Future lights

The festival of lights, which celebrates prosperity and success both at home and in the market place, as one of our columnists notes, is also a time to do crucial stock taking. The buoyancy generated by the India growth story has proved to be remarkably resilient, despite rising oil prices and the sub-prime crisis in the US markets. A recent economic and hiring survey by McKinsey for the latest quarter indicates that 77 per cent of Indian executives believe that the country’s economy would only get better.

Such optimism is anchored by some extremely heartening trends on the ground. As this newspaper has just reported, all indications are that Indian agriculture — upon which depend the lives of millions of Indians across the country and which has long bucked the rising growth trajectory — is expected to register a growth rate of 4 per cent. Meanwhile the Sensex crossed 19,000, indicating that the country continues to be an attractive investment destination. Despite all the controls on foreign capital, the fact that dollars are flowing into India is a vote of confidence in its economy. A stronger rupee has increased the purchasing power of Indians, drastically changing their lifestyles. More Indians are travelling, both within the country and abroad. More Indian companies have gone on a shopping trips abroad. Modern retail is making good quality products available to Indian consumers at cheaper prices. Merchandise exports continue to be high. Imports have risen, indicating a rapidly growing industrial sector, and rising investment in infrastructure — roads, power, ports and airports. All this portends well for sustainable industrialisation, easing some of the serious constraints it had always faced. Real estate development, which creates infrastructure, is high on the list of investment projects being implemented and this too bodes well for the future. As a consequence of these trends, government tax revenue has also registered impressive gains.

With demographics on its side, India will now have to think seriously of maximising its human potential. The draft Eleventh Five Year Plan proposes significant increases in government spending on health and education, broadening and deepening the idea of inclusive growth. Through a new emphasis on quality higher education and vocational training, India could soon have the largest trained and English-educated workforce in the world. Talk about future lights.