In one of the economics classes my teacher compared the game Chess with our Life because Chess is the struggle of a player, facing multiple hurdles, against the planned yet unpredictable moves by the opponent. One wrong move can spoil the whole game. Today as I read various news on the overall developments happening in India, I wish to compare Chess with our economy. Post-independence it has seen several ups and downs. Like Chess, relying on certain planned moves, expecting hurdles, and facing those clueless odds, the graph of Indian economy is now on its upward lap creating commendable milestones.

In December 2022, the World Bank Report presented the forecast for Indian economy as 6.9% as against the previous rate of 6.5%. In this phase of a failing global condition, the Indian economy has been extremely resilient because of its strong macroeconomic base. Whole world has been looking upon India as one of the fastest-growing economies. India is now a promising alternative destination for investments.

Economists across the globe are discussing the in and out of it. While they are busy with facts and figures, today, my thoughts are with the story of our growth post-independence. Being a statistician by profession, there is a habitual tendency in me to analyse the ongoing trend in everything. When that is obvious in my day-to-day life, needless to mention the interest I have in dealing with matters involving solid data. Indian economy is one such area where its long-term growth story of buoyancy and persistence really excites me.

As a student, in early 80’s, I still remember that my academic texts always referred India as a developing nation and our economy as a fragile one with very gradual growth. Though economics and its theories were not my cup of tea those days, for reasons unknown, I hated India being referred to as ‘developing’ than ‘developed’. But later in my college days, I started understanding more about its theoretical and analytical side. India has accomplished much in the previous years. Watching closely till date, I am amazed at the steady, balanced, varied and resilient growth story of our country. From the brand “third world country’ imposed on India during independence, it has grown to the 5th position in 2022, surpassing UK.

We can see that Indian economy has steadily enhanced in the last 5 decades. Till 1980’s it was below 5% and then it gradually went up till 5.5% during 1990’s. In the past 10 years it further went up, making the growth rate exceptional and stable for India, compared to other major economies, after liberalization. As I write this note India is estimated to be in top three economic powers in the world in coming years: Thanks to the stable long-term growth in agriculture, industry, and services with the fastest growth rate in service sector. Later, over a period, our economic growth got steered by increasing investment, exports, labor productivity gain and total factor productivity gain.

Morgan Stanley’s Chief Equity Strategist for India, Mr. Ridham Desai, recently commented that “India is set to surpass Japan and Germany to become the world’s third-largest economy by 2027 and will have the third-largest stock market by the end of this decade.” What an optimistic statement which is a confidence booster for any proud citizen! Progressive FDI policies, abundant natural resources, competent skilled human resources, efforts from authorities to improve ease of business, encouragement for youth to come forward into entrepreneurship highlighting the prospects of huge domestic market etc. has all largely contributed to this confidence.

With the structural reforms made time to time, India continues to attract attention of foreign stakeholders, despite the challenges triggered by global uncertainties. Acceptance of banking sector even among the unskilled working class, the ease of receiving uninterrupted governmental benefits, improvements in digital infrastructure etc. adds to it.

Another major game changer which I felt significant was the startups which created jobs contributing to the GDP. They are the competitive centers of innovation and advancement. Proper startup culture is making key advances in the unexplored market spaces round the globe. Zomato, OLA, OYO Cabs, Paytm etc. are few examples. Unlike the most seen science projects and exhibitions, platforms like The IndUS Entrepreneurs (TiE) gained importance even in schools with its entrepreneurship programs where students pitched innovative business ideas. Teachers are encouraging students to be an entrepreneur in contrast to the yester years where the only ‘glorified’ field was Medicine and Engineering. Authorities all over the world are recognizing the significance of startups and are employing measures to nurture them.

The strength of Indian economy can be attributed to its vast and varied diversity. India’s production pattern is so branched out that it is never dependent on the market for a set number of products, resources, or services. Our foreign policies and bilateral relationships are extraordinary that we have a wide range of trading partners. As a result, a slowdown in any part of the world will not have huge impact on India.

Incredible and successful growth journey of India owes to its long-term growth. Looking ahead in this new year, with further reforms and efforts to tackle the bottlenecks in specific growth pulling sectors we can maintain the momentum in India’s growth story. The constant power in domestic demand could act as the support system. Regardless of a possible slowdown in universal demand, inflation, prolonged monetary policy cramps etc. we hope to become the largest economy sooner.

Wishing all Indians in Kuwait a happy and delighted Republic Day.

Statistics Reference: www.economictimes.com