Video #17 - India: Is Terrorism Hurting the Economy?
Tuesday, January 10, 2006BACKGROUND INFORMATION
For the first time since the late 1990s, the Indian economy is expected to achieve 6% growth in GDP this year, despite a growing fiscal deficit and lack of any real economic reform. Foreign investment is up fourfold as are measures of business confidence. Demand from a healthier global economy has played a role in India's economic boost. Most importantly, since almost half of India's GDP comes from agriculture, India had the most bountiful monsoon in many years.
Mumbai, a highly "Westernized" city, is India's financial capital and the base for its offshore oil industry. Five recent explosions in that city were directed at areas chosen for their economic significance - such as means of transport, prosperous activity or a very well-known hotel.
B. Raman, a former Cabinet Secretary, says that Mumbai: "...provides a vision of what the rest of India could be in years to come if the modernization and globalization policies of the government continue to make progress. It is the home of India's largest share market. It is a major contributor of the tax revenue of the government. Many multinational companies prefer to locate their corporate headquarters in Mumbai." Foreign investors see all of India through events in Mumbai. Mr. Raman blames Pakistan's Inter-Services Intelligence (ISI) for working to destabilize Mumbai as a means of weakening the Indian economy.
These events come at a time when the world is responding positively to India's economic potential. According to The Economist, a stock market surge has been unaffected by terrorism and unchanged fiscal policy. In early September, right after the bombings, the index covering the Mumbai Exchange had climbed more than 50% since April, reaching levels unsurpassed since February of 2001. Profits of companies included in the index were up by an estimated 50% in the second quarter of 2003, compared with the same period in 2002. However, the tense situation between Pakistan and India could put a damper on the continued flow of foreign investment.
India's economy has a lot of room for growth. In 2002, India's exports grew by 19.2%. The rupee has been appreciating against the dollar. Nevertheless, even with this rate of growth, India can still only account for just 0.8% of the world exports. In addition, 40% of India's 1 billion people still live in poverty (living on less than US$1 a day).
SOURCES
"India." Country Briefings. August 7 to September 17, 2003. www.countrybriefings.com
"Ready to roll (again)?" The Economist. September 18, 2003. www.economist.com/Story-ID=2073240 Baruah, Amit, "Talks with Pakistan only when terrorism end: PM." The Hindu. September 1, 2003. www.thehindu.com/2003/01/09/stories/2003010908220200.htm
Bhatia, Shyam; "British MPs 'deeply impressed' by Indian economy." October 14, 2003. www.deiff.com//news/2003/oct/14uk.htm
Raman, B. "Mumbai blasts: Target - the Indian economy." Asia Times. www.atimes.com
GRADE LEVEL/SUBJECT: 10/12 Economics, International Relations, World History, International Baccalaureate Programs (IB), Current Events.
LESSON PLAN
PURPOSE: To present activities to be used in a variety of classroom situations in order to enhance student understanding of the Asian economy and its significance globally.
OBJECTIVES: Students will be able to:
- Describe the state of the Indian economy.
- Illustrate the effect of terrorism on the Indian economy.
- Analyze the role of India in the Association of South East Asian Nations (ASEAN).
- Forecast the future of India's economy.
MATERIALS:
- Background information provided./li>
- Resources on India available at your school's Media Center and the Public Library System in your area./li>
- Background information available through Internet "search engines."
ACTIVITIES:
May be assigned as group activities or as individual tasks. They may also be designed as preparation for related presentations either by individuals or groups.
- Use charts and graphs to illustrate the state of the Indian economy.
- Divide the class as Pakistani and Indian citizens. Research the unresolved issues between them and write resolutions to resolve them. Hold a "Summit" between Indian and Pakistani "officials" using the resolutions prepared by either side and broker solutions to problems between the two countries. i.e. nuclear weapons, terrorism.
- Investigate terrorist activity in India. Analyze the government's response to such crimes. Compare these events to those in other parts of Asia. Write an editorial recommending solutions to this problem.
- Create a timeline of events linking India to the ASEAN. Evaluate the economic results of ASEAN activity in the region.
EVALUATION:
Individual assignments should be graded by the teacher using established criteria.
Group activities, presentations and projects may be evaluated by teachers and students using the following criteria and scale: Content 1 = Superior (A) Creativity 2 = Excellent (B) Clarity 3 = Good (C) 4 = Fair (D) 5 = Poor (F)
To print this lesson plan:
If your browser does not print frames, try this -- click the right button on your mouse and select "Open Frame In New Window." Then use your browser's print function to print that page. Another option -- choose "Select All" from your browser's pull-down Edit menu. "Copy" the highlighted text and then "Paste" it into any text editor. You can then print it from the text editor.
