Never Mind Europe. Worry About India.By TYLER COWEN
Published: May 5, 2012
THE economic slowdown in India is one of the world’s biggest economic stories, but it is commanding only a modicum of attention in the United States...
India may not be alone in this slowdown. There is a more general worry that the grouping of disparate giants known as the BRIC nations — Brazil, Russia, India and China — has, for some reason, lost much of its previous momentum. Last year Brazil grew at only a 2.7 percent rate, down from 7.5 percent, and Chinese and Russian G.D.P. growth are slowing too, to an unknown extent and duration. In the past, many countries engaged in catch-up growth have suddenly slowed and hit plateaus, although economists do not have firmly established theories as to when and why this happened. In any case it remains a real danger.
In the short run, we often focus on headlines, elections and fights between personalities and political parties. But the world is shaped by deeper structural forces, such as resources, technologies, demographics and economic growth rates. We ignore India’s troubling trends at our peril.
Good addition. It is hard to sustain the awesome growth rates we are seeing from the BRIC nations, and them catching a cold might kill smaller economies.
Thomas Sowell: There are no solutions, just trade-offs.
