Revised year after year, now into its 28th Edition, this unique book is widely accepted as the core text for graduate / post-graduate courses in Indian economy, in various universities across India. The book is essentially, a collection of select articles by some of India’s topmost economists and experts. These highly recommended original readings are well- supported by editorial notes and excerpts from Plan documents, that together present a comprehensive and critical analysis of Indian economy since independence: 1947-2013.
Additional Info
  • Publisher: Academic Foundation
  • Language: English
  • Chapter 1

    Indian Economy at Independence Price 3.24  |  3.24 Rewards Points

    The pre-Independence period was a period of near-stagnation for the Indian economy. At the time of Independence, Indian economy was caught up in a vicious circle of poverty characterised by one of the lowest per capita consumption and income levels among the countries of the world. Low income levels resulted in low levels of saving and capital formation and therefore, low productivity and low level of income and this vicious circle perpetuated poverty in the country.

  • Chapter 2

    The Economic Legacies of Colonial Rule in India Price 3.24  |  3.24 Rewards Points

    THE long-term legacy of the European empires that ruled over large parts of the non-European world is an enduring theme in world history. Although ‘imperial history’ does not mean the same thing in different academic traditions, the economic consequences of the empires form a more or less coherent discourse. Within that discourse, the British Empire occupies a place of special importance because in some regions of the world, British rule started at the same time that Britain started on a course of rapid modernisation, leading to unprecedented rise in productivity in agriculture and manufacturing industry. Some of the ingredients of modernisation, including new institutions and new technologies, were transferred to the territories ruled by Britain.

  • Chapter 3

    Planning, Market and the State Price 3.24  |  3.24 Rewards Points

    THE launching of the First Five Year Plan in April 1951 initiated a process of development aimed not merely at raising the standards of living of the people but also opening out to them new opportunities for a richer and more varied life. This was sought to be achieved by planning for growth, and social justice.

  • Chapter 4

    Economic Reforms Price 3.24  |  3.24 Rewards Points

    MID 1991 saw a new dawn in the economic history of India. The country then faced a severe economic crisis, triggered largely by an acute BoP (balance of payments) problem. The response to the crisis was to put in place a set of policies aimed at stabilisation and structural reform. While the stabilisation polices were aimed at correcting weaknesses that had developed on the fiscal and BoP fronts, the structural reforms were meant to remove rigidities that had entered various segments of the Indian economy and to make the system more competitive and efficient. Thus the crisis was turned into an opportunity to effect some fundamental changes in the content and approach to economic policy.

  • Chapter 5

    Fiscal and Budgetary Developments Price 3.24  |  3.24 Rewards Points

    Fiscal policy is a critical component of the policy framework for achieving sustained annual growth of 8-10 per cent with macroeconomic stability. High deficits, unproductive expenditure and tax distortions have constrained the economy from realising its full growth potential.

  • Chapter 6

    Demography and Development Price 3.24  |  3.24 Rewards Points

    The chapter begins with a brief discussion of the theory of demographic transition and how does population growth affect economic development. Section II looks into population trends in India and fertility rates followed by population policy since 1947 and human resource development policy in section III. Section IV is devoted to case studies within the country as well as some international comparisions. Section V looks into the future.

  • Chapter 7

    Population Dynamics in India and Implications for Economic Growth Price 3.24  |  3.24 Rewards Points

    The world experienced dramatic population growth during the 20th century, with the number of inhabitants doubling from 3 to 6 billion between 1960 and 2000. India, too, saw very rapid population growth during this period—from 448 million to 1.04 billion—and to 1.21 billion in 2010.

  • Chapter 8

    Growth and Structural Change Since 1950 Price 3.24  |  3.24 Rewards Points

    THIS section is devoted to growth and structural change since 1950. Chapter 8 (ed. notes) outline the growth experience of Indian economy since independence, the turning points in growth rates of national income; covering also the discussion on the new series of national accounts with revised base year of 2011-12, the sectoral change in terms of distribution of workforce and their contribution to GDP (gross domestic product) and also the inter-regional disparities in growth and development. Specific issues relating to the above are discussed in following chapters by Pulapre Balakrishnan (chapter 9), Rakesh Mohan and Muneesh Kapur (chapter 10), C. Rangarajan (chapter 11) and Arvind Panagariya (chapter 12).

  • Chapter 9

    The Recovery of India Price 3.24  |  3.24 Rewards Points

    THIS paper investigates the relationship between the policy regime and economic growth in India over the period 1950-1964, which I term ‘the Nehru era’. Recall that this spans the interval between the formation of the Planning Commission and the death in office of Jawaharlal Nehru. While the choice of the beginning may be easily understood, or in the context even accepted, as marking the initiation of planning for growth, the choice of the ending needs a justification at least in passing.

