Hardselling India at Davos
TOPIC: General Studies 2
- Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
- Important International institutions
In news: India saw its PM attending the WEF first time in last 20 years. Today, Davos has emerged as an important platform for gathering of leaders- political and business. Political considerations feed into economic roles. Thus, this will help India get more direction and contribution to Make In India is welcomed.
What is world business community expecting from India?
India’s rise on world stage has been remarkable. It was PM’s opportunity to showcase India’s reform process and rapid growth due to its attractive business climate. Some of the crucial actions taken are-
- Liberalizing FDI
- Steps to resolve the stressed assets issue
- Launched the most difficult reform- GST
- Digitization of economy
This is where a country’s economic agenda and political approach can be seen. At present, India is looking forward to its revival of the economy. Since India is a large market with its large domestic market, it is not difficult to do business in India. With India going up by 30 points in ease of doing business, it is a good sign for Indian business environment. Recently, India has signed the Australian wassenar agreement and the missile technology control regime. Thus, it seems India is going in the right direction and since the global economy is now reviving, the rest of world is looking at India as a market where lot of business can be done.
Today, the global economy is scaling towards fourth industrial revolution and navigating in the multipolar world. There are eight things which Davos has asked to think about-
- Effects of the class privilege
- Mental health
- Social stigma attached to disability
- Social stigma attached to LGBTQ
Davos studies the economic and geopolitical areas. The other key issues are
- Crypto currency
- Investment opportunities in blockchain technologies
- Why are oil prices growing up
- Growing gap between rich and poor needs attention. Recently a report said that in India, top 1% has gained 73% of the total wealth. It is better than world numbers where globally 1% rich have 80% of total wealth.
India, the focus
Davos is the prestigious gathering of the business leaders of the world and where major political leaders come. This is the session where business leaders look at big and long term issues. India is going to be one of the three largest economy of the world in this century.
In terms of potential demand and potential business, India is little ahead of china as India is underdeveloped. So for business leaders, India is very important.
India no longer wants to be only a spectator but also wants to be a stakeholder. This is an opportunity for India at the highest level to make the point that India is rapidly reforming, responding to challenge, responsive to suggestions made by international community and India can do things which can impact positively on world economy.
What has changed in recent time that India has emerged as a global player.
India has been growing rapidly for last several years so there is a cumulative impact of growth that has propelled India into being the fifth largest economy in the world. Thus what India says or does in the sphere of economic policy or geopolitics is important.
Challenges for India
- The outcome of the economic activities is more important than the fiscal deficit.
- The cost of logistics are as high as 14% of the sale value whereas globally it is 6%. The government is doing a lot for roads, waterways and ports. But right now these are bottlenecks in the sense that it takes away the competitiveness of country.
- Trade deficit of 2017 had reached to 14 billion rupees. It means that the imports that took place other than oil and electronics, the imports were actually replacing domestic supplies. Thus, the domestic supplies need to be encouraged.
- Job creation is very low. Though the EPO accounts are created, it is because lot of informal sector working people are now being formalized thereby increase in EPO accounts.
The theme is ‘creating a shared future in fractured world’ as many countries are now looking forward to managing their domestic economy first. Countries are always competing for economic resources. There is healthy environment for it.
India is now itself to the global economy, linking to world and optimizing its capacity to contribute.
The message from India to the world is India is open for doing business more than it ever was. The manner in which polices have been liberalized, changed and tweaked shows India’s improvement in ease of doing business. The fine print would be to what extent the ecosystem of the county is correspondingly developed in the areas of infrastructure, red tape and bureaucracy, The social infrastructure-education, health, water development is critical as they complement the ecosystem created to invite the investors and foreign investments. Moreover, women have a large role to play in world affairs.
The bigger economies are moving towards bilateralism from multilateralism. This has to be reversed and India has a huge role to play. As a responsible large player, India offers the most exciting business offers in the coming decades. Each of the weaknesses are the business opportunities. Thus, India has to convey a degree of commitment to overcoming the challenges and being a credible place to do business and a largest market in coming decades.
World Economic Forum-
- Established in 1971 at Geneva
- It is an International Organization for Public-Private Cooperation.
- The Forum engages the foremost political, business and other leaders of society to shape global, regional and industry agendas.
Connecting the dots:
- India is selling itself to the world in terms of opportunities for increased business through its wide market. However, before the invitation, the ground work for its success has to be set. Examine the opportunities present in the challenges for India.
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