INBIAN EC0N0NY

By: Piitam Piiyauaishan ()

kank 10Lh (nomlnal) / 4Lh ()
Currency lndlan 8upee (ln8) (lndlan 8upee ) 100 alse
I|sca| year Calendar year (1 Aprll 31 March)
1rade organ|zat|ons W1C SAl1A C20 and oLhers

GD $133 Lrllllon (nomlnal 10Lh 2010)
$406 Lrllllon ( 4Lh 2010)
GD growth 82 (2010 C3)
GD per cap|ta $1263 (nomlnal 138Lh 2010)
$3339 ( 129Lh 2010)
GD by sector servlces (333) lndusLry (286) agrlculLure (161) (2010)
Inf|at|on (Cl) 831 (lebruary 2011)
opu|at|on
be|ow poverty ||ne 37 (2010)
Labour force 478 mllllon (2nd 2009)
Labourforce
by occupat|on agrlculLure (32) lndusLry (14) servlces (34) (2009 esL)
Unemp|oyment 94 (200910)
Ma|n |ndustr|es LelecommunlcaLlons LexLlles chemlcals food processlng sLeel LransporLaLlon
equlpmenL cemenL mlnlng peLroleum machlnery lnformaLlon Lechnology pharmaceuLlcals
Lxports $201 bllllon (20Lh 2010)
Lxport goods peLroleum producLs preclous sLones machlnery lron and sLeel chemlcals
vehlcles apparel
Ma|n export partners uAL 1287 uS 1239 Chlna 339 (2009)
Imports $327 bllllon (11Lh 2010)
Import goods crude oll preclous sLones machlnery ferLlllzer lron and sLeel chemlcals
IDI stock $336 bllllon (200910)
ub||c debt $738 bllllon (2010) 339 of Cu
8udget def|c|t 31 of Cu (201011)
kevenues $1707 bllllon (2010 esL)
Lxpenses $2374 bllllon (2010 esL)
lndla economy Lhe Lhlrd largesL economy ln Lhe world ln Lerms of purchaslng power ls golng
Lo Louch new helghLs ln comlng years As predlcLed by Coldman Sachs Lhe Clobal lnvesLmenL
8ank by 2033 lndla would be Lhe Lhlrd largesL economy of Lhe world [usL afLer uS and Chlna lL
wlll grow Lo 60 of slze of Lhe uS economy 1hls boomlng economy of Loday has Lo pass
Lhrough many phases before lL can achleve Lhe currenL mllesLone of 9 Cu

1rade llberallzaLlon flnanclal llberallzaLlon Lax reforms and openlng up Lo forelgn lnvesLmenLs
were some of Lhe lmporLanL sLeps whlch helped lndlan economy Lo galn momenLum 1he
Lconomlc LlberallzaLlon lnLroduced by Man Mohan Slngh ln 1991 Lhen llnance MlnlsLer ln Lhe
governmenL of v narslmha 8ao proved Lo be Lhe sLepplngsLone for lndlan economlc reform
movemenLs

1o malnLaln lLs currenL sLaLus and Lo achleve Lhe LargeL Cu of 10 for flnanclal year 200607
lndlan economy has Lo overcome many challenges
Cha||enges before Ind|an economy
O opu|at|on exp|os|on 1hls monsLer ls eaLlng up lnLo Lhe success of lndla Accordlng Lo
2001 census of lndla populaLlon of lndla ln 2001 was 1028610328 growlng aL a raLe
of 211 approx Such a vasL populaLlon puLs loLs of sLress on economlc lnfrasLrucLure of
Lhe naLlon 1hus lndla has Lo conLrol lLs burgeonlng populaLlon
O overty As per records of naLlonal lannlng Commlsslon 36 of Lhe lndlan populaLlon
was llvlng 8elow overLy Llne ln 199394 1hough Lhls flgure has decreased ln recenL
Llmes buL some ma[or sLeps are needed Lo be Laken Lo ellmlnaLe poverLy from lndla
O Unemp|oyment 1he lncreaslng populaLlon ls presslng hard on economlc resources as
well as [ob opporLunlLles lndlan governmenL has sLarLed varlous schemes such as
!awahar 8ozgar ?o[na and Self LmploymenL Scheme for LducaLed unemployed ?ouLh
(SLLu?) 8uL Lhese are provlng Lo be a drop ln an ocean
O kura| urban d|v|de lL ls sald LhaL lndla lles ln vlllages even Loday when Lhere ls loLs of
Lalk golng abouL mlgraLlon Lo clLles 70 of Lhe lndlan populaLlon sLlll llves ln vlllages
1here ls a very sLark dlfference ln pace of rural and urban growLh unless Lhere lsnL a
balanced developmenL lndlan economy cannoL grow
1hese challenges can be overcome by Lhe susLalned and planned economlc reforms

