India: Asia's Next Economic Dynamo? - Forbes http://www.forbes.com/sites/edfuller/2015/09/10/india-asias-next-eco...
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Ed Fuller Contributor
I write about global tourism, hospitality and business.
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FORBES ASIA 9/10/2015 @ 4:05PM 11.877 views
Indian Prime Minister Narendra Modi gestures as he speaks during a
national convention on space technology in New Delhi on Sept. 7. (PRAKASH SINGH/AFP/Getty Images)
Make no mistake about it: India is on the move.
After his landslide election victory in May 2014, Prime Minister Narenda Modi told his nation that he needed just 10 years to modernize the country and promised that by 2022, Indias 75th anniversary of independence, the world would recognize that the 21st century is Indias.
Over the 15 months since taking office, Modi has
become a rock star for Indias enormous cohort of optimistic millennials and business community as well as for the Indian diaspora. His appearance at Madison Square Garden in New York last September drew a record crowd of more than 18,500. Since taking office, hes made 26 international trips, mostly to countries in Asia, but also to North and South America, Europe and Australiaselling potential investors on doing business in India. At home, hes been streamlining the Indian bureaucracy, easing anti-business regulations and selling his constituents on his vision for India.
When Modi took office, Indian inflation was
running at 9% and economic growth was 5%. Today, inflation is down to 5% and the International Monetary Fund estimates the Indian economy will grow 7.5% in 2015, outpacing Chinas growth for the first time since 1999. And the countrys future prospects look promising. The World Bank predicts India has the potential to be the worlds 3rd largest
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India: Asia's Next Economic Dynamo? - Forbes http://www.forbes.com/sites/edfuller/2015/09/10/india-asias-next-eco...
economy within the next 10 years and to be one
of the worlds largest by mid-century. GDP is expected to grow between 7.5% and 8.3% in the coming year.
Perhaps Indias $2 trillion economy will remain
much smaller than Chinas $10 trillion behemoth for years to come. But with todays low oil prices, the worlds largest democracy and its huge, skilled population have lots of room to grow.
Even now, India is the worlds 4th largest IT
start-up hub with more than 3,100 tech startups in the past year alone. It ranks second in worldwide food production. Its auto industry churns outs 22 million cars a year, making it one of the worlds largest auto manufacturers. It boasts a $600 billion retail market and is one of the worlds fastest growing e-commerce markets. And earlier this year, under his Make in India policy, Modi helped persuade Koreas giant Samsung and Europes Airbus to open new factories in his country.
According to Ernst & Young, Indias middle class,
about 50 million strong, or 5% of the population, will reach 200 million five years from now. They predict that Indias middle class growth will accelerate quickly, reaching 475 million by 2030 and will be adding more people than China to the global middle class just 12 years from now.
As its middle class expands, Indias outbound
tourism market is also growing. By 2020, it is expected to exceed $40 billion. Favored destinations for Indian travelers today are Singapore and Thailand, followed closely by the U.S. and China in third and fourth place, respectively. According to Renub Researchs Report, Indian Outbound Tourism Market/Spending Analysis, in terms of spending by Indian tourists, the U.S. ranked first in 2014. In fact, Indian travelers spent more on their trip to the U.S. than on the combined total spent on the top nine tourism destinations.
So, its not surprising that the worlds travel
market is carefully noting the trends, including Ireland, Spain, South Korea, Indonesia, Macau (China) and Polandall of which recently opened tourist offices in India.
A decade from now, India will clearly be a vastly
different country than it is today and may very well be Asias newest shining economic star. With roots in its rich and diverse past (dating back more than 250,000 years), its religious and philosophical traditions (8 major religions or philosophies of life are actively practiced in the country), its young peoples optimism (more than half of the population is under 25 years of age) and, of course, its growing middle class, India is
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India: Asia's Next Economic Dynamo? - Forbes http://www.forbes.com/sites/edfuller/2015/09/10/india-asias-next-eco...
well on its way to becoming a significant global
player in this century. It will be great to watch, and perhaps participate in, its emergence on the worlds stage.
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