Understanding the

Indian Economy from the

Post-Reforms of 1991,
Volume II
Understanding the
Indian Economy from the
Post-Reforms of 1991,
Volume II
Anatomy of the Indian Economy

Shrawan Kumar Singh

Understanding the Indian Economy from the Post-Reforms of 1991, Volume II:
Anatomy of the Indian Economy
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 Abstract
This book is the second in the series of eight such volumes and consists
of 13 chapters. All the chapters are important for a study of the Indian
economy as they are devoted to topics like nature and structure of the
Indian economy; dominance of the unorganized sector; natural resources
of India; economic infrastructure; social infrastructure; manpower—
demographic profile; poverty in India—nature, dimension, and policy
measures; unemployment—forms, magnitude, and policy; inequality of
income and wealth; national income; capital formation—savings and in-
vestment, role of noneconomic factors such as cultural, social, legal, and
political influencing the economy; and sources of data for studying the
Indian economy.
India’s diverse economy encompasses traditional village farming,
modern agriculture, handicrafts, a wide range of modern industries, and
a multitude of services. Services are the major source of economic growth,
accounting for more than half of India’s output with less than one-third of
its labor force. The Indian economy has progressed structurally in terms
of the growth of capital goods industries, expansion of infrastructure, per-
formance of the public sector, and so on. Significant progressive changes
have taken place in the banking and financial structure. The structural
change has been very slow, but has virtually given a fillip to the traditional
and stagnant economy. These factors, over the years, are believed to have
created an element of dynamism in the country’s economy, and one can
now hopefully say that it would sustain development in the future.
Economic reform provides a fillip to structural change. The economy
is moving out of the negative legacies of the past. At present, though, the
Indian economy is in the midst of a slowdown in the investment and
savings rates, amidst the incidence of shocks, the Indian economy has
exhibited tremendous resilience. The direction of reform hinges on polit-
ical will. Efficient markets and effective governments, together, adapting
to each other as time and circumstances change, provide the way forward
in the development of the Indian economy. India must prioritize growth
and marshal resources to that end.
vi ABSTRACT

Keywords
agriculture; demographic profile; economic reforms; external sector;
­Indian economy, natural resources; poverty; unemployment
 Contents
Preface...................................................................................................ix
Acknowledgments....................................................................................xi

Chapter 1 Indian Economy: Nature and Structure..............................1

Chapter 2 Dominance of the Unorganized Sector.............................11
Chapter 3 Natural Resources of India...............................................21
Chapter 4 Economic Infrastructure..................................................35
Chapter 5 Social Infrastructure.........................................................55
Chapter 6 Manpower: Demographic Profile.....................................67
Chapter 7 Poverty in India: Nature, Dimension, and Policy
Measures..........................................................................79
Chapter 8 Unemployment: Forms, Magnitude, and Policy...............93
Chapter 9 Inequality of Income and Wealth in India......................111
Chapter 10 India’s National Income.................................................129
Chapter 11 Capital Formation: Savings and Investment...................147
Chapter 12 Role of Noneconomic Factors Influencing Indian
Economy: Cultural, Social, Legal, and Political..............155
Chapter 13 Sources of Data for Studying the Indian Economy.........175

References............................................................................................191
About the Author.................................................................................205
Index..................................................................................................207
 Preface
This book is the second volume in the series of eight such volumes and
provides a summary of and highlights the changes that development
thinking has undergone over the years. The book consists of 13 chapters.
It is designed to provide a glimpse of the sparks that have ignited the
development of the Indian economy. Each chapter of the book combines
narrative, development, and analysis of the Indian economy. These chap-
ters offer a guide to and an interpretation of the growth of the Indian
economy. At the heart of the book is a series of ideas developed by econo-
mists. India began its process of development in environments marked by
sharp shortages, institutional failures, and imbalances of various kinds.
As such, the institutional environment that a country finds itself in is en-
dogenous to its state of economic development, and as a result, artificially
implanting institutions is only likely to cause severe dislocations and
adjustment costs. It is important to note that economic transformation
can be engineered even in countries like India that have a suboptimal
institutional environment and weak overall physical and human capital.
What is needed in a globalized world is a state that proactively promotes
only those sectors that are in consonance with a country’s comparative
advantage.
Successful development requires the state to correct market failures
and play a proactive, facilitating role in the economy. It also provides a
strong case for thinking about political economy writ large. Given the fact
that India adopted a deep commitment to democracy, economics needed
to work its way explicitly through the political process. What becomes
clear in this is the extent to which plans and policies reflect the pulls and
pushes of political and economic imperatives. Indeed, what is remarkable
about postindependence India was that the degree of experimentation
in combining state planning with democracy, in attempting structural
transformation, and in maintaining independence and coherence as a na-
tion state, all came about, at least at the outset, through planning. And,
certainly, the growth turnaround in the postindependence period was
substantial.
 Acknowledgments
In writing a book one draws upon the contributions of so many other
scholars. All efforts have been made to acknowledge the contribution of
the authors the book has drawn upon but separate acknowledgment of
each of them, apart from some references, is a formidable task. Detailed
textual references are given in the endnotes and bibliographical references.
I gratefully acknowledge the debt of all such authors whose theories and
views provided me with ample wisdom and enlightenment. There is little
that is original in this book, and much that is owed to the pioneering
contributions of various scholars. None of them are, however, responsible
for the views that are expressed in this book and the errors that it might
contain. I alone am responsible for errors and omissions, if any.
A special word of appreciation is due to my old friend Professor
D.P.S. Verma (retired professor of commerce, Delhi School of Econom-
ics, University of Delhi), who helped me in improving the presentation
and bringing it to its present format. Several friends, colleagues, and stu-
dents had prompted me from time to time to write a book on the Indian
economy. Several others have helped me in the actual writing of it.
The writing of any book causes a certain amount of domestic up-
heaval. My family rode out the occasional pockets of turbulence with
admirable fortitude. My younger brother Prithwi Raj Singh (Satyawati
College, University of Delhi) has provided his unstinted cooperation and
support at all stages of my academic career. In the preparation of this
book, right from the very beginning, Manish Kumar Sharma has been
a great source of strength in providing all the necessary secretarial assis-
tance, and I express my special thanks to him. There is always scope for
improvement, and the author welcomes comments, corrections, or sug-
gestions from readers, which will be gratefully acknowledged and incor-
porated in the next edition. I eagerly look forward to receiving feedback
at sksingheco71@gmail.com, for which I would be very grateful.

