MACRO ECONOMICS

ASSIGNMENT 1

ANALYSIS OF NATIONAL
INCOME TREND &
INFLEXION POINTS

ANANDH M - FT152020
R VIGNESH - FT152046
NARAYANAN K SUBRAMANIAN - FT152066
ADITI - FT152047
LOKESH CHANDNA - FT152087
MANZOOR A - FT152099

ANALYSIS OF INDIAS NATIONAL INCOME TREND SINCE 1951

1951-1965: Post Independence, there was extreme poverty and economic stagnation. This period
witnessed rapid industrialization.
1966-1980: Economic growth was extremely volatile due to the 1971 war, successive changes in
Government and the huge drought in 1979.
1981-1991: During the 1980s, the businesses were able to drive efficiency and react to supply and
demand incentives, the economy took off.
Since 1991: Economic liberalization of India began in 1991.

INFLEXION POINTS SINCE 1991

1991-2001: The Balance of Payments crisis of 1990 and subsequent policy changes led to a
temporary decline in the GDP growth from 4.9% in FY 1990 to 1.1% in 1991 and devaluation of the
rupee. The abolition of License Raj and economic reforms were forced upon India wherein, licensing
regulations were reduced, tariffs were reduced along with duties and taxes and the economy was
opened up to International trade & investment.
2001-08: India enjoyed high growth rates for a period from 2003 to 2007 with growth averaging 9%
during this period. Growth then moderated due to the global financial crisis starting in 2008.
2008-12: US & Euro Crisis Global slowdown due to unfolding of Eurozone debt crisis has impacted
the Indian economy through deceleration of exports, widening of trade and current account deficits,
decline in capital flows, fall in the value of the Indian rupee, stock market decline and lower
economic growth. 2010 saw a growth in GDP due to manufacturing, retail and IT sectors.
Since 2012: India entered a period of more anaemic growth, with growth slowing down to 4.4%.
Other economic problems also became apparent: a plunging Indian rupee, a persistent high current
account deficit and slow industrial growth.