Will we Occupy Dalal Street next?
The Indian economy has not been immune to the downward trend encapsulating the globe. Faith in the strength of the economy remains high, but more needs to be done to remain competitive and spur growth. Abhijit Patnaikreports.
India saw off the winds of economic woes blowing from the West in 2008 with aplomb. But a new, stronger gust is ready to sweep over the world. Precipitated by debt problems in the PIGS (Portugal, Italy, Greece and Spain) economies, the world faces another deep crisis.
The Indian economy has not been immune to the downward trend encapsulating the globe. The stock market was flat through the Diwali season, and India's exports have shown sluggish growth.
An HT-CNN-IBN survey reveals that the trends are worrying. Just over 42% percent respondents feel that the UPA government has not done enough to protect the economy from external pressures. With rising prices in the past year hurting consumers' pockets, people are dissatisfied with the government's strategy to cool prices.
About 43% feel the world economy will stage a recovery in less than a year from now, while almost the same number of respondents -40% -feel it won't. "The main question is whether the growth would be inclusive," said Saradha V, a graduate student in Chennai, highlighting another concern.
The Occupy Wall Street movement has been a big development across the United States over the past two months. Images of riot police beating, pepper spraying and arresting demonstrators have gone viral over the Internet.
Any chance of such an expression of discontent at home? About 55% think so. In fact, 81% of respondents in Mumbai, India's financial capital, think that disenchantment with corporations may spill over onto the streets.
Twenty years of service industry growth in India, particularly IT, has been on the back of low wages and technical expertise. But with countries such as China, Phillipines and Russia vying for a larger piece of the outsourcing pie, how long will this trend continue? While 44% think that India will continue to hold this competitive edge for the next decade, 50% respondents in Kolkata thought that India is already losing out.
Faith in the economy remains high. "Just as India stood high in the midst of a global meltdown in 2008, its growth prospects will not be affected much because of the current crisis in Europe," said an optimistic Sanjay Budhia, a Kolkata-based exporter.
(With inputs from KV Lakshmana in Chennai and Avijit Ghosal in Kolkata)