Shrawan Kumar Singh

New Delhi (India)
November 5, 2019
 CHAPTER 1

Indian Economy: Nature

and Structure

This chapter first explains the nature and anatomy, or structure, of the
Indian economy to provide readers with an overview and then moves
on to the concept of economic reforms to help understand the nature of
changes that accompany economic development.

Nature and Structure of the Indian economy: At the time of India’s

independence in 1947 the economy was predominantly agrarian. The
majority of the population was engaged in agriculture, and most of those
people were very poor, surviving by cropping their own small plots or
supplying labor to other farms. Landownership, land rental, and share-
cropping rights were complex, involving layers of intermediaries. The
structural economic problems inherited at independence were exacer-
bated by the costs associated with the partition of British India, which
had resulted in about 12 to 14 million refugees fleeing past each other
across the new borders between India and Pakistan. The settlement of
refugees was a considerable financial strain.1 On the morrow of indepen-
dence the following were the salient features of the Indian economy:

I. Low per capita income

II. Low productivity and excessive dependence on agriculture
III. Demographic features: high rate of growth of population and low
level of human development
IV. Continuance of poverty, unemployment, and underemployment
V. Low rate of capital formation due to low savings rate
VI. Inequality in the distribution of income and wealth
VII. Technical backwardness
2 UNDERSTANDING THE INDIAN ECONOMY – POST-REFORMS OF 1991

VIII. Insufficiency of natural resources

IX. Lack of infrastructure
X. Dualistic nature of the economy (features of a modern economy
existed alongside the traditional)
XI. Lack of entrepreneurship
XII. Market imperfections
XIII. Corruption, malpractices, and bureaucratic control
XIV. Inadequate development of economic organizations
XV. Dominance of unorganized sector

In 2017, agriculture, with its allied sectors, was the largest source of
livelihood in India. Seventy percent of the country’s rural households still
depend primarily on agriculture for their livelihood, with 82 percent of
farmers being small and marginal.2 But with time the share of agriculture
is decreasing and the share of the service sector is increasing. India’s diverse
economy encompasses traditional village farming, modern agriculture,
handicrafts, a wide range of modern industries, and a multitude of services.
Services are the major source of economic growth, accounting for more
than half of India’s output with less than one-third of its labor force. The
sector that carries out all activity through a system and follows the law of
the land is called the organized sector. The informal, or unorganized, econ-
omy is largely rural and encompasses farming, fishing, forestry, and cottage
industries. It also includes petty vendors and some small-scale mechanized
industries in both rural and urban areas. The sectors that evade most of the
laws and don’t follow the system come under the unorganized sector. Com-
pared with developed countries like United States, Japan, Germany, France,
United Kingdom, Canada which were having higher rates of both savings
and investment ranging from 20 to 28% on an average during 1960s,3 the
Indian economy has a lower level of both the investment and the savings
rate ranging from 10 to 14% on an average during the same period.4

