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    India

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    Rizwan Ali
    India has experienced significant economic growth and development since the 1950s but also faced periods of slow growth. Key points: 1) India's growth rates increased after economic reforms in 1991, with average GDP growth rising from around 3-5% before 1991 to over 6-8% after reforms. 2) Reforms led to deregulation of many industries, reduction in licensing, opening to foreign investment and trade. However, reforms were gradual rather than "big bang". 3) While poverty and human development indicators like literacy have greatly improved, challenges remain including infrastructure, rural development, and reducing disparities between states.

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    India

    Uploaded by

    Rizwan Ali
    14 views21 pages
    India has experienced significant economic growth and development since the 1950s but also faced periods of slow growth. Key points: 1) India's growth rates increased after economic reforms in 1991, with average GDP growth rising from around 3-5% before 1991 to over 6-8% after reforms. 2) Reforms led to deregulation of many industries, reduction in licensing, opening to foreign investment and trade. However, reforms were gradual rather than "big bang". 3) While poverty and human development indicators like literacy have greatly improved, challenges remain including infrastructure, rural development, and reducing disparities between states.

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    Global SOuth - India

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    India has experienced significant economic growth and development since the 1950s but also faced periods of slow growth. Key points: 1) India's growth rates increased after economic reforms in 1991, with average GDP growth rising from around 3-5% before 1991 to over 6-8% after reforms. 2) Reforms led to deregulation of many industries, reduction in licensing, opening to foreign investment and trade. However, reforms were gradual rather than "big bang". 3) While poverty and human development indicators like literacy have greatly improved, challenges remain including infrastructure, rural development, and reducing disparities between states.

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    © All Rights Reserved
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    Download as pptx, pdf, or txt
    14 views21 pages

    India

    Uploaded by

    Rizwan Ali
    India has experienced significant economic growth and development since the 1950s but also faced periods of slow growth. Key points: 1) India's growth rates increased after economic reforms in 1991, with average GDP growth rising from around 3-5% before 1991 to over 6-8% after reforms. 2) Reforms led to deregulation of many industries, reduction in licensing, opening to foreign investment and trade. However, reforms were gradual rather than "big bang". 3) While poverty and human development indicators like literacy have greatly improved, challenges remain including infrastructure, rural development, and reducing disparities between states.

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    CONTRASTS IN THE

    GLOBAL SOUTH 2

    SOUTH ASIA: INDIA


    SUGGESTED READINGS
    • Rohit Lamba and Arvind Subramanian (2020). Dynamism with Incommensurate Development: The Distinctive Indian
    Model, Journal of Economic Perspectives—Volume 34, Number 1—Winter 2020—Pages 3–30.
    • Joshi, Vijay, (2017) India's long road: the search for prosperity, Oxford UP
    • Panagariya, Arvind (2008), India: the emerging giant, Oxford UP
    • Roy, Tirthankar, (2016) ‘The British Empire and The Economic Development of India (1858-1947)’, Revista de Historia
    Económica / Journal of Iberian and Latin American Economic History, Volume 34, Issue 2
    • World Development Reports on India available online
    • Also see:
    • https://www.weforum.org/agenda/2018/12/all-of-the-world-s-top-10-cities-with-the-fastest-growing-economies-will-be-
    in-india/
    • Former IMF Chief Economic Advisor and former Reserve Bank Governor Prof Raghuram Rajan and Dr Abhijeet
    Banerjee, Nobel Prize Winner in Economics, 2019 on Indian economy
    • https://lnkd.in/ehpqVQr Lecture 1
    • Https://lnkd.in/e39Veii Lecture 2
    GEOGRAPHY AND DEMOGRAPHICS

    • Location: Surrounded by Pakistan, China, Bangladesh and Nepal

    • Population:
     1950-51 - 359 mln
     2015- 1292.71 mln

    • Number of States: 28 states; 9 Union Territories


    GROWTH RATES (IN %)
    Decades Korea India China

    1961-65 10.7 3.7 1.9


    1965-70 10.6 4.6 7.4
    1971-75 7.6 2.9 5.9
    1976-80 7.0 3.2 6.6

    1981-85 7.8 5.2 10.8

    1986-90 9.6 6.0 7.9

    1990-95 7.8 5.1 12.3

    1996-00 3.6 5.9 8.6


    2001-05 4.5 7.0 9.6
    2005-10 4.2 8.6 11.2
    2010-15 3.7 6.8 8.3
    2015-19 2.7 6.6 6.7
    GDP GROWTH RATES OF INDIA, CHINA AND KOREA
    (5 YEAR AVERAGE)
    OVERVIEW (1950-90)