1hese |nc|ude
O MalnLalnlng flscal dlsclpllne
O CrlenLaLlon of publlc expendlLure Lowards secLors ln whlch lndla ls farlng badly such as
healLh and educaLlon
O lnLroducLlon of reforms ln labour laws Lo generaLe more employmenL opporLunlLles for
Lhe growlng populaLlon of lndla
O 8eorganlzaLlon of agrlculLural secLor lnLroducLlon of new Lechnology reduclng
agrlculLures dependence on monsoon by developlng means of lrrlgaLlon
O lnLroducLlon of flnanclal reforms lncludlng prlvaLlzaLlon of some publlc secLor banks

ey Soc|a| Ind|cators


1980s

1990s |atest
opu|at|on (m||||on)
68S


84S

1090

overty Inc|dence
( pop)


44S


36

2S

1e|edens|ty (per 100
pop)


037


08

12

L|teracy


44


S2

66

Infant Morta||ty
(per 1000 b|rths)


11S


79

60


reva|ance of nIV
(m||||ons)


na

3S


6



Ind|a Lconom|c Iacts

O Cu ls $732 bllllon worlds 10Lh largesL economy ln Lerms of Cu

O Lconomlc llberallzaLlon began ln 1991 conLlnues aL a slow pacelndla ls slowly
lnLegraLlng wlLh global markeLs
O Slnce Lhe 1990s Lhe mlddle class has grown and poverLy levels have fallen
O Cu growLh has fallen only sllghLly Lo 64 (20002003) from 67 (1994
1999)
O 1arlffs are sLlll among Lhe worlds hlghesL (average 22)
O Challenges ahead reduce poverLy acceleraLe pace of reform reduce
flscal deflclL upgrade lnfrasLrucLure
O lndlas successes l1 pharma bloLech Lelcom sclence and Lechnology skllls
manufacLurlng galnlng compeLlLlveness
O 1woway uSlndla Lrade Lops $23 bllllon a year was $10 bllllon ln
1997
O lndlasCu grew aL an lmpresslve 78 durlng 20032006


Sectors
Industry and serv|ces
lndusLry accounLs for 28 of Lhe Cu and employ 14 of Lhe LoLal workforce ln absoluLe Lerms
lndla ls 12Lh ln Lhe world ln Lerms of nomlnal facLory ouLpuL 1he lndlan lndusLrlal secLor
underwenL slgnlflcanL changes as a resulL of Lhe economlc reforms of 1991 whlch removed
lmporL resLrlcLlons broughL ln forelgn compeLlLlon led Lo prlvaLlzaLlon of cerLaln publlc secLor
lndusLrles llberallzed Lhe lul reglme lmproved lnfrasLrucLure and led Lo an expanslon ln Lhe
producLlon of fasL movlng consumer goods
osLllberallzaLlon Lhe lndlan prlvaLe secLor was faced wlLh lncreaslng domesLlc as well as forelgn
compeLlLlon lncludlng Lhe LhreaL of cheaper Chlnese lmporLs lL has slnce handled Lhe change by
squeezlng cosLs revamplng managemenL and relylng on cheap labour and new Lechnology
Powever Lhls has also reduced employmenL generaLlon even by smaller manufacLurers who
earller relled on relaLlvely labourlnLenslve processes

