This document summarizes inflation trends in India from 1949-2014. It breaks the period down into phases and provides details on inflation rates, causes, and measures taken for each phase. The key phases discussed are 1949-1960, 1960-1970, 1970-1980, 1980-1990, 1990-2000, and 2000-2014. Inflation fluctuated significantly over this time period, ranging from -12.8% to 25.2%, and was influenced by factors like devaluations, wars, droughts, oil price shocks, and economic reforms. Periods of high inflation often coincided with supply shocks in food and fuel. The government implemented various fiscal and monetary policies to control inflation.
QE has become an integral part of monetary policy in a number of countries over the last ten years. Essentially it has been part of a strategy of cheap money brought in by central banks as a policy response the 2007-08 Global Financial Crisis amid fears of a return to deflationary depression experienced in the 1930s. Economic historians will surely debate the role of Quantitative Easing (QE) in staving off a depression for many years to come.
Contemporary issues and Challenges in Global Economic Environment - Indian perspective: Globalization and
its Advocacy, Globalization and its Impact on India, Fair Globalization and the Need for Policy Framework,
Globalization in Reverse Gear-The Threatened Re-emergence of Protectionism. Euro zone Crisis and its impact
on India, Issues in Brexit, World recession, inflationary trends, impact of fluctuating prices of crude oil, gold
etc.
This document discusses inflation in Bangladesh over several chapters:
1. It provides background on inflation, defining it as a sustained increase in general price levels. The main causes are seen as demand-pull (too much money chasing too few goods) and cost-push (increased costs passed on to consumers).
2. Inflation in Bangladesh has recently increased, prompting the central bank to tighten monetary policy. However, inflation is also driven by non-economic factors like profiteering and lack of price monitoring.
3. Charts show Bangladesh's inflation rate averaged 6.65% from 1994-2016, reaching a high of 16% in 2011 and low of -0.03% in 1996,
The document discusses monetary policy and its objectives and tools. The objectives of monetary policy are to ensure economic stability, achieve price stability by controlling inflation and deflation, and promote economic growth. The key tools of monetary policy are quantitative measures like open market operations, cash reserve ratio, and discount rate. Qualitative measures include credit rationing, changing lending margins, moral suasion, and direct controls. Monetary policy uses various tools to contract the money supply and credit to control inflation or expand the money supply and credit to control recession.
The document discusses globalization and the international economy. It describes how globalization has occurred in waves due to decreases in trade barriers and transportation costs. More recently, developing countries have increased manufacturing trade and companies have outsourced production overseas. Several countries' levels of exports and imports as a percentage of GDP are provided as a measure of openness. The advantages of globalization are greater specialization and increased competition. However, some common misconceptions are that trade is zero-sum and import barriers create jobs.
This document outlines China's historical economic growth and challenges to its current growth model. It discusses China shifting from increases in physical and human capital between 1952-1978 to participation of total factor productivity growth after 1978. Key reforms in the 1980s expanded the non-state sector and increased agricultural incentives. China has become the world's second largest economy and largest exporter but faces potential slowing growth as it reaches middle income levels and must transition its growth model to become more sustainable and consumption driven.
Introduction of Globalization, Trends in Globalization, What Are the Benefits of Globalization, Benefits of Globalization and Challenges of Globalization and its effects,
1) The document discusses drivers of startup performance and obtaining venture capital funding, citing work history, social networks, timing, partnerships, and firm strategy as key factors.
2) It also examines what makes the MIT innovation system successful, noting competition, flexibility, commitment to research, and enthusiasm for collaboration.
3) Finally, it hypothesizes drivers of performance for less developed countries, including location in supply chains, access to funds and technology, culture, risk preferences, and network ties.
QE has become an integral part of monetary policy in a number of countries over the last ten years. Essentially it has been part of a strategy of cheap money brought in by central banks as a policy response the 2007-08 Global Financial Crisis amid fears of a return to deflationary depression experienced in the 1930s. Economic historians will surely debate the role of Quantitative Easing (QE) in staving off a depression for many years to come.
Contemporary issues and Challenges in Global Economic Environment - Indian perspective: Globalization and
its Advocacy, Globalization and its Impact on India, Fair Globalization and the Need for Policy Framework,
Globalization in Reverse Gear-The Threatened Re-emergence of Protectionism. Euro zone Crisis and its impact
on India, Issues in Brexit, World recession, inflationary trends, impact of fluctuating prices of crude oil, gold
etc.
This document discusses inflation in Bangladesh over several chapters:
1. It provides background on inflation, defining it as a sustained increase in general price levels. The main causes are seen as demand-pull (too much money chasing too few goods) and cost-push (increased costs passed on to consumers).
2. Inflation in Bangladesh has recently increased, prompting the central bank to tighten monetary policy. However, inflation is also driven by non-economic factors like profiteering and lack of price monitoring.
3. Charts show Bangladesh's inflation rate averaged 6.65% from 1994-2016, reaching a high of 16% in 2011 and low of -0.03% in 1996,
The document discusses monetary policy and its objectives and tools. The objectives of monetary policy are to ensure economic stability, achieve price stability by controlling inflation and deflation, and promote economic growth. The key tools of monetary policy are quantitative measures like open market operations, cash reserve ratio, and discount rate. Qualitative measures include credit rationing, changing lending margins, moral suasion, and direct controls. Monetary policy uses various tools to contract the money supply and credit to control inflation or expand the money supply and credit to control recession.
The document discusses globalization and the international economy. It describes how globalization has occurred in waves due to decreases in trade barriers and transportation costs. More recently, developing countries have increased manufacturing trade and companies have outsourced production overseas. Several countries' levels of exports and imports as a percentage of GDP are provided as a measure of openness. The advantages of globalization are greater specialization and increased competition. However, some common misconceptions are that trade is zero-sum and import barriers create jobs.
This document outlines China's historical economic growth and challenges to its current growth model. It discusses China shifting from increases in physical and human capital between 1952-1978 to participation of total factor productivity growth after 1978. Key reforms in the 1980s expanded the non-state sector and increased agricultural incentives. China has become the world's second largest economy and largest exporter but faces potential slowing growth as it reaches middle income levels and must transition its growth model to become more sustainable and consumption driven.
Introduction of Globalization, Trends in Globalization, What Are the Benefits of Globalization, Benefits of Globalization and Challenges of Globalization and its effects,
1) The document discusses drivers of startup performance and obtaining venture capital funding, citing work history, social networks, timing, partnerships, and firm strategy as key factors.
