India is set to become a global leader in technology services as software companies move up in the value chain, while the weak dollar has hurt the US economic recovery, the Chairman and CEO of business publisher Forbes said.
“You have to make the distinction between pumping in money in immediate emergency response to the near collapse of the financial system and when the immediate crisis is over,” Steve Forbes, 62, told Reuters, when asked what he made of the US government’s response to the worst global economic crisis since the Great Depression.
“This year I think the US government has made a number of mistakes that has slowed the recovery. They’ve not reduced taxes in terms of the dollar, they have not stabilized the dollar. They’ve weakened the dollar which hurts business investments, hurts the flow of capital and small businesses,” he said.
“So the government is prolonging the crisis – we should have had a strong recovery instead,” Forbes said, adding that not enough was being done for job creation.
The pace of economic growth in India proved that the country was able to weather the crisis well but the government would have to work to make the economy grow further, he said.
The Indian economy rose 6.7 % in 2008/09, while it is expected to rise 6 % in the current fiscal year.
“India should continue the liberalization that began in 1991, including simplifying the tax code and reducing tax rates, and allowing more overseas investments into India,” he said.
He said the bureaucratic procedures should be simplified to facilitate entrepreneurs.
“One step – done!”
India also needed to reduce the hurdles to building infrastructure, he said.
While it would take decades for India to become a competitor to the US it had the capacity to be global leader in certain areas such as technology services.
“They are global players in certain areas, they will be leaders,” he said. He said that companies such as Tata Consultancy Services, India’s top software exporter and its smaller rival Wipro were already undertaking complex software projects.
After the Indian government opened up the media sector to foreign investment several overseas publications, including Forbes have made their entry into the country. The Indian edition of Forbes was launched earlier this year in a joint venture with the Network18 group, which also runs business news channel CNBC TV18.
Forbes said he was encouraged by the positive response to the magazine in India and some more products such as Forbes Lifestyle and Forbes Women would be launched some months down the line.
In response to a question on US President Barack Obama winning the Nobel Peace Prize for 2009, he said, “There were no achievements I think it was more a reaction to George Bush’s foreign policy.