IS INDIA AS EMERGING WORLD POWER

 With a storied ancestry that includes the Indus Valley culture which, beginning 4,500 years ago, rivaled all other civilizations for more than a millennium - India, say economists and international observers, is emerging from the world's shadows to become a global player in trade, technology, and political influence.

One of the most striking changes in India observed during three weeks of travel, from Kerala in the south to this capital of 17 million people in the north, was the country's new tone: a vocabulary of confidence, a word used over and over to describe today's Indian psyche.

"India now has the confidence of a rising power. It has become part of the long-term global balance of power," said C. Raja Mohan, an analyst and editor of The Indian Express Newspapers. "The world is going to be a very different place in the next 20 years, and the US, India, and China - not Europe - is where the action is going to be economically."

And yet, India, home to more than 1 billion people, remains beset by great poverty and great challenges. Pigs root out trash in city streets; cows wander onto highways. Power cuts occur daily even in the wealthiest neighbourhoods. Sewage flows down the ancient alleyways of Udaipur in the western Rajasthan region; airports fall apart; and 36 per cent of the population cannot read or write .

The hope is that the country's economic reforms - undertaken in 1991, more than a decade after China began its market reforms will annually lift millions of people out of wretched conditions. The reforms have gradually liberalized markets, encouraged a wider role for private enterprise, and removed regulations from many industries such as software and biotechnology. From 1951 to 1991, India's governments, strongly influenced by the Soviet economic model, had put controls over the economy, stagnating growth.

I believe that the growth of markets is the best way to create prosperity, and that is what is happening here. Of course, it's not going to happen across the board, all at one go. It's going to be uneven. But our middle class - I call them the 'scooter class, or those who can afford scooters is growing incredibly fast.

Recent figures support his measured optimism. Since

1991, India's economy has grown an average of 6 per cent a

year, and economists say the country is poised to stay at 7

per cent to 8 per cent growth for the next decade. In 1981, India's middle class was about 8 per cent of the population, or 65 million people. Today, the middle class is believed to number 25 per cent of the population, or more than 250 million people. Foreign direct investment is at $5.5 billion, up from $100

million in the early 1990s. Indian expatriates, according to

one study, have sent more than $24 billion in remittances

home annually in recent years, more than any other national

group does. Consumer spending is skyrocketing. Annual car sales have leaped from 150,000 in 1991 to more than 1 million today. India's airline industry, which was one of the first to be deregulated in 1991, has gone from one state-owned airline to eight competing carriers. Passenger traffic is expected to grow by 20 per cent annually over the next five years.

At the Hyderabad Central Mall, a huge sign at the entrance reads, "Shop, Eat, Celebrate!" and one of the first stores inside is Britain's upmarket Marks & Spencer. Billboards light up the night sky of the south-central Indian city of 5.5 million people, advertising computers, cellphones, low-cost airlines, and a hospital proclaiming that its "cardiac care equipment compares with what we have in America!"

In Hyderabad, Bangalore, and Mumbai in a time zone 10 1/2 hours ahead of the US East Coast, scores of call centre operations open after dark, so that they can answer queries from Americans nearly half a world away. The explosion of such outsourcing centres can be explained by economics: Analysts estimate such services costs 40 per cent less in India, largely because of lower labour costs.

Some of the boom is a direct result of multinational companies making huge investments. JP Morgan Chase, the US bank, announced late last year that it would be moving 30 per cent of its back office and support staff to India in the next two years, and planned to hire 4,500 graduates in India. Last December, Bill Gates, Microsoft Corp. chairman, said on a trip to India that his company planned to invest $1.7 billion in India over the next four years - the highest ever investment in India's information technology sector to date, doubling Microsoft's workforce in the country.

The proliferation of small businesses also is playing a huge role in the country's economic growth. In one high- rise building in New Delhi filled with hundreds of small start-ups, travel agent Ravneet Kler and two of his friends have built a strong business through word of mouth and the Internet.

"I go on Yahoo chat, it's amazing," Kler said excitedly one day recently in his cramped office. "It's instant. I go through a client's trip step by step, getting feedback and approval. It means I can compete with anyone, anywhere in the world. I'm starting to do a lot of Americans' trips around India, in part because of the technology."

Still, India's global advantage of having hundreds of thousands of well-educated English speakers may eventually fade because the educational system is not producing enough trained professionals to keep up with the boom, according to analysts. The concern stretches from hiring enough call centre operators to finding top executives. "CEOs in short supply as India booms," read a recent headline in the Times of India.

The Indian economy is today the second fastest growing major economy in the world with a growth rate of 9.2% at the end of the second quarter of 2006-2007. When measured in terms of purchasing power parity (PPP), the Indian economy is the third largest in the world with a gross domestic product (GDP) of US $3.666 trillion. When measured in US $ exchange rate terms, it is the twelfth largest in the world with a GDP of US $719.8 billion (2005).

In 2003, economists at Goldman Sachs presented a much quoted paper, "Dreaming with BRICS," which argued that by 2050, the economies of Brazil, Russia, India, and China (BRICs) would eclipse the US and Japan in wealth. generation and produce 40% of the world's GDP. By 2025, according to the report, BRICS could account for over half the size of the G6. If the economic predictions reach target, the world's largest democracy will also soon become one of its largest economies, an accomplishment enabled by longstanding institutions of open society, public higher education, and a multilingual labor force equally adept in English and in HTML.

How has a country that was an abject colonial economy less than 60 years ago achieved its current global muscle? How might we renew an understanding of India's development from its five-thousand year history to its recent interventions in the world stage? And, perhaps most importantly, what role do India's "products"-such as business, science, technology, and politics, but also film, literature, music, architecture, philosophy, religion-play in fabricating the country's new global presence? Has India really changed from a nation of bullock carts, or have its purveyors masterfully refashioned its perception on the global stage?

For years, Americans have seen India as a giant but inept state. That negative image is now obsolete. After a decade of drift and uncertainty, India is taking its expected place as one of the three major states of Asia. Its pluralist, secular democracy has allowed the rise of hitherto deprived castes and ethnic communities. Economic liberalization is gathering steam, with six percent annual growth and annual exports in excess of $30 billion. India also has a modest capacity to project military power. The country will soon have a two-carrier navy and it is developing a nuclear- armed missile capable of reaching all of Asia.

We have lived through a period of history when unprecedented changes have taken place. Since continuity is more easily understood, and favoured, by our elite than change, they have failed to grasp the enormity of the change we are now undergoing. Therefore, there is a lot of scepticism about unfamiliar developments and the benefits flowing from these for the country. For instance, there is not adequate appreciation of the end of the Cold War when two blocs of nations armed to the teeth, with enough nuclear weapons and missiles to destroy our civilisation several times over, in confrontation for 40 years finally concluded a peace treaty and agreed to cut back on their armaments. There is no precedent for this in history.