Economy

The National Agriculture Market is envisaged as a pan-India electronic trading portal which seeks to network the existing APMCs and other market yards to create a unified national market for agricultural commodities. NAM is a “virtual” market but it has a physical market (mandi) at the back end. NAM is proposed to be achieved through … Read more

National Investment and Infrastructure Fund Limited (NIIFL) is an investor-owned fund manager, anchored by the Government of India (GoI) in collaboration with leading global and domestic institutional investors. funds have investment mandates to invest in infrastructure assets and related businesses that are likely to benefit from the long-term growth trajectory of the Indian economy. Our … Read more

Bad bank or PARA (Public Sector Asset Rehabilitation Agency) was proposed in Economic Survey 2016-17. Bad Bank is an institution which specializes in loan resolution process, so that banking system is free to focus on core banking solutions. Need for PARA According to Economic Survey, need for PARA arises because: Early resolution so that Funds for creation … Read more

Private sector is perceived to be guided by profit maximisation and it was considered to be anti to the objective of independent India. Hence socialism was seen as an alternative to it. This deep rooted notion about private sector is more in India. Following examples are testament to it:   In civil aviation sector, there … Read more

Interest subvention scheme was launched to make available agricultural credit for short term crop loans at an affordable rate to give boost to agriculture productivity and production in the country. The salient features of the scheme are as follows:   It provides concessional of 2% per annum for crop loans to farmers, upto Rs. 3 … Read more

MSP is a form of government intervention to insure the farmers against a steep decline in the prices of their goods and to help them prevent losses. The government of India sets the MSP twice a year for 24 commodities. This is done by the government to protect the farmers against a fall in prices … Read more

While countries around the world have been considering how to implement and measure success against the Goals, NITI Aayog has taken the lead by bringing out the SDG India Index – Baseline Report 2018, and showing how SDGs will be measured in India.  NITI Aayog has constructed the SDG India Index spanning across 13 out … Read more

    Establishment of state level regulatory authorities- Real Estate Regulatory Authority (RERA)- the Act provides for State governments to establish more than one regulatory authority Functions: Register and maintain a database of real estate projects; publish it on its website for public viewing, Protection of interest of promoters, buyers and real estate agents development … Read more

The Agreement on Trade-Related Investment Measures (TRIMs) are rules that apply to the domestic regulations a country applies to foreign investors, often as part of an industrial policy. The agreement, concluded in 1994, was negotiated under the WTO’s predecessor, the General Agreement on Tariffs and Trade (GATT), and came into force in 1995. The agreement … Read more

Government has taken various measures to boost the incomes especially rural incomes to usher spending and consumption levels in the economy. Increase in the Minimum Support Prices (MSPs) for all mandated Rabi crops and Kharif crops for 2019-20 season. To provide an assured income support to the small and marginal farmers, the cash transfer scheme … Read more

Indian economy has some inherent vulnerabilities and that is becoming hurdle in holistic development of the economy. These areas are as follows: Investment rate is on decline. It is near about 29%. It has to be 36-38% for sustaining high growth rate as per economic survey. Investment is way better than savings as engine of … Read more

Foreign Trade Policy of India has always focused on substantially increasing the country’s share of global merchandise trade. Accordingly the Government of India has been taking various steps towards boosting its trade with the rest of the world by adopting policies and procedures which would help to increase and facilitate both exports and imports with … Read more

The Policy is based on a principle of industrial growth in partnership with the States.  Central Government will create the enabling policy framework, provide incentives for  infrastructure development on a PPP basis through appropriate financing instruments,  while State Governments will identify the suitable land and be equity holders in the  National Investment and Manufacturing Zones … Read more

To sustain the reforms brought in by scheme on ‘End to End Computerization of Targeted Public Distribution System (TPDS) Operations’ the Department of Food & Public Distribution has launched a new scheme namely “Integrated Management of Public Distribution System (IM-PDS)” for implementation during 2018-19 and 2019-20. The main objective of the scheme is to introduce … Read more

With growing sectors like automotive components, pharmaceuticals, cement, textiles, FMCG and e-commerce, there was the need of the healthy and efficient logistics sector. India rank 35 out of 160 in the logistics performance index. ( This is quite low). Hence GOI recently granted infrastructure status to the logistics.   Major benefits attached by granting infra. … Read more

The Government of India encourages foreign investment in the automobile sector and allows 100 per cent FDI under the automatic route. Some of the recent initiatives taken by the Government of India are – The government aims to develop India as a global manufacturing centre and an R&D hub. Under NATRiP, the Government of India … Read more

Unbalanced regional growth is the major reason for non transmission of positive effects of growth period. This anomaly leads to poor development of some states. The condition of them being poor necessitated more borrowings and aids and low revenue capacity make them incapable of fuelling investment in employment generated events. This lead to high debts … Read more

