Reviving India’s Economy
Given the Indian economy’s massive size and extensive global linkages, its growth slowdown is a source of serious concern not just domestically, but around the world. The good news is that carefully crafted policies that address both short- and long -term impediments can reverse the downward trend.
NEW YORK – Not long ago, India was a poster child for political stability and economic growth among emerging economies. Though the country had a long way to go to eradicate poverty and extreme inequality, when it came to steady GDP growth, it was among the world’s strongest and most consistent performers. Not anymore.
In the second quarter of 2017, India’s growth rate fell to 5.7%. It is now tied with Pakistan – behind China, Malaysia, and the Philippines – on the list of major economies for which The Economist provides basic economic data. Neighboring Bangladesh, which is not on that list, is now growing at over 7% per annum (and Bangladesh’s per capita income now exceeds Pakistan’s).
Given the Indian economy’s massive size and extensive global linkages, its growth slowdown is a source of serious concern not just domestically, but around the world. But it is not too late for India to reverse the trend. The key will be carefully crafted policies that address both short- and long-term challenges.
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