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Speech_India Potential and Growth Story_MR

Speech_India Potential and Growth Story_MR

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India’s Potential and Growth Story Introduction Macro Economy of IndiaIndia’s macroeconomic performance India is the second fastest

growing economy in the world (please insert growth rate here. What is the source?). In the year 2007, when India’sn GDP touched the USDa 1one trillion mark, it joined an elite group of just 12 countries to have reached this milestone. occupied a sparkling position in the elite group of 12 countries. India’sThis highly diversified economy has shown witnessed remarkable resilience since with the introduction of the 1991 reforms, which opened the economy to participate more freely in international trade and investment. The Indian economy has not suffered significantly during global economic crises, such as the did not suffer much due to the occurrence of the events like Asian currency crisis of 1998, the dotcom bust of 2001 and rising oil prices in the recent past. Despite these road bumps in the global economy, India and was able to record an average annual GDP growth of over 6.5% in the past decade. Going forward, the country is targeting an average GDP growth rate of over 8% per annum. In fact, the prime minister has exhorted India to target an economic growth rate of 10%. This robust growth is fully in congruence with ourthe macroeconomic stability. Our growth has been marked by and its notable progress in the field of information technology, high end services and knowledge process services. It has consistently showed a growth rate of 8%- 9% before the global financial crisis. Huge inflow of foreign funds, growing reserves in the foreign exchange sector, IT and real estate boom, and a thriving capital market has remained a key feature of Indian economy. The strength of the Indian economy can also be judged from the fact that the global financial crisis had minimal impact on the overall economy. The economy was still able to attain GDP growth rates at of 7.3% in 2008 while other advanced economies like US had a growth of 0.431%. During the year 2009-10, the Indian economy registered a growth of 7.4 per cent according to the estimates by the Ministry of Statistics and Programme Implementation. This It was primarily due to a surge in the manufacturing, mining and agriculture sectors. The manufacturing sector, which accounts for 80 per cent of the index of industrial production (IIP), grew 19.4 per cent in April 2010, as against 0.4 per cent in April 2009. 2 The service sector which accounts for more than half the GDP has remained the backbone of Indian economy. Foreign investments have been growing at a sharp brisk pacerate in India. The total foreign investments were USD 66.5 billion in 2009-10, more than 3 times the level in 2008-09, when it was as compared to USD 21.3 billion during 2008-09. This has also led to increase in the foreign exchange reserves from USD 251.7 billion in April 2009 to USD 279.6 billion in April 2010.3 Increasingly, Iinvestors in advanced economies have shifted from mature European markets towards the more emerging Asian markets Despite the fact that many sectors have allowed 100% FDI, India still needs to tap its full potential as a destination for foreign investment. The government expects to bring more economic and investment reforms to provide more opportunitiesy to foreign investors. It was during this year that the complete liberalization of pricing and payment of technology transfer fee, trademark, brand name and royalty took place. And now these payments are even allowed under automatic route. India is in the midst of major social transformation where the economy is showing signs of returning shows positive signal to return to the 9.0 % growth trajectory. Its vibrant and innovative private sector
1 2 3

IMF World Economic Outlook report, April 2010 The Hindu (Date? Title of article?) FICCI , May 2010 (What is the report name?)

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Manufacturing in India accounts for the 80% of the Index of Industrial Production5.5% and 9% for 2010-11 and 2011-12. many economists and traders expect worries about the euro zone debt crisis.7% in 2011-12. we even feel proud to say that India surpassed Canada.com 2 .9 % in the first quarter of 2010 as against 1% in the first quarter of 2009. respectively. 4 5 6 PWC report (What is the title? Please specify) News One India (Date? Title?) Economic Times (Date? Title?) Economic Times (Date? Title?) 7 8 www.2% in 2010-11 and 8. India is also expected to become the third largest economy in the world by purchasing power parity by 2012. The Index of Industrial Production (IIP) has shown a growth in the first quarter of 2010. As per the estimates of Asian Development Bank. Rise of Exports and Imports India has demonstrated a strong performance in its external trade ’s export and import has shown a strong growth in the past 9 months.opens up multiple plethora of investment opportunities for the foreign investors. In fact. Manufacturing sector alone has shown a growth of 17. after recovering from the worst of the global economic downturn. India’s imports rose to 43 percent in April 2010 from a year earlier to $27. India’s economic growth is again led by the manufacturing sector.3 billion.2 billion. Other non-oil imports grew by 34 percent in April to $19. Despite the strong performance and inflation near 10 percent. 4 The development of SEZs and the growth of the manufacturing sector are also likely to become the key drivers for the Indian economy. We believe that it is possible to move soon In fact the Government is hoping to do even better and move up to a double digit growth rate in the near future subsequent years by framing appropriate right policies and programs which promote the inclusive and sustainable growth. Asia's third-largest economy is targeting close to 15 percent export growth this year7. This is in sharp contrast to the sector’s performance in the previous three quarters of 2009 when the growth rate averaged less than 3%6.7 percent in the fiscal year 2009/10 as the global slowdown dampened demand. An Industrial Revolution India's manufacturing sector expanded at its fastest rate in more than two years in June 2010. India emerged as one of the world's top ten countries in industrial production as per UNIDO's new report titled 'Yearbook of Industrial Statistics 2010'. Brazil and Mexico in 2009 to reach the 9th position from the 12th position it held in 20088. India is projected to grow at 8.unidos. The Ccapital goods sector has seen a growth of 15% for the first quarter of 2010. The Finance Ministry has projected the growth rate of 8. India's exports dropped 4.

