Reason Behind Indian Economic Growth

[white leopard]

Today I was going through a world bank statistics report about south Asia and I was amazed by seeing that in last decade from 2000 to 2010 Indian GDP has increased by more than 350 %, from 460+ billion to 1.63 trillion and still for the year 2010-2011 their GDP growth was more than 8%.

Will people on forum like to discuss and elaborate what measures India has taken to boost up their economy. And unfortunately I don't know much about that.
And also if someone knows about economic reforms introduced by Dr. Manmohan Singh in 1990s. Please let us know...........

[shakeel ghori]

This is because probably India is "most close ally of america". except of this, there seems no clear evidence which can suggest so rapid development of Indian economy. As it is the fact that during British rule in subcontinent it was congress which professed the whole British regime and got much stable position in all sectors of life, but it was Muslim league whose defiance had to suffer a lot in all privileges related with the development.
Most certain cause of our staggering and shackled economy is the indulgence of our state in so-called war against terror and embezzlement of national money by our inept politicians.
enact of new constitutions of serving national money for country's development can provide us much stable economical position. But question arises as to who would do this? when representatives of nation themselves are busy in pointing fingers at one another for the acquisition of rule....

[white leopard]

Originally Posted by shakeel ghori

This is because probably India is "most close ally of america". except of this, there seems no clear evidence which can suggest so rapid development of Indian economy.

Yes to some extent its true because people of US are investing in India but question is that why in India?

Originally Posted by shakeel ghori

As it is the fact that during British rule in subcontinent it was congress which professed the whole British regime and got much stable position in all sectors of life, but it was Muslim league whose defiance had to suffer a lot in all privileges related with the development.

63 years has passed, Now it does not make sense.

Originally Posted by shakeel ghori

Most certain cause of our staggering and shackled economy is the indulgence of our state in so-called war against terror and embezzlement of national money by our inept politicians.

I am not comparing it with ours economic condition and comparison with India I do not think we will be able to compare in next 10-20 years. About our economy no doubt we losses much more than what we got but still if we compare, we improved a little bit but it could be much more...

Originally Posted by shakeel ghori

enact of new constitutions of serving national money for country's development can provide us much stable economical position. But question arises as to who would do this? when representatives of nation themselves are busy in pointing fingers at one another for the acquisition of rule....

Well well well yar discuss karnae mae kia jata ha. After all kal ko hum nae sambhalna ha yae mulk.........

[Faseeh Muhammad]

India is a big country, both area and population wise. Such a place is always lucrative when considered for investment because what ever one will produce he will find a ready-made market of customer for the product. This appears to me the reason why multinationals are interested in capturing the Indian Market.

Secondly they have, as a nation got some good characteristics that we don't have at all. While I can not come up with appropriate examples to support my argument, I do not feel hesitated to say that they love their country more then us. Neither friendship with US or Israel or some else is responsible for their growth. Take the movement of Anna Hazaray, It is meant for "General Good" of the nation viz the good governance.

When the masses of a nation loves its country, it creates a rhythm, a synchronization in their activities because they have a common goal. Such a characteristic, i am unable to find any where in my society. Difference of opinion is one thing, but hampering the efforts of each other when both parties are planning to develop something for the country is not understandable.

What i meant to say is that the growth of India is not a one day phenomena. It took years of activism and policy making and love that has resulted in the growth of India. If they had been same like us, every time govt. change the policy had been changing then their status of development would have been same as that of ours.

You can consider the example of Dams they have been developing on Indus basin, how many they have created, how many are under-development and how many in the Que? Why can not we develop such a plan for our country? We don't have any answer to this question.

This was some off-topic discussion. While googled out. Wikipedia describes the Liberal reforms movement in following words:

"The economic liberalisation in India refers to ongoing economic reforms in India that started on 24 July 1991...In 1991, after India faced a balance of payments crisis, it had to pledge 67 tons of gold to Union Bank of Switzerland and Bank of England as part of a bailout deal with the International Monetary Fund (IMF). In addition, IMF required India to undertake a series of structural economic reforms. As a result of this requirement, the government of P. V. Narasimha Rao and his finance minister Manmohan Singh (the present Prime Minister of India) started breakthrough reforms, although they did not implement many of the reforms IMF wanted. The new neo-liberal policies included opening for international trade and investment, deregulation, initiation of privatization, tax reforms, and inflation-controlling measures. The overall direction of liberalisation has since remained the same, irrespective of the ruling party, although no party has yet tried to take on powerful lobbies such as the trade unions and farmers, or contentious issues such as reforming labour laws and reducing agricultural subsidies. The main objective of the government was to transform the economic system from socialism to capitalism so as to achieve high economic growth and industrialize the nation for the well-being of Indian citizens".

Besides the reforms, the general image of India in the world is better in the context of terrorism & extremism. There are multiple extremist groups in India but unfortunately when ever there is some sought of international terrorist activity goes on, its traced back to Pakistan. The dismal image of Pakistan has made it alien international business community. |The day-to-day news of corruption, unrest and target killing, strikes, unavailability of electricity has placed a question mark for local investors for should they made any further investment here or not, what to ask about multinational groups.

The Saving from house hold contribute a major portion to the investment that is made in India. In Pakistan, soaring prices, savings are near to impossible and some is lucky to save money, it is de-valued against dollar due to our collapsing economy.


Increase in household savings and growing domestic demand have been the been primary drivers of Indian economic growth. Indian economy is dominated by Proprietorship and Partnership firms with nearly 100% share in agriculture, 50% in manufacturing and more than 60% in service sector. Household sector, with more than 70% of national savings is responsible for financing the growth witnessed by India.

"Savings rate in India or Gross Domestic Savings (GDS) has nearly tripled from 12% in the 1960's to 32% in the decade. 70% of this savings comes from the household sector that includes consuming households as well as the P&P sector. The much vaunted foreign direct investoment and portfolio investments constitute only 5% of the GDS"..

(Details here...)

This is somewhat i said in the earlier paragraphs. They are consistent with their policies. That is why they made such a progress.

[Shooting Star]

True,Growth of India is not a one day phenomena.

I would also like to add some points here:

India is investing in its education system and youth.They are producing quality labour force.So,the investors and other countries are seeing a potential future work force.Pakistan has youth as major chunk of its population but without proper education and training,they are unproductive hence a burden on nation.Unfortunately,Education sector is the most neglected area.

India has accumulated huge forex reserve and their Govt.Debt is only 38%-42% whereas counties like USA and Japan has 100% and 200% respectively.

India has encouraged investment in infrastructure and healthcare.Though many areas lack state of the art facilities owing to its big size,they are progressing.

India has emphasized more on FTAs(Free trade agreements)rather than accepting aid.Recently,they have done two free trade agreements with Malaysia(i don't remember the second country)and FTA with EU is being negotiated.

Though India is favorite of foreign powers but it is only because of its successful lobbying and diplomats.There "first line of defence" is very strong.They don't have to use force or any other means as they usually succeed at this level.

So,overall it is about taking positive steps at the right time.Which our rulers are hesitant to take.

As a result,We always end up as they say:

"It’s too late after you’re caught by a wolf, my little kitten."

Our major problem is that we react,not act.