Emerging Markets’ Growth Fuels Confidence to Claim Bigger Say in Global Policy Making

Emerging Markets’ Growth Fuels Confidence to Claim Bigger Say in Global Policy Making

Discussion

Emerging markets are nations with social or business activity in the process of rapid growth and industrialization. Currently, there are around 28 emerging markets in the world, with the economies of China and India considered to be the largest.

India ranks among the well known emerging markets in the global economic scenario. Since the economic liberalization policies were undertaken in the 1990s, emerging market India has really prospered which has helped to boost the Indian economy to a great extent.

In simple terms, emerging market is used to evaluate the socio economic scenario of the country in terms of the growth of the market and industrial development. According to the recent survey, there are around 28 emerging markets in the world out of which India ranks in the second place.

The main factors behind this booming emerging market are the economic liberalization and the perfect competition market, the high standard of living and per capita income, the development of medical facilities and infrastructure, the increase in foreign investments and so on. Over the few years, there has been a significant growth of the Indian market which has resulted in the high Gross Domestic Product (GDP). The average annual growth rate ranges between 6 to 7 %. The growth rate of GDP was around 6.7 % during the financial year 2008-09.

To boost the emerging market India, the government is also taking some positive steps. The main aim is to increase the growth rate to around 9 %. Due to the favorable emerging market, more and more industries are being set up and the customer base is also increasing. Currently, India is the 4th largest economic system in the world in terms of the purchasing power parity.

The recent economic development has also put a positive impact on the various sectors. There has been a significant development in the agricultural, service and industrial sector in the country. Today, to complement the rapid pace of economic growth, the service sector contributes around 54 % of the annual Gross Domestic Product.

Conclusion

The pendulum of power to make policies seems to be shifting towards the emerging market economies like India, China and Brazil. For instance, the voting rights of emerging market economies is set to grow in UNO. China and the ten ASEAN countries have established a free trade zone combining 1.9bn people and eliminating tariffs on 90% of their traded goods. This is likely to reinforce the redirection of trade flows involving China from which more goods will flow to the rest of the world. China has overtaken Japan as the Second Largest economy in the world and India is the fourth largest economy as on now and it is expected that it will become the second largest by 2050. Meanwhile, bilateral and regional free trade agreements are proliferating fast as an alternative to a global (WTO) agreement.One can expect the internationalization of the Renminbi (RMB). It is expected that sooner or later RMB may be linked to a currency basket (in which the US dollar probably will have less weight).

Considering the above it can be surely said that in future the Emerging Markets’ Growth will Fuels Confidence to Claim Bigger Say in Global Policy Making.