globalization and present scenario of India

1. Making India A Global Hub
Presented by-
Ashish
Naman
Praveen
Rajkaran
Rounak
Shreel

2. Walk through the history
 India opened up the economy in the early nineties
following a major crisis that led by a foreign exchange
crunch that dragged the economy close to defaulting on
loans.
 The response was a number of Domestic and external
sector policy measures partly prompted by the immediate
needs and partly by the demand of the multilateral
organizations.
 The new policy regime radically pushed forward in favor
of a more open and market oriented economy.

3. Introduction
 Open Mind Set
o Intolerance for laziness
o Shoddy Products
o Open Corruption
o Use of cheapest resources available
o Hire the best people
o Face Competition
 Multi Cultural
 Multi Ethnic Society
 Free press that readily exposes the shortcomings

4. Why is India as a country closed?
 Poor colonial experience.
 Politicians.
 Lack of confidence in Indian entrepreneurs.
 ‘Cant compete’ attitude.

5. According to Raghuram Rajan, India could move
faster towards being a global hub if it considers the
following key factors:
 first, expanding access to, and improving the quality
of, education.
 second, improving access to finance.
 third, creating more ownership and infrastructure in
rural areas
Key steps towards making India a global hub

6. Polarity
 The wealth of high net worth individuals (HNIs) in India, is set
to grow by a compounded annual growth rate (CAGR) of 23 per
cent over the next four years and will touch a staggering Rs 249
trillion (US$ 4.69 trillion)
 350 million people below poverty line
 Cut-off for poverty line
• 29 rupees, or 55 cents, a day in urban areas
• 22 rupees or about 40 cents a day in rural areas
 Electricity sector in India had an installed capacity of 202.98 GW
as of May 2012, the world's fifth largest

8. Education
 1.4 million schools with over 227 million students
enrolled and more than 36,000 higher education
institutes
 25% of its population is still illiterate; only 15% of
Indian students reach high school, and just 7%, of the
15% who make it to high school, goes for graduation.
 India produced 11% of graduates in 2010, expected
produce 12% of the share of graduates by 2020 around
the world.
 Education in India is provided by the public sector as
well as the private sector, with control and funding
coming from three levels: central, state, and local.
 In 2005 India (2nd largest education system after China)
was having 2.5 million graduates CAGR of 34% at
present.

9.  Till education market is expected of having mammoth
size of US$ 40 billion by 2020. higher education
contributes 59.7 per cent of the market size, school
education 38.1 per cent, pre-school segment 1.6 per
cent, and technology and multi-media the remaining 0.6
per cent.
 India’s higher education system largest in the world
enrolling over 70 million students.
 Higher education sector 46,200 crore.
 Schools have grown at a CAGR of 2.5% from 1.2
million in 2005 to 1.4 million in 2011 and enrolment
has grown at a CAGR of 2.2% to reach 284 million
students in 2015.

10.  The 2011 survey holds the National Literacy Rate to
be around 74.07%.
 The youth literacy rate, measured within the age
group of 15 to 24, is 81.1% (84.4% among males and
74.4% among females), while 86% of boys and 72%
of girls are literate in the 10-19 age group.
 India holds an important place in the global
education industry.
 The country has more than 1.4 million schools with
over 227 million students enrolled and more than
36,000 higher education institutes.

11. Investment
 The total amount of foreign direct investments (FDI)
inflow into the education sector in India stood at US$
1,171.10 million from April 2000 to June 2015.
 According to data released by Department of Industrial
Policy and Promotion (DIPP).

