India's Economy

Discussion in 'Economics' started by deepcsuf, Jan 12, 2006.

  1. dis

    dis

    Based on my experience dealing with engineers from India, and interviewing quite a few Indian engineers on the phone, I would say that India's economic potential is overhyped as was NASDAQ in Q1 of 2000.

    It is no accident that India is a third-world country, and will remain so in the foreseeable future.
     
    #21     Jan 30, 2006
  2. Has anybody come across any articles relating how successful outsourcing to India has been? I worked for a company that did it for their call centers and it was a complete disaster. They were not properly trained, didn't understand the cultural differences and didn't have the proper education to do the job. Similarly, I've known more than one person/company to hire programmers from there with massive problems. Also, some of the worst customer service experiences I've had (never rude, just clueless) have been from (I'm guessing here), India. Is India really a big story or is it all just hype about what "could be"?

    Thanks,

    - The New Guy
     
    #22     Jan 30, 2006
  3. toc

    toc

    "people are tiered of waiting for their turn to get some procedure done and they are turning to Indian doctors to get the medical procedures done at a much cheaper rate and much better qualified docs with American standard medical facilities at a cost which is 1/3 - 1/4"

    I know of a guy who got $10000 i.e. 10K worth of dental work done in India for mere $500. I asked him the standard of the clinics, he said doctors did not have the assistant in 2 of the 3 places but equiptment and procedure wise it was very good.
     
    #23     Jan 31, 2006
  4. toc

    toc

    The good part is India's growth is internally generated and unlike China it is not dependent on foreign manufacturers etc. to bring business. On the other hand items like population, environmental etc. India is a mess.
     
    #24     Jan 31, 2006
  5. vinrouge

    vinrouge

    i don't have any articles, but personal experience, hsbc, citibank, standard chartered bank etc outsourced their operations to India, there are still a long way to go in order to reach international standard.
     
    #25     Jan 31, 2006
  6. In India-China Race My Money Is on India: William Pesek Jr.

    Jan. 30 (Bloomberg) -- If you want to shock an audience of businesspeople, make this argument: Twenty years from now, India's rise will be more impressive than China's.

    Talk about making social blunder in a crowded room. The conventional wisdom is that efficient and rigidly controlled China will leave unsteady, plodding India in the dust. That certainly was the buzz at last week's World Economic Forum in Davos, Switzerland.

    Two decades from now, a very different outcome may befall Asia's two nascent superpowers -- one that investors should consider carefully.

    For an indication why, check out downtown Chennai. The southern city of 4.2 million is India's fourth largest and, like Mumbai and New Delhi, it's experiencing a retailing boom.

    Chennai's proliferating malls are abuzz with fashionably dressed 20-somethings showing off their growing affluence. They're sipping pricey espressos, buying Italian handbags and text-messaging each other on hyper-modern cellular phones. Upscale eateries are popping up everywhere, as are new apartment buildings.

    India or China?

    It's scenes like these that have economists such as Stephen Roach at Morgan Stanley saying, ``India is on the cusp of something big.'' As a share of gross domestic product, its burgeoning consumer sector is outpacing China, Europe and Japan. Economists are also noticing that India's economy is looking less like those in East Asia and more like those in the West.

    True, even the most superficial look at Asia's second- and fourth-biggest economies -- China and India, respectively -- argues in China's favor. Its world-class infrastructure, glistening skyscrapers, massive supply of cheap labor and ability to direct huge resources anywhere they're needed make it the world's version of a limber hare.

    India is Asia's tortoise, plodding along as China races off with a leading chunk of the world's direct foreign investment. Its infrastructure is an embarrassment, its bureaucracy a major economic headwind and its crushing poverty a reminder of challenges facing the world's second-most populous nation.

    Ground-Up India

    Here, the Aesop fable about the tortoise and the hare may offer some insight. In it, the hare, the clear favorite in the race, shoots ahead only to lose steam before the finish line. The less athletic, but steadily progressing tortoise wins in the end.

    For all its warts, India boasts a level of ground-up entrepreneurship China's top-down model can't match. It's created world-class, globally competitive companies and a real stock market, unlike the financial casinos that pass for equity bourses in China. India also has a liquid bond market and its banking system isn't bogged down by bad loans.

    Education policies, an ever-increasing pool of English speakers, demographic trends and political stability also are strengths. Democracy can be an inefficient, messy process and nowhere is that truer than in India. Yet it is civil society, a free press and accountable government that offer stability. China's transition from a command economy to capitalism poses many risks, including social instability.

    Top-Down China

    China's economy is an exciting one and the potential is huge. So seduced are investors and executives by what could go right in China, they often forget all that could go wrong, too.

    Also lost in the debate are the increasing ways in which Asia's two giants complement each other. As Microsoft Corp. Chairman Bill Gates said in India last month: ``People ask me, `What about India versus China?'; but I ask them `What about India plus China?''' It's being called ``Chindia.''

    Even so, here are three reasons to wonder if China has the stuff to remain ahead of India by the year 2026.

    The first is entrepreneurship. For all the stories about China churning out millions of engineers and scientists, innovation isn't at the heart of an economy that grew 9.9 percent last year. Foreign investment and massive government spending, not ideas or start-ups that create jobs, drive China's boom.

