A Crash course on India - What The Hell is Happening?
Vas Adusumilli
Issue date: 5/27/04 Section: Perspectives
The first gulf war in 1991 took a toll on India. Steep oil prices and the socialist agenda of the government depleted the foreign reserves to less than one billion dollars. This brought an interesting change in politicians. Faced with great chaos, politicians started to welcome academicians and experts to solve country's problem. One such example is Mr. ManMohan Singh (current Prime Minister), an economist and professor from the Delhi School of Economics, as the foreign minister in 1991. Slowly the country started to deviate from socialist and protectionism attitude and opened its doors to foreign investment and competition. This helped the country improve, while developing many industries in the country. While everyone acknowledges the recent growth in the Indian IT sector, the country is also making strides in BioTech, Manufacturing and Pharmaceutical industries among others. This is all happening because the country is being able to use its most important natural resource; a well educated middle class community. As an example, when a fresh undergraduate engineer (in 1991) had a problem in finding a job that pays him $70/month, today that same undergraduate engineer fresh out of college is commending salaries of $300/month.
Reform leaders like Mr. Chandra Babu Naidu pushed for aggressive changes and this helped to bring companies like Microsoft, Oracle, Baan and GE to start their research and development centers in India. Cities like Bangalore and Hyderabad (also called Cyderabad) started to emerge on the world map. While this change was good, it took a toll on some communities, predominantly the farmers. As an example, while the government in Andhra Pradesh is using its limited resources to initiate new industries, limited help from the government and drought during the past 3 years crushed the farming community in this state. Not to forget, that 80% of the people in this state are involved with agriculture. This time people in this state used their votes to throw away the reformist government and to obtain freebies like free electricity from the new government (new government wrote-off $352 million of debt to farmers).
Reform leaders like Mr. Chandra Babu Naidu pushed for aggressive changes and this helped to bring companies like Microsoft, Oracle, Baan and GE to start their research and development centers in India. Cities like Bangalore and Hyderabad (also called Cyderabad) started to emerge on the world map. While this change was good, it took a toll on some communities, predominantly the farmers. As an example, while the government in Andhra Pradesh is using its limited resources to initiate new industries, limited help from the government and drought during the past 3 years crushed the farming community in this state. Not to forget, that 80% of the people in this state are involved with agriculture. This time people in this state used their votes to throw away the reformist government and to obtain freebies like free electricity from the new government (new government wrote-off $352 million of debt to farmers).