India set to grow faster than China in 2010: World Bank

[Rage]

India set to grow faster than China in 2010: World Bank

First Published: 00:46 IST(23/6/2009)
Last Updated: 02:08 IST(23/6/2009)

Hopes of an economic rebound became stronger on Monday with the World Bank predicting that India’s gross domestic product (GDP) would grow by 8 per cent in 2010.

If achieved, it would make India the hottest growth economy in the world, better even than China that was forecast to grow at 7.7 per cent next year. The world economy was projected to grow at 2 per cent in 2010.

The data, which came in a report Global Development Finance 2009: Charting a Global Recovery, could fuel interest in India among foreign investors.

“Foreign direct investment inflows to India doubled, reflecting economic reforms in recent years and progress in opening up additional sectors for foreign investment,” the report said.

Latest domestic macroeconomic data has shown strong signs of a rebound. India’s industrial output showed 1.4 per cent growth in April, up from a 0.75 per cent contraction a month earlier.

“We may see more green shoots of recovery as fiscal and monetary stimulus have an impact,” said Manoj Vohra, Director, Research at Economist Intelligence Unit (EIU).



http://www.hindustantimes.com/Story...set+to+grow+faster+than+China+in+2010:+Report
http://trendsniff.com/2009/06/22/india-projected-to-grow-faster-than-china-in-2010-world-bank/
http://www.newscred.com/article/sho...an-china-in-2010-report-4a3fe3438a287/1681898
http://content.usatoday.com/topics/...Alliances,+Cartels/World+Bank/0gLV0Im7q43Rb/1

 

[Rage]

At 8%, India to grow fastest in ’10: World Bank

23 Jun 2009, 0139 hrs IST, ET Bureau

NEW DELHI: The World Bank has projected an 8% growth for India in 2010, which will make it the fastest-growing economy for the first time, overtaking China’s expected 7.7% growth.

The multilateral lender has revised upwards the growth rate for the Indian economy this year to 5.1% from an earlier projection of 4%, according to its Global Development Finance Report released on Monday. India has consistently outperformed growth forecasts by the World Bank in the past.

The prospects for the global economy remain ‘unusually uncertain’ despite recent signs of improvement in some parts of the world, the report points out. Barring a few countries, including India and China, the bank has cut 2009 growth projections for all other economies and expects the world economy to contract by 2.9% this year.

"Developing countries are expected to grow by only 1.2% this year, after 8.1% growth in 2007 and 5.9% growth in 2008.

"When China and India are excluded, GDP in the remaining developing countries is projected to fall by 1.6%, causing continued job losses and throwing more people into poverty," the report said.

The report calls on governments around the world to be vigilant when drawing up strategies to reverse the recent expansionary monetary and fiscal policies once the world economy takes off.

The bank has urged rich countries to boost the flow of credit to developing nations to help speed up economic recovery. “Developing countries can become a key driving force in the recovery, assuming their domestic investments rebound with international support, including a resumption in the flow of international credit,” said Justin Lin, chief economist at World Bank.

Despite the gloomy picture for this year, the bank says growth in developing countries, led by India and China, could reach 4.4% in 2010 and 5.7% by 2011.

Since global growth will only return to its full potential by 2011, the gap between actual and potential output, unemployment and disinflationary pressures continue to build, the report adds.

This World Bank report compares with a more upbeat assessment by the International Monetary Fund, which said last week the decline in global output has moderated and it may raise its 2010 growth forecast for the world economy.


At 8%, India to grow fastest in '10: World Bank- Indicators-Economy-News-The Economic Times
http://in.buzz.yahoo.com/article/1:the_economic_606:3a69b2ccf515bb1a09e280ae87b1bd2f/At-8-India-to-grow-fastest-in-10-WB

 

[Rage]

Take me to the magic of the moment
On a glory night
Where the children of tomorrow share their dreams
With you and me
Take me to the magic of the moment
On a glory night

The winds of change
Blows straight into the face of time
Like a stormwind that will ring the freedom bell
For peace of mind
Let your balalaika sing
What my guitar wants to say

The world is closing in
Did you ever think
That we could be so close, like brothers
The future's in the air
I can feel it everywhere
Blowing with the winds of change

 

[p2prada]

^^ Not if a drought hits the monsoon season. There are already fears of El-Nino in the Pacific.

 

[hit&run]

Take me to the magic of the moment
On a glory night
Where the children of tomorrow share their dreams
With you and me
Take me to the magic of the moment
On a glory night

The winds of change
Blows straight into the face of time
Like a stormwind that will ring the freedom bell
For peace of mind
Let your balalaika sing
What my guitar wants to say

The world is closing in
Did you ever think
That we could be so close, like brothers
The future's in the air
I can feel it everywhere
Blowing with the winds of change

Whose woods these are I think I know.
His house is in the village, though;
He will not see me stopping here
To watch his woods fill up with snow.
My little horse must think it queer
To stop without a farmhouse near
Between the woods and frozen lake
The darkest evening of the year.

