Dear Aspirants, The upcoming important exams are NABARD Grade-A and Grade-B, in which there is a section of Economic and Social Issues. So, for the same, it becomes really important to have an in-depth knowledge of the various important topics given in the syllabus. To help you with this our experts today are providing you with all the necessary information related to the mentioned field which will help you to fetch some good marks.
The topics we are covering in this post are Chapter- 01 A Brief on India and Chapter- 02 Growth and Development (About Indian Economy Growth Rate and Statistics). These notes would be very useful, so we request you to read it before you appear for the exam.
A Brief on India
India, a South Asian nation, is the seventh-largest country by area, the second-most populous country with over 1.33 billion people, and the most populous democracy in the world. India boasts of an immensely rich cultural heritage including numerous languages, traditions, and people. The country holds its uniqueness in its diversity and hence has adapted itself to international changes with poise and comfort. While the economy has welcomed international companies to invest in it with open arms since liberalization in the 1990s, Indians have been prudent and pro-active in adopting global approach and skills. Indian villagers proudly take up farming, advanced agriculture, and unique handicrafts as their profession on one hand while modern industries and professional services sectors are coming up in a big way on the other.
Thus, the country is attracting many global majors for strategic investments owing to the presence of vast range of industries, investment avenues, and a supportive government. Huge population, mostly comprising the youth, is a strong driver for demand and an ample source of manpower.
Location: India lies to the north of the equator in Southern Asia
Neighbouring Countries: Pakistan and Afghanistan share political borders with India on the West while Bangladesh and Myanmar stand adjacent on the Eastern borders. The northern boundary comprises the Sinkiang province of China, Tibet, Nepal, and Bhutan. Sri Lanka is another neighbouring country which is separated by a narrow channel of sea formed by the Palk Strait and the Gulf of Mannar.
Capital: New Delhi
Coastline: 7,517 km, including the mainland, the coastlines of Andaman and Nicobar Islands in the Bay of Bengal and Lakshadweep Islands in the Arabian Sea.
Climate: Southern India majorly enjoys tropical climate but northern India experiences temperatures from sub-zero degrees to 50 degrees Celsius. Winters embrace northern India during December to February while springs blossom in March and April. Monsoons arrive in June and stay till September, followed by autumn in October and November.
Area: India measures 3,214 km from north to south and 2,933 km from east to west with a total area of 3,287,263 sq km.
Natural Resources: Coal (fourth-largest reserves in the world), iron ore, manganese, mica, bauxite, rare earth elements, titanium ore, chromite, natural gas, diamonds, petroleum, limestone, arable land.
Land: 2,973,190 sq km
Water: 314,070 sq km
Political System and Government: The world’s largest democracy implemented its Constitution in 1950 that provided for a parliamentary system of Government with a bicameral parliament and three independent branches: the executive, the legislature and the judiciary. The country has a federal structure with elected governments in States.
Administrative Divisions: 29 States and 7 Union Territories
Constitution: The Constitution of India came into force on 26th January 1950
Executive Branch: The President of India is the Head of State, while the Prime Minister is the Head of the government and runs the office with the support of the Council of Ministers who forms the Cabinet.
Legislative Branch: The Federal Legislature comprises of the Lok Sabha (House of the People) and the Rajya Sabha (Council of States) forming both the Houses of the Parliament.
Judicial Branch: The Supreme Court of India is the apex body of the Indian legal system, followed by other High Courts and subordinate Courts.
Chief of State: President, Mr. Ram Nath Kovind (since 25th July 2017)
Head of Government: Prime Minister, Mr. Narendra Modi (since 26th May 2014)
Languages: Hindi, English and at least 16 other official languages
Literacy: Total population: 74.04 per cent (provisional data-2011 census)
Male: 82.14 percent
Female: 65.46 percent
Suffrage: 18 years of age; universal
Life expectancy: 66.9 years (men), 69.9 years (women) (2015 – WHO 2016 Report)
India’s GDP is estimated to have increased by 7.2 percent in 2017-18 and 7 percent in 2018-19. Gross Value Added (GVA) Composition by Sector (2017-18 2nd Advance Estimate)
Services: 53.9 percent
Industry: 29.1 percent
Agriculture: 17.1 percent
Forex Reserves: US$ 405.64 billion in the week up to March 15, 2019.
Gross Fixed Capital Formation (GFCF) at current prices: Gross Fixed Capital Formation (GFCF) at current prices is estimated to be Rs 40.61 trillion (US$ 587.09 billion) between Apr-Dec 2019.
