Even after earning the dual distinction of becoming the fifth largest economy of the world overtaking the United Kingdom (UK) and being regarded as the fastest growing economy in the world, the challenges are not over for the Indian economy. India is faced with numerous difficulties in infrastructure and investment sectors. The latest GDP growth rate stands at an impressive 13.5 per cent thanks to the contributions of the service sector. However, eight core infrastructure sectors namely, coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity showed nominal growth rate of 4.5 per cent. Moreover, the growth rate in the first quarter of the 2022-23 fiscal is well below the Reserve Bank of India’s (RBI) prediction of more than 16 per cent, which means that the economy will have to perform much better in other quarters to reach anywhere near the preferred double-digit growth. India’s economic goal is undoubtedly a difficult task considering the ongoing Russia and Ukraine crisis and the inflationary trend worldwide.
Economists argue that economic growth cannot be termed sustainable in absence of adequate contributions from all sectors. Thus, there is an urgent need to increase capital expenditure both by the government and private sectors. In the last budget, the government earmarked an impressive amount for this purpose and now it is the turn of the private sector to reciprocate in-order to remove stumbling blocks existing in the manufacturing and infrastructure sectors. The forthcoming festive season may act as a catalyst in this regard as there could be an increase in investments in anticipation of quick returns. It can be further aided by the fact that China has recorded a dismal 0.4 growth rate in the first quarter of the ongoing fiscal, which provides India the scope for new initiatives in expanding exports.
So, instead of focusing on little triumphs , we should make all efforts to ensure sustainable growth. It should be noted that soon after the introduction of the new economic policy, which opened the door for private and foreign investments in the country, the stock market showed huge rise only to flatten within months after giving birth to a major economic scam in the country. The same strategy should not be repeated to save the Indian economy. Instead, we should put stress on increasing industrial output as well as investments in infrastructural facilities. Timely completion of infrastructure projects is the prerequisite for development and should be ensured at any cost. The euphoria over achieving double-digit growth in the first quarter of the present fiscal should not make us forget that during the last three pandemic-induced years, India has registered only 3.3 per cent growth in comparison to the rate at which the economy was moving forward before the crisis. We are still far behind the pre-pandemic growth rate and achieving that rate should be our priority.
