Given India’s ranking as the 12th largest economy in the world, there is much speculation since 2002 of what Indian economy would be at the dawn of two decade mark of the 21st century. It began with the planning commission under the chairmanship of S.P.Gupta submitting the report on ”India Vision 2020” and ever since some have speculated that by 2020 India will be the third largest economy, or the fifth largest or perhaps even a developed nation!
Indian economy undeniably is one of the emerging ones but much dynamic in nature. India faced minimal shocks of the recession in 2008 in the form of contracted exports, the rupee depreciating to a whopping ?57, unemployment soaring (IT sector especially cutting jobs) and Sensex falling by almost 13% which was because of investors finding their money contracted and faith shattering in the stock markets and preferred saving more.
Investment has been very fickle due to internal economic and political environment. The standard and poor’s rating for India’s credibility was given to be BBB- in 2012. If politically it becomes controversial to welcome FDI in the economy and if any such policy changes stirs the entire nation then investors hesitate to Invest and it is no doubt that Investment is one of the major growth drivers if India were to achieve its 2020 targets.
Moreover, what remains to be crucial criteria over and above GDP or per capita is the Human Development Index (HDI) recognized by the United Nations. Currently out of 187 countries India ranks at 134th with the HDI value of 0.547, which is below average global value of 0.682.
Seven years down the lane from now, I am very skeptical of India even promoting to becoming 5th largest economy, globally. As an economy what it requires is more accountability and reduced corruption in the political system as it affects the investor faith in the economy. There is no doubt that over the coming years, India’s population would be very close to China’s which reflects higher demand for commodities. It becomes a necessary step for India to choose the path of sustainable development. For prices of fuel and energy resources will drastically increase hampering the development.
Undoubtedly, the service sector will prosper the most. On the other hand, if the agricultural sector is not taken care off by means of smooth credit facility and greater technological reach for the farmers then, India will end up struggling as a developing country. A developed nation is recognized not only by high GDP but also its standard of living and technological transformation where the service sector contributes the maximum to national income.
In 2020, India is predicted to have much reduced poverty from existing 30%, HDI improving overall with increasing GDP however, what I fear is growing disparity. Only, if the political system improves with greater reforms and capitalizing on renewable resources and sustainable development can India’s growth be kept less shaky and intact.
About the Author
Arushi describes herself as fun loving, zealous, foodie, sharp humored and an extrovert, who loves to travel, read much and dance a lot. She is always curiosity stricken and thus always look out for avenues to learn. Her field of interest is Economics and aspires to be a researcher cum analyst. She keep things organized and sorted and most of the time you will see her running things ‘on schedule’. She has mastered the skill of multitasking since she has this knack to do ‘everything’! and she lives by the motto, that there isn’t anything that you can’t do, until you initiate.