Indian growth story carried forward by successive legacies
By Bal Krishen
Published: Thu 15 Aug 2019, 4:05 PM
Last updated: Thu 15 Aug 2019, 6:35 PM
The history of India's independence is the story of prolonged struggle to gain independence and be liberated from the virtues of its conquerors. Over the course of India's history, the nation has faced several invasions. From the Mogul empire' rule seen during mid 1520's to the British colonial rule that lasted for countless years, the nation has faced it all and even come out stronger with every struggle. For a country whose roots stretches back almost 4,000 years to ancient civilisations like Harappa and Mohenjo - Daro, different invasions at various time have only highlighted the rich & diverse resources that the county has had.
Ever since India's independence post August 15, 1947, Indian growth story has been carried forward by successive legacies and various political parties at the center. From a base of Rs93.7 billion in 1950's to the current numbers of $2.8 + Trillion, the GDP of the country has grown leaps and bounds. This has been primarily been possible due to empowerment of various sections of the society. While the jury is still out if all the sections are still being empowered for their inclusion in the society or being left out, majority view is of maximum participation that has taken place over the past many years. India owes much of its success to the numerous people that have participated in its freedom struggle & also the very first generation of entrepreneurs including Jamshedji Tata, Dhirubhai Ambani, Godrej, Birla, etc. who have ensured that Indian's cannot be left behind in the global growth story.
As per an IMF report last year in August, India is a source of global growth for the entire economy and it could be what China was for the world economy at the starting of this century. India now contributes in PPP terms more than 15 per cent of global economic growth. India's strength and its importance of being a pillar of growth especially in the South East Asian region comes from the fact that the nation has had a near double digit growth for several years. This came at a time when the global economy was slowing.
India's successful growth story can be best viewed through the rise in its benchmark equity index - Sensex. From a base value of 100 that was established in its base year of 1978-1979, the index had touched high of 40,267 during early June of this year. Most of the economic gains for India have been attributed to the bold economic liberalisation program of 1991 and various reforms that have taken place in last couple of years. Different liberalisation measures announced by the then Finance Minister Mr Singh included deregulation of markets, reduction of taxes and greater FDI slabs - all of which were hugely opposed by the nationalistic forces present at that time.
Currently, the incumbent government led by PM Modi further aims to strengthen India's hold amongst major economic powers & it further aims to make the country a $ 5 trillion economy within next 5 years, a step seen bold by many economists alike. Nevertheless, as per the statistics available this implies a growth rate of approx. 12 per cent in nominal terms each year over the next 5 years to achieve the target. Having set this ambitious target, work is cut out for the incumbent government and all eyes would be on the actual implementation part.
India's growth story is incomplete without the mention of countless number of Indian NRI's & PIO's who have contributed to India' success whether directly or indirectly. As per a recent statistic by India's Ministry of External Affairs, there are more than 30 million Indian NRI's & PIO's with the Indian diaspora amongst one of the world's largest.
USA tops the list with population of around 4.5 million Indian NRI's followed by UAE where the number is more than 2.5 million. For UAE, the Indian community comprises of roughly 30 per cent of the entire expat population, largest amongst its peers.
Time after time, Indian expats in UAE have successfully demonstrated values of leadership and entrepreneurship across the entire UAE and middle eastern expat community. This has inculcated spirit of confidence amongst other upcoming expat communities like new ones from African nations.
UAE & India - A Bond Strongly Build Over the Years
Relations between UAE & India are at a historic high. The strong bond between 2 countries has been build up and successfully nurtured as both countries seek to deepen cooperation in various fields. One of the main fields that is watched out for is the energy sector. Recently, ADNOC delivered crude oil for storage in Manglore Strategic reserve. Likewise, Indian oil company's consortium acquired 10 per cent stake in Lower Zakum Offshore field in Abu Dhabi. Defense is another sector which is getting a lot of focus with first bilateral naval exercise that was held in March last year.
Total trade between 2 nations reached a high of $ 60billion in 2018-2019 with exports from both sides roughly balanced near $30 billion mark. India, being UAE's second largest trade partner, is of strategic interest for the entire regions trade scenario. Among other initiatives being discussed between 2 nations is establishment of logistical, cold storage & warehousing hub that would essentially establish a food corridor between the two.
UAE investments in India is amongst the top 10 with approx. investments of $5.30 billion. The UAE has also been traditionally largest source of remittance to India. As per recent stats, the approx. amount is $50 billion being remitted to India on annual basis.
UAE also happens to be one of the topmost job creating nations for South East Asian aspirants. As per recent estimates, Indians along with job aspirants from other nations like Bangladesh, Pakistan continue to account for most of the job opening fillings.
One of the most important reasons for the success of the Indian expat community in UAE is the overall UAE rules & regulations that provide investor and expat friendly environment. This includes recently announced long term UAE residency visas with 10-year validity, which can be obtained for as low as Dh1,150.
Over the long term, Indian growth story is here to stay with ongoing positive contributions from both domestic as well as expat communities. As famously described in words of current PM Modi - "If 125 crore people take a step forward, the country would march 125 crore steps towards development".
Bal Krishen is the CEO of Century Financial. Views expressed are his own and do not reflect the newspaper's policy.