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Indian Economy in the 21st Century

ACKNOWLEDGEMENT
It is a great opportunity to present this report on
"Indian Economy in the 21st Century" undertaken
by third-year engineering students from the
Information Technology Department of SIESGST as
part of curriculum under the study of "Business
Communication & Ethics".
We extend our praise for our advisor, Dr. Ram Bhise,
for we find ourselves penning down a few words on
the topic which is the need of the hour. Indian
Economy in its truest form is complex and this journey
of demystifying it has been very informative and
enlightening.
The evolving curve of Indian Economy has left a global
mark and hence spending time and effort on this topic
has been an experience that has granted us a positive
expression in the field of research and development
on the financial condition of India, at the crux of what
lays the skilled population dynamic that India enjoys.
This report entails that dynamic from a fine running
model to the most chaotic of monetary models.

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ABSTRACT
This report provides an outlook for the Indian
economy in the light of the extraordinary global boom
in economy, that started in the West, but which has
now transformed into a global economic change since
the Dot-com bubble which we refer to as the 21st
Century.
The Indian economy was noticed to be rising even
before the onset of the 21st century and hence the
timing of this report acts as an analytical viewpoint for
concerned citizens. The analysis undertaken for this
report shows what is likely to bring the Indian GDP
growth rate into the forefront. This also poses a big
challenge requiring urgent and sustained policy
attention to ensure this upturn from slowing down.
There is a real risk that the growth rate could
plummet to the pre-1980s levels if appropriate
countercyclical measures are not taken and are not
followed by necessary structural reforms. The report
provides a short-term forecast for GDP growth based
on a model of leading economic indicators. We

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present scenarios in the report assuming


differentiated impact of the world economy.
Finally the report shows a set of policy measures to
get the Indian economy on the path of sustained rapid
and inclusive growth.

PREFACE
India has emerged as the fastest growing major
economy in the world and is expected to be one of the
top three economic powers of the world over the next
10-15 years backed by its strong democracy and
strong partnerships with other major nations.
India's gross domestic product (GDP) is expected to
reach US $6 trillion by 2027 and achieve upper-
middle income status on the back of digitization,
globalization, favorable demographics and reforms.
India is expected to be the third largest consumer
economy as its consumption may triple to US $4
trillion by 2025, owing to shift in consumer behavior
and expenditure pattern and is estimated to surpass

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USA to become the second largest economy in terms


of purchasing power parity (PPP) by the year 2040.
The objective of this report is to educate the reader on
the evolving state of the country where development
and inculcation of a stable economy means that India
could emerge as strong entity in the political and
financial world.

INTRODUCTION
India is a developing country and our economy is a
mixed economy where the public sector co-exists with
the private sector. For an overview of Indian
Economy, we must first understand the salient
features of the Indian economy.

 Low per capita income.


 Inequalities in income distribution.
 Predominance of agriculture.

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 Rapidly growing population with 1.2% annual


change.
 Chronic unemployment in India is mainly
structural in nature.
 Low rate of capital formation due to less saving
rate.
 Dualistic Nature of Economy termed as Mixed
Economy.

India has followed a different path of development


from many other countries. India went more
quickly from agriculture to services that tend to
be less tightly regulated than heavy industry.
In the following sections, we will understand how the
average Indian is changing and how each sector has
reacted to the change.

SECTORS

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FIG: Distinction of Sectors


When the economic activity depends mainly on
exploitation of natural resources then that activity
comes under the primary sector.
When the main activity involves manufacturing then it
is the secondary sector. All industrial production where
physical goods are produced come under the
secondary sector.
The tertiary sector includes service industry and
involves the provision of services to business as well
as final consumers. Services may involve the
transport, distribution and sale of goods from
producer to consumers as May happen in wholesaling
and retailing, or may involve the provision of a

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service, such as in banking or entertainment. It is also


referred to as the Services Sector.
SECTORS
A. Primary Sector
When the economic activity depends mainly on
exploitation of natural resources then that activity
comes under the primary sector.
India's primary sector is Agriculture and Animal
Husbandry. When India gained independence, the
major focus was on the agriculture sector when Green
Revolution helped the sector grow tremendously. 52%
of the total population of India depends on agriculture.
According to the governmental survey of 2017-2019,
Indian agriculture contributes 14.1% of the Gross
Domestic Product (GDP). It was highest at 55.4% in
1950-1951.

