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IT'S THE ECONOMY, STUPID .. how green was my valley

Now, this blog does not hark back to the sentimental past, nor take the mantle of the aggrieved loser. While talking of the 'economy' , these are simply not done.

Unlike political power, economic power need not be seen as a zero-sum game but more like a contagion effect with prosperity spreading in concentric circles.

Until 1000 AD, India had an incredibly prosperous economy constituting to around 33% worlds GDP or 1/3 of the whole world. India was producing about 25% of global industrial output throughout the 1st century AD to up until mid 18th century.

India experienced de-industrialisation and cessation of various craft industries under British rule, which resulted in India's share of the world economy declining. This decline from 24.4% in 1700 to 4.2% in 1950, and its share of global industrial output declining from 25% in 1750 to 2% in 1900 is well documented.

In contrast, highest world growth occurred during post-war reconstruction. Global nominal income expanded to $1 trillion by 1960 & $10 trillion by 1980. Therefore the ₹ - $ exchange rate is another story. From ₹ 0.09 (to 1 $) in 1900, 10.10 in 1983, 22.74 in 1991, 41.26 in 1998, 53.44 in 2012, 70.09 in 2018 to 81.94 now !! So, if we were among the poorest in 1900 or so, the USA was not apparently too much ahead at that point. Something specifically seems to have happened after World War II ended in 1945, when the world left us so behind that we are just playing catch up after 75 years. We were independent, after 1947, so we have no one else to blame!

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