He gives his harness bells a shake
To ask if there's some mistake.
The only other sound's the sweep
Of easy wind and downy flake.

The woods are lovely, dark and deep,
But I have promises to keep,
And miles to go before I sleep,
And miles to go before I sleep.
we have to go miles 'brother' without sleep

 

[p2prada]

Take me to the magic of the moment
On a glory night
Where the children of tomorrow share their dreams
With you and me
Take me to the magic of the moment
On a glory night

The winds of change
Blows straight into the face of time
Like a stormwind that will ring the freedom bell
For peace of mind
Let your balalaika sing
What my guitar wants to say

The world is closing in
Did you ever think
That we could be so close, like brothers
The future's in the air
I can feel it everywhere
Blowing with the winds of change

Guess its Scorpions- Wind of Change.

 

[hbogyt]

Good luck!
But it ain't over!

 

[Daredevil]

Good luck!
But it ain't over!

What ain't over??. Growth story of India??

 

[p2prada]

Good luck!
But it ain't over!

It's not a competition on who will finish first. India catching up or surpassing China is a matter of pride for us as catching up or surpassing Japan is a matter of pride for you.

Regards.

 

[Singh]

More bullish on India than on China: Stephen Roach​

Morgan Stanley's Asia Chairman Stephen Roach commenting on issues such as economic trends, Asian markets, and the Indian economy, said he saw a cap on economic revival and added that the US consumer demand was still declining. He asserted that India and China were unlikely to fill the void created by the global slowdown.

Roach further said that he was more bullish on India than China for the first time. He added that the election outcome changed the prospects for reforms going forward. However, Roach cautioned that India’s Budget deficit was a worrying factor and that the country's dependence on external capital inflows was a weakness too.

Morgan Stanley's Asia Chairman Stephen Roach commenting on issues such as economic trends, Asian markets, and the Indian economy, said he saw a cap on economic revival and added that the US consumer demand was still declining. He asserted that India and China were unlikely to fill the void created by the global slowdown.

Roach further said that he was more bullish on India than China for the first time. He added that the election outcome changed the prospects for reforms going forward. However, Roach cautioned that India’s Budget deficit was a worrying factor and that the country's dependence on external capital inflows was a weakness too.

On India

For the first time in a dozen years we are actually now more optimistic on prospects for India than I am for China and the reason is that India has made good improvements in recent years from the standpoint of macro developments especially higher savings, increased foreign direct investments and a modest improvement in the infrastructure share of India in GDP.

These improvements reinforce the long standing accomplishments of India on the micro front – large collection of world class competitive companies, well educated IT competent workforce, extraordinary entrepreneurs and innovators, well developed capital market solid financial institutions, rule of law and democracy – what's been missing in this interplay between the micro and now the improved macro has been the political impetus to reforms, something it is hobbled your government in the last five years.

The recent election changes the prospects for reforms going forward and it is my hope that the new Congress led government will be much more effective in pushing ahead reforms on a number of fronts and will be much less hobbled by the politics of coalition management.

So I am pretty optimistic on India and at the same time China faces major strategic challenges for the first time in 30 years. It has pushed its export led model too far leaving it too dependent on the external climate that will be severely affected by the multiyear pullback of the US consumer that I just alluded to.

So China faces a challenge at a time when the India story has come together very nicely and wouldn’t it be ironic when the world is completely embraced the Chinese miracle for the real surprise in Asia has turned out to be India.

More bullish on India than on China: Stephen Roach

 

[Rage]

There you have it, the BBC now beginning to report the possible overtaking of Chinese growth:


Can India's economy overtake China?

Last updated at 23:24 GMT, Saturday, 3 October 2009

Can the lumbering elephant overtake the hyperactive dragon? What appeared unthinkable for decades, if not for more than half a century, may actually happen soon, perhaps as early as next year.

In 2010, the Indian economy may grow faster than that of China. What is more, experts contend that South Asia could expand at a more rapid pace than East Asia.

While there is no dearth of sceptics who believe that China will continue to grow faster than any other major economy on the globe in the foreseeable future, there are others who contend that the trend growth rates of the two most populous nations could change and that India could march ahead of the Chinese economy just a little faster than many predict.

" The economy of India started accelerating from the early 1990s onwards as Delhi loosened bureaucratic controls over industry, trade and services "​

China and India, accounting for roughly 40% of the 6.5bn plus people on Planet Earth, are not merely the two fastest growing major economies in the world at present, but are among the few countries that have continued to expand at a time when the economies of most countries have contracted.

