The Indian economy is expected to grow 7.2% this year. This raises the possibility that state support will cut back.
The state has put into place fiscal strategies to maintain growth during the economic downturn.
There has been strong growth in the manufacturing sector of India to make up for a fall in agricultural output.
Now there is talk of raising interest rates before expected and possibilities of government composing some exit strategies.
Concentration is shifting from economic growth, to inflation.
I think it's important for the Indian government to step back now that growth is steady and put more concentration on their growing inflation. It's incredible to see how much this nation has grown during these years of economic crisis.
It will be interesting to see what kind of fiscal policies they will implement to help reduce their unemployment.
ReplyDeleteThis can be compared to what we learned in class where Fed's announcement of increasing money supply can have significant impact on people's spending. Similarly an expectation of 7.2% growth will bring confidence to people to start spending and investing more which will give a boost to the economy.
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