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Understanding Indian Economy

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Understanding Indian Economy. By:-Sandhir Sharma. Economic Development ... Demographic Peculiarities. Unemployment and Underemployment. Technological Backwardness ... – PowerPoint PPT presentation

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Title: Understanding Indian Economy


1
Understanding Indian Economy
  • By-Sandhir Sharma

2
Economic Development
  • Approach to Economic Development
  • Gradual Approach
  • Big Push Approach
  • Factors in Economic Development
  • Natural Resources
  • Capital Formation
  • Technological Progress
  • Knowledge
  • Infrastructure
  • Population and Human Resource
  • Investment Conditions
  • Political and Social Factors

3
Indian Economy an overview
  • India as Mixed Economy
  • Instruments of Mixed Economy
  • Industrial Policy Resolution
  • Industrial Licensing
  • Nationalisation
  • Promotion of Private Sector
  • Subsidies SAPs
  • Shortcomings of Mixed Economy

4
Features of Indian Economy
  • Mass Poverty and Low Per Capita Income
  • Inequalities in income distribution
  • Inadequate Capital Formation
  • Predominance of Agriculture
  • Demographic Peculiarities
  • Unemployment and Underemployment
  • Technological Backwardness
  • Infrastructural Inadequacies
  • Dualistic Economy
  • Unfavourable social and value structure

5
India as progressive nation
  • Sustained Growth
  • Self reliance and minimal dependence
  • Agriculture Transformation
  • Industrial Changes
  • Infrastructural revolution
  • Changes in Foreign Trade
  • Strong Fundamentals
  • Expansion of Education
  • Reduction in Poverty
  • More Employment

6
Economic Planning of India
  • Growth of Idea of Planning in India
  • Bombay Plan
  • Gandhian Plan
  • Sarvodya Plan
  • Planning Commission and Five Year Plans
  • Currently 11th five year plan (2007-2012) going on

7
Economic Planning - Features
  • Democratic
  • Different Sectors
  • Existence of Central Plan and State Plan
  • Financial Planning
  • Unchanging Priorities
  • Prospective and Perspective Planning
  • Central Planning Authority
  • Set Objectives
  • Government Control
  • Complete Development
  • Definite Time
  • Slogans

8
National Income (2007-08)
  • GDP growth rate approx. 9 per annum
  • 8.7 increase in National Income
  • 7.2 increase in per capital income
  • Agriculture growth in 2.6
  • Industry growth is 9.4
  • Services Sector growth is 10.7

9
Main Features of National Income
  • Dependence on Agriculture
  • Poor Growth rate of Per Capita Income
  • Unequal Distribution
  • More expenditure on Food
  • Low standard of Living
  • Low growth rate of National Income
  • Unequal growth rate of different sectors
  • Income levels in Urban and Rural areas
  • Regional Disparity
  • More income on private sector
  • Increasing share of organized sector
  • Increasing significance of Territary sector.

10
Cause of Low National Income of India
  • Low rate of saving and investment
  • Backward technology
  • Rapid increase in population
  • More dependence on agriculture
  • Inadequate industrial development
  • Unbalanced growth of different regions
  • Fatalism
  • Illiteracy
  • Political factors

11
Regional Imbalances
  • Goa, Haryana, Maharashtra, Punjab and Gujarat
    having max. per capita income in India
  • Bihar, UP, MP, Orissa and Jharkhand having min.
    per capital income in India

12
Causes of Inter regional variations
  • Difference in agricultural productivity
  • share in total foodgrain production
  • Difference in Net Irrigated Area
  • Difference in Industrial Development
  • of People below poverty line
  • Growth rate of Population

13
Infrastructure of India
  • Two types
  • Economic / Physical Infrastructure
  • Transport
  • Energy
  • Communication
  • Irrigation
  • Science Technology
  • Social Infrastructure
  • Health
  • Education

