Why is India lagging behind in manufacturing


Harald Muller

To person

Dr. phil., born 1949; Professor for International Relations at the University of Frankfurt / M., Executive board member of the Hessian Foundation for Peace and Conflict Research (PRIF), Leimenrode 29, 60322 Frankfurt am Main
Email: [email protected]

Carsten Rauch

To person

Dip. Pol., Born 1976; research assistant at PRIF, (see above).
Email: [email protected]

How did India's rise? The text discusses the background and content as well as the successes and failures of the economic reforms that began in the early 1990s.


If more and more western observers have been calling India a great or even world power for some time, the explanation is apparently obvious: With the nuclear tests of 1998, India had the USA, Russia, China, Great Britain and France - the permanent members of the UN -Security Council - drawn level and rose to join the ranks of world powers. This direct link between nuclear weapons and global recognition, however, cannot adequately explain India's rise. For one thing, India has been a de facto nuclear power since 1974. The New Delhi nuclear test at the time was shamefully referred to as a "peaceful nuclear explosion". But that opened the gate to the deployment of nuclear weapons. This is how the international community saw it, which did not reward the Indian step with a gain in prestige, but reacted with severe sanctions, which to this day keep India away from the global civil nuclear trade. [1] At that time nobody spoke of India as a world power. A look at other nuclear powers outside of the Nuclear Non-Proliferation Treaty also shows that the appropriation of such weapons by no means results in the quasi-automatic attribution of the status of a great or world power. Neither Israel nor North Korea are associated with such a status. Even India's neighbor and long-term rival was never discussed as a "world power Pakistan" despite its nuclear tests in 1998.

So there must be other reasons why India, largely ignored by the West for 50 years, is suddenly seen as a major global player. The most important reason is the economic growth that has been sustained for years, which has achieved average growth rates of 6.4 percent since 1995 (since 2004 even 8.5 percent). Calculated according to purchasing power parity, India is now the fourth largest economy in the world. [2] How did India achieve this position, how robust is the Indian rise to be assessed and what can be expected from the future?