I am reading all the doomsday stories about our economy. The growth has dropped to below 6%. Its the lowest in the past decade and all the allied stuff. I will warn you guys that I am not a economist by any stretch of imagination but then it gives me a detached perspective of analyzing the economy and all the news associated with it.
First for the last decade we have had the second fastest growing economy in the world and thats quite an achievement as I am made to believe. But what does it mean to you and me? To me things commodities are expensive, inspite of me getting a good salary I end up spending almost all of it just to live a decent life. And I wonder what happens to the people who earn significantly lower than me. In India we often refer to everyone who is educated and working as the middle class but is it so in reality? And as a percentage of population the poverty might have decreased but then when I look at the hard numbers its still higher than what it was in the last decade. I am surprised because I thought we were the economic powerhouse and were creating jobs like anything. In India sadly we don't have a data for the unemployment but I am sure the figure will be a shocking one. Indian economists love the numbers but then tend to forget the bad numbers. So despite the phenomenal growth poverty is rampant, slums are increasing in our urban centers and the welfare state which we thought we will become when we fought for independence is far from reality. So I believe economic growth or no growth we have screwed up our country big time. And lets not blame the politicians only we are equally to blame by our apathy and the race to earn more money to live a life of comfort.
Secondly we are all worried that the foreign financial rating institutions would downgrade our ratings. I am not a very big fan of FDI. Why?? Simply to say think abt it if we become an FDI intensive country imagine a scenario like the 2008 financial meltdown which would result in withdrawal of majority of the FDI from our economy and how our projects will be affected. That will send our economy into a tailspin. We were insulated from the financial crisis till now because our economy is majorly even now driven by domestic consumption. Yes given that I am not against FDI per se but in areas which have significantly high capital requirement and significantly low impact on economy like the airline industry.
I believe just due to the less globalisation of our economy we have been able to withstand the financial meltdown. We wouldn't want lots of FDI in the infrastructure and create a property bubble like it did in europe. Let the Indians work in the traditional way of saving and ourchasing. Easy credit only will increase the greed. And the greed of the big financial corps has to be financed by the taxpayer when the bubble bursts. So its not that bad as it looks. Cheers
First for the last decade we have had the second fastest growing economy in the world and thats quite an achievement as I am made to believe. But what does it mean to you and me? To me things commodities are expensive, inspite of me getting a good salary I end up spending almost all of it just to live a decent life. And I wonder what happens to the people who earn significantly lower than me. In India we often refer to everyone who is educated and working as the middle class but is it so in reality? And as a percentage of population the poverty might have decreased but then when I look at the hard numbers its still higher than what it was in the last decade. I am surprised because I thought we were the economic powerhouse and were creating jobs like anything. In India sadly we don't have a data for the unemployment but I am sure the figure will be a shocking one. Indian economists love the numbers but then tend to forget the bad numbers. So despite the phenomenal growth poverty is rampant, slums are increasing in our urban centers and the welfare state which we thought we will become when we fought for independence is far from reality. So I believe economic growth or no growth we have screwed up our country big time. And lets not blame the politicians only we are equally to blame by our apathy and the race to earn more money to live a life of comfort.
Secondly we are all worried that the foreign financial rating institutions would downgrade our ratings. I am not a very big fan of FDI. Why?? Simply to say think abt it if we become an FDI intensive country imagine a scenario like the 2008 financial meltdown which would result in withdrawal of majority of the FDI from our economy and how our projects will be affected. That will send our economy into a tailspin. We were insulated from the financial crisis till now because our economy is majorly even now driven by domestic consumption. Yes given that I am not against FDI per se but in areas which have significantly high capital requirement and significantly low impact on economy like the airline industry.
I believe just due to the less globalisation of our economy we have been able to withstand the financial meltdown. We wouldn't want lots of FDI in the infrastructure and create a property bubble like it did in europe. Let the Indians work in the traditional way of saving and ourchasing. Easy credit only will increase the greed. And the greed of the big financial corps has to be financed by the taxpayer when the bubble bursts. So its not that bad as it looks. Cheers
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