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Saturday, May 05, 2012

"Never Mind Europe, Worry About India"

Tyler Cowen:

Never Mind Europe. Worry About India., by Tyler Cowen, Commentary, NY Times: The economic slowdown in India is one of the world’s biggest economic stories, but it is commanding only a modicum of attention in the United States.
It may not even look like a slowdown because by developed standards, India’s growth — estimated by the International Monetary Fund at 6.9 percent for 2012 — is still strong. But a slowdown it is: the economy has decelerated from projected rates of more than 8 percent, and negative momentum may bring a further decline. ...
What is disturbing is that much of the decline in the growth rate is distributed unevenly, with the greatest burden falling on the poor. If the slower rate continues or worsens, many millions of Indians, for another generation, will fail to rise above extreme penury and want. The problems of the euro zone are a pittance by comparison. ...
India also is a potential force for energizing the economies of Bangladesh, Nepal and, perhaps someday, Pakistan and Myanmar. The losses from a poorer India go far beyond the country’s borders; furthermore, the wealthier India becomes, the stronger the allure of democracy in the region. ...
India may not be alone in this slowdown. There is a more general worry that the grouping of disparate giants known as the BRIC nations — Brazil, Russia, India and China — has, for some reason, lost much of its previous momentum. ... Chinese and Russian G.D.P. growth are slowing too, to an unknown extent and duration....
We ignore India’s troubling trends at our peril.

    Posted by on Saturday, May 5, 2012 at 01:51 PM in Economics | Permalink  Comments (38)

          


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