1exLlle manufacLurlng ls Lhe second largesL source of employmenL afLer agrlculLure and accounLs
for 20 of manufacLurlng ouLpuL provldlng employmenL Lo over 20 mllllon people Ludhlana
produces 90 of woolens ln lndla and ls known as Lhe ManchesLer of lndla 1lrupur has galned
unlversal recognlLlon as Lhe leadlng source of hoslery knlLLed garmenLs casual wear and
sporLswear

lndla ls 13Lh ln servlces ouLpuL 1he servlces secLor provldes employmenL Lo 23 of Lhe work
force and ls growlng qulckly wlLh a growLh raLe of 73 ln 19912000 up from 43 ln 193180
lL has Lhe largesL share ln Lhe Cu accounLlng for 33 ln 2007 up from 13 ln 1930 lnformaLlon
Lechnology and buslness process ouLsourclng are among Lhe fasLesL growlng secLors havlng a
cumulaLlve growLh raLe of revenue 336 beLween 199798 and 200203 and conLrlbuLlng Lo
23 of Lhe counLrys LoLal exporLs ln 200708 1he growLh ln Lhe l1 secLor ls aLLrlbuLed Lo
lncreased speclallzaLlon and an avallablllLy of a large pool of low cosL hlghly skllled educaLed
and fluenL Lngllshspeaklng workers on Lhe supply slde maLched on Lhe demand slde by
lncreased demand from forelgn consumers lnLeresLed ln lndlas servlce exporLs or Lhose looklng
Lo ouLsource Lhelr operaLlons 1he share of Lhe lndlan l1 lndusLry ln Lhe counLrys Cu lncreased
from 48 ln 200306 Lo 7 ln 2008 ln 2009 seven lndlan flrms were llsLed among Lhe Lop 13
Lechnology ouLsourclng companles ln Lhe world

Mlnlng forms an lmporLanL segmenL of Lhe lndlan economy wlLh Lhe counLry produclng 79
dlfferenL mlnerals (excludlng fuel and aLomlc resources) ln 200910 lncludlng lron ore
manganese mlca bauxlLe chromlLes llmesLone asbesLos fluorlLe gypsum ochre phosphorus
and slllca sand Crganlzed reLall supermarkeLs accounLs for 24 of Lhe markeL as of 2008
8egulaLlons prevenL mosL forelgn lnvesLmenL ln reLalllng Moreover over LhlrLy regulaLlons such
as slgnboard llcenses and anLlhoardlng measures may have Lo be complled before a sLore
can open doors 1here are Laxes for movlng goods from sLaLe Lo sLaLe and even wlLhln sLaLes
1ourlsm ln lndla ls relaLlvely undeveloped buL growlng aL double dlglLs Some hosplLals woo
medlcal Lourlsm

gr|cu|ture
lndla ranks second worldwlde ln farm ouLpuL AgrlculLure and allled secLors llke foresLry logglng
and flshlng accounLed for 137 of Lhe Cu ln 200910 employed 321 of Lhe LoLal workforce
and desplLe a sLeady decllne of lLs share ln Lhe Cu ls sLlll Lhe largesL economlc secLor and a
slgnlflcanL plece of Lhe overall socloeconomlc developmenL of lndla ?lelds per unlL area of all
crops have grown slnce 1930 due Lo Lhe speclal emphasls placed on agrlculLure ln Lhe flveyear
plans and sLeady lmprovemenLs ln lrrlgaLlon Lechnology appllcaLlon of modern agrlculLural
pracLlces and provlslon of agrlculLural credlL and subsldles slnce Lhe Creen 8evoluLlon ln lndla
Powever lnLernaLlonal comparlsons reveal Lhe average yleld ln lndla ls generally 30 Lo 30 of
Lhe hlghesL average yleld ln Lhe world

lndla ls Lhe largesL producer ln Lhe world of mllk [uLe and pulses and also has Lhe worlds second
largesL caLLle populaLlon wlLh 173 mllllon anlmals ln 2008 lL ls Lhe second largesL producer of
rlce wheaL sugarcane coLLon and groundnuLs as well as Lhe second largesL frulL and vegeLable
producer accounLlng for 109 and 86 of Lhe world frulL and vegeLable producLlon
respecLlvely lndla ls also Lhe second largesL producer and Lhe largesL consumer of sllk ln Lhe
world produclng 77000 mllllon Lons ln 2003

