Source – The Indian Express Syllabus – GS 3 – Indian Economy and issues relating to planning, mobilization, of resources, growth, development, and employment. Synopsis – Revised estimates of GDP are released. It would impact the growth prediction and levels of the future National Income. Introduction Last week all major financial publications were released i.e.… Continue reading Impacts and importance of GDP revised estimates
Synopsis- Expenditure side of National Income is showing signs of stress. The government should try to revive the consumption side to return to the growth path. Introduction The first advance estimates of GDP growth for FY21 is more optimistic than the projections provided by many institutions, global and domestic. However, the figures still have a substantial chance of uncertainty as the source… Continue reading Reviving consumption demand for economic growth
News: National Statistical Office(NSO), Ministry of Statistics and Programme Implementation(MoSPI) has released the First Advance Estimates (FAE) for 2020-21. Facts: What are the First Advance Estimates(FAE)? For any financial year, the MoSPI provides regular estimates of GDP. The first such instance is through the FAE. The FAE for any particular financial year is typically presented… Continue reading GDP likely to contract by 7.7% in 2020-21, says Govt.
Source: The Indian Express News: The current account surplus moderated to $15.5 billion (2.4% of GDP) in the quarter ended September of 2020-21 from $19.2 billion (3.8% of GDP) in the first quarter this fiscal.The current account saw a deficit of $7.6 billion(1.1%) in the year-ago quarter. Facts: Why has current account surplus narrowed? The narrowing of… Continue reading Current account surplus moderates to $15.5 bn in Q2
Context: It is important that, only if the Indian economy grows at 8% in 2021-22 we will be able to compensate for the decline in 2020-21. What needs to be done to make Indian economy to grow @ 8%? Accommodative Monetary policy: A reduction in interest rate through changes in policy rate, providing liquidity through… Continue reading Economic Growth
What are the issues facing Indian Economy? COVID pandemic has pulled down the global economy and India’s economy is one of the worst affected among them. In the first quarter of the financial year (April-June), India’s economy had contracted by an unprecedented 23.9%. Whereas in the second quarter, after a bit improvement, economy contracted by… Continue reading Why Indian Economy is slowing down?
Context- The higher GDP growth rate of the economy actually masks the decline in the unorganized sector. What in the news- The second quarter GDP contracted at a slower pace of 7.5 per cent compared to a massive 23.9 per cent in the first quarter of the current fiscal. The economy’s performance between July and… Continue reading Overestimate GDP growth data
Context: A recovery led by profits, at the expense of wages, has implications for demand, inequality and policy. GDP is typically reported in two ways: The sectoral, production side (agriculture, manufacturing, services) and the functional, expenditure side (consumption, investment, net exports). Third way: On the income side, GDP is calculated as the sum of profits, wages and indirect… Continue reading Economic recovery
Context- The Q-2 sharp recovery is very tactical because of pent-up demand, because of lockdown and the Data used for quarterly growth rates are weak and questionable. What in the news- The second quarter GDP contracted at a slower pace of 7.5 percent compared to a massive 23.9 percent in the first quarter of the… Continue reading GDP recovery- questionable data
Context: The pandemic has delivered a “scissor cut” to the government finances. What is the current scenario? Economic output and government revenues are shrinking. The government has to spend more to safeguard lives and livelihoods. Widening deficit. Most of state’s revenue come from center which changes their debt servicing ability for the worse. What are… Continue reading Present State of economy