Brij Bhardwaj
newsagency12@gmail.com
The Indian economy will face challenges in days to come. These challenges have come about because of wars in West Asia and Europe which have led to a sharp rise in the price of crude oil and fertilizers. Another factor which may pose a challenge is the forecast that the country may be heading for the driest monsoon of the decade in the coming months.
Any single factor would be difficult to tackle and when combined these pose a serious challenge to our growth prospects. India, which has been recording the highest rate of growth among major economies of the world for many years, will have a drop in the coming years. In addition, there will be the pressure of inflation on account of the hike in prices of petroleum products. All this combined will make the management of the economy difficult.
The factors in our favour are a large reserve of foreign currency and gold with the Reserve Bank of India, large consumer market, and the ability to find new markets for our goods in different parts of the world. The result is that India has been able to keep the prices of petroleum products at a minimum level.
There is a more serious challenge in meeting the demand of fertilizers whose prices have also risen. At present, the same is being supplied to farmers at a highly subsidised price. A large quantity has to be imported as local production is not enough. The Government has not raised the price of fertilizers for a long time. In case it continues to be sold at the same rate, the subsidy on it will nearly double, putting a heavy burden on the State. A hike in the price of fertilizers could create unrest among farmers and may also lead to a rise in the price of food items. This problem requires planning to reduce the demand for fertilizers by finding alternative crops to grow.
Finding jobs for the growing number of unemployed youth will be another challenge, as new avenues are not opening up because local investment as well as foreign investment is not taking place. For this, the reform process will have to be given a fresh look. It has to be realised that foreign investors are not finding India as an attractive market because of frequent changes in rules and regulations. There is also a need for better coordination between the Centre and States as there are a large number of problems relating to setting up new units related to State Governments and local bodies.
A uniform set of rules and regulations will also help. To bring more foreign investment it is necessary to avoid frequent changes in regulations governing foreign companies coming to set up production units here.
In all, we can say the coming time offers challenges but also opportunities. The extent to which we are able to use them will be a test for us.There is no denying the fact that India has not emerged as a major manufacturing hub except in a few sectors. There has been more stress on importing components and assembling them. This has to change. The fact that we have a large young population which could be employed after proper education and training.
There is a huge gap between the demand for skills required which could be employed and what our system is turning out. We have the advantage of a democratic system and a stable Government, So in the next few years with changes in systems we can turn the present challenges into opportunities. With our skills and resources we not only have to find a place among the large economies of the world but also raise the per capita income and reduce inequalities.
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