2) It also examines what makes the MIT innovation system successful, noting competition, flexibility, commitment to research, and enthusiasm for collaboration.
3) Finally, it hypothesizes drivers of performance for less developed countries, including location in supply chains, access to funds and technology, culture, risk preferences, and network ties.
This document provides an overview of the topic of industrial economics. It discusses key concepts such as:
- Industrial economics deals with economic problems of firms and industries and their relationship with society.
- Descriptive economics aims to provide information to industrialists about resources, infrastructure, competition and policies.
- Analytical economics covers topics like market analysis, pricing, investment planning and financial decisions.
- Other sections define related terms like cottage industry, capital intensive techniques, productivity, intellectual property rights, foreign direct investment, and the factors that influence investment.
Economic reforms were introduced in India in the 1990s led by then Finance Minister Manmohan Singh to liberalize the socialist economy. Prior to reforms, India faced high deficits, low growth at 3.2% annually, and a large unproductive public sector. Reforms aimed to reduce state control over production, establish economic freedom, and dismantle the permit system. Initial results were positive with inflation and interest rates falling and higher growth rates of 4-6% annually in the 1990s compared to 2.9% in the 1980s. However, the reform process has since slowed due to resistance to further changes and a lack of political will to implement additional reforms.
The document discusses trade policies in developing countries, including import substitution industrialization (ISI). ISI aims to reduce dependence on developed nations by protecting and developing domestic industries to compete with imports. While ISI initially saw some success, problems emerged such as inefficient production scales and governments slow to remove protections. Most developing countries rejected ISI in the 1980s-1990s due to unsustainability and pressure from IMF/World Bank for more open trade policies.
Free trade & protectionism part 1-international economicsPaolaReyesR
This document discusses free trade and protectionism. It defines free trade as occurring when there are no barriers to trade between countries, allowing goods to move freely. Protectionism refers to measures that give local producers an advantage over foreign competitors. The document then examines arguments for and against protectionism, such as protecting domestic industries and employment versus higher consumer prices and reduced competition.
The globalization and its impacts, political economy followed by how the globalization and political economy can affect the development of metropolitan cities of the world and the most fascinating part of the presentation which is based upon the case study of Tokyo, Japan that completely seems, the influence globalization and political economy in the city and as last concluding with the future of the urbanization.
Growth & problems of iron, steel, & textile industryLokesh Rathi
The iron and steel industry and cotton textile industry are two of India's oldest and most important industries. The iron and steel industry was prioritized from the first Five-Year Plan and saw significant growth, establishing major steel plants. However, growth slowed in later plans and industries faced issues like underutilization and inefficiency. The cotton textile industry began in the 19th century and production of cotton, yarn, and cloth greatly increased over the Five-Year Plans, though the industry now faces problems around modernization, competition, and taxation. Both industries remain important to India's economy but have ongoing challenges to address.
Monetary policy determines the supply and availability of money in an economy in order to achieve objectives like economic growth and price stability. It is implemented by central banks and involves managing interest rates and the money supply. When the economy is slowing, monetary policy aims to increase the money supply and lower rates to boost aggregate demand. When inflation is high, it seeks to tighten the money supply or raise rates to reduce aggregate spending. The goals are macroeconomic stability with low unemployment and inflation alongside steady growth.
The document summarizes Ronald Coase's seminal work "The Nature of the Firm". It discusses how Coase proposed that firms emerge to minimize transaction costs associated with market exchanges. A firm will grow in size until the costs of organizing additional transactions internally outweigh the costs of conducting them through market exchanges. Coase also put forth the Coase Theorem, which states that when transaction costs are zero, legal entitlements will not affect efficiency and bargaining will lead to an efficient outcome regardless of the initial allocation. Coase's work established transaction cost analysis as a key framework for understanding the boundaries of the firm.
1. The document discusses the gravity model of international trade, which predicts that the volume of trade between two countries is directly related to their GDPs and inversely related to the distance between them.
2. It examines how the largest trading partners of the US are also economies with the largest GDPs in regions like the EU.
3. Over time, trade has shifted from being primarily agricultural and mineral goods to mostly manufactured goods, and distances have become less important due to advances in transportation and communication.
People’s Republic of China which was founded in 1949 was in the position of a self-enclosed economy. Together with the economic reforms carried out in 1980s, China has entered into a transition period from socialist system to free market economy. Together with these reforms, China became a member of IMF in 1989 and World Trade Organization in 2001. As a result of these international expansion policies, the country takes the attention with its high growing rates and becomes the focus of the international capital. Especially after the country became a member in World Trade Organization in 2001, foreign trade volume has expanded and foreign direct investment flow is increased. Foreign trade reforms in China are analyzed in this study because of the outstanding growth in Chinese trade in recent years.
China has experienced rapid economic growth in recent decades, transitioning from a centrally planned economy under Mao Zedong to a socialist market economy under Deng Xiaoping. It joined the WTO in 2001 and became the world's second largest economy by 2010. Key drivers of growth have included decollectivizing agriculture, promoting trade and foreign investment, privatizing state-owned enterprises, and investing heavily in infrastructure. However, China still faces challenges such as an incomplete transition to a market economy, overdependence on exports and investment, and severe environmental pollution. Its rise has also had global consequences, including increasing demand for raw materials, competition for exports, and impacts on currency exchange rates and greenhouse gas emissions.
South Korea transformed from an underdeveloped agrarian economy in the 1960s to the 11th largest economy in the world by 2016. This was driven by export-oriented policies that increased exports from 19.2% of GDP in 1962 to 56.3% in 2012. South Korea also invested heavily in innovation, ranking among the top countries in R&D spending. However, challenges remain such as a aging population and limited natural resources. To maintain growth, South Korea needs continued support for innovation and business.
This document discusses inflation in Bangladesh. It provides definitions of inflation and discusses its causes and effects. Inflation in Bangladesh is currently around 9.15% due to factors like excess money supply, food and non-food price rises, exchange rate fluctuations, and increased money supply and remittances. Controlling inflation requires monetary policy tools like interest rates and exchange rates, as well as wage and price controls combined with policies addressing underlying causes. The conclusion calls for proactive fiscal and monetary policies to contain double-digit inflation in Bangladesh.
This document discusses various aspects of globalization including definitions, features, positive and negative effects, challenges, and the roles of international organizations like IMF, World Bank, WTO, MNCs, and differences between FDI and portfolio investment. It provides country-specific examples regarding globalization in India and its impact. International coordination and management are needed to maximize globalization's benefits and minimize its risks.
