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Rediff.com  » Business » Big blips in India's growth story

Big blips in India's growth story

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Last updated on: November 01, 2003 13:15 IST

Is India about to become a key player in the new global order where hi-technology re-fashions our lives in scores of different ways? Anyone who is feeling unduly exuberant about our prospects should take a trip to Agra and the Taj Mahal.

Here, in the heart of Uttar Pradesh, eternal India rules and the hi-tech revolution might never have happened.

The peak tourist season is upon us but there aren't that many foreigners in sight. Perhaps, they were frightened away by the talk of nuclear war last year and they haven't heard that India is the globe's new economic star and talking about being the China of the 1990s.

The shortage of tourists has made the touts at the tourist sites desperate to make a sale and more aggressive than ever before. Things aren't helped by the attendants of the Archaeological Survey who go out of their way to be rude to tourists.

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Meanwhile the stock market is booming and the feel-good factor is boiling over in urban India. Goldman Sachs tells us that the BRIC (Brazil, Russia, India and China) countries will be the decade's hottest destinations.

The software industry is bracing for an unstoppable bout of growth and the top companies are gearing for hiring sprees of monumental proportions.

Of course, it isn't only software that's looking forward to a brighter tomorrow. The fledgling BPO industry is hoping for a vertical take-off in the next few years. And some of the software giants are hoping to convince existing clients to also buy their BPO offerings.

Meanwhile, what's happening in the telecom industry? Giant battles are still being fought, but in spite of that, more than one million customers are being added each month.

The result: After all the blips and regulatory missteps, India is the world's second fastest growing telecom market.

Take a look at more traditional industries like automobiles and it's clear that Indians are finally taking to the roads in the numbers that were predicted over a decade ago.

So, it isn't surprising that the stock market is brimming with a new enthusiasm that's hardly ever been seen before.

The market is convinced that India's growth story will continue to grow for the foreseeable future -- if politics doesn't bring it all to a stop.

Are we right to be quite so optimistic? Amidst all this, we sometimes forget how far behind the world we've fallen during the '80s and '90s.

While the rest of the world was pushing forward, India was loosening the regulatory apron strings at glacial pace.

It did give the economy time to adjust to new realities. But it has meant that we moved at snail's pace when others were galloping.

How far behind the world are we? Consider that steel baron Lakshmi Mittal makes much more steel than India. Don't even talk about the Chinese who make and import stratospheric amounts.

The Chinese have an astonishing plan to multiply steel capacity in the next three years. It probably won't happen but it's a plan that the world's steel industry fears.

India's roads are better than before but only by our own low standards. Meanwhile, Indian airports are probably the worst flyways in the world.

Everywhere in Asia and the airports are glittering glass and steel palaces. Singapore, Kuala Lumpur, Hong Kong and Bangkok all have state-of-the-art facilities.

Travel in other directions and the three-year-old Dubai, comes complete with giant indoor palms. Shanghai and Beijing are second to none.

Then drive up the concourse to Delhi's Indira Gandhi International Airport at around 10.00 pm. This has always been a bad time at IGI Airport.

Nowadays, the crowds are unimaginable. More people are flying than ever before and the arrival lounge is more antiquated than Heathrow in the 1960s.

Moscow's Shernenko Airport was very similar to Indira Gandhi back in the mid-'90s but there weren't as many people milling around.

Of course, there's no way that India can solve all its problems at one time. The Chinese have, for instance, tackled one trouble area and then moved to the next. But our backwardness shouldn't be a millstone around our necks.

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Paran Balakrishnan
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