Country Analysis Brief: India
Source: Energy Information Administration
India was the fourth-largest energy consumer in the world after China, the United States, and Russia in 2011, and its need for energy supply continues to climb as a result of the country’s dynamic economic growth and modernization over the past several years. India’s economy has grown at an average annual rate of approximately 7% since 2000, and it proved relatively resilient following the 2008 global financial crisis.
The latest slowdown in growth of emerging market countries and higher inflation levels, combined with domestic supply and infrastructure constraints, have reduced India’s annual inflation-adjusted gross domestic product (GDP) growth from a high of 10.3% in 2010 to 4.4% in 2013, according to the International Monetary Fund (IMF). India was the third-largest economy in the world in 2013, as measured on a purchasing power parity basis. Risks to economic growth in India include high debt levels, infrastructure deficiencies, delays in structural reforms, and political polarization between the country’s two largest political parties, the Indian National Congress and the Bharatiya Janata Party (BJP).
Managing Corruption Risks in India
In the past few years, India has emerged as one of the most promising destinations for investments. Its democratic government and large economy in terms of purchase power parity, highly skilled workforce, growing domestic market and sizeable English-speaking population, has resulted in an increasing number of global investors. According to a recent survey conducted by United Nations Conference on Trade and Development (UNCTAD), India has been ranked as the third most attractive destination for investments by transnational companies. In addition, the United States is one of India’s largest investment and trade partners and both countries are currently negotiating a bilateral investment treaty as part of their effort to strengthen their mutual economic ties and enhance investor confidence.
While India presents increasing investment opportunities, foreign companies in India face some unique challenges. This article focuses mainly on the corruption landscape in India, several associated risks and the need for implementing an effective anti-corruption compliance program in India.
India’s Higher Education System
Source: Martin Prosperity Institute
From at least the 5th century CE, India has been home to institutions of higher education. When India achieved independence in 1947, it had 20 universities and 500 colleges. It now boasts one of the largest higher education systems in the world with over 42,000 institutions of higher learning. This paper identifies and discusses five different dimensions across which the higher education system in India can be considered. These dimensions are governance, financing, level of degree awarded, program differentiation, and language. Along with definition and specification of these dimensions, some of the key challenges facing higher education in India are presented. This paper only focuses on the system of ‘higher’ education which is supported and regulated by the two senior levels of government, which are the central or federal government and the state governments. The current challenges include both quantity and quality of education, availability of higher education for traditionally under-represented groups, and moving India from ‘mass’ to ‘universal’ access. A brief summary of the 12th (current; 2012-17) Five-Year Plan for education depicts the Central government’s approach to these issues.
Global Economic Outlook Q2 2014
The second quarter edition of the Global Economic Outlook offers timely insights from Deloitte Research economists about the Eurozone, China, the United States, Japan, India, Russia, Brazil, and the United Kingdom. In addition, this issue’s special topic considers the revival in international trade and the resurgence of bilateralism.
Upscale Millennials represent the future of economic growth and prosperity. These consumers are a subset of the Millennial generation with household incomes over the 75th percentile in their countries—that means households earning $30,000 or more in India and above $70,000 in the U.S.
This young segment of the population is actively saving and investing, and these consumers feel confident in their financial futures. In contrast to the global population, the proportion of upscale Millennials actively saving exceeds future savings intentions in areas reflective of their lifestage like higher education and a first-home purchase. And they’re devoting a larger portion of their monthly income to savings than the general Millennial population. Financial institutions should look to consumer sentiment and savings intentions country by country to develop strategies to educate and connect with upscale Millennials. In an effort to better understand this group and its consumer prowess, Nielsen conducted a study across the U.S., China, India and Brazil to learn about their financial plans and aspirations.
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Asia Pacific Economic Outlook — April 2014
This edition gives a near-term outlook for China, India, Malaysia, and Vietnam. Concerns about the level of debt in China continue, while India’s growth outlook will primarily hinge on the upcoming election’s outcome. Malaysia’s economy faces concerns of high household debt and a potential housing bubble. Investors consider Vietnam’s consumer price index improvement its biggest achievement of 2013.