14
Infrastructure a challenge
  • Low priority in Plans
  • Huge requirement of Investment
  • Long Gestation Period
  • Exclusion of Private Sector
  • Regional Imbalances
  • Poor Maintenance
  • Less Expenditure on RD

15
Infrastructure Development Plans in 11th Five
Year Plan
  • Highways 40000 Kms to be developed by 2012
  • Airports - likely investment by 2012 is Rs.
    40,000 crore
  • Railways - likely investment by 2012 is Rs.
    22,000 crore
  • Power generation 60 to 70 thousand MW with an
    investment of Rs. 5,00,000 crore
  • 1.5 Lakh villages to be electrified

16
Infrastructure Development Plans in 11th Five
Year Plan
  • Six lanning of roads upto 6500 Kms
  • Construction of 7 Green field Airpots
  • Telecommunication subscriber base to be increased
    to 600 million
  • Construction of new rural roads upto 1,65,244 kms
  • Rs. 11,02,327 crore has been porposed for social
    services

17
Agriculture in India
  • India has been ranked no. 1for
  • Total irrigated area
  • Pulses
  • Jute
  • Spices
  • Milk
  • Butter and ghee
  • Cashew nuts

18
Agriculture in India
  • India has been ranked no. 2 for
  • Cultivable land
  • Wheat
  • Rice
  • Sugar
  • Fruits Vegetables
  • Tobacco
  • Tea

19
Agriculture Growth
  • 10th Plan noticed 2.5 growth rate
  • Per labourer productivity is only 391 US
  • Egypt productivity of rice is more than thrice in
    India
  • Wheat productivity in UK is about three times
    more than India
  • Per hectare output of cotton in China is about
    three times in comparison to India

20
Causes of Backwardness of Agriculture
  • Human Factors
  • Pressure of Population on Land
  • Social Atmosphere
  • Institutional Factors
  • Small Size of farms
  • Land Tenure System

21
Causes of Backwardness of Agriculture
  • Technical Factors
  • Inadequate Irrigation Facilities
  • Old Agricultural Implements
  • Old Methods of Cultivation
  • Inadequate High Yielding Variety Seeds
  • Shortage to Manures
  • Defective Marketing
  • Diseases of the crops and Pests
  • Weak Cattle
  • Defects of Soil
  • Lack of Credit Facilities

22
11th five year plan for agriculture
  • Second Green Revolution
  • Growth rate to increase by 4
  • Focus on agricultural research
  • Increase in irrigation faciltiies
  • Development of modern agricultural markets
  • Completing unfinished agenda of land reforms
  • Improving dry land farming practices
  • Promoting agro-based industries and agro exports
  • Utilization of waste and underutilized land

23
Industrial Growth of India
  • Industrial growth noticed at 8.6 approx in
    2007-2008.
  • Target to achieve 10 growth rate.
  • Turnaround in 1991
  • Liberalization
  • Privatization
  • Globalization

24
Weaknesses
  • Irregular Increase in Industrial Production
  • Underutilization of Installed Production
    Capacities
  • Increase in Monopoly Powers
  • Capital Investment in Low Priority Industries
  • Poor Performance of Public Sector
  • Increase in Regional Imbalances
  • Less Development of Small Industries
  • Industrial Sickness
  • Poor Quality Production
  • Industrial disputes

25
Major Growth Tools of Indian Economy
  • Industrial Policy 1991
  • Green Revolution
  • Land Reforms
  • Five Year Plans (currently 11th plan 2007-2012)
    going on

26
Major Problems of Indian Economy
  • Problem of Poverty
  • Problem of Population
  • Problem of Unemployment
  • Regional Imbalances
  • Inequalities of Income and Wealth in India
  • Foreign Trade Balance of Payments

27
Current Challenge for India
  • Global Crisis
  • Inflation
  • Corruption
  • Political Environment
  • Neighbour countries of India
  • Terrorism

28
Thanks
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