Right time for India to exploit its economic advantages – former IMF director

The South Asian nation will provide the world with human capital and know-how, Surjit Bhalla has told RT

The time is opportune for India to exploit its economic advantages globally, a former IMF director has said.

New Delhi’s comparative advantage “is labor as well as openness, [and] democracy,” Surjit Bhalla told RT India in an exclusive interview.

“If you take China out, India is the second fastest-growing economy for the last 30 years,”  he told Salman Khurshid in the latest episode of In Conversation.

One of the least recognized events for policymakers is the supreme decline in fertility globally, he said.

India still is at an advantage, “thanks to the fact that we are reaching the fertility decline a bit later than China,” Bhalla added.

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“We will supply human capital to the world, we will supply labor to the world, and we will supply know-how. So I think there’s a perfect union,” he said. “GDP per capita growth is relevant, [and though] India has done well, better than any country, except China, we can do much better.”

He noted that India has been conservative in its monetary policy.

Private investment in India has gone down, and foreign direct investment as a percentage of GDP in India is at the same level as it was in 1990, Bhalla said.

In 2025, Indian stock markets showed the lowest increase relative to its peers, he noted. Bhalla cited this as the reason why a trade deal with the US “is absolutely necessary to bring the market back into our decision-making rather than bureaucrats taking … economic decisions.”

He also noted that China has enormously benefited from the rest of the world.

“So the rest of the world is now in a position of how do we stand up to this dragon in economic policies,” he said.

Bhalla cited a unique situation in which most countries, including India, have a trade deficit with China, while posting a surplus with the US.