India is the second largest sugar producer in the world


only behind Brazil. In tea production, India ranks first
and contributes 27% of total production in the world.

In Wheat production, domestically, Uttar Pradesh is


the largest producer. Punjab and Haryana are the
second and the third largest producer of wheat
respectively.

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In Rice production, domestically, West Bengal is the


largest producer. Uttar Pradesh is the second largest
producer followed by Punjab as the third largest
producer of rice.

SECTORS
B. Secondary Sector
When the main activity involves manufacturing then it
is the secondary sector. All industrial production where
physical goods are produced come under the
secondary sector.
India’s industrial sector accounts for 27.6% of the GDP
and gives employment to 17% of the total workforce.
Though agriculture is the foremost occupation of the
majority of the people, the government had always
laid stress on the industrial development of the
country. Thus policies and strategies were framed to
give a boost to India’s industry. The government aims
at achieving self-sufficiency in production and
protection from foreign competition. Since
independence, India is marching ahead to become a
diverse industrial base.

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Today India holds some key industries in the sectors


like steel, engineering and machine tools, electronics,
petrochemicals, textiles and software. Importance has
also been give to improve the infrastructure of the
country. The government has liberalized its industrial
policy thereby attracting huge foreign direct
investment. If on one hand several multinational
companies opened their offices in India, on the other
hand many Indian companies started their operations
in foreign countries.
The Secondary Sector in India has expanded
exponentially and has traced a rapidly positive
trajectory over the years.

SECTORS
C. Tertiary Sector
The tertiary sector includes service industry and
involves the provision of services to business as well
as final consumers. Services may involve the
transport, distribution and sale of goods from
producer to consumers as May happen in wholesaling
and retailing, or may involve the provision of a
service, such as in banking or entertainment. It is also
referred to as the Services Sector.

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The tertiary sectors may include insurance, banking


and transport. The higher the productivity in primary
and secondary sector and lower the employment in
these sectors, the better it is. They need more means
of transport, more communication and educational
facilities, more training, more medical facilities,
entertainment, technical facilities, banking facilities
and so on.
Tertiary sector depends on scientific research and
innovative developments to increase productivity and
it provides engineering and construction consultancy
support services for all projects in all sectors.
India is the fifteenth largest country in the world in
terms of services' output. This sector provides
employment to 23% of the workforce and is the
fastest growing sector, with a growth rate of 7.5% in
1991–2000 up from 4.5% in 1951–80. It has the
largest share in the GDP, accounting for 56.8% in
2017 up from 15% in 1950.

POPULATION TRENDS
The population trend in India is defined on the basis
of the size, territorial distribution, and composition of
population, changes therein, and the components of
such changes within the country.

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India's population parity can be divided into following


phases:

 Phase I: the period between 1901 and 1921,


during this period, India experienced a fluctuating
but more or less a stagnant growth in
population. This period marked a high in both
the birth and death rates.

 Phase II: the period between 1921 and 1951,


this period witnessed a steady declining
trend in population growth.

 Phase III: the period between 1951 and 1981, it


was a rapid high growth period of population
explosion in India.

 Phase IV: from 1981 to till date, India continues


to grow in size. But, its pace of net population
addition is on the decrease.

