Not an elitist growth this, there are beneficiaries galore

Just 60 basis points short of the 10 per cent mark, the Indian growth juggernaut, at 9.4 per cent in 2006-07 compared to 9 per cent in the previous year, refuses to even pause...

Just 60 basis points short of the 10 per cent mark, the Indian growth juggernaut, at 9.4 per cent in 2006-07 compared to 9 per cent in the previous year, refuses to even pause for breath as it touches the trillion-dollar mark, the 12th country to do so. Powered by the predictable services and not-so-predictable manufacturing, it is Indian enterprise that is converting opportunities into growth, growth into profits, profits into wealth.

Surely, economic reforms have helped, as one sector after another opened up and allowed growth to ride on pent up, almost guaranteed demand. While that should have been a reason for celebration, what we have instead are signals of political panic, almost an apology for a feat never-before encountered — a high, sustained and rising (barring the one-time 11 per cent growth achieved during the October-December 2003 quarter) economic growth.

A growth which many citizens of this country are partaking of. That could be new entrepreneurs like Captain Gopinath who sold 26 per cent of Deccan Aviation (Rs 146) to Vijay Mallya yesterday, G M Rao who’s moved from textiles, banking and sugar to infrastructure and whose company GMR Infrastructure (Rs 495) is setting up the Delhi and Hyderabad airports, or tech professional Ashok Soota and his team who are converting their skill into wealth with the recent listing of Mindtree Consulting (Rs 770).

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But it’s not merely new enterprise powering this growth. Sniffing fresh opportunities and moulding themselves to it, older companies like L&T (Rs 2,013), Siemens (Rs 1,271), ICICI Bank (Rs 915) are on the prowl for opportunities as well. As are erstwhile stockmarket dullards, state-owned companies like Bhel (Rs 1,400), Concor (Rs 2,277), NTPC (Rs 159), all of which have seen their profits and market capitalisations multiply in this new growth era.

Almost a rebirth, a trillion-dollar economy, holding a trillion-dollar stock market in its womb is the best thing that could have happened to India — beyond the rhetoric and the expected high interest rates led slow down over the next two quarters, the trillion-dollar mark is also a trigger for more growth, more global money flowing in, more profits for companies and wealth for investors. Irrespective of how the UPA administration tries to smother it, this fantastic growth story needs to be sustained. Thousands of direct equity investors and millions of indirect investors through mutual funds and insurance companies have gained from this rebirth — and will continue to.

Of course, these gains need to be widened, more citizens have to be part of this growth story, benefit from it. But the route need not be ‘distributive justice’ through inefficient and corrupt mechanisms that have the stamp of proven failure etched on them. The route is to facilitate more households ride this growth. The easiest way: bring in pension reforms with equity embedded as a default option, and a whole nation including informal workers will become stakeholders in this growth. Apologetic politicians cringing because of this growth and terming a rising Sensex as elitist and non-inclusive, need to look beyond the Sensex to see these benefits.