Inflation and its trends in indian economyNihar Routray
This document discusses inflation in the Indian economy. It lists the team members and objective to study causes and effects of inflation trends in India. It defines inflation as a rise in general prices and fall in money value. The types of inflation include creeping, trotting, galloping, and hyper. Causes include rises in crude oil and food prices, GDP, and wages. Measuring inflation includes wholesale price indices. Effects are hoarding, risks, consumption impacts. Curbing inflation involves strengthening currency, interest rate hikes, and fiscal policies. Recent inflation is attributed to food and commodity prices. References are also provided.
There are four main types of data: time series data which records values over time, cross-sectional data which records values at a single point in time, pooled data which combines time series and cross-sectional data, and panel data which is a type of pooled data that tracks the same observational units over time. Panel data allows analysis of both differences between observational units as well as changes within units over time, making it a combination of cross-sectional and time series data. It is often used to study things like changes in households or businesses using a unique identifier to follow each unit longitudinally.
Globalization refers to the increasing integration and interdependence of world economies through increased cross-border trade and investment. It includes the globalization of markets, where national markets are merging into a huge global marketplace, and the globalization of production, where companies source goods and services globally to take advantage of lower costs. Global institutions like the WTO, IMF, and World Bank help manage and regulate the global economy. Technological advances in transportation and communication have reduced costs and barriers to global trade and investment. While globalization offers benefits like lower prices and more economic growth, critics argue it can also result in job losses and greater inequality between nations.
This document discusses the gains from international trade. It defines gains from trade as the advantages that countries enjoy through specialization and division of labor when participating in international trade. There are static and dynamic gains. Static gains come from short-term reallocation to comparative advantage sectors, while dynamic gains accumulate over time through factors like increased productivity and investment. Countries can measure gains from trade through approaches looking at reduced production costs, improved terms of trade, and increases in real income. Smaller countries tend to benefit more from trade than larger countries due to greater opportunities for specialization.
The slides tell how technology and politics complement and contradict each other, as well as how technology is used as a tool to serve particular political interest. The slides also show how technology can be perceived in a different context of a country's culture and priority.
Inflation in India is defined as a sharp rise in the general price level. It occurs when there is too much money supply chasing too few goods, causing prices to increase. The document discusses different types of inflation like deflation and stagflation. It also outlines various causes of inflation including demand-pull and cost-push factors. Methods for measuring inflation such as the Consumer Price Index and Wholesale Price Index are presented. The effects of inflation and ways to control it through monetary, fiscal and other policies are described. Public opinion on the issue is also noted.
This document discusses inflation in India. It introduces inflation and defines it as a continuous rise in price levels or a fall in the value of money. When currency levels exceed production levels, inflation occurs. The document outlines objectives to examine the impact of inflation on India's economic growth from 1990-2011 and establish the relationship between inflation and GDP growth. It identifies key reasons for inflation in India like rising crude oil and food prices. The document also explains how inflation is measured using the Consumer Price Index and Wholesale Price Index, and that it will analyze data and draw conclusions about the impact of inflation on India's economic growth.
This document provides an overview of the topic of industrial economics. It discusses key concepts such as:
- Industrial economics deals with economic problems of firms and industries and their relationship with society.
- Descriptive economics aims to provide information to industrialists about resources, infrastructure, competition and policies.
- Analytical economics covers topics like market analysis, pricing, investment planning and financial decisions.
- Other sections define related terms like cottage industry, capital intensive techniques, productivity, intellectual property rights, foreign direct investment, and the factors that influence investment.
Economic reforms were introduced in India in the 1990s led by then Finance Minister Manmohan Singh to liberalize the socialist economy. Prior to reforms, India faced high deficits, low growth at 3.2% annually, and a large unproductive public sector. Reforms aimed to reduce state control over production, establish economic freedom, and dismantle the permit system. Initial results were positive with inflation and interest rates falling and higher growth rates of 4-6% annually in the 1990s compared to 2.9% in the 1980s. However, the reform process has since slowed due to resistance to further changes and a lack of political will to implement additional reforms.
The document discusses trade policies in developing countries, including import substitution industrialization (ISI). ISI aims to reduce dependence on developed nations by protecting and developing domestic industries to compete with imports. While ISI initially saw some success, problems emerged such as inefficient production scales and governments slow to remove protections. Most developing countries rejected ISI in the 1980s-1990s due to unsustainability and pressure from IMF/World Bank for more open trade policies.
Free trade & protectionism part 1-international economicsPaolaReyesR
This document discusses free trade and protectionism. It defines free trade as occurring when there are no barriers to trade between countries, allowing goods to move freely. Protectionism refers to measures that give local producers an advantage over foreign competitors. The document then examines arguments for and against protectionism, such as protecting domestic industries and employment versus higher consumer prices and reduced competition.
The globalization and its impacts, political economy followed by how the globalization and political economy can affect the development of metropolitan cities of the world and the most fascinating part of the presentation which is based upon the case study of Tokyo, Japan that completely seems, the influence globalization and political economy in the city and as last concluding with the future of the urbanization.
Growth & problems of iron, steel, & textile industryLokesh Rathi
The iron and steel industry and cotton textile industry are two of India's oldest and most important industries. The iron and steel industry was prioritized from the first Five-Year Plan and saw significant growth, establishing major steel plants. However, growth slowed in later plans and industries faced issues like underutilization and inefficiency. The cotton textile industry began in the 19th century and production of cotton, yarn, and cloth greatly increased over the Five-Year Plans, though the industry now faces problems around modernization, competition, and taxation. Both industries remain important to India's economy but have ongoing challenges to address.
Monetary policy determines the supply and availability of money in an economy in order to achieve objectives like economic growth and price stability. It is implemented by central banks and involves managing interest rates and the money supply. When the economy is slowing, monetary policy aims to increase the money supply and lower rates to boost aggregate demand. When inflation is high, it seeks to tighten the money supply or raise rates to reduce aggregate spending. The goals are macroeconomic stability with low unemployment and inflation alongside steady growth.
The document summarizes Ronald Coase's seminal work "The Nature of the Firm". It discusses how Coase proposed that firms emerge to minimize transaction costs associated with market exchanges. A firm will grow in size until the costs of organizing additional transactions internally outweigh the costs of conducting them through market exchanges. Coase also put forth the Coase Theorem, which states that when transaction costs are zero, legal entitlements will not affect efficiency and bargaining will lead to an efficient outcome regardless of the initial allocation. Coase's work established transaction cost analysis as a key framework for understanding the boundaries of the firm.
