Beyond the Crash by Gordon Brown

Author:Gordon Brown
Language: eng
Format: epub
Publisher: FREE PRESS
Published: 2010-07-15T00:00:00+00:00

CHAPTER 8

India and the Asian Economies

When I traveled to India as Chancellor and then as Prime Minister I had in the back of my mind the poetry contained in Amitabh Bachchan’s descriptions of the New India. He talked of a “new India whose faith in success is far greater than fear of failure,” a new India “that no longer boycotts foreign companies’ goods but buys up the companies instead,” a new India “looking up at the sky and saying it’s time to fly.”

There is no country in the world that has the potential for growth that India now has over the coming decade. India will see its workforce rise by more than 100 million men and women. There will be a rising number of what some people call the Indian baby boomers: young men and women in their thirties and forties who will comprise half the increase in the working population. A rising number of women will join the workforce (current women’s participation in employment is still among the lowest in Asia, at 33 percent, in contrast to China, at 70 percent). And there will be a fast-rising number who leave the land to become city dwellers.

Start in Delhi, with the scale of the University of Delhi and its 400,000 students, and then think of the ambitions for Indian education: a twenty-year plan for one thousand more universities.

Go to Bangalore, as I was fortunate enough to do, and you will see why some are predicting that India, and not China, will become the world’s fastest-growing economy. Companies based there looked less like factories than campuses where the engineers and computer scientists of the future are developing their skills. The Infosys campus training center (where fifty thousand young people are trained every year) is itself like a modern American city, with its lecture theaters, café culture, and cinemas. The company states that in 2007, when they took on forty thousand new recruits, over 1.25 million young people applied to join the company; it has increased its workforce from 10,000 in 2000 to over 100,000 today. My abiding memory of India is of highly ambitious young people studying day and night and all weekend to make the most of their talents.

India now has trend growth estimated to be 8.5 percent a year. Five years from now its economy will be half as big again. By 2020 it will have doubled in size.

One measure of the scale of India’s fast-developing domestic market is its 600 million mobile phone subscribers. A further measure of the speed of change is car ownership, which will rise fivefold in ten years from today, from 14 million to 62 million. Crucially, as Goldman Sachs suggests, the Indian middle class, 1 percent of the population in 2000 and just 5 percent today, could rise to 50 percent in just thirty years.

But India has more poor people than any country in the world. Indian per capita incomes are half that of China, and on the best recent estimates of poverty, 400 million people live on less than $2 a day.

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