8ank|ng and f|nance

1he lndlan money markeL ls classlfled lnLo Lhe organlzed secLor comprlslng prlvaLe publlc and
forelgn owned commerclal banks and cooperaLlve banks LogeLher known as scheduled banks
and Lhe unorganlzed secLor whlch lncludes lndlvldual or famlly owned lndlgenous bankers or
money lenders and nonbanklng flnanclal companles 1he unorganlzed secLor and mlcrocredlL
are sLlll preferred over LradlLlonal banks ln rural and suburban areas especlally for non
producLlve purposes llke ceremonles and shorL duraLlon loans

rlme MlnlsLer lndlra Candhl naLlonallzed 14 banks ln 1969 followed by slx oLhers ln 1980 and
made lL mandaLory for banks Lo provlde 40 of Lhelr neL credlL Lo prlorlLy secLors llke agrlculLure
smallscale lndusLry reLall Lrade small buslnesses eLc Lo ensure LhaL Lhe banks fulflll Lhelr soclal
and developmenLal goals Slnce Lhen Lhe number of bank branches has lncreased from 8260 ln
1969 Lo 72170 ln 2007 and Lhe populaLlon covered by a branch decreased from 63800 Lo 13000
durlng Lhe same perlod 1he LoLal bank deposlLs lncreased from lndlan 8upee 3910 crore
(uS$131 bllllon) ln 197071 Lo lndlan 8upee 3830922 crore (uS$83046 bllllon) ln 200809
uesplLe an lncrease of rural branches from 1860 or 22 of Lhe LoLal number of branches ln 1969
Lo 30390 or 42 ln 2007 only 32270 ouL of 300000 vlllages are covered by a scheduled bank

lndlas gross domesLlc savlng ln 200607 as a percenLage of Cu sLood aL a hlgh 327 More
Lhan half of personal savlngs are lnvesLed ln physlcal asseLs such as land houses caLLle and gold
1he publlc secLor banks hold over 73 of LoLal asseLs of Lhe banklng lndusLry wlLh Lhe prlvaLe
and forelgn banks holdlng 182 and 63 respecLlvely Slnce llberallzaLlon Lhe governmenL has
approved slgnlflcanL banklng reforms Whlle some of Lhese relaLe Lo naLlonallzed banks llke
encouraglng mergers reduclng governmenL lnLerference and lncreaslng proflLablllLy and
compeLlLlveness oLher reforms have opened up Lhe banklng and lnsurance secLors Lo prlvaLe
and forelgn players

Lnergy and power
lndlas oll reserves meeL 23 of Lhe counLrys domesLlc oll demand As of 2009 lndlas LoLal
proven oll reserves sLood aL 773 mllllon meLrlc Lonnes whlle gas reserves sLood aL 1074 bllllon
cublc meLres Cll and naLural gas flelds are locaLed offshore aL Mumbal Plgh krlshna Codavarl
8asln and Lhe Cauvery uelLa and onshore malnly ln Lhe sLaLes of Assam Cu[araL and 8a[asLhan
lndla ls Lhe fourLh largesL consumer of oll ln Lhe world and lmporLed $821 bllllon worLh of oll ln
Lhe flrsL Lhree quarLers of 2010 whlch had an adverse effecL on lLs currenL accounL deflclL 1he
peLroleum lndusLry ln lndla mosLly conslsLs of publlc secLor companles such as Cll and naLural
Cas CorporaLlon (CnCC) PlndusLan eLroleum CorporaLlon LlmlLed (PCL) and lndlan Cll
CorporaLlon LlmlLed (lCCL) 1here are some ma[or prlvaLe lndlan companles ln Lhe oll secLor such
as 8ellance lndusLrles LlmlLed (8lL) whlch operaLes Lhe worlds largesL oll reflnlng complex
lndla has Lhe worlds flfLh largesL wlnd power lndusLry wlLh an lnsLalled wlnd power capaclLy of
9387 MW Shown here ls a wlnd farm ln Muppandal 1amll nadu

