‘GDP likely to average 6.5 % over next five years’

[sancho]

China has slowed down too ....no doubt ...but China has slowed down after near double digit grown for more than 2 decades

Because they started a decade earlier than we did with credible reforms, but most importantly, they suffered just as we did in the same situation of a global slow down.You can't simply ignore that and only show their good years of the past. They have reached their peak, ours is still to come, that's why we actually are closing the gap now, but most of India doesn't see that. It is simpler to blame the government and point and China as an example, even if the reality is showing us something else!

Signs of Cooling of Chinese economy were evident even before these financial crises took its toll on global economy ....

But not at this rate, you can check the GDP charts for them since 2008 when the banking crisis came and see the results. They had a small improvement till the global financial crisis came, just as we did too, but then the global effect simply was stronger than any potential of China and India. The world is still admiring China AND India for our growth rates in these years, the world has applauded India for not overprivatizing the banking sector like the west did, which is why we came out far better out of the banking crisis and the world is eager to invest and deal with India again. But it's only us that thinks everything was bad in the last years and that we suffer in economical, or defence terms.

Should we be complacent about 50% drop in our GDP growth because China is also slowing down ....?

Of course not, but please ask also why! Look around and check if that is a national effect, or a global! And don't point to China only for their good examples, but also when they have bad examples!

See things from both / all sides!

I think it's well known and widely accepted fact that lack of governance and policy paralysis contributed to flight of FDI

On the contrary, silly governance and silly policies to tax companies even in retrospective, were a cause too. For the GoI it was a fast way to get money, for foreign companies it makes India less attractive to invest. So there are also 2 sides, good and bad governance, or good or bad reforms.

 

[madooxno9]

U don't understand the real danger.
The indian economy is a consumption based economy.

Our manufacturing growth is in negative which will be a problem if it dosen't pick up.

We export nothing except fruits,vegetables and software products.

Bloody nothing.

And ur comparison with germany and china is wrong.

are you serious ? Export might have dropped but it does not mean we do not export anything.

Bit old but still gives you a rough idea.

And here is a link click it and you will see list of products we export.

There are few surprises : Top Export Import Products of India | Major Import Export Items

 

[Dem!god]

are you serious ? Export might have dropped but it does not mean we do not export anything.

Bit old but still gives you a rough idea.

And here is a link click it and you will see list of products we export.

There are few surprises : Top Export Import Products of India | Major Import Export Items

latest import export figures have been released ...why u no quote that....
its old + its for only 6 months.....

 

[madooxno9]

latest import export figures have been released ...why u no quote that....
its old + its for only 6 months.....

Lazy boy i am , .It's 5:20 pm and i just woke up

 

[Indo-guy]

latest import export figures have been released ...why u no quote that....
its old + its for only 6 months.....

Lol...why you no quote that ....

 

[Dem!god]

Lol...why you no quote that ....

because I am too lazy too search....

 

[Indo-guy]

because I am too lazy too search....

I hope somebody else doesn't ask same question to me .....

 

[my2cents]

@sancho

I agree to certain extent that we have been unscathed from the vagaries of world economy.

We have been basking on our consumption oriented economy for too long. When the going is good, we were complacent and lethargic. Just to list a few...

- No across the board good governance and business climate.

-We failed to reduce our bureaucratic bottlenecks.

-Corruption is still rampant in each and every govt. department.

-We have failed in reducing our poverty goals and sanitation goals.

-Our exports growth have come down drastically.

Thd main concern is manufacturing and exports.
Rest is bullshit.

Just improve manufacturing and we have a potential to cross 10 pc.
Without it we will be lucky to clock 6 pc

Our exports constitute 20-25% of GDP for past one decade. As we were growing our exports also grew. at least we kept pace with our exports even when the world economy was in trouble.

 

[sancho]

What " lot of good things" UPA got India ???

