An emerging market economy is the economy of a developing nation that is becoming more engaged with global markets as it grows. Countries classified as emerging market economies are those with some, but not all, of the characteristics of a developed market. As an emerging market economy progresses it typically becomes more integrated with the global economy, as shown by increased liquidity in local debt and equity markets, increased trade volume and foreign direct investment, and the domestic development of modern financial and regulatory institutions. Currently, some notable emerging market economies include India, Mexico, Russia, Pakistan, Saudi Arabia, China, and Brazil.Critically, an emerging market economy is transitioning from a low income, less developed, often pre-industrial economy towards a modern, industrial economy with a higher standard of living.

India’s journey as an emerging economy can be traced back to the landmark economic liberalization of 1991 aimed at making the economy more market-oriented and expanding the role of private and foreign investment. More than 25 years later, at $2.6 trillion, India emerged as the sixth largest and the fastest growing major economy in the world, contributing almost 3.2% of world GDP.According to recently released global forecasts by Capital Economics, India has the potential to deliver growth of 5-7% for the next 20 years. This implies the economy would triple in size and double its share of global GDP, becoming the third largest economy in the world, surpassed only by the US and China.”

Question:

What are the key characteristics of emerging economies shared by India? Examine the impact of evolution of other emerging economies on the business and economic environment in India. Also, examine the advantages of India, if any, over other emerging economies which may lead to faster growth of the Indian economy in near future.

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Key characteristics of emerging economies shared by India include 1 Economic liberalization Like other emerging economies India has implemented economic reforms aimed at reducing government interventi... View the full answer