Year on year GDP growth in India came in at its lowest rate for nine years this quarter. At 5.3 per cent, it's hardly stagnation, but compared to where they were, it's a real slowdown. Slate's Matt Yglesias worries that this is symptomatic of a cooling off of growth across the BRICS:
The slowdown in India, which remains a much poorer country than China, is very alarming. Even as its economy surged recently, the country did little to raise the productivity of the agricultural sector in which most Indians work. The Indian government had a promising idea on that score: to open the retail sector to foreign firms such as Wal-Mart and Carrefour. Large international chains have experience working with farmers in more productive countries and could be the mechanism for transferring better methods to Indian growers. That could have meant higher agricultural wages and better living standards for India’s urban poor. But faced with pressure from incumbent retailing interests, the government backed down from the plan. That was both a lost opportunity and a blow to the confidence of foreign investors. . .
The Chinese growth dynamo that rescued the world economy after the financial crisis isn’t going to reappear this time around. That means the stakes as Europe confronts the ongoing meltdown of its banks and America faces the prospect of a new debt ceiling standoff are higher than ever. The bad economic news of 2008-09 came with the major silver lining that growth continued in the places that needed it most. This time around, if the rich countries can’t get our act together, the whole world will spiral into recession.