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POPULATION TRENDS
Population analysis shows that the decrease in the
rate of population has led to an increase in the pace of
economic development in the country. On the basis of
above argument the hypothesis holds true that
unexpected population growth is constraint for
development.
It is found that a quickly increasing population makes
the task of absorbing the labor force in productive
activities difficult and hence a large increase in
population is more a liability than an asset in the
developing countries. It has also been also examined
that increasing demand for agricultural land, firewood,
housing etc. results in deforestation which adversely
affects soil fertility, causes floods and affects the
climate. It can be concluded large size of population
and its fast rate of growth increases the consumption
needs.
This increases consumption expenditure. So saving
rate and capital formation does not increase much. A
part of resources mobilized by such economies are
consumed by a fast growing population like in India's.
Economic growth needs to be more equitably divided.
Investing in health infrastructure to reduce infant and
child mortality rate are some of the positive steps the

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government has taken to strengthen the human


capital.
For any economy to grow in the long term, presence
of a strong human capital is necessary. It aids in the
process of modeling India as a dominant power in the
form of a skillful and intelligent working entity.
GROSS DOMESTIC PRODUCT (GDP)
The term GDP is defined as a monetary measure of
the market value of all the final goods and services
produced in a specific time period, often annually.
India's GDP appears to be dynamic in nature staying
true to the 'mixed economy' tag. Over time, India has
matured in the rate of change of GDP but the
economic condition seems weak when accounted per-
capita wise.

FIG: Rate of change of GDP (1950-2018)

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India’s GDP is estimated to have increased 7.2 per


cent in 2017-18 and 7 per cent in 2018-19. India has
retained its position as the third largest startup base
in the world with over 4,750 technology start-ups.
India's labor force is expected to touch 160-170
million by 2020, based on rate of population growth,
increased labor force participation and higher
education enrolment, among other factors.
India's foreign exchange reserves were US$ 405.64
billion in the week up to March 15, 2019 putting
India's Reserve strength at a paramount only behind
USA and China.

GDP vs. The Population


The GDP vs. The Population is termed as the Gross
National Product, defined as value of all finished
goods and services owned by a country's residents
over a period of time.
India’s Gross National Product was reported at
2,691.042 USD billion in Dec 2018. Abject
correlation is found when population increases by
migration of workforce when these migrants will
become workers in the economy. If an economy has
more workers it has the potential to produce more
goods and services. Therefore GDP will increase. This
correlation is termed as Human Capital Index and it
portrays the growth of GDP vs. The population.

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Human capital is the stock of habits, knowledge,


social and personality attributes (including creativity)
embodied in the ability to perform labor so as to
produce economic value. Human capital is unique and
differs from any other capital. It is needed for
companies to achieve goals, develop and remain
innovative. The two major sources of human capital in
a country are (I) Investment in education & (II)
Investment in health. Education and health are
considered an important input for the development of
a nation.
Such investments provide returns to the individual as
well as to the economy as a whole. Individuals benefit
from higher earnings, and the economy as a whole
benefits from higher productivity.

In The 21st Century


India is a mixed economy with a large public sector. It
is this Principle feature of the Indian economy which
differentiates it from other economies in the world
which causes us to be one of the leading 21st century
economies.
Indian constitution has accepted the federal set-up for
the country. Because of this, the economic setup of
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the country is also federal in character. It implies that


the government economics activities and institutional
economics activities operate at two levels – at central
level and at state level.

Constitution itself has clearly distributed the powers


to regulate the economic life of the people between
the center and the states.
Indian economy was curtailed during the British rule
because of which India had been reduced to a
stagnant and backward economy. To pull India from
this state of backwardness, development plans were
initiated after independence. As a result of these
development plans, Indian economy has made
exponential progress in various fields of the economy.

In the 21st century, it is becoming clear that the


future growth is exponential. The larger economies
like India are making a comeback, and we are now
returning to the historical norm. But size itself does
not automatically confer either wealth or power. A big
state still has to take the right steps to maximize its
natural advantage.

OCCUPATIONAL STRUCTURE

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There are number of things which suggest the


progressive increase in India’s national income and
per capita income; development of basic industries
and increase in heavy industries. These changes have
been largely due to changing Occupational structure.

In terms of Occupational Structure, the distribution of


working population of an economy in different
occupations is quite flexible in the 21st century.
Occupational structure indicates the structure of
economic values. I.E. it tells us on what sector do the
People of country depend for their livelihood. Besides
this, occupational structure also indicates the
structure of the development of the economy.

