KEY POINTS:
The trick in trying to know India is not to try. J.K. Galbraith, former US ambassador to India, understood this when he called the country a "functioning anarchy".
But that was before Indian software professionals stormed America's Silicon Valley. Now, India's information technology industry has put it among the top players in the global economy.
According to analysts at Goldman Sachs, within a decade India can overtake Italy, France and the UK to become the world's fifth largest economy, if current economic growth rates continue.
By 2050, India's economy could be larger than that of the United States, the bank predicts.
"In 30 years, India's workforce will be more than the workforce of America and China combined," says Jim O' Neil, a member of the bank's global economic team. "The real battle is not between China and America, but between India and China."
These projections come on the back of a record 9.2 per cent current growth rate, driven by robust manufacturing and services sectors backed by high investment, strong consumption and export demand.
So, 60 years after independence, India looks set to take its place as a major world power.
It commands new respect on the world stage. Its nuclear status has been endorsed by the United States. Russia is keen to renew its friendship. Other emerging economies look to its leadership at world trade negotiations, and it expects to wrest a permanent seat on the Security Council once the UN is revamped.
This is the India that holds the world spellbound with its hi-tech acumen, glitzy high-rise towers and mushrooming shopping malls.
But there is another India, removed from the glitter and bursting entrepreneurial energy - the India stereotyped by the West in television footage of poverty and disease.
The two Indias are not moving in one direction.
At least, that's what the statistics show: 300 million Indians live on less than US$1 a day. Forty-five per cent of Indian children under the age of 5 are malnourished. More than half of its 500,000 villages lack electricity, drinking water and proper sanitation. Sixty five per cent of Indians don't have a bank account.
Despite India's booming economy, the gap between rich and poor is wide. Though there has been a decline in poverty overall, it is falling at the rate of 1 per cent, compared with the recent average of 8 per cent economic growth. The 7 per cent shortfall is threatening to produce a social backlash, particularly in the rural areas where more than 65 per cent of Indians live.
Population growth is adding to the problem. It grew from 357 million in 1950 to the current 1.1 billion. By 2050 India's population is projected to top two billion, putting it ahead of China as the world's most populous country.
A new population policy encourages the poorest couples to limit themselves to two children. China is urging its couples to have just one child.
But the Congress-led coalition Government must tread carefully. Indians still remember the forced sterilisation drive of the 1970s, initiated by the son of then Prime Minister Indira Gandhi.
The epicentre of the population explosion is rural India. It is also where the social backlash to globalisation is gathering steam.
Unable to compete in a globalised market, farmers are committing suicide. The opening up of the economy, which began in the 1990s, brought largesse to the cities. But the rural economy slowly dried up.
Things came to a head when the Indian Government tore a page from China's book of growth. It set out to develop tax-free trade zones across the country.
Special Economic Zones, originally conceived by China two decades ago, were designed to attract foreign investment by appropriating vast tracts of arable farmland and turning them into industrial estates.
The idea was to wean the rural workforce away from seasonal agriculture and into the manufacturing sector, to boost exports.
It worked in China. But the Indian Government's bid to emulate China hit a brick wall. Farmers protested en masse against what they saw as a Government initiative to grab their land and turn it over to the corporates.
The federal initiative was put on hold after protesting farmers were shot dead by riot police in the Socialist-ruled eastern state of West Bengal earlier this year.
Federal Commerce Minister Kamal Nath was disappointed. "If foreign direct investment is coming to our special economic zones," he warned, "it can also jolly well go to Thailand, the Philippines and Indonesia."
Rural unrest and impoverished farmers have fuelled the growth of a Maoist insurgency across a quarter of the country. Prime Minister Manmohan Singh has identified it as the single biggest threat to India's internal security.
But in the cities, consumerism is the new mantra of the Indian middle class. New cars choke the streets. Foreign brands compete for the growing disposable income that is making urban India the world's fastest growing domestic market.
This is where the big growth story is playing out. Indian shoppers flock to newly-opened malls flaunting Europe's best brands in clothes and cars.
The multinationals are cashing in, drawn by low overheads and a huge, English-speaking workforce.
The success of the hi-tech industries has led to a "brain gain", as overseas Indians return in large numbers to play their part in the economy.
The endemic problems are still there. Foreign investors are daunted by bureaucratic red tape, poor infrastructure, complex tax laws and corruption. The World Bank rates India as one of the most difficult places in the world to open a business. But once in, the pickings are rich for investors.
However, the new consumer revolution taking place could have a destabilising effect. Says Edward Luce, author of In Spite of the Gods: the Strange Rise of Modern India: "The economy is growing principally through the consumption of its middle classes. This is one of the locomotives of growth." Luce believes this celebration of consumption could result in a severe social backlash.
There are indications that this may already be happening. While economic growth is driven by the middle class, political change is driven by the underclass. This was borne out in the last general election when the governing Bharatiya Janata Party (BJP), which presided over an era of unprecedented economic growth, was voted out.
The lesson for the political establishment was clear: the urban middle class does not own the critical vote.
Political power is located in the great Indian outback, among the millions moving below the radar of globalisation.
Verdict 2004 was an unexpected gift for the Congress and its allies. Determined not to squander it, the new Government decided to keep the economics but change the politics.
The Federal Government decided to implement a controversial affirmative action plan - reserving places in government and in education for low-caste Indians - that uncorked bottled-up caste tensions that divided the country. A deep-rooted social issue burst into the forefront.
The move sparked nationwide protests by students and doctors. However, the Government won support from millions of low-caste Indians who form the bulk of the population.
Clearly, the challenge ahead for India is to keep caste tensions and rural unrest from derailing economic growth, and to spread the gains from the few to the many.
