Yet in recent months, the mood in the planet’s most-populous democracy has soured badly—to the point where even some of India’s richest people have begun to complain that things are seriously amiss.
No one is disputing that the boom has created huge wealth for the business elite and much better lives for hundreds of millions of people. But the benefits of growth still haven’t spread widely among India’s 1.2 billion residents. And a string of corruption scandals has exposed an embarrassing lack of effective governance.
Recently, Azim Premji, chairman of software-services giant Wipro Ltd., described the situation as a “national calamity.”
Mr. Premji and 13 others—business leaders, retired Supreme Court justices and former governors of India’s central bank—laid out their complaints in January in an open letter to “our leaders.” “It is widely acknowledged that the benefits of growth are not reaching the poor and marginalized sections adequately due to impediments to economic development,” they wrote.
This wasn’t supposed to be the picture 20 years after India abandoned its Soviet-style, centrally planned economic model, embraced capitalism and jump-started economic growth. Historic reforms begun in 1991 held out the promise of transforming the country from an agrarian backwater into an industrial powerhouse, lifting almost everyone’s standard of living in the process. Other Asian nations, including China and South Korea, have traveled that path successfully.
India enjoyed years of heady growth, despite problems its East Asian peers didn’t share, such as its deep caste divisions. Now, though, a host of problems has stalled the transformation.
The public-education system is a shambles. No significant publicly owned businesses have been privatized in years. The promised modernization of the financial system has happened only in fits and starts. Land reform needed to stimulate industrialization has been a political nonstarter. And malnutrition remains widespread.
India’s fate is vital to the U.S. and other Western powers, which view the nation as an important and growing export market, a stabilizing force in a dangerous region, and a counterweight to a surging China