Postindependence plans, objectives, and policy framework—­deliberate

efforts toward economic development: Since independence India has been
a mixed economy, where the public sector coexists with the private sector.
Companies that are run and financed by the government constitute the
public sector. India’s large public sectors were responsible for providing em-
ployment and revenue to the economy. India’s leaders who introduced the
 Indian Economy: Nature and Structure 3

five-year plans agreed that strong economic growth and measures to increase
incomes and consumption among the poorest groups were necessary goals
for the new nation. The planners wanted domination of the public sector in
the growth of the economy. The private sector would play a complementary
role. This thinking dominated the planning process from 1950 to 1990.
This thinking had several positive aspects as well as negative. Government
was assigned an important role in this process, and since 1951 a series of five-
year plans have guided the country’s economic development. In the period
right after independence the Indian entrepreneur was not cash rich, so the
government had to start creating big public sector enterprises. Companies
that are run and financed by private individuals constitute the private sector.
Although there was considerable growth, the long-term rates of growth were
less positive than desired. Such a rate of growth, of around 3.5 percent, was
termed the “Hindu rate of growth.”
During the early phase of economic planning, in 1950s, a large num-
ber of basic industries that produced capital equipment (machine tools,
industrial machinery, process plant equipment, construction and mining
equipment, electrical equipment, textile machinery, printing and packag-
ing machinery, etc.) and useful raw materials were set up, making the
country’s industrial structure quite strong. Social overhead capital, which
broadly includes transport facilities, irrigation systems, energy produc-
tion, educational system and organization, and health facilities, has regis-
tered promising development and created favorable conditions for growth
and also for better living. The infrastructure sector has grown in terms
of both capacity and modernization. The railways route length and road
network in 2019 constitutes one of the largest in the world. India has also
seen growth in life expectancy and literacy rates up to 2019, but educa-
tion and health services have not expanded at the desired rate.
Significant progressive changes have taken place in the banking and
financial structure of India, and as a result of these, the importance of
indigenous bankers and moneylenders has declined. With the national-
ization of 14 banks in 1969, public sector banks (PSBs) radically changed
their credit policy and made more funds available to priority sectors such
as agriculture; micro, small, and medium enterprises (MSMEs); and
transportation. The economy has progressed structurally in terms of the
growth of capital goods industries, expansion of infrastructure, perfor-
mance of the public sector, and so on. These factors, over the years, are
4 UNDERSTANDING THE INDIAN ECONOMY – POST-REFORMS OF 1991

believed to have created an element of dynamism in the country’s econ-

omy and one can now hopefully say that it would sustain development
in the future.5 India’s industrial economy is gathering momentum on the
back of improved output in the core sector industries—coal, crude oil,
refining, steel, cement, natural gas, fertilizers, and electricity.

Postindependence, the rate of growth improved in the 1980s. The

economy grew at an annual rate of 5.5 percent, or 3.3 percent on a
per capita basis. Industry grew at an annual rate of 6.6 percent and
agriculture at a rate of 3.6 percent. A high rate of investment was a
major factor in improved economic growth. Investment increased
from about 19 percent of the gross domestic product (GDP) in
the early 1970s to nearly 25 percent in the early 1980s. India,
however, required a higher rate of investment to attain higher eco-
nomic growth.

India’s primary sector, including agriculture, forestry, fishing, mining,

and quarrying, accounted for 32.8 percent of the GDP in FY 1991. In
FY 1991, the contribution to the GDP by industry, including manu-
facturing, construction, and utilities, was 27.4 percent; services, includ-
ing trade, transportation, communications, real estate and finance, and
public and private sector services, contributed 39.8 percent. The steady
increase in the proportion of services in the national economy reflects in-
creased market-determined processes, such as the spread of rural banking,
and government activities, such as defense spending.

Despite a sometimes disappointing rate of growth, the Indian

economy was transformed between 1947 and the early 1990s.
The number of kilowatt-hours of electricity generated, for ex-
ample, increased more than fiftyfold. Steel production rose from
1.5 million tons a year to 14.7 million tons a year. The country
produced space satellites and nuclear-power plants, and its sci-
entists and engineers produced an atomic explosive device. Life
expectancy increased from twenty-seven years to fifty-nine years.
Although the population increased by 485 million between 1951
and 1991, the availability of food grains per capita rose from 395
grams per day in FY 1950 to 466 grams in FY 1992.5
 Indian Economy: Nature and Structure 5

However, considerable dualism remains in the Indian economy. The

formal and informal sectors of the economy exist side by side. The infor-
mal economy is largely rural and encompasses farming, fishing, forestry,
and cottage industries. The bulk of the population is employed in the
informal economy. The formal economy consists of large units in the
modern sector, such as manufacturing and mining, major financial and
commercial businesses, and such public sector enterprises as railroads,
telecommunications, utilities, and the government itself.6

Weaknesses of the economy

The greatest disappointment of economic development is the
failure to reduce more substantially India’s widespread poverty.
Studies have suggested that income distribution changed little
between independence and the early 1990s, although it is pos-
sible that the poorer half of the population improved its posi-
tion slightly. Farmers and other rural residents make up the large
majority of India’s poor.

The bulk of the poor work, but low productivity and intermittent
employment keep incomes low.

