Google+ Consumer Psyche: Elephant becomes a tiger

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Thursday, October 2, 2008

Elephant becomes a tiger

For a change, its good news. The Indian economy is making waves. It seems to be growing fast and that too consistently for several years in a row. What the economists call, "a sustained high growth path". The latest official data says overall economic growth touched 9.4 per cent in 2006-7, giving the UPA government a nine per cent average during its three year tenure. There is, however, a dark lining to the silver cloud. Agriculture is lagging behind the rest of the country with a low 2.7 per cent growth rate, showing that the aim of inclusive growth has yet to be achieved.

Firstly, it shows that sustained high growth is possible for this country like the tiger economies or China. India no longer has to continue being compared to an elephant lumbering along slowly. Even if the high growth is uneven for the time being, this defect can surely be made up if concerted efforts are made by policy makers. Secondly, consistent high growth does have some amount of trickle down effect even though this may be a slow process. Which does not mean we have to wait for affluence to trickle down to the poorest of the poor. Anti-poverty programmes have an important role in this country. But it does mean that high growth will have a positive impact on large sections of the populace even in rural areas.

For instance, despite all the hoopla over the negative effects of large retailers on small traders in the country, they seem to be helping farmers in some regions.. Reports have come in about Jharkhand farmers finally getting a good price for their produce as large retailers are buying directly from them and bypassing the middlemen. Till recently, middlemen would buy at low rates from the farmers and sell at exorbitant prices in the retail markets. Farmers never got the benefit even when vegetable prices were ruling high. Now that cultivators are finally getting their due, politicians are taking up cudgels for the middlemen.

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