Modinomics and Its Implications for Korea - India Cooperation

Abstract

The government of India is pushing ahead with a series of economic reform policies, named ‘Modinomics’ after Prime Minister Narendra Modi, focusing on high growth and business-friendly environment. Modinomics emphasizes the virtuous circle of investment that promotes employment and consumption, which induces additional investment. The government of India has been concentrating on improving the business environment by easing or removing various regulations related to investment, and also by establishing reliable and efficient governance. The government of India has especially placed a priority on attracting private and foreign investment to infrastructure development and manufacturing sector promotion, based on key policies of Modinomics, such as smart cities, the development of the Industrial Corridor, and the Make in India campaign. As a part of his increasingly active ‘sales diplomacy’, Modi has visited several countries, including Japan and China; holding summit meetings with the leaders and receiving promises of massive investment. As a result, the government of India secured investment commitments of 35 billion and 20 billion dollars, respectively, from Japan and China. Japan, in particular, has been pushing forward with the development of 11 industrial zones, a rapid transit railway, and a smart city.