India Feels Pressure as Growth Rate Is Worse Than Predicted:
Many analysts have been arguing that the best way for policy makers to respond to slowing growth is further liberalization of India’s economy, large parts of which are still heavily regulated. The government could, for instance, make it easier for foreigners to invest in industries like retail, aviation and insurance that need more capital.
But the government, led by the Indian National Congress Party, has struggled to pass unpopular measures in recent months because of opposition from its coalition partners and political rivals. Last year, it indefinitely deferred a plan to allow foreign supermarkets into the country after a coalition partner threatened to pull out if the change went through.
To be frank I think the strategy of export-driven nations like China shows that state-directed capitalism is not always a failure (one could argue that the earlier East Asian “miracles” used the model). But this sort of internal state-protected capitalism doesn’t do much good over the long term. India, Europe, and the USA are all suffering dysfunctions right now because of the lack of alignment between the needs of a market economy and the demands of the populace.