12.  Prime Minister Mr. Narendra Modi launched the Skill
India initiative – ‘Kaushal Bharat, Kushal Bharat’.
Under this initiative, the government has set itself a
target of training 400 million citizens by 2022 that would
enable them to find jobs.
 Pradhan Mantri Kaushal Vikas Yojana (PMKVY)
 Skill Loan Scheme is designed to disburse loans of Rs
5,000 (US$ 75.3) to Rs 150,000 (US$ 2,260) to 3.4
million Indians planning to develop their skills in the
next five years.
Government Initiatives

13.  The Government of India has launched the National
Web Portal for promotion of National Apprenticeship
Scheme for Graduates, Diploma holders and 10+2
pass-outs vocational certificate holders.
 The Japan International Cooperation Agency (JICA)
will train bureaucrats from the HRD ministry.
 digital employment exchange
 government initiatives are being adopted to boost the
growth of distance education market, besides focusing
on new education techniques, such as E-learning and
M-learning.
 Vidya Lakshmi (www.vidyalakshmi.co.in), for
students seeking educational loans.
 National Policy for Skill Development and
Entrepreneurship 2015.

14. Foreign Direct Investment
 The Indian economy requires FDI to fill the gap between
domestic savings and investment and to boost productivity- and
investment-led growth.
 Although Indian FDI policy has been progressive, inflows have
been far lower than expected and lag behind those of
competitors like China.
 Low levels of investment and trade, combined with decelerating
growth, have been causes for concern in India.
Financial sector

15. Some of the factors that affect FDI inflow to India are
1- inadequate infrastructure,
2- inflexible labor markets,
3- difficult land-acquisition procedures,
4- lack of progressive FDI reforms, and
5- lack of center-state coordination.
 The post-liberalization period since 1991 has been remarkable
in many ways because it has created a significantly more
positive environment for foreign investors. While only 29
countries invested in India in 1991, India currently has more
than 130 FDI source countries.
 Major investors in India include Mauritius, the United States,
Singapore, the United Kingdom, the Netherlands, and Japan.
Mauritius alone accounts for more than 40% of India’s FDI.

16.  Major FDI inflows have come into the manufacturing and services
sectors, and a number of industries received a good amount of FDI
between 2000 and 2014,
 construction ($23 billion)
 telecommunication ($14 billion)
 computer software and hardware ($12 billion)
 drugs and pharmaceuticals ($11 billion)
 automobiles ($9.8 billion)
 chemicals ($9.6 billion)
 power ($8.9 billion)
 and electronics equipment ($3.3 billion)

17.  Foreign Direct Investment in India increased by 3743 USD
Million in December of 2015.
 Foreign Direct Investment in India averaged 1127.37 USD
Million from 1995 until 2015, reaching an all time high of 5670
USD Million in February of 2008 and a record low of -60 USD
Million in February of 2014.

18.  India stands as the fourth most attractive destination for FDI in
E&Y's global ranking (dropped 2 places from year before).
Sector Amount
(USD)
Services 5.05 billion
Pharmaceuticals 3.21 billion
Telecom 1.99 billion
Construction 2.52 billion
Power 1.61 billion
Metallurgical 1.76 billion
Country Amount
(USD)
U.S 11.2 billion
Mauritius 9.42 billion
Singapore 5.07 billion
Japan 2.86 billion
UK 2.75 billion
Germany 1.54 billion
Cyprus 1.42 billion

19. Indian banking sector
Indian banking sector credit growth has grown at a
healthy pace
• Total credit extended went up to US$ 1,089 billion by FY15
• Credit to non-food industries increased 9.75 per cent to US
1,073.4 billion in FY15, from the previous financial year
• Demand has grown for both corporate and retail loans.

20. Banks lending rate
 Bank Lending Rate in India remained unchanged at 9.70 percent
in January from 9.70 percent in December of 2015.
 Bank Lending Rate in India averaged 13.90 percent from 1978
until 2016, reaching an all time high of 20 percent in October of
1991 and a record low of 8 percent in July of 2010.

21. • India recorded a Government Debt to GDP of 66.10 percent
of the country's Gross Domestic Product in 2014.
• Government Debt to GDP in India averaged 73.66 percent
from 1991 until 2014, reaching an all time high of 84.30
percent in 2003 and a record low of 65.80 percent in 2013.
India Government Debt to GDP

22. India GDP annual Growth Rate
 The Indian economy expanded 7.3 percent year-on-year in the last
three months of 2015, slowing from an upwardly revised 7.7 percent
growth in the previous quarter but in line with market expectations.
 GDP Annual Growth Rate in India averaged 6.04 percent from 1951
until 2015, reaching an all time high of 11.40 percent in the first
quarter of 2010 and a record low of -5.20 percent in the fourth quarter
of 1979.

