World Bank President Jim Yong Kim predicted that India’s economy will grow at 6.4 percent in 2015 and the IMF predicts that it will become the fastest growing in the world in the next two years. Though the positive sentiment on India’s potential is resonating around the world, CCTV’s Shweta Bajaj reported from New Delhi to take a look at the situation on the ground to evaluate the Indian economy’s opportunities and challenges.
Despite challenges, India looks to become major manufacturing hubWorld Bank President Jim Yong Kim predicted that India's economy will grow at 6.4 percent in 2015 and the IMF predicts that it will become the fastest growing in the world in the next two years. Though the positive sentiment on India's potential is resonating around the world, CCTV's Shweta Bajaj reported from New Delhi to take a look at the situation on the ground to evaluate the Indian economy's opportunities and challenges.
It’s been a year of hope for India. A more pro-active government has given an impetus to an economy that’s been shrinking in the last few years.
What’s worked in India’s favor is lower international crude prices and an increase in investment activity. And the IT industry has played a huge role in India’s growth.
Raman Roy, chairman of Quatrro Global Services, is known as the father of the Indian outsourcing industry and is credited with starting the boom. He said that in order to make the growth numbers of 7 percent a reality in the next year, the country needs to educate its population so that they are more employable.
Prime Minister Narendra Modi planed to make India a manufacturing based economy like China. A massive campaign called “Make In India” has been started in order to attract investment. The aim is to increase economic activity by making India a manufacturing hub.
The main reason for this is that India adds a massive 1 million people to its working population every month.
R Chandrashekhar, president of the National Association of Software and Services Companies, said policies need to change, keeping in mind the new realities where startups will contribute to India’s future growth.
“The large service companies actually require just business facilitation, smoother regulatory implementation of tax systems, etc. This is true for other segments as well,” Chandrashekhar said. “As far as the small companies are concerned and the startups are concerned, they require a supportive and facilitatory environment.”
One of the biggest challenges remains on the policy front. Despite many expectations from the Modi government, no big economic reforms have been implemented. The other issues India faces are tough laws and bureaucracy, which despite talks hasn’t changed.
India will announce its budget in February and it’s expected that some tough policy changes will be taken to make India’s dream of becoming a $20 trillion economy a reality. But though the plans look promising, it’s the speed of implementation that will matter.