The Indian economy continues to grow rapidly, taking in its stride poor harvests and rising oil prices. Industrial output, which had tended to be relatively low, has increased to double-digit levels, accompanied by rising levels of savings and investment. India’s healthy export performance has resulted in increased amounts of foreign exchange reserves, insuring against a large balance of payments (BOP) deficit in the future. An important factor in this process has been India’s relative political stability. Democracy is well entrenched and changes of government occur reasonably peacefully.

Is there a fly in the ointment? Could the growth process slacken or can it be accelerated further? What are the constraints to maintaining a high rate of growth over the next decade or two? These questions acquire special significance as we try to understand long-term growth in the current context of global economic slowdown. The papers in this volume seek to answer these questions.