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What Happened to India as a Global Economic Player?

August 26, 2013, 12:00 PM

What's the Latest Development?

As a member of the BRIC countries, India was suppose to be a new major player in the global economy. Alongside Brazil, Russia, and China, expectations for India included double digit economic growth, an innovative automobile industry, and strong currency. The reality has proven anything but: "Economic growth has slowed to around 5 percent, car sales are showing negative growth for the first time in 12 years, the Indian rupee has fallen 16 percent against the US dollar since May, and the Bombay stock exchange is down to an 11-month low." As the American economy recovers, India's has taken a more serious hit than any other BRIC country.

What's the Big Idea?

Economists blame the failed promise on the Indian government's malfeasance. Plagued by one corruption scandal after another, the government continues to dissuade foreign investment by failing to offer credible promises about the security of doing business in India. "There's a complete lack of trust. No one is going to put money [into India] until a new government is in place," says Devangshu Datta, market analyst and editor of Indian Infrastructure. "There's a complete collapse of investment and consumer demand and it is unlikely to look up, despite the government trying to make things a little easier."

Photo credit: Shutterstock.com

Read it at the Christian Science Monitor


What Happened to India as a...

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