23. India Imports
 Imports to India dropped 11 percent year-on-year to USD 28,710
million in January of 2016, following a 3.88 percent fall in the
previous month.
 While oil purchases slumped 39 percent, gold imports surged 85.2
percent. Imports in India averaged 6564.39 USD Million from 1957
until 2015, reaching an all time high of 45281.90 USD Million in
May of 2011 and a record low of 117.40 USD Million in August of
1958.

24. India Exports
 Exports from India fell 13.6 percent to USD 21,080 million in
January of 2016.
 It is the 14th straight month of decline, as non-petroleum
exports declined by 10.55 percent to USD 19,116 million.
 Exports in India averaged 4473.03 USD Million from 1957 until
2015, reaching an all time high of 30541.44 USD Million in
March of 2013 and a record low of 59.01 USD Million in June
of 1958.

25. Balance of trade
 India recorded a USD 7639 million trade deficit in January of
2016, lower than a USD 7872 million gap a year earlier and
reaching the smallest shortfall since February of 2015.
 Exports fell 13.6 percent to USD 21,080 million, the 14th
straight month of decline, as non-petroleum exports declined
by 10.55 percent to USD 19,116 million.
 Imports dropped 11 percent year-on-year to USD 28,710
million, following a 3.88 percent fall in the previous month.
While oil purchases slumped 39 percent, gold imports surged
85.2 percent.
 Balance of Trade in India averaged -2091.30 USD Million
from 1957 until 2015, reaching an all time high of 258.90
USD Million in March of 1977 and a record low of -20210.90
USD Million in October of 2012.

27. Challenges that India faces in financial sector :
 Reducing the fiscal deficit, to reduce the risk of
macroeconomic instability and to increase the availability of
finance to the private sector;
 Improving the legal, regulatory and supervisory frameworks,
in order to improve banks’ credit and risk management;
 Improving systems for dealing with weak banks;
 Developing capital markets further,
 Developing pensions and insurance to increase finance for
long term investments, including infrastructure;
 Improving financial services to improve the welfare of
customers and meet the challenge of globalization of financial
services; and
 Managing links to external capital markets;

28. Infrastructure in rural areas
 Rural development may be defined as structural changes in the
socio-economic situation to achieve improved living standard
of low-income population residing in rural areas and making
the process of their development self sustained.
 Development of rural areas is slow due to improper and
inadequate provision of infrastructure with compare to urban
areas. That’s why rural share in GDP is always less.

29. Rural Development
 Infrastructure plays a crucial role for not just the country’s
economic growth but also its progress in human development.
Rural areas account for a larger part of the geographical area in
India.
 Census 2011 reports that there are 6.4 lakh villages in India,
which shelter more than two-third of the country’s population.
Provisioning of basic infrastructure facilities for this large
section of the population spread across 3.28 million square
kilometer of the country’s geographical area has been a major
challenge.

30. Roads
 India has developed a reasonably wide road network in the last
few decades. World Road statistics 2009 says that India’s road
density is 1.25 km/sqkm (2008), which is higher than that of
China’s 0.36 km/sqkm (2007) and Brazil’s 0.20 km/sqkm (2004).
 As far as rural India is concerned, the road network has been
increased from 3,54,530 lakh km in 1971 to 42,50,559 lakh km
in 2012 ( including 10,61,809 lakh km roads constructed under
Jawahar Rozgar Yojana and Pradhan Mantri Gram Sadak Yojana)

31. Power
 Electricity has become a necessity for every household. The
governments at the Centre and States have been trying to push
various reforms in power sector in order to provide Electricity
to people at affordable prices.
 The aim to provide “Power to all by 2012” has not been
fulfilled. According to the Central Electricity Authority,
Government of India, a total of 5,56,633 villages have been
electrified, which stands at 84% of total villages in the country
at present.
 By the start of 2015 a the total villages electrified were raised
to a total of 5,96,286 and is expected to cover 90% by the end
of 2017.

