Fast growing economy is the need of the hour to address many of India's socio-economic problems and to provide social safety nets. Analyse (200 Words)
Refer - The Hindu
Enrich the answer from other sources, if the question demands.
K. V. A 6 years
Pls review
IAS Parliament 6 years
Try to include about rationalizing subsidies. Keep Writing.
IAS Parliament 6 years
KEY POINTS
As in the revised new base estimates, the growth rate in 2016-17 was 8.2%; in 2018-19 it was 7%.
It is only a fast growing economy that will generate the surpluses which are necessary to address many of our socio-economic problems and to provide social safety nets.
Decline in investment rate
· For faster growth, what is critically needed is a higher investment rate.
· In current prices, the ratio of Gross Fixed Capital Formation to Gross Domestic Product has stayed low at 28.5% between 2015-16 and 2017-18.
· But for sustained growth, the ratio has to go up, and that too substantially.
· RBI Bulletin says that in 2017-18, the industry-wise distribution of projects sanctioned by banks and other institutions in 2017-18 shows that the power sector accounted for 38.2% of the total expenditure.
· Pure manufacturing had only a small share. All these point to the urgent need to accelerate investment.
Reviving investment
· The bulk of public investment comes from public sector enterprises, including the Railways.
· Public sector units can take a longer-term view than the private sector. A strong public investment programme can be a catalyst of private investment.
· In a situation such as the present one, Government of India can crowd in private investment.
· There have to be sector- or industry-wise discussions between the government and industrialists to understand the bottlenecks that each industry faces in making investment and take actions to remove them.
· Banks are under stress and the ratio of non-performing assets (NPAs) has risen. We need to resolve this issue as early as possible so that banks can get back to lending at a significant pace.
Jobs and growth
· There has been great concern about the inability of the economy to generate adequate employment.
· Employment numbers have always been somewhat worrisome because of the presence of heavy underemployment in the country.
· Demand for employment have to be effectively addressed through vocational training at local level via Local self governments.
Minimum income support
The government should move in the direction of removing some of the subsidies and schemes which are similar in nature to minimum income, consolidate them, add to them what is fiscally feasible and provide the funds directly to the poor. This will help to increase the economic growth indirectly.
Anisha Sahu 6 years
Kindly Review it.
IAS Parliament 6 years
Try to include Government schemes in favour of the arguments. Keep Writing.
