NYT on India's Sizzling Economy

Looks like that 7% GDP growth number have caught people's eyes. Tomorrow's New York Times is a carrying a lead story on the sizzling Indian economy.

After growing just 4.3 percent last year, India's economy, the second fastest growing in the world, after China, is widely expected to grow close to 7 percent this year. The growth of the past decade has put more money in the pockets of an expanding middle class, 250 to 300 million strong, and more choices in front of them. Their appetites are helping to fuel demand-led growth for the first time in decades.

India is now the world's fastest growing telecom market, with more than one million new mobile phone subscriptions sold each month. Indians are buying about 10,000 motorcycles a day. Banks are now making $15 billion a year in home loans, with the lowest interest rates in decades helping to spur the spending, building and borrowing. Credit and debit cards are slowly gaining. The potential for even more market growth is enormous, a fact recognized by multinationals and Indian companies alike. In 2001, according to census figures, only 31.6 percent of India's 192 million households had a television, and only 2.5 percent a car, jeep or van.

Foreign institutional investors have poured nearly $5 billion into the Indian market this year, already more than six times last year's total. The Bombay Stock Exchange's benchmark Sensitive Index has risen by more than 50 percent since April, hitting a three-year high. Foreign exchange reserves are at a record $90 billion.

After huffing and puffing in place for eight or nine years, "the train has left the station," C. K. Prahalad, a professor at the University of Michigan Business School, said of the Indian economy.