India infrastructure projects set to boost economy

[ScienceRocks]

India infrastructure projects set to boost economy

The Indian government has approved infrastructure projects worth 1.83tn rupees ($28.4bn; £17.7bn) to revive the economy and boost the falling rupee.

Finance Minister P Chidambaram said 36 stalled projects in oil, gas, power, road and railways sectors were cleared.

"The message we are sending is that the investment cycle has restarted, and we are pushing it," he said.

The announcement came on a day the rupee hit a new record low, touching 65.6 against the US dollar.

Recent attempts to reduce volatility in currency markets have so far failed to have any result.

BBC News - India infrastructure projects set to boost economy

 

[Vikrant]

I have given it a considerable thought to figure out why India's currency is undervalued. India produces great deal of products that include pretty much anything from spacecrafts to needles. Yet, the currency is undervalued. I reached the conclusion long time ago that the culprit was India's infrastructure. No body wants to hold on to Indian currency because they cannot live in India. They cannot live in India because the infrastructure there sucks. I am just glad that finally Indian government has figured that out.

 

[Ropey]

I have given it a considerable thought to figure out why India's currency is undervalued. India produces great deal of products that include pretty much anything from spacecrafts to needles. Yet, the currency is undervalued. I reached the conclusion long time ago that the culprit was India's infrastructure. No body wants to hold on to Indian currency because they cannot live in India. They cannot live in India because the infrastructure there sucks. I am just glad that finally Indian government has figured that out.

Indeed Vikrant. India is a far less wealthy country than US, China, Germany, Russia, Denmark and many other countries. The total deposits of the Indian government in international market shows this and it's seen that although India has financial liquidity, they lack in financial capital and the infrastructure for the social reforms necessary to challenge the massive corruption and demand social accountability.

INDIA Last Updated: June 27, 2013

International Reserves and Foreign Currency Liquidity (Information to be disclosed by the monetary authorities and other central government, excluding social security)

International Reserves and Foreign Currency Liquidity

Because of this and the vast corruption, the Indian government almost always works with fiscal deficits and thus has negative growth GDP with regards to annual spending. India is under a huge burden of debt and so in a social sense, the issue is not even about India's collective capital, it is about the capital without which many Indians die of hunger and lack of medical facilities collectively.

 

[Vikrant]

Foreign investment is good but it is not going to be the salvation of billion plus Indians. Ultimately, it is the resources of India which will have to lift India. As far as the government is concerned, it cannot make its people rich. This applies to any country in the world. The duty of the government and Indian government is not an exception, is to provide security and infrastructure conducive to growth. If Indian government can do these two things, it will have carried out its responsibility.

In 1947 when India became free, it took some policy decisions, some of them were good and some of them were ill conceived. The ill conceived decision was to downgrade Indian military which jeopardized India's security which was demonstrated by China in 1962. The good decisions were plans to setup factories with a goal of industrial self reliance. This yielded considerable benefits for India.

Agriculture was a mess in India up until 60s. Things started improving from that point on. They built things like irrigation canal. This along with hybrid seeds, increased the yields big time. But there is a lot that can be done in agriculture sector that needs to be done, things like land consolidation and laws that prohibit waste of agricultural lands. I do not think there is much that can be done for the people in rural areas beyond that at least at this stage.

The urban infrastructure is a mess and it needs an urgent attention. This can only be fixed through proper taxation. There will not be any foreign investment without the sound urban infrastructure. Once you have the sound infrastructure (rural and urban), you will live well with or without the foreign investments.