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


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. In fact. 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.2% in 2010-11 and 8. Other non-oil imports grew by 34 percent in April to $19.unidos. many economists and traders expect worries about the euro zone debt crisis. An Industrial Revolution India's manufacturing sector expanded at its fastest rate in more than two years in June 2010. respectively. Brazil and Mexico in 2009 to reach the 9th position from the 12th position it held in 20088.7 percent in the fiscal year 2009/10 as the global slowdown dampened demand. India's exports dropped 4. Despite the strong performance and inflation near 10 percent. 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. India’s imports rose to 43 percent in April 2010 from a year earlier to $ 2 . 4 The development of SEZs and the growth of the manufacturing sector are also likely to become the key drivers for the Indian economy. Asia's third-largest economy is targeting close to 15 percent export growth this year7. 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. we even feel proud to say that India surpassed Canada.3 billion. India is projected to grow at 8. Manufacturing sector alone has shown a growth of 17.7% in 2011-12. India is also expected to become the third largest economy in the world by purchasing power parity by 2012. 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'.opens up multiple plethora of investment opportunities for the foreign investors. India’s economic growth is again led by the manufacturing sector. The Ccapital goods sector has seen a growth of 15% for the first quarter of 2010. after recovering from the worst of the global economic downturn.9 % in the first quarter of 2010 as against 1% in the first quarter of 2009. Manufacturing in India accounts for the 80% of the Index of Industrial Production5. The Index of Industrial Production (IIP) has shown a growth in the first quarter of 2010. The Finance Ministry has projected the growth rate of 8.5% and 9% for 2010-11 and 2011-12.2 billion. As per the estimates of Asian Development Bank.

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

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. including the passenger car segment. 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.around 25 million by 2016. With the gradual liberalization of the automobile sector since 1991. At present 100% Foreign Direct Investment (FDI) is permissible under automatic route in this sector. 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 (AMP) 2006-2016 has been prepared in order to make India a global automotive hub. 9 SIAM (Anything more specific? A report? Webstie URL? Department of Heavy Industries (provide URL) 10 4 . 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. the number of manufacturing facilities in India has grown progressively10. 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. 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.

dated June 28. In the past few years. MUVs. with the growth of Indian economy and the with the entryance of foreign companies in India. crude oil production went up to 5. two and three wheelers and auto components11. is expected to grow as the government is planning to provide incentives for manufacturing and buying these scooters. 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. • • During April-May 2010.89 MMT of crude oil was refined.82 MMT. 2010. which attracted the global auto majors to the Indian market. Ceat acquired 100 percent stake in its Sri Lankan investment arm ACHL. 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. Some key developments include: • • • Japan-based Denso Corp and Subros Ltd formed a joint venture is formed to manufacture products for domestic market. In recent times. Production Provisional data released by the Ministry of Petroleum & Natural Gas. 26. particularly two-wheelers or e-bikes. 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. It is the most important of all the industries. a 5. This industry stops and the entire economy will stop. The reason for the rapid growth of the automobile industry can be ascribed to is the growth of the Indian middle class. Oil and gas industry has been refueling the growth the Indian 5 . 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. India has emerged as one of the favourite investment destinations for automotive manufacturers.ibef.02 billion to fund its growth plans • • Road Ahead: By the year 20102 the market for electric vehicles. India provides trained manpower at competitive costs making India a favoured global manufacturing hub.5 per cent increase over the corresponding period in 2009 During April-May 2010.The Automotive Mission Plan (AMP) 2006-2016. the employment has gone up and the spending power of Indians has increased. and help auto components shed weight12.

• Investments and Acquisitions • India auction of oil. The sale of oil products in the country rose 3. 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. 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 2009.13 million tonne year-on-year.36 billion.45 per cent over sales of 128.ibef.8 per cent in April 2010 to 12.000 km gas pipeline. auto fuels and compressed natural gas/piped natural gas. State promoted Gas Authority of India Limited (GAIL) plans to invest USD 2141 million to have major presence in South India with a 2. According to a press release by the Ministry of Petroleum and Natural Gas inIn 2009.1 BCM. which imports almost 75 percent of its crude needs. an increase of 43.5 per cent over the corresponding period in 200913 Consumption The sales/consumption of petroleum products during 2008-09 were 133.95 MMT during 2007-08. will provide RNRL access to much needed fuel for its power projects. RIL Buys 45 percent in US Shale Gas JV for USD 1. • • • Telecom 13 14 Ministry of Petroleum www.• During April-May 2010. 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. FDI up to 100 per cent under the automatic route is 6 . had put 70 blocks for offer in its eighth round of New Exploration Licensing Policy (NELP).05 billion towards drilling costs over four years. GAIL to invest USD 2141 million in pipeline. an increase of 3. kerosene.4 MMT (including sales through private imports). The company will also contribute USD 1. RIL signs gas supply accord with RNRL which subject to approval from Government.1 billion (The country. the actual natural gas production was 9. gas blocks fetch USD 1. The acquisition is part of RIL's bid to tap the growing market for non-conventional energy. according to the Ministry of Petroleum14. Government Initiatives • • For exploration of oil and natural gas fields.