    Piracy's Costs

    India isn't exactly running on a single engine. Its economy is growing at an 8 percent rate with far less domestic and foreign investment than China. Simply put, it's done a more impressive job of creating a living, breathing economy. India already has fostered globally known and competitive companies like Infosys Technologies Ltd. and Dr. Reddy's Laboratories Ltd. China seems keener on buying brands than creating indigenous ones.

    The second big issue for China is piracy. While India has its challenges, it does a far better job of protecting intellectual property rights. Piracy is often viewed only as a problem for multinational companies. The phenomenon also holds China back.

    China must create technologies and products no one has thought of before. Its future as an innovative powerhouse -- and its ability to create millions of new jobs as a result -- depends on protecting the ownership of those advances. If Chinese innovators can't profit from their ideas because their fellow countrymen steal them, why should they bother?

    India's Challenge

    Third, China's rise itself. Nothing has provided a more abrupt wakeup call to India than China's emergence as a global economic power, supplanting the U.K. as the world's fourth- biggest economy. That may just be the catalyst needed to shake India out of its lethargy and kick the economy into higher gear.

    For India, there is no time for complacency. It must use the window of opportunity provided by today's growth. If it can, India may prove true something else that Aesop wrote long ago: ``Men often applaud an imitation and hiss the real thing.''

    To contact the writer of this column:
    William Pesek Jr. in Chennai, India or through the Tokyo newsroom at pesek@bloomberg.net

    Last Updated: January 29, 2006 14:03 EST
     
    #26     Jan 31, 2006
  7. Extract taken from rediff.com. This is an amazingly perceptive speech from a guy who's seen to be so stupid !


    QUOTE-
    India, China new competitors for US: Bush

    Aziz Haniffa in Washington DC | February 01, 2006 12:43 IST


    US President George W Bush, in his annual State of the Union speech in the well of the House chamber of the US Congress on Wednesday, acknowledged the growing economic power of India and China in the global marketplace and exhorted that it is imperative that America remains alert to stave off the competition its faces from these two rising economic giants.

    While stating that "the American economy is preeminent," Bush asserted, "we (the US) cannot afford to be complacent."

    "In a dynamic world economy, we are seeing new competitors, like China and India, and this creates uncertainty, which makes it easier to feed people's fears," he said.

    "So we're seeing some old temptations return. Protectionists want to escape competition, pretending that we can keep our high standard of living while walling off our economy. Others say that the government needs to take a larger role in directing the economy, centralising more power in Washington and increasing taxes," Bush said.

    The US President said that there were also the murmurs of xenophobia in that "we hear claims that immigrants are somehow bad for the economy, even though this economy could not function without them."

    "All these are forms of economic retreat, and they lead in the same direction -- toward a stagnant and second-rate economy," he warned.

    Bush argued that "to keep America competitive, one commitment is necessary above all: we must continue to lead the world in human talent and creativity."

    "Our greatest advantage in the world has always been our educated, hardworking, ambitious people and we're going to keep that edge," and then rattled off his "American Competitiveness Initiative," which he said would zero in on encouraging "innovation throughout our economy, and to give our nation's children a firm grounding in math and science."

    He said that it was a no-brainer that "we need to encourage children take more math and science, and to make sure those courses are rigorous enough to compete with other nations."

    As part of his initiative, Bush said: "Tonight I propose to train 70,000 high school teachers to lead advanced-placement courses in math and science, bring 30,000 math and science professionals to teach in classrooms, and give early help to students who struggle with math, so they have a better chance at good, high-wage jobs."

    "If we ensure that America's children succeed in life, they will ensure that America succeeds in the world," he predicted.

    Bush also made a strong pitch for his guest-worker programme which the White House believes is the panacea to resolving the illegal immigration problem, but which the President's own Republican Party -- particularly the right-wing conservatives -- have warned is dead on arrival, arguing that this is nothing more than an amnesty programme.

    "Keeping America competitive requires an immigration system that upholds our laws, reflects our values, and serves the interests of our economy," Bush said, but obviously in order to appease his conservative base, he conceded that "our nation needs orderly and secure borders."

    He said, "To meet this goal, we must have stronger immigration enforcement and border protection. And we must have a rational, humane guest worker programme that rejects amnesty, allows temporary jobs for people who seek them legally, and reduces smuggling and crime at the border."

    -UNQUOTE
     
    #27     Feb 1, 2006
  8. not before they do something about the infrastructure of the country.

    i have never been to india, but a very good friend of mine indian/american took an extensive trip out there and came back with two words "all hype".

    with zero bias, i can say that for now china is the way to go, and it will continue to be that way for years to come.
     
    #28     Feb 1, 2006
  9. This could be why:

    http://in.rediff.com/money/2005/nov/30bspec.htm

    - The New Guy
     
    #29     Feb 1, 2006
  10. DrChaos

    DrChaos

    A note about that.

    So Indian IT grads are not sufficiently trained on hands-on practical skills.

    That isn't surprising, the same is true from graduates in any other university, as university is about life-long cognitive discipline and ideas, not business-specific practical skills.
     
    #30     Feb 2, 2006