Nov 28, 2003
GoodNewsIndia names it, ‘the Surge’.
While listing the obvious causes for the Surge --quality consciousness, knowledge pool, domestic reforms, scaling up of operations etc-- India Today’s Shankar Iyer points to a tiny unobvious reason: “Itself the largest borrower, the government realised the price of costly money. Between 1997 and 2003 it ... forced prime lending rates down by over 500 basis points.” It then followed it up by massive investments in healthcare, railways and roads. As a result, even as other economies are spluttering, India is clocking 6% growth.
India’s legendary knowledge pool is brimming with an annual inflow of, “5.28 lakh engineers, 2.5 lakh doctors, 39 lakh humanities graduates, 17 lakh science graduates, 15 lakh commerce and management graduates, one lakh graduates in education and 2.5 lakh law graduates.” Results can’t be far behind. For example in the pharma industry Iyer says Indians “were known for their ability to deconstruct any patented drug within months...Today the very same skill sets are being used to derive new drugs, delivery systems and processes.”
There’s this delightful vignette in the article: it claims that France’s Michelin held back investing in China until the A V Birla group would commit itself to investing there too, to supply an essential input, carbon black.
That sort of earned reputation has resulted in the following: “there are 16 companies whose exports net over Rs.1,000 crore, 15 companies who export goods worth over Rs.500 crore and 150 companies who earn over Rs.100 crore in foreign exchange.” And finally the export number for Reliance alone: over Rs.10,000 crore or $2 billion!
A few more Reliances and the Surge will be a tidal wave.