1. The document discusses the gravity model of international trade, which predicts that the volume of trade between two countries is directly related to their GDPs and inversely related to the distance between them.
2. It examines how the largest trading partners of the US are also economies with the largest GDPs in regions like the EU.
3. Over time, trade has shifted from being primarily agricultural and mineral goods to mostly manufactured goods, and distances have become less important due to advances in transportation and communication.
People’s Republic of China which was founded in 1949 was in the position of a self-enclosed economy. Together with the economic reforms carried out in 1980s, China has entered into a transition period from socialist system to free market economy. Together with these reforms, China became a member of IMF in 1989 and World Trade Organization in 2001. As a result of these international expansion policies, the country takes the attention with its high growing rates and becomes the focus of the international capital. Especially after the country became a member in World Trade Organization in 2001, foreign trade volume has expanded and foreign direct investment flow is increased. Foreign trade reforms in China are analyzed in this study because of the outstanding growth in Chinese trade in recent years.
China has experienced rapid economic growth in recent decades, transitioning from a centrally planned economy under Mao Zedong to a socialist market economy under Deng Xiaoping. It joined the WTO in 2001 and became the world's second largest economy by 2010. Key drivers of growth have included decollectivizing agriculture, promoting trade and foreign investment, privatizing state-owned enterprises, and investing heavily in infrastructure. However, China still faces challenges such as an incomplete transition to a market economy, overdependence on exports and investment, and severe environmental pollution. Its rise has also had global consequences, including increasing demand for raw materials, competition for exports, and impacts on currency exchange rates and greenhouse gas emissions.
South Korea transformed from an underdeveloped agrarian economy in the 1960s to the 11th largest economy in the world by 2016. This was driven by export-oriented policies that increased exports from 19.2% of GDP in 1962 to 56.3% in 2012. South Korea also invested heavily in innovation, ranking among the top countries in R&D spending. However, challenges remain such as a aging population and limited natural resources. To maintain growth, South Korea needs continued support for innovation and business.
This document discusses inflation in Bangladesh. It provides definitions of inflation and discusses its causes and effects. Inflation in Bangladesh is currently around 9.15% due to factors like excess money supply, food and non-food price rises, exchange rate fluctuations, and increased money supply and remittances. Controlling inflation requires monetary policy tools like interest rates and exchange rates, as well as wage and price controls combined with policies addressing underlying causes. The conclusion calls for proactive fiscal and monetary policies to contain double-digit inflation in Bangladesh.
This document discusses various aspects of globalization including definitions, features, positive and negative effects, challenges, and the roles of international organizations like IMF, World Bank, WTO, MNCs, and differences between FDI and portfolio investment. It provides country-specific examples regarding globalization in India and its impact. International coordination and management are needed to maximize globalization's benefits and minimize its risks.
Inflation and its trends in indian economyNihar Routray
This document discusses inflation in the Indian economy. It lists the team members and objective to study causes and effects of inflation trends in India. It defines inflation as a rise in general prices and fall in money value. The types of inflation include creeping, trotting, galloping, and hyper. Causes include rises in crude oil and food prices, GDP, and wages. Measuring inflation includes wholesale price indices. Effects are hoarding, risks, consumption impacts. Curbing inflation involves strengthening currency, interest rate hikes, and fiscal policies. Recent inflation is attributed to food and commodity prices. References are also provided.
There are four main types of data: time series data which records values over time, cross-sectional data which records values at a single point in time, pooled data which combines time series and cross-sectional data, and panel data which is a type of pooled data that tracks the same observational units over time. Panel data allows analysis of both differences between observational units as well as changes within units over time, making it a combination of cross-sectional and time series data. It is often used to study things like changes in households or businesses using a unique identifier to follow each unit longitudinally.
Globalization refers to the increasing integration and interdependence of world economies through increased cross-border trade and investment. It includes the globalization of markets, where national markets are merging into a huge global marketplace, and the globalization of production, where companies source goods and services globally to take advantage of lower costs. Global institutions like the WTO, IMF, and World Bank help manage and regulate the global economy. Technological advances in transportation and communication have reduced costs and barriers to global trade and investment. While globalization offers benefits like lower prices and more economic growth, critics argue it can also result in job losses and greater inequality between nations.
This document discusses the gains from international trade. It defines gains from trade as the advantages that countries enjoy through specialization and division of labor when participating in international trade. There are static and dynamic gains. Static gains come from short-term reallocation to comparative advantage sectors, while dynamic gains accumulate over time through factors like increased productivity and investment. Countries can measure gains from trade through approaches looking at reduced production costs, improved terms of trade, and increases in real income. Smaller countries tend to benefit more from trade than larger countries due to greater opportunities for specialization.
The slides tell how technology and politics complement and contradict each other, as well as how technology is used as a tool to serve particular political interest. The slides also show how technology can be perceived in a different context of a country's culture and priority.
Inflation in India is defined as a sharp rise in the general price level. It occurs when there is too much money supply chasing too few goods, causing prices to increase. The document discusses different types of inflation like deflation and stagflation. It also outlines various causes of inflation including demand-pull and cost-push factors. Methods for measuring inflation such as the Consumer Price Index and Wholesale Price Index are presented. The effects of inflation and ways to control it through monetary, fiscal and other policies are described. Public opinion on the issue is also noted.
This document discusses inflation in India. It introduces inflation and defines it as a continuous rise in price levels or a fall in the value of money. When currency levels exceed production levels, inflation occurs. The document outlines objectives to examine the impact of inflation on India's economic growth from 1990-2011 and establish the relationship between inflation and GDP growth. It identifies key reasons for inflation in India like rising crude oil and food prices. The document also explains how inflation is measured using the Consumer Price Index and Wholesale Price Index, and that it will analyze data and draw conclusions about the impact of inflation on India's economic growth.
Inflation in India has been caused by several factors over the past few decades including rising food prices, higher crude oil prices, and increased government spending. Inflation rates in India ranged from 2-10% from 2005-2015, peaking in 2008 during the global financial crisis when crude oil prices surged. While inflation has impacted consumption and economic growth, the Indian government has taken measures to control prices such as liberalizing trade and increasing agricultural productivity. Looking forward, India's growing economy is expected to lead to continued inflation, though the inflation rate may remain stable in the coming years.