Number of telephone subscribers in India is 653.7 billion by Bharti Airtel and acquisition of Infotel broadband for US$ 1032. 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. According to the Department of Industrial Policy and Promotion (DIPP). which represented 67. expansion of the current networks and widening of Broadband Wireless Access (BSA) network.554 million. driving the Indian player into the league of top ten telecom players globally. its telecom tower business.25 per cent hold of the company.32 billion in Unitech Wireless as agreed on with the latter last year. Telenor now has 67. 15 TRAI 7 . Major Investments India’s telecom sector has been attracting foreign companies to invest in.73 billion during April-June 2010. The sector had seen M&A deals of around US$ 439. Going ahead we are expecting to witness an investment of around US$ 40 billion. as per the Telecom Equipment and Services Export Promotion Council. for US$ 11 billion.Indian telecom industry has seen many fold growth in the past 5 years. ascending e-auction process. Going Global In March 2010.61 million. Bharti Airtel bought the African operations of Kuwait-based Zain Telecom for US$ 10. an increase of 2.19 per cent of the total valuation of the deals across all the sectors during the period analysed.1 million. As per an industry report the telecom industry witnessed merger and acquisition (M&A) deals worth US$ 22. The cumulative flow of FDI in the sector during April 2000 and March 2010 is US$ 8. Allocation of spectrum for third-generation (3G) and broadband wireless access (BWA) services was done through a controlled simultaneous. Norway-based telecom operator Telenor has bought a further 7 per cent in Unitech Wireless for a little over US$ 431.49 per cent from 638.92 million as on May 31. 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. Other major M&A deals included acquiring of Kuwait-based Zain telecom's African business for US$ 10. Telenor has now completed its four-stage stake buy and has invested a total of US$ 1.3 million.7 billion. 2010. the investment in the sector is likely to increase from the US$ 20 billion witnessed last year. in the year 2009-10 telecom industry has attracted FDI’s worth t US$ 2.930.26 million by Reliance Industries. With the development of 3G. The biggest M&A deal in the sector was made by Anil Ambani's Reliance Communication Ltd that merged GTL infrastructure Ltd.4 million during April-June 2009.05 million in April 201015. Telecommunications industry is one of the fastest growing in the world.

about 6.Manufacturing According to a report by technology researcher Gartner Inc. The India mobile subscriber base is set to exceed 771 million connections by 2013. growing at a CAGR of 14. senior research analyst at Gartner. 16 Gartner Research Report (title.7 per cent share of the region's total telecom equipment production revenue of US$ 180 billion in 200916.956 towers had been set up under the scheme. the total mobile services revenue in India is projected to grow at a compound annual growth rate (CAGR) of 12.3 million in March 2004 to 123. including:.6 million in December 2009. The country has a 5. which are relevant to both rural and urban markets. "Growth will also be triggered by increased adoption of valueadded services." said Madhusudan Gupta.5 per cent in 2013. Policy Initiatives The Indian Government has taken several initiatives to boost the telecom industry. and India is expected to remain the world's second largest wireless market after China in terms of mobile connections.5 per cent from 2009-2013 to exceed US$ 30 billion. India ranks fourth in manufacturing telecom equipment in the Asia-Pacific (Apac) region. 2009.2 per cent at the end of December 2009.1 per cent in March 2009 and further to 21.5 million in March 2009 and further to 174.2 per cent in March 2002 to 15. The Road Ahead According to a report published by Gartner Inc in June 2009.7 per cent in 2009 to 63. according to Gartner. This growth is poised to continue through the forecast period.5 per cent of the rural phones as on December 31. 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 2008. 2009.436 infrastructure sites spread over 500 districts in 27 states. date)?? 8 . "The Indian mobile industry has now moved out of its hyper growth mode. • • • • In the area of telecom equipment manufacturing and provision of IT-enabled services." Mobile market penetration is projected to increase from 38. 100 per cent FDI is permitted No cap on the number of access providers in any service area. Rural telephone connections have gone up from 12. Rural Telephony In India rural telephony has increased for 1.3 per cent in the same period from 452 million in 2009. As on December 31. The private sector has contributed significantly to the growth of rural telephony by providing 81. but it will continue to grow at double-digit rates for next three years as operators focus on rural parts of the country.

