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India - Economic developments in India : achievements and challenges (Inglês)

Over the last four years since the macroeconomic crisis in 1991, the Indian economy has undergone substantial changes. Almost all areas of the economy have been opened to domestic and foreign private investment. Import licensing restrictions on intermediates and capital goods have been virtually eliminated. Tariffs have been significantly reduced and full convertibility has been established for current account transactions. In the financial sector, prudential regulations that meet international standards have been introduced; banks now have significantly more discretion in their lending decisions; financial markets have been liberalized; and entry restrictions have been eliminated. The external accounts have strengthened considerably and, although still a major obstacle to higher growth, central fiscal imbalances are lower. This report highlights a large unfinished agenda. First, all reforms, which are part of the program articulated since 1991, need to be followed through to completion. In addition, agriculture, which historically has contributed extensively to poverty reduction, requires a more focused effort. Second, an urgent and appreciable improvement in public savings - embracing reduction of the fiscal deficits of the central and state governments, and improving substantially the efficiency of public enterprises - is necessary. It is critical for restoring the capacity of the public sector to invest and for accommodating higher levels of private investment. Such levels of private investment, particularly in infrastructure and social services such as primary education, are needed to achieve and sustain rates of growth and poverty reduction comparable to higher performing countries in Asia. Third, failure to correct fiscal imbalances would implicate and ultimately undermine external sector policies. Over the last two years, the challenge has been to prevent surpluses in the capital account from causing the nominal and real exchange rates to appreciate, and thereby, from reducing export growth. Careful and cautious management of these external accounts needs to continue in the foreseeable future, whether the challenge is large capital inflows or outflows. At the same time, international experience indicates that a strong fiscal position has a central role in managing effectively the capital and current accounts of the balance of payments. Fourth, in an economy which was driven for four decades by increases in public investment, maintaining dynamic growth requires a dramatic increase in private investment in infrastructure. Recent changes in the policy framework provide ample scope for this needed private sector involvement, and private investors have expressed interest in participating in the sector.


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    India - Economic developments in India : achievements and challenges

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    gnp per capita growth rate;irrigation and water resources;private investment in infrastructure;gross fixed capital formation;access to health care;nominal interest rate;total labor force;energy consumption per capita;food aid in cereals;international real interest rate;tax on corporate income;Public Enterprise Reform;financial sector liberalization;rate of growth;balance of payment;personal income tax;population growth rate;current account deficit;public sector deficit;public sector saving;level of private;intergovernmental fiscal relation;operations and maintenance;state finance;fiscal deficit;public saving;agricultural sector performance;foreign private investment;foreign exchange transaction;Effective interest rate;structural adjustment program;capital market development;public enterprise performance;households with electricity;real exchange rate;private sector involvement;fiscal deficit target;consumer price index;burden of adjustment;total tax revenue;wages and salary;foreign investment regime;private sector bank;import of goods;gdp growth rate;reduction in tariffs;growth and development;composition of expenditure;increase in remittance;portfolio investment flow;debt service obligation;human resource development;average exchange rate;quality of bank;Merger and Acquisitions;public sector monopoly;public service responsibility;point of departure;per capita gnp;public sector investment;high import duties;gross capital formation;interest rate liberalization;corporate tax rate;power and water;tax reform process;dual exchange rate;total road length;terms of trade;social security coverage;basic social service;population per nurse;maternal mortality rate;births per woman;total fertility rate;sales tax rate;commercial dispute settlement;financial sector development;gross enrollment ratio;Capital Inflows;capital good;external account;financial market;administrative issues;income indicator;fiscal consolidation;dollar term;Tax Administration;prudential regulation;Fiscal Reform;capital expenditure;commercial bank;headcount index;lending decision;capital account;domestic debt;tax collection;private investor;fiscal imbalance;tax system;regulatory issue;transportation sector;pupil-teacher ratio;free market;Exchange Rates;public bank;primary surplus;life expectancy;fiscal adjustment;industrial sector;current expenditure;international standard;live birth;reform effort;fiscal discipline;intergovernmental transfer;interest income;state programs;state debt;regional market;Public Infrastructure;agricultural land;inadequate provision;child malnutrition;inflation rate;public expenditure;improving competition;tender process;general elections;railway infrastructure;reasonable assumption;inflation target;increase growth;modal freight;monetary restraint;Natural Resources;collect tax;financial consequence;net capital;tax receipt;debt relief;land area;expenditure growth;fiscal performance;future debt;administrative control;financial discipline;dropout rate;Public Services;cumulative effect;dependency ratio;selective intervention;external market;heavy burden;Wage Bill;educational outcome;private institution;tax share;debt forgiveness;Property tax;land law;Port Services;unmet demand;telecommunication service;income share;capacity utilization;tax law;Trade Policies;repeater rate;constant price;state expenditure;macroeconomic crisis;classroom use;noncommercial purposes;entry restriction;higher growth;central fiscal;telecommunications sector;education finance;financial issue;transport equipment;coal sector;Trade Policy;export growth;computational assistance;fixed investment;market rate;average household;fertilizer consumption;primary pupil;cereal imports;urban population;aggressive privatization;tax effort;implicit assumption;private trader;monetary policy;tax net;manufacturing sector;social indicator;tax deduction;service contract;International Trade;crude petroleum;fiscal position;dynamic growth;Competition Law;Economic Management;private saving



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