The document discusses inflation in India. It provides statistics showing India's inflation rates for wholesale and consumer prices are high at 7.55% and 10.36% respectively in May 2012. The chairman of an economic advisory council notes that while growth is slowing in India, inflation remains at a high level unlike other countries where growth and inflation are both low. The document then examines the nature and causes of inflation in India, including supply shocks from food and fuel price increases, trade deficits, and political instability. It argues that inflation in India is more structural due to issues like bottlenecks in the agriculture sector rather than monetary causes. Finally, it discusses how organized retailing in India could help reduce inflation by improving supply chain efficiency and increasing
This document summarizes an economics presentation on inflation given by Abhinav Duggal and Vikesh Khanna. It defines inflation as a rise in general price levels caused by an imbalance between the money supply and trade needs. It discusses various measures used to calculate inflation rates like the Consumer Price Index and GDP Deflator. The major causes of inflation outlined are demand-pull theory and cost-push theory. Control measures discussed are monetary policy, fixed exchange rates, and fiscal policy. Recent inflation scenarios in India and Zimbabwe's hyperinflation crisis are also summarized. The presentation concludes with an invitation for questions.
The document discusses inflation in India. It provides definitions of inflation and notes that the annual inflation rate in February 2009 was 3.5% according to the wholesale price index. However, the inflation rate rose to 9.89% in February 2021 from 8.56% the previous month. The document also outlines different types of inflation like demand-pull and cost-push inflation. It lists inflation rates from 2006-2007 to 2010-2011 and measures taken by the Reserve Bank of India to control inflation.
The document discusses inflation in India, defining it as a sharp rise in price levels caused by an excess of money supply compared to available goods. It outlines different types of inflation including demand-pull and cost-push inflation. Methods for controlling inflation are also presented, such as monetary measures like credit control and fiscal measures like reducing unnecessary spending. Inflation is measured using indices like the Consumer Price Index and Wholesale Price Index, though the CPI better captures inflation's impact on consumers.
The document discusses inflation in India, focusing on the wholesale price index, factors affecting inflation such as interest rate hikes by the Reserve Bank of India, and consequences like a potential slowdown in investment and private consumption. It recommends further interest rate hikes by RBI and measures like rationalizing price disparities, attracting foreign capital for infrastructure and agriculture, and pushing reforms in land, tax, and infrastructure to manage inflation going forward.
This presentation discusses inflation in India. It defines inflation as a decrease in purchasing power over time where money buys less than it used to. The presentation identifies several causes of inflation in India, including increases in money supply, income, spending, and government expenditure. It also lists effects like redistribution of wealth and income, impacts on production, government, and society. Finally, it outlines measures to control inflation such as credit control, increasing taxes, raising production, and implementing price controls.
GDP stands for gross domestic product. India's current GDP is 4 trillion dollars and its GDP growth rate is 7.7%. GDP is equal to the total expenditures for all final goods and services produced within a country in a year. It can be calculated using the expenditure method as GDP=C+I+G+(X-M), where C is consumption, I is investment, G is government spending, X is exports and M is imports. While GDP gives us an idea of how much a country produces, it does not capture household production or well-being.
This document discusses inflation, unemployment, and the Phillips curve relationship between the two. It defines inflation as a rise in the general price level and identifies different types of inflation including demand-pull, cost-push, and stagflation. Causes of inflation like increases in costs, money supply, and aggregate demand are explained. Methods for controlling inflation including monetary, fiscal, and other supply-side policies are outlined. The Phillips curve relationship is introduced as showing an inverse relationship between inflation and unemployment, though this broke down in the 1970s. Factors like inflation expectations, supply capacity and the non-accelerating inflation rate of unemployment (NAIRU) are discussed in relation to the Phillips curve.
The document contains data on India's inflation rate from 2000 to 2010. Inflation increased substantially from 2006 to 2010, with a peak of 13.18% in 2010. Some key factors that contributed to rising inflation in India over this period included increases in global crude oil prices, as India relies heavily on oil imports; a slowdown in productivity growth; and structural issues in India's banking and rural finance sectors that limit access to credit. Monetary policy tightening by the Reserve Bank of India through higher interest rates and reduced money supply aimed to curb inflation, but other supply-side shocks and global commodity price rises made reducing inflation challenging.
The document discusses inflation, its causes such as demand-pull theory and cost-push theory, its effects like hoarding and hurting creditors and fixed income recipients, and measures taken by governments to curb it, such as monetary measures to control money and credit and fiscal measures to decrease spending and increase taxes. However, the conclusion is that solutions to curb inflation often do more harm than good.
Gdp a concept,principles and applicationRajesh Patel
The document discusses different methods for calculating gross domestic product (GDP), which is the total market value of all final goods and services produced within a country in a given period. It describes the product approach, income approach, and expenditure approach. The expenditure approach defines GDP as the total of private consumption, gross investment, government spending, and net exports. It provides details on how each of these components is measured and categorized in the GDP calculation. The document also discusses GDP per capita as an indicator of living standards and compares GDP to gross national product (GNP).
Inflation is bad for several reasons:
1) For every 1% increase in food prices, an additional 16 million people are threatened with hunger according to a World Bank report.
2) When prices rise, some sections of society gain while others lose. In India, the vast majority of workers do not receive wages indexed to inflation so their wages do not keep pace.
3) The government claims higher prices were inevitable but its mismanagement, mistakes ignoring agriculture, failure to check profiteering, and other policies have contributed to inflation problems in India. Reforms are needed to address the issues.
GDP includes how much we’re spending on things like education, the police and health… But it isn’t designed to measure the outcomes of all that spending – are our kids getting smarter, our streets safer, our hospitals more effective? OECD produces many comparable indicators that can help assess progress. Visit: www.oecd.org/statistics
This chapter introduces the IS-LM model, which combines the Keynesian Cross model and the liquidity preference theory to determine equilibrium income and interest rates in the short run when prices are fixed. The IS curve shows all combinations of income and interest rates that result in goods market equilibrium based on the Keynesian Cross. The LM curve shows combinations that result in money market equilibrium based on liquidity preference theory. Where the IS and LM curves intersect indicates the short-run equilibrium levels of income and interest rates. Fiscal and monetary policies can shift the IS and LM curves to influence equilibrium.
The Federal government and introductory econ textbooks tend to side with lenders in the dispute between lenders and borrowers over inflation. They focus on the problems inflation causes for lenders and the economy through uncertainty and uneven price increases, emphasizing the "evils of inflation."