The Ggovernment is also planning to establish National Manufacturing and Investment Zones (NMIZs) to enhance the share of push the manufacturing share in gross domestic price (GDP). IT hardware. which has come into effect from April 1. India has the largest number of companies. the auto industry employs around 13 million people in direct and indirect jobs. India is fast emerging as a global manufacturing hub with a large number of companies shifting their manufacturing base to the country. IT. that have been recognised for excellence in quality. HSBC. and To enhance global competitiveness of the sector Auto Industry In the Indian economy. as it creates multiple positive spin-offs. Being one of the largest industries in India."The Indian economy is hardly pausing for breath. 2010. outside of Japan. as per the press release. This is benefiting the job market as more and more firms are hiring” said Frederic Neumann. Exports from special economic zones (SEZs) grew by over 122 per cent to US$ 49. Output growth remains at a robust pace and new orders continue to pour in.5 billion in 2009-10 as compared to 2008-09. the Indian automobile industry will create another five million direct and indirect jobs by 2012. The proposed National Manufacturing Policy for these NMIZs would act as the key enablers in driving the growth of the sector in India. Automobile industryIt has linkages with several key segments of the economy. Moreover. co-head of Asian Economics Research. By an estimate. engineering. Government Initiatives The government has issued the new Consolidated Foreign Direct Investment (FDI) policy document. the automotive industry has plays a very important role. petroleum. As many as 21 companies have received the Deming Excellence awards. In any economy a good transportation system plays a very important role for economic and industrial development. as per a press release by the Ministry of Commerce and Industry. inviting comments from all stakeholders in this regard. 153 companies have achieved Total Productive Maintenance (TPM) Excellence Award for their total productivity management practices by the Japan Institute of Plant Maintenance (JIPM) committee. This is in line with the Automotive Mission Plan to take the employment level to 3 . leather and garments are the leading exports from SEZs. The Mmain objectives of NMIZs are: • • • • To promote investments in the manufacturing sector and make the country a hub for both domestic and international markets To increase the sectoral share of manufacturing in GDP to 25 per cent by 2022 To double the current employment level in the sector. the government is working on launching a National Manufacturing Policy by the end of 2010 and has already circulated a discussion paper. it has a strong multiplier effect and is capable of being the driver of economic growth. Moreover.

The import of technology/technological upgradation on the royalty payment of 5% without any duration limit and lump sum payment of USD 2 million is also allowed under the automatic route in this sector. co-ordinate and synergisees the efforts of all stakeholders. The Aautomobile industry has witnessed the impressive growth in the last two decades and has been able to restructure itself with the changing global needs9. Drivers pushing India’s Automobile sector include: • • • • • • • • • Rising industrial and agricultural output Rising per capita income Favourable demographic distribution with rising working population and middle class Urbanisation Increasing disposable incomes in rural agri-sector Availability of a variety of vehicle models meeting diverse needs and preferences Greater affordability of vehicles Easy finance schemes Favourable government policies Robust production Key characteristics of India’s auto industry India's Position in World's Production • • • • • • • • • • Well-developed. Automotive Mission Plan 2016 The objective of the Automotive Mission Plan 2016 is Tto accelerate and sustain growth in the automotive sector and to steer. including the passenger car segment. At present 100% Foreign Direct Investment (FDI) is permissible under automatic route in this sector. With the gradual liberalization of the automobile sector since 1991. globally competitive auto ancillary industry Established automobile testing and R&D centers Among one of the lowest cost producers of steel in the world World's second largest manufacturer of two wheelers Fifth largest manufacturer of commercial vehicles Largest manufacturers of tractors in the world Fourth largest passenger car market in Asia India is the second largest two-wheeler market in the world 11th largest passenger car market in the world Expected to be the seventh largest auto industry by 2016 In India no industrial licence is required for setting up of any unit for manufacture of automobiles except in some special cases. 9 SIAM (Anything more specific? A report? Webstie URL? Department of Heavy Industries (provide URL) 10 4 . The norms for Foreign Investment and import of technology have also been progressively liberalized over the years for manufacture of vehicles including passenger cars in order to make this sector globally competitive. the number of manufacturing facilities in India has grown progressively10. Automotive Mission Plan (AMP) 2006-2016 has been prepared in order to make India a global automotive hub.around 25 million by 2016.

