Topic: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.
4. The fiscal year 2021–22 ended with a somewhat mixed picture on the trade deficit front. What are its implications on the Indian economy? Enumerate the measures that are needed to bridge the trade deficit. (250 words)
Difficulty level: Moderate
Reference: Indian Express
Why the question:
Data for the first four months of 2022–23 allow us to make initial assessments about India’s merchandise trade patterns. At first sight, the numbers for April to July 2022 do not look promising as exports have expanded by 20%, but imports have grown by over 48%.
Key Demand of the question:
To write about the trade deficit, reasons for its increase and its impact on the Indian economy, steps that are needed to bridge it.
Structure of the answer:
Introduction:
Start by defining trade deficit.
Body:
Frist, write about the factors that have led to increasing trade deficit in the recent past.
Next, write impact increased trade deficit will have on the Indian economy. Substantiate with facts and examples.
Next, write about ways to mitigate impact of negative impact of increasing trade deficit and bridge the growing deficit.
Conclusion:
Conclude by writing a way forward.
