ASSIGNMENT/ECO II

ECONOMICS II

CML4121

WRITTEN ASSIGNMENT

INDIAN ECONOMY ISSUES AND CHALLENGES

SESSION – 2019-20

B.COM 2 X

SUBMITTED TO:-

MS. DINKY DHIMAN

SUBMITTED BY:-

LOVELEEN

182099062

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INTRODUCTION

Indian economy is a mixed company being one of the developing nations. In India 3
sectors the primary sector, secondary sector and tertiary sector mainly prevail.

India was at 7th place as per nominal ranking in 2018 and is expected to shift to 5th
place during the year 2019. India's GDP in 2017 was 2600.82 billion US dollars.
There has been a rise in the Indian economy. In the Indian economy, various
investments have taken place in different sectors. In January 2019, India net
employment generation reached a 17- month high. According to a BCG report, owing
to a shift in consumer behavior and expenditure pattern the consumption may triple to
US$ 4 trillion by 2025 expected to make India 3rd largest consumer economy. India
to generate energy is focusing on non-fossil sources.

ISSUES AND CHALLENGES

Indian economy to become a developed country has been facing a lot many issues and
challenges. The issues relating to unemployment, corruption, lack of infrastructure,
poverty, etc. ISSUES:-

1. UNEMPLOYMENT – In India, the unemployment rate has risen to 7.1 %. In

2018, unemployment rose to 31 million individuals looking for jobs, according
to the Centre for Monitoring Indian Economy (CMIE). Major Causes of high
unemployment in India are The caste system, increased population growth,
slow economic growth, slow industrial growth, seasonality of agricultural
occupations, joint family system, loss of small scale cottage industries, low
rates of savings and investments, shortage of means of production, ineffective
economic planning, expansion of universities, inadequate access to irrigation,
labor immobility. The factors are not entirely exhaustive as there are more
problems which haven't been identified.

2. CORRUPTION - In the development of the Indian economy main obstacle has

been Corruption as it leads to loss of wealth and prosperity. It caused obstacles
for businesses, backwardness and poverty, brain drain and loss of talent, loss
of faith in the judicial system, loss of natural resources.

3. EDUCATIONAL STANDARDS - There is being a lot of improvement in the

education system of India still the illiteracy amongst the rural people and
women exists.

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4. INFRASTRUCTURE - It is the main tool for the development of an economy

as it provides various facilities and opportunities to the people. Poor
infrastructure has caused a lack of banking facilities, scarcity of hospitals and
doctors, lack of housing facilities, lack of educational building, lack of road
development.

5. BALANCE OF PAYMENTS DETERIORATION - Balance of payments

refers to the statement that records all the transactions taken place between
business entities of one country and the rest of the world. India experienced
deterioration in the balance of payments first time during the year 1991which
would have a disastrous consequent but was tackled by Liberalization. India is
still facing problems of deterioration of the balance of payments.

Other issues in the Indian economy are high levels of private debt; Inequality
has risen rather than decreased, large budget deficit, rigid labor laws, Poor tax
collection rates, inefficient agriculture, Business difficulties and Inequality
within regions.

CHALLENGES:-

1. The procedures of doing business need to be simplified. There should be

some relaxing on barriers to entries for the purpose of business activities.

2. To sustain growth in various sectors of the economy there needs to be

proper development of infrastructure.

3. Expanding industries fast at least by 10% per year.

4. Development of agro-processing and through diversification boosting of

agricultural growth.

5. Foreign investment in more areas.

6. Eliminating revenue deficit.

7. Improvement in Human Development Index (HDI) rank.

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CONCLUSION

The conclusion that I have drawn upon understanding the key issues and
challenges of the Indian economy is that major productive ways needs to
be implemented to fix India.
1. Unleash innovation
2. Improving relations with neighboring countries
3. Democratize education by deploying technology
4. Eliminate inequality
5. India should stop obsessing over how to become one of the world’s
greatest power

BIBLIOGRAPHY

https://www.ibef.org/economy/indian-economy-overview

https://www.intelligenteconomist.com/unemployment-in-india/\

https://www.economicshelp.org/india/problems-indian-economy/

http://www.yourarticlelibrary.com/economics/indian-economy-issues-and-
challenges/23515

https://www.investopedia.com/articles/investing/012516/3-economic-challenges-
india-faces-2016.asp

https://www.careeranna.com/articles/corruption-in-india/

https://www.investopedia.com/terms/b/bop.asp

https://mpra.ub.uni-muenchen.de/51167/3/MPRA_paper_51167.pdf

http://www.economicsdiscussion.net/balance-of-payment/problems/balance-of-
payments-problem-in-india/10877

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