India provides trained manpower at competitive costs making India a favoured global manufacturing hub.org 5 . Production Provisional data released by the Ministry of Petroleum & Natural Gas. In the past few years. Ceat acquired 100 percent stake in its Sri Lankan investment arm ACHL. crude oil production went up to 5.89 MMT of crude oil was refined. In recent times. the employment has gone up and the spending power of Indians has increased. particularly two-wheelers or e-bikes. Pune-based Automotive Research Association of India (ARAI) and DSM of the Netherlands have entered into an alliance to develop new lighter materials that could substitute metals in the automotive industry. dated June 28. and help auto components shed weight12. India has emerged as one of the favourite investment destinations for automotive manufacturers. a 5.5 per cent increase over the corresponding period in 2009 During April-May 2010. The reason for the rapid growth of the automobile industry can be ascribed to is the growth of the Indian middle class. which attracted the global auto majors to the Indian market. Oil and gas industry has been refueling the growth the Indian economy. with the growth of Indian economy and the with the entryance of foreign companies in India.02 billion to fund its growth plans • • Road Ahead: By the year 20102 the market for electric vehicles. • • During April-May 2010. 26. This industry stops and the entire economy will stop.The Automotive Mission Plan (AMP) 2006-2016. two and three wheelers and auto components11. 2010.ibef. an increase of 8 per cent over the corresponding period in 2009 11 12 Automotive Component Manufactures Association of India www. aims at doubling the contribution of automotive sector in GDP by taking the turnover to USD 145 billion and providing additional employment to 25 million people by 2016 with special emphasis on export of small cars. South Korea-based Kia Motors plans to venture into Indian passenger car market Mercedes-Benz is planning to make the India its R&D hub Tata Motors planning to raise USD 1. Oil & Gas The oil and gas industry is critical to India’s growth as it helps fulfil the demand for energy that is needed to drive growth.82 MMT. MUVs. is expected to grow as the government is planning to provide incentives for manufacturing and buying these scooters. It is the most important of all the industries. Some key developments include: • • • Japan-based Denso Corp and Subros Ltd formed a joint venture is formed to manufacture products for domestic market.

1 BCM. will provide RNRL access to much needed fuel for its power projects.05 billion towards drilling costs over four years. GAIL to invest USD 2141 million in pipeline. which imports almost 75 percent of its crude needs.45 per cent over sales of 128. According to a press release by the Ministry of Petroleum and Natural Gas inIn 2009. RIL signs gas supply accord with RNRL which subject to approval from Government.95 MMT during 2007-08.4 MMT (including sales through private imports). RIL Buys 45 percent in US Shale Gas JV for USD 1. • Investments and Acquisitions • India auction of oil. • • • Telecom 13 14 Ministry of Petroleum www. The acquisition is part of RIL's bid to tap the growing market for non-conventional energy. gas blocks fetch USD 1. the government also announced a seven-year tax holiday for companies involved in commercial production of gas under NELP VIII & Coal Bed Methane (CBM) IV. kerosene. according to the Ministry of Petroleum14. had put 70 blocks for offer in its eighth round of New Exploration Licensing Policy (NELP).13 million tonne year-on-year. State promoted Gas Authority of India Limited (GAIL) plans to invest USD 2141 million to have major presence in South India with a 2. the actual natural gas production was 9. an increase of 3. FDI up to 100 per cent under the automatic route is permitted.8 per cent in April 2010 to 12. an increase of 43. The sale of oil products in the country rose 3.org 6 . for the oil sector which will focus on expanding the marketing network as well as quality of the products and services to customers covering four broad areas of LPG (liquefied petroleum gas). Government’s Vision-2015 approved in 2009.36 billion. Under the agreement the company will make a cash payment of USD 263 million for a 45 percent stake in US firm Pioneer's Eagle Ford shale acreage in South Texas.000 km gas pipeline.ibef. auto fuels and compressed natural gas/piped natural gas.1 billion (The country. The company will also contribute USD 1.• During April-May 2010. Government Initiatives • • For exploration of oil and natural gas fields.5 per cent over the corresponding period in 200913 Consumption The sales/consumption of petroleum products during 2008-09 were 133.

