...Long Run Prospects for GDP Growth in India Ombir Singh Ombir Singh, School of Management, Gautam Buddha University, Greater Noida Gautam Budh Nagar, U.P. PIN-201308, India Tel: -91-120-2344324 E-mail: odahiya@gmail.com Manju Dahiya Manju Dahiya, Research Associate, Institute of Development Studies, M.D. University Rohtak (124001), Haryana, India E-mail: manju11jan@gmail.com Abstract Due to global financial crisis, issues relating to the growth of Indian economy have been the subject matter of debate and discussion at home as well as abroad. Global financial crisis affeced the growth rate of every sector of the economy but not as much as high, slogans annonced by the corporate sector. The Indian economy has been achieving the high rate of growth after the reform process. In India, where rapid economic growth has become a national goal, analysis of the sources of growth assumes special significance to formulation of the macroeconomic strategy and policies that affect the future growth rate- as well as pattern. This study explains “How has the Indian economy growing after independence. Using the latest data on labour and a model of capital accumulation and productivity growth, we map out GDP growth on India economy until 2050. It estimates potential growth using the Cobb-Douglus production function in the Indian context and then examine their implication for policy. 1. Introduction During the last couple of years, issues relating to the growth of Indian economy have been the...
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...represent a huge market for national and international companies. However India is still facing some difficulties that are slowing it expansion and its economic growth. Trying to solve them is the main objective of the minister of finance Jaswant Singh that has to craft a budget to achieve the 10th five years plan, which constitutes an economic, and social growth project for 2002-2007. Among its main objectives is achieving, a growth rate of 8% (Exhibit 2), removing interstate barriers to trade and commerce, implementing a more efficient fiscal management, creating jobs, reducing poverty, illiteracy and solving the social, politic and religious conflicts within the country. What were the reforms that led to this new plan? Is this developing India attractive for foreign direct investment? To answer to this question, we will start by analyzing India’s Background and we will finish by studying its process towards globalization I. India’s Background India’s population in 2002 knew a continuous growth of 1,5% and is estimated to keep and on growing. Live expectancy had reached 62 in 2002 and the literacy rate was 65% in 2001. Having a very diversified population, the country has 18 official languages, Hindu being the most prevalent. Many religion try to cohabite, not always successfully, inside the territory. Hindu-Muslim frictions represent a major problem for the country; indeed, they have been taking thousands of lives during many violent episodes between the two religions...
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...SOCIALISM OF SOCIETY IN INDIAN ECONOMY INTRODUCTION Impact of Dr. B.R.Ambedkar's thoughts on Indian economy is evaluated under the following main heads: * Reforms on agricultural lands. * Currency problem. * Financial problem in public. * Taxation policy. * Industrial growth on national level. * Economic development. * Socialism of state. * Miscellaneous economic Problems. I. Economy enterprises. II. Over population III. Upliftment of women for economic development. IV. Human capital. V. Hindu economy. (1) Reforms on agricultural land:- After long study on Indian agriculture Ambedkar recognised that problems of agriculture related to farmers should be solved, in one of his article i.e. "Small Holdings in Indian and their remedies"(1917) and also in "Status and minorities"(1947) he has suggested some reforms which has included in the manifesto of the "Swatantra Majdur Paksha"and the Scheduled caste Federation. Ambedkar recognized that small subdivided and fragmented holdings of land are the major problem of Indian agriculture with affects. It has resulted in various disadvantages, and there were difficulties in cultivation and utilization of resources increasing cost, low productivity, inadequate income, Low standard of living etc. According to Dr. Ambedkar reforms on agriculture is not related only with the size of holdings but also with other factors such as capital, labour and other inputs, so the concept of "Idea of Economic...
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...of the leaders of the time. 2) How is the economy structured? Does it allow for legal robbery (Nock's phrasing)? The biggest criticism of India’s economy apart from widespread corruption has been that it failed to expand and make use of foreign investments. Instead it worked on expanding local industries requiring strict licensing from the government which in turn gave rise to corruption and inefficiency. In 1991, India developed into an open market economy and put into place many practices such as industrial deregulation and privatization of state-enterprises. It also reduced controls on foreign trade and investments and continued to grow at an accelerated rate. With 1.2 billion people, India now has the world’s fourth largest economy. However, the last two years have seen a two decade record low in the growth rate with decrease in foreign investments due to widespread corruption scandals, increased...
