It is widely believed that this year is likely to be a more difficult one than 2007 was, for both companies and governments.
And why not? Oil is close to $100 a barrel, financial turmoil continues in the rich world, inflation is rising and so are the risks of recession in the US. India and China are unlikely to be immune to these factors, though they will do better than most other economies.
But how serious are the problems? In a new report on global risks released in Geneva on Wednesday, the World Economic Forum makes a startling claim— 2008 will see the highest level of uncertainty in a decade. WEF mentions four risks in particular: those relating to the financial markets, food security, supply chain vulnerabilities and energy. What will be interesting to watch for is how the markets and governments share the burden of mitigating these risks in the months ahead.
Diehard optimists may say that India is a special case, but they may be surprised.