The Occupational Structure of India indicates that the


country’s primary occupation still lies in the Primary
Sector followed by the Secondary sector and finally
Tertiary sector. Majority of the Tertiary sector is
employed in the urban populace while Primary Sector
finds place in the rural populace.
The shift in the occupational structure is gradual but
positive changes have been seen, largely brought by
wide investments in software, education, financial
services and other service sector entities. These jobs
have led the tax flow in the 21st century and
economists agree that these jobs will continue to grow
well into the late 21st century. This change has
effectively reflected upon the modern Indian
demographic and hence led to overall development.

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Human Development Index (HDI)


Our Constitution mentions the words "Socialist" and
"Protectionist" as the guiding principles in building of
the modern society, where every individual is assured
the basic rights of food, water and shelter, at the
same time, making sure that those deprived of these
rights will be protected and necessary measures for
their upliftment must be carried out as responsibilities
of the government.
Inclusiveness has been the cornerstone of India’s
development agenda. Over the last few years, efforts
in this direction have been accelerated by the
Government through the mantra of inclusiveness
‘Sabka Sath, Sabka Vikas’, further elaborated by
ensuring ‘Sabka Vishwas’. As India is a developing
economy with resource constraints, we have to
prioritize and optimize the expenditure on social
infrastructure to promote sustainable and inclusive
growth. It is critical at this juncture to focus on public
investments in human capital and strengthen the
delivery mechanisms of government interventions to
ensure transparency and accountability. With India
having the demographic advantage, improving
educational standards, skilling the youth, enhancing
job opportunities, reducing disease burden and

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empowering women will help in realizing the potential


of a buoyant economy in the future.

The public investments in social infrastructure like


education, health, housing and connectivity have a
critical role in ensuring inclusive development in a
developing country like India.

Human Development Index (HDI)

India's development trajectory is critically


intertwined with the investments in social
infrastructure. To reap the benefits of
demographic dividend, the government has to be
committed to improve the outcomes in education
and skilling, and to provide employment and
affordable healthcare to all. Scaling up
development programs for improving
connectivity, providing housing, and bridging
gender gaps in socio economic indicators is of
paramount importance for sustainable
development. India's march towards achieving a
high HDI score is firmly anchored in investing in
human capital and inclusive growth.
India continues to remain the fastest growing major
economy in the world in 2018- 19, despite a slight
moderation in its GDP growth from 7.2 per cent in
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2017-18 to 7 per cent in 2018-19. On the other hand,


the world output growth increased from 3.8 per cent
in 2005 to 5.6 per cent in 2018, these figures have
been paramount in establishing a confidence in the
Indian markets' for the foreign investors, who see
India not only as a cash-rich ecosystem but also as a
reliable one.

India has a long way to go in the journey of attaining a


respectable HDI score with respect to its western
developed counterparts but steady growth and
investments in fields of skilled human capital can
ensure that such a goal can be achieved within 30 to
40 years.

Industry & Infrastructure


In a fast moving world, in order to maintain growth
momentum, India has to develop its industry and
infrastructure. As an emerging economy, the scope for
Industry and next-generation infrastructure are
enormous. To experience the potential of
the perfect blend of Industry and next-generation
infrastructure, it is necessary to clear the decks which
are obstructing the
way forward. Industry encompasses automation in
industrial sectors whereas next-generation
infrastructure brings physical
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infrastructure and technology like internet of things,


automation together to maximize the efficiency of
physical infrastructure.

For a smooth and fast travelling, India needs adequate


and timely investment in quality infrastructure. In
order to create a five trillion dollar economy by 2030s,
India needs a robust and resilient infrastructure. Public
investment cannot fund the entire
infrastructure investment requirements of the country.

There is a need for establishing an institutional


mechanism to deal with time-bound resolution of
disputes in infrastructure sectors. Many large
Companies are eager to bring their capital into
developed India as compared to less developed
states. Therefore, the real challenge lies in bringing
adequate private investment across the country with
the collaboration of public sector. Along with physical
infrastructure; provision of social infrastructure is also
equally important as these two would determine
where India will be placed in the world by turn of the
century.

