Cover Story : Next Generation Economy & Trade Reforms

When the NDA Government completed its tenure the baton was handed over to the incoming UPA Government with GDP growth nearing double digit in 2004. In contrast, now at the end of Congress-led UPA regime, the GDP growth has plummeted to very low of 4.8%, the inflation and price rise beyond control, the fiscal deficit and current account deficit in the alarm zone, and the manufacturing facing a recession. The GDP in 2013 was USD 1.87 trillion. GDP by different sector was agriculture-16.9%, industry-17% and services-66.1%. The Congress-led UPA has indulged in massive scams during its last five years. In recent years, the Indian Rupee has seen a free fall like never before. To reverse this process, the first thing, which is required, is to restore confidence in the sharp increase in the current account deficit (CAD) is ringing alarm bells. However, this is a mere reflection of the postponement of the next generation trade reforms that have held India back from emerging as a major player in the global economy, with the shares of trade and investment far below its true potential.

“The Government has to give impetus to fresh investments in manufacturing and infrastructure sectors, which are fast decelerating. Public investment in agriculture needs to be enhanced to improve the stagnating crop productivity and incomes in the farm sector, capable of enhancing demand for manufacturing sector, experiencing negative growth. Tax-GDP ratio needs to be improved to curb fiscal deficit. Technical barriers and sanitary & phyto-sanitary measures need be used to curb indiscriminate imports for controlling trade and current account deficits as well as to enhance domestic manufacturing .”—Bhagwati Prakash Sharma, Vice Chancellor Pacific Academy of Higher Education and Research University, Udaipur (Rajasthan)