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...by 2002 making it one of the fastest growing economies of the world. India removed almost all its import and capacity licensing restrictions and adopted the Washington Consensus. Financial controls were enforced by the International Monetary Fund (IMF), thus making major economic reforms in India that would grant them loans in order to move it along toward a more market-oriented economy. The focus of these reforms was to reduce the governments’ bureaucracy and stabilize the country’s macroeconomic balance. Competition barriers became less burdensome, inflation was lowered, and the current account was balanced. Even though these issues illustrate a road to improvement, huge fiscal deficits still existed and interruptions and corruption in Pakistan continued. Foreign investment became slow to enter India due to the continued restrictions on foreign ownership, the slow progress of privatization, and India’s substandard infrastructure. To achieve growth in India, significant reforms needed to be passed. Success in India’s growth performance plan for economic and social growth into reality would be the country’s’ biggest obstacle. 1. Why did India experience relatively slow economic growth from independence until 1991? India’s population had reached 1.05 billion by 2002 and was growing at 1.5%, more than the country could support at the time. Domestic issues existed between numerous religions. India’s government adopted an Import Substitution Industrialization model...
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...Political and Legal Environment Independence: 15th August 1947 (British colonial rule) System: Federal Parliamentary Democratic Republic Legislature: Bicameral legislature (upper house- states of India; lower house- people of India) May 2014 Election: Bharatiya Janata Party claimed majority, brought back single party rule. Trade Agreements: India-Sri Lanka Free Trade Agreement, India-Nepal Trade Treaty, CECA, ASEAN Political and Legal Environment Independence: 15th August 1947 (British colonial rule) System: Federal Parliamentary Democratic Republic Legislature: Bicameral legislature (upper house- states of India; lower house- people of India) May 2014 Election: Bharatiya Janata Party claimed majority, brought back single party rule. Trade Agreements: India-Sri Lanka Free Trade Agreement, India-Nepal Trade Treaty, CECA, ASEAN Future Political and Economic Agenda * Improving foreign investment climate * Developing a comprehensive WTO strategy * Reforming agriculture, food processing, and small-scale industry * Eliminating red tape (excessive regulation or rigid conformity to formal rules) * Instituting better corporate governance * Accommodating an additional 10 million urban dwellers each year is a strategic policy issue. Future Political and Economic Agenda * Improving foreign investment climate * Developing a comprehensive WTO strategy * Reforming agriculture, food processing, and small-scale industry * Eliminating...
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...The problem with urbanization arose when the definition of urban center could not be standardized in the first Census which was conducted after gaining independence and also because of massive rural-urban migration which occurred due to partition of the country. The highest level was noted during 1970 (3.8%). It increased to 286.1 million comprising 27.8 % of the total population in 2001. The average annual growth rate of the urban population was 2.37 % in 2001. There was a slight decrease in the period of 2005-2010, and annual growth rate was 2.31%. However, with the beginning of 2011, the situation changed to 2.76%. It is predicted that this number will only increase. Industrialization started with the help of first Prime Minister. It was a key to alleviating poverty. Thus, India gave priority to heavy industry and neglected agriculture. The government was allowed to regulate all basic business decisions. Beginning of 1980 brought mild trends of deregulation together with economic reforms and liberation of trade and financial policies. In 1991, there was adopted a major reform program. The government promoted competitive economy and foreign investments. Global integration was encouraged with a significant reduction in the usage of important tariffs and licenses. In 1993, trade was completely free. An average import tariff of 71% was reduced to 40%. Kolkata is the capital of the Indian state of West Bengal and a former capital of British India. It is one of the biggest cities and...
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...Sustained growth in India since the 90s According to the neo-classical theory, growth is only sustainable if it is driven by technological progress or productivity growth. Innovation and incentives to innovate are therefore essential. In order to increase incentives, some institutions and/or policies should be put in place. Firstly, well established property rights create incentives for innovation through increased returns mainly because investors can keep a bigger portion of the profit they make. Secondly, an effective education system increases efficiency of technologies and investment and reduces cost of skilled labour which in turn increases return of innovation. Thirdly, macroeconomic stability and consequent low interest rates encourage entrepreneurial behaviour. Another important factor is the access to credit and a sound financial market, which makes it easier to borrow money for projects. Lastly, higher competition among incumbent firms and higher entry threat will encourage innovations by incumbent firms close to the technological frontier. In what follows, we try to provide an answer to why the "take-off growth" in the 80s is not considered as sustainable and what the factors of the sustained growth in the 90s m Although the liberalization reforms in the 80s contributed to a long-run productivity growth, it is argued that the accelerating growth of the 80s was not sustainable, mainly because the government boosted demand through domestic expenditures (Panagariya,...
