jump to navigation

India: corruption affecting investment and economic growth December 13, 2012

Posted by southasiamasala in : Future Directions International, Guest authors, India , comments closed

Gustavo Mendiolaza

Transparency International released the results of its annual Corruption Perceptions Index on 5 December 2012. India was ranked 94 out of 174 countries in corruption, a claim highlighted by the scandals that have hit the Indian National Congress-led government this year.

Background

India, and the Congress-led United Progressive Alliance government in particular, have felt increasing pressure over the levels of corruption. This year’s Corruption Perceptions Index (CPI) illustrates that although the situation has improved since last year, an underlying culture of corruption still exists in India. Such endemic corruption may cause a decline in India’s attractiveness for foreign direct investment (FDI).

(more…)

CHOGM: our complex relationship with India November 1, 2011

Posted by southasiamasala in : Guest authors, India , comments closed

Gail Pearson

First published in The Conversation on 26 October 2011

India is one of Australia’s largest trading partners – and yet, our relationship at times appears hopelessly fraught. This week, Prime Minister Julia Gillard ruled out changing the government’s stance on uranium exports to India. This has been an increasingly contentious issue between the two countries as India seeks to further expand its nuclear-powered electricity to meet its growing energy needs. With the announcement that India will significantly ramp up its manufacturing sector to create 100 million jobs over 10 years, this pressure will only increase.

In August, India’s Prime Minister Manmohan Singh unexpectedly withdrew from CHOGM, opting instead to send vice president Hamid Ansari. Media reporting of concerns of racism towards Indian students has also done little to perpetuate positive views from both countries.

Emerging economic power

There is a perception that the Australian government has been unable to establish an optimal relationship with India – as a diplomatic cable leaked to whistleblower website Wikileaks revealed in March. Yet, why this is the case isn’t exactly clear. Like Australia, India was relatively unscathed by the global financial crisis. It is the fourth-largest economy in the world by purchasing power parity and the 11th by GDP. While its rate of growth has recently slowed to 7.7% against a target of 9%, India’s Reserve Bank has raised rates yet again in a bid to combat inflation.

There are 55 Indians with assets over $1 billion on the Forbes Rich List – seven are in the top 100, two are in the top 10. By the end of last year, India was our seventh largest two-way trading partner (up from 10th in 2008) and our third largest export market. By contrast, the United Kingdom is our fifth largest trading partner. In return, Australia is India’s sixth largest trading partner.

At a diplomatic level, India continues lobby for a permanent seat on the United Nations Security Council, while we are lobbying for one of the rotating seats. There is a Strategic Partnership between Australia and India and a Bilateral Investment Promotion Treaty between the two countries. We are negotiating a Free Trade Agreement. So there is potentially much in common. (more…)