The action
Last week marked exactly 10 years since the term BRIC was coined. The catchy acronym for Brazil, Russia, India and China used to describe the new powerhouse emerging markets. But the man who invented the moniker now says one of the four has been a great disappointment. No, not Russia, with all its recent troubles; not Brazil, whose economy contracted in the last quarter; and certainly not China, which continues to power on.
Goldman Sachs' Jim O'Neill says that the country that has been the biggest letdown has been India. He pointed out last week that India's inability to attract foreign investment could actually lead to a balance of payments crisis. From BRIC to basket case, "What in the World?" is going on?
Well, some numbers tell a troubling story. Growth has dipped below 7% for the first time in two years. The Indian rupee is Asia's worst performing currency this year, falling to a historic low against the dollar.
India's deficits are soaring and funding is drying up. India received less than $20 billion in foreign direct investment in the first six months of 2011. China got three times that amount. Even Russia, with the smaller GDP, took in more.
Why is India struggling? Sadly, the real problem isn't economics. India has a very dynamic private sector - probably the most dynamic in the emerging markets. But it has a government that simply doesn't work.
The reaction
People are saying:
1) Fareed, you blow it. How dare you degrade India like this! You are committing the cardinal sin of reporting on India.
India is the world's greatest democracy and its greatest super power. We may have had one quarter of bad luck, but that does not take away our super power status and to be commented on by you minor little islanders.
As the world's greatest democracy, Incredible India will automatically resume hyper growth the next month.
With Russia melting, China imploding, and Brazil running into the ground, India is the undisputed leader of the BRIC countries. Here in Mumbai, there in Delhi, and there again in Pune, India shines while the world declines!
And what are the rest of you in PIIGS, Bordello, Chinks, and Yankees? A crisis of course. All, come to sugar daddy, India; we are willing to rush to your help! We got all the jobs in the world, and our dalits are certainly willing to spare their jobs for you. Our prime minister has already pledged $300Billion US dollars of aid, virtually every single drop of dollars in our coffers.
Because we can afford it! India's Tata has been lording over the world industries by purchasing such Western properties as LRJ and Corus, and making these former money pits a big success. Our Mittal has been overwhelming the world's steel makers by swallowing up Arcelor. Our mobile phones have been out-talking all other countries by growing 100 million users every quarter. Our architects had designed and finished the world's largest airport in Delhi in Terminal 2. Our engineers have built the world's greatest hydro dam. Our road builders had just completed the world's longest bridge in Mumbai. Our prime minister has been presiding over these big international meetings by sounding our voices over all these heads of all your minor states. Our super aircraft carriers have been patrolling the world's oceans and scaring all the Ethiopia and Somalian pirates off their pants.
For all these a million reasons, submit to your fate under our Hindu colossus, beg our 5-rupee meal middle classes, bow to our super powers.
Pray for India, we will have pity on you. Jai Hind!
2) Folks, Experimental democracy is DOA (Dead On Arrival) in India. It is has never worked in large populated countries. Particularly those with mostly illiterate populace such as India. Too big to manage, minorities such as muslims, sikhs, christians get disenfranchised etc. India will need to go back to its socialist/communist roots. Maybe splitting it up into smaller pieces (circa USSR) is an alternate scenario. CIA is probably running some models to deal with the potential implosion.
3) Not withstanding the gloom – Farid has hit the nail on the head.
India has a first world private sector and a dead-third world govermnment.
All in all – the biggest cuplrit in India's sagging fortunes is the state of West Bengal!! its decades old affair with communism and now an inward looking socialism under Mamata Banjerjee is unfortunately now hijacking national politics!!
West Bengal communists- who supported the UPA government during its first 5 years – prevented any reforms.
Now TMC under Mamata Banerjee- after the Communists were routed – is now holding up reforms.
If India needs to grow – the backwards and regressive West Bengali politics should be suppressed. Their archaic and economically destructive mindset has already damaged the counrty for 10 years. Its about time the regional politics was killed in the interestes of saving the country!!
4) India's government is an ailing leviathan, as it has failed to have the whole country under control. Decentralisation and federalism are democratic virtues. Yet due to the cultural, ethnic and cultural diversities, moreover the inability of the government to act appropriately, disparities come as no surprise. The central government in Delhi has to reform the judiciary. In many parts of the country justice and equality still leave much to be desired.
5) Sadly, diversity has nothing to do with it. Its corruption all the way. Weasel politicians just use diversity as a card to cling on to power. Any endeavor undertaken by the present govt has been marred with mega corruptions (2g, common-wealth, etc) and thus, even the public has lost faith in them. The next two years for the govt is just going to be a fight to stay in power and not get caught for all they have done.
We just are a pseudo democracy.
6) Zakaria, if you want to smudge the image of the BRICs (the last survivors of this crisis), you should talk about the vacant cities and ghost shopping malls in CHINA.
But I know that the Chinese government is the main sponsor of CNN, that´s why you never talk bad things about them.
7) Unity is not the choice for most indian states where some citizens dream of having their own countries like what happened with erstwhile USSR. If it is by some modest force, so be it. But every citizen indeed has a chance in India, not unlike China or Russia where scores of people just go missing, never to be seen again. India's share with such stories is not zero but it is much smaller as compared to most of other countries. Talks of dividing India as a nation has to be very strictly dealt with and opposed very very vehemently.
Yes, India's democracy is a problem but is also its strength. We have to look at our weaknesses, do a SWOT analysis, and then move ahead with a single point agenda of making all indians well fed for a start. And yes, to hell with most of the politicians. Maybe Anna Hazare movement would bring some sanity to them. So may god help.
Jai Hind.