25 per cent hold of the company.19 per cent of the total valuation of the deals across all the sectors during the period analysed.930. the investment in the sector is likely to increase from the US$ 20 billion witnessed last year. Telenor has now completed its four-stage stake buy and has invested a total of US$ 1. The government has approved the foreign direct investment (FDI) proposal of the Federal Agency for State Property Management of the Russian Federation to buy 20 per cent stake in telecom service provider Sistema-Shyam for US$ 660. Going Global In March 2010. Norway-based telecom operator Telenor has bought a further 7 per cent in Unitech Wireless for a little over US$ 431. The cumulative flow of FDI in the sector during April 2000 and March 2010 is US$ 8.26 million by Reliance Industries. Telenor now has 67. its telecom tower business. 2010.61 million.05 million in April 201015. Telecommunications industry is one of the fastest growing in the world. for US$ 11 billion.3 million.Indian telecom industry has seen many fold growth in the past 5 years. which represented 67. Other major M&A deals included acquiring of Kuwait-based Zain telecom's African business for US$ 10. Number of telephone subscribers in India is 653. Major Investments India’s telecom sector has been attracting foreign companies to invest in.73 billion during April-June 2010. as per the Telecom Equipment and Services Export Promotion Council.7 billion by Bharti Airtel and acquisition of Infotel broadband for US$ 1032. According to the Department of Industrial Policy and Promotion (DIPP). Going ahead we are expecting to witness an investment of around US$ 40 billion. driving the Indian player into the league of top ten telecom players globally. The sector had seen M&A deals of around US$ 439.49 per cent from 638.7 billion. expansion of the current networks and widening of Broadband Wireless Access (BSA) network.1 million. The biggest M&A deal in the sector was made by Anil Ambani's Reliance Communication Ltd that merged GTL infrastructure Ltd. 3G Services The Department of Telecom (DOT) has taken the pioneering decision of launching of 3G services by BSNL and MTNL and initiation of process for auction of spectrum for 3G services to private operators.92 million as on May 31. an increase of 2. ascending e-auction process.4 million during April-June 2009. With the development of 3G. 15 TRAI 7 .32 billion in Unitech Wireless as agreed on with the latter last year.554 million. in the year 2009-10 telecom industry has attracted FDI’s worth t US$ 2. Allocation of spectrum for third-generation (3G) and broadband wireless access (BWA) services was done through a controlled simultaneous. Bharti Airtel bought the African operations of Kuwait-based Zain Telecom for US$ 10. As per an industry report the telecom industry witnessed merger and acquisition (M&A) deals worth US$ 22.

which are relevant to both rural and urban markets. growing at a CAGR of 14. about 6. 100 per cent FDI is permitted No cap on the number of access providers in any service area. 2009. This growth is poised to continue through the forecast period.7 per cent in 2009 to 63.3 per cent in the same period from 452 million in 2009.2 per cent at the end of December 2009. The Road Ahead According to a report published by Gartner Inc in June 2009.436 infrastructure sites spread over 500 districts in 27 states." said Madhusudan Gupta. The India mobile subscriber base is set to exceed 771 million connections by 2013.5 per cent in 2013.956 towers had been set up under the scheme.5 per cent from 2009-2013 to exceed US$ 30 billion.5 per cent of the rural phones as on December 31. according to Gartner. the total mobile services revenue in India is projected to grow at a compound annual growth rate (CAGR) of 12. 2009. and India is expected to remain the world's second largest wireless market after China in terms of mobile connections. Rural telephone connections have gone up from 12. "The Indian mobile industry has now moved out of its hyper growth mode. "Growth will also be triggered by increased adoption of valueadded services. The country has a 5. Rural Telephony In India rural telephony has increased for 1." Mobile market penetration is projected to increase from 38. but it will continue to grow at double-digit rates for next three years as operators focus on rural parts of the country.5 million in March 2009 and further to 174.6 million in December 2009. including:.3 million in March 2004 to 123. In 2008. date)?? 8 . India ranks fourth in manufacturing telecom equipment in the Asia-Pacific (Apac) region. 122 new Unified Access Service (UAS) licences were granted to 17 companies in 22 services areas of the country Revised subscriber based criteria for allocation of Global System of Mobile Communication (GSM) and Code Division Multiple Access (CDMA) spectra were issued in January 2008 To provide infrastructure support for mobile services a scheme has been launched to provide support for setting up and managing 7. • • • • In the area of telecom equipment manufacturing and provision of IT-enabled services. The private sector has contributed significantly to the growth of rural telephony by providing 81.2 per cent in March 2002 to 15.7 per cent share of the region's total telecom equipment production revenue of US$ 180 billion in 200916.1 per cent in March 2009 and further to 21. As on December 31. Policy Initiatives The Indian Government has taken several initiatives to boost the telecom industry. 16 Gartner Research Report (title.Manufacturing According to a report by technology researcher Gartner Inc. senior research analyst at Gartner.

