1.

Inflation

Inflation is defined as a general rise in prices of goods and services in a particular economy. Inflation
leads to erosion of purchasing power of money.

There are mainly 3 types of inflation:

i. Demand Pull Inflation: Too much money chasing too few goods.
ii. Cost Push Inflation: This mainly happens due to constraints from supply side.
iii. Structural Inflation: When economy inherently lacks production capabilities it leads to
structural inflation.

Effects:

i. They add inefficiencies in the market, and make it difficult for companies to budget or plan
long-term.
ii. Uncertainty about the future purchasing power of money discourages investment and
saving.

Measure to control inflation:

i. Monetary: Repo rate, reverse repo rate, SLR, CRR, Bank rate, etc.
ii. Fiscal: Increase in taxes, increase in saving, reduction in unnecessary expenses, etc.

2. IMR & MMR

IMR stands for Infant Mortality Rate where as MMR stands for Maternal Mortality rate.

IMR (Infant Mortality Rate) measures the number of infant deaths under one year per 1,000 live
births, indicating the overall health of newborns. Lower IMR reflects better healthcare.

MMR (Maternal Mortality Rate) quantifies maternal deaths per 100,000 live births, reflecting the
safety of childbirth practices. Decreasing MMR signals improvements in maternal healthcare and
obstetric services.

The Ministry of Health and Family Welfare (MoHFW) is working to reduce IMR and MMR by
supporting states and union territories in implementing the Reproductive, Maternal, New born,
Child, Adolescent health and Nutrition (RMNCAH+N) strategy.

3. Sensex

Sensex, stands for Stock Exchange Sensitive Index, is the benchmark index of the Bombay Stock
Exchange (BSE) of India. It includes 30 of the largest and most actively traded stocks on the BSE.
Sensex serves as a barometer for the overall health of the Indian economy. It is Used by analysts and
investors to track economic cycles and sectoral growth.

Calculation Method: Market capitalization-weighted and float-adjusted.

Review Frequency: Re-evaluated twice a year, in June and December.

Establishment: Standard & Poor’s (S&P) introduced Sensex in 1986.

Indicator for Market Sentiment: Rise indicates general increase in share prices, fall indicates a
decline.

It is Crucial for making investment decisions and understanding the Indian stock market's overall
performance.

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1. Write a note on different characteristic if Indian economy.

The Indian economy exhibits distinctive characteristics that contribute to its complexity and
resilience. From its diverse economic sectors to the challenges posed by a large and youthful
population, these features shape the country's economic landscape. This note explores some key
characteristics that define the Indian economy, highlighting its unique attributes and ongoing
challenges.

Characteristics of the Indian Economy:

1. Diversity:

- India's economy embraces diversity across various sectors, including agriculture, manufacturing,
and services.

- This diversity helps mitigate risks associated with overdependence on a single sector, contributing
to economic stability.

2. Agricultural Significance:

- Despite rapid industrialization, a significant portion of the population remains engaged in

agriculture.

- Agriculture plays a crucial role in providing employment and ensuring food security for the nation.

3. Informal Sector:

- A substantial part of the economy operates in the informal sector, comprising small and
unorganized businesses.

- This sector, while flexible, faces challenges related to labor rights and regulatory issues.

4. Population Size:

- India boasts a large and youthful population, presenting a demographic dividend.

- Efficient utilization of this advantage requires investments in education, skill development, and
job creation.

5. Service Sector Dominance:

 - The service sector, particularly IT, telecommunications, and financial services, has emerged as a
dominant force.

- Information Technology and Business Process Outsourcing have significantly contributed to

India's global economic presence.

6. Public Sector Presence:

- The Indian economy maintains a notable presence of the public sector, with government-owned
enterprises in various industries.

- Public enterprises play a role in sectors such as banking, energy, and telecommunications.

7. Globalization and Liberalization:

- Economic reforms in the 1990s opened up the economy to globalization and liberalization.

- This shift facilitated increased foreign investment, trade, and integration with the global
economy.

8. Infrastructure Challenges:

- Despite progress, challenges in transportation, energy, and logistics infrastructure persist.

- Addressing these challenges is essential for enhancing overall economic efficiency.

9. Inflation and Fiscal Deficit:

- Managing inflation and fiscal deficit remains a persistent challenge.

- Striking a balance between growth and price stability is a key concern for policymakers.

10. Inequality:

- Income and wealth inequality are significant issues, with a notable gap between the affluent and
the economically disadvantaged.

