It was during my recent India trip that I went in to meet several businesses in software,
infrastructure, engineering,food and chemicals. What struck me was the enormous number of young people employed and the vibrancy of 7% growth that India is reporting. Lower than the 9% growth that India was experiencing but not bad.It sure felt different – the secret is that most of the demand is internal to the country and conservative central banking practices have largely insulated India from the financial sector problems. You simply don't get a loan if you don't have the margin money and if you and your neighbor cannot prove that you have a job or viable income to pay back. The stodgy ways of Indian systems seem to have paid off for once.
Indians travel around a lot globally these days and a favorite transit is Dubai and I was shocked to learn that all construction is stopped in Dubai. This topic came up in casual conversation at a major coal supplier's office who had recently been in Dubai. Why was this – I asked and apparently this is because of the global slowdown,decline in oil prices and general slowdown in trade which is Dubai's forte.
Caterpillar , very involved with construction and infrastructure,was at the back of my mind and sure enough it is in the news today reporting a 18% workforce cut in the US. Clearly this recession is global and particularly hard for countries where internal demand is generally at low growth levels. India and China might still save the day and let's hope that the Chinese New Year of the Ox brings better luck in 2009.