In the past three months - April to June, India’s revenue earning has increased only by 1.36 per cent which is the lowest this decade. In the month of June, infrastructure sector has grown only about 0.2 percent. Demand for fertilizers and machineries have decreased. There is no encouraging news for automobile sector. As per reports, about 10 lakh workers are going to be retrenched soon from this sector. Barring one, all telecom service providers are in the red. Freight traffic in railways is on the decline. There is virtually no sign of increase in rural income. Unemployment rate is the highest in the last four and a half decades. In terms of GDP growth, we have slipped down one step in the global list. In short, all available parameters are predicting hard days for the Indian economy in the very near future.
Many may disagree but the government of the day should not be blamed singularly for such a situation. Such a condition was not created overnight. It is the result of wrong policies being pursued for years, After independence for more than four decades, the Indian economy was virtually caged by mixed economy, where government interferences were high and red tape was the main cause for its lacklustre growth. Then we heralded new economic policy to allow the market to dominate the economy in the nineties. But we never went for reforms wholeheartedly. As a result, today Indian economy is at a crossroads. No one is sure which way the economy will take take in the future. This is why no new investments are coming. As a result, creation of assets and employment are hampered extensively. Educated youths are uncertain about their future and children are growing up in an environment of uncertainty.
Actually, we have never seen Indian economy in its totality. In the name of improving the health of the economy we took cosmetic measures. For example, the main strength of India’s economy is its agriculture sector but it was never given proper attention. As a matter of fact even after the successful green revolution, we never tried to carry on the experiment in other parts of the country. For improving Indian agriculture the need was modern technology and proper irrigation system. But no effort has been made to provide proper irrigation system to farmers. The same can be said about industry, we never allowed our industries to go along with the times and needs of the people. In this sector, we were always busy in playing the catch-up game. Thus, after the arrival of information technology, our industries have become redundant and out of date. For example Hindustan Machine Tolls (HMT) once had the lion’s share in watch market. But it lost its hegemony in the market when watches with quartz technology arrived and the government owned organisation showed no inclination to modernise itself.
So the need of the hour is draw a strategy to revive the health of Indian economy, instead of indulging in blame game. Government expenses should be reduced, no populist measures should be taken. Through strict financial discipline and by strengthening the core sectors of our economy, India can turn back. But does India have the will power to face this challenge?
