How strong is India’s economy? – 2024-04-29 07:19:17

Lok Sabha elections are going on in India. The second phase of polling has already ended. This polling process will end in the seventh phase. It is expected that the current Prime Minister Narendra Modi will win for the third time.

As a result, he will get the status of popular leader after Nehru. The electoral success of this tea-seller’s son largely reflects his political skill, the strength of Hindu-nationalist ideology and the erosion of democratic institutions. But it will also reflect a perception among the general electorate and the elite, that he is bringing India to a position of prosperity and strength.

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Modi’s India can be a test case of how to get rich under globalization and strongman leadership. The fate of 1.4 billion people and the global economy will depend on rapid growth and avoiding instability in the next 10 to 20 years. But there are questions about whether India’s success will be permanent or whether it depends on Modi staying in power.

India is the fastest growing country in the world, growing at a rate of six to seven percent annually. Private sector confidence is currently at its highest level since 2020, according to new data released. Moreover, India is currently the fifth largest economy. It is said that it will become the third economy country by 2027.

US companies have about 1.5 million workers in India, more than any other country. The country’s stock market value is also fourth in the world. The country ranks third in the aviation market. Growing the economy means moving to a stronger position geopolitically.

India has deployed at least 10 warships in the Middle East after the Houthi offensive began in the Persian Gulf.

But India will not be next to China in terms of production. Because India is developing at a time when commodity trade and factory automation are stagnating. So a new model is needed for growth. The important pillar in this regard is infrastructure development. India currently has 149 airports, double what it was a decade ago. The country is adding 10,000 km of roads and 15 GW of solar energy capacity annually.

India has some infrastructure that is not visible. These include, digital payments, modern capital markets and banks, digital tax system.

The second important pillar is service exports, which have already reached 10 percent of GDP. Millions of poor Indians are getting banking benefits in the new welfare system. The poverty rate in the country has come down from 12 percent in 2011 to 5 percent.

But despite all this, India has a big problem. That is unemployment. A large part of the country’s working population is unemployed. Consequently, to sustain growth, India must create employment.

Source: The Economist

MSM