India is now officially the world’s fastest-growing large economy, as well as the world’s most populous country. But New Delhi’s sights are set still higher. The country’s finance ministry released a report at the end of January confidently predicting that India, currently the world’s fifth-largest national economy (excluding the supra-national EU), will climb up to third position by the end of the decade. A number of major US private financial institutions have since endorsed this forecast, highlighting India as a top investment opportunity, especially given mainland China’s de-prioritisation of high growth and disengagement with western capital.
Far less attention has been paid to an even more ambitious goal stated by India’s chief economic adviser during the original report’s release. Anantha Nageswaran announced that the government intended to achieve “developed” country status by 2047, a century after independence from the UK. In order for this to happen, India’s Human Development Index (HDI) status will have to climb from medium, past high, to very high. Similarly, per capita incomes would have to increase sevenfold from lower-middle income status to reach the high-income bracket.
This is a far, far harder task than increasing the overall size of the economy, in part because one has very little automatic impact on the other. Despite steady growth in the size of India’s economy (both in absolute terms and relative to other countries) over the past three decades, India’s current ranking for inequality-adjusted HDI (IHDI) is 108 out of 156, and 132 out of 190 in terms of per capita income. In other words, although most Indians have been lifted out of dire poverty, their incomes, education levels and life expectancies remain very modest in comparison to the average person born into a highly developed economy.
Although the contrast in India’s case is particularly extreme, the underlying problem is near-universal. Decades of evidence shows that turning a developing middle-income country into a developed high-income one is far, far harder than lifting up low-income countries into middle income. This is known as the “middle-income trap”, which even China, although close, is not yet certain to escape. Despite decades of explosive growth, China still only ranks 61st in the world for per capita income, and 67th for IHDI. And now, between the shrinking size of China’s ageing workforce and its new non-growth-focused policy framework, it is unclear how much forward momentum the country has.
Per capita incomes would have to increase sevenfold to reach the high-income bracket
But making sense of development in India is complicated by the fact the country has some of the largest internal regional disparities to be found anywhere in the world, and rapid economic growth has only widened these differences. The state of Goa, for example, has the highest per capita income in India, comparable to Colombia and Ecuador, which are “upper-middle income” countries. This figure is almost ten times that of Bihar, which puts the state at the level of “low income” countries like Eritrea and the Democratic Republic of the Congo. Tragically, average life expectancies correspond with those disparities: Goa’s is at 73.3 years, and Bihar’s is almost a decade shorter.
The problem is that India’s highest-income and most developed areas, like Goa, are amongst its smallest. Although India has 36 states and union territories, the twelve largest states together hold 80 per cent of the national population. Tellingly, none of these big states, including star performers like Gujarat, Maharashtra, Tamil Nadu and Karnataka have climbed above lower-middle income status and a medium level of HDI. Given that Bihar’s population of 130 million is almost 10 times that of Goa, even big gains by Goa (like moving from “high” to “very high” levels of HDI) do very little to lift India as a whole. This means India must focus its efforts on the places where the bulk of its population lives in order to make dramatic overall improvements.
Uttar Pradesh, India’s most populous state, with close to a quarter of a billion people, has particularly low levels of income, life expectancy and education, as do neighbouring Bihar and Madhya Pradesh. These three adjoining states hold a staggering 450 million people together and represent the largest cluster of poverty, illiteracy, malnutrition and lower life expectancy in India.
Although the central government has significantly expanded welfare schemes such as health insurance, and is increasingly enabling online enrolment, physical access remains highly problematic. Transport networks remain highly underdeveloped, and while primary schools and clinics are insufficient and badly under-resourced. In many cases, marginalised populations have been conditioned by dominant ones to not compete with them for access. It is hard to imagine progress of the kind envisioned until the complex challenges of these three states in particular are tackled, requiring not just the reallocation of resources, but reforms to governance structures and the involvement of grassroots social movements.
But if accelerating development in these highly challenged regions does in fact become a top-level policy priority at the state and central government levels, India does enjoy three major enablers. As noted in one of my earlier columns, the government and Reserve Bank have done an outstanding job of maintaining stability in the face of global economic volatility, while much of South Asia has struggled to remain afloat.
Second, India’s combination of high growth and a large, young labour pool provide tremendous potential, especially if training and education are made available. And third, mobile broadband penetration India’s massive investment in digital public infrastructure paves the way for those even at the bottom of society to benefit from inclusion with banking, education, governance and a rapidly expanding welfare net.