Value of Exports: India’s exports stood at US$ 483.92 billion in 2018-19 (up to February 2019.
Export Partners: US, Germany, UAE, China, Japan, Thailand, Indonesia, and the European Union. India is also tapping newer markets in Africa and Latin America.
Currency (code): Indian rupee (INR)
Exchange Rates: Indian rupees per US dollar – 1 USD = 69.1713 INR (March 29, 2019)
Fiscal Year: 01st April to 31st March
Cumulative FDI Equity Inflows: US$ 409.15 billion (April 2000 to December 2018)
Share of Top Investing Countries FDI Equity Inflows: Mauritius (32 per cent), Singapore (19 per cent), Japan (7 per cent), UK (6 per cent), Netherlands (6 per cent), USA (6 per cent), Germany (3 per cent), Cyprus (2 per cent), France (2 per cent), UAE (1 per cent)
Major Sectors Attracting Highest FDI Equity Inflows: Services Sector (17 per cent), Computer Software and Hardware (9 per cent), Telecommunications (8 per cent), Construction Development (6 per cent), Trading (5 per cent), Automobiles (5 per cent), Drugs and Pharmaceuticals (4 per cent), Chemicals (4 per cent), Construction Activities (4 per cent), Power (3 per cent)
Transportation in India
Airports: Airports Authority of India (AAI) manages 129 airports in the country, which includes 23 international airports and 20 civil enclaves at defence airfields.
International Airports: Ahmedabad, Amritsar, Bengaluru, Chennai, Goa, Guwahati, Hyderabad, Kochi, Kolkata, Mumbai, New Delhi, Thiruvananthapuram, Port Blair, Srinagar, Jaipur, Nagpur, Calicut.
Railways: The Indian Railways network is spread over 108,706 km, with 12,617 passenger and 7,421 freight trains each day from 7,172 stations plying 23 million travellers and 3 million tonnes (MT) of freight daily.
Roadways: India’s road network of 4.87 million km is the second largest in the world. With the number of vehicles growing at an average annual pace of 10.16 percent, Indian roads carry about 65 percent of freight and 85 percent of passenger traffic.
Waterways: 14,500 km
Major Ports of Entry: Chennai, Ennore, Haldia, Jawaharlal Nehru Port Trust (JNPT), Kolkata, Deen Dayal, Kochi, Mormugao, Mumbai, New Mangalore, Paradip, Tuticorin, and Vishakhapatnam.
Growth and Development
(About Indian Economy Growth Rate & Statistics)
The two words ‘growth’ and ‘development’ were often used interchangeably in economic discussion. As soon as ‘development economics’ emerged as a distinct field of study after the World War II, it ‘had the appearance of being a bastard child of growth economics’ and, in fact, this child did not differ from what could be expected from a genuine ‘son of growth economics’. But, technically speaking, they are not the same.
Economic growth is defined in positive terms. It is measured by the sustained increase in real, national or per capita income of a nation over time. Economic growth is usually measured in terms of an increase in real GNP or GDP over time or an increase in income per head over time. Growth is desirable as it enables a society to consume more goods and services.
That is why growth is considered to be the basis of advancing real living standards or human welfare. At the same time, it is also true that growth does not necessarily lead to an increase in human welfare. Economic development is more fundamental than economic growth.
India has emerged as the fastest growing major economy in the world and is expected to be one of the top three economic powers of the world over the next 10-15 years, backed by its strong democracy and partnerships.
India’s GDP is estimated to have increased by 7.2 percent in 2017-18 and 7 percent in 2018-19. India has retained its position as the third largest startup base in the world with over 4,750 technology start-ups.
India’s labour force is expected to touch 160-170 million by 2020, based on the rate of population growth, increased labour force participation, and higher education enrolment, among other factors, according to a study by ASSOCHAM and Thought Arbitrage Research Institute.
India’s foreign exchange reserves were US$ 405.64 billion in the week up to March 15, 2019, according to data from the RBI.
With the improvement in the economic scenario, there have been various investments in various sectors of the economy. The M&A activity in India reached record US$ 129.4 billion in 2018 while private equity (PE) and venture capital (VC) investments reached US$ 20.5 billion. Some of the important recent developments in the Indian economy are as follows:
During 2018-19 (up to February 2019), merchandise exports from India have increased 8.85 percent year-on-year to US$ 298.47 billion, while services exports have grown 8.54 percent year-on-year to US$ 185.51 billion.
