This a tough question, that baffles definition. The march of economy must have a connection to the poverty aspect. If poor become poorer, and the rich become richer and if the statistics show that the economy is on the march, the trend is not encouraging. Progress indicated by the statistics relating to various sectors and the overall standard of living of the people need to go in tandem. Otherwise, progress becomes meaningless and gives rise to social tensions.
Overview of Indian Economy – India is the seventh largest in area and population-wise it is the second largest. The land covers an area of 3,287,240 sq. km. Nature has blessed India with everything. Big plains, coastline on either side of the country, and world-famous mountains make this an extraordinary country.
Broad understanding about the Economy
Indian economy is dynamic and expanding. The industry and agriculture sectors employ a huge workforce. With computerization and internet revolution, many work opportunities are created in new sectors. The economy is the 12th largest as per market exchange rate, estimated to be at $1,242 billion. (GDP) As for purchasing power parity, the economy takes the fourth position in the world. But poverty and disparity in the incomes is mind-boggling.
Let me illustrate this point with an example. This indicates the direction in which India is growing. Mukesh Ambani, the famous industrialist has built a 27 storied house for himself at Altamount Road, Mumbai. Its cost is about five thousand crores Indian rupees.(More than 2 billion US dollars) It is more than a Maharaja’s house, designed by Perkins and Will, eminent designer of Chicago.
Hardly 14 kilometers away, right opposite to the Santacruz International Airport, about 2 lakhs people live in slums, in sub-human conditions and this colony is in existence, almost in the same conditions, for the last six decades. Sanitation facilities in the area are horrible.
This is how democracy is working in India; this how the economy is marching ahead—rich become richer, the poor remain utterly poor.
The policies of liberalization have contributed to boost the demand and the trade volume. Since 19976, the average growth rate was 7%. India withstood the recession successfully and even during this period the growth rate was about 5.4% in 2009. Outsourcing has given a shot in the arm for the Indian economy. India has been a preferred destination for information technology products and business process outsourcing. The economy is diverse, and 66% of the population depends on agriculture for its livelihood.
Besides agriculture, the dominating sectors are pharmaceuticals, ship building, and aviation, tourism including medical tourism, biotechnology, telecommunications and retailing. Growth rates in all these sectors have increased substantially and the dramatic rise continues.
That the government debt is running at around 80% of GDP indicates that the Government spends recklessly. Making provisions for the payment of interest on debts is the single largest component of the Central Budget. Deficit reduction assumes utmost importance and new methods of fiscal disciplines will have to be worked out.
Poverty and Unemployment
The unemployment rate in 2009 was 10%. Rising inflation rate has added to the woes of the poor man. The rate was 10.7% in 2009. Economic disparities are on the increase. Over 25% of the working Indian population is living below the poverty line. Statistics apart, the situation is more pathetic than what is revealed through the Government sources. Poverty is dancing the death-dance in the remote rural interiors and tribal areas. The population growth remains unchecked due to fanatical religious and social customs and beliefs.
According to World Bank Report, India is classified as a low-income economy.
One of the major problems of this country is the unplanned urbanization. The rural youth has taken fancy to the city life and are least interested in continuing with their traditional occupation of agriculture. Significant deterioration in the quality of life in important cities like Mumbai, Bangalore and Delhi is seen. A few decades ago, they were far better places to live in. Water supply, sewage treatment and disposal, and public transport systems are already in a mess.
Forget GDP; forget all-round growth, corruption and the environment of scandals are eating the vitals of the country. The rule of law seems to have vanished and the moral fabric is torn asunder. An honest man is totally demoralized and there is deterioration in all walks of life.
Is Indian Economy on the march? It may be! But India is walking backward definitely. No doubt about it. A country that has lost discipline and public morals and doesn’t care for its millions of poor and street children cannot make progress in the real sense.