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...In case of our Five Year plans, the long-term objectives are: (i) A high rate of growth with a view to improvement in standard of living. (ii) Economic self-reliance; (iii) Social justice and (iv) Modernization of the economy (v) Economic stability (i) High Rate of Growth All the Indian Five Year Plans have given primary importance to higher growth of real national income. During the British rule, Indian economy was stagnant and the people were living in a state of abject poverty. The Britishers exploited the economy both through foreign trade and colonial administration. While the European industries flourished, the Indian economy was caught in a vicious circle of poverty. The pervasive poverty and misery were the most important problem that has to be tackled through Five Year Plan. During the first three decades of planning, the rate of economic growth was not so encouraging in our economy Till 1980, the average annual growth rate of Gross Domestic Product was 3.73 percent against the average annual growth rate of population at 2.5 percent. Hence the per-capita income grew only around 1 percent. But from the 6th plan onwards, there has been considerable change in the Indian economy. In the Sixth, Seventh and Eight plan the growth rate was 5.4 percent, 5.8 percent and 6.8 percent respectively. The Ninth Plan, started in 1997 targeted a growth rate of 6.5 percent per annum and the actual growth rate was 6.8 percent in 1998 - 99 and 6.4 percent in...
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...India, 2011). The large number of people in the city has created numerous challenges in the Asian country. Demography of Mumbai The city boasts of a diverse mix of cultures and religions due to the influx of people looking for opportunities. Hindu still remains the predominant religion, with most cultural practices and lifestyle associated with Hinduism. Over 60% of the city’s population ascribe to Hindu as a religion and culture (Census of India, 2011). The rest is a mix of Muslims, Christians, Buddhists, and, to a lesser extent, Jain, Jewish and Sikh religions. This religious and cultural mix gives the city a rich and diverse mix of culture, despite the predominance of Hindu. According to the Indian census carried out in 2011, Mumbai features a sex ratio of 922 (Census of India, 2011). This suggests that the number of women is almost equal to the number of men in the city. This might be attributed to the fact that most working men move in with their families into the city while looking for opportunities. This phenomenon continues to increase the population and health burden on the Indian mega city. Despite its challenges, which will be discussed later in this paper, the city of Mumbai still finds itself with a modest literacy rate at 67% (Census of India, 2011)....
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...Q3: Assess the general direction of the political and economic policies being followed in order to develop the country. Rapid growth since 1980 has transformed India from the world’s 50th ranked economy in nominal U.S. dollars to the 10th largest in 2005. When income is measured with regard to purchasing power parity, the Indian economy occupies fourth place, after the United States, Japan, and China. Along with growing incomes, India’s increasingly outward orientation makes it an important player in the global economy and the growing optimism about India’s economy has led to a surge in international investors’ interest. Further growth acceleration since 2003 has shifted the debate from a concern about the ability to sustain an annual growth rate of 6 percent to the prospects for increasing this growth rate to 8 percent (Ahmed 2007, Commission on growth and development, Battles Half Won: The Political Economy of India’s Growth and Economic Policy since Independence). The down turn in the economy that appears to have begun in the USA in September, 2008 has had some negative impact on the Indian economy. The most immediate effect of this global financial crisis on India is an out flow of foreign institutional investment (FII) from the equity market. This withdrawal by the FIIs led to a steep depreciation of the rupee. The banking and non-banking financial institutions have been suffering losses. The recession that generated the financial crisis in USA and other developed economies...
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...Impact of Economic Globalization on India Sabrina Mallavarapu University of Maryland, College Park Impact of Economic Globalization on India Many people fail to realize that it was only 69 years ago that India gained independence from British rule. India is generally thought of as very poor country but it is because it is still a new country. India has undergone major socio-economic changes since its independence from Great Britain. While India did not fair well under Great Britain’s rule, India benefitted from Britain in terms of creating an infrastructure and industry that is still in use today. While India still has many problems, India has benefitted from economic globalization because it has resulted in major economic growth that led to it having the fastest growing GDP of any nation. With the power of the East India Trading Company, the British already had control of several ports, as the company had been a major presence in India since the 1600s, even with the Mughal Empire ruling India. The British had immense power in India’s economy, creating settlements known as Madras, Bombay, and Calcutta, which are now major modern cities in India. Britain’s military power led to its ability to have a monopoly on trade, but also later establish their rule in India. In the early 1700s, South Asia saw the decline of the Mughal Empire as it weakened from repeated wars, rebellions, and invasions (Embree, 2006). India was fighting the remnants of the Mughal Empire when the...
