Explain the recent growth in India
India is an economy, which has developed rapidly recently and experienced high rates of growth. This is shown by the growth rate of 7% since 1997. India growth has been focused by domestic growth. They want people in India to buy the goods meaning that their growth is dependent on their economy. This means they don’t rely on exports to other countries and their economy being dependent on economies they trade too. The growth was started in the 1990’s when India started to reform this meant that they barriers were reduced. This helped to encourage foreign direct investment; this was different from the other newly industrialised countries. There was large growth in the service sector in India.
India managed to go from agriculture and skip out the industrialisation and go straight to the service sector. This happened because India has a good education system, which means there labour is well educated. When Indians go to university they study in English. This means they can have call centres for the English there, as the labour cost is cheaper than the UK. As around 3 million people graduate from India University every year, of that 500,000 of them are engineering graduates. This helped to set up sections specialised in technology in Bangalore. The low labour cost makes it perfect as they have well educated good English workers who can run a call centres. India is also perfect for this as they have a good infrastructure, they have the rail network left by the British as well as reliable telephones and internet.
The service industries developed as young Indian professionals went to UK or US to work for western companies. When they did they learnt how IT works in those countries. This helped them to start to set up their own businesses in India to help supply these needs. They have cheap labour, which meant they were able to undercut the prices of developed countries competition. The western countries started to outsource...
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