Is it worth to have a democracy?

Is it worth to have a democracy? Most governments in democracies do is to work on getting elected. World Famous investment guru Marc Faber says India would do much better without any government.


Investment guru Marc Faber :

It would do much better if there were no government. In most democracies the government has outgrown its usefulness. It does not do what is good for the country but what is good for getting elected again. This is endemic in all democracies. But in some countries the size of the government has reduced while in others it has not. India probably belongs to the second category. The government should stay out of the market economy. The only industries that are doing well (in India) are the ones that can bypass the government, namely, software and generic drugs.

In India, the government has created a framework where the market economy can function less efficiently. In principle, infrastructure has to be handled by the private sector but the legal system is such that it is impossible for the private sector to do infrastructure projects. Singapore, Thainwan and South Korea, have done quite a good job in managing the market economy.

I do not think regulations are any good in India. There is a difference between good rules and regulations and bad rules and regulations. India has managed to have the worst rules and regulatons in the world. Nobody knows who is the owner of land in the countryside and nothing gets developed in Mumbai. For me, the market is the economy. I as an individual cannot buy shares in India. Why not? What is the rationale?

The worst place to get a visa in the world is probably an Indian consulate and embassy. You may say that India is changing for the better but in the Bible it is said that you will not be judged for the good that you have done but for the good that you could have done. On that score, the Indian government scores very low marks

The outsourcing process in the service industry is at its infancy now and India can really play a big role here. Lot of services in the West can be transferred to lower wage cost countries and to counties which have a large educated population. In a few years, all major research labs will be in India and China

The roads, ports have to be in place. I am not a great admirer of China. I like India because the cultural background is more appealing to me. But the Chinese are much more pragmatic in fostering economic growth than the Indians.

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Marc Faber should read up on the recent regulation changes that are alloing for greater project finance opportunities than ever. The entire Delhi subway syustem was made by a Korean firm. I think he might be reffering to the license raj of yore. It is no more.

He is bang on about convertibilty and FII flows. 2004 should be better for both those aspects.

he is a bit highlevel, but is fine. He is correct in that India makes it harder to do business. But it geting a lot easier. Re: comparison ot china, while th elegal system might be behind china..the banking and finance systems are better. Investing in China is more like playing the .Com game. You are waiting for future returns and showing assets on the balance sheet as markers for profitabilities.. the ROA is terrible in China..It is a waiting game to see whether China will an Amazon or a Webvan.