Indian Economic System

By Radhika Gohel

What is ?

Main types of economy

Macro economics

Features of Indian Economy

1. India as An Underdeveloped Country

2. India as a Developing Country

India as An Underdeveloped Country

1) Low per capita income:o At the time of independence in early 1950so Colonial ruleo After independence govt.’s roleo Still underdevelopedo Though per capita income increases over the

yearso In 2008 GNP per capita was $ 2,960 & in 2013

$ 3,944.30

Cont.

2) Inequitable distribution of Income:o Income of small section much larger o Income of large section much smaller

3) High incidence of Poverty:o Natural outcome of inequalitieso It was discovered in 6th Five Year Plan widespread

problem 50.7% rural area 40.3% in urbano Poverty in 2009-10 was 29.8% & in 2011-12 it was 21.9%

(below poverty line)

Cont.

oA 2013 UN report stated that a third of the worlds poorest people live in India.

o India is on track to cut poverty by half by 2015 in 1990 it was 51%.

4) Predominance of agriculture:oOccupational distribution of population in India

not at all good.o In 1951 70% of population dependent oVery small portion to GDP in 2008-09 17%

Cont.

5) Rapid Population Growth:oGrowing rateo In 2001 it was 1,029,000,000 (1,029 millions)

which was 4,39,000,000 (439 millions) in 1961.o Increase rate is 2.14 % per annum todayo Today

6) Unemployment:oNow-a-days educated unemploymento Problem of urban unemployment has 2 forms:

Cont.

i. Industrial unemployment

ii. Unending demand for white collar jobs

7) Technological Backwardness

8) Lack of Entrepreneurs

India as A developing Country

• Still India is an underdeveloped country but this is not an adequate description.

• India’s economy has suffered…

• After independence…

Two facets

1) Quantitative– National Income Trend

• Rise in NNP

• Rise in per Capita Income

Cont.

2) Structural changes– Significant changes in sectoral distribution of

domestic product– Slow changes in employment structure– Growth of basic capital goods industries– Progress in the banking & financial sector

Guidelines for Assignment-1

• Use single side printed papers only

• Group wise 1 submission only

• Make it perfect neither much longer nor very short

• Make it more creative rather in detail/depth by using charts, tables & more use of graphical presentation with current data

• Must contain at least 15 pages otherwise rejected