ti n Economy from Economy from Economy from Economy from Conclusion
99 - 995 996-2000 200 -2005 2006-2009
1947-1991olici s -Soci l mocr tic-b s -Ext nsiv r gulation, - rot ctionism, - ublic owners i , Since 1991 - Continuing economic liberalisation - mar et-based system. 2000s ² evived economic reforms and better olicy - ccelerated economic growt rate. 2008 - World·s second-fastest growing major economy. 2009 - Significant slowdown in India's official G growt rate to 6.1%as well as t e - eturn of a large rojected fiscal deficit of 10.3% of G
From 1950 to 1990- economy was at its best in 1980's. But even t en t ere were structural imbalances In 1991
exports imports Foreign exchange reserves
Rs. 32,553 crores s. 43,196 crores s. 5,541 crores
Some of the major steps taken were: - Indian Industry : unshackled from unnecessary bureaucratic and governmental control. - licensing policy was abolished - Confidence of the creditors was restored ,the fear of default was dispelled. - exchange rate adjusted in July 1991 to a new level deemed credible. - Export subsidies were abolished, - fertiliser subsidy was reduced and defence expenditure was restrained. - onetary policy tightened -to control inflationary pressure - foreign investment : restricted to attract f r ign inv stment especially in priority areas including critical infrastructure sectors such as power.
- Structural reforms to enhance productivity
- Strengthening of competition in the industrial sector. - The consumer has a wide variety of goods, particularly consumer durables to choose among competing products at fairly competitive prices. - romoting an employment oriented pattern of industrialization. - Was a decade of scarce resources both domestically and externally.
Controls and procedures were revised. Number of state controlled industries: before 1990 ² 18 under new policy 9 Only including industries of national importance (military weapons, energy, environment, health etc). is-investment of government equity from public sector, enterprises, reduced from 51% to 26% quantitative restrictions were reduced on imports hased reduction of import tariff. Globalisation also meant an explosion of financial integration in world markets.
Growth rate 7.5% in 1991²2000 Business services (information technology, information technology enabled services, business process outsourcing) were among the fastest growing sectors contributing to one third of the total output of services in 2000 Nearly 10% of the population were unemployed and the overall unemployment rate was 7.3%, with rural areas doing marginally better (7.2%) than urban areas (7.7%). India's labour force is growing by 2.5% annually, but employment only at 2.3% a year.
During this period the economy grew at an average rate of 6.4% per year Poverty fell from 36 percent in 1993-94 to 26 percent or less The cumulative F.D.I in flows since 1991 increased to $ 26.89 billion s.1,03,636 crores, while approvals were at $ 72.98 billion - s. 2,67,798 crores till ugust 2001 While foreign investment, as a percentage of GDP was almost zero in 1990-91 and 0.1% in 1991-92, its average during 1992-2000 was 1.2 % For the year 2000, in respect of current competitiveness index India's rank was 37 out of 58 countries, in respect of Growth competitiveness index (GCI) India was in the 49th position out of 59 countries, in respect of Emerging arket Index India's rank at 46
Total employment Unemployment rate as measured on the basis of current daily status C.D.S Rate of growth of employment per annum Number of employed workers in the agriculture sector in Millions
375 Million 397 Million
6% 2% (1983-9394)
7.3 % 1% (93-94-992K)
The Indian economy has moved to a higher growth trajectory, with growth in GDP at market prices exceeding 8 % in every year
quotas were removed (fully only in 2001)
currency was devalued the foreign investment regime was liberalised, and various restrictions on external financial transactions were eased. Some of these reforms helped Indian business; others put enormous competitive pressure on them.
India¶s economic performance in the post-reforms period has many positive features. The average growth rate in the ten year period from 1992-93 to 2001-02 was around 6.0 percent The economy grew at an impressive 6.7 percent in the first five years after the reforms, it slowed down to 5.4 percent in the next five years The slowdown is due not to the effects of reforms, but rather to the failure to implement the reforms effectively According to the revised inflow figures, FDI was US$ 6.13 billion in 2001-02; US$ 5.04 billion in 2002-03; US$ 4.67 billion in 2003-04 and US$ 5.54 billion in 2004-05.
Manufacturing Growth of manufacturing from 3.3 % during the 9th Five Year Plan to 8.6 % during the 10th Five Year Plan.
Services The growth in the services sector continued to be broad based. Among the sub-sectors of services, ³transport and communication´ has been the fastest growing with growth averaging 15.3 % per annum during the Tenth Five Year Plan period followed by ³construction´.
Agricultural growth The coefficient of variation (CV) for the 10th Five Year Plan was, however, higher than the 60 year average.
Savings and investment
The average investment ratio for the 10th Five Year Plan at 31.4 % was higher than that for the 9th Five Year Plan, while the average saving rate was also 31.4 % of GDP higher than the average ratio of 23.6 % during the 9th Plan.
Empl yment and poverty reduction:
The ratio of persons below the poverty line declined from around 36 % of the population in1993-94 to 28 %in 2004-05 as per the uniform recall period. Based on the mixed recall period, the ratio declined to 22 % in 2004-05 from 26 % in 1999-2000
12th largest by nominal value 4th largest by purchasing power parity(ppp) Emerging economic power with vast human and natural resources & a huge knowledge base # However In 2009 1. Slow down in GDP-6.1% 2. eturn of large projected fiscal deficit10.3% of GDP
1. Agriculture: -2nd world wide in farm output -16.6% of GDP -employed 60% 0f work force 2. Industry and services: -27.6% of GDP -Employed 17% 0f work force -16th in the world in nominal factory output -15th in service output -Employed 23% work force -55% in GDP 3. Banking and Finance: -bank branches increased to 98910 -population covered by each branch is 15000 -public sector banks holds 75% where as private and foreign holds 18.2% and 6.5% respectively.
policy allows up to 100% stake in
ventures eforms :
Reduced industrial licensing Removed restrictions on expansion Easy access to foreign technology
and consumption Economic inequality Recession Inflation