- Ongoing efforts focus on inclusive growth and poverty alleviation to address these disparities.

The Indian economy's unique characteristics reflect a dynamic and evolving landscape. Embracing
diversity, addressing infrastructure challenges, and navigating demographic opportunities are pivotal
for sustaining growth. Policymakers, businesses, and investors need to adapt strategies that consider
these distinct features to foster inclusive and sustainable economic development in India.

2. Write different features of economic planning in India.

Economic planning in India has been a vital component of the country's development
strategy since independence.
Here are several distinctive features characterize the economic planning approach, reflecting
the nation's priorities and goals.

1. Five-Year Plans:

- India adopted the model of Five-Year Plans, inspired by the Soviet Union, to outline its
development goals and strategies.

- Each plan set specific targets for sectors like agriculture, industry, and social services.

2. Decentralized Planning:

- While the central government initiates economic plans, there is a focus on decentralized planning
involving states and local bodies.

- This decentralization aims to address regional disparities and ensure grassroots participation in
the planning process.

3. Public Sector Dominance:

- Economic planning in India emphasized a prominent role for the public sector, with the
government directly involved in key industries.

- Public enterprises were established to spearhead industrialization and infrastructure

development.

4. Import Substitution:

- Initially, economic planning in India adopted an import substitution strategy to reduce

dependence on foreign goods.

- This involved promoting domestic industries to manufacture goods that were previously
imported.

5. Mixed Economy Approach:

- India's economic planning embraces a mixed economy approach, combining elements of both
public and private sectors.

- The private sector coexists with the public sector to drive economic growth and innovation.

6. Social Justice and Inclusive Growth:

- Economic planning in India has consistently aimed at achieving social justice and inclusive growth.

- Policies target poverty alleviation, education, healthcare, and employment generation to uplift
marginalized sections of society.

7. Green Revolution and Agricultural Focus:

- Certain plans, particularly in the 1960s and 1970s, focused on the Green Revolution to enhance
agricultural productivity.

- The emphasis on agriculture aimed to achieve food self-sufficiency and improve the livelihoods of
rural communities.
8. Liberalization and Globalization:

- In the 1990s, economic planning underwent a paradigm shift with liberalization and globalization.

- Reforms aimed at opening up the economy, encouraging foreign investment, and fostering a
more competitive business environment.

9. NITI Aayog and Flexibility:

- The establishment of NITI Aayog in 2015 marked a departure from the Planning Commission
model, introducing a more flexible and collaborative approach.

- The focus shifted from centralized planning to cooperative federalism, involving states in
decision-making.

10. Sustainable Development:

- Recent economic plans underscore the importance of sustainable development, considering

environmental concerns and long-term ecological balance.

- There is an increased emphasis on balancing economic growth with environmental conservation.

Conclusion:

Economic planning in India has evolved over the decades, adapting to changing economic realities
and global trends. From centralized models to more flexible, decentralized approaches, the features
of economic planning reflect the nation's commitment to achieving comprehensive and sustainable
development. The ongoing challenge lies in balancing growth with equity and environmental
stewardship.

3. Discuss briefly about the policy of LPG (Liberalization, Privatization, Globalization) in India.

The LPG policy in India, initiated in the early 1990s, marked a significant shift in the country's
economic paradigm. This transformative policy framework aimed to liberalize the economy,
promote privatization, and integrate India into the global economic landscape. Here's a brief
exploration of each component:

1. Liberalization:

- Objective: Liberalization sought to dismantle the complex regulatory framework and reduce
government intervention in various sectors.

- Key Measures: Abolition of licensing requirements, easing restrictions on foreign direct

investment (FDI), and encouraging competition.

2. Privatization:
 - Objective: Privatization aimed to reduce the government's direct involvement in business
operations and enhance efficiency through private sector participation.

- Key Measures: Disinvestment of government-owned enterprises, opening up sectors for private

investment, and encouraging public-private partnerships (PPPs).

3. Globalization:

- Objective: Globalization aimed to integrate the Indian economy with the global economy,
facilitating the flow of goods, services, and capital across borders.

- Key Measures: Removal of trade barriers, liberalization of import-export policies, and active
participation in international trade agreements.

Impact:

- Economic Growth: LPG policies contributed significantly to India's economic growth, attracting
foreign investment and fostering a more competitive business environment.

