An overview of Indian economy

PANDURANGA R. NET &K-SET

Research Scholar Dept of. Studies and Research in Economics

V S K University, Ballari pandushambhavi@gmail.com

Mob-9591443384

An overview of Indian economy

1) National income 2) Budget in India3) Census in India 4) Poverty in India 5) H D I in India6) NITI ayog 7) Finance Commission in India

National income in India National income means the total amount of income accruing to a country from economic

activities in a year’s time is known as national income

the attempt to calculate national income was made by Dadabhai Naoroji in 1867-68, then the per capita of India was only 20 Rupees

the first scientific method was made by Professor VKRV Rao in 1931-32

the first official attempt was made by National income committee in 1949, which was chaired by P C Mahalanobis. According to this committee our per capita income was 225 rupees

P C Mahalanobis is father of Indian statistics and also father of Indian budget

in India national income is estimated by Central statically office (earlier it was central statistical organization ). CSO was set up in 1949

Calculation of National income

According to Simon Kuznets National income can be calculated

1) product method

2) income method

3) expenditure method, also known as consumption method

2) Budget in India

First time budget word was used in France in 1803 In India The budget was first introduced in India on 7 April, 1860 by

the East-India Company to the British Crown. Pre-independence finance minister, James Wilson presented the budget in 1860

The Union Budget of India, also referred to as the Annual financial statement in the Article 112 of the Constitution of India.

Shanmukham Chetty, first Finance Minister of India presented the budget in November 1947 without any tax proposals. However , he presented the analysis of the economic scenario of Independent India just 95 days before the budget presentation in 1948

1) Before 2001 our budget was used to present on last working day of February at evening 5 P M

2) But from 2001 onwards Yashwant Sinha's begun to present budget at 11 A M

3) Morarji Desai topped the list with 10 budget presentations followed P Chidambaram and Pranab Mukherjee. Out of 10, 2 are interim budget and 8 are full budgets. On February 29 in 1964 and 1968, he became the only finance minister to present the Union budget on his birthday

2015-16 budget highlights

2015 Union budget of India. The beginning of the budget printing began on 19 February 2015 with the traditional halwa ceremony. From 20 February until the presentation of budget about 100 government employees remained locked up in the North Block of the Secretariat Building, New Delhi, which houses the budget printing press, to maintain secrecy. The budget was presented on 28 February by Finance Minister Arun Jaitley

2) Micro Units Development and Refinance Agency Bank (or MUDRA Bank)

The bank will have a initial corpus of 20,000 crore and a credit guarantee fund of 3,000 crore.The bank will initially function as a non-banking financial company and a subsidiary of the Small Industries Development Bank of India (SIDBI). Later, it will be made into a separate company. It will also serve as a regulator for other micro-finance institutions (MFIs) and provide them refinancing services. It will provide guidelines for MFIs and give them ratings

• The bank will classify its clients into three categories and the maximum allowed loan sums will be based on the category:

• Shishu Allowed loans up to 50,000.

• Kishore Allowed loans up to 5,00,000

• Tarun Allowed loans up to 10,00,000

Game changing reforms :

• Goods and Service Tax (GST) ( is planned to implement on 1st – april -2016)

• Jan Dhan, Aadhar and Mobile (JAM) - for direct benefit transfer.

• General anti-avoidance rules (GAAR) Government defers rollout of anti-tax avoidance rules GAAR by two years. GAAR to apply prospectively from April 1, 2017

Taxation

* To abolish wealth tax* Replaces wealth tax with additional 2 per cent surcharge on super rich* Proposes to cut to 25 per cent corporate tax over next four years* Corporate tax of 30 per cent is uncompetitive

* Net gain from tax proposals seen at Rs 150.68 billion

• Amrut Mahotsav - The year 2022, 75th year of Independence Vision for “Team India” led by PM

• Accordingly, journey for fiscal deficit target of 3% will be achieved in 3 years rather than 2 years. The fiscal deficit targets are 3.9%, 3.5% and 3.0% in FY 2015-16,2016-17 & 2017-18 respectively.

• Atal Innovation Mission (AIM) to be established in NITI to provide Innovation Promotion Platform involving academicians, and drawing upon national and international experiences to foster a culture of innovation , research and development. A sum of `150 crore will be earmarked.

• (SETU) Self-Employment and Talent Utilization) to be established as Techno-financial, incubation and facilitation programme to support all aspects of start-up business. `1000 crore to be set aside as initial amount in NITI.

• Public Debt Management Agency (PDMA) bringing both external and domestic borrowings under one roof to be set up this year.

3) 2011 Census in India

Our census history goes back to 1872 when although a census was conducted, it is not regarded as a regular census as it was not conducted at the same time.

Since 1881 India has conducted decennial censuses without any interruption.

The enumeration of households took place from February 9 to 28, 2011 and the provisional results were declared towards the end of March 2011.

