By Pankaj Adhikari
With the Indian rupee over the past few months continuing its losing streak against the dollar, and foreign investors leaving Indian shores, sentiments about the Indian economy are gloomy and bleak.
A world renowned economist, our Prime Minister Manmohan Singh, has taken over the finance portfolio. There is no reason whatsoever to see the writing on the wall.
India will shine again.
To ensure India’s economic growth rate, we need to strengthen our manufacturing sector. India has immense labor capacity. We talk about our knowledge sector, but a large portion of the Indian populace cannot take part in the knowledge sector as they can hardly afford to do so. For many, getting a quality education is a distant dream.
Manufacturing, therefore, can play a key role in economic rejuvenation.
In India, the states that have focused on the manufacturing sector have registered double-digit GDP. The states that have laid emphasis on manufacturing are making rapid progress. Look at Gujarat, for example. According to the Ministry of Statistics, India’s national GDP per capita for 2011-2012 is $1,470, while Gujarat’s is $2,203. In 2010, Forbes’ list of the world’s fastest growing cities included Ahmedabad (a city in Gujarat), ranked third after Chengdu and Chongqing in China. In a July 2011 report, The Economist noted that Gujarat’s infrastructure competes with Guangdong, the economic engine of China. With double digit growth rates, Gujarat continues to outpace growth in other Indian states.
India’s much-touted IT industry may not be sustainable in the long term. Many of the IT firms have failed to innovate their business models. And India needs investments to shore up its appalling infrastructure.
In 2005, Prime Minister Singh said, “The 21st century will be an Indian century”. He expressed hope that “the world will look at us with regard and respect, not just for the economic progress we make but for the democratic values we cherish and uphold and the principles of pluralism and inclusiveness we have come to represent which is India’s heritage as a centuries old culture and civilization.”
Although Singh’s public image has taken a beating of late, allegedly because of some of the biggest corruption scandals in recent history, he is still thought of as a man of clean background. In 2010, Newsweek described him as “the leader other leaders love.” The article quoted Mohamed ElBaradei, former director of the International Atomic Energy Agency, who said that Singh is, “the model of what a political leader should be”. Forbes described Singh as being “universally praised as India’s best prime minister since Nehru.”
Manmohanomics — with its emphasis on affirmative action, workers’ benefits, honesty, transparency in business and environment-friendly investments — can produce miracles.
Watch out skeptics, India’s rising story isn’t over yet.