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  1. Nobel laureate Paul Krugman says India grew 5 times faster than Britain; but these key concerns remain

Nobel laureate Paul Krugman says India grew 5 times faster than Britain; but these key concerns remain

Nobel Laureate Paul Krugman lauded India’s growth story saying that India has grown at a rapid pace achieving in just 30 years, the economic progress made by Great Britain in 150 years. However, he pointed out key concerns including poverty and unemployment.

By: | Updated: March 18, 2018 9:19 AM
Paul Krugman says India made economic progress equivalent to Britain's 150 years in just 30 years. Paul Krugman says that rest of world is not paying as much attention to India as it should. (Image: Reuters)

Nobel Laureate Paul Krugman lauded India’s growth story and observed that the country has grown at a rapid pace achieving in just 30 years, the economic progress made by Great Britain in 150 years. While this may be intriguing, the top economist pointed out that despite the economic progress, there is high poverty, and the wealth hasn’t been equally distributed. “There are issues of corruption. You cannot become Denmark with Chinese levels of corruption,” Krugman said speaking at the News18 Rising India Summit on Saturday.

In his address, Paul Krugman also said that rest of world is not paying as much attention to India as it should. “If China wasn’t around, we would have said what an incredible story India is,” Krugman noted adding that the country has achieved extraordinary progress as reflected in  quadrupling of GDP per capita in a very short time, and becoming a better place to do business.

Krugman said that India must up the ante on its manufacturing sector and not just focus on services. Comparing India with Japan and China, Krugman noted that Japan is no longer a superpower because its working-age population declined, and China is looking the same. “In Asia, India could take the lead but only if it also develops its manufacturing sector, not only the services one,” he said at the event.

One of the major reasons for the country to develop its manufacturing sector is to solve the unemployment issue, he said. “India’s lack in the manufacturing sector could work against it, as it doesn’t have the jobs essential to sustain the projected growth in demography,” the ace economist observed.  

Krugman credited India’s services sector saying that  services is propelling growth to an extent that hasn’t been seen anywhere else in the world. He sees enormous potential due to globalisation of services. “Globalisation of service trade has a huge potential. That’s one reason to be especially hopeful of India’s progress. It has the first-mover’s advantage here,” Krugman noted. Apart from the phenomenal growth in the services sector, Krugman says that India will also benefit a lot from its demographic dividend.

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  1. Karpakarajan V Chettiar
    Mar 19, 2018 at 9:41 am
    what is his scale of measurement!
    Reply
    1. Praveen Kumar
      Mar 18, 2018 at 12:32 pm
      Krugman also forget to mention about corrupt politicians as one more cause of slow growth.
      Reply
      1. Jimmy Lobo
        Mar 18, 2018 at 11:05 am
        As Krugman said,India is lacking in manufacturing sector, providing s . and too much of inequality.He has failed to mention the plight of agriculturists.
        Reply
        1. chandra sekaran
          Mar 19, 2018 at 10:15 am
          Well he mentioned about moving large number of people from the rural areas means agriculture. But, his skepticism about the dominance of services sector and for the manufacturing to provide more s is little misplaced. India is a huge country in terms of people and so greater scope for services to provide for more s, when particularly the manufacturing is constrained by lack of infrastructure - power, roads, etc. may be like in China, greater focus and investment on these activities will create more s in the next few years and in the course of time supporting manufacturing.
          Reply

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