Our economy grew fastest in the world, know what kind of change has come in the Indian economy?

Akhilesh Jha

world market The rising prices of crude oil in India and the volatility of that market have always negatively affected the Indian economy. Be it in the form of inflation or in the form of fiscal and trade deficit. These negative aspects further lead to the weakness of growth rate, interest rates and Indian currency. But, for the first time after the Russia-Ukraine war, the Indian economy not only maintained its pace, but also brought a new edge to it, not being affected by the turmoil of the crude oil market.

economic strength

Morgan Stanley Research published a report last week, in which attention has been drawn to this unexpected achievement of the Indian economy. There is also an indication in the same report that the Indian economy has got rid of the practice of coming under the grip of America’s economic recession to some extent. These two important points are not only indicators of the growing power of the Indian market, but also underline India’s diplomatic activism and its strong efforts to give direction according to Indian economic interests.

• Corporate tax has come down by about ten percentage points in the last decade and at 25% effective tax rate it is able to compete with major economies in Asia. Attractive tax rates help in increasing foreign investment.
• The pace at which development is taking place in every sector related to infrastructure has not only encouraged the market but has also increased its productivity and profit opportunities in it. The length of National Highways in India has doubled in the last 9 years. In the same period, electrification of railways has more than sevenfold and production of non-conventional energy has increased almost fourfold.

Morgan Stanley Research estimates that if India’s infrastructure development continues at this pace, very soon the logistics cost, which currently accounts for 14-15% of GDP, will come down to around 8%. This is the same level in which an economy emerges from developing and stands in the category of developed.

• Digital transactions are fast leaving behind cash in the Indian market. It is not only increasing transparency in the economy but also making it dynamic.
• Digital transaction relative to GDP was just 4.4% in 2015-16, which has increased to 76.01% in the year 2022-23. A major reason for this change is the financial inclusion policies of the Government of India, which prepared every section of the society and every corner of the country mentally and skillfully for this change.
• Another very important aspect of the achievements of the Indian economy in the last nine years is Direct Benefit Transfer (DBT).
• Be it the payment of MNREGA, old age pension, Kisan-Samman-Nidhi or scholarship, the benefits were directly transferred to the beneficiary’s bank or post office account.
• In the last nine years, direct benefit transfers worth about 29.4 trillion reached the accounts of the beneficiaries. In 2020-21, the number of such beneficiaries had reached about ten crores.
• Portals like e-Shram and Shram-Suvidha have been created to create employment opportunities as per the need of the market and to create an effective bridge between the market and labor, on which about three crore people have registered and more than half of them are women. Are.
• The increasing number of people contributing to the Employees’ Provident Fund indicates that employment opportunities are increasing in the organized sector. In 2022-23, the number of such employees had increased to 11.50 crore, which was only 8.5 crore by 2020-21.

One thing that is clear from these changes taking place in the Indian economy is that now the unorganized sector is shrinking and the organized sector is expanding. This is also being proved continuously by the fact that India is the second fastest growing economy in the world. The estimates made by Morgan Stanley Research on the Indian economy are also confirmed by the data of the National Statistical Organization on 31 May. India’s GDP to grow at 7.2% in 2022-23, the highest rate among major economies of the world. India also met its fiscal deficit target of 6.4%.

cheetah not elephant

Morgan Stanley Research has shown the rejuvenation of the Indian economy in the last nine years and its future prospects through very appropriate graphics in its report. It depicts a giant elephant transforming into a cheetah and taking long leaps. We can fully expect that with the continuation of the current economic policies and its favorable diplomatic efforts, India will not only live up to the basic parameters of the economy and the expectations of its people from its public welfare schemes, but also the preferred target of investors and industries. will form.

(The writer is an officer of the Indian Civil Accounts Service and is currently working in the Ministry of Rural Development and Panchayati Raj)