‘Domestic consumption, rising service sector key growth drivers’

Mrinal
Sapre

New Delhi: The demographic situations in India,
high domestic consumption, diminishing public sector monopolies and widespread
knowledge of English are among the key drivers of
India’s economic growth, said Rajeev
Dalmia, chief financial officer (CFO) of Dish TV.

Speaking on ‘Indian Economy-Challenges
Ahead’ at a brainstorming session, “Discover”, at Dish TV’s Noida campus, Dalmia
said service oriented GDP growth, gradual reduction in tax rates, openness to
trade and investment are also playing a pivotal role in India’s economic
expansion.  

“India
is a mixed economy of China
and the
US.
Our mindset is that of the US,
but roots are similar to
China,”
Dalmia said.

He added that Indian economy resembles the
US model as 100 companies have monthly cap of USD 1 billion and 125 for and 125
fortune 500 companies have Research and development base in India.

Highlighting the overall scenario of the
world economy, he said GDP of the world stands at USD 52 trillion dollars and
that of
India
is USD 1.3 trillion. China
has become second largest economy with GDP of USD 3.9 trillion and
India is at 13th in the world.

In terms of per capita income, India is one of the lowest in the world where as

China
per capita income is USD 3,500.

Dalmia said due to the recent credit
crisis, European economy was exposed to its inherent weakness and was facing
tremendous challenges in terms of growth and even default in sovereign debts,
going forward.
Japan continues to be in stagflation and suffers due to ageing population and
stagnant growth over last three decades.

According to him, Fiscal deficit and rising
unemployment are the rising challenges all across the world.

“These have serious social and economic
consequences. Rising inflation is also cause of worry for the whole of the
Asia. Rupee continues to be under pressure due to
negative balance of payments, rising oil prices and fluctuation in foreign
inflows. Food shortage is another challenge which needs to be dealt with as the
prosperity at the bottom level going up over last 14-15 years, due to rising
GDP,” the CFO added.  

 “We
have moved from Hindu rate of growth i.e. 3-3.5% of GDP , to one of the highest
growth in GDP averaging around 8%+ in last decade, but it will be difficult to
continue this growth unless we invest on infrastructure , disinvestment and
bold reforms relating to agriculture and social sector,” he further said.