  • Chapter 10

    Pressing the Indian Growth Accelerator Price 3.24  |  3.24 Rewards Points

    India’s real GDP (gross domestic product) growth averaged almost 9 per cent per annum during the 5-year period 2003-04 to 2007-08, but then growth slipped substantially, reflecting both domestic and global factors. Real GDP growth fell to 6.7 per cent in 2008-09 under the impact of the North Atlantic financial crisis (NAFC), but quickly rebounded to an average of 7.7 per cent during 2009-2012 benefitting from the unprecedented large and coordinated fiscal and monetary stimulus.

  • Chapter 11

    Growth and Investment Price 3.24  |  3.24 Rewards Points

    A review of India’s saving and investment behaviour over the last decade provides some interesting insights on the growth performance over this period. Growth performance falls into two distinct periods, marked by high growth over the first eight-year period followed by a sudden and sharp decline in the last two years.

  • Chapter 12

    India on the Growth Turnpike Price 3.24  |  3.24 Rewards Points

    VIJAY KELKAR is that rare policy economist who can see economic policy reforms necessary to promote growth and poverty alleviation before anyone else, effectively communicate the rationale behind them to policymakers and wider public, and sometimes even successfully implement them himself. In a paper published in 1999 (Kelkar, 1999), Vijay spelt out the entire gamut of reforms necessary to place the economy on a higher-growth path.

  • Chapter 13

    Assessment of the Growth Experience Price 3.24  |  3.24 Rewards Points

    THIS section (chapters 13 to 18) is devoted to distributional issues relating to poverty, inequality, malnutrition and unemployment. Chaper 13 (editorial notes) provides a broad assessment of India’s growth experience in regard to poverty, inequality and unemployment. While chapter 14 outlines the executive summary of the Rangarajan’s Expert Committee Report to review the methodology for measurement of poverty, Rangarajan and Mahendra Dev (chapter 15) have clarified some of the issues raised by researchers on the report of the 2012 expert group on poverty measurement outlined in chapter 13.

  • Chapter 14

    Report of the Expert Group to Review the Methodology for Measurement of Poverty Price 3.24  |  3.24 Rewards Points

    THE apparent urgency with which the Expert Group (Rangarajan) has been formed reflects a need to examine the estimation of poverty in India, keeping in mind the changed perceptions regarding the minimally acceptable standards of living in the country. Poverty lines estimated using the methodology provided by the Expert Group (Tendulkar) did not reflect the changing times and aspirations of the people of India. There was a need to re-examine the poverty line and its composition.

  • Chapter 15

    Counting the Poor Price 3.24  |  3.24 Rewards Points

    IN India, we have had a long history of studies on measurement of poverty.1 The methodology for estimation of poverty used by the Planning Commission has been based on the recommendations made by working group/task force/expert groups consisting of eminent experts in the field.

  • Chapter 16

    Inequities in Access to Health Services in India Price 3.24  |  3.24 Rewards Points

    INDIA , over the last two decades, has enjoyed accelerated economic growth, but has fared poorly in human development indicators and health outcomes. Population averages of health status indicators, such as child health and maternal mortality, remain unacceptably high compared with countries in the south and east Asian region that have similar income levels and rates of economic growth. Underlying the low population level indicators, worrisome inequities coincide with the multiple axes of caste, class, gender and regional differences (Deaton and Dreze 2009; Claeson et al., 2000; Subramanian et al., 2006).

  • Chapter 17

    Labour and Employment in Fast Growing India Price 3.24  |  3.24 Rewards Points

    India has witnessed a rapid and accelerated rate of GDP (gross domestic product) growth during the last three decades since the beginning of 1980s, more so since the early 1990s when the major economic reforms both in domestic and external sectors were initiated. During the three decades, prior to the high growth period, 1950-1980, India had grown at around 3 per cent per annum.

  • Chapter 18

    India’s Labour Market During the 2000s Price 3.24  |  3.24 Rewards Points

    THIS paper examines the changes in India’s labour market during the last three decades, and in the 2000s in particular. During a good part of the 2000s, India was second only to China, among the large economies of the world, in the growth of GDP (gross domestic product). The 2000s are the second decade of the wide-ranging economic reforms that India embarked on in 1991.

  • Chapter 19

    Indian Agriculture Price 3.24  |  3.24 Rewards Points

    Agriculture is the mainstay of Indian economy because of its high share in employment and livelihood creation, notwithstanding, its reduced contribution to the nation’s GDP (gross domestic product). It is the most important sector of the Indian economy from the perspective of poverty alleviation and employment generation.