Economy has gained a lot in the last decade, the poverty is gone down, more and more people went to the middle class, which currently has a living standard much comparable to the western middle class too. The fact that India is polio free now and that we have destroyed all chemical weapons which the whole world saw as as major achivements, but went down pretty unnoticed in India. Most of all our foreign policy is a true success story in the last decade. It might have even started earlier, but what we have achived in this field is simply great. We have gained more respect, admiration, or support than ever before, because of our sane and wise policies or behaviour. What people in India see as weak, because we didn't attacked Pakistan after 26/11, or China when during the border issues, was seen from the world as, India is not the nuclear armed 3rd world country, but a responsible regional power in Asia. We are one of the few countries that could deal with Iran and the west, between Palestine and Israel, or even with Pakistan and China in responsible and improving ways.
In the UN India today has full support of the big countries and 187 of 193 countries voted for us to be part of the non permanent members council, which is huge.
Is there another country than India, that can openly vote against US policies, or even stand against them like in the Khobragade case and still have good political relations to them and their allies.
Not to mention the progress we made in the last few years with the Gulf countries, not only for economical terms, but today we even have defence related official contrats with them. Although I am still uncertain about that, we can't deny that we have gained a lot trust from them and are not only seen as the enemy of Pakistan or the supporter of Israel.

I'm sure I have missed some things and I am well aware that there are several bad things too, but one have to see the whole picture and get to a conclusion and from my (maybe outside) point of view, it was by far not as bad as it is made in India now, as part of the elections. Credits should be given to those who has earned it, in the same way as we criticise them for the bad things, but we often blame politicians only and to easily.

 

[Jlaw]

I think it's well known and widely accepted fact that lack of governance and policy paralysis contributed to flight of FDI as well as downturn that economy took

Off course global factors also contributed ...

But then think why we could pass 2008 crisis largely unscathed ....only to receive jolts of economic slowdown in recent years ....

India was unscathed in 2008 because your financial market was not big enough to cause the Indian financial crisis. Indian economy is not linked to US economy on a large scale like Europe and East Asian countries.

 

[Srinivas]

The average will be more than 6.5 % for sure

‘GDP likely to average 6.5 % over next five years’ - The Hindu


View attachment 25343
There is only a 50 per cent chance India’s gross domestic product (GDP) will average even 6.5 per cent over the next five fiscals, according to a Crisil Research report, and that too, is predicated on a decisive mandate in the ongoing general elections. The report, titled ‘Of growth and missed opportunity’, notes that election outcomes don’t impact the economy beyond improving sentiment. What matters are the policies that follow. A decisive mandate will create an environment for speedy resolution of policy bottlenecks, hasten reforms and crank up investment efficiency.

India’s Incremental Capital Output Ratio or ICOR, which measures investment efficiency, has worsened to almost 8 in the last two fiscals from 4.4 during the high growth period of 2003-04 to 2010-11. Higher the ICOR, lower the efficiency of investment. So the task before the new government is laid out clearly — the focus has to be on improving the efficiency of the economy by debottlenecking it.

However, if there is no clear mandate at the battle of ballot, growth will likely remain in the 5 per cent rut.

The report says that evolving investment dynamics suggest there is a natural limit to the upside beyond 6.5 per cent. Neither a surge in investments nor improvement in efficiency witnessed in fiscals 2004-11 — which led to near-9 per cent GDP growth — would repeat in the next five years.

If the report is to be believed there is only one in five chance of growth being better than 6.5 per cent.

The ramifications for businesses and the economy at large will be huge in terms of social objectives and the opportunity loss for India Inc, the report notes.

Calculating the specific missed opportunities, Crisil Research said some 16.5 million passenger vehicles (cars, utility vehicles and vans) will be sold over the next five years if GDP growth averages 6.5 per cent. This number would have surged to 18.5 million at 9 per cent GDP growth. The missed opportunity, therefore, is 2 million vehicles or approximately sales of the entire passenger vehicles industry for the current fiscal.

A slower economy will also curb demand for steel and cement, which had hit unprecedented highs during fiscals 2004-11 on the back of near-double-digit industrial growth and housing boom.

Growth has more than halved since then. Predictably, therefore, the missed opportunity is greater here — 125 million tonnes of cement and 42 million tonnes of steel, when the economy expands annually at 6.5 per cent instead of 9 per cent.

GDP growth at 6.5 per cent will mean sales of televisions will be fewer by 13 million, refrigerators by 6 million, washing machines by 3 million and air-conditioners by 6 million. At 5 per cent growth, the missed opportunity bloats further — for television and refrigerators it is 17 million and 9 million, respectively.

Crisil calculates that as many as 226 million people will remain below the poverty line at the end of fiscal 2019 if growth averages 6.5 per cent. On the other hand, at 9 per cent growth, the number of destitute will reduce to 177 million, bringing about a sharp decline in India’s poverty ratio to 13.6 per cent from 22 per cent now. Conversely, assuming 5 per cent GDP growth would mean India’s poverty ratio would just moderate to 19.6 per cent.

