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India in Focus: “India’s Commonwealth Games: A National Disgrace”

From The Objective Standard, Vol. 5, No. 4.

Over the past few years, the Indian government spent $8.5 billion to host the Commonwealth Games (CWG), a multisport event akin to the Olympics, which were held in New Delhi from October 3 through 14, 2010.1 The official purpose of the CWG was to generate “national prestige” for India.2 But the Games did no such thing. In fact, the CWG were a national disgrace. The games showcased a contradiction embraced by Indians that threatens to destroy the economic and political progress they have achieved over the past two decades.

For more than four decades after India gained independence from England in 1947, India’s economy languished under the weight of the socialist policies stemming from the collectivist mind-set of the Indian people. As the economy faltered, India borrowed heavily from other countries and, especially, from the International Monetary Fund (IMF). In 1991, due to decades of low productivity and mounting debt, India faced a massive economic crisis: The Indian currency was destabilizing and the government could not pay its debts.

To receive extensions on the debt payments due, the Indian government reluctantly agreed to certain “deregulations” of its economy. In one such allowance, the government loosened restrictions on foreign investments, enabling foreigners to purchase up to 51 percent ownership in certain state-owned enterprises.3 This and similar pragmatic steps resulted in an influx of capital, stabilized the currency, satisfied lenders’ concerns about India’s ability to eventually pay its debts, and led the IMF to temporarily defer India’s loan payments.4 This process of “deregulation” came to be known as “the economic liberalization of India.”

Over the next two decades, as entrepreneurial forces were unleashed, India’s economy grew by orders of magnitude. Today, it is growing at a rate of 6 to 8 percent annually, making it the second fastest-growing economy in the world (after China).5 India’s Gross Domestic Product (GDP) now stands at $1.235 trillion, making it the eleventh largest economy in the world.6 The country has become a favorite destination for businesses seeking to outsource marketing, research, development, and other business processes. The net effect is that many Indians have become, and are becoming, very rich.

But the collectivist mind-set has not abated, and Indians are not content with wealth and prosperity. They want “national prestige.” Thus, Indian policy makers have embarked on a succession of projects to show off the country’s wealth. The CWG are the biggest, most ostentatious of these projects to date. To see the contradiction inherent in the Games, let us consider what made them possible. . . .

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1 “Commonwealth Games at What Cost?” News X Delhi broadcast, September 23, 2010, This is a conservative estimate based on the total amount spent on the games by all the governments in India—central, state, and local. See also

2 Syeda Sana Rahman, “The 2010 Commonwealth Games: Will India Pull It Off?” Institute of South Asian Studies article Brief No. 168, August 25, 2010,

3 Ajay Singh and Arjuna Ranawana, “Conflict of Interest: Local Industrialists Issue a Broadside against Multinationals,”, April 12, 1996,

4 Arvind Panagariya, “India’s Economic Reforms: What Has Been Accomplished? What Remains to Be Done?” Asian Development Bank policy brief, February 2002,

5 Anjana Pasricha, “India Now Second Fastest Growing Economy,” Australian News.Net, June 1, 2008,

6 International Monetary Fund, World Economic Outlook Database, April 2010,