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Presented by: Amaan Javed Ashish Mishra Hrishikesh Patel Mahesh Mohana Nivedita Sumit Soni
Introduction
India grow by 10% Least Vulnerable country. India is exposed to US by 4 main channels: 1.Export- 15% goods and 70% services. 2.Financial intermediation Overseas borrowing, low debt to GDP ratio, high risk high return. 3.Capital flows - Robust net capital inflows
Growth Analysis: 1.Asian miracle 2.East Asian slow down Structural Economic reforms: Indias growth Growth accounting framework: 1.Capital 2.Labor 3.Raw material. Indias growth has two sides: Macroeconomic strategy and policies Inference - East Asian Miracle
Political Challenges
Developing the financial sector Foreign trade and investment Economies of scale and competition Growth and governance the political challenge
India has made substantial reforms to its financial sector since 1991 including deregulating interest rates, liberalizing capital inflows and strengthening the regulatory bodies.
The economic gains can accrue through several channels: Trade increases the efficiency with which resources are deployed across countries through exploitation of comparative advantages.
Indias recent economic growth acceleration has been spearheaded by private companies
SWOT Analysis..
Strengths:
Huge pool of labour force High percentage of cultivable land Diversified nature of the economy Huge English speaking population, availability of skilled manpower Stable economy, does not get affected by external changes. Extensive higher education system, third largest reservoir
Weaknesses
Very high percentage of workforce involved in agriculture which contributes only 23% of GDP Around a quarter of a population below the poverty line High unemployment rate Stark inequality in prevailing socio economic conditions Poor infrastructural facilities Low productivity Huge population leading to scarcity of resources
Opportunities
Scope for entry of private firms in various sectors for business Inflow of Foreign Direct Investment is likely to increase in many sectors Huge foreign exchange earning prospect in IT and ITES sector Investment in R&D, engineering design. Huge domestic market: Opportunity for MNCs for sales Huge natural gas deposits found in India, natural gas as a fuel has tremendous opportunities Vast forest area and diverse wildlife
Threats
Global economy recession/slowdown High fiscal deficit Threat of government intervention in some states Volatility in crude oil prices across the world Growing Import bill Population explosion, rate of growth of pobulation still high Agriculture excessively dependent on monsoons
Conclusion
India has emerged as a strong economy. Global exposure GDP is growing. Contribution of agriculture is less. Indian economy is overheated. FDI is rising
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