The Indian Growth Acceleration: A Brazilian Demand-led Insight

Abstract

With an average GDP growth rate of more than 6% India was one of the most dynamic economies in the twenty-first century. The conventional narrative stresses on the success of the New Economic Policy (NEP) implementation since 1990s as a process of liberalization and global insertion of Indian economy that caused growth. Introducing some nuance on this conceptualization, the main objective of this article is to discuss on the drivers of the Indian GDP growth between 1990 and 2015 from a Brazilian demand-led approach, paying main attention on the role of autonomous expenditures. Particularly, after clustering some Indian growth interpretations and data, the Brazilian debate between Furtado and Tavares is used to discuss the Indian growth acceleration. This blend of Brazilian and Indian authors and conceptual contributions is original in nature. Without ignoring the export contribution, we point out the relevance of upper class/cast ‘autonomous’ consumption (fueled by credit boom and real wage smooth increase), residential and government gross domestic capital formation (GDCF) and anticyclical fiscal policies.