Current State of the Indian Economy Research Paper

Current State of the Indian Economy - Research Paper Example The country focused on fulfilling the local demand and through the process was able to recover from the economic crises (CIA, 2013). CPI (Cost Price Index): Year Average CPI 1970 5.09% 1971 3.07% 1972 6.43% 1973 16.79% 1974 28.52% 1975 6.62% 1976 -7.57% 1977 8.31% 1978 2.54% 1979 6.23% 1980 11.38% 1981 13.11% 1982 7.93% 1983 11.83% 1984 8.43% 1985 5.55% 1986 8.72% 1987 8.79% 1988 9.39% 1989 7.11% 1990 8.92% 1991 13.88% 1992 11.88% 1993 6.31% 1994 10.24% 1995 10.22% 1996 8.98% 1997 7.25% 1998 13.17% 1999 4.84% 2000 4.02% 2001 3.77% 2002 4.31% 2003 3.81% 2004 3.77% 2005 4.25% 2006 5.79% 2007 6.39% 2008 8.32% 2009 10.83% 2010 12.11% (Inflation.eu, 2013) Inflation rate of the country has varied since 1970s. As seen in the graph the CPI value was the highest in the year of 1974 and was the lowest in 1976. The reason for such a dramatic increase in the country’s CPI value was mainly due to the 1971 conflict of the country with its neighboring country Pakistan. As a result of the war inflation rate in the two countries significantly increased. The same reason can be given for the dramatic decrease in the inflation rate during the time period of May 1976 (The Economist, 2012). The country’s CPI is considered one of the highest in the world and is also considered as the second highest amongst the major economic countries. Inflation has been one of the major concerns of the country with the government trying to develop reforms to manage inflation rates within the country. Prices of goods consumed on a daily basis have significantly increased over the years. With the continuous rise in inflation of the country many experts fear that high inflation rates within the country might lead to a wage spiral within the country (The...This paper offers a comprehensive review of the recent developments in the Indian economy, which is regarded by many economists as a country with a huge growth potential. In order to become one of the leading economic superpower, the cou ntry has to overcome a number of hurdles. These obstacles are complicated and initiatives are needed by the government, industrialists and people alike to work for the progress of the country. The GDP of the country has remained constant over the years with little or no fluctuations occurring. The GDP of the country has seen a sharp increase in recent times mainly due to the measures taken by the government of the country. These measures helped India overcome the economic crisis Cost Price Index of the country has varied over the years with the highest and lowest CPI rates occurring within two years of each other. Inflation has been one of the greatest challenges that the country has to face. With a constant rise in the inflation rates basic commodities within the country are becoming more and more expensive. The government of the country is trying to implement measures that would control inflation rate within the country. Unemployment is a hurdle in the country’s progress. The recent financial crisis have left a large population of the country unemployed. Job opportunities within the country are hard to find and the job creation rate is also on the decline. The government is trying to bring investment back into the country to help job creation within the country.