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...rP os t 9 -7 1 2 -0 3 8 REV: MARCH 12, 2014 LAKSHMI IYER RICHARD H. K. VIETOR India 2014: The Challenges of Governance op yo Introduction In January 2014, India’s government faced significant economic and social challenges. Economic growth rates had slowed from 10.5% in 2010 to only 4.9% in 2013. Inflation remained stubbornly high at 10.1%, despite sustained interest rates of around 10%, and the rupee/dollar exchange rate depreciated from 45 rupees in March 2011 to 62 rupees in December 2013. tC The ruling Congress Party faced worsening political obstacles as well. After the 2009 elections, the government had found it very difficult to enact substantive new legislation, owing to gridlock caused by opposition political parties and the Congress Party’s own coalition partners. A decision to allow foreign investment in retail megastores had been put on hold following objections by the Trinamool Congress, a key political ally.1 In September 2012, legislation was passed to allow foreign investment in multi-brand retail stores in states which agreed to implement the decision. 2 After making more than 100 amendments to satisfy diverse stakeholders, a new Land Act was passed in August 2013 to enable the state to acquire land for industrial growth more efficiently, with increased compensation for landowners.3 No Over the past few years, a series of high-profile corruption scandals had resulted in the resignation of several cabinet ministers and state chief ministers. These scandals...
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...NEWSLETTER 12 Pages Join us on Facebook… … a weekly news bulletin www.xedintellect.com 20th Sep 2012 – 26th Sep 2012 IN BRIEF COVER STORY REFORMS AT LAST !!! ECONOMIC INDICATORS Brent Crude $110/barrel BSE 18,694.41 points (as on Tuesday, September 25) PERSONALITIES OF THE WEEK Christine Lagarde Sachin Bansal CORPORATE INTELLIGENCE BIG THREE MANAGEMENT CONSULTANCIES NEWS DIGEST… BUSINESS NEWS GLOBAL NEWS MISCELLANEOUS NEWS Wal-Mart plans to open its first outlet in India within 12-18 months More than two-thirds in USA live pay check to pay check Foxconn unit in China closes after workers clash ECONOMIC INDICATORS 2 COVER STORY 3 PERSONALITIES OF THE WEEK 4 CORPORATE INTELLIGENCE 5 NEWS ANALYSIS 6 JOB PROFILE 11 PART TWO KNOW YOUR BASICS: DATA ANALYTICS KNOW YOUR BASICS: DATA ANALYTICS D ata analytics (DA) refers to examination of raw data for drawing meaningful conclusions usually with the help of the latest IT tools. DA is categorised into exploratory data analysis (EDA) and confirmatory data analysis (CDA). EDA refers to finding new features in the data (similar to data mining) while CDA is used to examine the validity of existing hypotheses. There‟s another category known as Qualitative data analysis (QDA) which is generally used in the social sciences to draw conclusions from non-numerical data like words, photographs or video. The term "analytics" has been used by many business intelligence (BI) software firms...
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...Bangladesh has a subtropical monsoon climate characterized by wide seasonal variations in rainfall, moderately warm temperatures, and high humidity. Regional climatic differences in this flat country are minor. Three seasons are generally recognized: a hot, humid summer from March to June; a cool, rainy monsoon season from June to October; and a cool, dry winter from October to March. In general, maximum summer temperatures range between 32°C and 38°C. April is the warmest month in most parts of the country. January is the coldest month, when the average temperature for most of the country is 10°C. Winds are mostly from the north and northwest in the winter, blowing gently at one to three kilometers per hour in northern and central areas and three to six kilometers per hour near the coast. From March to May, violent thunderstorms, called northwesters by local English speakers, produce winds of up to sixty kilometers per hour. During the intense storms of the early summer and late monsoon season, southerly winds of more than 160 kilometers per hour cause waves to crest as high as 6 meters in the Bay of Bengal, which brings disastrous flooding to coastal areas. Heavy rainfall is characteristic of Bangladesh. With the exception of the relatively dry western region of Rajshahi, where the annual rainfall is about 160 centimeters, most parts of the country receive at least 200 centimeters of rainfall per year (see fig. 1). Because of its location just south of the foothills of the...
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