Housing and the ancillary utilities of sewer and water systems

lag considerably behind the population’s needs. India’s cities have
large shantytowns built of scrap or readily available natural mate-
rials erected on whatever space is available, including sidewalks.
Such dwellings lack piped water, sewerage, and electricity. The
government has attempted to build housing facilities and utili-
ties for urban development, but the efforts have fallen far short
of demand.7

Economic development going well beyond growth has been the prin-
cipal agenda of each and all of the governments in India since it became
independent. Many factors, including, in particular, the fact that India
chose to follow a democratic political system and that the state was des-
tined to play a vital role in the social, political, and economic develop-
ment of the country, have been critical in shaping the state of the nation
6 UNDERSTANDING THE INDIAN ECONOMY – POST-REFORMS OF 1991

at different times. The country, unavoidably, went through phases of de-

velopment, retardation, and crises from time to time, until 1991, when a
totally new paradigm had to take over (Reddy 2016). By the early 1990s,
economic changes led to the growth in the number of Indians with sig-
nificant economic resources.8

Concept of economic reform: In any discussion on economic reforms,

there ought to be three strands: (i) Why were reforms necessary, and what
was wrong with the earlier system? (ii) What reforms have been intro-
duced? (iii) What remains to be done? The new economic policy, also
known as economic reforms, is a set of policies and administrative pro-
cedures introduced in July 1991 to bring about changes in the economic
direction of the country. Economic reforms were intended to enable In-
dian industry to develop an outward orientation, and to allow freer play
to market forces. Economic reforms placed overwhelming reliance on
private initiative and enterprise. There are essentially two aspects to eco-
nomic reform, related to internal and external economic policies. Each, in
turn, has two aspects. In internal policymaking, one aspect is debureau-
cratization and easing of controls; the other pertains to privatization of
public enterprises following the neoliberal philosophy of laissez-faire and
reliance on the market for all investment decisions, with minimum gov-
ernment intervention in the economy.
The policy has two major components: stabilization and structural re-
forms. The stabilization part has three components: (i) management of
balance of payments, (ii) control of inflation, and (iii) fiscal correction.
The structural reforms part has seven components: (i) exchange rate adjust-
ment, (ii) liberalization of imports, (iii) rationalization of tariff structure,
(iv) delicensing/removal of licensing restrictions, (v) financial sector re-
forms, (vi) disinvestments of public sector shares, and (vii) foreign direct
investment.
Though these policies and procedures have a macroeconomic thrust,
their impact on micro-level economic activities cannot be ignored. From
this point of view, the policy of economic reforms will have repercussions
on the entire gamut of economic development. Let us understand the rea-
sons behind the introduction of economic reforms in 1991. There were
several, and they are as follows:
 Indian Economy: Nature and Structure 7

I. Eliminating quantitative restrictions on exports and imports

II. Bringing down and rationalizing tariffs, eliminating export subsi-
dies, so that trade policy is neutral
III. Eliminating overvaluation in exchange rates and making the ex-
change rate market determined
IV. Reforming the public sector through disinvestments and reducing
public sector monopolies and introducing greater competition
V. Reforming the monetary policy and transiting to market-determined
interest rates, reforming the financial sector
VI. Bringing down budgetary deficits, targeting government subsidies
better, and reforming the tax structure so that indirect taxes be-
come more transparent; simultaneously, bringing down rates of
direct taxation, while broadening the base
VII. In industry, removing barriers to entry and exit
VIII. Reforming the agricultural sector by making output and input
prices market determined
IX. Targeting government expenditure on primary health, primary
education
X. Introducing social safety nets as protection against the effects of
structural adjustments
XI. Developing economic and social infrastructure

In the wake of economic reforms three terms are frequently used:

liberalization (or deregulation), privatization, globalization (LPG). Liber-
alization describes the process of removing rules imposed by government
that limit the economic freedom of individuals. Privatization means re-
moving the state and its agents from economic activities and letting these
be undertaken by private individuals. Globalization, however, has a much
broader connotation; indeed, it has become a buzzword for many differ-
ent phenomena. A comprehensive definition would define globalization
as the process of increasing both the scope and the actual incidence of
interaction between people from all parts of the globe.

Economic reform provides fillip to structural change: Due to the

balance of payments crisis seen in the wake of the Gulf War, the 1990s
saw structural changes in the Indian economy and the entry of both the
8 UNDERSTANDING THE INDIAN ECONOMY – POST-REFORMS OF 1991