Liberalization, growth and regional disparities in indiaSpringer
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Pakistan Five Year Development PlansSince 1955 to 2010An Overview
Introduction
Almost all five-year plans prepared during political or military regimes were shelved in the country’s history after regime change and none of them succeeded in getting the desired results.
Pakistan has a semi-industrialized economy, which mainly encompasses textiles, chemicals, food processing, agriculture and other industries.
The economy has suffered in the past from decades of internal political
disputes, a fast growing population and ongoing confrontation with
neighboring India.
Pakistan's average economic growth rate since independence has been higher than the average growth rate of the world economy during the period.
Average annual real GDP growth rates were 6.8% in the 1960s, 4.8% in the 1970s, and 6.5% in the 1980s. Average annual growth fell to 4.6% in the 1990s with significantly lower growth in the second half of that decade.
Introduction
Two wars with India, in Second Kashmir War 1965 and Bangladesh Liberation War 1971 and separation of Bangladesh adversely affected economic growth. In particular, the latter war brought the economy close to recession, although economic output rebounded sharply until the nationalizations of the mid-1970s.
Pakistan is aggressively cutting tariffs and assisting exports by improving ports, roads, electricity supplies and irrigation projects. Islamabad has doubled development spending from about 2% of GDP in the 1990s to 4% in 2003, a necessary step towards reversing the broad underdevelopment of its social sector.
First Five Year Plan (1955-1960) Highlights
Targets
Emphasis mainly on achieving high national income.
The First Plan was implemented within certain obvious handicaps and limitations and its release was delayed by two Years.
In practice, this plan was not implemented, however, mainly because political instability led to a neglect of economic policy, but government, Deputy Chairman Planning Board (Commission) Said Hassan announces the plan in 1957.
The development expenditures were regarded as the foundation for rapid progress in the future and plans explicitly affirmed that some sectors of the economy must be expanded much more rapidly than others in order to secure maximum gains.
The size of the First Plan initially was Rs. 11.5 billion which was revised and decreased to 10.8 billion out of which Rs. 750 million for the public sector and Rs. 3.3 billion for the private sector was allocated. Of the total plan amount of Rs. 6.6 billion from the internal sources and R.s 4.2 billion was to be achieve from the foreign sources in the form of loans and aid.
First Five Year Plan (1955-1960) Highlights
Achievements/Failure
The document discusses the devaluation of the Indian rupee over time. It provides details on what causes devaluation, its effects, and specific instances of rupee devaluation in 1966 and 1991. In 1966, factors like the India-Pakistan war, withdrawal of foreign aid, and a large budget deficit led to devaluation. In 1991, a high trade deficit, current account deficit, inflation, and depleting foreign reserves necessitated another major devaluation. The rupee has fluctuated over the decades since 1966, driven by various economic and geopolitical events both domestic and international.
The document discusses inflation and challenges faced by India's economy over the past decade. It defines inflation and notes that India has struggled with inflation since the 1950s, with rates spiking after economic liberalization in the 1990s. Several factors are identified as contributing to inflation in India during different time periods, including increases in oil prices, fiscal deficits, rising food and commodity costs, and higher government spending. The impacts of inflation on consumers and the overall economy are also reviewed. Challenges like a weakening rupee are examined. Tables show India's inflation rates by year and consumption category from 1990 to 2013.
The document summarizes the history of industrialization in Pakistan from its early ages to the current scenario. It discusses how Pakistan was left with only a small number of industries after partition. The government then took initiatives to establish industries using local raw materials between 1947-1970. However, industrial growth declined after 1971 due to factors like the separation of East Pakistan and economic instability. More recently, the government has announced new policies to improve industries like fashion to boost exports and the economy.
The document summarizes the history of industrialization in Pakistan from its early ages to the current scenario. It discusses how Pakistan was left with only a small number of industries after partition. The government then took initiatives to establish industries using local raw materials between 1947-1970. However, industrial growth declined after 1971 due to factors like the separation of East Pakistan and economic instability. More recently, the government has announced new policies to improve industries like fashion to boost exports and the economy.
An analysis of the Economic Growth experience of Fiji Islands since its independence in 1970. This presentation captures the key points in terms of ideas, resources and policies.
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"Oil and the Economy" Economics Case studyNikhil Gupta
This Presentation will give an idea about the STAGFLATION occured in the USA in 1970's due to increasse of Oil prices as a result of formation of OPEC(Organisation of Petroleum Exporting Countries).
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Trend of inflation from the year 1991 tillBharat Sharma
Inflation in India has been rising since the 1950s but increased drastically after economic liberalization in 1991. Some key points:
1) Inflation hit 13.66% in 1991 due to fiscal deficits, government finance issues, and rupee devaluation.
2) Causes of inflation in the 1990s and 2000s included increasing international oil prices, agricultural issues like drought that raised food prices, and higher government defense spending.
3) Impacts of inflation included liquidity issues, deficit financing challenges, trade imbalances, higher interest rates, and demands for wage increases. Relationships between commodities like crude oil, gold, and the US dollar also influenced inflation trends.
1. The rate of growth of India's national income increased over time from an average of 3.6% between 1951-1980 to 5.6% between 1981-1990 and 6.1% between 1992-2007.
2. However, the rate of growth of agriculture has consistently been lower than the overall economic growth rate and lower than the population growth rate, declining from an average of 2.5% pre-green revolution to 2.5% between 1997-2007.
3. The tertiary sector has seen significant growth, with its share of GDP increasing from one-fourth to close to 60%, particularly in trade, transport, communication, and financial services.
Oil Prices and Nigerian Aggregate Economic Activitiesiosrjce
This paper examines the oil prices and Nigerian aggregate economic activities. The data series
employed were guttered from various sources such as the central bank of Nigeria statistical Bulletin, Economic
and Financial Review, and the publications of International monetary fund. The study employed the linear
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oil prices shock leads to reduction in gross domestic products. It is recommended that government should
diversify its revenue base and develop other sectors of Nigerian economy to contribute significantly to the
growth not of Nigerian Economy
The document summarizes growth and economic policies in India from 1950 to 2006. It divides this period into four phases based on differences in growth rates and changes in policy regimes. The first phase from 1950-1965 saw average growth of 4.1% annually. The second phase from 1965-1981 saw slower growth of 3.2% due to increased socialism. The third phase from 1981-1988 saw improved growth of 4.8% associated with some liberalization. Finally, the fourth phase from 1988-2006 saw the fastest growth of 6.3% following more substantial economic reforms. Scholars debate the relative importance of specific reforms versus other factors in driving India's increased growth over time.