- Technology Transfer: Globalization facilitated the influx of advanced technologies and managerial
practices, contributing to enhanced productivity and innovation.

- Increased Foreign Investment: Liberalization measures attracted foreign investors, leading to a

surge in foreign direct investment, which played a vital role in various sectors.

- Job Creation and Skill Development: Privatization and globalization created opportunities for job
growth and skill development, especially in sectors open to private participation.

Challenges:

- Income Inequality: The benefits of LPG policies were not evenly distributed, leading to increased
income inequality.

- Vulnerability to Global Economic Fluctuations: Integration with the global economy made India
more susceptible to economic downturns in the international market.

4. Write briefly the different stages of presentation and passing of the budget in India?

The budget in India is a financial statement that outlines the government’s revenue and expenditure
for the upcoming fiscal year. It is presented by the Finance Minister in the Lok Sabha (lower house of
the Parliament) on the first day of February every year. The budget is then discussed and debated in
both the Lok Sabha and the Rajya Sabha (upper house of the Parliament). After the budget is passed
by both houses of the Parliament, it becomes law.

Here is a different stages of presentation and passing of the budget in India:

1. Budget Formulation:
 - The process begins with the Finance Ministry preparing estimates of revenue and expenditure for
the upcoming fiscal year.

- Various government departments submit their budgetary requirements to the Finance Ministry.

2. Pre-Budget Consultations:

- The Finance Ministry holds consultations with different stakeholders, including industry experts,
economists, and representatives from various sectors.

- These consultations help in understanding the diverse needs and expectations for inclusion in the
budget.

3. Presentation of the Budget:

- The Finance Minister presents the budget to the Parliament on a specified date, usually at the
end of February.

- The budget speech outlines the government's fiscal policies, proposed allocations, and key
financial targets for the upcoming fiscal year.

4. General Discussion:

- After the budget presentation, there is a general discussion in both houses of Parliament (Lok
Sabha and Rajya Sabha).

- Members of Parliament (MPs) have the opportunity to express their views, seek clarifications,
and suggest modifications.

5. Department-wise Discussion:

- The budget is then examined in detail in the standing committees related to various government
departments.

- MPs discuss and scrutinize the allocations specific to each department during these deliberations.

6. Voting on Demand for Grants:

- The budget is subject to voting, typically in July, after the detailed discussions and committee
examinations.

- A series of votes on demand for grants take place, where each government department's budget
is voted upon.

7. Passage of Appropriation Bill and Finance Bill:

- Once the voting is completed, the Appropriation Bill and Finance Bill are introduced.

- The Appropriation Bill authorizes the government to withdraw funds from the treasury, while the
Finance Bill includes taxation proposals.

8. President's Approval:

- After being passed by both houses, the Appropriation Bill and Finance Bill are sent to the
President for approval.

- Once the President gives assent, the budget is considered officially approved.
9. Implementation:

- With the necessary approvals, the government can begin implementing the budgetary provisions
for the fiscal year.

10. Mid-Year Review:

- A mid-year review provides an opportunity to assess the budget's performance, make

adjustments if necessary, and address emerging challenges.

This multi-stage process ensures parliamentary scrutiny and approval of the budget, reflecting
democratic principles and transparency in fiscal matters.

5. Write a note on business journalism and the requirements of a business reporter?

Business journalism is a specialized form of reporting that focuses on covering economic and
financial news, analyzing market trends, and reporting on the activities of companies,
industries, and the broader business environment. It plays a crucial role in providing
information that aids businesses, investors, policymakers, and the general public in making
informed decisions.

Here are some of the requirements of a business reporter:

a. Financial Acumen: Understanding of financial concepts and market dynamics.

b. Research Skills: Proficient in gathering information from reliable sources and
conducting interviews.
c. Communication Skills: Ability to convey complex financial information in a clear and
concise manner.
d. Industry Knowledge: Stay updated on regulations, economic policies, and global
market trends.
e. Curiosity and Resilience: A keen sense of curiosity, coupled with resilience, in a
dynamic reporting environment.
f. Deadline Management: Ability to work efficiently under tight deadlines.

In summary, business journalism plays a crucial role in sharing financial news. A good business
reporter needs to understand finance, research well, communicate clearly, stay updated on industry
trends, be curious, and work efficiently under deadlines. These skills help in providing accurate and
timely information to the public in the ever-changing world of business.

