Of late, India Inc has been the focus of world attention. After 60 years of independence, we can now look back and say we are on the right track to growth and development. Optimism is such, that any derailment is now out of question.
Each decade our economy has been going through significant changes. For almost 2 decades after independence, the primary sector, ie agriculture, forestery, mining etc., contributed most to our GDP. Slowly, in the 80’s investment started catching up and focus was laid on infrastructure initiatives like dams, power supply, irrigation, roads etc. When household savings reached a limit where it couldnt grow more, the Goverment started borrowing loans from foreign banks and establishments. A balance of payments issue in that period, led the government to liberalise and open up the economy.
The 90s saw a significant rise of the middle class, leading to more demand for consumer durables which in turn mobilised the growth of industry. Goverment’s loosened foreign policy, small scale initiatives, aides to industry resulted in more small businesses to sprout, generated jobs and therefore pushed demand. During this period the household savings and investments also grew. Growth rate charts showed a uniform upward trend. Education was starting to gain its much needed attention, many top class institutions sprung and the number of people graduating each year increased to new levels. Lot of stress was being given to job oriented and professional courses.
By the late 90s, growing skilled workforce, the arrival of the internet and liberalisation of the economy led to the IT boom in the country. Revenues rocketed, capital flowed in from all sides, middleclass grew richer and thereby savings and investment increased manifold. Household investors who earlier preferred fixed income investment avenues, started looking at new, ripe opportunities like stock markets and mutual funds. This boosted industry further. The political scenario had also started becoming favourable and all parties started realising that an investment and infrastructure based campaign would any day win more votes.
The growth for 2008-09 is projected at 10%. There is lot of optimism in the country and abroad. Foreign institutional investors and NRIs have been showing lot of confidence in our future and are keeping the flow of funds perinnial. It looks like people have realised that somewhere we were lagging behind and its now time to pull up our socks and get to work! Chak de India!!