SECRET BEHIND INDIA'S BOOMING ECONOMY

 As China's economy growth slows, people are looking for the next big driver of growth. And India seems to fit the bill. The IMF estimates that India will be the fastest growing major economy in the world this year, which is why companies like Walmart are paying top dollars for the business deals in India. It's projected to expand by 7.4%, putting it ahead of China. So, what's driving India's growth?

India has a population of 1.3 billion, making it the second most populous country in the world. It's on track to grow faster, even surpassing China's population by 2024. And that big population is also really young. India is on track to reap a handsome demographic dividend. The effects happens when a country's working age population is larger than the non-working age population. By 2050, India is expected to have a working population of more than one billion. While many Asian countries are aging, India's population has a medium age of only 27.3 years, compared to China 37.6 and Japan 47.1.
               

Since Prime Minister Narendra Modi came into power in 2014, his government has attracted record foreign direct investment. Modi has been credited for his strong reform agenda to improve India's business environment. The World Bank gave a nod to his efforts, improving India's ranking in its Ease of doing business from 130 to 100. But the India's growth is like cricket game - full of promises, but it hasn't quite delivered yet. India grew faster than China between 2014 and 2016, but lost its fastest-growing major economy title last year.
                  
Within the country, domestic investments has fallen as businesses have been hesitant to invest. India's exports have also dropped since Modi came into power, despite his Made in India campaign meant to fire up the country's manufacturing industry. Economist says that domestic development are to blame. In November 2016, the government's withdrawal of 500 and 1000 rupee notes shocked the country. 86% of the country's currency could no longer be used in shops. Then, while businesses were trying to recover from that policy, the government implemented the goods and service tax in July 2017. It's the biggest tax reform since India's independence, consolidating India's many taxes into a single structure. The two policies on tax and demonetization hit consumption and investment hard, despite most economist agreeing to that the GST will bring long-term benefits to India.

 This year is likely to keep its title as the world's fastest major growing economy. But is faster fast enough? Former IMF chief economist and India's former RBI governor, Raghuram Rajan has said that India needs to grow much faster. He added, "India has about one million people entering the labor force every month. So that's a big number that has to be absorbed which means we need significantly more growth to get them good jobs." More than 25 million people, a number greater than Australia's population, applied for less than 90,000 jobs on India's state-run railways. Many multi-national companies are excited about India, dreaming about selling fast food, smartphones and fast fashion to a rapidly growing middle class. The double whammy of a weaker currency and growing oil prices are going to hit India hard. Despite its challenges, India continues to grow quickly. But will it be fast enough to benefit its people?