Agriculture is the predominant occupation
in India, accounting for 60% of employment,service sector makes up 28% and industrial
sector 12%. In terms of output, the agricultural sector accounts for
28% of GDP; the service and industrial sectors make up 54% and 18% respectively.
India's GDP is US$1.089 trillion, which makes it the twelfth-largest economy in
the world or fourth largest by
purchasing power adjusted exchange rates. India is fifteenth in services
output and it provides employment to 23% of work force, and it is growing fast,
growth rate 7.5% in 1991–2000 up from 4.5% in 1951–80. It has the largest share
in the GDP, accounting for 55% in 2007. India's IT industry, despite contributing
significantly to its balance of payments, accounted for only about
1% of the total GDP or 1/50th of the total services in 2001.
Statistics of the WTO in 2006, India's total
merchandise trade (export + import) was valued at 294 billion dollars in 2006
and India's services trade inclusive of export and import was 143 billion
dollars. According to the CIA Factbook (2007), India is a net importer. Total
imports stood at US$224 billion and exports were US$140 billion. International trade as a proportion of GDP
reached 24% by 2006, still relatively moderate.India currently accounts for
1.2% of World trade as of 2006 according to the WTO. Until the liberalisation
of 1991, India was largely and intentionally isolated from the world markets,
to protect its fledging economy and to achieve self-reliance.The FDI inflow for
2007-08 has been reported as $24bn. This is mainly due to the heavy returns the
FII’s are making due to the speculative returns gained, through Induan Stock
market’s. In
2006, remittances
from Indian migrants overseas made up $27 billion or about 3% of India's GDP.
The Indian Gross Domestic Product
(GDP) has come a long way since its balance of payment downturn in the 80's.
This can be largely attributed to its open policies under prime minister Atal
Bihari Vajpayee in 2003, attracting high influx of foreign investors. India 's BPO
sector and service industry has also benefited from its rapid growth of
information technology, further strengthening its impressive growth and thus
providing promising outlook for future growth. The contribution of IT to GDP increased to 4.8 % in 2005-06 was
projected to increase to 7% of GDP in 2008 which never materialised due to
faulty policies of UPA Govt.
India's nominal per capita
income US$977 is ranked 128th in the world. 85.7%
of the Indian population is living on less than $2.50 (PPP) a day in 2005,
compared with 80.5% for Sub-Saharan Africa, with over 83.6
Crores of the Indian population earning an income of less than Rs. 20 per day.
Half of children are underweight,
one of the highest rates in the world and nearly double the rate of Sub-Saharan
Africa.
Gross Domestic Product (GDP) is the sum of all Goods and Services produced
in a Country. This sum is the value measured in terms of Rupee. Inflation in general terms is defined,
as more money chasing few goods. Hence a mild inflation is necessary to keep
the economy progressing. India 's
projected a lower inflation rate in 2008 from the 5.77% reported in 2007. By
July 2008, the Key Indian Inflation Rate has surpassed the 11% mark to become
the highest rate recorded in 13 years, and almost three times as high as the
4.1% targeted by Reserve Bank of India (RBI) in 2007. However an Hyper Inflation (as off today) is very
tricky, as the value of goods produced in terms of Indian rupee is inflated
hence leading to increase in the figure of goods and services produced in a
country which automatically pushes the GDP of the country, without effecting
the real production of goods and
services in the country, hence reflecting artificial growth.
Stock
Exchanges are defined as the "Barometer
of the Economy". Shares, securities and Bonds of various
companies and PSU's are listed and openly traded daily here, by the investors
and institutions. Hence those Companies and sectors of the Industries that are
performing well are in demand; and their prices are ever rising. Manomohan
Singh’ tenure as a Finance and currently as the Prime Minister has seen the
Largest Fluctuation of Indian Stock Market, where the market has seen the
highest up-swings and downwards speculative movements, inviting speculative
trading instead of investment’s in the economy, the basic purpose which the
Stock exchanges serve. The Indian Public has lost heavily in this period, at the
cost of FII’s and financially strong and prudent Institutions. On 24th October 2008 the
Indian Investors had lost Rs. 3.3 Lakh
Crores in a Single Day.
The Capital Market Survey of Data
for 2000 Companies in India in Aug 13, 2007 issue reported the Huge Jump in
other Income of companies mainly due to large gains on hedging foreign exchange
(Forex) receivables and translation of forex liabilities. Companies that have
raised substantial funds in forex were major gainers. The sharp rise in rupee
against dollar and increase in refinery margin lifted profit and/or reduced the
losses of PSU oil refineries. Forex gains helped Airlines to post Profit
against loss. The Air conditioner industry had an exceptionally strong quarter
due to high demand growth as well as benefits from rupee appreciation. Similar is the case of Commodity exchange
where prices of food grains were hiked and manipulated and is speculative,
though in actual terms the economy of goods (both Agriculture and industrial)
has not shown any positive growth. Industrial output, which has been slowing
down for some time with industrial production for October 08 down - 0.4% from
the 12.2 % from Oct ’07, -1.2% in Feb 2009, -2.3% in March
‘09. This is the first time in 15 years that year to year growth has been
negative for any month.
All major economic indicators are
showing signs of negative growth. Due to global depression there is large scale
un-employment and worker and employees are regular losing jobs and facing pay
scale cuts. Interestingly the industrial growth has picked is up 2.7 % in
May’09 to 8.2% in June’09 in consonance with the price rise, and immediately
after the UPA was voted to power. The growth to a certain respect is due to
mining growth of 9.9% in July mainly due to KG basin gas production and cement
production growth of 17.75% in August ’09. Still there are no signs of stopping
of inflation and goods of common man use have risen to sky high prices. This is
despite the fact that our Prime Minister and his team are well known economist
and the P.M has served the RBI as an employee and Governor for several years.
Hence he is well versed with the Monetary and Fiscal measures employed to
control Indian inflation and price rise. Maneconomics has always been aimed with a short term gain and based
more on the supply of money rather than other realistic measures which would
serve the long term strategic interest of the country. The blame for price rise
is shifted on state Govt. though all Macro and Micro economic measures to
control price rise is with the Central Govt. It appears that the Manmohan
Singh’s government is purposely promoting inflation in order to show higher GDP
growth, though in actual production and quantitative terms the Indian gross
Domestic Production is showing a negative growth. It is this window dressing
approach of Central Government that is hampering the overall long term economic
growth of the country.
Reported and published in Nov 8, 2009 Organiser
