ABSTRACT
Even as the rest of the world remained hesitant to perceive an end to the worst economic recession since the Great Depression of the 1930s, analysts in India were beginning to strike a note of optimism by August 2009.1 In the previous decade anticipating the rapid and sustained growth of the Indian economy, powered by high-performing service and information technology industries, had become a favorite pastime of boosters, commentators, and even critics. This enthusiasm seemed to be shared by summiteers declaiming at Davos, and backroom analysts in Wall Street. Like most such positive evaluations, a recent report marked the economic reforms of the previous decade as a crucial turning point. But it also went on to note that “there has been a structural increase in India’s potential growth rate since 2003 on the back of high productivity growth.” The report went on to assert that this growth is likely to continue over the next decade and more (Poddar and Yi 2007, Rodrik and Subramanian 2004).