As of 2010 lndla had an lnsLalled power generaLlon capaclLy of 164833 megawaLLs (MW) of
whlch Lhermal power conLrlbuLed 646 hydroelecLrlclLy 247 oLher sources of renewable
energy 77 and nuclear power 29 lndla meeLs mosL of lLs domesLlc energy demand Lhrough
lLs 106 bllllon Lonnes of coal reserves lndla ls also rlch ln cerLaln renewable sources of energy
wlLh slgnlflcanL fuLure poLenLlal such as solar wlnd and blofuels ([aLropha sugarcane) lndlas
huge Lhorlum reserves abouL 23 of worlds reserves are expecLed Lo fuel Lhe counLrys
amblLlous nuclear energy program ln Lhe longrun lndlas dwlndllng uranlum reserves sLagnaLed
Lhe growLh of nuclear energy ln Lhe counLry for many years Powever Lhe lndouS nuclear deal
has paved Lhe way for lndla Lo lmporL uranlum from oLher counLrles



ost||bera||zat|on per|od (s|nce 1991)
ln Lhe laLe 1970s Lhe governmenL led by Morar[l uesal eased resLrlcLlons on capaclLy expanslon
for lncumbenL companles removed prlce conLrols reduced corporaLe Laxes and promoLed Lhe
creaLlon of small scale lndusLrles ln large numbers Powever Lhe subsequenL governmenL
pollcy of lablan soclallsm hampered Lhe beneflLs of Lhe economy leadlng Lo hlgh flscal deflclLs
and a worsenlng currenL accounL 1he collapse of Lhe SovleL unlon whlch was lndlas ma[or
Lradlng parLner and Lhe Culf War whlch caused a splke ln oll prlces resulLed ln a ma[or
balanceofpaymenLs crlsls for lndla whlch found lLself faclng Lhe prospecL of defaulLlng on lLs
loans lndla asked for a $18 bllllon ballouL loan from Lhe lnLernaLlonal MoneLary lund (lMl)
whlch ln reLurn demanded reforms
ln response rlme MlnlsLer naraslmha 8ao along wlLh hls flnance mlnlsLer Manmohan Slngh
lnlLlaLed Lhe economlc llberallzaLlon of 1991 1he reforms dld away wlLh Lhe Llcence 8a[
reduced Larlffs and lnLeresL raLes and ended many publlc monopolles allowlng auLomaLlc
approval of forelgn dlrecL lnvesLmenL ln many secLors Slnce Lhen Lhe overall LhrusL of
llberallzaLlon has remalned Lhe same alLhough no governmenL has Lrled Lo Lake on powerful
lobbles such as Lrade unlons and farmers on conLenLlous lssues such as reformlng labour laws
and reduclng agrlculLural subsldles 8y Lhe Lurn of Lhe 20Lh cenLury lndla had progressed
Lowards a freemarkeL economy wlLh a subsLanLlal reducLlon ln sLaLe conLrol of Lhe economy
and lncreased flnanclal llberallzaLlon 1hls has been accompanled by lncreases ln llfe
expecLancy llLeracy raLes and food securlLy alLhough Lhe beneflclarles have largely been urban
resldenLs
Whlle Lhe credlL raLlng of lndla was hlL by lLs nuclear weapons LesLs ln 1998 lL has slnce been
ralsed Lo lnvesLmenL level ln 2003 by S and Moodys ln 2003 Coldman Sachs predlcLed LhaL
lndlas Cu ln currenL prlces would overLake lrance and lLaly by 2020 Cermany uk and 8ussla
by 2023 and !apan by 2033 maklng lL Lhe Lhlrd largesL economy of Lhe world behlnd Lhe uS
and Chlna lndla ls ofLen seen by mosL economlsLs as a rlslng economlc superpower and ls
belleved Lo play a ma[or role ln Lhe global economy ln Lhe 21sL cenLury




