{"id":243281,"date":"2023-05-20T19:23:16","date_gmt":"2023-05-20T13:53:16","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=243281"},"modified":"2023-05-20T19:23:16","modified_gmt":"2023-05-20T13:53:16","slug":"about-indias-economic-growth-a-sustainable-growth-rate","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/about-indias-economic-growth-a-sustainable-growth-rate\/","title":{"rendered":"About India’s economic growth: A sustainable growth rate"},"content":{"rendered":"\n

Source:\u00a0<\/strong>The post is based on the article\u00a0\u201cA sustainable growth rate\u201d <\/strong>published in the Indian Express <\/strong>on\u00a020th\u00a0May 2023.<\/b><\/strong><\/p>\n

Syllabus<\/strong>: GS \u2013 3: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.<\/p>\n

Relevance<\/strong>: About India’s economic growth.<\/p>\n

News<\/strong>: In the past four decades and more, the structure of India\u2019s economy has changed drastically.<\/p>\n

What are the structural changes India witnessed in the past four decades?<\/h2>\n

Compared to 1980-81, using current prices, a)<\/strong> The share of \u201cagriculture and allied activities\u201d has dropped from 38% of GDP to 21%, b)<\/strong> The share of services has grown from 37% to 53%, c)<\/strong> Industry
\n(including construction and utilities) has remained more or less unchanged at 26%.<\/p>\n

What does the structural change mean for overall economic growth?<\/h2>\n

Increase in life expectancy and associated benefits<\/strong>: Life expectancy was 54 years in 1980. But it is currently estimated at 70 years. This means the average Indian no longer dies in his\/her working age.<\/p>\n

This has improved productivity and increased the rapid spread of education, including post-school education, where enrolment levels have grown sharply.<\/p>\n

Rate of investment<\/strong>: There is an increased rate of investment in fixed capital (up from 19.7% of GDP in 1980-81 to 28.6% before the pandemic).<\/p>\n

Further, there is a high spread of digitisation.<\/p>\n

Healthy economic growth<\/strong>: Indian economy\u2019s potential for annual growth should have become at least 7%. In the two decades prior to the pandemic, India through many ups and downs averaged annual growth not far short of 7%.<\/p>\n\n\n\n
Read more: India\u2019s growth rate: Aiming for the high road<\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

How did the pandemic impact India’s economic growth?<\/h2>\n

With the global economic slowdown post-pandemic, the International Monetary Fund (IMF) thinks India\u2019s potential for growth has suffered and reduced the growth forecast. This is because with Covid India has a)<\/strong> more people falling back on low-productivity agriculture, b)<\/strong> a lower ratio of worker population to total population, c)<\/strong> damage to small and medium enterprises, d)<\/strong> a shortage of consumption and (consequently) investment demand, e)<\/strong> higher level of public debt, and f) <\/strong>government policy errors (like staying out of regional trade agreements).<\/p>\n

What India needs to do to boost India’s economic growth?<\/h2>\n

India should make heavy investments in transport infrastructure<\/strong>. India should also raise the country\u2019s capacity<\/strong> for generating growth and employment. This will revive the Indian economy.<\/p>\n","protected":false},"excerpt":{"rendered":"

Source:\u00a0The post is based on the article\u00a0\u201cA sustainable growth rate\u201d published in the Indian Express on\u00a020th\u00a0May 2023. Syllabus: GS \u2013 3: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment. Relevance: About India’s economic growth. News: In the past four decades and more, the structure of India\u2019s economy has changed… Continue reading About India’s economic growth: A sustainable growth rate<\/span><\/a><\/p>\n","protected":false},"author":10311,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[216,10500],"class_list":["post-243281","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-3","tag-indian-express","entry"],"jetpack_featured_media_url":"","views":{"total":8,"cached_at":1698358312,"cached_date":1698402855},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/243281","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10311"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=243281"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/243281\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=243281"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=243281"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=243281"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}