Recite the US track record on growth, unemployment, and inflation.pdfsales113
Recite the factors that influence price elasticity
Solution
There are 9 Factors which Affects the Elasticity of Price. They are as follows.
Share in Total Expenditure:
Habits:
Number of Uses:
Income Level:
Nature of commodity:
Availability of substitutes:
Level of price:
Postponement of Consumption:
Time Period:.
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2. INFLATION
Inflation is defined as a sustained increase in the general
level of prices for goods and services. It is measured as
an annual percentage increase.
3. Phases:
Phase 1: YEAR 1949-1960
Phase 2: YEAR 1960-1970
Phase 3: YEAR 1970-1980
Phase 4: YEAR 1980-1990
Phase 5: YEAR 1990-2000
Phase 6: YEAR 2000-2014
5. 1949-50
The devaluation of rupee in 1949, following the devaluation other
currencies, did not sound well from the point of view of keeping the
inflation in check in the forthcoming years.
It is on this background and also on the background of nationalization of
RBI in 1949, which followed the nationalization of central banks in other
countries .
There were measures adopted by the govt. for which inflation rate
remained at low level of 2.4% in 1949-50.
6. The first year of this phase , witnessed govt.’s endeavour to realise the
benefits of devaluation and to suppress the inflationary impact of the
measure. The important steps initiated were
Cut in the prices of controlled commodities like food grains, cloth, yarn,
pig iron and steel.
Prohibition of futures trading in several commodities to check the
speculation.
Imposition of export duties on some of the articles exported.
Reduction in govt. expenditure, regulation of credit facilities so as to
discourage speculative hoarding of stock of essential commodities.
Introduction of national savings campaign as also substantial tax reliefs
and other concessions to individuals and industries with a view to
encourage investment.
7. 1950-55
The following two years, viz. 1950-51 and 1951-52, however saw the
inflation inching up to around 6% primarily because of an external cause,
i.e. Korean War boom.
The Korean boom, which was essentially a raw material boom, created a
huge stock piling demand, pushing the prices of several internationally
traded strategic materials to abnormally high levels.
The index of industrial raw materials sprang by nearly 40% from 490 to
689 by the middle of 1951, pushing the general index of wholesale
prices up from 393 in May 1950 to 458 in April, 1951.29
8. The year 1952-53 brought with it a big surprise of prices entering into the
negative territory. It was the higher agricultural production that was
behind the deflation of 1952-53.
Two more years, which witnessed negative inflation rates during the
decade of 1950’s and during the second phase of our study were 1954-55
(-6.8%) and 1955-56 (-5.2%). The main factors responsible were
Relaxation of controls over wide sector resulted in bumper agricultural
production & booming of industrial sectors because of large imports &
dishoarding
The first plan, which was essentially an agricultural plan, emphasized
the development of agricultural sector, succeeded not only in achieving
its growth target of 2.1% per annum but also in keeping the inflation
under control.
.
9. FROM 1955-1960
The subsequent plans, It was the industrialization that received the policy
priority and we were doomed to live with high inflation in the following
years
The first year of the second plan, viz. 1956-57, began with an inflation
rate of 14% which was the result of huge demand pressure emanating
particularly from the investment due to industrialization
The latter half of the fifties presented a vastly more complicated
environment in the monetary sphere. It involved a planned public sector
investment outlay of Rs. 4800 crores, a quarter of which was to be met
through deficit financing.
10. FROM 1955-1960
The average inflation rate for the second plan turned out to be 6.28%,
nearly 8% higher than the one recorded during the first plan.
Apart from the large size of the second plan and the manner of financing
it, the other factors responsible for relatively high inflation were
Harvest shortfalls and a sharp fall in foreign exchange reserves due to
large imports particularly of capital goods.
Consequent imposition of controls on imports of many consumer and
intermediate goods.
13. • During the pre-reform period, high fluctuations in inflation
rates were experienced.
• The rise in in inflation rates were induced by the two wars
occurred in 1962 and 1965 respectively.
• The crop failure of 1965-66, one of the worst drought ever
experienced.
• The crop failure led to a fall in agriculture production which fall
by 16% .
• The percentage change in prices varied from a negative value
of 12.8% in 1952-53 to the highest inflation of 13.8 per cent in
1956-57.
14. • During this period the average inflation increased to
6.2%
• The highest inflation rate was recorded for the period
1966-67 at 13.95% followed by an inflation of 11.56%
for the following year.
• Factors contributing to high inflation rates for the
period 1966 to 1967-Pakistan war and famine.
16. Episodes of High Inflation in
India: 1971 to 2012
It may be noted that all
three major drivers of
inflation, viz., food, fuel and
core have been significantly
contributing to the high and
persistent inflation.
Even though these high
inflation periods had
different drivers like oil
shocks, drought and
currency devaluation,
persistence of inflation
seems to be a common
pattern when inflation
turns high.
19. Trend of inflation : 1970-1980
This period turns out to be the most tumultuous
period in India in terms of fluctuations in inflation,
witnessing relatively high rates inflation on account of
the supply shocks emanating mainly from
agricultural and oil prices.
Nationalization of 14 private sector banks on July 20,
1969 was the single most important economic
decision taken by the govt.
20. The first year of this phase 1969-70, which was also
the first year of fourth five year plan saw the
wholesale price inflation to rise very modestly by
3.7%.
During the subsequent two years (i.e. 1970-71 and
1971-72), the increase in consumer price index (CPI-
IW) also was slightly lower.
This modest growth in both WPI and CPI-IW inflation
was achieved mainly because of following reasons :
21. Better availability of goods of mass consumption
Due to good procurement, not withstanding the larger
increases in money supply at 11.3% and 14.0%
respectively in these two years.
22. The inflation recorded during the years 1973-74 and
1974-75 was 20.2% and 25.2% respectively.
It was mainly due to the failure of Kharif crops in 1972-
73 as also to the hike in crude oil prices in 1973.
Another important reason that high inflation of this
period can be attributed to, was the massive influx of
refugees from Bangladesh following the Indo-Pak war
of December 1971.
23. It led to considerable increase in demand for funds by
the govt. compelling it to draw heavily on credit from
the Reserve Bank of India thus causing heavy inflation
in the economy.
The period of four years from 1971-72 to 1974-75 saw
the country passing through a phase of hyper-inflation,
with the average inflation rate touching a high of
15.25% during this period.
