This article talks about the possible rise of the Indian growth rate after a two year slowdown.The Indian economy is predicted to have a growth rate between 6.1% to 6.7 % in 2013-2014 according to a forecast by the finance ministry. This is good to hear after the growth rate fell to 5% in 2012-2013.
There were many factors that were at blame to the recent slow growth of the Indian economy , despite the slowdown the service sector has shown more resilience to worsening external conditions than agriculture and industry.The recent government reforms that allow foreign investment into the country has sparked a lot of opposition , this lead to a two day strike by all the major trade unions . This coasted millions of dollars of loss for the Indian economy but the Prime Minister assures that there reforms would help generate employment and also help strengthen the growth process of the country.
http://www.bbc.co.uk/news/world-asia-india-21598743
There were many factors that were at blame to the recent slow growth of the Indian economy , despite the slowdown the service sector has shown more resilience to worsening external conditions than agriculture and industry.The recent government reforms that allow foreign investment into the country has sparked a lot of opposition , this lead to a two day strike by all the major trade unions . This coasted millions of dollars of loss for the Indian economy but the Prime Minister assures that there reforms would help generate employment and also help strengthen the growth process of the country.
http://www.bbc.co.uk/news/world-asia-india-21598743
The projected growth rates have always been high, even for the last 2 years. This time, however, with the inclusion of FDI in retail sector, there is bound to be an increase in growth and employment. However, this would not be the sole factor influencing growth. Rising inflation has lead to increased prices and the average consumer's confidence is low. Till the time the consumer confidence is low, India would be unable to achieve full potential growth.
ReplyDeleteThe increase in FDI in the retail sector is a good sign that the increases in growth and employment will lead to a stable economy since the service sector did not weaken.
ReplyDeletePredictions about India's growth rate have traditionally been somewhat over optimistic. However, with the passing of reforms in the retail sector regarding FDI, India's growth does seem to be in a better place.
ReplyDeleteIf the country's manufacturing sector begins to perform well, the growth rate could likely return to its earlier levels.
Though the recent strike may have temporarily slowed the economy down, I feel that the new reforms to allow foreign investment will more than offset this effect. These reforms should cause imports and exports to increase, which in the end will benefit India's economy.
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