The India China relationship These two ancient civilizations . the commercial satellite launch business is estimated at around $2. This robust growth in the bilateral trade and economic cooperation is all possible because of the concerted efforts of our honorable leaders. seriously looking at launching satellites from other countries. For both the economies. It is obvious that ISRO is making great strides in the space business. ISRO till date has launched 57 satellites (2 satellites will be launched on Aug. The future of technology lies in small satellites.5 billion. High level exchanges 17 18 ISRO India Today 9 . PSLV and GSLV. Netherlands. television broadcasting and meteorological services. both the countries provide tariff preference to each other. ISRO has developed two satellite launch vehicles. Space analysts feel that India will become a major player in the emerging small satellite manufacturing industry. opening a new source of income for the country in the international space market. Almost a year ago India and the US signed what is known asa Technology Safeguards Agreement (TSA). and two from Indonesia. Vikram Sarabhai. 2010). The ten foreign satellites that ISRO will launch come from Algeria. Globally. During the last three years. Further. and Indian Remote Sensing Satellites (IRS) system for resources monitoring and management. it has launched more than 20 satellites—mostly small satellites— for other countries and currently has orders for approximately ten more such launches18. Both the nations accorded most favored nation (MFN) status to each other in the year 1984.5 billion and growing rapidly over the next couple of years. Canada. In October 2008 too.China and India accounts for more than 40% of the total world population. the bilateral relations are the top most priority in their foreign policies. worth around $1. Singapore. to strengthen the relationship between the two countries in the area of space technology. During the last few years ISRO has built its reputation as a reliable satellite launch agency. Japan. China and India are the new economic powerhouses. ISRO has earned more than Rs 100 crore by undertaking commercial satellite launches.has attracted the world’s attention towards them especially in the past decade. abundant resources and huge domestic markets. 12.India in Space India has made remarkable growth in space industry ISRO (Indian Space Research Organisation) started its operations in 1960 under the guidance of Dr. INSAT for communication. ISRO has established two major space systems. The rapid growth of both the economies is grabbing center stage globally. In the current Of this wave of globalization. to place INSAT and IRS satellites in the required orbits17. under the Bangkok agreement. Small satellites are being continuously launched by ISRO both for India as well as for overseas clients in the last few years. Till date. India launched its Chandrayan-1 with payloads from different countries. They play a significant role in the global arena because of their vast pool of talented people. ISRO has estimated a market potential of 50 satellites over the next decade.

58%. non-traditional security threats. the trade between cChina and India has increased reached from USD2. Hence the Indian embassy has made plans to organize various business events in the main cities of China. The Indian Prime Minister Dr Manmohan SinghM and Premier Wen Jiabao signed a joint document on “A Shared Vision for the 21st Century between the Republic of India and the People’s Republic of China” in 2008 which signifies that Sino-Indian ties have gone beyond the bilateral context and acquired a global character. Indian IT can help Chinese companies to go global where as Indian pharmaceuticals will help the Chinese health care system to meet the increasing requirements. IT-enabled services and agricultural products to the huge Chinese market. SANY group has set up its manufacturing facility in Pune. India is looking forward to build its partnership with China in order to construct world class infrastructure. The trade targets set up by both the ministers in 2005 to touch bilateral USD 20 bn and USD 30 bn by 2008 and 2010 respectively have been met much ahead of the deadline. There exists congruence of interest between the two countries and both are willing to work together on regional and international issues related to the diversification of global energy mix. Recently. The 8th Ministerial level meeting of the India-China Joint Economic Group was held in Beijing on 19th January. 9 bn in 2007-08. the two countries developed a multiten --pronged strategy to strengthen their relationship. 2010.3 bn in 2001-02 to USD 37. Presidents and Prime Ministers. The main Chinese exports to India are electric machinery.India and China have maintained a healthy momentum in high level exchanges which includes frequent visits by the Foreign ministers. climate change. WTO. registering a CAGR of 53. Around three fourth of Indian exports to China comprises of commodities and raw materials like iron ore. (Refer Annexure 1 for more details) The numerous meetings are being held between the nations to take its business and trade relations to the next higher level.e. In November 2006. cheap electronic items. 2010 in which a MoU was signed on Expansion of Trade and Economic Cooperation. 2010. counter-terrorism. It is seeking help in its road and rail projects. Economic and Trade Relations India and China possess the world’s largest bilateral trading relationship which acts as a stabilizing force in Indian-Chinese relations. engineering goods. This year we are celebrating 60 years of the establishment of diplomatic relations. India and China signed an agreement to establish a hotline between the Prime Ministers of the two countries. The delegations are seeking access for Indian pharmaceuticals companies. Shandong Electric Power Construction Corporation. a unit of the State Grid Corp. arms control and disarmament. On April 7. On 9th April. As per the statistics of Directorate General of Foreign Trade (DGFT). inked $1. 10 .5 billion deal to build and operate three 660-MW generators in Orissa. Pharmaceuticals and specialized engineering. Many Chinese and Indian companies across sectors have established their offices in each other countries. Around 100 participants from both Chinese and Indian companies participated for the business networking session. In few years. human rights and South-South Co-operation. its relation. China has emerged as the largest trading partner of India and India occupied the 10 th position in the list of trading partners of China. The leading Chinese player in construction machinery industry i. and toys because of its low manufacturing costs. garments. The Indian Prime minster visit to China in 2003 and 2008 and Chinese Premier and President Visit to India in 2005 and 2006 have set the stage for both the nations to convert this century into Asian Century. the first business event took place in Xian organized by CII and CCPIT Shaanxi where Chinese companies were encouraged to leverage on the competitive advantages of Indian companies in sectors like IT.

