Challenges in Indian Financial Sector to become Economic Super Power in the Coming Decade
Journal Title: International Journal of Engineering, Science and Mathematics - Year 2011, Vol 1, Issue 1
Abstract
Presently India is borrowing heavily from World Bank and ADB for Government Projects. The Private ventures are looking for FDIs but the ceiling is restricted by government policy. Hence a considerable fiscal from GDP is diverted towards interest or dividend towards these finances. High inflation and global recession are adding to considerable fiscal deficit making the funds more volatile and costly. High inflation and delays in completion are resulting in huge cost over runs thereby rendering the ventures less profitable. PPP models are also highly affected by local demands, making them less attractive for investment. PPP consortiums are mostly having Indian partnerships to bare minimum, thereby keeping them away from all strategic decision process. Most of these PPP Consortiums outsource most of the project execution to parent firms outside India, hence least beneficial to Indian corporate. The corruption and scams have pushed India‟s credit rations to the rocks bottom (CWG). The political instability due to coalition government also reduced India‟s credit ratings. Most of the ventures are shadowed by local politics, making them less credible for future investment. Delayed reforms in Direct and Indirect Taxes have made the corporate ventures more defensive towards global initiates.
Authors and Affiliations
M. S. Vasudev and K. M. Nagendra
Keywords
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