Indian Economy at a Crossroads

No one seems to have any clue about what is ailing the Indian economy. Various economists have suggested various remedies. But no remedies seem to be enough to cure Indian economy which is devoid of any demand at present. The government has offered few stimulants; especially in manufacturing and real estate. Yet the economy is showing no signs of a turnaround. It is not right to say that money is not available in the market. The problem is no one is interested in investing money in the Indian market. Clearly, Indian economy has never witnessed such a scenario. Economists are busy trying to find an answer. So, what ails the Indian economy? The answer is simple. Ever since independence, the economy was not used to create wealth in the country. Whatever the earnings of the nation were, a major portion was disbursed in sops. Thus the basic rule of strengthening the economy was ignored. For example, to make India self-sufficient in food grains the government decided to use high yielding seeds and modern technology in the sixties. The plan was a grand success. It totally transformed the economies of Punjab and Haryana. Till today, we proudly call it the Green Revolution. But even after achieving such a massive success, what prevented the government from implementing the same in other parts of the country? Recently, National Crime Records Bureau (NCRB) has released a report which shows that in 2016 alone 11, 379 farmers committed suicide to avoid the debt trap. All these lives could be saved if the government took proper measures to improve farm productivity and the conditions of the farmers in the country. Agriculture is the backbone of Indian economy as maximum number of people are engaged in it. It is the primary sector of the economy. But even after the Green Revolution showed us the way, we didn’t do anything to further consolidate the gains. Today we are paying the price of neglecting agriculture. Rural India is suffering. For the people living in rural areas, today it’s a struggle for survival. So, when almost 80 per cent of the populace is in no position to make a purchase, where does the government expect demand to be created? Coming to the manufacturing sector now. During the second five-year plan, India put stress on building industries. Many industries were established during this period in public sector. But once the industries started functioning, we simply forgot to upgrade them with modern technology. As a result, today all the industrial townships are waiting to turn into ghost towns. Utter neglect towards agriculture and manufacturing in favour of service sector has made us completely dependent on service sector which does not create any permanent assets. It only creates a new class of people who earn a lot without having any job security. In a capitalist economy, the service sector operates on hire and fire principle. So even those who are earning handsomely now are not in a position to invest as they fear for their future. They want to keep as much money possible in cash to tide over bad days. Quite clearly, Indian economy is at a crossroads now. It is time now for us to decide whether we will go all out to create permanent assets or simply try to please people by offering sops. The future of the Indian economy will totally depend on the decision we take. It’s a make or break situation for the Indian economy.