Income and consumpt|on
World map showlng Lhe Clnl coefflclenL a measure of lncome lnequallLy lndla has a Clnl
coefflclenL of 0368
lndlas gross naLlonal lncome per caplLa ln 2008 was $1040 lndlan offlclal esLlmaLes of Lhe
exLenL of poverLy have been sub[ecL Lo debaLe wlLh concerns belng ralsed abouL Lhe
meLhodology for Lhe deLermlnaLlon of Lhe poverLy llne As of 2003 accordlng Lo World 8ank
sLaLlsLlcs 736 of Lhe populaLlon llved on less Lhan $2 a day () whlle 416 of Lhe
populaLlon was llvlng below Lhe new lnLernaLlonal poverLy llne of $123 () per day
Powever daLa released ln 2009 by Lhe CovernmenL of lndla esLlmaLed LhaL 37 of Lhe
populaLlon llved below Lhe poverLy llne
Pouslng ls modesL Accordlng Lo 1he 1lmes of lndla a ma[orlLy of lndlans had a per caplLa space
equlvalenL Lo or less Lhan a 100 square feeL (93 m2) room for Lhelr baslc llvlng needs and one
Lhlrd of urban lndlans llved ln homes Loo cramped Lo exceed even Lhe mlnlmum requlremenLs
of a prlson cell ln Lhe uS 1he average ls 103 sq fL (96 m2) per person ln rural areas and 117 sq
fL (109 m2) per person ln urban areas
Around half of lndlan chlldren are malnourlshed 1he proporLlon of underwelghL chlldren ls
nearly double LhaL of SubSaharan Afrlca Powever lndla has noL had any ma[or famlnes slnce
lndependence A 2007 reporL by Lhe sLaLerun naLlonal Commlsslon for LnLerprlses ln Lhe
unorganlzed SecLor (nCLuS) found LhaL 63 of lndlans or 730 mllllon people llved on less Lhan
20 (uS$044) per day wlLh mosL worklng ln lnformal labour secLor wlLh no [ob or soclal
securlLy llvlng ln ab[ecL poverLy
Slnce Lhe early 1930s successlve governmenLs have lmplemenLed varlous schemes Lo allevlaLe
poverLy under cenLral plannlng LhaL have meL wlLh parLlal success All Lhese programs have
relled upon Lhe sLraLegles of Lhe lood for work program and naLlonal 8ural LmploymenL
rogram of Lhe 1980s whlch aLLempLed Lo use Lhe unemployed Lo generaLe producLlve asseLs
and bulld rural lnfrasLrucLure ln AugusL 2003 Lhe arllamenL of lndla ln response Lo Lhe
percelved fallure of economlc growLh Lo gene raLe employmenL for Lhe rural poor passed Lhe
8ural LmploymenL CuaranLee 8lll lnLo law guaranLeelng 100 days of mlnlmum wage
employmenL Lo every rural household ln all Lhe dlsLrlcLs of lndla 1he quesLlon of wheLher
economlc reforms have reduced poverLy has fuelled debaLes wlLhouL generaLlng clearcuL
answers and has also lncreased pollLlcal pressure agalnsL furLher economlc reforms especlally
Lhose lnvolvlng Lhe downslzlng of labour and cuLLlng agrlculLural subsldles 8ecenL sLaLlsLlcs ln
2010 polnL ouL LhaL Lhe number of hlgh lncome households has crossed lower lncome
households

