The worrying part of Indian economy is not the economy itself but the components which actually drive the economy. The economic survey 2018-19 advocates that in order to achieve US$5 trillion economy by 2024-25, India needs to sustain a real GDP growth of 8%, and that is possible only if the income determination components works hand- in- hand. The consumption, investment, savings and exports are working in an integral way to contribute to over all GDP. Let’s understand how, the game starts from consumption which creates demand, the demand forces the producers to produce by investing the saved money, this investment had ripples in it and causing multiple ripples i.e, for the sake of production the labor is hired, which means employment opportunity is created in the economy and when this labor got salary they will further add to demand and saving. For the time being let us ignore exports, all this works in a circular motion and brings stability in the economy.
The caution to be followed is that all works proportionally and if one got missed the balance got disturbed and brought serious consequences. The India economy at this hour is in the worrying state, where nominal GDP growth is at a 15-year low, unemployment is at a 45- year high, household consumption is at a four decade low and there is much more in distress.
The so called investment is shrinking, our manufacturing sector from the slowdown in leather industries to automobiles to textiles and a lot much worth worrying here. Still we are brooding of our improvements in ease of doing business index, this improvement is one thing but tell me who will come to invest in India when the so called established sectors are facing a slowdown and are on the verge of shutting down itself. For every economic activity what an investor needs the most is the stability, tell me the level of stability of any indicator in India, be it socio- economic, political or institutional. What we are gaining is the distrust of the public in the system.
When it comes to inflation we target it at the band of 4% and then fiscal deficit is reached at 3.4%. Is it not just a prima facie? where is the demand from consumer side, where is the viability of banking sector, what if the inflation you have targeted but there is no one to demand because no job, no salary, no demand.
So its an urge to the government to please drive your interest from the so called social propaganda and focus on the economy and that to towards job creation because if this moment you ignore this it will definitely turns to be a havoc.
The solution to this regard is stability via integrity and makes one sector responsible towards another so that things go hand- in- hand. This stability is restored only by gaining public trust, because if the public lose trust then it will take decades to break the vicious cycle of distrust.
Stabilize the banking, police and judiciary so that the public feels safe in keeping their money and feel secure. Then it comes to pumping of money in the market via
investment so that opportunities are created and incentives are finally met out. We all are aspiring for the same India of which present government have shown us the dream but being the part of democracy it is our responsibility to point out what is wrong. We all trust in the system and want this system to sustain this trust.