In the early 1950s, in terms of per capita income and levels of economic development, there was little to distinguish between China and India. Half the populations of both countries were mired in abject poverty - in India's case after centuries of colonial rule.

From the 1970s, the Chinese economy started growing at a fast rate while India's economy grew sluggishly at an average rate of growth of 3.5% - sarcastically described by the late economics professor Raj Krishna as the "Hindu rate of growth".

As China grew by double-digits decade after decade for nearly 40 years, economists kept claiming the bubble would burst, that data was doctored by smart statisticians in Beijing - but the metaphorical dragon continued to grow bigger and bigger defying all expectations.

The economy of India, on the other hand, started accelerating from the early 1990s onwards as Delhi loosened bureaucratic controls over industry, trade and services.

In the middle of the 1990s, for the first time since India became independent in August 1947, the country's economy expanded by an annual average of more than 9% four years in succession, that is until the impact of the ongoing international recession saw the Indian economy decelerate.

The World Bank predicts India will
grow by 8% in 2010​

Economists argue that one reason why India's economy can grow faster than that of China in the near future is simply on account of what statisticians describe as a "base effect".

Following this argument, India's growth rate is higher because the base on which the rate is calculated is narrower.

China's economy is roughly three and a half times bigger than that of India - Gross Domestic Product (GDP) measured in US dollars in 2008 for the two countries stood at $4.2 trillion and $1.2 trillion respectively.

But there is an important reason why India's economy has been hurt relatively less by the ongoing international economic recession in comparison to China, whose growth has been largely export-driven in recent decades.

Exports and imports put together (including "invisible" earnings from tourists, workers' remittances and exports of services) account for approximately half of India's GDP whereas the comparable proportion for China is over 80%.


Forecasts revised

Two years ago, China overtook the US as India's largest trading partner.

In late June, the World Bank in its Global Development Finance 2009 report projected that in 2010, the rate of growth of India's economy at 8% would be faster than that of China, expected to be 7.7%.

The bank's forecast for the current year was revised upwards for both China (from 6.5% to 7.2%) and India (from 4% to 5.1%) but these prognostications are lower than those made by the governments of the respective countries.

The Chinese government claims a rate of growth close to 8% for 2009, while various agencies of the Indian government would place the comparable figure at somewhere between 6.5% and 7%.

East Asia is predicted to grow
at a slower rate than South Asia​

The bank report pointed out that the growth rate of all developing countries taken together had come down from 8.1% in 2007 to 5.9% in 2008 and is expected to be only 1.2% this calendar year.

"When China and India are excluded, GDP (gross domestic product) in the remaining developing countries is expected to fall by 1.6%, causing continued job losses and throwing more people into poverty," the World Bank report stated.

Justin Lin, the bank's chief economist, was quoted as saying that developing countries could "become a key driving force" in reviving the world's economy, "assuming their domestic investments rebound with international support, including a resumption in the flow of international credit".

Mr Lin is not alone. Speaking at a recent seminar in Delhi, Ajay Chibber, Assistant Secretary General of the UN's Development Programme, said it would have unthinkable until recently that India could grow faster than China.

"I never thought I would see it during my lifetime but South Asia could grow faster than East Asia," he remarked.

Kalpana Kochhar, deputy director of the Asia Pacific department of the International Monetary Fund, told me that it was no longer improbable that India could grow faster than China or that South Asia would expand at a faster pace than East and South-East Asia.

"I see these as distinct possibilities," she said.


BBC NEWS | South Asia | Can India's economy overtake China?

 

[Flint]

Nice, but predictions are after all just predictions. A lot can go wrong in the next 12 months. Besides, some forecasts are predicting lower growth as well.

 

[Rage]

Absoloutely, which is why we have to ensure we're careful and don't slip up. The truant monsoons will also take their toll on potential economic growth. Cloud seeding is something I believe we should seriously look into to mitigate the paucity of rains in the North.

 

[corpus]

india s GDP is still highly agro dependant. how can india grow at such a high per centage in a drought hit year....?

 

[tarunraju]

india s GDP is still highly agro dependant. how can india grow at such a high per centage in a drought hit year....?

That is true, though the report was prepared back in June, when there was no drought in sight.

 

[LETHALFORCE]

will there be a drought in 2010??

 

[corpus]

That is true, though the report was prepared back in June, when there was no drought in sight.

That's why predictions will always be predictions......



[mod] please avoid using SMS type language in your posts[/mod]

 

[prahladh]

These reports may not become true but will help our new FDI initiative Govt is taking up.

 

[tarunraju]

will there be a drought in 2010??

Yes, there will be a drought in 2010. No, there won't be a drought in 2010. All at the flip of a coin.

 

[Martian]

I wish India the best of luck next year on its 2010 economic growth in its attempt to overtake China. As I have said, the world keeps on changing.