'THE PESSIMISTS HAVE BEEN PROVEN WRONG'

Ruchir Sharma, Founder of Breakout Capital and Chairman of Rockefeller International, talks about the global outlook from an India perspective, and what is working or not working for the country

- RAHUL KANWAL

The world is going through a period of flux. One person whose assessments have wielded immense influence over investors at such volatile times is Ruchir Sharma, Founder of Breakout Capital and Chairman of Rockefeller International. In a freewheeling interview in New York with Rahul Kanwal, News Director of India Today and Aaj Tak, and Executive Director of Business Today, Sharma talks about what India has done right, where it can improve and on the prospects of the northern neighbour, China. Edited excerpts:

Q: Till a few years ago, governments were talking about double-digit growth rates. Now, 6.5 percent is all policymakers are talking about. Is 6.5-7 percent the new normal?

A: If you look at India's growth trajectory over the last 40-50 years, you [will] find a very tight fit with what's happening globally. When we had this extraordinary boom in the 2000s, where the Indian economy did grow at 9 percent or so, the global economy was booming... growing at about 4 percent or so; emerging markets, in general, were growing at 7 percent. In the current era, the global economy's growth rate has slipped to about 2.5 percent, and in the entire history of India's economic development, the country's economy, on a sustained basis, has never been able to grow more than about three percentage points faster than the global economy. So, what's the logical conclusion? That [if] the global economy is going to grow at 2-2.5 percent, then for the Indian economy to grow much faster than 5.5-6 percent is extremely difficult. It's never been done before.