  Promotion of commodity-based farmers’ organisations such as Small Cotton Farmers’ Estates to combine decentralised production with centralised services such as post-harvest management, value addition and marketing, for leveraging institutional support and facilitating direct farmer-consumer linkage. Improvement in implementation of Minimum Support Price (MSP). Arrangements for MSP need to be put in place for crops … Read more

a) Disinvestment: Disinvestment means sale or liquidation of assets by the government, usually Central and state public sector enterprises, projects, or other fixed assets.The government undertakes disinvestment to reduce the fiscal burden on the exchequer, or to raise money for meeting specific needs, such as to bridge the revenue shortfall from other regular sources. b) … Read more

  Foreign Direct Investment Foreign Portfolio Investment FDI is an investment made by a company or individual in the business of another country in the form of either establishing a new business or acquiring the existing business. FPI is an investment made by a company or an individual in the stock markets or debt markets … Read more

The Washington Consensus is a set of ten free market economic policy prescriptions considered to constitute the “standard” reform package promoted for crisis-wracked developing countries by Washington, D.C. – based institutions such as the International Monetary Fund (IMF), World Bank and United States Department of the Treasury. The prescriptions encompassed policies in such areas as … Read more

Higher education has to be taken to next level to make India a knowledge economy. But quality of HE is an issue and that need quick redressal. The  major steps that can be taken to transform Higher education are: Implementation: Implementation of reforms as pointed out by TSR Subramanian Committee. Autonomy: Reforming or replacing UGC, … Read more

Ans:  Green Box Subsidies: The subsidies which cause no, or at most minimal, trade distorting effects or effects on production. These subsidies are permitted under WTO regime, for instance; Government services such as research, disease control, and infrastructure and food security.   Amber Box Subsidies : All domestic support measures considered to distort production and … Read more

Along with bringing transparency and accountability in enforcement of Labour Laws, the Government has taken various initiatives to realize and establish the dignity of every worker through provision of social security, enhancing the avenues and quality of employment along with industrial development. Recent major reforms are: Introduction of Labour Codes In line with recommendations of … Read more

Monetary transmission refers to the process by which a central bank’s monetary policy decisions are passed on, through financial markets, to businesses and households.     A Ponzi scheme is a fraudulent investing scam promising high rates of return with little risk to investors. Instances of people losing their hard-earned money to Ponzi schemes keep … Read more

  To organize training programmes for educational functionaries for developing capacities of educational planning and administration. To strengthen capacities for training and research in the field of educational planning and administration. To provide consultancy services in the sphere of educational planning and administration to Central as well as State Governments, Universities, Board and other similar … Read more

The Monetary Policy Committee (MPC) constituted by the Central Government under Section 45ZB determines the policy interest rate required to achieve the inflation target. The Reserve Bank of India Act, 1934 (RBI Act) has been amended by the Finance Act, 2016,  to provide for a statutory and institutionalised framework for a Monetary Policy Committee, for … Read more

The term “liberalization” in this context implies economic liberalization. The essence of thispolicy is that greater freedom is to be given to the entrepreneur of any industry, trade orbusiness and that governmental control on the same be reduced to the minimum. Rules and laws which were aimed at regulating the economic activities became majorhindrances in … Read more

new integrated cold chain projects are likely to generate direct and indirect employment for 16,200 and are likely to benefit 2,57,904 farmers. The projects have been approved across the states of Andhra Pradesh (7), Bihar(1), Gujarat(2), Haryana(4), Karnataka(3), Kerala(1), MP(1), Punjab(1), Rajasthan(2), Tamil Nadu(4) and Uttar Pradesh(1). These 27 new integrated cold chain projects will … Read more

Recently a moratorium was put on withdrawal limit upto 50,000 by RBI circular. This lead to panic among the YES bank consumers which led to fall in the share price. RBi came up with restructuring scheme. SBI will invest in 49% stake and other private investors have also invested in the bank. Even though the … Read more

Development of port infrastructure in India is not on par with the other ports across  the world. Trade in India has to face severe challenges due to inefficient port services.  Shipping lines avoid touching ports in India because of the long waiting time. The capacity  of various ports including Mumbai has already been exhausted and … Read more

HELP is the new Hydrocarbon exploration Licensing policy. The key features of HELP are as follows:   India has announced HELP, which offers single license to explore conventional and unconventional oil and gas resources. The new policy also gives the investors the much needed freedom in pricing and marketing for crude oil and natural gas. … Read more

Small and Medium-sized enterprises (SMEs) are labour intensive, have the advantage of low cost of production and can make good use of locally available resources pushing demand and growth. The sector offers a wide range of employment opportunities and absorbs most of the working age population. Majorly consists of handlooms, handicrafts, coir, sericulture, khadi and … Read more