India’s escape into broad-based prosperity is far from impossible, but it is certainly not inevitable either. Sustained efforts by every level of government require broad-based public support. India’s voters (the country is in an election year), especially relatively well-off ones, must understand these policies as a vital element of India’s long-term economic success, rather than dismiss them as populist pandering.
One of the most important elements of the escape from the middle-income trap is the transition from state-led and export-led growth to domestic consumption-led growth. That kind of spending by individuals and families is simply not possible until hundreds of millions more Indian households can experience financial security, which in turn is not possible without access to health, education and a regular income.
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SPECS
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UAE currency: the story behind the money in your pockets
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UAE currency: the story behind the money in your pockets
The burning issue
The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE.
Read part four: an affection for classic cars lives on
Read part three: the age of the electric vehicle begins
Read part one: how cars came to the UAE
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
Power: 420hp
Torque: 623Nm
Transmission: 10-speed automatic
Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)
On sale: Now
KILLING OF QASSEM SULEIMANI
Children who witnessed blood bath want to help others
Aged just 11, Khulood Al Najjar’s daughter, Nora, bravely attempted to fight off Philip Spence. Her finger was injured when she put her hand in between the claw hammer and her mother’s head.
As a vital witness, she was forced to relive the ordeal by police who needed to identify the attacker and ensure he was found guilty.
Now aged 16, Nora has decided she wants to dedicate her career to helping other victims of crime.
“It was very horrible for her. She saw her mum, dying, just next to her eyes. But now she just wants to go forward,” said Khulood, speaking about how her eldest daughter was dealing with the trauma of the incident five years ago. “She is saying, 'mama, I want to be a lawyer, I want to help people achieve justice'.”
Khulood’s youngest daughter, Fatima, was seven at the time of the attack and attempted to help paramedics responding to the incident.
“Now she wants to be a maxillofacial doctor,” Khulood said. “She said to me ‘it is because a maxillofacial doctor returned your face, mama’. Now she wants to help people see themselves in the mirror again.”
Khulood’s son, Saeed, was nine in 2014 and slept through the attack. While he did not witness the trauma, this made it more difficult for him to understand what had happened. He has ambitions to become an engineer.
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Produced: Sajid Nadiadwala and Phantom Productions
Directed: Vikas Bahl
Cast: Hrithik Roshan, Pankaj Tripathi, Aditya Srivastav, Mrinal Thakur
Rating: 3.5 /5
Mohammed bin Zayed Majlis
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Spider-Man: No Way Home
Director: Jon Watts
Stars: Tom Holland, Zendaya, Jacob Batalon
Rating:*****
The five pillars of Islam
1. Fasting
2. Prayer
3. Hajj
4. Shahada
5. Zakat
TRAP
Starring: Josh Hartnett, Saleka Shyamalan, Ariel Donaghue
Director: M Night Shyamalan
Rating: 3/5
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THE CLOWN OF GAZA
Director: Abdulrahman Sabbah
Starring: Alaa Meqdad
Rating: 4/5
What are the main cyber security threats?
Cyber crime - This includes fraud, impersonation, scams and deepfake technology, tactics that are increasingly targeting infrastructure and exploiting human vulnerabilities.
Cyber terrorism - Social media platforms are used to spread radical ideologies, misinformation and disinformation, often with the aim of disrupting critical infrastructure such as power grids.
Cyber warfare - Shaped by geopolitical tension, hostile actors seek to infiltrate and compromise national infrastructure, using one country’s systems as a springboard to launch attacks on others.
The Voice of Hind Rajab
Starring: Saja Kilani, Clara Khoury, Motaz Malhees
Director: Kaouther Ben Hania
Rating: 4/5
ONCE UPON A TIME IN GAZA
Starring: Nader Abd Alhay, Majd Eid, Ramzi Maqdisi
Directors: Tarzan and Arab Nasser
Rating: 4.5/5
Lexus LX700h specs
Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor
Power: 464hp at 5,200rpm
Torque: 790Nm from 2,000-3,600rpm
Transmission: 10-speed auto
Fuel consumption: 11.7L/100km
On sale: Now
Price: From Dh590,000
What are the influencer academy modules?
- Mastery of audio-visual content creation.
- Cinematography, shots and movement.
- All aspects of post-production.
- Emerging technologies and VFX with AI and CGI.
