Annual meeting of World Economic Forum commenced on 23 January 2018, at Davos. This meeting is
attended by world’s top CEOs. A large number of heads of governments also attend this meeting. PM
Modi attended this meeting and has been treated like the chief guest. He has already interacted with 60
CEOs including 42 global conglomerate chiefs. Last time when an Indian Prime Minister attended this
meeting was in 1997. Nearly one hundred Indian CEOs and policy makers are are also attending this
meeting. India Theme will be one of the focus areas this time. There will be many conference sessions
around this India Theme. At present world business community has shown interest to invest in India
provided some of the reservations are clarified. India will try to court the global business community and
will invite them to invest in India.
World Economic Forum (WEF) is an international body and a Swiss nonprofit foundation. It is committed
to improving the state of the world by engaging business, political, academic, and other leaders of
society to shape global, regional, and industry agendas. Its annual meeting is attended by top business
leaders, international political leaders, economists, and journalists to discuss the most
pressing issues facing the world. The meeting lasts for around four days. This annual meeting is
supposed to be a neutral platform and is used as such by political leaders.
At Davos PM Modi will try to put India at pole position to attract investment. PM Modi in his inaugural
speech has highlighted the following:-
(i) Countries like USA are becoming inward focused. New taxes are being imposed to curb
imports. This is huge risk for globalization. This anti globalization tendency is as damaging as
terrorism and climate change.
(ii) PM Modi highlighted the policy changes made by the Indian Government. As per him India is
ready to roll out red carpet for FDI, by removing red tape.
(iii) PM Modi is showcasing India as a counterpoise to US and China. He has told the
international investors that India position on climate change, terrorism and protectionism is
better than those of US and China.
(iv) His slogan was “Come to India if you want Wealth & Wellness. Come to India if you want
Prosperity with Peace.”
(v) During his speech Modi brought out that during last three years nearly 1300 central and
state laws have been repealed. The rules should be such that there should be no need for
businessmen to visit government officials. The government considers industry as a partner.
Indian economy present and future
Now let us have a look at the Indian economy in context of this annual meeting of WEF. As per a study
by Center of Economics and Business Research (CEBR), India will emerge as world’s third largest
economy by the year 2018. Setbacks have been caused by demonetization and introduction of GST. Yet
the Indian economy has already caught up with that of UK and France in dollar terms. Now a very
encouraging trend is emerging. It is expected that by the year 2032, five of the ten largest economies
will be from Asia. The European country economies have started moving down the ranking ladder. USA
will certainly lose its first ranking to China in coming years. Use of technology and rapid urbanization will
be key actors which will reshape world economy.
Economic growth in India
India is the world’s seventh largest economy as of now. Though in dollar terms it is lagging way behind.
Consider the following data about GDP of following countries as percentage of Global GDP:-
(i) USA – 24.32% ($ 18 Trillion)
(ii) China – 14.84% ($ 11 Trillion, more than five times higher than India)
(iii) Japan – 5.91% ($ 4.4 Trillion)
(iv) Germany – 4.54% ($ 3.3 Trillion)
(v) United Kingdom – 3.85% ($ 2.9 Trillion)
(vi) France – 3.26% ($ 2.4 Trillion)
(vii) India – 2.83% ($ 2 Trillion)
(viii) Italy – 2.46% ($ 1.8 Trillion)
From the above it is clear that India is the seventh largest economy. However GDP growth of India
slumped recently to 5.7% in June 2017 quarter due to effect of big reforms like demonetization and GST.
The growth has been hit due to these disruptive changes. But the Indian economy is already recovering
from the negative impact of demonetization and the rollout issues linked with GST. Most recent data
shows that the Indian economy grew at 6.3% in July – September 2017 quarter. International Monetary
Fund forecasts that the Indian economy will grow by 7.2% in the year 2017 and by 7.7% in the year 2018