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CNBC-TV18 India talks to Kaushik Basu on Growth

LTD Editors's picture

Following is the trancscript of Kaushik Basu's interview with CNBC-TV18, India, which first appeared on www.moneycontrol.com.

In an interview to CNBC-TV18, Kaushik Basu, chief economist, World Bank said the growth situation has to be taken seriously. "I do believe that, for India, there has to be all focus on growth."

Despite the fact that compared to the rest of the world, India is doing well, he said, it has the potential to get right back to 8.5 percent growth. "We have to put all hands on growth and try to get it back again up as quickly as possible," he added.

Q: You have been appointed as World Bank’s chief economist. So, the view from the inside has now changed to the view from the outside, has not it?

A: A little bit. Three months ago, I moved from the heart of Indian policymaking to seeing it from outside.

For Jobs and Growth, a Focus on Competitiveness

How can we spur competitive industries? Tune in Saturday, October 13 at 10:30 JST to hear from Ngozi Okonjo-Iweala , Minister of Finance, Nigeria; Hideto Nakahara, Senior Executive Vice President, Mitsubishi Corp.; Byron Auguste, Social Sector Practice Global Leader, McKinsey & Co. and others.

With the global economy struggling to rebound from the prolonged financial crisis, the world’s policymakers are now assembling in Tokyo for crucial policy discussions at the annual meetings of the World Bank and the International Monetary Fund. Yet the chronic crisis may lead to new opportunities, if it provokes policymakers to re-think and recalibrate how they approach the challenge of competitiveness, growth and job creation.

Where is India's economy heading?

Ulrich Bartsch's picture

The India Economic Update 2012 will be discussed online.Ulrich Bartsch, the World Bank's outgoing senior country economist for India, will lead a 24-hour live chat on the World Bank India Facebook page. He and other experts will be discussing the Bank's latest India Economic Update. The chat will begin Wednesday, Oct. 10, at 4:30 p.m. India Standard Time (7 a.m. Eastern Daylight Time in the United States). Here, he provides a sneak preview.

India’s economic growth has slowed to a pace not seen since the beginning of the 2000s. At the same time, the current account deficit has reached a record high. We project growth in the current fiscal year to reach around 6%, a slowdown from the already low 6.5% growth in the previous year. This growth projection is predicated on an improving domestic and external environment, but the risks for a worse outcome are high.

Longreads: Geography of Poverty, Reporting Poverty, Chinese City Limiting Cars, a FarmVille for Africa

Donna Barne's picture

Find a good longread on development? Tweet it to @worldbank with the hashtag #longreads.
 

LongreadsThe Economist’s much tweeted-about "Geography of Poverty" highlights a "poverty paradox" – that more of the world’s extremely poor people now live in middle-income countries rather than in the poorest ones. The finding comes from a new paper by Andy Sumner of the Institute of Development Studies. But the situation could change by 2025 if the number of poor people grows in fragile states, say Homi Kharas of the Brookings Institution and Andrew Rogerson of the Overseas Development Institute in the Economist. Veteran journalist Katherine Boo, author of a new book on life in a Mumbai slum, discusses the challenge of portraying poor people as individuals in the media, in an interview with Guernica in "Reporting Poverty." Big Chinese cities are starting to adopt measures with the potential to ease pollution and "improve the long-term quality of Chinese growth," according to a story in the New York Times. "A Chinese City Moves to Limit New Cars" describes, among other things, restrictions in Guangzhou expected to cut the number of cars on city streets in half. And finally, imagine vicariously smashing mosquitoes, riding a motorbike through the streets of Lagos, or remembering life in a rural village. The BBC writes about a Nigerian video game-maker who believes Africans and non-Africans alike may want to tap into the African experience through games.

Keeping India’s Promise Alive

Kalpana Kochhar's picture

India has been a beacon to the world on how a thriving and vibrant democracy can transform itself into an economic powerhouse. The metamorphosis that took place in the Indian economy after the reforms of the early 1990s is nothing short of spectacular. The Indian economy was transformed into a dynamo of innovation and diversification. This fundamental transformation unlocked two decades of explosive growth in which poverty rates fell by nearly 20 percent, exports as a share of GDP increased nearly five-fold, and standards of living increased by a factor of almost four. This trajectory received but a glancing blow from the 2008 global financial crisis—this resilience was a testimonial to the benefits of the economic reforms of the previous 15 years.

Challenges to India’s Growth

But now, India’s economy once again faces formidable challenges and the fear is that it is considerably less well placed to deal with these challenges than at any time over the past two decades. The global economy is facing a new phase of the crisis characterized by an extreme bout of uncertainty, risk aversion and volatility, this time originating in the Euro Area. Some skeptics have recently questioned: Will India weather this storm as well as it did in 2008-09 and will the story of “Incredible India” remain credible?

Inequality of What?

Francisco Ferreira's picture

More than ten years ago Ronald Inglehart, of the University of Michigan, and his team at the World Values Survey asked thousands of respondents around the world to rate their views, on a scale of 1 to 10, on whether they felt inequality in their countries should go up or down.  The way they phrased the question was that 1 corresponded to full agreement with the statement that “incomes should be made more equal”, whereas 10 stood for “we need larger income differences as incentives for individual effort”.

G20 Needs to Focus More on Growth

Zia Qureshi's picture

This is the central message of a report World Bank staff prepared as an input to the G20 Los Cabos summit held from June 18-19. The summit comes at a precarious time for the world economy. The Euro Area is facing a relapse into recession, with potentially large losses of output with global repercussions if current risks to stability and growth are not addressed forcefully. Recovery in other advanced economies is weak and faltering. Growth is also slowing in emerging economies that have been the drivers of global growth in recent years. Against this background, the Bank report, entitled Restoring and Sustaining Growth, conveys the following main messages:

To measure poverty over time, we need to do more!

Luc Christiaensen's picture

The latest World Bank estimates suggest that the percentage of the developing world’s population living below $1.25 a day declined from 52% in 1981 to 22% in 2008. While this indicates that there is still a long way to go in poverty reduction, the progress is encouraging. Moreover, we now also appear to be in a much better position to make such statements. The numbers above, by my colleagues at the Department Research Group, are based on over 850 household surveys for nearly 130 developing countries, representing 90% of the population of the developing world. By contrast, they used only 22 surveys for 22 countries when the first such estimates were reported in the 1990 World Development Report.

What Can South Asia Do to Make the Big Leap?

Ejaz Ghani's picture

Last week, I discussed the optimistic and pessimistic views of South Asia's development potential. As I highlighted in my book, Reshaping Tomorrow, South Asia is among the fastest growing regions in the world, but it is also home to the largest concentration of people living in conditions of debilitating poverty, human misery, gender disparities, and conflict.

I also ask if South Asia is Ready for the Big Leap. The optimistic view is that India will achieve double-digit growth rates benefiting the rest of South Asia. The pessimistic view is that growth will be derailed by structural and transformational challenges. In this entry, I will make some suggestions on how South Asia could realize the optimistic view.

What can be done?


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