In the beginning of this year. Expo Shanghai 2010 The 2010 World Exposition in Shanghai will be the first registered one in a developing country. The expo will also give foreign nations and companies an opportunity to build up business partnerships with China and Chinese companies. Hidden behind its veneer of an ancient temple are the tools of a technologically advanced sustainable future. climate change and energy security. the two countries are organizing a ‘Festival of India’ in China and a ‘Festival of China’ in India in 2010 as well. agreements and high level exchanges both the countries are making continuous attempts to reignite their diplomatic and economic ties. meetings. The dome links Indian and Chinese cultures through its Buddhist foundation. the last being held in 2009. This is the fifteenth in an ongoing series that will look at the upcoming expo. Regular exchange programmes are conducted for students. The pavilion is designed to be a “zero-chemicals zone. 11 . The Expo's theme of "Better City. but also major religions as a recurring architectural theme in Islamic. energy.” meaning it produces safe runoff containing no effluents. Defence Cooperation The close ties are even maintained in the field of defence. effectively symbolizing the harmony of all diverse religions and cultures. youths and Ministry of External Affairs. This was demonstrated can be proved by the fact thatwhen both the Prime Ministers held bilateral consultations with respect to the Copenhagen summit to ensure that the goal of developing countries are met while dealing with challenges of climate change. with its theme of “Cities of Harmony”. Christian. There are regular joint military exercises in order to combat terrorism. Hindu. thereby maintaining a healthy relationship for their economies to flourish. Frequent visits by high level delegations of the Navy and Air force often take place between the nations. To promote greater awareness of each others’ culture. from country pavilions to trade development. and Sikh architecture. Cooperation in other areas The two countries are co-operating each other in various areas like finance. They both extend hands assistance to each other when the cooperation is required on the global issues such as world trade negotiations. by extension also projects an international message of global unity.” which will last 184 days will provide China an opportunity to show off its remarkable economic growth. “Expo Shanghai 2010. Thus with regular conferences .However special focus on the trade and investment of knowledge based services is still required and the increasing bilateral investments can make substantive difference in their relationship. India’s Pavilion at the 2010 World Expo in Shanghai. and tourism and information technology by signing mutual agreements and MOUs. environment. especially relevant to India as the country experiences the natural growing pains of greater influence in Asia and abroad. the third defence dialogue was also conducted in China. It is worthy to note that efforts to build trust and confidence between the militaries of both the nations are proceeding satisfactorily. water resources. Better Life" gives a platform for a vast range of interpretations by the 189 countries and 57 international organizations which are participating. agriculture.

