INDIA 2020 : VISION FOR THE FINANCIAL SECTOR
There is no ambiguity the world over about India's immense economic potential and its growing clout in global economics and finance. In 2012, India's GDP stood at $ 1.82 trillion (World Bank) and at $ 1.78 trillion in 2012-13 making it the second largest economy in Asia and tenth largest in the world. With its huge domestic consumption, availability of
skilled manpower, natural resources and talented policy makers, by 2020, India is expected to overtake BRIC Countries like Brazil and Russia; and also countries like Spain and Canada in global GDP rankings. The last decade has been a mixed bag for the Indian economy and businesses. After the high of 2010 (11%), the GDP growth slowed down to 6% (World Bank) and to a decade low of 5% in 2012-13 (CSO) (World Bank estimate is 5.7%). The current-account gap widened to 4.8 percent of gross domestic product in the 12 months ended March, much higher than 2.5%, which the Reserve Bank of India deems a sustainable level. Inflation remains stubbornly high at around 10%, presenting the unenviable specter of low growth and high inflation. Increasing foreign capital outflows and weak currency are not helping either. Quantitative Easing by the US Federal Reserve has prompted investors to pull out from the emerging markets. Foreign investors sold a net $3 billion of Indian stocks and bonds in July 2013 alone. Rupee has lost more than 28% against the US Dollar in the last two years and is heading towards 70 Rupees mark, pulling down the business confidence. The response of Reserve Bank of India has also come under criticism for its handling of the Rupee slide, renewing the debate on the Central Bank's autonomy. Clearly, the India growth story has taken a hit and a lot would need to be done structurally and on the policy and political fronts to repair the damage and get back on the growth track. "India 2020: Vision for the Financial Sector" purports to visit the overriding concerns that India will need to contend with during the next seven years or so to come true to its global expectations. It will endeavor to bring together economists, financial experts and business leaders to deliberation various issues that beset Indian economy and businesses and suggest novel solutions.