    • India’s development strategy in


    pre-reform period was focused
    on: economic growth; self
    reliance; social justice.
    • India followed inward looking
    heavy industry based
    industrialization approach
    • Heavy government intervention
    and highly regulated economy
    • Less emphasis on primary
    education than higher education
    • Inadequate infrastructure
    INDIA ‘S GDP GROWTH RATES - 1950-
    90
    COMPOSITION OF GDP: 1950-1990
    (AVERAGES IN PER CENT)
    Decades Agriculture Industry Services
    1950-60 53.6 11.6 34.4
    1961-70 45.6 15.0 39.1
    1971-80 40.8 16.7 42.2
    1981-90 35.0 18.7 46.3
    REASONS FOR SLOW GROWTH
    DURING 1950-90
    • Heavy government intervention and highly regulated economy
    • Very large bureaucracy
    • Large public sector
    • High cost economy- lack of competition, inefficiencies
    • More focus on redistribution rather than growth

    9
    ECONOMIC REFORMS STARTED IN 1991

    • Objective of Economic Reforms

    • Acceleration of economic growth


    • Reduction in poverty
    • Increase productivity
    • Reduce Inefficiencies

    10
    LEARNING BY DOING

    • Devaluation of Indian Rupee- 18%


    • Wide ranging reforms in
    – industry - abolition of industrial licensing
    – finance - interest rates deregulated, controls removed
    – external - import licensing removed except few goods; export controls in 1991 on 439
    goods
    – foreign investment- automatic approval of FDI
    – fiscal sector

    11
    CHARACTERISTICS OF INDIAN
    REFORMS
    • Gradual as against big-bang approach
    • Reforms ‘Irreversible’
    • Reforms with a ‘human face’
    “The government will follow economic policies that will promote growth
    with social justice and lead to greater self-reliance. We have no use for
    jobless growth; nor for growth that leaves untouched large sections of the
    people.” – Union Budget 1996-97
    • Inclusive Growth
    • Sectors like agriculture and labour market not touched
    • Banks’ ownership remains unchanged

    12
    OVERALL

    • Reforms started in July 1991


    • Triggering factors: a combination of external and internal factors
    • Wide ranging reforms in most sectors
    • Outcomes: sharp increase in growth rates, reduction in poverty, increase in
    per capita income
    • India’s rise in global economy
    • Lot still remains undone - Human development; agriculture; Infrastructure

    13
    HUMAN DEVELOPMENT
    • Literacy Rate (per cent)
     18.3 – 1951- (Males- 27.2; Females- 8.9)
     52.2 - 1991 – (Males- 64.1; Females – 39.3)
     69.1- 2014 – (Males- 75.7; Females- 62.0)
     74- 2018- (Males- 82; Females- 66)

    • Crude Birth Rate (per thousand)


     39.9 - 1951
     29.5 - 1991
     20.4 – 2016
     18- 2018

    • Infant Mortality Rate (per thousand live births)


     146 – 1951
     80 - 1991
     34- 2016
     28- 2019
    14
    HUMAN DEVELOPMENT CONTD.

    • Life Expectancy at Birth (years)


     32.1 – 1951
     59.4 – 1991
     69- 2017

    • Death Rate
     27.4 – 1951
     9.8 – 1991
     6.4 - 2016
    POVERTY IN INDIA
    • Head count poverty –

     1973 -74 - 54.9 per cent


     2004-05 - 27.5 per cent
     2011- 21.9 per cent

    • Density of poverty - number of poor per unit of land area was 91.8 per sq km in 2004-05
     39.4 people per sq km in Rajasthan to 392 per sq km in Bihar

     https://ophi.org.uk/multidimensional-poverty-index/

    16
    AREA UNDER FOREST COVER (IN SQ
    KM)
    710000
    708273
    708000
    706000
    704000
    702000 701495

    700000
    697898
    698000
    696000
    694000
    692000
    2013 2015 2017
    • “The telephones that existed were not dependable- it was rare to get a
    number on the first attempt. The employees of the telephone department
    were arrogant and corrupt. If the line went down, it could take months to
    fix unless one bribed the lensman. When an MP complained in
    Parliament of these breakdowns, C.M.Stephens, Mrs Gandhi’s
    communications minister, replied that telephones were a luxury, not a
    right, and that anyone who was dissatisfied could return the telephone,
    because there was an eight year waiting list for this ‘broken down
    product’.”

    *** G. Das (2000), p. 208.


    MOBILE CELLULAR SUBSCRIPTIONS
    (PER 100 PEOPLE)
    160.0

    140.0 136.0
    127.5 130.8
    119.5 120.7
    120.0
    104.3
    100.0
    87.3
    80.0

    60.0

    40.0

    20.0

    0.0
    India Ghana Switzerland UK China NZ US
    INDIAN MOBILE REVOLUTION?

    Rashmi Umesh Arora India Unbound Session II UOA (2009) 20


    INDIAN ECONOMIC MIRACLE?

    • Miracle –Yes, it has taken place


    • From 3.5 per cent economic growth rate to 8-9 per cent growth rate
    • Huge change in mindset
    • Increase in productivity
    • Much still remains undone and a long way to go (concern areas: poor
    infrastructure; agriculture; rural areas; poor human development- health, water
    supply; still high poverty; large regional disparities particularly two northern
    states Uttar Pradesh and Bihar; growth of labour intensive industries)

    21

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