services and manufacturing continues at about 10-12% per annum.C. Our Indeed. To overcome greater conflict. For instance as per Investment Commission of India: • • 19 Over 225 million telephone subscribers. While its size and growth potential make India attractive as a market.Indian officials stress that India’s participation in the Shanghai Expo a total cost of US$50 million is purely rooted in a desire to broaden cultural and economic exchange. India’s Potential and Growth Story India’s is becoming the destination of choice for investors through its competitiveness from a natural and human resources standpoint.html 20 http://www.. rapidly growing disposable incomes are enhancing harmonize the enthusiasm of the average Indian to adopt the latest adapt to and learn global trends. India is in the global arena for increased foreign investment . By unifying on these issues. In the past 10 years. India is a fast-growing economy with a vibrant and robust financial system. http://www. India makes sure a stable policy environment and its independent institutions guarantee the rule of law.com/news/2010/04/30/shanghai-expo-2010-the-indianpavilion.both through the Equity markets .000 by 2015 (over US$30. The economic reforms since the early nineties have unleashed a new entrepreneurial spirit creating a vibrant economy supported by rising per capita income. the competition for more commodities and markets is certain to create diplomatic rowschallenges. diversity can live in harmony. Despite the drop.20 Increased availability and use of consumer finance and credit cards and.investmentcommission.a. and they peacefully coexisted for most of that time.8 billion before falling 16. Total China-India trade grew 34 percent in 2008 to US$51. Over 8 million TV sets and 4 million refrigerators are sold annually and expected to growth at 20% p.54 percent during the impact period of global financial crisis in 2009.000 in PPP* terms). Over 300 million Indians (63 million households) are expected to have a household income of over US$6.in 12 . between two of the world’s oldest civilizations date back thousands of years to at least the second century B. Driven by the demands of a humongous large population the market. India is experiencing a rapid growth in consumer spending.china-briefing. indicating a long history of shared relations and cooperation. for basic goods such as groceries and textiles is already huge. the most gripping compelling reason for investors to be in India is that it provides a high return on investment. the two countries will have to continue to concentrate on the greater mutual interests that bind them together in the face of difference and diverse thought.19 As the world’s two fastest growing economies extend their geopolitical power. cultural ties. China remains India’s largest trading partner and a key economic ally. This has led to the creation of a swiftly growing consumer base and one of the world’s largest markets for manufactured goods and services. Other products markets are equally enormous and growing quickly. growing at over approximately 75 million per annum. As a democratic nation. thriving bilateral trade has been the driving force improving relations as India and China cooperate on key issues like climate change and global trade. Growth in key sectors like infrastructure.termed Foreign Institutional Investment (FII) and Foreign Direct Investment (FDI).

insurance companies. this was only 4.22 Tourism in India As per the Travel and Tourism Competitiveness Report 2009 by the World Economic Forum. English is the language of business in India and the large English-speaking workforce is a benefit to investors and employers. Yoga. and venture capital and investment institutions. Russia. centers of pilgrimage for spiritual tourism. the Reserve Bank of India reduced interest rates and cash reserve ratios considerably and also launched stimulus packages to sustain growth. India is a state known for its generous hospitable conduct to all visitors. moving up three places on the list of the world's attractive destinations. forests and wild life and landscapes for eco-tourism. varied life styles and cultural heritage and colourful fairs and festivals hoeld abiding attractions for allthe tourists. snow. Further. can be attributed to thisis its workforce which is the world’s youngest. India’s New Opportunity – 2020 13 . This will take India's GDP growth to 10% by 2020. the number of Indians who know English is more than the population of the USA. carpets. Marketing efforts to promote the India brand to international markets also increased during 2009. ivory and brass work are the main shopping items of foreign tourists. The Indian handicrafts above all. India’s healthy and vibrant financial sector. regardless of where they come from. India’s diverse cultural heritage puts its citizens at ease with people from other cultures and vice versa.2 million.investmentcommission. river and mountain peaks for adventure tourism. It has also observed increased private sector activity including an explosion of foreign banks. In fact. technological parks and science museums for science tourism. One of the factors making that enhance India’s attractiveness as an investment destination. Initiatives by the government support tourism in turbulent times. skilled and ambitious workforce. India will see 70 million new entrants to its workforce over the next 5 years. The other attractions include beautiful beaches.the largest among in the world of the BRIC (Brazil. India’s Demographic Advantage .India’s human capital is hallmarked by an unmatched resource of an educated. In 1998-99.During 2009. leather goods. Its visitor-friendly traditions. with the year being 21 22 http://www. heritage trains and hotels for heritage tourism. hard-working. India is projected to stay the youngest with its working-age population estimated to rise to 70% of the total demographic by 2030 . To counterbalance the stress of the economic downturn. India is ranked 11th in the Asia Pacific region and 62ndoverall. the government.India’s financial sector has been one of the fastest growing and soundly insulated sectors in the economy.in Report Of The High Level Strategic Group (Consulting Partner The Boston Consulting Group). up from 8. together with Ministry of Tourism assumed numerous programs to help the country’s ailing tourism industry.21 The poorer Indian states will start catching up with the richer ones. ayurveda and natural health resorts also attract tourists. India has been ranked 1st by AT Kearney in a Global Retail Development Index of 30 developing countries and is seen as a potential gold mine.6 million in 2004-05. India and China) countries. One of the highlights of India’s financial sector is that it has the largest number of listed companies across 23 Stock Exchanges and the third largest investor base in the world. jewellery. mutual funds.• Total production of vehicles has crossed 11 million in 2006-07.