According to a report of Oxfam international , India’s richest now hold 58% of country’s wealth. 57 billionaires in the country have the same wealth as that of the bottom 70% population, Wealth inequality is a serious issue. The reasons for wealth inequality are: Growing incidence of Tax avoidance and Tax evasion Existence of black … Read more

In nationalised banks, the government owns more than 50% of the shares, which gives it majority voting rights. Because of this, the government can interfere in the boards of such banks and appoint inefficient people to the boards. That is, the appointment of the members might not always be based on merit. This will lead … Read more

‘Voluntary Retention Route’ (VRR) to encourage Foreign Portfolio Investors (FPIs) to undertake long-term investments in Indian debt markets. Under this scheme, FPIs have been given greater operational flexibility in terms of instrument choices besides exemptions from certain regulatory requirements. The details are as under: -The aggregate investment limit shall be ? 40,000 crores for VRR-Govt … Read more

The Reserve Bank of India gives temporary loan facilities to the centre and state governments as a banker to government.  This temporary loan facility is called Ways and Means Advances (WMA).The WMA scheme for the Central Government was introduced on April 1, 1997, after putting an end to the four-decade old system of adhoc (temporary) … Read more

Over the years, the government has gradually withdrawn from direct management of public institutions, devolving governance to boards compromising academics, alumni and external members. Instead, it exerts indirect forms of control based largely on mechanisms such as performance-linked funding and quality recognition. The erstwhile regulatory regime of multiple bodies with conflicting and overlapping mandates has … Read more

Positives: Low Import Bill Low pressure on Current account deficit. Ease in the balance of Payment. Ease of pressure on Inflation. Low price for consumer if the lower price effect pass on and High revenue for centre and states if the effect doesn’t pass on to the consumer. Money saved can be utilised for social … Read more

Inflation is defined as a sustained increase in the general level of prices for goods and services in a county, and is measured as an annual percentage change. Increase in money supply: In the last few years rate of supply of money is very high i.e. near about 15-18% but the national output is hovering around … Read more

Financial inclusion involves the availability of sustainable, useful financial products and services for all business and individuals, regardless of company size or individual net worth. It makes financial services such as banking, insurance, equity, etc. available equally to all, without discrimination. Universal access to banking facilities for all households across the country through a bank … Read more

It was in the wake of the Liberalisation in 1991 that it cecame imperative for the government to reform the financial sector in order to reinvigorate the economy. GOI set up committee under the guidelines of  Narsimha. Recommendation: It advised the RBI not to use CRR as a principal investment of monetary and credit control … Read more

Steps taken by RBI:   Establishment of private Asset Reconstruction Companies (ARCs) Many ARCs have been created, but they have solved only a small portion of the problem, buying up only about 5 percent of total NPAs.   Strategic debt restructuring scheme: under this creditors could take over firms that were unable to pay and … Read more

  To ensure that all secondary schools have physical facilities, staffs and supplies at least according to the prescribed standards through financial support in case of Government/ Local Body and Government aided schools, and appropriate regulatory mechanism in the case of other schools. To improve access to secondary schooling to all young persons according to … Read more

The Ministry of road transport and highways has taken up detailed review of NHs network with a view to develop the road connectivity to Border areas, development of Coastal roads including road connectivity for Non-Major ports, improvement in the efficiency of National Corridors, development of Economic Corridors, Inter Corridors and Feeder Routes along with integration … Read more

Bank rate:  Bank rate is the rate at which RBI lends long term to commercial banks. Bank rate is a tool which RBI uses for managing money supply.   Merchant discount rate: It is a charge to a merchant by a bank for accepting payment from their customers in credit and debit cards every time … Read more

The Government proposed to launch amega pension Yojana namely ‘PradhanMantri Shram-Yogi Maandhan’ for theunorganised sector workers with monthlyincome up to Rs 15,000. As per Finance ministry half ofIndia’s GDP comes from the sweatand toil of 42 crore workers in theunorganised sector working asstreet vendors, rickshaw pullers,construction workers, rag pickers,agricultural workers, beedi workers,handloom, leather and in … Read more

The interest rate fluctuation impacts foreign investment in India. The developing countries like India tend to have a higher interest rate than those developed countries. The foreign investment institutes such as FIIs (Foreign Institutional Investors) borrow money from their domestic market at a low-interest rate and invest it in countries like India where the interest … Read more

Core sectors of an economy are the main or the key industries in the economy. In India, there are 8 sectors which are considered the Core Sectors. The eight core sectors of the Indian economy are: Electricity Steel Refinery products Crude oil Coal Cement Natural gas Fertilisers These industries have a major impact on the general economic … Read more

India’s fact sheet of ports consists of twelve major ports (two additionally approved—  one in West Bengal and the second at Andhra Pradesh) and two hundred odd minor ports  accounting for 95 per cent of cargo movement by volume and 70 per cent by value. The  present port capacity is around 1000 million tonnes (MT). … Read more