Indian economic challenges and issues in the current scenario

Aug. 11, 2010 - PRLog -- Understanding the Indian economy after liberalization in 1992, the economy was open for investments and trade in few of the industry segments. Investments flow was seen across industry segments in the areas of Information Technology, Electronics, Telecommunication, IT enabled services & Manufacturing. Increasingly flowing investments were seen through foreign direct investors and foreign institutional investors in these segments. Secondary set or second degree of investments was seen in the areas of oil and petroleum, retail, textiles, hospitality, entertainment.
The current trend of investments, recovering from the recession is seen in the areas of energy and power, telecommunications, infrastructure, manufacturing & automobiles, IT, health care, tourism. The trend of Indian investments in the overseas market has seen a substantial rise. With India being one of the major developing nations, it will continue to be of key interest for companies to investment in business and economic activities along with countries like China, Brazil, African nations, and Russia.

With the constantly increasing business activities and investments; to sustain the same it is very much essential to have infrastructure that can support the business activities and the economy. Power, energy, waste management, healthcare, agriculture, water management have to be completely addressed to sustain the growth. Infrastructure holds the key in playing a supportive role in overall development of the economy. Emphasis should be on utility oriented investment and the policies and instruments should be designed to support such investments and projects.

Initiatives by government and policies supporting the infrastructure will not only improve the sustainability of the economy but also improve the unorganized business sector there by giving an echo effect into the development of economy. Policies, regulations and directions are the key in supporting the economy and the business activities.

The strength of Indian economy has been the services sector; manufacturing; agriculture & natural resources. Efficient directive steps in utilization of the strengths will ensure sustainable, growth oriented economy.

The current economic issues that need additional attention are

Demand for energy and power and increasing imports of coal and petroleum products.
Increased investments in the area of telecommunication rather than healthcare and infrastructure

Increase in Inflation due to improper management of farming and agriculture.
Poor waste management
Affordable educational reach to all segments of people and educational interests
Congestion of business investments into few industry segments only rather than overall development.

Looking at these issues, gradual improvement can be seen through few of the steps like:

Planning and execution of goal oriented projects in the areas of infrastructure, energy, agriculture & waste management
Regulations and economic policies to support the investments in the above said areas
Investments focusing upon the complete utility and benefits of the investment

Understanding of the complete utility of a project or an investment is very much essential and will help the investment cause immensely
Time duration planning applying short term, interim and long term utility and benefits
Focus on basic issues like agriculture, health care and hospital access, affordable education

The author is Founder of Smart Consulting (www.smartconsulting.in)
Other articles by Smart Consulting: http://www.smartconsulting.in/Understanding_financial_sys...

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Smart Consulting is a Business and Management Consulting firm offering solutions to companies across industry segments. The company offers solutions based on fundamental principles of business and management.