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'Poverty drag on Indian economy'

Fortune editor Robert Friedman says India needs to address poverty before it can call itself a global power.

india Updated: Nov 10, 2006 13:27 IST

India needs to address several challenges like poverty and infrastructure before it can call itself a global power, says Fortune Magazine's international editor Robert Friedman.

"India's poor infrastructure and poverty are going to be a drag on the country's economy. If it has to emerge as a global power, it has to take care of a number of issues," Friedman said.

Saying that 30-40 per cent of agricultural produce rots in storage every year as they are not marketed properly, he added, "This happens due to a poor public distribution system. India has tremendous potential and can do wonders with its immense agricultural potential."

"It should learn from China, how it has been able to tackle the problem of poverty over the years by turning the country into a manufacturing hub by taking advantage of cheap labour, whereas India was more cautious."

He was speaking in New Delhi on Thursday on the sidelines of a conference where it was announced that India was the next choice for holding the Fortune Global Forum - a multimillion-dollar event where leading multinationals, CEOs, academicians and economists participate in brainstorming sessions.

Suggesting ways to improve the country's infrastructure problems, Friedman averred: "The problem of infrastructure is too much for India to handle on its own. So it should invite more investments and open up to foreign capital either by forging joint ventures or through private equity."

He stated: "The Tata-Corus deal is a baby step towards a broader economic development. However, it is definitely a learning process and reflects the fact that Indian companies are not any more governed by protectionist barriers."

The fact that companies like Wipro, Infosys and Tata Consultancy Services are opening their offices outside the country is a proof of how global Indian companies want to be, he said.

"India is a very intriguing country and richly diversified, so it remains a challenge for global business establishments to understand how a diverse population of more than a billion can have common tastes yet different consumerial behaviour," Friedman said.

The company is also exploring investment opportunities in the country to establish its offices here.

Friedman highlighted: "Next year during the forum we plan to explore various investment opportunities here and setting up an office here is very much there in our agenda."

"Currently only 20 per cent of our circulation is out of US, and in India we sell a meagre 10,000 copies annually which needs to be scaled up as India's economy is booming and we need to increase our presence here."