12. worth around $1. both the countries provide tariff preference to each other. For both the economies. 2010).5 billion. Both the nations accorded most favored nation (MFN) status to each other in the year 1984. the commercial satellite launch business is estimated at around $2. Almost a year ago India and the US signed what is known asa Technology Safeguards Agreement (TSA). This robust growth in the bilateral trade and economic cooperation is all possible because of the concerted efforts of our honorable leaders. Small satellites are being continuously launched by ISRO both for India as well as for overseas clients in the last few years. The India China relationship These two ancient civilizations . seriously looking at launching satellites from other countries. it has launched more than 20 satellites—mostly small satellites— for other countries and currently has orders for approximately ten more such launches18. In October 2008 too. abundant resources and huge domestic markets. to strengthen the relationship between the two countries in the area of space technology. India launched its Chandrayan-1 with payloads from different countries. In the current Of this wave of globalization. It is obvious that ISRO is making great strides in the space business. Further. During the last three years. Vikram Sarabhai. and two from Indonesia. The ten foreign satellites that ISRO will launch come from Algeria. Netherlands. ISRO has earned more than Rs 100 crore by undertaking commercial satellite launches. ISRO has established two major space systems. Till date. to place INSAT and IRS satellites in the required orbits17. The future of technology lies in small satellites. The rapid growth of both the economies is grabbing center stage globally. ISRO till date has launched 57 satellites (2 satellites will be launched on Aug.has attracted the world’s attention towards them especially in the past decade. ISRO has estimated a market potential of 50 satellites over the next decade. High level exchanges 17 18 ISRO India Today 9 .China and India accounts for more than 40% of the total world population. opening a new source of income for the country in the international space market. China and India are the new economic powerhouses. Space analysts feel that India will become a major player in the emerging small satellite manufacturing industry.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. PSLV and GSLV. Canada. They play a significant role in the global arena because of their vast pool of talented people. and Indian Remote Sensing Satellites (IRS) system for resources monitoring and management. under the Bangkok agreement. INSAT for communication.5 billion and growing rapidly over the next couple of years. Singapore. television broadcasting and meteorological services. During the last few years ISRO has built its reputation as a reliable satellite launch agency. Japan. ISRO has developed two satellite launch vehicles. Globally. the bilateral relations are the top most priority in their foreign policies.

This year we are celebrating 60 years of the establishment of diplomatic relations. Around 100 participants from both Chinese and Indian companies participated for the business networking session. 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. Presidents and Prime Ministers. On April 7. Hence the Indian embassy has made plans to organize various business events in the main cities of China. 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. a unit of the State Grid Corp. cheap electronic items. India and China signed an agreement to establish a hotline between the Prime Ministers of the two countries. WTO. counter-terrorism. Pharmaceuticals and specialized engineering. 10 . 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. inked $1. In few years. 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.India and China have maintained a healthy momentum in high level exchanges which includes frequent visits by the Foreign ministers. 9 bn in 2007-08. (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.3 bn in 2001-02 to USD 37. engineering goods. non-traditional security threats. 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. It is seeking help in its road and rail projects. 2010. 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. In November 2006. and toys because of its low manufacturing costs. climate change.5 billion deal to build and operate three 660-MW generators in Orissa. garments. The main Chinese exports to India are electric machinery. the trade between cChina and India has increased reached from USD2. The leading Chinese player in construction machinery industry i. Around three fourth of Indian exports to China comprises of commodities and raw materials like iron ore. the two countries developed a multiten --pronged strategy to strengthen their relationship. human rights and South-South Co-operation. 2010. 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. As per the statistics of Directorate General of Foreign Trade (DGFT).58%. India is looking forward to build its partnership with China in order to construct world class infrastructure. The 8th Ministerial level meeting of the India-China Joint Economic Group was held in Beijing on 19th January. Many Chinese and Indian companies across sectors have established their offices in each other countries. 2010 in which a MoU was signed on Expansion of Trade and Economic Cooperation. On 9th April. arms control and disarmament. The delegations are seeking access for Indian pharmaceuticals companies. 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.e. SANY group has set up its manufacturing facility in Pune. its relation. IT-enabled services and agricultural products to the huge Chinese market. Shandong Electric Power Construction Corporation. registering a CAGR of 53.

