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India Political and Economic Outlook 2010-2014

Updated on October 22, 2010

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India's General Outlook for 2011-2014

This hub takes a brief look at the political and economic outlook of India for 2011 to 2014. The main sources of this outlook are the Economist Intelligence Unit (EIU) and Country Watch. The following is a general summary of EIU's forecasted outlook for India through 2014

  • Despite its lack of a reliable parliamentary majority, the Indian National Congress-led United Progressive Alliance (UPA) coalition government is expected to serve a full second term that will run until 2014.
  • Although the government survived a parliamentary no-confidence vote in April 2010, a nationwide strike in July against high food and petrol prices showed that the opposition will continue to make life difficult for the UPA.
  • The Economist Intelligence Unit expects the government to meet its budget deficit target of 5.5% of GDP for fiscal year 2010/11 (April-March). Public expenditure will continue to rise rapidly in 2010-14.
  • The Reserve Bank of India (RBI, the central bank) will continue to tighten monetary policy during the remainder of 2010 and in 2011. Monetary policy will return to a more neutral stance in 2012-14.
  • Real GDP on an expenditure basis is forecast to expand by 8.4% in 2010/11 and 8.6% in 2011/12, compared with 7.7% in 2009/10. Growth will average 8.7% a year in 2012/13-2014/15.
  • Consumer price inflation is forecast to slow from 11.7% in 2010 to 6.4% in 2011, owing to the high base in 2010. It will average 5.3% a year in 2012-14.


India Fun Facts and Vital Statistics

CultureGrams reports the following fund facts and other vital signs about the country of India -

India Fun Facts

Covering 1,269,338 square miles (3,287,590 square kilometers), India is roughly one-third the size of the United States. India has the second largest population in the world and is one of the world's most ethnically diverse countries. The nation is home to several hundred languages, of which 33 have 100,000 or more speakers. India is the birthplace of Buddhism, Hinduism, Jainism, and Sikhism.

India Vital Statistics

Capital: New Delhi
Current Time: 12:38 AM
Latitude: 28.36
Longitude: 77.12
Population: 1,173,108,018 (rank=2)
Area, sq. mi.: 1,269,219 (rank=7)
Area, sq. km.: 3,287,263
Human Dev. Index rank: 134 of 182 countries
Adjusted for women: 114 of 155 countries
Real GDP per capita: $2,753
Adult literacy rate: 77% (male); 55% (female)
Infant mortality rate: 30 per 1,000 births
Life expectancy: 62 (male); 65 (female)
Currency: Indian rupee

India's History - A Brief Look

In brief sketch about the history and background of India, Country Watch analysts reported the following:

India is the largest democracy and second most populous country in the world.

Its history dates back to 2500 B.C.E., when the inhabitants of the Indus River valley developed an urban culture based on commerce and sustained by agricultural trade.

Aryan tribes from the northwest infiltrated onto the Indian subcontinent about 1500 B.C.E., bringing the indigenous beliefs that evolved into Hinduism, and various empires followed.

Arab incursions starting in the 8th century and Turkic in the 12th were followed by those of European traders beginning in the late 15th century. By the 19th century, Britain had assumed political control of virtually all Indian lands. Nonviolent resistance to British colonialism led by Mohandas Gandhi brought independence in 1947, and Pakistan was established as a separate Muslim state because of Muslim-Hindu hostilities.

There have been three wars between India and Pakistan since 1947, two of them over the disputed territory of Kashmir. A third war between the two countries in 1971 resulted in East Pakistan becoming the separate nation of Bangladesh.

India is now one of the fastest growing economies in the world with a large skilled workforce.

The country has a burgeoning urban middle class and has made great strides in fields such as information technology. However, India's economic growth remains constrained by inadequate infrastructure, bureaucracy, labor market rigidities, and regulatory and foreign investment controls.

About 60 percent of the population is still living close to, or below, the poverty line.

India Political Outlook for 2010-2014

As reported in the October 2010 Economist Intelligence Unit update, the Indian National Congress led by the United Progressive Alliance (UPA) coalition did well to lead a strong economic recovery after the global recession in 2008-2009. However, they were less than impressive in the political sphere and because of that fact India's political outlook for 2010-2014 may be rocky.

While many hoped that the government led by prime minister Manmohan Singh and UPA coalition would be more effective in the second term (2009-2014) than in its first (2004-2009), difficulty passing important legislation demonstrates that the political situation is less than rosy.

Moreover, EIU analysts observed that the rocky political outlook is probably exacerbated by the fact that the UPA coalition lacks a firm majority in the lower house of parliament and is in the minority in the upper house.

In April 2010 Singh and his group survived a no confidence vote; however, a nationwide strike in July 2010 against high food and gas prices demonstrates that those in power will continue to be challenged by the opposition parties.

According to EIU, in the early part of the forecast period the UPA-led government will face several substantial and formidable challenges including

  • Slowing the rate of inflation;
  • Delivering on its promise of inclusive growth;
  • Dealing with an escalating Maoist insurgency in eastern and central India;
  • Making more progress on fighting corruption;
  • Keeping control over the uprising in Kashmir.

