1. Key Characteristics of Indian Economy
- Mixed Economy: Blend of public (government) and private sectors.
- Developing Economy: High growth potential but with income inequality.
- Agriculture-Driven: Employs ~45% workforce but contributes ~15% to GDP.
- Service Sector Dominance: Contributes ~55% to GDP (IT, banking, tourism).
2. Major Sectors
A) Primary Sector (Agriculture & Allied)
- Green Revolution (1960s): Made India self-sufficient in food grains.
- Challenges: Low productivity, monsoon dependence, small landholdings.
- Schemes: PM-KISAN, e-NAM, Soil Health Card.
B) Secondary Sector (Industry)
- Contribution: ~25% of GDP.
- Key Industries: Textiles, automobiles, pharmaceuticals.
- Initiatives: Make in India, PLI (Production Linked Incentive).
C) Tertiary Sector (Services)
- IT & Software: India is the world’s back-office (Bangalore, Hyderabad hubs).
- Tourism: Major forex earner (e.g., Incredible India campaign).
3. Economic Planning
- NITI Aayog (2015): Replaced Planning Commission; focuses on cooperative federalism.
- Five-Year Plans: Discontinued after 12th Plan (2012-17); replaced by *3-year action agendas*.
4. Key Economic Concepts
- GDP Growth Rate: Averaged ~6-7% pre-pandemic; contracted -7.3% in FY21 (COVID-19).
- Inflation: Measured by CPI (Consumer Price Index) & WPI (Wholesale Price Index).
- Fiscal Deficit: Difference between govt. revenue and expenditure (target: ~6% of GDP).
5. Reforms & Policies
- 1991 LPG Reforms: Liberalization, Privatization, Globalization (Dr. Manmohan Singh).
- GST (2017): One Nation, One Tax; subsumed 17 indirect taxes.
- Monetary Policy: Controlled by RBI (Repo Rate, CRR, SLR).
6. Global Rankings
- 5th Largest Economy (Nominal GDP, 2023).
- 3rd Largest PPP (Purchasing Power Parity).
- Ease of Doing Business: Jumped to 63rd (2019) from 142nd (2014).
7. Challenges
- Unemployment: Urban youth unemployment at ~12% (PLFS 2023).
- NPAs: Bad loans in public sector banks.
- Informal Sector: ~80% workforce lacks social security.
8. Recent Initiatives
- Atmanirbhar Bharat: Self-reliance push (COVID-19 response).
- Digital India: UPI, RuPay, Aadhaar-linked services.