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

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.54 percent during the impact period of global financial crisis in 2009.both through the Equity markets .china-briefing.000 by 2015 (over US$30. Despite the drop. the competition for more commodities and markets is certain to create diplomatic rowschallenges. Driven by the demands of a humongous large population the market. By unifying on these cultural ties. Other products markets are equally enormous and growing quickly. To overcome greater conflict. India is a fast-growing economy with a vibrant and robust financial system.8 billion before falling 16. While its size and growth potential make India attractive as a market. India is in the global arena for increased foreign investment .a. Our Indeed.000 in PPP* terms). India makes sure a stable policy environment and its independent institutions guarantee the rule of law.investmentcommission.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. China remains India’s largest trading partner and a key economic ally. Growth in key sectors like infrastructure. growing at over approximately 75 million per annum. rapidly growing disposable incomes are enhancing harmonize the enthusiasm of the average Indian to adopt the latest adapt to and learn global trends. services and manufacturing continues at about 10-12% per annum.19 As the world’s two fastest growing economies extend their geopolitical power. 12 . 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. Over 300 million Indians (63 million households) are expected to have a household income of over US$6. Total China-India trade grew 34 percent in 2008 to US$51. diversity can live in harmony. Over 8 million TV sets and 4 million refrigerators are sold annually and expected to growth at 20% p. between two of the world’s oldest civilizations date back thousands of years to at least the second century B. for basic goods such as groceries and textiles is already huge.html 20 http://www. thriving bilateral trade has been the driving force improving relations as India and China cooperate on key issues like climate change and global trade. For instance as per Investment Commission of India: • • 19 Over 225 million telephone subscribers. indicating a long history of shared relations and cooperation. India is experiencing a rapid growth in consumer spending. As a democratic nation. The economic reforms since the early nineties have unleashed a new entrepreneurial spirit creating a vibrant economy supported by rising per capita income. In the past 10 years. the most gripping compelling reason for investors to be in India is that it provides a high return on investment.termed Foreign Institutional Investment (FII) and Foreign Direct Investment (FDI).20 Increased availability and use of consumer finance and credit cards and. 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.. and they peacefully coexisted for most of that time.

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. regardless of where they come from. It has also observed increased private sector activity including an explosion of foreign banks. India’s Demographic Advantage . snow. English is the language of business in India and the large English-speaking workforce is a benefit to investors and employers. Its visitor-friendly traditions. Initiatives by the government support tourism in turbulent times. 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.• Total production of vehicles has crossed 11 million in 2006-07. ivory and brass work are the main shopping items of foreign tourists. The Indian handicrafts above all. and venture capital and investment institutions. Russia.India’s human capital is hallmarked by an unmatched resource of an educated. mutual funds. India’s healthy and vibrant financial sector. hard-working. forests and wild life and landscapes for eco-tourism.the largest among in the world of the BRIC (Brazil.6 million in 2004-05. Yoga. The other attractions include beautiful beaches. India is projected to stay the youngest with its working-age population estimated to rise to 70% of the total demographic by 2030 . the Reserve Bank of India reduced interest rates and cash reserve ratios considerably and also launched stimulus packages to sustain growth.During 2009. Marketing efforts to promote the India brand to international markets also increased during 2009. India and China) countries. India will see 70 million new entrants to its workforce over the next 5 years. together with Ministry of Tourism assumed numerous programs to help the country’s ailing tourism industry. leather goods.21 The poorer Indian states will start catching up with the richer ones. In fact. To counterbalance the stress of the economic downturn. the government. India is a state known for its generous hospitable conduct to all visitors. centers of pilgrimage for spiritual Report Of The High Level Strategic Group (Consulting Partner The Boston Consulting Group). the number of Indians who know English is more than the population of the USA. technological parks and science museums for science tourism. varied life styles and cultural heritage and colourful fairs and festivals hoeld abiding attractions for allthe tourists. with the year being 21 22 http://www.22 Tourism in India As per the Travel and Tourism Competitiveness Report 2009 by the World Economic Forum.investmentcommission. In 1998-99. moving up three places on the list of the world's attractive destinations. up from 8. skilled and ambitious workforce. insurance companies. One of the factors making that enhance India’s attractiveness as an investment destination. India is ranked 11th in the Asia Pacific region and 62ndoverall. carpets. India’s diverse cultural heritage puts its citizens at ease with people from other cultures and vice versa. India’s New Opportunity – 2020 13 .India’s financial sector has been one of the fastest growing and soundly insulated sectors in the economy. this was only 4. can be attributed to thisis its workforce which is the world’s youngest. ayurveda and natural health resorts also attract tourists. jewellery. river and mountain peaks for adventure tourism. Further. This will take India's GDP growth to 10% by 2020. heritage trains and hotels for heritage tourism.2 million.

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

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

Annexure 1 16 .

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