WHY INDIA IS THE ONLY COUNTRY AMONG 72 OTHERS TO PROGRESS AT A FAST PACE , WHICH HAVE STARTED ECO REFORMS IN 90S...

1. INDIA’S ECONOMIC REFORM
PRIYANK JAIN

2. Even though the world has
just discovered it, the India
growth story is not new
It has been going on for 25 years

3. 28 years of high growth
1.0
3.5
6.0
8.67
Average annual GDP growth
0
2
4
6
8
10
1900-1950 1950-1980 1980-2002 2002-2011
(%)

4. Literacy is rising
Source: Census of India (2001)
17
51
58
71
0
20
40
60
80
100
1950 1990 2000 2011
(%)

5. Poverty is declining
46
26
16
1% of the people have
been crossing poverty
line each year for 25
years
Equals ~ 200m
0
10
20
30
40
50
1980 2000 2011
(%)

6. Per capita income gains
Source: World Bank
US$ ppp
20113,321
1980
1,178

7. India is now the 4th largest
economy
It will overtake Japan
between 2012 and 2014
to become the 3rd largest

8. Rise of globally competitive
Indian companies

9. India has a vibrant private space
 100 Indian Companies have market cap of US$ 1bn
 1,000 Indian Companies have received foreign
institutional investment
 125 Fortune 500 companies have R&D bases in India
 390 Fortune 500 companies have outsourced software
development to India
 2% bad loans in Indian banks (v~20% in China)

10. Key reforms
 Opened economy to trade and investment
 Dismantled controls
 Lowered tariffs
 Dropped tax rates
 Broke public sector monopolies

11. Understanding India’s economic success
 Remarkable --every government has reformed
(slowly) since 1991
 Even slow reforms add up
 65 countries have done the same reforms – why did
India become the second fastest growing country in
the world?

12. Per capita income
2,100
3,050
5,800
16,800
37,000
On a ppp basis
2000 2005 2020 2040 2066
0
10
20
30
40
($000)