Sustainable Development

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In adoption of a responsible global agenda, the


country is moving forward towards achieving a society
free from poverty, gender inequality and economic
inequality and thereby ensuring a healthy planet for
future generations. These goals are multi-dimensional
and integrate various social, economic and
environmental dimensions. India continues to target
and maintain its economic growth by introducing and
implementing various policies and measures relating
to sustainable development, climate change, resource
efficiency and air pollution.
India has been progressing rapidly towards achieving
the Sustainable Development Goals, termed by the
government as SDGs. With increasing demand for
resources to cater to the different developmental
needs, policies need to nudge economic agents
towards achieving the maximum output from the
available resources. Developing countries like India
need to endeavor to do the best possible within their
own domestic resources, keeping in mind the
sustainable development imperatives. It is time for
the global community to exhibit the requisite
momentum to act upon their responsibilities on
establishing the enabling environment for sustainable
development and climate actions.

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Climate Change remains a very important topic and


India has continuously demonstrated its responsibility
towards acknowledging the emerging threats from
climate change and implementing climate actions, on
the basis of the principles of Equity and Common but
Differentiated Responsibilities.

Sustainable Development
Sustainable Development practices by India need
positive engagement to result in protection of key
interests including recognition of different starting
points for developed and developing countries.
India has set clear targets for achieving its climate
goals. However, a substantial scaling up of financial
resources and technology are needed to implement
this target by 2030-40s. The fulfillment of pledges by
developed countries through provision of ‘new and
additional’ financial resources is an important
contingent factor. The developing countries like India
will endeavor to do the best possible within their own
domestic resources, keeping in mind the sustainable
development imperatives. It is time for the global
community to exhibit the requisite momentum to act
upon their responsibilities on establishing the enabling
environment for climate action.

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Recent happenings in the country regarding Coal


plants, Nuclear energy, Metro construction and newer
technologies like hyper-loop etc. have tendencies to
corrode the nature at a much faster pace than
expected, hence necessary measures need to be
implemented to keep factors like deforestation, soil
erosion, contamination of water table in check.
This essentially means that along with domestic public
budgets; international public finance and private
sector resources would have to be mobilized from a
variety of sources to ensure healthy future for the
country.

Inflation & Poverty


In India's context, Inflation corresponds to the
component of inflation that is likely to continue for a
long period mainly due to the steady increase in
consumer spending and better standards of living
which inturn affect the purchasing power parity. Thus,
contextual inflation captures the underlying trend of
inflation and is, therefore, unstable. Unlike the non-
core component of inflation, core inflation is not
affected by temporary shocks.

In India, core inflation is generally measured by


excluding highly volatile components from the non-
core inflation. By their very nature, food and fuel have
been highly volatile. Therefore, we arrive at core

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inflation by removing food and fuel components from


the non-core inflation. As non-core inflation exhibits
volatility due to short run shocks, Central banks in
many countries focus on core inflation. The economy
witnessed a gradual transition from a period of high
and variable inflation to more stable and low level of
inflation in the last 25 years owing to reforms
undertaken to end the License-Raj in 1991; effectively
removing what most economists call the "Hindu
Growth Rate" and replacing it with a stable long-
standing growth rate.

Analyzing the data gathered over the last five years,


CPI inflation declined to 3.4 per cent in 2018-19 from
3.6 per cent in 2017-18, 4.5 per cent in 2016-17, 4.9
per cent in 2015-16 and 5.9 per cent in 2014-15,
hence CPI, which stands for Consumer Price Index, has
steadily increased while Inflation rates have
decreased. If the trend continues then India might
reach saturation in rates of Inflation and eventually
head towards a stable economy.

