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Major Economic Challenges

During past 5 years

Presented By:

Savneet Kaur

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World Economic And Social survey 2007

Survey analyses the implications of ageing for social

and economic development around the world. The

ageing of the population offers both challenges and

opportunities. Among the most pressing issues is theprospect of a smaller labor force having to support and

increasingly larger older population. Paralleling

increased longevity, changes in intergenerational

relationships may affect the provision of care andincome security for older persons particularly in

developing countries where family transfers play a

major role.

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2008

Survey offers a different perspective on economic

insecurityone that utilizes more proactive andcoherent policy responses, at both national and

international levels, to help communities better

manage economic risks, cope with economic insecurity

and secure their livelihoods.

2009

Survey argues that mitigation and adaptation efforts

can better move forward as part of a development

strategy built around a massive investment-led

transformation, along low-carbon, high-growth paths.

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This transformation would keep temperature increasesconsistent with environmental stability, while fosteringthe strong growth and economic diversification

necessary to allow convergence of incomes worldwide. 2010

Survey highlights the systemic weakness unmasked bythe recent global crisis and proposes reforms in

international arrangements to eliminate thesedeficiencies and gaps in global governancemechanisms. These weaknesses have undulyconstricted national policy space and sustain the

proliferation of conflicting international rules. Theproposed reforms are aimed at ensuring consistencyamong national development efforts and globalmechanisms in aid, trade and finance to pave the waytowards more balanced and sustainable development.

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Developing economy- Indian economy

The Economy of India is the ninth largest in the

world by nominal GDP and the fourth largest by

purchasing power parity.India recorded the highest growth rates in the

mid-2000s, and is one of the fastest-growing

economies in the world.India is the seventeenth largest exporter and

eleventh largest importer in the world.

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India's Per Capita Income has tripled from $ 423

in 200203 to $ 1219 in 201011, averaging14.4% growth over these eight years.

India has made huge progress in terms of

increasing primary education attendance rateand expanding literacy to approximately three-

fourth of the population. India's literacy rate

had grown from 52.2% in 1991 to 74.04% in

2011.

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Problems faced by Indian economy

Inflation

Fuelled by rising wages, property prices andfood prices inflation in India is an increasing

problem. Inflation is currently between 6-7%. Poor educational standards

Although India has benefited from a high % of

English speakers. There is still high levels ofilliteracy amongst the population. It is worsein rural areas and amongst women. Over 50%of Indian women are illiterate.

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Poor infrastructure

Many Indians lack basic amenities, lack access torunning water. Indian public services are creakingunder the strain of bureaucracy and inefficiency.Supply constraints and inefficiency are faced bythe Indian economy.

High levels of Debt

Buoyed by a property boom the amount oflending in India has grown by 30% in the pastyears. Furthermore if inflation increases further itmay force the RBI to increase interest rates. If

interest rates rise substantially it will leave thoseindebted facing rising interest payments andpotentially reducing consumer spending in thefuture.

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Inequality has risen rather than decreased

However so far economic growth has been

highly benefiting the skilled and wealthydisproportionately. Many of Indias rural poor

are yet to receive any tangible benefit from

the Indias economic growth. More than 78million homes do not have electricity. 33%

(268million) of the population live on less

than $1 per day.

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2007

The total fiscal deficit of India (i.e. the combined

deficits of the central and state governments) isestimated at around 5.6% in 2007-08.

The estimated revenue deficit for 2007-08 was

around Rs 634 billion, while the fiscal deficit wasaround Rs 1.44 trillion. Hence, the revenue deficit

as a percentage of fiscal deficit is close to 50.

In 2008, Threat of inflation was very real in Indiaand all over the world. With the interest rates

hardening, growth was already getting impacted.

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2008

Inflation continues to pose a threat. Inflation

peaked at 12% in early August 08.Recession: Indias growth is not so dependent

on growth in the West. However, the Indian

stock markets have been hit by the globalcrisis. Indias growing service sector and

manufacturing sector got adversely impacted

by a global downturn.

The Indian Rupee has had a surprisingly weak

year. The Rupee has fallen from 39 to 44.

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2009

The weakest section of the economy was

agriculture which showed growth of just 0.9%in the year 2009.

The food price inflation, which has touched

15%. This food price inflation hits the poorestthe hardest and threatens to widen the gulf of

inequality that exists in India.

Situation was controlled in this year.

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2010-2011

The total expenditure of the government has

been reduced from 15.4% of GDP (2010-11) to14% of GDP in 2011-12.

The unemployment rate remains at a level of 8%.

The Economic Survey 2010-11 says thatcontinued high food inflation is a concern facing

the Indian economy and the policy makers.

The food-grain production in the country was234.5 million tones in 2008-09 which declined to

218.1 million tones in 2009-10 and subsequently

increased to 232.1 million tones in 2010-11.

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Developed economy- America

2007

Energy and Environmental Security

Conflict and Poverty

Competing in a New Era of Globalization

Global Imbalances

Rise of New Powers

Global Health Crisis

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2008/2009

Restoring financial stability

Recession

Exercising smart power

Reimagining global tradeNavigating Chinas rise

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2011

The United States is facing economic disasteron a scale few nations have ever experienced.

They import much more than they export, and

they are selling off our assets and taking onmassive debts to sustain a standard of living

they can no longer afford.

They are failing even to acknowledge

predatory foreign trade practices.

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THANK YOU!!!!!