32. Housing
 The housing conditions in rural India have not improved much.
According to Census 2011, as much as 20.7 percent of the total
206 million (or 20.6 crore) occupied rural houses are with
thatched roofs.
 The government has taken various measures for building rural
India, some of these measures were: Indira Awas Yojana (IAY),
Rural Infrastructure Development Fund (RIDF) by the National
Bank for Agriculture and Rural Development (NABARD) and
Rural Housing Fund by the National Housing Bank, these
schemes aim at promoting rural housing in the country.

33. Education
 The 8th All India School Education Survey (AISE) report shows
that there are 6.75 lakh primary schools functioning in rural areas
in the country. It presents a picture that on an average every
village in India has a primary school.
 The survey reports that there are 3.04 lakh upper primary, 82.8
thousand secondary and 36.9 thousand higher secondary schools
along with 1.18 thousands degree colleges in the rural belt of
India.

34. Indian Agriculture
 Provides about 65% of the livelihood
 Accounts for 27% of GDP
 Contributes 21% of Total Exports, and Supplies Raw
materials to Industries
 Growth Rate in production - 5.7%
 Food grains production – 211.17 mt

35. Agriculture
 GDP From Agriculture in India increased to 5131.90 IND
Billion in the fourth quarter of 2015 from 2986.92 IND Billion
in the third quarter of 2015.
 GDP From Agriculture in India averaged 3931.33 IND Billion
from 2011 until 2015, reaching an all time high of 5217.45
IND Billion in the fourth quarter of 2013 and a record low of
2715.05 IND Billion in the third quarter of 2011.

36. What is Digital India?
 Digital India is a Programme to prepare India for a knowledge
future.
 The focus is on being transformative – to realize IT + IT = IT
 The focus is on making technology central to enabling change.
 It is an Umbrella Programme – covering many departments.
 It weaves together a large number of ideas and thoughts into a
single, comprehensive vision so that each of them is seen as part
of a larger goal.
 Each individual element stands on its own. But is also part of
the larger picture.
 The weaving together makes the Mission transformative in
totality

37. The Programme:
Pulls together many existing schemes.
These schemes will be restructured and re-focused.
They will be implemented in a synchronized manner.
Many elements are only process improvements with
minimal cost.
The common branding of programmes as Digital India
highlights their transformative impact

38. Vision of Digital India
Centered on 3 Key Areas
 Digital Infrastructure as a Utility to Every Citizen
 Governance & Services on Demand
 Digital Empowerment of Citizens

39. Nine Pillars of Digital India
1. Broadband
Highways
2. Universal Access
to Phones
3. Public Internet
Access Programme
4. E-Governance –
Reforming
government through
Technology
5. eKranti –
Electronic delivery
of services
6. Information for
All
Electronics Manufacturing
7. Electronics
Manufacturing –
Target NET ZERO
Imports
8. IT for Jobs
9. Early Harvest
Programmes

40. Future of globalization
 By 2025 the India's economy is projected to be about
60 per cent the size of the US economy.
 The transformation into a tri-polar economy will be
complete by 2035, with the Indian economy only a
little smaller than the US economy but larger than that
of Western Europe.
 By 2035, India is likely to be a larger growth driver
than the six largest countries in the EU, though its
impact will be a little over half that of the US.

41. Future Prospect
 India has good Information Technology , Communications,
Financial Skills.
 India needs sound regulatory environment , good conditions for
capital account convertibility .
 Good prospect in the education sector.
 Good scope for tourism ,Health & Care .
 Improve conditions for trade in the country.
 Realise that competition is good for a country’s growth and
prosperity .

42.  Foreign companies should not be discriminated .
 Encouraging open debates before implementing policies.
 Foreign & Regulatory