private sector and the foreign sector. Greater participation was ensured,
and today, barring the nuclear sector and railway operations, all areas
are open to private and foreign investment and companies. This has also
changed the government’s approach to the development of various sec-
tors. The government has recognized the efficiency of the private sector
in execution by partnering with it on various development projects in the
infrastructure sector. This has been done through public private partner-
ship (PPP).
The trade policy too complemented the industrial policy, and the first
seven five-year plans (1951 to 1985) wanted import substitution. The
planners, however, never seriously considered providing an impetus to
exports. But, since the mid-80s, economists have been in favor of privati-
zation of nonstrategic public enterprises and fully opening the economy
to private and foreign industries. Owning to this, it was felt that there is a
need for a new economic policy, and this policy was introduced in 1991.
With this overview of changes that took place between 1947 and
1990, one would have an understanding of the progress that led to the
strengthening of the Indian economy. Apart from the growth in quantita-
tive terms, there have been significant changes in India’s economic struc-
ture since independence. The structural change has been very slow, but it
has virtually given a fillip to the traditional and stagnant economy. After
the economic reforms of 1991, the Indian economy became one of the
most promising developing economies of the world. The strategy paper of
the National Institution for Transforming India (NITI Aayog) says that
India is on the cusp of a major transformation and change has been in the
making (NITI Aayog 2018b)
The economy is moving out of the negative legacies of the past. To
meet the rising aspirations of the young population, however, India needs
to achieve and sustain a high rate of GDP growth for the next three
decades, ending 2050. There will be several milestones in this long and
arduous journey. The direct implication of ensuring rapid growth with in-
clusion is that policymaking will have to be rooted in Indian ground reali-
ties and emphasize the welfare of all in both design and implementation.

Policymaking needs a balanced approach: With this approach in view

from 2019 onward, the broad direction of macro policies in India is
 Indian Economy: Nature and Structure 9

moving toward more accommodation. The triggers are both political and
economic. Social welfare commitments—health care, pension for the un-
organized sector—will likely incur higher expenses in the coming years.
Accommodative macro policies do not necessarily imply imprudence. If
growth is weak, then countercyclical macro policies are essential (Varma
and Nandi 2019).
The more funds are diverted to subsidy, the less investment in pro-
ductivity enhancing social and physical infrastructure. Of course, there
is a need for subsidy, to help the poor break out of poverty, but it must
be sparingly used, and intelligently. India must prioritize growth and
marshal resources to that end. India must shun a political economy of
competitive populism that sees redistribution as the way out of poverty.9
Within the economic sphere, what India still needs is careful rethinking
of the balances and boundaries between public and private; centralized
and decentralized; economics and politics; and rich, poor, and middle
(Singh 2019b). “Three decades after the unveiling of economic reforms
of 1991, India’s mainstream political parties are increasingly speaking
the same language on welfare. The new political positioning in contrast
to the earlier belief was that growth is the best antidote to poverty.” The
kind of competing welfarism that was reflected during the 2019 general
election is certain to dismay sections of economic policymakers, indus-
try, and investors. “But it is also a signpost of India’s political economy
at work and a reflection of the sobering fact that irrespective of the color
and stability of the regime, the direction of reform hinges on political
will” yet, it is also true that in the postreforms period, no government
has reversed any major policy pursued by a previous regime, thus pro-
viding a measure of comfort to business and industry. “Well-meaning
policies aimed at welfare maximization or redistribution are bound to
succeed only when the state has both fiscal and implementation cap-
acity. It is all very well to say that growth will lift all boats, but ultim-
ately, politics is the art of the possible.”10

Endnotes
1. Structure of the Economy: Independence to 1979 http://country
studies.us/india/93.htm (accessed January 25, 2020)
10 UNDERSTANDING THE INDIAN ECONOMY – POST-REFORMS OF 1991