Lmp|oyment
AgrlculLural and allled secLors accounLed for abouL 321 of Lhe LoLal workforce ln 200910
Whlle agrlculLure has faced sLagnaLlon ln growLh servlces have seen a sLeady growLh Cf Lhe
LoLal workforce 7 ls ln Lhe organlzed secLor LwoLhlrds of whlch are ln Lhe publlc secLor 1he
nSSC survey esLlmaLed LhaL ln 200403 83 of Lhe populaLlon was unemployed an lncrease
of 22 over 1993 levels wlLh unemploymenL unlformly hlgher ln urban areas and among
women CrowLh of labour sLagnaLed aL around 2 for Lhe decade beLween 19942003 abouL
Lhe same as LhaL for Lhe precedlng decade Avenues for employmenL generaLlon have been
ldenLlfled ln Lhe l1 and Lravel and Lourlsm secLors whlch have been experlenclng hlgh annual
growLh raLes of above 9
unemploymenL ln lndla ls characLerlzed by chronlc (dlsgulsed) unemploymenL CovernmenL
schemes LhaL LargeL eradlcaLlon of boLh poverLy and unemploymenL (whlch ln recenL decades
has senL mllllons of poor and unskllled people lnLo urban areas ln search of llvellhoods) aLLempL
Lo solve Lhe problem by provldlng flnanclal asslsLance for seLLlng up buslnesses sklll honlng
seLLlng up publlc secLor enLerprlses reservaLlons ln governmenLs eLc 1he decllne ln organlzed
employmenL due Lo Lhe decreased role of Lhe publlc secLor afLer llberallzaLlon has furLher
underllned Lhe need for focuslng on beLLer educaLlon and has also puL pollLlcal pressure on
furLher reforms lndlas labour regulaLlons are heavy even by developlng counLry sLandards and
analysLs have urged Lhe governmenL Lo abollsh or modlfy Lhem ln order Lo make Lhe
envlronmenL more conduclve for employmenL generaLlon 1he 11Lh flveyear plan has also
ldenLlfled Lhe need for a congenlal envlronmenL Lo be creaLed for employmenL generaLlon by
reduclng Lhe number of permlsslons and oLher bureaucraLlc clearances requlred lurLher
lnequallLles and lnadequacles ln Lhe educaLlon sysLem have been ldenLlfled as an obsLacle
prevenLlng Lhe beneflLs of lncreased employmenL opporLunlLles from reachlng all secLors of
socleLy
Chlld labour ln lndla ls a complex problem LhaL ls baslcally rooLed ln poverLy coupled wlLh a
fallure of governmenLal pollcy whlch has focused on subsldlzlng hlgher raLher Lhan elemenLary
educaLlon as a resulL beneflLlng Lhe prlvlleged raLher Lhan Lhe poorer secLlons of socleLy133
1he lndlan governmenL ls lmplemenLlng Lhe worlds largesL chlld labour ellmlnaLlon program
wlLh prlmary educaLlon LargeLed for 230 mllllon numerous nongovernmenLal and volunLary
organlzaLlons are also lnvolved Speclal lnvesLlgaLlon cells have been seL up ln sLaLes Lo enforce
exlsLlng laws bannlng Lhe employmenL of chlldren under 14 ln hazardous lndusLrles 1he
allocaLlon of Lhe CovernmenL of lndla for Lhe eradlcaLlon of chlld labour was $21 mllllon ln
2007 ubllc campalgns provlslon of meals ln school and oLher lncenLlves have proven
successful ln lncreaslng aLLendance raLes ln schools ln some sLaLes
ln 200910 remlLLances from lndlan mlgranLs overseas sLood aL 230000 crore (uS$333
bllllon) Lhe hlghesL ln Lhe world buL Lhelr share ln lul remalned low aL around 1 lndla
ranked 133Lh on Lhe Lase of uolng 8uslness lndex 2010 behlnd counLrles such as Chlna (89Lh)
aklsLan (83Lh) and nlgerla (123Lh)
A crlLlcal problem faclng lndlas economy ls Lhe sharp and growlng reglonal varlaLlons among
lndlas dlfferenL sLaLes and LerrlLorles ln Lerms of poverLy avallablllLy of lnfrasLrucLure and
socloeconomlc developmenL Slx lowlncome sLaLes 8lhar ChhaLLlsgarh !harkhand Madhya
radesh Crlssa and uLLar radesh are home Lo more Lhan one Lhlrd of lndlas populaLlon
Severe dlsparlLles exlsL among sLaLes ln Lerms of lncome llLeracy raLes and llfe expecLancy and
llvlng condlLlons
1he flveyear plans especlally ln Lhe prellberallzaLlon era aLLempLed Lo reduce reglonal
dlsparlLles by encouraglng lndusLrlal developmenL ln Lhe lnLerlor reglons and dlsLrlbuLlng
lndusLrles across sLaLes buL Lhe resulLs have noL been very encouraglng slnce Lhese measures
ln facL lncreased lnefflclency and hampered effecLlve lndusLrlal growLh AfLer llberallzaLlon Lhe
more advanced sLaLes have been beLLer placed Lo beneflL from Lhem wlLh welldeveloped
lnfrasLrucLure and an educaLed and skllled workforce whlch aLLracL Lhe manufacLurlng and
servlce secLors 1he governmenLs of backward reglons are Lrylng Lo reduce dlsparlLles by
offerlng Lax holldays and cheap land and focuslng more on secLors llke Lourlsm whlch alLhough
belng geographlcally and hlsLorlcally deLermlned can become a source of growLh and develops
fasLer Lhan oLher secLor


kLILkLNCLs
8eporL on LmploymenL unemploymenL Survey (200910) 8ureau of Labor
SLaLlsLlcs lndlan CovernmenL CcLober 8 20108eLrleved 20110117

llnance MlnlsLry of lndla

8eserve 8ank of lndlas daLabase on Lhe lndlan economy

lndla ln 8uslness Cfflclal webslLe for lnvesLmenL and 1rade ln lndla

wwwWlklpedlacom