What is SAARC's impact on Indian economy?

SAARC countries share same cultural history since centuries. In the economic terms they were interdependent up to the point but colonial rulers like British, Portugese, Dutch e.t.c shares the colonies and ruled them for their benefits. After the attainment of collective independence, India remained the largest country in all terms ahead of its neighbours. Because India is somewhat peaceful and had a stable political establishment since independence. No two SAARC countries share a boundary and all of them share a boundary with India. India is strong in economic perspective than other SAARC countries so they were not of much help to India.


Pakistan : It never completed the term of 5 years for any government except the recent one. Army, terrorists, internal conflicts e.t.c. hampers the growth of pakistan in every possible way. - Not helpful at all.

Bangladesh : In 1971 India helped it liberate and still the furore continues,  with the opposition trying to establish a islamic state. - Not helpful

Srilanka : LTTE war - relations degraded. But hosting the tamilians who stayed there. - Interests of Indians ( tamils and fishermen) are involved. Have to co-operate with them for greater development of tamil regions.

Maldives, Nepal, Afghanistan : Unstable and micro economies compared to India. India helped them with grants but never the other way around.

Bhutan : Complete dependence on India. 90% of exports to India.

Because of the low economic growth of these countries their help is very less compared to the help given by India. But these nations are handful in terms of population which are potential markets for exports of India. This is the reason MODI is emphasizing of peaceful and good trade relations with neighbours. With SAARC countries led by India and helping out each other for prosperous south asia. It could turn the tables in favour of India in global arena.

Is moderate inflation good for the economy?

Definitely. Inflation is just pressure that keeps money moving through the system. To have a vibrant economy, you want money to constantly be in action rather than stagnating. Of course, too much pressure is dangerousand the same goes for inflation. 

This leads to a few advantages. The main one is that it incentivizes people who have stuff (ie assets) to go out and actually put them to use. This way more things get done, which is generally beneficial for society. This means more money circulating, more people getting paid, more businesses making revenue, more taxes... All good things.

Another advantage is in fighting against a particular sort of cognitive bias: nobody likes their wages decreased. And yet, rationally, there are times when wages should be decreased. Luckily, this bias can be fooled by keeping the nominal wages the same: as long as the number stays the same, you're happy. Even if, in real terms, the number is actually worth less year over year!

Having more assets circulating also makes things more liquid. If people are more actively buying and selling, it's probably easier to buy or sell whatever you need. This makes doing actual business easier. The main point of the economy is to move necessary things between people who need them, which is exactly what liquidity helps with.

As an interesting detour, consider real estate. Generally, there is a fixed supply of land. You can't just create more, especially in the middle of a city! This means that land is inherently deflationary. If you have a prime spot of land in the middle of a city (but not enough resources to build anything), it would be in your interest not to sell this year, since it will be worth more in the future! But since you're not using it, everyone would actually be better off if you sold it. After all, we don't want our city centers full of empty lots! I figure this is one of the reasons we have property taxes, which can counter the deflationary nature of land and make it easier to buy and sell it.

This extra kick to make people use or sell valuable land—which is beneficial for the city as a whole—plays exactly the same role as inflation in general. We want to run our economy at a reasonable utilization, putting most of our resources to work most of the time. Inflation is a nice decentralized way of making this happen.

At the same time, inflation is not without risks. In some sense, it's an implicit tax on assets. Since government bonds are denominated in currency, inflation is like an extra source of revenue. This could allow a government to levy an extra tax even if it would be opposed, rationally or not. This (rightly) worries some people. However, it does not mean we should not have any inflation! It's just something important to consider.

Unrecoverabe damages caused by the Britishers

How often have we seen the Britishers being thrashed for looting all the wealth and using our human resources to Develop their own country? 

After pondering upon this topic and reading about the facts and figures, this has only left me with a dilemma. On one hand, while Britishers introduced so many policies and laws to divide India, they also gave us the fuel to unite on the same terms and fight against them. 

It's just a matter of perspective, not that I am in any way supporting the various destructive steps that Britishers took. But looking at the greener side, Britishers United us in a way that the entire country stands democratic and together today.

How has Indian youth developed themselves to rise up to become the highest population of English speaking youth? India is the largest democratic country and we do pride ourselves on our transport infrastructure, railways being on the top. 

Unrecoverable loss has been cause by them, but in the other light, let's not overlook the selfish motives which happened to become a changing  point for our nation. 

Growth vs Development

Being in Mumbai for a year has made me realise the major difference in the economic status of this country. You could go to the most expensive house in this city, that being Antilla and be surprised to see that its encircled by slums. 

This shows you the major battle India has been fighting. Economic growth which is taking place at a moderate rate is still much more than the development that can be seen. Numbers don’t speak in terms of the living standard that persists in this country. 

The development is taking place, but not at such a rapid rate. With growth being given such prime importance, it has increased in the previous few years and it can be seen that the PCI has been pressing issue that is undertaken by the government.

But is it enough to just concentrate on the numbers and not on the reality that we witness every day?

The emphasis is basically because the government feels that with the increase in the income of the people, they will be able to develop at a faster rate. Which, if you think more about it is not the only parameter of a developed country.
It has to be combined with other factors such as low infant mortality rate, more awareness, education and health facilities.

This is what is going to help us develop. To combine the numbers with the overall well being of the people.