Subir Gokarn: End of the India story?

Over the last year or so, several articles, research reports and a few books have been published, all of which essentially reach the same conclusion. The India growth story is real and here to stay. The acceleration in growth since 2003 reflected a structural shift in the economy's trajectory, which was triggered by the cumulative reform process having reached a critical mass. India may have to play second fiddle to China as far as growth is concerned, but it was an uncontested second and more and more people began to speak of China and India in the same breath. Of course, we know that all stories must eventually come to an end, even good ones, but the consensus was that this one had a pretty long way to go.

Unfortunately, just as the conviction about India's rosy future was beginning to entrench itself, things look like they are unravelling. The horrors of the past few weeks are vivid. Surging inflation, unprecedented oil prices, the fiscal situation threatening to slip out of control, foreign investment flows reversing and inducing the rupee to depreciate