Indian Economy
Indian Economy - Basic Concepts and Development
Indian Economy covers the economic structure, planning, and financial system of India.
Economic Sectors
Primary Sector
Agriculture
- Contributes ~17% to GDP
- Employs ~42% of workforce
- Major crops: Rice, wheat, pulses, cotton
Mining and Minerals
- Coal, iron ore, bauxite, manganese
- Major mining states: Jharkhand, Odisha, Chhattisgarh
Secondary Sector
Manufacturing
- Contributes ~29% to GDP
- Make in India initiative
- Major industries: Textiles, steel, chemicals
Construction
- Infrastructure development
- Roads, bridges, buildings
Tertiary Sector
Services
- Contributes ~54% to GDP
- Largest sector of economy
- IT, banking, tourism, healthcare
Economic Planning
Five Year Plans
- First Plan (1951-56): Agricultural focus
- Second Plan (1956-61): Industrialization (Mahalanobis model)
- Third Plan (1961-66): Balanced growth
- Fourth Plan (1969-74): Growth with stability
- Fifth Plan (1974-79): Poverty eradication
- Sixth Plan (1980-85): Modernization
- Seventh Plan (1985-90): Food production
- Eighth Plan (1992-97): Human development
- Ninth Plan (1997-2002): Growth with social justice
- Tenth Plan (2002-07): Poverty reduction
- Eleventh Plan (2007-12): Faster growth
- Twelfth Plan (2012-17): Faster, sustainable growth
NITI Aayog (2015 onwards)
- Replaced Planning Commission
- Think tank and policy forum
- Sustainable Development Goals focus
Banking System
Reserve Bank of India (RBI)
- Central bank of India
- Established: 1935
- Governor: Head of RBI
- Functions: Monetary policy, currency management
Commercial Banks
Public Sector Banks
- SBI, PNB, Bank of Baroda
- 12 nationalized banks (1969)
- 6 more nationalized (1980)
Private Sector Banks
- HDFC, ICICI, Axis Bank
- Foreign banks: Citi, HSBC
Development Banks
- NABARD: Agriculture and rural development
- SIDBI: Small industries
- EXIM Bank: Export-import financing
Financial Concepts
Budget
- Annual Budget: Presented on February 1
- Railway Budget: Merged with general budget (2017)
- Economic Survey: Presented before budget
Tax Structure
Direct Taxes
- Income Tax
- Corporate Tax
- Wealth Tax
Indirect Taxes
- GST (Goods and Services Tax): 2017 onwards
- Customs Duty
- Excise Duty
Economic Indicators
- GDP: Total value of goods and services
- GNI: GDP + net income from abroad
- Per Capita Income: National income per person
- Inflation Rate: Rate of price increase
- Fiscal Deficit: Revenue deficit + interest payments
Economic Reforms
Liberalization (1991 onwards)
- Devaluation of rupee
- Industrial licensing reduced
- Foreign investment opened
- Banking reforms
Major Reforms
- 1991: Economic reforms begin
- 1997: Insurance sector opened
- 2000s: Infrastructure development
- 2014: Make in India, Digital India
- 2016: GST implementation
- 2020: Atmanirbhar Bharat
Practice Questions
Question 1
Who is known as the “Father of Indian Planning”?
Question 2
When was the Reserve Bank of India established?
Question 3
Which sector contributes the most to India’s GDP?
Question 4
When was GST implemented in India?
Question 5
What is the full form of NITI Aayog?
BETA
