India stumbles forward
04 September 2012
India's economy grew by 5.5% in the quarter ending June. This is a little better than the prevous quarter, and much stronger than any Western economy. But to create enough jobs for its youth, to seriously tackle poverty, and to make good progress in catching up its East Asian neighbors, it needs growth of 10% or more.
Until recently, India had been growing strongly, but private investment has now fallen out of bed, and the fear is that private consumption will start to weaken too. India has many deep problems --
entrenched corruption, a labyrinth of bureaucracy, political paralysis, weak education levels, and a ballooning budget deficit.
And unless the government starts to tackle these, India's prospects will remain weak.