  • Chapter 20

    The Context and Conundrums of Contemporary Agriculture Price 3.24  |  3.24 Rewards Points

    INDIAN agriculture has been widely studied.1 Without going into a detailed review, this section highlights salient features of the current agricultural economy to provide an understanding of the background and context for the analyses that follow.

  • Chapter 21

    Agricultural Price Policy, Farm Profitability and Food Security Price 3.24  |  3.24 Rewards Points

    AGRICULTURA L price policy plays an important role in achieving growth and equity in the Indian economy in general, and the agriculture sector in particular. The major underlying objective of the Indian government’s price policy is to protect both producers and consumers. Achieving food security at both the national and household levels is one of the major challenges in India today. Currently, the food security system and price policy basically consist of three instruments: procurement prices/MSPs (minimum support prices), buffer stocks and PDS (public distribution system).

  • Chapter 22

    Food Inflation in India Price 3.24  |  3.24 Rewards Points

    Food inflation in India has been stubbornly high, hovering around double digits, for the last couple of years, especially since the United Progressive Alliance (UPA) II regime (2009-10 to 2013-14). In a country which has the largest mass of poor and malnourished people in the world (World Bank, 2013), and where an average household still spends about 45 per cent of its expenditure on food (National Sample Survey Organisation (NSSO ), 2011 data), high rates of food inflation simply speaks of bad macroeconomic management. It acts as an implicit tax on the poor, especially those in the informal sector whose wages are not indexed to inflation, and who don’t have much bargaining power vis-à-vis their employers.

  • Chapter 23

    Industrial Development and Policies since Independence Price 3.24  |  3.24 Rewards Points

    Indian manufacturers had a worldwide market prior to the Industrial Revolution and the rise of modern industry. Before the Industrial Revolution, India accounted for a quarter of world’s industrial output. The exports consisted chiefly of manufactures like cotton and silk fabrics, calicoes, artistic ware, silk and woollen cloth. The impact of the British rule and the Industrial Revolution led to the decay of Indian handicrafts.

  • Chapter 24

    Industrial Performance, 1991-2008 Price 3.24  |  3.24 Rewards Points

    In 1990-91, industry (manufacturing) contributed 26 per cent of India’s GDP (gross domestic product) (15%), employing 15 per cent (12%) of the workforce and using 39 per cent (24%) of the economy’s net renewable capital stock.1 In the 1980s, industry was the economy’s ‘leading’ sector, growing annually at over 6 per cent, while the domestic output grew annually at around 5.5 per cent and exports (two-third of which were manufactures) at 8.5 per cent (in current dollar terms).

  • Chapter 25

    Industrial Development and Policies Since Independence Growth without Employment Price 3.24  |  3.24 Rewards Points

    India launched its economic development efforts in early 1950s, some six decades ago. It pursued the ISI (import substitution industrialisation) strategy for nearly 30 years, and made much progress in raising the living standards, compared to the pre-independence period. The ISI strategy helped India in achieving a diversified industrial structure. However, its growth performance was found to be much inferior to that of Asian countries such as South Korea and Taiwan. India began to liberalise in 1980s and the major economic policy reforms were undertaken in early 1990s.

  • Chapter 26

    On Strategies for Disinvestment and Privatisation Price 3.24  |  3.24 Rewards Points

    THE conceptual foundation of India’s industrialisation strategy was laid by the Bombay Plan, which envisaged a strategic role to the PSEs (public sector enterprises). Over the years, the size of the public sector has increased and currently, there are 473 central PSUs (public sector undertakings) including banks and insurance companies. Out of these, 104 are listed and 369 unlisted, while at the state level there are 1,160 PSUs.

  • Chapter 27

    Of Omissions and Commissions Price 3.24  |  3.24 Rewards Points

    On 1 September 2009, almost unnoticed by the media, an era came to an end with the repeal of the 40 year old Monopolies and Restrictive Trade Practices (MRT P) Act. Drawing upon several high-quality studies by various authors in this journal over the past four decades, as well as my own research, Section 2 of this article provides an unsentimental obituary of the Act, ending with its prolonged and messy demise.

  • Chapter 28

    Small-scale Industrialisation under Globalisation Price 3.24  |  3.24 Rewards Points

    SSI (Small-scale industries) play a significant role in the economic development of nations (Deo, 2013). However, the role that SSI plays in both developed and developing economies has been undergoing remarkable transformation since the early 1990s. This is primarily due to the intensification of globalisation—the opportunities as well as the challenges emerging out of it, specific to SSI (Ibid.).