Even though the general public gives credit to Singh and his coalition for the economic recovery, other fears impacting India's political outlook for 2010-2014 include the concern that instability will mount if the rate of inflation cannot be brought under control.This was made glaringly clear by the success of the opposition parties to shut down the country with strikes in July 2010.

During the forecast period, India's political outlook for 2010-2014 will also be heavily impacted by the burgeoning Maoist movement and continuing problems with neighboring Pakistan. Subsequently, India faces both domestic and foreign terrorist threats. However, the EIU analysts commented that India's democracy seems entrenched and resilient, thus the possibility of political collapse is lower than in most other Asian countries.

India Economic Outlook for 2010-2014

In light of the fact that prime minister Singh and the UPA coalition survived the no confidence vote, India's economic outlook for 2010-2014 should remain generally positive. This means the economic policies for the forecast period will be consistent with the direction that was pursued in the first five years of Singh's coalition government which led to steady growth and expansion.

Since the beginning of 2010, the Indian economy surged in activity and that surge is expected to continue through the forecast period. Accordingly, EIU analysts forecast that India's real GDP will grow 8.4% in 2010/2011, 8.6% in 2011/2012, and 8.7% per year in 2012/2013 to 2014/2015. So, India's economic outlook for 2010-2014 seems to be favorable.


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    • ecoggins profile image

      ecoggins 6 years ago from Corona, California

      H P Roychoudhury, Thank you for adding clarity to the rise of India's economic rise. I appreciate your contribution very much.

    • H P Roychoudhury profile image

      H P Roychoudhury 6 years ago from Guwahati, India

      Yes, the article has rightly pointed out lots of information although all are not correct in totality. But nothing is mentioned about reasons of economic lift except expert IT professionals. It is the people of Secular India who devoted their full energy in building Industry in all sectors instead of political chaos of Hindu-Muslim and other local issues. A country of diverse language and religion working for Indian Union because of a Secular nation under democratic set up believing a citizen of one Nation against the creation of neighboring religious states and religious instigation at the birth of the Nations.

    • profile image

      peace_lover 6 years ago

      Hi Ecoggins!!

      U r doing really good job as i also read ur stuff on indonesia..very informative!! However, in this article talking about map is bit controversial as there are also territories in indian north west claimed by China or Pakistan specially disputed Kashmir. So be un bias either show those also different color from rest of map or vice versa...

    • profile image

      RajulalHareendran 6 years ago

      Is the INDIAN Map correct...? Think again

    • profile image

      Gokhale Pramod 6 years ago

      Agree or disagree India has come on global stage and going to act as a responsible guardian without hurting anybody's national interests and culture.India is known as a largest outsourcing hub.

    • ecoggins profile image

      ecoggins 6 years ago from Corona, California

      bab, I don't think you found the right Indian restaurant. I recently had a dish of beef masala and it was scrumptuous.

    • profile image

      bab 6 years ago

      I like india but indian food are really awful .but indian fruits are so tasty ,

    • worldframe profile image

      worldframe 7 years ago

      Good information


    • profile image

      Pranjna 7 years ago

      we are reader wanna reality from

    • safiq ali patel profile image

      safiq ali patel 7 years ago from United States Of America

      Some interesting facts and figures about india's economy in this hub. I did no know that inflation is running at 11% in india. I also read the hub about India's top 100 brands and this too is an interesting read.

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      jani435 7 years ago

      You are right East Pakistan became Bangladesh after Indo-Pak war in 1971 and there were no such alliance of Bangladeshi freedom fighters and Indian forces, Indian army defeated both East & West Pakistan alone and Bangladesh is byproduct of that war.

    • ecoggins profile image

      ecoggins 7 years ago from Corona, California

      jungson_thapa, you are very much correct. I knew that and should have done a better job editing the copy. Thank you for pointing out my error.

    • jungson_thapa profile image

      Umesh Jung Thapa 7 years ago from Kathmandu, nepal

      Wrong information about Buddha. India is not the birthplace of Buddhism. Nepal is the bithplace of Buddha.

    • ecoggins profile image

      ecoggins 7 years ago from Corona, California

      Mr. Naim Hasan, thank you for the clarification. I appreciate your comments and welcome your input.

    • Naim Hasan profile image

      Naim H 7 years ago from Dhaka

      i have objection on some parts of your hub.Bangladesh-Pakistan war started 26th march, 1971 before india-pak 3rd war started in November,1971 and Indian army made an alliance with the freedom fighters of Bangladesh and the latter was a byproduct of the previous. and Bangladesh was not born out of india-pak war, nor India alone defeated Pakistan,pakistan surrendered to the the joint alliance force of Bangladesh-India. Thank you

    • ecoggins profile image

      ecoggins 7 years ago from Corona, California

      Jeff - thank you for encouraging comment. The idea of relocating to India is an interesting one. I lived in Cambodia for six years and I know that those who choose to live and work abroad need great patience as they navigate the unfamiliar waters of a new culture and the episodes of culture shock that accompany it.

    • Jeff Cavallaro profile image

      Jeff Cavallaro 7 years ago from Outside the Box

      Certainly a lot of good information. Those seeking employment and able to travel or relocate may possibly benefit by considering a company located in India.