Aerospace Diary

FARNBOROUGH AIR SHOW  »  2014 by    NEELAM MATHEWS July 14, 2014, 7:00 AM A slowdown in reforms in India over the past five years–and a virtual pause in procurement–may be about to change following renewed optimism and confidence as the new government shows, for the moment at least, that it is serious. As hectic activity takes place in the ministries of commerce, finance and defense, increasing manufacturing, exports and foreign direct investment ( FDI ) are focus areas of the new regime. A proposal to increase  FDI  levels from the present 26 percent to 49 percent, and possibly later, 74 percent for transfer of production (build to print) and 100 percent in the case of a single-source-hub transfer, including transfer of technology, is being viewed with interest. While India has moved steadily in automobile and automotive components manufacturing, with auto giants leveraging the country’s strengths in  I...

By   Derek Scissors, Ph.D.      The Heritage Foundation Thursday was a really bad day for the Indian economy. Gross domestic product (GDP) growth for the October–December quarter came in at 4.5 percent, continuing to weaken. Worse, the central government budget for the next fiscal year leaves India on the same, failing course it’s been on of  undisciplined spending  and unrealistic expectations.   First, GDP. GDP is a measurement of economic activity, not economic prosperity, and it is badly understood and used in describing performance. It is certainly possible for India to report 4.5 percent GDP growth in a healthy economy, even if this is a far cry from the pre-crisis pace.   However, the Indian economy is not healthy.  Consumer inflation  remains above 10 percent, where it has been for years. More attention is paid to the wholesale price index, but it is consumer inflation that bears more directly on buying power. T...