India is an emerging economy with huge investment opportunities and a large, growing middle class. However, it ranks low on human development and faces challenges like maintaining high GDP growth, reducing fiscal and current account deficits, and developing infrastructure. The government is focusing on tax and fiscal reforms while the central bank uses monetary policy tools like interest rates and reserve requirements to achieve objectives like price stability and credit flow. Financial sector reforms also aim to strengthen the banking system and support the growing services sector.

1. INDIA
PRESENTED BY - GROUP
1
DUSHYANT
SAURAV
ROOPSA
RASLEEN
SANKALP
SAGAR

2. INDIA AS AN EMERGING ECONOMY
 One of the largest emerging economy
 Huge investment opportunities
 Low wage rate
 More productive manufacturing sector
Strong Banking sector
Huge talent pool in a rapidly growing middle class
Forward growing trend in middle class
Forward growing trend in urbanization

3. HUMAN DEVELOPMENT INDEX
India ranks 136 in human development Index
Brazil 0.730
Russia 0.788
India 0.554
China 0.699
South Africa 0.629

4. MAJOR CHALLENGES IN INDIAN ECONOMY
 Sustaining and achieving annual average growth of 9-10 %
Providing investor friendly laws and tax system
Current Account Deficit
Fiscal Deficit
Developing world-class infrastructure for sustaining growth in all the
sectors of the economy
Depreciation of Currency
Political environmental barrier for FDI
Inflation
Allowing foreign investment in more areas

5. YEAR
DEVELOPING
COUNTRIES
INDIANNGDP
2012 4.7 3.2
2013 4.8 4.8
2014 5.3 6.2
2015 5.5 6.6
2016 5.7 7.1​
0
1
2
3
4
5
6
7
2012 2013 2014 2015 2016
Projected Growth
DEVELOPING COUNTRIES INDIANN GDP
Projected Growth of India GDP

8. Source-indiabudget.nic.in

9. FISCAL POLICIES
 Fiscal policy deals with the taxation and expenditure decisions of the
government
 Fiscal deficit for the current fiscal year is 4.6 % of the GDP ,
smaller than 4.9 % recorded previous year
 Government is focusing on tax reforms and targeting social
expenditures to achieve fiscal consolidation
It aimed at reducing fiscal deficit, revenue deficit & borrowings from
the RBI

10. MONETARY POLICIES
 The part of the economic policy which regulates the level of money in
the economy in order to achieve certain objectives.
 Central Bank of the country controls the monetary policy of the
country
 It aims at price stability , economic growth , employment & flow of
credit

11. CURRENT MONETARY POLICIES TOOLS
 RBI increases bank rate from 8.75% to 9% on 28th January,2014
Present cash reserve ratio is 4% continuing from 30th December 2012
 Current SLR is 23% since 11th October,2012
Repo rate has increased from 7.75% to 8% on 28th January,2014
Reserve repo rate has also increased from 6.75% to 7% on 28th
January,2014

12. EXCHANGE RATES

13. INDIA’S CURRENT ACCOUNT

14. BALANCE OF PAYMENT TRENDS IN JULY-SEPTEMBER 2013
• India’s current account deficit (CAD) narrowed sharply to US$ 5.2 billion in
Q2 of 2013-14 from US$ 21.0 billion.
• Merchandise exports increased by 11.9 per cent to US$ 81.2 billion in Q2 of
2013-14
• Merchandise imports at US$ 114.5 billion, recorded a decline of 4.8 per
cent in Q2 of 2013-14 as compared with a decline of 3.0 per cent in Q2 of
2012-13
• As a result, the merchandise trade deficit (bop basis) contracted to US$
33.3 billion in Q2 of 2013-14 from US$ 47.8 billion
SOURCE: RBI WEBSITE

15. INDIA’S EXTERNAL DEBT

16. • Currently india's total external debt is 21.7% of gdp.
• Foreign debt service ratio ( principal and interest payments on the foreign debt as a
percent of t0tal exports of goods and services) is 5.9 percent in 2012-13.
• India aiso had a sizeable cushion of international reserves totaling us $ 291 billion in
jan 2014 to draw on if there should be capital flight out of the country for any reason.

17. FREE TRADE ZONES
• Free trade zones were established by the government of india to promote export-
oriented production. This step was taken in order to increase exports and thus reduce
the current account deficit.
• Special economic zones (sez)
• Export processing zones( epz)
• Software technology parks (stp)

18. FINANCIAL SECTOR
REFORMS
• Service sector is a key driver of growth.
• India is expected to grant banking licenses to private-sector banking and
non-banking finance companies.
• Foreign banks play important role in financial innovation.
• Exports proceeds payments must be received only through banking
channels.