India’s industrial sector welcomes ‘growth oriented’ budget
In a nation's history, a decade is a mere point in the continuum of time. Decades from now, historians are likely to describe the latter part of the first decade of the new millennium as the period when the Indian economy, aided by a well-designed structural reforms programme, had come to a man's estate after two decades of adolescent angst.
When former Coca-Cola executive Neville Isdell agreed in May 2004 to come out of retirement to become chief executive of the global beverage giant, little did he realise that many the direction of his first global move was under keen observation.
Many believed that he would hop across to neighbouring Mexico, the largest market for the soda giant outside the US. He confounded analysts by choosing India, which he felt offered greater growth potential for the company that was troubled by dipping sales volumes.
On his tour to India and populous neighbour China shortly after he took charge as CEO, Isdell realised a different reality: the scorching summers in the two emerging Asian giants would help offset the weak consumer demand in the home markets of North America.
Two years ago, US President Barack Obama arrived with the largest US business delegation to any country, which included the who's who of America's corporate world - a clear sign that India's rising economy has never mattered more than now.
India's gross domestic product (GDP) is set to cross $ 2 trillion, joining an elite league of the US, Japan, Germany, China, UK, France and Italy, as the mass of economic activity shifts to Asia. Yet, keeping hunger at bay has been one constant policy challenge over the last six decades. The World Bank reckons that more than 400 million Indians live on less than $1.25 a day. Indian estimates of poverty range from 270 million to 450 million people.
By most standards, India has been a 'welfare laggard', and has still a long way to go before it can get food into every needy mouth. The Food Security Bill promises to do precisely that.
India's per capita income, calculated by evenly dividing the national income among the population, is nearly Rs. 70,000 a year. The figure gives an idea of the standard of living of the people, although it may hide a stark reality: much of the income growth may have been driven by the richest Indians. In 2011, according to Forbes, there were 57 dollar billionaires in India. The 100 richest in India had a combined net worth of $241 billion or Rs. 12,06375 crore, representing 16% of the country's GDP.
If the first term of the UPA government was about proof of concept - 'growth with equity' - with successful programmes such as the Mahatma Gandhi National Rural Employment Guarantee Scheme, the next has been about proof of delivery.
Fertiliser and fuel prices are in the process of being fully decontrolled; two of India's biggest tax reforms initiatives - a unified goods and services tax and the direct taxes code - are in the final lap of implementation.
Despite a delicate coalition, the government last year announced what looks like the second innings of sweeping changes, with an eye on India regaining the advantage that seemed lost in 'policy inaction'.
India's reforms have been underway for 20 years, during which the country has achieved an annual average growth rate of about 6%. In the last 9 years, India has grown at over 8%. Add up all the changes over the last nine years, and the UPA government will have created an enviable body of work.