An Overview Of Top Five Challenges Of the Indian Economy

According to the Times of India, India’s per capita income has grown from $360 to $2100 from 1991 to the present time. The government has invested tremendously in trades and infrastructures in the past years. This investment has helped the Indian economy multiply since the 1900s. Even after the economic growth, the Indian economy still faces various challenges that need to be overcome. 

Challenges faced by the Indian economy

1) Unemployment: Despite rapid economic growth, the major problem that the Indian economy faces is unemployment. People are jobless not only in rural areas but also in urban areas. This is a problem bigger than it seems and leads to a rise in crime rates.

When people do not get opportunities, they lack enough money to fulfil their basic necessities. This develops negative thinking and criminal attitudes in them. The lack of opportunities also breaks their morale, and they lose their will to learn. They also stop investing in training which otherwise is essential for a job or greater opportunities.

2) Lack of Education due to High Costs: In India, many people remain illiterate. There are several parts of the country where females are still not given the right to get an education. Many people in urban areas and maximum rural populations, especially women, are uneducated. This happens because education is too costly, and all cannot meet education costs.

This results in lesser job opportunities because all sectors need workers who can be trained or know the working of complex machinery. Thus lack of education leads to lesser job opportunities for the people.

3) The Economic Difference between Poor and Rich: There is a vast difference in wealth between the rich and the poor. Rich are getting richer, and the poor are getting poorer. The distribution of income in India is hugely uneven, which is quite unfair and stops the country from growing.

4) Agriculture predominates the Indian economy: According to KCG’s final report, agriculture provides employment to 60% of the population of India and, in turn, forms 17% of the GDP in India. Agriculture has grown in India, and various commodities are produced in the country itself. The articles produced from agriculture undergo various operations before reaching the market like transportation, bagging, storage, etc. These operations employ people and contribute to India’s economy. 

5) Lack of Infrastructure: India lacks an efficient infrastructure. This means India lacks the basic system required to work to perfection. A perfect example of the same can be seen as a lack of irrigation facilities for the farmers. Transportation infrastructure needs to be improved. The government needs to invest in roads, railways, ports, etc. Improvement of infrastructure leads to a trade boost.

Steps to overcome these economic challenges

India’s population is growing rapidly, and overcoming challenges that hinder economic growth can be time-consuming. Some ways to overcome these challenges are mentioned below.

1. Investment in Infrastructure: Government needs to start investing in Indian infrastructure to improve the facilities needed in the country.
2. Privatisation: Privatisation leads to economic growth rapidly because it increases the income per capita. For example, Adani has taken over six airports in India. When these airports were under the Indian government, they had to take loans to pay salaries. Adani’s overtake has led to the development of infrastructure. Now he invests his money and gives the salaries to employees. This is an example of Privatisation and helps the country increase its per capita income.
3. Increase the Demands for Investment: There is an urgent need for the government to increase the demands for investment, i.e. it should make concentrated efforts to boost trade. The other countries must invest in India to increase the country’s profits. This happens when trade increases, which can be done by exporting surplus jobs to India.
4. Promoting joint ventures: India should promote joint business ventures where the government works with other people or countries to construct good infrastructure in India. For example, it was recently in the news that Dubai will invest in Jammu and Kashmir in critical sectors like tourism, handloom, etc.
5. Industrial production: India should increase its industrial production and improve its machinery. It is necessary to do so because there is a surplus of labourers in the agricultural sectors which needs to be absorbed by our industries.
6. Improving education standards: India should improve its education standards. By improving education standards, the country makes sure that people learn about the new and emerging technology. This leads to the disposal of more and better opportunities for the people to choose from and willing people get jobs in the industrial sectors. This also ensures that the labour surplus of the agricultural sector is not further increased.
7. Indigenous production of goods: India should begin consuming products produced in the country itself. This increases the per capita income of the country as export duty reduces. It also creates employment opportunities. Swadeshi is the best example of the same.
8. Taking steps to eradicate corruption: Corruption is also one of the critical challenges faced by the Indian economy. Eradication of corruption is essential to see the growth in our economy. 

Conclusion

A low level of technology leads to the production of low-level labour. This is the reason India’s growth is being hindered. Undoubtedly, India grew in various directions during the planning era. However, now it has come to a stop from where it is making very slow and underrated growth.

The massive unemployment, increasing population, lack of infrastructure, etc., defines India as an underdeveloped country. The situation calls for the Indian government to grow and overcome the shortcomings that stop India from becoming a superpower.

India should invest more in the country inside. The investment in products received from other countries should be cut down. This would lead to economic growth in the country.