Initiate boldness

 In fact, this growth rate is being viewed to be the highest since the ripple effects of the global slowdown hit the economy in September last year. With most of the major economies still struggling to post even one per cent growth, India posting above six per cent reflects the its economy’s resilience to get out of the slowdown quagmire. In fact, when compared to countries across the world, India stands out as one of the best-performing economies. What is important is that this resurgence in economic growth will inject the psychological feel-good factor, thereby boosting the confidence of trade and industry. This will help ignite the cycle of demand which will push the growth momentum.

However, with the growing apprehension over an impending drought in the face of weak monsoon, the current sign of economic revival may get a severe jolt if the growth rate in the crucial agricultural sector drops significantly. In fact, the Planning Commission in its latest update on the state of economy has cautioned that if the drought situation worsens and agricultural growth declines by six per cent in the worst case, the overall economic growth rate may decline to as low as 5.5 per cent in the current fiscal. Considering that India’s economy continues to be primarily agro-based, the country could hardly afford any slip in agricultural growth rate. Any decline in the agro growth rate will have a cascading effect on the overall growth of the economy. India needs high profile growth, in the range of 8 to 9 per cent, on a sustainable basis to solve two of its most challenging problems — removal of poverty and employment generation through enhanced investment in a wide range of economic activities.
The need of the hour is to evolve necessary policy initiatives to put the economy on higher trajectory of growth by focusing on boosting agro production, revitalising growth in the industrial sector as well as drastically improving the overall macro-economic infrastructure. This will call for bold and radical policy initiatives focusing more on reforming various sectors of the economy.