merchandise exports grew by 27.5 percent between 2019 and 2020 (August to August) and jumped more than 45 percent the following year. In 2020, India was the fifth-biggest recipient of foreign direct investment (FDI) in the world.
In the first quarter of 2020, the country had 22 IPOs (initial public offering) mopping up $2.5 billion — a rise of more than 80 percent. It has the world’s third biggest start-up ecosystem with 63 unicorns (start-ups valued at $1 billion or more).
The time taken to deliver 100 million vaccine doses in India has fallen from around 85 days to 13 days, and nearly a hundred countries have received vaccines that were manufactured in India. In January 2020, India had only one laboratory that could test for COVID-19, barely a year-and-a-half later, it had nearly 3,000. From barely having a place for manufacturing PPE kits at the start of the pandemic, it has become the world’s second largest producer of such outfits.
It is the world’s biggest destination for outsourcing information technology-related services. It is the world’s second-largest producer of silk, steel, and mobile phones. It ranks at number three both in military spending and size of its financial technology industry.
In 2020, India had the biggest number of digital transactions of money — ahead of both the United States and China. It has created, in the last five years, a world-beating fin tech architecture.
India has 140 million online shoppers, the third biggest in the world. With a historic tax cut and constant reductions in the compliance burden, efforts to simplify the process of doing business in the country are bearing fruit.
After India removed special provisions applicable to the Islamist-militancy afflicted state of Jammu and Kashmir, for the first time in three decades, a 125-year-old church, St Luke’s Church, is celebrating Christmas, with carol singing and a Christmas tree. In Banaras, one of the holiest places for Hindus, the ancient Kashi Vishwanath temple has finally been freed from decades of land grab and encroachment, and in Meerut, Hindu artisans are refurbishing the Shahi Jama Masjid, the oldest mosque in the city.
Security challenges abound, not just from Chinese threats, but also a rise in militancy in Kashmir after the exit of the United States from Afghanistan. Global warming is adding a new edge to these threats — especially with the crisis of water in China casting a shadow on the stability of water supplies across Asia.
The Omicron version of the COVID virus complicates matters — as it does everywhere in the world — but India’s growth trajectory is unlikely to be seriously disturbed. The country is spending more on building infrastructure than ever before in its history.
All this does not add to an India whose rise is stalled. It adds up to an India which is more convinced of its rise but is also more cautious — the roll-back of the farm reforms recently were triggered most likely by growing reports of them being used to fuel militancy in the agrarian state of Punjab.
This caution is necessary as the next five years are critical for India to resolve its toughest internal questions and complete the task of building the base for its rise. These are also going to be the years when it would face the greatest internal and external problems to stall its rise.
But the signs suggest that India and Indians are increasingly ready for this.
The writer is a multiple award-winning historian and author. The views expressed are personal.
from Firstpost India Latest News https://ift.tt/3mzfIDo
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