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Experts debate economy's future

india Updated: Nov 27, 2006 17:47 IST
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Hundreds of executives and policy-makers from around the world were gathering in New Delhi on Sunday to get a firsthand update on the country's sweeping economic transformation -- the opportunities it presents and the challenges it faces.

The three-day India Economic Summit organised by the Geneva-based World Economic Forum comes at a time when the Indian economy is growing by 8 per cent a year, driven by an unprecedented boom in consumerism and a surge in new investments.

A key issue at the summit is whether India can sustain, or even accelerate, its economic growth, said Lee Howell, the Forum's Asia head.

India has been among the world's fastest-growing economies for the past decade. Still, more than 300 million people live in abject poverty, earning less than a dollar a day.

Moving a substantial chunk of people dependent on agriculture to manufacturing and services and increasing farm productivity remain formidable challenges for policy-makers.

"Last year's summit focused on the positives of the Indian economy. This year, it will focus on the opportunities and challenges facing India's future economic growth," Howell said last week.

Infrastructure bottlenecks -- congested ports, ill-equipped airports, potholed roads, frequent power outages -- threaten to slow future economic growth. There also are other risks, such as the country's large number of people with HIV, which may affect productivity gains in the future.

Also, benefits from the rapid economic expansion over the past decade have been enjoyed mostly by a minuscule proportion of the country's 1 billion people.

On the opening day, the summit is focusing on how India can accelerate its economic growth to 10 per cent a year and make sure that gains from such an expansion are evenly distributed, Howell said.

Nearly 500 executives from 32 countries are attending the annual summit, where Indian leaders also are slated to speak on government plans and policies.

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