Is Indian economy in danger?
By vinslounge
@vinslounge (1295)
India
May 19, 2012 4:09am CST
The continuing depreciation of the indian money is definitely a cause of concern for India and the Indians. The rupee value is deteriorating every day and in spite of the best efforts by the Reserve Bank of India, the slide is still continuing. There are fears that it may shoot up inflation leading to further problems like increase in the price of food and other basic living needs. Already people are affected due to increase in the cost of living. Are these things a prediction that an alarming effort is necessary to put the economy back on track. I am not an economist but my feeling is that:
India is basically an Agricultural country. But nowadays, more agricultural lands are being converted into residential plots and the agriculture is slowly dying in my country.
Manufacturing is the back bone of any developing country. But the tax on imports in India is very high and that is one of the main reasons that many Small and medium companies are not able to make a big impact in the market and this ultimately paves way for the big players and foreign brands to take over the economy. In my opinion, this is not at all a good sign for any developing country.
4 responses
@suni51 (3429)
• India
19 May 12
What I feel is that present depreciation of rupee is due to Euro-zone effects which would last for some more time as long as Europe does not come out of the grip of its present economic crisis. Reserve bank can hold the situation up to a certain extent and after that it may only boomerang on itself.
There is no doubt that problem is getting worse as inflation is rising by the hour but the main reasons reason behind are our bad policies, careless bureaucracy and worst politicians. They are selling out our country for their self interests. making bad policies for the sake of creating their own vote-banks.
The politicians are doing all out efforts to suppress whatever efforts social workers are trying to bring back system on the track.
@topffer (42156)
• France
19 May 12
Hi Suni51
,
Deflation can be worst than inflation during an economic crisis, because there is a threat of recession, and it is what happens in Europe now. I don't think that there is a unique solution : India did not followed the IMF recommendations and did not opened its markets in the 90's, but had a good growth. The problems with PayPal in India that I have followed here show that India has still some reticence to be opened to the world, but it is difficult to conclude if it is a good thing or not. But indeed, like you said, the crisis in developed countries -- and not only in Europe : it is a global crisis -- affects economy in your country.
,
Deflation can be worst than inflation during an economic crisis, because there is a threat of recession, and it is what happens in Europe now. I don't think that there is a unique solution : India did not followed the IMF recommendations and did not opened its markets in the 90's, but had a good growth. The problems with PayPal in India that I have followed here show that India has still some reticence to be opened to the world, but it is difficult to conclude if it is a good thing or not. But indeed, like you said, the crisis in developed countries -- and not only in Europe : it is a global crisis -- affects economy in your country.@suni51 (3429)
• India
19 May 12
Hello topffer- I agree here on the point that is universal, the crisis but this was already there in US for quite some time but we had learned to encounter it. Now this Euro zone problem is some thing new for us besides our own policies are making things worst for us and our leaders and officials concerned, although they know how to tackle these, but are too slow to do any thing in time bound manner. (wink)
1 person likes this
@wongchoiyee (7413)
• Malaysia
19 May 12
India needs investment from USA, Malaysia did, and we are looking fine now. Peace.
@preethaanju (3000)
• India
19 May 12
Indian economy has always been in danger. This is according to me a banana republic which has no control over its finances. With so much of scams how do you think the government will get its accounts right??. All these statistical figures are mere political ploy to silence the people and the opposition. We will need another 50 years to catch up with China.
@beachdune (907)
• India
19 May 12
What you say is right . But I think you put this discusion under the wrong topic . What does Indian economy got to do with the topic named "mylot . com" . You should have placed this discussion under a more suitable topic . Anyway , yes , the Indian currency is losing its value because because of major economic depression in European and American countries rather than the Indian counterpart . This is directly quoted towards the Indian economy being controlled by many major MNCs which actually take the major part of their profits to foreign countries .
It has been quoted at one place that in India , most MNCs in the consumer product array overprice their products and the excessive profits go to foreign countries .
For example a 200ml of coca cola or pepsi costs only 80 paise to produce but its sold in the market for RS.10 . That is obviously day light robbery . Excluding the transport costs , taxes and other miscellaneous cots , the company profits anywhere between Rs4-5 for every bottle of 200ml coke sold everyday .
Think about millions of bottle sold every day all over India . Also consider many other companies like hindustan lever , colgate , pepsodent , head and shoulders , and almost every company that produces electronic goods like sony , samsung , lg ... etc etc
So the indian economy is quiet dependant on foreign economies indirectly though .
So Indians need to stop buying products from foreign makers but buy things from Indians makers and I think that will make a difference .
