As history remarks, from 0 AD to 1700 AD, India was the richest of all the economies in the world. By 1700, there was 32% of the wealth of the world, was in India. Then, came the era of colonization when different countries from the west started looting India with their trading prospects which ultimately led India to be a poor country (as westerners still think we are), but I am going to cite few examples as to how India is not an emerging economy, but a re-emerging economy. We were never poor.
At the time of Independence, the GDP of India was close to 4.2% and by 1973, during the state of Emergency declared by our then Prime Minister Indira Gandhi, India’s GDP was the lowest of around 3%. But, after that there was no looking back. Today, the world reckons and eyes the emerging markets which is adding more than 50% to the Global GDP Calculations and India is one of them. That means, the developed economies has realized the potential of these emerging markets, which has led to globalization. Rich in tradition and societal culture, India is not just an emerging economy but a well-balanced socio-economic hybrid.
In 1991, as India opened its gates to the world, the post era of liberalization has given India Inc., an upper curvature in all the graphs. There are strengths, which cannot be unnoticed and itself being researched and published by a lot of westerners and Indians themselves, but more or less suppressed to the world. This is what I call an Indian Edge.
There are few points which gives rise to this Indian Edge.
1. India, has always been a country of savings before liberalization and even after liberalization, the Gross Domestic Savings (GDS) accounts to around 30-32% despite western impact on India. Moreover, this GDS is utilized for capital formation which accounts parallel to the same amount of percentage growth. That means, a normal Indian still saves and create capital for himself/herself.
2. The domestic demand of India has always been more and despite of its global outreach, Indians consume a lot locally. That means, we are becoming globally local and locally global simultaneously.
3. India has low government and household debts then most of the developed economies in the world. That means, we are not that much in debt than most of the European countries like Italy, Spain, Germany etc and Britain having the highest debt.
4. India, is the second most entrepreneurial nation in the world, with the highest number of youth (aged 25 – 35), we have presently the highest number of startups in the world. Mexico being the first, marginally ahead by 1%. The number of Entrepreneurs in India, is around 18% from the world.
5. The Service sector in India accounts to 66%, which means a lot of Industries today are driven by different service sectors, which means there is an increasing demand-supply ratio in India, which will make us the most economically sustained nation in the future.
6. With people investing a lot in Gold (which is taken as consumption by global economists), even a small middle-class family has invested in gold, which has seen a tremendous and consistent rise in the last 30 years. And India is far more ahead than any other country in the world. Most of the gold reserves in US is under federal reserves, but in India, 75% of the total gold utilization is among the normal household.
7. The remittances to India from Indians all around the world is more than 50%. That means, there are a lot of Indians staying abroad who has a need to send their money to their loved ones in India or just for capital formation with sole intention of living their second innings in their home nation. This adds to the economic growth of India.
These are just few points, which describes India as a re-emerging economy. With ‘Jugaad’ i.e the Indian way of doing things out-of-the-box, Indians have more skills of doing the same thing in different ways. This adds to the Indian edge. With a lot more social parameters, which Indians are indebted to, India is not just a land of cows anymore. Well, every nation has its pros and cons. While every world is chasing its realms, India is never going to be ignored in the process. And the world will stop running behind GDP and Inflation but Human Development Index and Gross National Happiness, which India has to focus on. Then we will see India like in 1700.
Money can’t buy you happiness, or can it?