NYT: The Next Industrial Giant Is ... India?

[DeepModem Mom]

The Next Industrial Giant Is ... India?
By KEITH BRADSHER
Published: August 31, 2006

....For decades, India had followed a route to economic development strikingly different from that of countries like Japan, South Korea or China. While its Asian rivals placed their bets on manufacturing and exports, India focused on its domestic economy and grew more slowly with an emphasis on services.

But all that is starting to change.

India's annual growth in manufacturing output, at 9 percent and accelerating, is close to catching growth in services, at 10 percent. Exports of manufactured goods to the United States are now rising faster in percentage terms than China's, although from a much smaller base. More than two-thirds of foreign investment in the last year has gone into manufacturing in India, not services....

***

Indeed, in interviews at 18 Indian factories and other businesses in 10 cities and villages scattered across the length and breadth of the nation, the picture that emerges is of a country that is being driven by advances in manufacturing to a much brisker pace of economic growth.

A prime reason India is now developing into the world's next big industrial power is that a number of global manufacturers are already looking ahead to a serious demographic squeeze facing China. Because of China's "one child" policy, family sizes have been shrinking there since the 1980's, so fewer young people will be available soon for factory labor....

http://www.nytimes.com/2006/08/31/business/31cnd-rupee.html?adxnnl=1&pagewanted=all&adxnnlx=1157068890-4foTjQ8y8J3p/ttA5n6jig

[RangerSmith]

1. In 20 yrs or so

we'll be the worlds third economy behind China and India.

I don't have a real problem with that at this time.

[DavidDvorkin]

4. Fourth, if the EU succeeds

Or even lower on the charts, due to nations rising to the top that we now don't think of as top contenders. Brazil, perhaps.

[muntrv]

2. That's because India embraces science, unlike the bushies who wage

war against it.

[muesa]

3. This is very true

and when you graduate as an engineer or scientist you are not burdened with massive debt.

[Bhaisahab]

5. "fewer young people will be available soon for factory labor"

isn't that what this is all about? who will win the sweat factory race - India or China?

[bhikkhu]

6. having adopted peak-oil-tinted glasses...no

India's great strength is its low per-capita oil dependence. Building an industrial infrastructure in India, such as we have here in the US or such as China has recently done, is unlikely to happen. For one, resources are finite, and only becoming more so during the time scale necessary. There is only so much room at the trough and oil access has already become an issue capable of starting wars, and viciously competitive diplomacy. Without oil, there is no industrialization, and India has been shut out of the game.

For my part, I see this as a blessing to them, the second most populous contry in the world. In the event of a global "hard landing" of accumulating resource crises, India may be very well positioned.