2011 conti……

Main motto of 2011 census is “OUR CENSUS OUR FUTURE” 2011 census is 15th census of India and 7th census after independence

With the growth rate of population slowing down to 17.64from the earlier 21.54 of 2001 census

the Commissioner & Registrar General of the Indian 2011 Census Mr. C. Chandramouli

• census survey covered all the 28 states of the country and 7 Union territories including 640 districts, 497 cities, 5767 tehsils & over 6 lakh villages.

Most Populated Metros. (as per 2011 census)

Mumbai 18,394,912

Delhi 16,349,831

Kolkata 14,035,959

Chennai 8,653,521

Bangalore 8,520,435

Top Literate States and union territory

Kerala 94.00 %

Lakshadweep 91.85 %

Mizoram 91.33 %

Goa 88.70 %

Tripura 87.22 %

Best Sex Ratio

Kerala 1084

Puducherry 1037

Tamil Nadu 996

Andhra Pradesh 993

Chhattisgarh 991

High Population states

Uttar Pradesh 199,812,341

Maharashtra 112,374,333

Bihar 104,099,452

West Bengal 91,276,115

Andhra Pradesh 84,580,777

4) Poverty in India

Poverty is a situation where the people are not able to get two square meals in a day , unable to provide education to their children, unable to have modern technologies they are poor people or this is situation of poverty

Planning commission defined poverty line in calorie standard for a typical individual in rural areas was 2400 calorie and was 2100 calorie in urban areas.

the Planning Commission of India(Tendulkar Committee) reported that 21.9% of all people in India fall below the international poverty line of US$ 1.25 per day

• As against of planning commission report on poverty, C Rangarajan submitted report, a person spending less than Rs 1,407 a month (Rs 47/day) would be considered poor in cities, as against the Tendulkar Committee's suggestion of Rs 1,000 a month (Rs 33/day). In villages, those spending less than Rs 972 a month (Rs 32/day) would be considered poor. This is much higher than Rs 816 a month (Rs 27/day) recommended by Tendulkar Committee. Report stated that india still has 29 per cent of poor people

Types of poverty

1) Absolute poverty refers to a condition where a person does not have the minimum amount of income needed to meet the minimum requirements for one or more basic living needs over an extended period of time.

2) Relative poverty is the condition in which people lack the minimum amount of income needed in order to maintain the average standard of living in the society in which they live.

5) H D I in India

The Human Development Index (HDI) is a composite statistic of life expectancy, education, and per capita income indicators, which are used to rank countries into four tiers of human development. The HDI was developed by Pakistani economist Mahbub ul Haq, is anchored in the Nobel laureate Amartya Sen’s work on human capabilities, often framed in terms of whether people are able to "be" and "do" desirable things in their life, and was published by the United Nations Development Programme

Madhya Pradesh is the first state to adopt HDI report in our country, Karnataka adopted since 1999

2014 The HDR covers 187 countries across the world and is published annually by the United Nations Development Programme (UNDP). In the current report, the top five countries ranked in terms of the HDI are Norway, Australia, Switzerland, Netherlands and the US. The bottom five in this ranking are Niger, Democratic Republic of Congo, Central African Republic, Chad and Sierra Leone.

India is ranked at 135 out of 187 as per 2014 report

6) NITI Aayog

NITI Aayog is a Government of India policy think-tank established by Prime Minister Narendra Modi after his having dissolved the Planning Commission

The Union Government of India announced formation of NITI Aayog on 1 January 2015, and the first meeting of NITI Aayog was held on 8 February 2015

The stated aim of NITI Aayog's creation is to foster involvement and participation in the economic policy-making process by state governments of India, a "bottom-up" approach in contrast to the Planning Commission's tradition of "top-down" decision-making

Present Members NITI Aayog

Chairperson: Prime Minister Narendra ModiCEO: Sindhushree Khullar IASVice Chairperson: Arvind PanagariyaEx-Officio Members: Rajnath Singh, Arun Jaitley, Suresh

Prabhu and Radha Mohan SinghSpecial Invitees: Nitin Gadkari, Smriti Zubin Irani and Thawar

Chand GehlotFull-time Members: Bibek Debroy, V. K. Saraswat and Ramesh

chandGoverning Council: All Chief Ministers and Lieutenant

Governors of States and Union Territories

7). Finance commission in India

• Finance Commission is a body set up under Article 280 of the Constitution. Its primary job is to recommend measures and methods on how revenues need to be distributed between the Centre and states

• What Duties Finance Commission has ?• The commission has to take on itself the job of addressing

the imbalances that often arise between the taxation powers and expenditure responsibilities of the centre and the states, respectively. Primarily, it has to ensure a sense of equality in public services across the states.

The first chairman of Finance Commission k c niyogi Every finance commission is appointed once in five year It has a chairman and 4 other members 14th Finance Commission chairman Former Governor of the

Reserve Bank of India, Mr. Y.V. Reddy.Duration of 14th Finance Commission from 2015 to 2020Recommendation of 14th Finance Commission an increase in

the share of states in the centre's tax revenue from the current 32 per cent to 42 per cent. This is indeed the single largest increase ever recommended by a Finance Commission

Thanking you