Nikkei India Manufacturing Purchasing Managers’ Index (PMI) reached a 14-month high in February 2019 and stood at 54.3.
Net direct tax collection for 2018-19 had crossed Rs 10 trillion (US$ 144.57 billion) by March 16, 2019, while goods and services tax (GST) collection stood at Rs 10.70 trillion (US$ 154.69 billion) as of February 2019.
Proceeds through Initial Public Offers (IPO) in India reached US$ 5.5 billion in 2018 and US$ 0.9 billion in Q1 2018-19.
India’s Foreign Direct Investment (FDI) equity inflows reached US$ 409.15 billion between April 2000 and December 2018, with maximum contribution from services, computer software, and hardware, telecommunications, construction, trading, and automobiles.
India’s Index of Industrial Production (IIP) rose 4.4 percent year-on-year in 2018-19 (up to January 2019).
Consumer Price Index (CPI) inflation stood at 2.57 percent in February 2019.
Net employment generation in the country reached a 17-month high in January 2019.
The interim Union Budget for 2019-20 was announced by Mr. Piyush Goyal, Union Minister for Finance, Corporate Affairs, Railways and Coal, Government of India, in Parliament on February 01, 2019. It focuses on supporting the needy farmers, economically less privileged, workers in the unorganized sector and salaried employees while continuing the Government of India’s push towards better physical and social infrastructure.
Total expenditure for 2019-20 is budgeted at Rs 2,784,200 crore (US$ 391.53 billion), an increase of 13.30 percent from 2018-19 (revised estimates).
Numerous foreign companies are setting up their facilities in India on account of various government initiatives like Make in India and Digital India. Mr. Narendra Modi, Prime Minister of India, has launched the Make in India initiative with an aim to boost the manufacturing sector of Indian economy, to increase the purchasing power of an average Indian consumer, which would further boost demand, and hence spur development, in addition to benefiting investors. The Government of India, under the Make in India initiative, is trying to give a boost to the contribution made by the manufacturing sector and aims to take it up to 25 percent of the GDP from the current 17 percent. Besides, the Government has also come up with the Digital India initiative, which focuses on three core components: the creation of digital infrastructure, delivering services digitally and to increase digital literacy.
Some of the recent initiatives and developments were undertaken by the government are listed below:
In February 2019, the Government of India approved the National Policy on Software Products – 2019, to develop the country as a software hub.
The National Mineral Policy 2019, National Electronics Policy 2019 and Faster Adoption and Manufacturing of (Hybrid) and Electric Vehicles (FAME II) have also been approved by the Government of India in 2019.
Village electrification in India was completed in April 2018. Universal household electrification is expected to be achieved by March 2019 end.
The Government of India released the maiden Agriculture Export Policy, 2018 which seeks to double agricultural exports from the country to US$ 60 billion by 2022.
Around 1.29 million houses have been constructed up to December 24, 2018, under Government of India’s housing scheme named Pradhan Mantri Awas Yojana (Urban).
Prime Minister’s Employment Generation Programme (PMEGP) will be continued with an outlay of Rs 5,500 crore (US$ 755.36 million) for three years from 2017-18 to 2019-20, according to the Cabinet Committee on Economic Affairs (CCEA).
India’s gross domestic product (GDP) is expected to reach US$ 6 trillion by Financial Year 2027 and achieve upper-middle income status on the back of digitisation, globalization, favourable demographics, and reforms.
India’s revenue receipts are estimated to touch Rs 28-30 trillion (US$ 385-412 billion) by 2019, owing to Government of India’s measures to strengthen infrastructure and reforms like demonetization and Goods and Services Tax (GST).
India is also focusing on renewable sources to generate energy. It is planning to achieve 40 percent of its energy from non-fossil sources by 2030 which is currently 30 percent and also have plans to increase its renewable energy capacity from to 175 GW by 2022.
India is expected to be the third largest consumer economy as its consumption may triple to US$ 4 trillion by 2025, owing to shift in consumer behaviour and expenditure pattern, according to a Boston Consulting Group (BCG) report; and is estimated to surpass USA to become the second largest economy in terms of purchasing power parity (PPP) by the year 2040, according to a report by PricewaterhouseCoopers.
Exchange Rate Used: 1 United States Dollar equals to 69.46 Indian Rupee (as on 11th June 2019)