2. FAO in India: India at a glance http://www.fao.org/india/fao-in-

india/india-at-a-glance/en/ (accessed January 25, 2020)
3. Source: OECD, Annual National Accounts. http://www.oecd.org/
economy/monetary/34305161.pdf
4. Source: https://www.encyclopedia.com/international/encyclopedias-
almanacs-transcripts-and-maps/saving-and-investment-trends-1950
5. YourArticleLibrary. n.d. “4 Significant Structural Changes in India’s
Economic Structure Since Independence.” http://www.yourarticle
library.com/economics/4-significant-structural-changes-in-indias-
economic-structure-since-independence/2754, (accessed September
27, 2019).
6. India Economy Growth: A study on the economic growth of India
https://www.indianchild.com/india_economy_growth.htm (accessed
January 25, 2020)
7. Structure of the Economy: Independence to 1979 http://country
studies.us/india/93.htm (accessed January 25, 2020)
8. U.S. Library of Congress. n.d. “Structure of the Economy.” http://
countrystudies.us/india/93.htm (accessed September 27, 2019).
9. The Economic Times. February 3, 2019. “Shun a Handouts Political
Economy,” Editorial Comment. https://economictimes.indiatimes.com/
blogs/et-editorials/shun-a-handouts-political-economy/, (accessed
September 28, 2019).
10. The Indian Express. February 4, 2019. “Old, New Welfare,” E ­ ditorial
Comment.https://indianexpress.com/article/opinion/editorials/budget-
2019-mgnrega-allocation-bjp-congress-modi-old-new-welfare-5567321/,
(accessed September 28, 2019).
 Index
Aadhaar metadata, 182
Aam aadmi, 82
Absolute poverty, 82
Administrative data, 179–180
Administrative datasets, 183
Age composition, 70
Agriculture, 1, 2, 4, 16, 18–19, 30,
31, 38, 71, 73, 75, 88, 93,
95–96, 98, 124, 136, 137,
142, 143, 165
Animal spirits, 153–154
Arvind Panagariya Panel, 83
Ayushman Bharat scheme, 57
Basic income, 90
Below Poverty line (BPL), 18, 74
Bhagidari sector, 14
BPL. See Below poverty line (BPL)
Bureaucracy/civil service, 161
CAGR. See Compound annual
growth rate (CAGR)
Capital formation
national income, savings,
investment, and growth,
151–154
savings and, 147–148
savings/investment, 148–151
Capitalist mentality, 158
CCI. See Competition Commission of
India (CCI)
Central Statistical Organization
(CSO), 148
methodology, 137
Challenges, 17–18
Chinese Railways, 42
Civil aviation, 51–52
CMEPSP. See Measurement of
Economic Performance and
Social Progress (CMEPSP)
Communication, 45–48
Competition Commission of India
(CCI), 169
Competitive federalism, 179
Compound annual growth rate
(CAGR), 40
Corruption affects India’s business,
162
Country’s industrial structure, 3
CSO. See Central Statistical
Organization (CSO)
Culture industries, 157
Demographic dividend/quality of,
72–73
Demographics, 156
Dickensian world, 105
Digital serfs, 105
Direct effect, 36
Domestic workers, 104
Earned income, 114
Economic development, 2–5, 19
Economic infrastructure
civil aviation, 51–52
communication, 45–48
concept and nature of, 35
importance of, 35–36
inland waterways, 44
logistics, 44–45
ports and shipping, 43–44
power, 37–39
PSU telcos, 48–50
railways, 40–42
road, 42–43
Economic planning, 3
Economic reforms, 6–8, 9, 37, 40,
87, 100, 115, 121–122, 125,
139, 153, 162, 165
Economic slowdown, 18–19
Education, 58–60
Educational institutions, 157
208 INDEX
EEZ. See Exclusive Economic Zone
(EEZ)
Election plank, 90
Employability problem, 99
Employment indicators, 93–94
Employment opportunities, 15
Employment scenario, 95–99
Energy/power, 27–28
Ethnic diversity, 72
Exclusive Economic Zone (EEZ), 25
External sector, 103
Fast moving consumer goods
(FMCG), 41
FDI. See Foreign direct investment
(FDI)
Federal form of government, 160
Ferrous and metallic minerals, 23
FMCG. See Fast moving consumer
goods (FMCG)
Foreign direct investment (FDI), 153
Forest resources, 22–23
Forest Survey of India (FSI), 22
FSI. See Forest Survey of India (FSI)
GDP. See Gross domestic product
(GDP)
Geographical information system
(GIS), 46
GERs. See Gross enrolment ratios
(GERs)
GIS. See Geographical information
system (GIS)
GNP. See Gross national product
(GNP)
Goods and services tax (GST),
17, 177
Google Public Data Explorer, 186
Gross domestic product (GDP), 4,
8, 11, 44, 56, 60, 76, 86,
93, 130–133, 135–140, 142,
143, 147, 150, 151, 152, 187
Gross domestic savings/gross capital
formation, 149
Gross enrolment ratios (GERs), 59
Gross national income/net national
income, 141
Gross national product (GNP), 11
Growth, 151–154
GST. See Goods and services tax
(GST)
HDI. See Human Development Index
(HDI)
Health, 55–58
Health and wellness centers
(HWCs), 57
Higher education, 61–62
Hindu rate of growth, 3
Housing, 65–66
Human Development Index (HDI),
37, 55, 63–64
HWCs. See Health and wellness
centers (HWCs)
IATA. See International Air Transport
Association (IATA)
ICT. See Information and
communications technology
(ICT)
IDI. See Inclusive Development Index
(IDI)
Import exports datasets, 182
IMR. See Infant mortality rate (IMR)
Inclusive Development Index
(IDI), 135
India
EEZ of, 25
jobs policy, 102
employment problem, 94–95
industrial economy, 4
laws governing business in, 168
leaders, 2–3
literacy rate in, 71
national income, 136–144
characteristics of, 129–130
composition of, 140–144
composition/distribution of, 144
concept, of, 129
GDP measurement, 131
IDI, 135
importance of, 130–131
measurement of, 138
national income/economic
well-being, 131–136
trends in, 138–139
WEF, 135
national portal, 181
 INDEX
209

