Where were you a year ago? I was sitting on the couch, watching footage of once-overpaid, overworked 20- and 30-somethings running from the wreckage of Lehman Brothers, carrying boxes full of - what was it? contraband? office supplies? - as the dreams of a generation looked about to crumble.
According to today's HT, "India has every reason to cheer." The author compares the recent financial crisis to the Great Depression of the 1930s, but I'd go the opposite route and say that the recent financial crisis has shown how much the world has changed since railway speculation plunged the United States into one of its darkest-ever national hours.
As an econ student, I remember reading once that the linkages between global financial markets would make another major recession impossible. At first glance it seems we've discovered the opposite - one of the big sources of the Indian stock market crash was the rapid departure of scared Western investors - but on a global level, it seems that interaction between international institutions has strengthened the world's economy.
Now that India and China are recovering (in fact, many sectors of the Indian economy suffered very little), foreign investors are once again eager to invest in a growing Indian stock market. Companies want to cash in on growing Asian demand. These are good things, and the relative openness of world financial institutions will make this possible. In fact, interaction with Asia will certainly speed the rate of recovery in the United States and Europe.
despite all the gloom surrounding 'recession' Indian economy grew by 6.7% in 2008-09. If at the turn of century anybody would have talked of 6.7% growth rate, one would have jumped out of joy! But the fact is that in the previous 3 years we had GDP growing in excess of 9% and hence the displeasure or panic over 6.7% growth. I tell you what this panic over recession ('economic tsunami') was simply because the developed countries, most notably the USA felt the pinch. Nobody has bothered to take note of the fact that the economy of Cote de Ivoire (previously Ivory Coast) actually shrunk by more than 2% every year during the 1990s. The financial crisis was the USA's contribution to the world economy. But don't judge the state of economy by stock exchange... & multilateral financial institutions do require serious reforms... Let's not bother about growth rates of USA and Europe too. Globalisation has been used by these developed countries to serve their own purpose only.. Let's not give too much importance to foreign investors- they are fair weather friends only.. If India has grown in recent decades it is because of our human capital and new liberalised policies which have provided appropriate incentives.
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