  • Chapter 29

    The Employment Problem in India and the Phenomenon of the Missing Middle Price 3.24  |  3.24 Rewards Points

    ECONOMIC growth in India, which has accelerated in recent years, has been characterised by some disturbing features—which seem to have set the pattern for Indian economy of not being aligned with international experience of sustained economic development. These include three critical reasons. First, the growth process seems to have been led by the tertiary sector—both in terms of value added and employment, rather than manufacturing.

  • Chapter 30

    Services in India’s Growth Process Price 3.24  |  3.24 Rewards Points

    The services sector covers a wide range of activities from the most sophisticated IT (information technology) to simple services provided by the unorganised sector, such as the services of the barber and plumber. NAC (national accounts classification) of the services sector incorporates trade, hotels and restaurants; transport, storage and communication; financing, insurance, real estate and business services; and community, social, and personal services.

  • Chapter 31

    Infrastructure and Economic Development Price 3.24  |  3.24 Rewards Points

    INFRASTRUCTURE services—electricity, telecommunications, roads, rail, ports, and airports—are critical to the development of a strong, modern, and efficient economy (Lal and Anand, 2014). High costs of production, processing and distribution arising from inadequate and inefficient infrastructure can prevent the economy from realising its full growth potential regardless of the progress on other fronts. Lack of access to basic transportation, energy and communication services will not only make living conditions difficult but also make participation in any modern economy impossible.

  • Chapter 32

    India’s External Sector Price 3.24  |  3.24 Rewards Points

    This section (VI) is devoted to India’s external sector. The editorial notes in chapter 32 provide a broad overview of the external sector relating to policies, developments and issues. India’s foreign trade policy is discussed in chapter 33 (Biswajit Dhar). C. Rangarajan and Prachi Mishra look into the external sector performance since 1991, the reforms and some analytical issues relating to CAD (current account deficit), exchange rates (chapter 34). While FDI (foreign direct investment) and FPIs (foreign portfolio investors) flows and developments are discussed by Nagesh Kumar in chapter 35, the editorial notes in chapter 36 provide a commentary and current status of World Trade Organization (WTO) negotiations and Indian economy.

  • Chapter 33

    India’s New Foreign Trade Policy Price 3.24  |  3.24 Rewards Points

    THE long-awaited Foreign Trade Policy (FTP) of the National Democratic Alliance (NDA) government evoked much interest because it was the first comprehensive statement on the government’s priorities in the external sector, and also, perhaps more importantly, it would show if the present government has set its sights differently from the United Progressive Alliance (UPA) government.

  • Chapter 34

    India’s External Sector Do We Need to Worry? Price 3.24  |  3.24 Rewards Points

    The BoP (balance of payment) in India has come under pressure recently with the CAD (current account deficit) reaching a historical record level of 4.2 per cent of gross domestic product (GDP) in 2011-12. The deterioration in the current account has led to a series of debates in the policy arena relating to the sustainability of the current account, the importance of exchange rates in influencing the trade balance, and the role of high and rising inflation.

  • Chapter 35

    Foreign Direct and Portfolio Investments Flows and Development Price 3.24  |  3.24 Rewards Points

    Foreign capital flows have emerged as key channels of global economic integration all across the world over the past two decades. While FDI (foreign direct investment) flows have been undertaken for a long time by MNEs (multinational enterprises) in the course of their overseas expansion, FPIs (foreign portfolio investments) representing equity and debt flows unaccompanied by management control have become highly visible and often dominant components of the foreign capital flows in recent years with the rise of FIIs (foreign institutional investors) and sovereign wealth funds on the horizon that seek to make quick returns through short-term speculative activities abroad.

  • Chapter 36

    India and the WTO Price 3.24  |  3.24 Rewards Points

    The World Trade Organization (WTO) is an international organisation that oversees the operation of the rules-based multilateral trading system. The WTO is based on a series of trade agreements negotiated during the Uruguay Round (1986-1994), the eighth and final trade round conducted under the General Agreement on Tariffs and Trade (GATT). The Treaty of Marrakesh established the WTO at the close of the Uruguay Round in 1994. The WTO began operations on 1 January 1995; comprising 148 members.

  • Chapter 37

    Indian Economy Today Price 3.24  |  3.24 Rewards Points

    Jawaharlal Nehru’s famous speech at the ‘stroke of the midnight hour’, when India became independent, spoke of ‘ending poverty and ignorance and disease and inequality of opportunity’ and building a ‘prosperous, democratic and progressive’ nation. How has India performed? For the first three decades after independence, growth performance was poor (of course better than under colonial rule). The poverty ratio did not fall, and the number of people in poverty rose substantially.

About the Author