India's growth: Its problems and solution

Indian economy has been growing at a rapid pace for the past 5 years barring the
slow down during the crisis year. The main driver of this growth has been our s
ervice sector and the burgeoning foreign reserves thanks to the FDIs and FIIs fl
owing into India
The growth rate of any economy is measured in terms of increase in gross domesti
c product (GDP) in a given time period. GDP is the net value of all goods and se
rvices produced within a country in a given time period.
Indian economy is broadly divided into 3 sectors
i) Agriculture sector
ii) Industrial sector
iii) Service sector
Agriculture sector:
It employs 60% of our workforce. However it s contribution to GDP is disproportion
ately low. Hence the fruits of growth and development don t reach these 60%. Effor
ts need to be made to boost agriculture sector as india is mainly an agrarian ec
onomy. India is bestowed with large land area criss crossing with rivers and str
eams. Optimum utilisation of resources can lead to maximising yield and hence mo
re money in the pockets of the farmers. Micro watershed management needs to be t
aken up on a priority basis especially in drought prone regions. Scientific agri
culture should be adopted. Research findings need to be implemented. All these m
easures along with a holistic developemnt of key social sector areas can lead to
a sustainable and higher growth of our agriculture sector
Industry sector:
We have the advantage of a huge population and this can serve as a huge demograp
hic dividend for our country. But the lack of skill among majority of work force
is an area of concern. In this land of a billion, employment is never a problem
but lack of employable skills denies many a denizens the right to lead a dignif
ied and prosperous life. Every year an estimated 15 million workforce enter the
job market. But our institutions can train only a 3 million workforce. This is a
n area of concern.
Our industrial sector has attracted large foreign investments. Indian industry o
ffers the following advantages
i) Cheap labour
ii) Cheap raw material
iii) Big and diverse market
However there is lot of scope to increase foreign investment in our industries.
There are certain bottlenecks which need to be removed. They are
i) Obselete and stringent labour laws
ii) Inefficient banking system
iii) Overstressed physical infrastructure
Labour laws need to be amended to provide for easy shutting down of industries.
Our banking systems are slow interms of verification and approval loans. Our por
ts are painstakingly slow in unloading and laoding, our roads are crowded and ou
r power supply is frequently interrupted. The golden quadrilateral has adressed
the problem of roads to some extent. But freight movement is mostly through rail
ways . Railways need to implement the freight corridor project at war footing in
order to not deny india the opportuniy to grow at over 10%. Our power stations
are unable to meet the growing needs of differen sectors. The give away schemes
of govt towards agriculture have resulted in disproportionate(over 80%) consumpt
ion of power in agriculture sector.
Power supply systems are easily tamperable and are hence prone to leakages. Meas
ures need to be taken to ensure optimum utilisation of our power resources.
Services Sector:
Services sector employs around 20% of our work force and contributes to over 60%
of our GDP. Services like Software, Hotels , Tourism have helped in boosting in
dia s image at international level. In the crisis period Software exports and work
er remittances kept us afloat and ensured india was among the handful countires
that showed a positive growth. Improvements in communication technology has help
ed in sectors like BPO to flourish. India has excelled in field of software whil

e china is leader in hardware. A harmonious partnership between the two asian gi

ants can ensure a boost in foreign trade.
Despite delivering a positive growth rate , we still arent able to put money int
o the hands of poor. The reason for this is the unbalanced regional development.
Over 50% of FDI is concentrated in Mumbai and Delhi. This is majorly because of
the infrastructure and transport facilities in these regions. With such high di
sparities it is difficult to achieve inclusive growth. Innovative concepts like
rural BPOs need to be encouraged to deliver the fruits of India s growth in the hi
nterlands.

NRHM challenges and success

Purpose: universal access to affordable, equitable and quality healthcare
successes
increased health finance
revived the helaht delivery systems
traine dhelath care staff
established institutionals tandards
facilitated inc entralised procurement of drugs
village health and hospital committees
challenges
health is a state subject
while center funds NRHM, state implements it
to ensure uniform quality and standard of health care dleivery across country, c
enter needs to play rle in implementation
SOLUTIOn: bring it under concurrent list
improve governance
study of NRHM process inidcators like
utilisation of funds
improvement in healthcare delivery
community participation
it is observed that there is wide variation across states and regions
good performance states have improved while regions which had poor indices conti
nue to remain so despite more funding for poor regions
there is need for overall improvement of governance in poor performance states
increase funding
current funding 1% of GDP
developed nations: 5-10% of GDP
need to increase to 2-3%
prevent diversion of funds
expand focus
current focus on maternal and child health
need to expand focus onto general health problems
urban health
National urban health mission should be given equal priority as NRHM
urban health care has glaring deficiencies
Evaluation criteria
current assessment based on process indicators
finance
infra
personnel
shift to indicators of efficient functioning and assess health outco
mes
differential payments for staff serving in remote and difficult terr

ains
health information monitoring
community monitoring and social audits
empower local communities
approach
coordinate with various other schemes
aim for poverty reduction, social exclusion and gender discriminatio
n
funding priorities
why increase fundings?
better health of people leads to more economic growth
NRHM should be made integral part of FYPs
NUHM should get equal funding and work in coordination with NRHM
improve governance
develop system to monitor and audit performance