Last week marked exactly 10 years since the term BRIC was coined. The catchy acronym for Brazil, Russia, India and China used to describe the new powerhouse emerging markets. But the man who invented the moniker now says one of the four has been a great disappointment. No, not Russia, with all its recent troubles; not Brazil, whose economy contracted in the last quarter; and certainly not China, which continues to power on.
Goldman Sachs' Jim O'Neill says that the country that has been the biggest letdown has been India. He pointed out last week that India's inability to attract foreign investment could actually lead to a balance of payments crisis. From BRIC to basket case, "What in the World?" is going on?
Well, some numbers tell a troubling story. Growth has dipped below 7% for the first time in two years. The Indian rupee is Asia's worst performing currency this year, falling to a historic low against the dollar.
India's deficits are soaring and funding is drying up. India received less than $20 billion in foreign direct investment in the first six months of 2011. China got three times that amount. Even Russia, with the smaller GDP, took in more.
Why is India struggling? Sadly, the real problem isn't economics. India has a very dynamic private sector - probably the most dynamic in the emerging markets. But it has a government that simply doesn't work.
The reaction
People are saying:
1) Fareed, you blow it. How dare you degrade India like this! You are committing the cardinal sin of reporting on India.
India is the world's greatest democracy and its greatest super power. We may have had one quarter of bad luck, but that does not take away our super power status and to be commented on by you minor little islanders.
As the world's greatest democracy, Incredible India will automatically resume hyper growth the next month.
With Russia melting, China imploding, and Brazil running into the ground, India is the undisputed leader of the BRIC countries. Here in Mumbai, there in Delhi, and there again in Pune, India shines while the world declines!
And what are the rest of you in PIIGS, Bordello, Chinks, and Yankees? A crisis of course. All, come to sugar daddy, India; we are willing to rush to your help! We got all the jobs in the world, and our dalits are certainly willing to spare their jobs for you. Our prime minister has already pledged $300Billion US dollars of aid, virtually every single drop of dollars in our coffers.
Because we can afford it! India's Tata has been lording over the world industries by purchasing such Western properties as LRJ and Corus, and making these former money pits a big success. Our Mittal has been overwhelming the world's steel makers by swallowing up Arcelor. Our mobile phones have been out-talking all other countries by growing 100 million users every quarter. Our architects had designed and finished the world's largest airport in Delhi in Terminal 2. Our engineers have built the world's greatest hydro dam. Our road builders had just completed the world's longest bridge in Mumbai. Our prime minister has been presiding over these big international meetings by sounding our voices over all these heads of all your minor states. Our super aircraft carriers have been patrolling the world's oceans and scaring all the Ethiopia and Somalian pirates off their pants.
For all these a million reasons, submit to your fate under our Hindu colossus, beg our 5-rupee meal middle classes, bow to our super powers.
Pray for India, we will have pity on you. Jai Hind!
2) Folks, Experimental democracy is DOA (Dead On Arrival) in India. It is has never worked in large populated countries. Particularly those with mostly illiterate populace such as India. Too big to manage, minorities such as muslims, sikhs, christians get disenfranchised etc. India will need to go back to its socialist/communist roots. Maybe splitting it up into smaller pieces (circa USSR) is an alternate scenario. CIA is probably running some models to deal with the potential implosion.
3) Not withstanding the gloom – Farid has hit the nail on the head.
India has a first world private sector and a dead-third world govermnment.
All in all – the biggest cuplrit in India's sagging fortunes is the state of West Bengal!! its decades old affair with communism and now an inward looking socialism under Mamata Banjerjee is unfortunately now hijacking national politics!!
West Bengal communists- who supported the UPA government during its first 5 years – prevented any reforms.
Now TMC under Mamata Banerjee- after the Communists were routed – is now holding up reforms.
If India needs to grow – the backwards and regressive West Bengali politics should be suppressed. Their archaic and economically destructive mindset has already damaged the counrty for 10 years. Its about time the regional politics was killed in the interestes of saving the country!!
4) India's government is an ailing leviathan, as it has failed to have the whole country under control. Decentralisation and federalism are democratic virtues. Yet due to the cultural, ethnic and cultural diversities, moreover the inability of the government to act appropriately, disparities come as no surprise. The central government in Delhi has to reform the judiciary. In many parts of the country justice and equality still leave much to be desired.
5) Sadly, diversity has nothing to do with it. Its corruption all the way. Weasel politicians just use diversity as a card to cling on to power. Any endeavor undertaken by the present govt has been marred with mega corruptions (2g, common-wealth, etc) and thus, even the public has lost faith in them. The next two years for the govt is just going to be a fight to stay in power and not get caught for all they have done.
We just are a pseudo democracy.
6) Zakaria, if you want to smudge the image of the BRICs (the last survivors of this crisis), you should talk about the vacant cities and ghost shopping malls in CHINA.
But I know that the Chinese government is the main sponsor of CNN, that´s why you never talk bad things about them.
7) Unity is not the choice for most indian states where some citizens dream of having their own countries like what happened with erstwhile USSR. If it is by some modest force, so be it. But every citizen indeed has a chance in India, not unlike China or Russia where scores of people just go missing, never to be seen again. India's share with such stories is not zero but it is much smaller as compared to most of other countries. Talks of dividing India as a nation has to be very strictly dealt with and opposed very very vehemently.
Yes, India's democracy is a problem but is also its strength. We have to look at our weaknesses, do a SWOT analysis, and then move ahead with a single point agenda of making all indians well fed for a start. And yes, to hell with most of the politicians. Maybe Anna Hazare movement would bring some sanity to them. So may god help.
Jai Hind.
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