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Economy will grow only when demand & supply will grow

Administrative Note:

Week's Agenda: Economy

It is so pathetic to see current world situation in where rich nations
are becoming richer and poor nations are becoming poorer. It was to my
utter shock when I came to US to see the difference in standard of
living that presently exists between India and US (could be any
developed nation). Here is what I came to conclusion after staying in
two different worlds for some time.

1. India is not as poor as it seems by calculating currency rates. For
e.g. a cup of coffee in india costs 5 to 10 Rs. which costs $0.50 in
US (equal to 21Rs). To rent and apartment in US costs $600/month
(24000Rs) which would be much cheaper in India. This leads to
conclusion that once the economy goes on right track, what really
counts is the potential of the economy and not the current values. So
If india has correct policies and enviornment set in which economy
will show growth, the net appriciation in values will be much higher
then the rate of growth itself. Kind of like stock market, which works
many times on future expectations then present realities.

2. The basic difference between strong economies and weeker one is
attitude of people. If your attitude standard is high the potential
for growth will be higher. For e.g. One's attitude in India toward a
begger is not great. People rarely see the point that he is also a
human being. While in US the media and education system has created an
standard which is inherently higher. By aiming at better standard only
one can achieve it. Just wondering around will not create one to grow.

3. Equally important aspect in growth is planning. One has to work on
creating demand and supply growth. There are lot of avenues in India
where demand can be created which will inturn give rise to more
production capacity and inturn improve the economy growth. Only thing
is making this demand visible is problem. One thing I could easily
point out is in US the urbanization is being done with great planning.
This requires one to build houses, roads, parks, schools, hospitals
etc... in equal proportion of population. This inturn creates so much
demand and jobs that helps economy grow faster.  What we need is some
strong disciplined planning which does not give into corruption.

Please comment on what you think.

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