Economist India survey
Economist.com
This survey will argue that Indian business can play a big part in delivering faster growth, but only if the government helps. The successes of the past 15 years have been, in a sense, the easy part. Many of the bars that caged the Indian tiger have been removed, leaving the beast free to roam and roar. In particular, India has been able to exploit its great comparative advantage in an era of broadband communications and globalisation: its wealth of technically adept, English-speaking talent. Now, however, further reforms are needed.
First is more liberalisation, continuing the good work of the past 15 years, opening India's markets even wider to competition and reducing the role of the state in the economy. Second is the improvement of India's woeful infrastructure, the biggest bottleneck in the race for growth. Third is a change in India's labour laws, which act as a serious obstacle to labour-intensive manufacturing. Fourth is education, which is not only failing to prepare the rural poor for work off the land, but is also no longer equipping enough talented young graduates with the skills that have fuelled the services boom. Across industry, the same lament is heard: it is hard to find qualified people, and hard to retain them.
The higher rates of growth are essential, however, if India is to find jobs for the 70m or so young people who will join the labour force in the next five years; if the 260m who live on less than $1 a day are to be lifted out of poverty; if the benefits of India's business success are to be shared by the 70% who live in the countryside; and if India, in 15 years' time, is to become something like China today, in its living standards if not in its authoritarianism.
This survey will argue that Indian business can play a big part in delivering faster growth, but only if the government helps. The successes of the past 15 years have been, in a sense, the easy part. Many of the bars that caged the Indian tiger have been removed, leaving the beast free to roam and roar. In particular, India has been able to exploit its great comparative advantage in an era of broadband communications and globalisation: its wealth of technically adept, English-speaking talent. Now, however, further reforms are needed.
First is more liberalisation, continuing the good work of the past 15 years, opening India's markets even wider to competition and reducing the role of the state in the economy. Second is the improvement of India's woeful infrastructure, the biggest bottleneck in the race for growth. Third is a change in India's labour laws, which act as a serious obstacle to labour-intensive manufacturing. Fourth is education, which is not only failing to prepare the rural poor for work off the land, but is also no longer equipping enough talented young graduates with the skills that have fuelled the services boom. Across industry, the same lament is heard: it is hard to find qualified people, and hard to retain them.
The higher rates of growth are essential, however, if India is to find jobs for the 70m or so young people who will join the labour force in the next five years; if the 260m who live on less than $1 a day are to be lifted out of poverty; if the benefits of India's business success are to be shared by the 70% who live in the countryside; and if India, in 15 years' time, is to become something like China today, in its living standards if not in its authoritarianism.
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