Really bad governance. All the development and growth you hear about is driven by capitalism, private sector growth, and privatization of energy, telecommunication and other traditional government strongholds.

The country is held back by public sector mismanagement and obscene corruption.

Not sure if relevant, but the Geopolitics of the United States article claims the thesis that one reason the US got such a strong economy was because the rich Mississippi Basin had more navigable waterways than the rest of the world combined. It mentions the Ganges River by saying:

"The Ganges River Basin is the most agriculturally productive in the world, but the Ganges is not navigable. The combination of fertile lands and non-navigable waterways makes the region crushingly overpopulated and poor."

Its really a mixed bag. Some regions have phenomenal growth and are driving all the growth. Where as the poorer regions of the country are left in a vicious circle. Although that is changing but at a very slow rate.