GDP Growth rate in the world between 1990 to 2007
” Indian Economy is now clearly on a recovery path with a 7.4 per cent growth in the first three quarters and the new government is committed to maintain overall macroeconomic conditions on a sustained basis,”Indian Finance Minister Arun Jaitely said.
With aims of restraining inflation to around 4 % for the next three years, and a reduction in India’s current account deficit (CAD) which, declined sharply from 4.8 per cent of GDP in 2012-13 to 1.7 per cent in 2013-14 and is expected to decline further to 1.3 per cent in 2014-15. We need rapid disinvestment, as without it the investment in the future for Smart Cities, Industrial corridors along Railroads and National Highways is not possible. We need to bring industrial manufacturing to the rural areas to provide employment, and for that the state must pass the land bill.
With millions of employable people mushrooming from these rural areas in the coming decades, the states must provide great employment opportunities, by allowing private entrepreneurial ‘Make in India’ initiatives. With Mudra and the financial inclusion of hundreds of electronic millions into the economy, with micro financing, and direct deposit of social benefits; a new social good, is being achieved. There is an opportunity to tie in health and social security into the fastest digitization of Bank Accounts for hundreds of unbanked millions. With 300 million people landless in the rural sectors, these corridors will provide the employment; for these poor and deprived unemployed, in the countryside. Without these new employment opportunities they will end up and be treated as migrant labor, so it is best to bring jobs and skills to them, rather than cause a mass exodus.
Urbanization is not the only solution for modern living, but at the same time the rural land has to be converted; into these new industrial, and modern hubs. The more investment from a current account surplus, through widespread disinvestment; in the public sector, is required to boost the economy. Investment in infrastructure can only come from the state, if it generates a surplus, for the advancement of its people. Modi and Jaitely have been at major International nations recently in a display of Indian thinking today. They have pledged their intent to improve the economy with concentrated effort to make it simpler, economical and faster to Make in India. The government is open to business and will be an enabler instead of a procrastinator and a better rating is the result.
Mr. Modi has just concluded the best long term deal for Green energy by going nuclear for a billion people. With long term uranium commitments from Canada India can plan to provide electricity down its corridors in a reliable manner by including, hydro, solar, wind and biogas into the mix. The challenges are uniquely Indian as Mahatma Gandhi had pointed out that India lives in its ½ million villages. Unless we provide income, sanitation, irrigation and power to these villages from green projects India will become dependent on its abundant coal resources which it is starting to unleash. Coal will still be a mainstay of India’s immediate energy needs, but it is a cause of pollution and global warming.
Modi and Jaitely are both promising the new normalization of foreign and domestic investments, into GDP rate of annual growth of double digits, for decades in India’s future. The number is not plausible right now, but just the thought process is different; from ex Finance Minister Mr. Manmohan Singh’s under Narasimha Rao PM opening in 1991. They had struggled with a balance of payments crisis and a growth of 5% and more had looked good from their perspective, after the anemic Hindu rate of growth since Independence. A rate of 5-7% today, will not be enough for providing the jobs and growth required. The demographic dividend from South Asia is an opportunity for India to provide leadership, skill sets, and employment, by rapidly increasing manufacturing and energy. Qatari LPG and Iranian Oil can supply India for most of its immediate needs. Long term contracts with strategic pipelines should be built for these supplies and the infrastructure to build for transportation, refining and distribution of petroleum energy. India has the technology that south Asia needs, in one of the greatest growth stories that is about to unfold; as the next middle class of millions emerge, similar to China’s growth in the past decades.
A lot of things need to administratively, legislatively and judicially come together for India to attain its true potential. So far it has been just the start with the first year of the new economic thinking and a lot of work still remains to be done. Given time it should yield rich rewards, if the new leaders can keep their promises. While the euphoria of the BJP victory and Modi wave, may be subsiding, it is now up to these leaders, to forge a new reality; by simplifying and allowing into action the work of a million entrepreneurs. The time has come for the rise of a new India to seek its destiny, as the fastest growing nation on the planet. After a long time we have the visionaries who can take India in a new direction. Having forsaken my citizenship, I never thought that I would ever say again, that I am proud to see articulate Indian leaders, showing fearless leadership on the world stage.