Few gave it a chance, when, at a FICCI meeting in 1998, Prime Minister Vajpayee announced an ambitious Rs 56,000 crore (Rs 560 billion) highways plan, especially since the figure emerged from just multiplying the physical distance between points on the map by Rs 4 crore (Rs 40 million), the then thumb-rule cost of making highways.

Yet, with 2,400 km already 4-laned, and another 3,000 km to be ready by December, Vajpayee's Golden Quadrilateral program is the most successful the country's known.

• Mini-Budget 04-05
• India Shining!

Combine this with the rise in the country's teledensity from under 3 five years ago to 6 today (both major shifts in policy, once in 1999 and once now, have been made by Vajpayee), and the government's infrastructure success is obvious.

With Rs 22,000 crore (Rs 220 billion) of IPOs lined up over the next 12 months, forex reserves of over $103 billion, venture funds with $2 bn waiting to invest in the country, the steady moves towards capital account convertibility (when's the last time anyone could simply take out $25,000 from the country, no questions asked?), the freeing up of the aviation sector, even signing of free trade agreements with countries like Thailand, all are signs of an increasingly confident India.

Sure, GDP growth next year will fall to below 6 per cent once agriculture growth reverts to the trend 1-2 per cent, but some things are not going to change.

And those are India's emergence as a player in the knowledge business (it costs a fifth, or less, to develop a drug in India compared to the US), as a manufacturing hub for automobiles with the likes of Suzuki and Hyundai exporting cars out of here, as a research centre (from 183 patents at the US Patent Office in 1997, 1,700 patents were filed last year), and so on.

Indeed, Indian industry's never been more efficient -- a study by Tata Services found that, for the manufacturing sector as a whole, labour productivity rose by 8.5 per cent per year in the post-reforms period as compared to 6.5 in the pre-reforms era.

Indeed, if textiles and software exports grow as planned, from 4 per cent of GDP right now, their share will go up to 15 per cent by 2010. And, according to consulting firm Deloitte Research, additional offshoring of financial services will comprise 15 per cent of India's GDP by the end of the decade! In other words, the economy's undergoing a major structural change.

If India's arriving, what's one to make of the Congress party's talk of the 'fool-good' factor? Is is just a cute Jairam-ism, or something more?

Actually, there are serious issues, like very poor farm productivity, and the fiscal situation is a nightmare -- Vajpayee's deficits average around 5.6 per cent of GDP as against the United Front's 4.4, and debt stocks are up from 56 to 70 per cent of GDP. India's debt and deficits are worse than for countries like Mexico and Brazil that have had major financial meltdowns in the past.

With a fourth of Indians still illiterate, and a 50-80 per cent shortage in teachers for IIM/IIT kind of institutions, India's new found status as a knowledge economy could also take a hit sooner than we think. The shine's partly real, it's also part-Brasso.