Inflation & Poverty


India is one of the fastest-growing economies in the
world, poverty has been on a decline with close to 44
Indians escaping extreme poverty every minute. India
has been able to lift significant percentage of its
population out of poverty but many suffer. It had 73

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million people living in extreme poverty which makes


up 10% of its total population as of 2019.
The Government reviewed and proposed revisions on
May 2012 to its poverty calculation methodology and
purchasing power parity basis for measuring poverty
which was a minimal 3.6% in terms of percentage. As
of 2019, the incidence of multidimensional poverty
has almost halved between 2005–06 and 2015–16,
climbing down to 33.8 percent from 54.7 percent
owing to affordable housing 19nd lower rates of
inflation. India has lifted 271 million people out of
poverty in just 10 year time period from 2005-06 to
2015-16 which is commendable and with deeper
economic measures by the government, we can
ensure removal of extreme poverty by 2050.
The Indian government and non-governmental
organizations have initiated several programs to
alleviate poverty, including subsidizing food and other
necessities, increased access to loans, improving
agricultural techniques and price supports, promoting
education and family planning. These measures have
helped eliminate famines, cut absolute poverty levels
by more than half, and reduced illiteracy and
malnutrition.
In order to help reduce rural poverty gap and seasonal
poverty Government needs to make sure that
deprivation of classes tends to decrease over time,
and that the most deprived sections have their basic
needs satisfied.

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The Vision Ahead


This century poses several challenges for the Indian
Economy. Firstly, there are apprehensions of slowing
of growth, which will have implications for revenue
collections. Secondly, the financial inflation globally
has increased considerably Therefore, revenue
buoyancy will be key to improved resource position of
both Central and State Governments. Thirdly, the
resources for now expanded vision of a trillion dollar
economy, as well as new initiatives of the new
Government, will have to be found without
compromising the fiscal deficit target as per the
revised glide path.

A stable political mandate for the government is


preferable, which augurs well for the prospects of high
economic growth. Real GDP growth for the year 2020-
30 is projected at 7 per cent, reflecting a recovery in
the economy after a deceleration in the growth
momentum throughout 2010-20. The growth in the
economy is expected to pick up in 2025 as
macroeconomic conditions continue to be stable while
structural reforms initiated in the previous few years
are continuing on course. Investment rate is expected
to pick up further on the back of higher credit growth
and improved demand. The political stability in the
country should push the animal spirits of the
economy, while the higher capacity utilization and

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uptick in business expectations should increase


investment activity.
Accommodative monetary policy should help in
decreasing lending rates. The performance of
consumption will be crucial in deciding the growth
path of economy. Rural wages growth, which has
started to increase since mid-2000s, should help spur
rural demand. Pick up in food prices should help in
increasing rural incomes and spending capacity and
hence rural consumption demand. The condition of
minimum land holding has been subsequently
removed to benefit all farmers.
The Vision Ahead

The impact of the NBFC (Non-Banking Financial


Companies) sector spills over to lower credit on-take
which stimulates growth in consumption spending.
Reorientation of trade policies to target markets based
on our own relative comparative advantage and the
importing country’s exposure to Indian goods can
foster export performance. Under status quo, the
outlook for the global economy is vibrant, with most of
the industries projected to boom in the coming
century. The major threat facing the world economy is
the increase in trade tensions between U.S. and
China, which could lead to large disruptions in global
value chains, outcome of Brexit and downside risk to
China’s growth.

The economic factors are benchmarked on various


parameters based on their performance across access
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and equity in education, and relevance and quality,


governance and funding, and excellence.

 Sustained Leadership can guarantee above-


average performance of all the sectors.
 Deepen Impact and induce high performance
policies on quality, easily accessible and skilled
human capital.
 Invest in Quality as well on country-made which
maybe low on quality but can spring up in the
long turn.
 Reorient Educational Infrastructure.
 Restructure the defense budget& ensure secure
economic state.
 Refined trade policy and flexible exchange of
goods.

CONCLUSION
In recent years, India has witnessed an information
explosion with exponential increase in the amount of
globalization. As people increasingly use digital
services to talk to each other, look up information,
purchase goods and services, pay bills, transact in
financial markets, file taxes and avail welfare services,
navigation this modern economy has become a
tedious task.

Navigating in an uncertain and wobbly economy


requires constant monitoring of the path followed by
the economy using real-time indicators. Thus, the
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internet can serve as the stones that enable one to


cross the river. Concurrent with the digital explosion of
recent years, the cost of livelihood has declined
exponentially while its marginal benefit to society has
increased manifold. Therefore, society's optimal
consumption of resources is higher than ever.

