I read this on Economic Times and I couldn’t but write a post on it.
The piece says, India was by far the largest borrower from two World Bank institutions, accounting for $3.75 billion, or 15 percent of their total lending as the bank group globally committed $34.3 billion in fiscal year 2007.
It’s not under my proficiency to criticize and say why India is the largest borrower despite showing a tremendous economic growth rate, surging capital inflows and increased earnings through taxes. At least from the taxes front, I know for sure that it’s more streamlined than ever. In such a situation, I thought India have had reduced her borrowings in the recent times and would have been making it to zero over a period of time; 2020 may be!
But one may not forget that due to the trickling effect (!) only less of these funds reach the needy poor, for eradicating poverty, for providing basic infrastructure, education etc. Majority of which end up in the deep and ravenous pockets of the needy rich, politicians, middlemen! Well, that could be one of the reasons why more such funds are encouraged to flow from organizations such as World Bank to India every year, even today.
I also read experts saying 15% GDP growth will eradicate poverty in India.
Which one India should adopt to eradicate poverty? Working hard to make the GDP grow 15% or working hard to borrow from World Bank and make our debt a perpetual one?