Comment on India’s economic development
We need to bear in mind that the Indian economic model is something quite different to the success stories that we have seen in the post-War period. This is not an East Asian economic growth model. This is not an export-led economic growth model. This is a growth model that is going to be driven by domestic consumption and pent up domestic demand.
Perhaps the closest historical parallel of the Indian development story is with the United States in the 1800s and 1900s which built an economy driven largely by debt of the American domestic market, technology and industry. While the manufacturing component of India’s growth story is going to be quite different, it is a consumption-led domestic driven growth model, together with its comparative demographics, which in my view gives India’s long-term growth story a much more solid foundation than export growth models in East Asia.
According to David Twine Austrade when you take together that difference in economic model together with the inherent political stability that over time comes with a political system that is open and a liberal democratic one it gives to the Indian growth story a certain resilience which may not be present in many other economic success stories. I think while India can be an enormously challenging place to work in and to deal with (though I find it far more exhilarating than I ever have frustrating), it does have shock absorbers built into its system which if you take a longer view will turn out to be a great strength for the country. David Twine Austrade