It was for the 3rd time in India’s history from 1935 that
price rise had assumed such an alarming proportions.
24. In the early years of 1970’s govt. relied entirely on
monetary and fiscal measures, but realizing their
inadequacy, began its operations against hoarders,
black marketers and smugglers.
The inflation rate moderated from a high 25.2% in
1974-75 to -1.1% in 1975-76, the lowest level
recorded for the decade of 1970’s.
Next two years did not see inflation raising its head
much and in the third year (1978-79) it touched 0%.
25. The year 1979-80, however, witnessed a strong resurgence
of inflationary pressure, resulting mainly from the poor
agricultural output and the second oil shock, raising the
prices of crude oil.
The average inflation during the 1970’s was 9.0%, higher
than the one worked out for the decade of 1960’s.
The standard deviation of 4.9 worked out for the decade of
1960’s, jumped up to 9.0 during the 1970’s.
28. The decade of 1980’s began its journey with the
high inflation rate of 18.2% in 1980-81.
It was due to influence of second oil shock
resulting in oil price hike. The oil price hike of
1979-80 had larger influence on price level in
India compared to first oil price hike.
The relative lower inflation that followed was the
result of substantial and readily available food
stocks, which helped mitigate the scarcity.
Trend of inflation : 1980-1990
29. The inflation during the whole decade of 1980’s
remained steady with the actual inflation rate staying
above 7.0% for around 6 years
It was below 5% only during two years of 1982-83 and
1985-86.
The average inflation turned out to be 8.0% for the
entire decade, very low compared to last decade and
the standard deviation was under 4.
32. Causes of High Inflation
BOP crisis leads to high inflation and Current account
deficit.
Excess demand and supply imbalance in daily used
commodities.
High Exchange rate fluctuation.
Uneven progress of monsoon.
Continuous rise in oil prices, reaching to double digit of
13% increment.
33. Measures to Control Inflation
This phase was basically focusing on making economy
stable and grow.
Stabilization and structural adjustment programme was
implemented.
These programme cover industry, finance, external sectors.
Liberalization on imports, exchange rate, reservation in
public sector
Abolishing licensing on industries.
34. Restrictive provision in MRTP act.
Abandonment of practice of automatic monetization.
RBI took hold of situation through LAF controlling
deficit.
Food price ease due to deceleration in prices.
Cooling of global inflation.
35. Effect on Inflation due to measures
Slow depreciation of rupee from 11% in first half to
4% in second half.
High stock in agriculture releasing some pressure on
food inflation
Increment of foreign reserve help in supply of
different commodity through import.
All these factors help in curbing inflation to 8% for the
decade which was 12% in 1990.
37. Increases in the administered prices of
petroleum products following the
international crude oil price escalation.
Country faced a severe
drought, Adverse
developments such as
border tensions and high
international crude oil
prices
, inflation remained
Moderate at 3.4 per cent
.Previous year
fuelled a spurt in
inflation in India
during the first half of
2004-05 which began
to ease during the
second half due to the
impact of combination
of fiscal and
monetary policies
and south west
Inflation in all the
three sectors
remained high
on account of
high
international
fuel and
commodity
prices.
The year 2009-
10 was an
abnormal one
due to global
slowdown and
unfavourable
monsoon.
Notwithstanding,
the average
inflation was 3.6
per cent backed
by negative
inflation in fuel.
2010-11 was marked by
inflation persisting with
headline inflation
averaging 9.6 per cent.
Hike in vegetable prices
with unseasonal rains
post-monsoon and rising
global commodity prices
that resulted in significant
cost-push and demand-
pull pressures .
Headline inflation of 9.7
per cent which briefly
touched double digit in
September 2011 before
coming down. The major
reason was increase in food
prices, revision in the
administered prices of fuel
as well as an increase in
manufactured product prices
38.
39.
40.
41. Inflationary Experience of India in Comparison to
World
In the 62 years since 1950-51 average annual inflation rate as measured by
changes in the wholesale price index (WPI) increased at a rate of 6.7 per cent per
annum in comparison to the world inflation averaged around 17 per cent per
annum
In the eight year period from 2000 to 2007, the world inflation averaged 3.9 per
cent per annum. Even the emerging and developing economies (EDEs) which
traditionally had very high inflation showed an average annual inflation at 6.7 per
cent. India’s inflation performance was even better at 5.2 per cent as
measured by WPI and 4.6 per cent measured by the CPI.
42. Food inflation
Years Reason
1952-53 Bumper agricultural sale leading to deflation of -12.7
1965-67 Worst drought for 2 year in Indian history reason to 13.9%
1970-71 Good yield helping lowering and containing the inflation
1972-73 But due to high yield and demand the inflation increased.
1973-75 Now due to high demand and low yield, inflation reached to 20% mark
1991 Low progress in monsoon created a rise in prices of basic food commodity like food.
1995-96
Due to decrease in procurement price of food commodity decreases the prices
from 12% to 6% also increase in stock of food help lowering price.
2002 Record stock of food as 58million tons help in stabilizing inflation
2002-03 Help in fighting with drought and fuel prices
2004-05 Low yield in agriculture
44. Years Reasons
1971 Nixon shock increased the prices in fuel and hence inflation
1979
Second oil shock increasing inflation and prices of all commodity were
very high.
1990-92 Trade deficit increased the price of fuel
2000-2002 Increase in oil prices increased the inflation rate
2003-05 Continuous increase in price from $54 to $70 increased inflation rate
2006 Increasing fuel price by Rs 2 petrol and Rs 4 diesel
2007-08 Decreasing fuel price help in lowering inflation
2008-09 Fuel prices skyrocketed to $147
Fuel inflation
48. Oil prices effect on India
Last year- around $110, Yesterday- $46.18
Due to soaring demand and conflicts in oil
producing nations
India is 4th largest importer of Oil.
It constitutes of 37% of total imports or two-third of
trade deficit.
Current price have positive effect.
Subsidy will reduce leading to ease in fiscal deficit.
Inflation go down as transportation will be cheap.
It will help in appreciating the currency.
Negative effect
Oil countries which invest abroad has less surplus to
invest.
49. Fear of possible default by major oil producer
which will hurt the market.
India leads in receipt of remittance and maximum
comes from oil producing nations, which will go
down.
Currently due to very low Prices Indian exports
are also hurting.
People are now thinking on spending on
automobile according to THE ECONOMIST.
What measure now government will take is a
big question?