Professor Joseph Stiglitz – Nobel Prize winner for Economics of Information – gives some useful insights on what could be useful in the growth of India.
He also warned on globallization and how it will affect India…
A decline in tariff leads to less money for the governments to spend on its people
He also thinks that India’s growth was more due to Internal Process/Structural improvements as opposed to benefits of Globalization:
Professor Stiglitz said globalisation had played an important trigger in the buoyant Indian economy – it grew at over 9% in the six months to this September. But he said it had been given too much credit for the growth.
“Much of [India’s] early growth [after liberalising the economy in 1991] came from a change in internal government policies – from anti-business to more market friendly policies,” he said.
“I feel some excess credit was given to external liberalisation rather than internal liberalisation for India’s economic growth.
He also gives his views on what will help India….
On whether India could make the leap from a predominantly farm economy to more industrial one even after missing a conventional industrial revolution, Professor Stiglitz said different countries could easily have different patterns of development.
A successful farming economy like Denmark, he said, had moved to low value added farm products to high value-added ones, and done very well.
Pointing out that jobless growth was a concern in all economies, Professor Stiglitz said India could very well prosper with a “mixed palette” of farm, service, manufacturing economies.
“I read today that India has only as many hotel rooms as New York. Now if India can promote tourism, some real high end tourism as opposed to backpacking which the country is famous for, then it can generate a large number of jobs,” he said.
On whether the form of Governments in India and China were a factor in the difference in development – he said:
“The difference [between the economies of India and China] has not so much do with democracy, but the failure [of India] to invest adequately in education and health”.
“The successful regions in India, for example, are growing as fast as China. The challenge is how do we get the backward areas to catch up.”
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