However. India already is one of the largest economies in the world with a high GDP growth rate and is poised to overtake the world’s largest economies in the next 25-30 years. and use of municipal waste to generate electricity. which are being held in Delhi. is a swanky steel-and-glass structure. India’s Inclusive Growth ‘Inclusive Growth’ is both the title and the overarching goal of the Eleventh Five Year Plan of India. The report also states that real GDP growth for travel and tourism economy is expected to achieve an average of 7. The Road Ahead for Tourism According to the Travel & Tourism Competitiveness Report 2009 brought out by the World Economic Forum. having eco-friendly features like energy-efficient buildings. The games are expected to give a boost to Indian tourism. finance or education it is important to seek solutions for a social change and engage all the growth factors to increase social inclusion.2 per cent between 2010 and 2019 and will place India at the third position in the world. 23 Be it agriculture. Though the development process is running behind schedule. The key component of government’s ‘strategy of inclusive growth’ is inclusive governance as the means of empowering the disadvantaged. It has made efforts to boost tourism in the country and formulated specific policies to aid developments related to the Commonwealth Games.3 billion by 2019. It also exemplifies our country’s resolve to bridge fast the infrastructure deficit. Further according to the Tourism Satellite Accounting (TSA) research. This airport terminal establishes new global standards. 23 Commonwealth Journal of Local Governance Issue 2: January 2009 14 . 2010 Honourable Prime Minister Mr. with the aim of enabling them to overcome their poverty. the contribution of travel and tourism to gross domestic product (GDP) is expected to be at US$ 187. Commonwealth Games at the top of the agenda The government is highly focused on making the 2010 Commonwealth Games. released by WTTC and its strategic partner Oxford Economics in March 2009.7 per cent per annum over the next 10 years.000 crore. and is the world’s sixth-largest terminal built at a cost of Rs 9. a huge success. tThe Terminal 3 or T3. rain water harvesting. The New Terminal 3 at Delhi Airport.Putting India on Runway to Future On 3 July. the government made security checks in the country even more stringent. Commonwealth Games to be held in the Capital in October. there are many more still to participate in the country’s growth. high-performance air-conditioning. waste-water treatment and reuse of treated water. the demand for travel and tourism in India is expected to grow by 8. T3 will be one of the few green airports in the world. resulting in strong value and volume growth. the government is optimistic that all the deadlines for the games will be met. built by the GMR-led consortium Delhi International Airport (DIAL) in a record 37 months. Manmohan Singh dedicated to the nation an ultra-modern airport terminal at the Indira Gandhi International airport in Delhi. and that the city will be equipped with world class facilities. and formulated policies to ensure the safety of tourists in India. Furthermore. with tourist security a major concern.designated “Visit India” year.

introduction of Business Correspondent (BC) /Business Facilitator (BF) model. local governments. It would not be incorrect to say that public-private-partnerships are the future. promotion of financial literacy. With both the industry and the services sector growing at a rapid speed than ever before. international organizations. technology and investment.For inclusive growth it is imperative that both public and private sectors come forward and contribute. In area of Financial inclusion. NGOs. setting up of Kiosks in rural areas for farmers which contain PCs that help deliver information and connectivity to villages where Microsoft India has been a major contributor. The players to be included in this enormous task – and who need to be included in all major national programmes – are national governments. 15 . for instance in area of Digital inclusion. and adoption of Information and Communication Technology solutions for achieving greater outreach. In the times to come India will be emerge as a more integrated economy with the global economy and will be a major player in terms of trade. with its young population there will be no looking back for India. To successfully address the challenge of achieving inclusive growth. will require mobilization of all possible stakeholders. other indicators like the capital markets. rising levels of education. domestic enterprises. foreign trade and FDI – too underline India’s growth story. Conclusion India’s economy is at the fulcrum of an ever increasing growth curve. Reserve Bank of India has taken several measures for promoting financial inclusion such as advising banks to open ‘no frills’ accounts. Last but not the least. entrepreneurs. multinational corporations. employment and income which will help stabilize its internal security and social environment. foreign exchange reserves. academia and the media. There have been efforts in various areas both by public and private sector players.

Annexure 1 16 .

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