SINGAPORE – In August, Raghuram Rajan was appointed Governor of the Reserve Bank of India. On one level, this was a routine announcement that many had anticipated – after all, Rajan is arguably the best-known Indian economist of his generation. On another level, however, his appointment can be seen as part of a broader generational shift. Rajan, just 50, will be the first RBI governor born after India became a republic in 1950.

Similar changes are taking place in all walks of Indian life, including politics, the arts, sports, and social development. And India will be better for it. Although the country is one of the youngest in the world, with an average age of just 26 years, until recently aging stalwarts incongruously dominated most fields, from politics to the arts and even business and sports.

But now younger entrants are rising everywhere, bringing with them energy and new ideas. In politics, as the country prepares for next year’s general election, the leading contenders to replace 81-year-old Prime Minister Manmohan Singh are the Bharatiya Janata Party’s Narendra Modi, 62, and Rahul Gandhi, who is just 43. Either man would be the first prime minister who was not born in the British Raj.

The arts were one of the first areas to witness this generational change. For a long time, Indian literature, especially in English, was dominated by a clique who wrote mainly for a niche audience and literary recognition. Then, a few years ago, a group of young writers – such as Chetan Bhagat and Amish Tripathi, both former bankers – changed the rules of the game by writing for the mass market.

Rather than write for literary critics, they began to use a simpler language, including Indian turns of phrase. They also chose new themes: Tripathi dipped into ancient mythology to write a trilogy about the god Shiva, while Bhagat began to write about the lives of India’s young, upwardly mobile middle class.

Predictably, the purists pounced and the critics ridiculed. But people have bought their books in the millions, and film deals have followed. As a result, the market for books has dramatically expanded and publishers have been forced to change their entire business strategies.

Something similar has happened in the music industry. Previously dominated by a small cabal of singers and music directors, the market has been transformed by TV talent contests, similar to American Idol, which provide a national showcase for the wealth of India’s talent.

The shows have made participants, some drawn from remote towns, into overnight stars, and many of them have gone on to sign lucrative careers. Thanks partly to this parade of new talent, the Indian music industry is experiencing a period of extraordinary innovation and expansion. The output of the US and European music industries sounds stale in comparison, owing to a dearth of innovation over the last two decades.

Generational change has even come to India’s most popular sport – cricket. Such was the adulation once heaped upon its aging stars that many of them remained on the national team long past their peak. But a mere two years after winning the World Cup in 2011, several members of that victorious team have been replaced – a decision that until recently would have seemed unthinkable.

India’s social sector has also been transformed. Development policy used to be dominated by career activists wedded to socialist-era thinking. But the arrival of new faces from the world of business, such as Ashish Dhawan, Jayant Sinha, and Ramesh and Swati Ramanathan, has meant that development issues are at last being assessed according to the problem-solving approach of social entrepreneurs, rather than through the ideological lens of activists.

Ironically, it is the world of business that remains slow to change. The growth of the IT sector in the 1990’s seemed to promise that change would be rapid and far-reaching, but the old business families still dominate.

There is hope, though. Entrepreneurs like Manish Sabharwal of Teamlease, and Binny and Sachin Bansal of Flipkart, an online retailer, are fundamentally changing the way India does business. Similarly, Indian academia may be moribund, but new public intellectuals like Pratap Bhanu Mehta have emerged from outside the mainstream.

Yes, India’s economy has slowed sharply, the rupee has plunged, and scandals and protests dominate the headlines. But, behind the gloom, a new generation is taking over, bringing with it fresh ideas and visions for India.