Can India Return to its 'Miracle Growth' Phase of the Early 2000s?
Free Public Lecture
Australia India Institute, the University of Melbourne
149 Barry Street
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In the first decade of the 2000s, India’s economic growth was among the fastest in the world, and close to the miracle growth rates East Asian countries experienced during their rapid growth phase. Since 2010, however, India’s economic growth has slowed considerably.
While much of the recent commentary has focused on infrastructural constraints, difficulty in doing business and the negative economic impact of demonetisation has severely constrained India’s economic growth.
This talk will argue that the rapid phase of growth in the 2000s was unsustainable and built on a political equilibrium that involved high rates of rent-sharing between political and economic elites. While there has been a change in political regime, the underlying equilibrium remains the same, and has led to a secular stagnation in the corporate investment rate, a major driver of India's economic growth in the past.
Kunal Sen is Professor of Development Economics in the Global Development Institute, University of Manchester, UK.