While private sector does a good job of harnessing


data where it is profitable, government intervention is
needed in social sectors of the country where private
investment in data remains inadequate. The
Government already holds a rich repository of
administrative, survey, institutional and transaction
data about citizens, but this data is scattered across
numerous government bodies. Utilizing the
information embedded in these distinct datasets
would enable the government to enhance the ease of
living for citizens, enable truly evidence-based policy,
improve targeting in welfare schemes, uncover unmet
needs, integrate fragmented markets, bring
greater accountability in public services, generate
greater citizen participation in governance etc.

CONCLUSION
In the spirit of the Constitution of India, the republic
must should be "of the people, by the people, for the
people". The global infrastructure has largely proved

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reliable, fast and secure enough to handle this deluge


of wealth.
As witnessed over the past two centuries, energy has
been the driving force behind the process of economic
development: greater access to energy has fostered
economic growth as well as other
indicators of human development. India has a per-
capita energy consumption of only about one-third of
the global average and hence with changes in
standard of living, the amount of energy is only
expected to rise in the 21st Century hence the
country faces the task of mitigating its needs in terms
of Energy.

The pace of reform is quite remarkable given the


complexity of the federal structure of government and
the diversity in terms of culture, languages,
geography and level of development across the
country. Growth has also become more inclusive as
about 140 million people have been taken out of
poverty in less than 10 years. India has relied on large
welfare programs including price-support for food,
energy and fertilizers and has the world’s largest
program guaranteeing the “right to work” in rural
areas.

The on-going reform of these schemes towards better


targeting of those in need, reducing administrative
costs and corruption, and supporting financial
inclusion could serve as best practice for many
emerging economies. However, many Indians still lack

31 | B C E R E P O R T
Indian Economy in the 21st Century

access to core public services, such as electricity and


sanitation. Public spending on health care, at slightly
more than 1% of GDP, is low.

CONCLUSION
Although almost all children have access to primary
education, the quality is uneven. Female labor force
participation remains low. However, some other
indicators of gender equality have improved, such as
female life expectancy at birth and participation in
education. Deprivation is pronounced in rural areas
and urban slums although some states have reformed
to reduce poverty.

The current century is marked by a number of key


structural initiatives to build strength across macro-
economic parameters for sustainable growth in the
future. The growth has stood strong despite global
tailwinds and the weakness seen at the beginning of
the century seems to have bottomed out as the
modern monetary flow has set in.

Currently, the economy seems to be on the path to


recovery, with indicators of industrial production,
stock market index, auto sales and exports having
shown some uptick . Most economists believe that
India’s economic outlook remains promising for the
next 50-60 years and is expected to strengthen
further in the future.
32 | B C E R E P O R T
Indian Economy in the 21st Century

The biggest challenges for the country is how the


economy can maintain its recovery in the face of
increasing inflationary pressures, coupled with a
higher fiscal deficit as well as an increasing debt
burden. The key to this conundrum lies in the revival
of consumer demand and private investment.

The objective of this report is to present an analysis of


the current Indian economic scenario along with the
expectations from the period ahead.

BIBILOGRAPHY
https://www.finmin.nic.in/

 https://www.indiabudget.gov.in/
 https://doe.gov.in/orders-circulars
 https://financialservices.gov.in/
 https://dea.gov.in/
 https://en.wikipedia.org/wiki/Economy_of_India
 https://www.livemint.com/
 https://www.investopedia.com/
 https://economictimes.indiatimes.com/news/econ
omy/fin
 https://www.businesstoday.in/
 http://academicfoundation.org/index.php?

route=product/product&product_id=492
 http://planningcommission.nic.in/aboutus/speech/
spemsa/msa011.pdf
 https://www.niti.gov.in/
 https://www.pmindia.gov.in/en/tag/niti-aayog/

33 | B C E R E P O R T
Indian Economy in the 21st Century

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35 | B C E R E P O R T

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