6. What is FDI? Advantages and Disadvantage of FDI

FDI (Foreign Direct Investment): FDI refers to the investment made by a foreign entity, either an
individual or a company, in the business operations of another country with the aim of establishing a
lasting interest and significant control.

Advantages of FDI in India:

1. Economic Growth: FDI contributes to economic growth by bringing in capital, technology, and
expertise, boosting productivity and efficiency in various sectors.

2. Employment Opportunities: Foreign investments often lead to the creation of new businesses and
expansion of existing ones, generating employment opportunities for the local workforce.

3. Technology Transfer: FDI facilitates the transfer of advanced technologies and managerial
practices, enhancing the technological capabilities of domestic industries.

4. Infrastructure Development: Foreign investors often contribute to the development of

infrastructure, such as building roads, ports, and telecommunications, which benefits both the local
population and businesses.

5. Balanced Development: FDI can help reduce regional imbalances by promoting industrialization
and economic activities in less developed regions, contributing to more balanced development.

6. Enhanced Exports: Foreign investments can lead to increased production and exports,
contributing positively to the country's balance of trade.

Disadvantages of FDI in India:

1. Risk of Exploitation: There is a risk that foreign investors may exploit local resources without
adequate consideration for environmental or social concerns.
2. Dependency: Heavy reliance on FDI may create dependency on foreign capital, making the
economy vulnerable to global economic downturns and fluctuations.
3. Cultural Impact: Increased foreign influence may lead to cultural changes and challenges to
traditional practices, which can be a concern for local communities.
4. Loss of Sovereignty: Excessive FDI in strategic sectors may raise concerns about loss of economic
and political sovereignty, as decision-making power may shift to foreign entities.

5. Unequal Distribution of Benefits: The benefits of FDI may not be evenly distributed, leading to
income inequality and social disparities.

6. Competition for Resources: Foreign investors competing for local resources may drive up prices
and create competition that negatively affects local businesses.

Balancing the advantages and disadvantages of FDI is crucial for any country, and effective policies
and regulations play a vital role in maximizing the positive impacts while mitigating potential
drawbacks.
 7. Discuss briefly the different poverty eradication programmes in India?

India has implemented several poverty eradication programs over the years to address the socio-
economic challenges faced by its population. Here's a brief discussion on some of the notable
poverty eradication programs in India:

1. Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA):

- Launched in 2005, MGNREGA guarantees 100 days of employment per year to rural households.

- Aims to enhance livelihood security, reduce rural-to-urban migration, and create durable assets in
rural areas.

2. Pradhan Mantri Awas Yojana (PMAY):

- Launched in 2015, PMAY aims to provide affordable housing for all by 2022.

- Focuses on urban and rural areas, providing financial assistance for the construction of houses
and the development of infrastructure.

3. National Rural Livelihood Mission (NRLM):

- Launched in 2011, NRLM aims to reduce poverty by promoting self-employment and organizing
rural poor into self-help groups (SHGs).
- Provides financial assistance, capacity building, and market linkages for SHGs and their
federations.

4. Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU-GKY):

- Launched in 2014, DDU-GKY focuses on rural youth, providing skill development training to
enhance employability.

- Aims to enable a large number of rural youth to take up industry-relevant skill training.

5. National Social Assistance Programme (NSAP):

- Comprising multiple schemes, NSAP provides financial assistance to the elderly, widows, and
disabled individuals in below poverty line (BPL) households.

- Includes Indira Gandhi National Old Age Pension Scheme, Indira Gandhi National Widow Pension
Scheme, and Indira Gandhi National Disability Pension Scheme.

6. Swachh Bharat Abhiyan (Clean India Campaign):

- Launched in 2014, Swachh Bharat Abhiyan aims to achieve universal sanitation and eliminate
open defecation.

- Focuses on building toilets, promoting sanitation practices, and creating awareness about
hygiene.

7. National Food Security Act (NFSA):

 - Enacted in 2013, NFSA aims to provide food and nutritional security by ensuring access to
subsidized food grains for identified beneficiaries.

- Entitles eligible households to receive food grains at subsidized rates through the Public
Distribution System (PDS).

8. Integrated Child Development Services (ICDS):

- Launched in 1975, ICDS focuses on the holistic development of children below six years, pregnant
women, and lactating mothers.

- Provides services like supplementary nutrition, health check-ups, and early childhood education.

These programs collectively strive to address poverty from various angles, including employment
generation, housing, skill development, social assistance, healthcare, and education, aiming to uplift
the socio-economic conditions of vulnerable populations in India.