`In the long run India is doomed. It is too diverse, too democratic, too corrupt, and too ungovernable to be a global economic powerhouse` Discuss.

FUTURE OF INDIAN ECONOMY

Chapter One : Introduction 3

Chapter Two : Analysis 3

Chapter Three : Conclusion 9

References 11 1 . Introduction

India has abundant labor force both in skilled and unskilled as it has population of 1 .1 million which makes it second largest populated nation in the world . India 's GDP is 3 .720 billions USD which makes it as the fifth largest economy of the World (Fig 2005 ) and it has abundant capital and is also attracting Foreign Direct Investments in large quantity in recent years . India is

the second largest democratic country of the world

Indian economy has witnessed an abnormal growth in recent years due to its leadership in [information technology] outsourcing industry in the world . India is witnessing an unparalleled economic growth and this has made many developed countries not only to envy on India but also makes them to concern

Is really Indian economy is strong and robust ? Whether India will be the economic super power in near future ? These are the research questions which this essay is going to focus on

2 . Analysis

India has witnessed a double-digit economic growth consecutively for the last three years and it is to be observed that this is a potentially a dangerous indicator as inflationary spiral have started to surface Economists are very cautious as they feel that sustainability of India 's economic growth is only a short phenomenon . According to certain economic observers , India 's economic growth is rather cynical and not of structural in nature

Economist do agree that India 's recent economic growth is unparallel in nature but they only questions about the path that India has pursued to attain that economic development . It is to be remembered that the path that is being pursued by the India has not been adopted by another country in the world . Further , they were of the opinion that there exists no previous proven economic model to substantiate this phenomenon

The India 's present economic growth is based on two fundamentals namely its domestic consumption and its competitive advantage in services industry . There is a sharp difference between Indian economy and other developed economy as developed economy is built on its exports growth and its strength in manufacturing process . Hence , Indian economy is strikingly different as it is based on its domestic consumption and its competitive advantage in services industry and this factor makes concerns for many economists

According to study made by IMF economist in 2006 , India has begun to behave like the industrial countries at nearly when its income is at one-fifth level and has shifted to servicing sector thereby skipping manufacturing sector and this is in stark contrast to the development path pursued by the East Asian Countries in the late 1960 and 1970

It is to be noted that Chinese economy is more industry specific and manufacturing oriented . In contrast , India has shifted suddenly from intensive industries in the last two decades and fastly focusing on skill intensive industries . Service industry has become the...