natural resources Informal employment, 12

energy and power, 27–28
forest resources, 22–23
India’s water challenges, 32–33
land resources, 22
mineral resources, 23–26
National Mineral Policy, 26–27
new energy, 28–29
renewable energy, 28–29
water resources, 29–32
policy response, 85–91
political economy in, 9, 164–166
poor, 5
poverty
causes of, 83–85
concept of, 79
estimates, 80–85
politics of, 88–91
survey of, 181
water challenges, 32–33
wealth, 118–119
weather data, 182
India State of Forest Report (ISFR), 22
Indian earth observation, 181
Indian economy
banking and financial structure of, 3
data
concept of, 175–176
importance of, 176–177
sources of, 180–185
Indian statistical system, 177–180
international data, 185–189
and media, 170–173
nature and structure of, 1–2
weaknesses of, 5–9
Indian labor market, 116
Indian Statistical Institute,
184–185
Indian statistical system, 177–180
Indian statistics, 186–189
Indirect contribution, 36
Inequality, 112–113
concept of, 111–112
extent of, 117–120
factors contributing to, 114–122
impact of, 120–122
is growing, 165
measurement of, 113–114
Infant mortality rate (IMR), 68
Informal sector, 12, 14–15
Information and communications
technology (ICT), 45
Inland water transport (IWT), 44
Inland Waterways Authority of India
(IWAI), 44
Inorganic minerals, 23
Insolvency/Bankruptcy Code, 162
Institutional data, 183
International Air Transport
Association (IATA), 51
International business legislation,
168–169
International data, 185–189
Investment, 148–154, 150–151
ISFR. See India State of Forest Report
(ISFR)
IWAI. See Inland Waterways
Authority of India (IWAI)
IWT. See Inland water transport
(IWT)
Job creation, 99–100
Job-loss growth, 106
Jobless growth, 106
Labor force participation rate (LFPR), 94
Land resources, 22
Language, 157
Legal environment, 166–170
Legal setup, importance of, 167–168
LFPR. See Labor force participation
rate (LFPR)
Liberalization/deregulation,
privatization, globalization
(LPG), 7
Life expectancy, 71
Logistics, 44–45
Lokpal and Lokayuktas Act in 2013,
162
LPG. See Liberalization/deregulation,
privatization, globalization
(LPG)
Macro policies, 8–9
Mahatma Gandhi National Rural
Employment Guarantee
Scheme (MGNREGS), 99
210 INDEX
Manpower
population, 67–72
age composition, 70
demographic dividend/quality of,
72–73
density of, 69
ethnic diversity, 72
India, literacy rate in, 71
and India’s economic
development, 73–74
life expectancy, 71
occupational structure, 70–71
rural–urban composition, 71
sex composition, 69–70
population policy, 74–77
Maternal mortality rate (MMR), 68
Measurement of Economic
Performance and Social
Progress (CMEPSP), 132
Media, 170–173
Metallic minerals, 23
Metro Rail Policy, 52
MGNREGS. See Mahatma Gandhi
National Rural Employment
Guarantee Scheme
(MGNREGS)
Micro, small, and medium enterprises
(MSMEs), 3, 18
Mineral resources, 23–26
Minerals and metals, 25
Ministry of Environment, Forest
and Climate Change
(MoEFCC), 22
Ministry of Non-Conventional
Energy Sources (MNES), 28
Mission Parivar Vikas, 75
Mixed economy, 2
MMR. See Maternal mortality rate
(MMR)
MNCs. See Multinational
corporations (MNCs)
MNES. See Ministry of Non-
Conventional Energy Sources
(MNES)
MoEFCC. See Ministry of
Environment, Forest and
Climate Change (MoEFCC)
MoSPI dataset, 181
MSMEs. See Micro, small, and
medium enterprises (MSMEs)
Multinational corporations
(MNCs), 158
National Accounts Statistics, 136
The National Commission for
Integrated Water Resources
Development (NCIWRD), 30
National Commission on Enterprises
in the Unorganized Sector
(NCEUS), 12, 15
National Council for Educational
Research and Training
(NCERT), 59
National economy, 4
National income, 151–154
National income/economic well-
being, 131–136
National Institution for Transforming
India (NITI Aayog), 8, 13,
28, 29, 32, 33, 39, 42, 49,
57, 61, 76, 77, 86, 179, 184
National Investment and Infrastructure
Fund (NIIF), 52
National Mineral Policy, 26–27
National portal, 181
National Statistical Commission
(NSC), 15
National Water Policy (NWP), 32
Natural resources, 21–22, 23, 29, 33,
48, 69
NCERT. See National Council for
Educational Research and
Training (NCERT)
NCEUS. See National Commission
on Enterprises in the
Unorganized Sector
(NCEUS)
NCIWRD. See The National
Commission for Integrated
Water Resources
Development (NCIWRD)
NER. See Net enrolment ratio (NER)
Net enrolment ratio (NER), 59
New energy, 28–29
NIIF. See National Investment and
Infrastructure Fund (NIIF)
 INDEX
211
NITI Aayog. See National Institution
