While Australian businesses still regard the Indian economy as relatively closed, the Australian Government predicts 2035 to be different. According to the report, ‘An India Economic Strategy to 2035 – Navigating from Potential to Delivery’ by Peter N. Varghese Australia must come up with an investment strategy to entice India. “There is no market over the next twenty years which offers more growth opportunities for Australian business than India.” The report recommends that Australia should strive by 2035 to lift India into its top three export markets. Moreover, the land down under contends to make India the third largest destination in Asia for Australian outward investment.
Australia’s relationship with India is a long haul journey. The report highlights the transforming Indian economy as a golden opportunity. “India is a market which requires patience, perspective and preparation. Change in India is often invisible to the naked eye.” This is one of the reasons the Australian business community was unaware of the significant positive changes taking place in India.
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The report describes India as too complicated for its growth story to be linear. “Its economic progress will be uneven and incremental, constrained by the political compromises demanded by a diverse democratic federation, held back by thinly resourced institutions, burdened by a bureaucracy too susceptible to arbitrary interference, dented by endemic corruption and shaped by a political tradition.”
The report recommends the Australian Government to look beyond India’s constraints. “India needs to be understood on its own terms. It will always march to its own tune. Comparing India with China, the report states that the drivers of Indian economy are deeply structural and sustainable. It includes the urbanization of the world’s largest rural population and the gradual movement of the informal economy into the formal economy. “These structural drivers will keep India on a relatively strong growth path.” It is the structural complementarity between the Indian and Australian economies which is the key to translating ambition into opportunities.
India becoming the world’s most populous country by 2035 means a deep domestic market. This will much likely make India the world’s third largest economy by 2035 after China and the United States.