Not growing fast enough will also mean as many as 15 million less non-farm jobs created, forcing many to remain locked in agriculture, Crisil Research said.

 

[Indo-guy]

Economy has gained a lot in the last decade, the poverty is gone down, more and more people went to the middle class, which currently has a living standard much comparable to the western middle class too. The fact that India is polio free now and that we have destroyed all chemical weapons which the whole world saw as as major achivements, but went down pretty unnoticed in India. Most of all our foreign policy is a true success story in the last decade. It might have even started earlier, but what we have achived in this field is simply great. We have gained more respect, admiration, or support than ever before, because of our sane and wise policies or behaviour. What people in India see as weak, because we didn't attacked Pakistan after 26/11, or China when during the border issues, was seen from the world as, India is not the nuclear armed 3rd world country, but a responsible regional power in Asia. We are one of the few countries that could deal with Iran and the west, between Palestine and Israel, or even with Pakistan and China in responsible and improving ways.
In the UN India today has full support of the big countries and 187 of 193 countries voted for us to be part of the non permanent members council, which is huge.
Is there another country than India, that can openly vote against US policies, or even stand against them like in the Khobragade case and still have good political relations to them and their allies.
Not to mention the progress we made in the last few years with the Gulf countries, not only for economical terms, but today we even have defence related official contrats with them. Although I am still uncertain about that, we can't deny that we have gained a lot trust from them and are not only seen as the enemy of Pakistan or the supporter of Israel.

I'm sure I have missed some things and I am well aware that there are several bad things too, but one have to see the whole picture and get to a conclusion and from my (maybe outside) point of view, it was by far not as bad as it is made in India now, as part of the elections. Credits should be given to those who has earned it, in the same way as we criticise them for the bad things, but we often blame politicians only and to easily.

You are too kind to UPA !!!

India was unscathed in 2008 because your financial market was not big enough to cause the Indian financial crisis. Indian economy is not linked to US economy on a large scale like Europe and East Asian countries.

and in just few years later Indian financial market grew suddenly & Indian economy got linked to US economy to the extent to have its decade long GDP growth virtually halved ???

 

[Jlaw]

You are too kind to UPA !!!



and in just few years later Indian financial market grew suddenly & Indian economy got linked to US economy to the extent to have its decade long GDP growth virtually halved ???

Financial crisis was just that. Bad mortgages, derivatives repackaged as investments, repackaged again and again. India's financial markets do not deal derivative to the extent like US and European markets on a monetary scale.

 

[Indo-guy]

Financial crisis was just that. Bad mortgages, derivatives repackaged as investments, repackaged again and again. India's financial markets do not deal derivative to the extent like US and European markets on a monetary scale.

Understood what you are trying to say ...

There is a lengthy joke about " Two Cows" situation ....


This is Goldman Sachs situation :


" You have two cows.

You sell three of them to your publicly listed company, using letters of credit opened by your brother-in- law at the bank, then

execute a debt/equity swap with an associated general offer so that you get all four cows back, with a tax exemption for five cows.

The milk rights of the six cows are transferred via an intermediary to a Cayman Island Company secretly owned by the majority

shareholder who sells the rights to all seven cows back to your listed company. The annual report says the company owns eight

cows, with an option on one more. You sell one cow to buy a new president of the United States, leaving you with nine cows. No

balance sheet provided with the release. The public then buys your bull "

 

[Jlaw]

Understood what you are trying to say ...

There is a lengthy joke about " Two Cows" situation ....


This is Goldman Sachs situation :


" You have two cows.

You sell three of them to your publicly listed company, using letters of credit opened by your brother-in- law at the bank, then

execute a debt/equity swap with an associated general offer so that you get all four cows back, with a tax exemption for five cows.

The milk rights of the six cows are transferred via an intermediary to a Cayman Island Company secretly owned by the majority

shareholder who sells the rights to all seven cows back to your listed company. The annual report says the company owns eight

cows, with an option on one more. You sell one cow to buy a new president of the United States, leaving you with nine cows. No

balance sheet provided with the release. The public then buys your bull "

Unfortunately this joke is not too far from reality. That is how bankers and stock market work for the most part.