- Understanding of marketing objectives and audience engagement.
- Tourism industry knowledge.
- Professional ethics.
NYBL PROFILE
Company name: Nybl
Date started: November 2018
Founder: Noor Alnahhas, Michael LeTan, Hafsa Yazdni, Sufyaan Abdul Haseeb, Waleed Rifaat, Mohammed Shono
Based: Dubai, UAE
Sector: Software Technology / Artificial Intelligence
Initial investment: $500,000
Funding round: Series B (raising $5m)
Partners/Incubators: Dubai Future Accelerators Cohort 4, Dubai Future Accelerators Cohort 6, AI Venture Labs Cohort 1, Microsoft Scale-up
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MOUNTAINHEAD REVIEW
Starring: Ramy Youssef, Steve Carell, Jason Schwartzman
Director: Jesse Armstrong
Rating: 3.5/5
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UAE players with central contracts
Rohan Mustafa, Ashfaq Ahmed, Chirag Suri, Rameez Shahzad, Shaiman Anwar, Adnan Mufti, Mohammed Usman, Ghulam Shabbir, Ahmed Raza, Qadeer Ahmed, Amir Hayat, Mohammed Naveed and Imran Haider.
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The Gandhi Murder
- 71 - Years since the death of MK Gandhi, also christened India's Father of the Nation
- 34 - Nationalities featured in the film The Gandhi Murder
- 7 - million dollars, the film's budget
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
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War 2
Director: Ayan Mukerji
Stars: Hrithik Roshan, NTR, Kiara Advani, Ashutosh Rana
Rating: 2/5
Killing of Qassem Suleimani
Killing of Qassem Suleimani
'Outclassed in Kuwait'
Taleb Alrefai,
HBKU Press
Kathryn Hawkes of House of Hawkes on being a good guest (because we’ve all had bad ones)
- Arrive with a thank you gift, or make sure you have one for your host by the time you leave.
- Offer to buy groceries, cook them a meal or take your hosts out for dinner.
- Help out around the house.
- Entertain yourself so that your hosts don’t feel that they constantly need to.
- Leave no trace of your stay – if you’ve borrowed a book, return it to where you found it.
- Offer to strip the bed before you go.
The Settlers
Director: Louis Theroux
Starring: Daniella Weiss, Ari Abramowitz
Rating: 5/5
Analysis
Members of Syria's Alawite minority community face threat in their heartland after one of the deadliest days in country’s recent history. Read more
Business Insights
- Canada and Mexico are significant energy suppliers to the US, providing the majority of oil and natural gas imports
- The introduction of tariffs could hinder the US's clean energy initiatives by raising input costs for materials like nickel
- US domestic suppliers might benefit from higher prices, but overall oil consumption is expected to decrease due to elevated costs
Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
December 9: UAE joins the United Nations.
UAE currency: the story behind the money in your pockets
Community Shield info
Where, when and at what time Wembley Stadium in London on Sunday at 5pm (UAE time)
Arsenal line up (3-4-2-1) Petr Cech; Rob Holding, Per Mertesacker, Nacho Monreal; Hector Bellerin, Mohamed Elneny, Granit Xhaka, Alex Oxlade-Chamberlain; Alex Iwobi, Danny Welbeck; Alexandre Lacazette
Arsenal manager Arsene Wenger
Chelsea line up (3-4-2-1) Thibaut Courtois; Cesar Azpilicueta, David Luiz, Gary Cahill; Victor Moses, Cesc Fabregas, N'Golo Kante, Marcos Alonso; Willian, Pedro; Michy Batshuayi
Chelsea manager Antonio Conte
Referee Bobby Madley
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Mohammed bin Zayed Majlis
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'Lost in Space'
Creators: Matt Sazama, Burk Sharpless, Irwin Allen
Stars: Molly Parker, Toby Stephens, Maxwell Jenkins
Rating: 4/5
Specs
Engine: 51.5kW electric motor
Range: 400km
Power: 134bhp
Torque: 175Nm
Price: From Dh98,800
Available: Now
Company profile
Name: Steppi
Founders: Joe Franklin and Milos Savic
Launched: February 2020
Size: 10,000 users by the end of July and a goal of 200,000 users by the end of the year
Employees: Five
Based: Jumeirah Lakes Towers, Dubai
Financing stage: Two seed rounds – the first sourced from angel investors and the founders' personal savings
Second round raised Dh720,000 from silent investors in June this year
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