After a long spell of high growth, the Indian economy is experiencing a downturn. The industrial growth is faltering, the current account deficit is widening, foreign exchange reserves are depleting and the rupee is depreciating. These features are directly related to the current global financial meltdown.
There is no question that the global financial crisis has crippled economic growth around the world. But the malaise, combined with the significantly reduced inflation—which has resulted partly from the downturn and partly from the fiscal and monetary measures taken by the Reserve Bank of India—has opened up a straightaway into which India can shift its cautionary policies, refuel its economic engine, and ultimately re-accelerate growth. It is therefore imperative that, while dealing with this meltdown, we must not lose sight of the core problems afflicting our economy, and must continue to take necessary steps to address them. India is now facing a major share of home grown problems—issues that have become
ever more glaring as India’s economy grows in size.
The series Studies in Indian Economy analyses many core issues and suggests suitable policy actions to achieve inclusive growth. Enhanced growth of the agricultural sector is vital for ensuring food security, poverty alleviation, price stability and sustainability of growth of the overall economy. The inadequate availability of modern infrastructure and shortage of skilled manpower are the most critical barriers to the growth of the manufacturing sector. The tasks of improving the institutions of economic governance comprise, among others, many policies and actions essential for efficient functioning of markets. It is recognized that good governance can be brought about only when the public sector functions fairly and efficiently, which is achievable by removing bottlenecks like bureaucratism, favouratism and corruption. The business community has a vital stake in improving and empowering public institutions.
Poverty continues to be a major problem throughout the world. Women and children suffer more from the clutches of poverty. Due to liberalization, the disparity between the rich and the poor is increasing at an alarming rate. The formal bank’s outreach to the poor is limited. In India, the poor continue to be marginalized from the socio-economic mainstream due to their lack of access to education, health, nutrition, employment, training, technology, market and credit. Poverty is a multi-sectoral problem and does not fit into any one of the sectors alone. Hence, an integrated approach is the need of the hour rather than the sectoral approach in addressing the problem of persistent poverty.
The articles and speeches, constituting this volume, analyse India’s prospects for sustainable growth and the challenges that lie ahead in this difficult period of global economic slowdown. Suggestions and insights provided by the eminent contributors will prove an eye-opener to the general readers.
It is hoped that the book would be found useful by the researchers and students of Economics, businessmen, government executives concerned with the formulation and execution of economic policies, parliamentarians, legislators and those interested in knowing about the changes that are taking place in our economy.
Dr. K.R. Gupta is a well-known Economist. He has published over a dozen of books and more than hundred papers in reputed journals, being published in India and abroad. He had been teaching postgraduate classes and guiding research for about two decades in the University of Jammu and Kurukshetra University. He has also worked as an Economist in private as well as in public sector. His last assignment was as Economic Advisor to the Modi Enterprises.
