Author: Rajiv Kumar, Head of ICRIER, New Delhi

These are unprecedented times. The post independence generation in India gets to experience its first real financial sector crisis and near meltdown. Thank the Lord that it is elsewhere where a trillion dollars is less than one eighth of the GDP! This will hopefully add to its growing confidence by realizing that ‘they in the developed west’ can also make mistakes, can falter and are not infallible.

The success of India’s software and outsourcing industry had, to our great surprise, already seen senior economics professors in the US questioning the merits of liberal and open economies. Now we see a theologically devout Republican President of the US urging the Congress to pass a bill that would effectively nationalize large parts of the financial sector, having already taken into government care the world’s largest insurance company by pumping in $85 billion of taxpayers money. Read more…