for Transforming India (NITI
Aayog)
Noncontractual labor, 97, 98
Nonferrous metallic minerals, 23
Nonmetallic minerals, 23
Northern Ganga River Basin, 31
NSC. See National Statistical
Commission (NSC)
NWP. See National Water Policy
(NWP)
Occupational structure, 70–71
OGD. See Open Government Data
(OGD)
One-size-fits-all strategy, 18
Open Government Data (OGD),
182–183
Organic minerals, 23
Organized sectors, 15–16
PFI. See Population Foundation of
India (PFI)
PIL. See Public interest litigation (PIL)
PMJAY. See Pradhan Mantri Jan
Arogya Yojana (PMJAY)
Policy implications, 16–17
Policy response, 85–91
Policymaking, 8–9
Political environment, 161–162
Political forces, 159–166
Political parties, 160
Political stability, 160
Poor work, 5
Population, 67–72
Population Foundation of India
(PFI), 77
Population policy, 74–77
Population/India’s economic
development, 73–74
Ports and shipping, 43–44
Post reform of 1991, 169–170
Poverty, 5, 9, 35–36, 45, 69, 111,
112–113, 115, 116, 118,
119, 123, 126
concept of, 111–112
concept of, 79
vicious circle of, 74
Poverty alleviation, 11, 15, 63, 83, 84,
88, 126
Poverty estimates, 80–85
Poverty line, 83
Power, 37–39
PPP. See Public private partnership
(PPP)
Pradhan Mantri Jan Arogya Yojana
(PMJAY), 57, 58
Pradhan Mantri Kaushal Vikas
Yojana, 99
Pradhan Mantri Rojgar Protsahan
Yojana, 99
Pressure groups, 161
Prima facie, 117
PSBs. See Public sector banks (PSBs)
PSU. See Public sector undertaking
(PSU)
PSU telcos, 48–50
Public interest litigation (PIL),
169–170
Public opinion, 161
Public private partnership (PPP), 8
Public sector banks (PSBs), 3
Public sector undertaking (PSU), 46
Public–private partnership (PPP),
51–52
Railways, 40–42
Rangarajan Committee, 80, 82
RBI. See Reserve Bank of India (RBI)
RE. See Renewable energy (RE)
Real estate infrastructure, 64–65
Relative poverty, 82
Religion, 157
Renewable energy (RE), 28–29
Reservation/political parties,
162–164
Reserve Bank of India (RBI), 148
database, 180–181
Rhetoric, 88
Right to Education (RTE), 60
Road, 42–43
Role of opposition, 160
RTE. See Right to Education (RTE)
Rural-led strategy, 18
Rural–urban composition, 71
Rural–urban inequality, 115
212 INDEX
Sagarmala program, 44
Savings, 147–148, 151–154
Scheduled Castes (SCs), 126
Scheduled Tribes (STs), 126
SCs. See Scheduled Castes (SCs)
SEBs. See State Electricity Boards
(SEBs)
Sen’s poverty index, 81
Sex composition, 69–70
Shyama Prasad Mukherji Rurban
Mission (SPMRM), 75
Skill India, 102
Small and medium enterprises
(SMEs), 17
SMEs. See Small and medium
enterprises (SMEs)
Social development, 19
Social inequality, 166
Social infrastructure
education, 58–60
HDI, 63–64
health, 55–58
higher education, 61–62
housing, 65–66
real estate infrastructure, 64–65
teacher education, 62–66
teacher training, 62–66
way ahead, 60–61
Social organization/structure, 156–159
Social welfare commitments, 9
Special purpose vehicles (SPVs), 44
SPMRM. See Shyama Prasad
Mukherji Rurban Mission
(SPMRM)
SPVs. See Special purpose vehicles (SPVs)
Stabilization reforms, 6
Stakeholders, 173
State Electricity Boards (SEBs), 37
Structural reforms, 6
STs. See Scheduled Tribes (STs)
Survey data, 183
Swacch Bharat Abhiyaan, 74
Swatch Bharat Mission, 124, 180
Tackling inequality, 122–127
Talisman, 111
TDSAT. See Telecommunications
Dispute Settlement and
Appellate Tribunal (TDSAT)
Teacher education, 62–66
Teacher training, 62–66
Telecom Regulatory Authority of
India (TRAI), 46–47
Telecommunications Dispute
Settlement and Appellate
Tribunal (TDSAT), 47
TFR. See Total fertility rate (TFR)
Total fertility rate (TFR), 68–69
Trade policy, 8
TRAI. See Telecom Regulatory
Authority of India (TRAI)
Transactions data, 183–184
UHC. See Universal health care
(UHC)
Unemployment, 74, 130
create jobs, 101–102
employment policy, 100–101
India/gig economy, 104–108
indicators, 93–94
Unemployment rate (UR), 94
Unincorporated sector, 14
Universal health care (UHC), 57
Unorganized labor, 13–14
Unorganized sector, 12–13, 15–16
Unorganized Workers’ Social Security
Act, 17
UR. See Unemployment rate (UR)
Value-added approach, 137
Voluntary retirement scheme
(VRS), 49
VRS. See Voluntary retirement
scheme (VRS)
Water resources, 29–32
Way ahead, 60–61
WEF. See World Economic Forum
(WEF)
WHO. See World Health
Organization (WHO)
Wildlife institute, 184
World Bank, 81, 86, 185–186
World Economic Forum (WEF), 135
World Health Organization
(WHO), 186
World Trade Organization
(WTO), 168
WTO. See World Trade Organization
(WTO)
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