Indias Economy and Infrastructure :: India Economy

Indias Economy and InfrastructureOVERVIEWIndia is rich in inbred resources and hands and has made significant stinting progress since attaining independence in 1947. Indias economy encompasses traditional village farming, forestry, fishing, modern agriculture, handicrafts, a wide operate of modern industries, and a multitude of support services. Economy transformed from to begin with agriculture, forestry, fishing, and textile manufacturing in 1947 to major heavy industry, transportation, and telecommunications industries by late 1970s. rudimentary government planning in 1950 through late 1970s free way to economic reforms and much private- empyrean initiatives in 1980s and 1990s. A innovative industrial base has been created and a large pool of skilled manpower has emerged. Nevertheless, 67% of Indias labor force (nearly 400 million) works in agriculture, which contributes 30% of the countrys GDP. Production, trade, and investing reforms since 1991 have provided new opportu nities for Indian businesspersons and an estimated 300 million eye class consumers. New Delhi has avoided debt rescheduling, attracted foreign investment, and revived confidence in Indias economic prospects since 1991. Many of the countrys fundamentals - including savings evaluate (26% of GDP) and reserves (now about $24 billion) - are healthy. Inflation eased to 7% in 1997, and interest rates dropped to between 10% and 13%. Even so, the Indian Government involve to restore the early momentum of reform, especially by continuing reductions in the extensive remaining government regulations. Moreover, economic policy changes have not yet significantly increased jobs or reduced the risk that multinational financial strains will reemerge within the next few years. Nearly 40% of the Indian population remains too poor to afford an commensurate diet. Indias exports, currency, and foreign institutional investment were affected by the East Asian crisis in late 1997 and early 1998, but ca pital account controls, a low ratio of short-term debt to reserves, and enhanced supervision of the financial sector helped insulate it from near term balance-of-payments problems. Export growth, has been slipping in 1996-97, averaging lonesome(prenominal) about 4% to 5%a large drop from the more than 20% increases it was experiencing over the prior three yearsmainly because of the twilight in Asian currencies relative to the rupee. Energy, telecommunications, and transportation shortages and the legacy of inefficient factories encumber industrial growth, which expanded only 6.7% in 1997down from more than 11% in 1996. Growth of the agricultural sector is still fairly dense rebounding to only 5.7% in 1997 from a fall of 0.1% in 1996. Agricultural investment has slowed, while costly subsidies on fertilizer, food distribution, and rural electricity remain.