Topic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.
6) Indian economy is going through the demand drought phase, discuss the factors that have contributed to it and suggest what can be done to revive the demand.(250 words)
Why this question:
The article explains the fall in overall demand being witnessed by the Indian economy.
Key demand of the question:
One must discuss the multiple factors that have led to fall in demand and what needs to be done to rejuvenate the same.
Discuss – This is an all-encompassing directive – you have to debate on paper by going through the details of the issues concerned by examining each one of them. You have to give reasons for both for and against arguments
Structure of the answer:
In brief explain what is meant by ‘demand drought’.
Explain the factors responsible for the demand drought –
lack of jobs, or even where jobs are available — like in the new or digitally enabled “gig” economy — a tenuousness about the incomes from such work, the abiding rural distress, widening inequality and, interestingly, in the opinion of some economists, even the Reserve Bank of India’s successful targeting of inflation are all cited as contributors.
Inflation and issues linked to it.
Then explain what steps should be taken by the government to revive the demand.
Conclude with way forward.