The Indian Economy at a Crossroads
Source: Information Technology and Innovation Foundation
Indian economic growth in 2014 is expected to come in at less than 5 percent—the lowest level in over a decade—potentially signaling the end to 20 years of robust economic development often known as the “Indian Economic Miracle.” While the recent global economic downturn has played a part, a major factor in India’s economic slowdown has been the loss of momentum for continued economic and trade liberalizing reforms. In recent years this has been replaced by an economic development approach that has prioritized expanding domestic manufacturing and import substitution rather than across-the-board productivity growth, which has in part contributed to India’s recent embrace of several trade-distorting “innovation mercantilist” policies.
With national elections now underway, this report details the evolution of India’s post-independence economic policies and explains how the liberalizing reforms of the early 1990s spurred two decades of turbocharged growth. It explains how that success is increasingly threatened by innovation mercantilist policies—such as Preferential Market Access (PMA) rules for government procurement of ICT products and compulsory licensing of biopharmaceutical intellectual property—designed to promote selected domestic industries, even at the expense of other Indian industries and Indian consumers. But while such policies may seem beneficial in the short-term, they will ultimately prove counterproductive, by hampering domestic productivity, lessening India’s attractiveness to foreign direct investment (FDI), and potentially leading to retaliatory measures by other nations that would imperil the global trading system.
Poverty and Crime: Evidence from Rainfall and Trade Shocks in India
Source: Harvard Business School Working Papers
Does poverty lead to crime? We shed light on this question using two independent and exogenous shocks to household income in rural India: the dramatic reduction in import tariffs in the early 1990s and rainfall variations. We find that trade shocks, previously shown to raise relative poverty, also increased the incidence of violent crimes and property crimes. The relationship between trade shocks and crime is similar to the observed relationship between rainfall shocks and crime. Our results thus identify a causal effect of poverty on crime. They also lend credence to a large literature on the effects of weather shocks on crime and conflict, which has usually assumed that the income channel is the most relevant one.
The G20: a quick guide
Source: Parliamentary Library of Australia
This is a quick guide to basic information about the G20, as well as links to useful summary resources. The G20 background section includes the G20’s history, its members, the hosting system and G20 meeting processes, as well as a brief discussion of selected policy areas. Material on Australia and the G20 includes Australia’s involvement in the G20, Australia’s G20 goals for 2014 and speeches and press releases on the G20. A short list of links provides access to more resources on the G20.
“Donkey Flights”: Illegal Immigration from the Punjab to the United Kingdom (PDF)
Source: Migration Policy Institute
The facilitation of illegal immigration is big business in India. One method being used to exploit immigration loopholes, explored in this report, is referred to as “donkey flights”—the practice of Indian migrants obtaining a tourist visa for a Schengen-zone country in order to enter the United Kingdom through the back door via other European countries.
How Does India Innovate?
Innovation isn’t easy. Globally, at least 90 percent of new product introductions fail in the year they launch. India is often viewed as a hotbed of innovation, but truth be told, the odds of launching a breakthrough success in this market may not be meaningfully better than anywhere else in the world. And the landscape is highly competitive. In looking at more than 14,000 launches in the fast-moving consumer goods (FMCG) sector in 2011 for India, Nielsen deemed fewer than 40 as true breakthrough innovations.
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Backgrounder — Governance in India: Corruption
Source: Council on Foreign Relations
With a booming economy throughout the 2000s, India was touted as one of the most promising major emerging markets. But that breakneck growth sputtered to a decade low in 2012, with many observers pointing to the corrosive effect of endemic corruption—including a spate of scandals under Prime Minister Manmohan Singh—as a culprit. Perhaps more than India’s weak currency and rising inflation, the graft problem has undermined institutions and thwarted efforts to reduce poverty and catalyze sustainable growth in the world’s largest democracy. Public revelations of corruption, including major scandals in the telecommunications and coal industry, have galvanized a rising middle class with increased demands for better governance. The tide has spurred new political movements, and forced Prime Minister Singh’s Congress Party to address transparency and marshal reforms. As the country enters a busy political season, culminating in the 2014 general elections, corruption is expected be a cornerstone issue—and one with big implications for India’s development.