ET2013 ⁽⁶⁾

Reinforced by major additional reforms in the late 1990s and early 2000s, growth of the GDP and trade saw a massive shift.Read full article When the end to investment and import licensing and substantial tariff reductions led to only modest acceleration in GDP and trade in the 1990s, critics derided the reforms for having made little difference. But that changed in the 2000s. Reinforced by major additional reforms in the late 1990s and early 2000s, growth of the GDP and trade saw a massive shift. Trade expanded so fast that despite a rapidly-rising GDP, they climbed from 27% of GDP in 1999-2000 to 56% in 2011-12. But whereas a rising share of manufactures in the economy has led the economic transformation in every other successful country, this share has remained unchanged around 16% in India during the last 20 years. The causes of this disappointing performance of manufacturing are to be found in the lack of complementary reforms in factor markets — labour and land — and the inability of the government to build infrastructure. But misdiagnosis of the problem has…