What aid does Indian economy need?
What aid does Indian economy need?
Introduction
The Indian economy needs to develop sound policies and generate enough funds for new start-ups. It needs infusion of investment from international as well as domestic sources. India also needs business-friendly policies so that it can attract and encourage leading entrepreneurs to start new companies and spur economic growth. Key reforms are needed in the manufacturing sector so that companies can grow and develop rapidly. More support is needed from subject matter experts to make a difference to the current functioning of companies in the corporate sector.
Viewpoint
• The world is on the cusp of a change. As the changing social and political milieu shape foreign policies, India has to make strategic bilateral trade partnerships to ensure that it grows and develops well. Isolating itself to a handful of nations or putting all the eggs in one basket is not going to yield benefits or dividends. At the same time, the markets need to be insulated from external economic turbulences to some extent so that the investors have the confidence to view it as stable.
• Our economy is lagging due to problems such as inflation and low growth rate. Rather than sticking to current tax slabs, those who are obscenely rich should be taxed much more than current rates. This is because India is suffering from inequitable economic growth. The poor are dying of hunger and starvation and the rich are travelling in private planes and earning more capital. This type of inequity is bound to be disastrous for the economy. Rather than pleasing the idle rich, the aim should be to request them to pay more and work for the benefit of the economy. Failure to do this will continue to create gaps between the rich and the poor. It will also prevent capital from flowing to the market.
• India is a country where people are cautious about spending. Investors should be encouraged to diversify their portfolio so that there is infusion of funds into the economy. This can encourage and boost consumerism and establish a healthy market for companies.
• Infrastructure is the need of the day. Companies should be encouraged to work together for the effective implementation of key infrastructure projects. The economy needs to expand and this will only be possible if businesses have access to world class infrastructure.
• The economy is also being bogged down by ineffective implementation of key projects and schemes. If new legislation for the interest of small scale industries is not initiated, big business houses will continue to garner key projects and capture a lion’s share of the profits. Small businesses also provide jobs and they are crucial for the economic growth and development of the country. They should be encouraged.
• Apart from business friendly policies, structural reforms are needed. A more viable development model needs to be adopted incorporating the present changes such as the state of the rupee and the trends regarding economic growth.
Conclusion
If the next government does not take efforts to boost investor confidence and spur economic growth, our country will continue to be plagued with unemployment, corruption and a potential economic melt-down. Progressive and dynamic leaders are needed for ensuring that the economy recovers and India takes steps towards becoming the superpower it is capable of being.
Discussion
- What aid does Indian economy need? -Farhana Afreen (04/03/14)
What aid does Indian economy need?
In recent news, Bill Gates was heard saying soon India shall not be in need of any kind of aid from foreign countries. Does that mean India has grown rigorously in the past few years in terms of economy? India is a yet a developing nation that has a lot of drawbacks in its system and society that needs reforms. Economically, India is not even at the verge of development. But to some extent I agree to what Mr. Gates had to say about the condition of the nations that receive aid from the leading nations.
There must be numerous instances when the aid provided for development must have been misused or not deployed at the required areas. By providing aid, they are only making the country lazy. For development, Indian economy needs trade and not aid. Any developing nation can flourish it has good trade in line. India must strive for better trade with the developed nations to improve its economy.
The economical growth in India needs to be inclusive moreover to ensure that it is prolonged and sustainable. Inequality on the grounds of gender, race, religion, caste and creed are still being practiced and that is one reason why development cannot cover the major half of the country. The greater half of the country is still unemployed, illiterate and poor. Malnutrition, educational aid and healthy life have to be made available to this half of the country to see an overall growth in the economy of the nation. Increasing prices of basic commodities in a country where 40% of the people do not get proper meal for the day is not going to make the nation grow.
Consumer prices in India have increased at an average annual speed of 10 per cent during the past five years, and Indian families are predicting another 13 per cent swell next year. To check price increases, the Reserve Bank of India has increased interest rates and will reassess India’s monetary policy framework in line with suggestions by the Urjit Patel Committee, which is likely to submit its statement by the end of the year. It is also necessary to administer synthetically induced national and international mechanisms. The central bank and Ministry of Finance are working mutually to evaluate and realize the causes and find ways to promote investment and curb inflation.
Indian cities are budding at an extraordinary speed—the country’s urban population is expected to grow to 590 million people by 2030. This hasty urbanisation is also likely to make economic growth: according to some estimates, cities could breed up to 70 per cent of new jobs created until 2030 and produce 70 per cent of Indian GDP. To harvest the economic advantages of urbanisation, the Indian government must develop better policies to meet urban infrastructure needs through sustainable means and address growing urban poverty and inequality.
The obvious role of states in bringing about economic growth, governance and policies has increased. States are motivating restricted augmentation, enhancing their own reserves, and budding models that are being simulated across the country. But the centre needs to do more to aid state-state communication and the states should also be practical in giving of knowledge of best practices among themselves. The government should also look for more opportunities to balance the uneven growth between states.
Despite various political standoffs this year, the governments of both India and China are enthusiastic to boost mutual trade to US$100 billion in the next few years. No doubt, trade with China is a considerable component of India’s economy. But trade relations hang about one-way, with more Indian consumers buying Chinese goods than the other way around. India will have to speak to this trade shortfall in the next year to come by recuperating its export profits and trading more goods and services to boost balanced trade with China.
