Hindu Editorial Analysis : 26-February-2024
Recently, there has been a proposal to change the pattern of economic growth in India. This discussion is crucial as it impacts the lives of millions. Understanding what economic growth means and its current implications is essential for recognizing the need for change.
Understanding Economic Growth
Economic growth refers to an increase in the size of a country’s economy over time. This growth is measured by Gross Domestic Product (GDP), which represents the total value of all finished goods and services produced within a country during a specific period. Key points to note about GDP include:
- Definition: GDP is the monetary value of goods and services produced in a country.
- Importance: It reflects the country’s real national and per capita income growth over time.
Current Economic Scenario
In recent years, GDP growth has become the main measure of economic health. The prevailing belief is that we should “increase the size of the pie” before considering how to redistribute wealth. This approach has shifted focus from “socialist” models, which prioritized the well-being of the less fortunate.
- Since the liberalization of the economy in 1991, Indian governments have prioritized GDP growth.
- According to the First Advance Estimates for FY 2023-24, India’s Real GDP is projected to grow by 7.3%.
- The International Monetary Fund (IMF) predicts India will become the third-largest economy by 2027 and will significantly contribute to global growth.
Challenges and Concerns
Despite the focus on GDP, it has limitations. It does not adequately measure the overall quality of life or well-being in a country. Some key concerns include:
- Environmental Damage: Increased production often leads to environmental harm.
- Quality of Life: GDP growth may reduce leisure time or deplete natural resources.
- Inequality: India is becoming increasingly unequal, with many citizens lacking decent jobs, even amidst rising GDP.
Fossil Fuels and Economic Growth
Fossil fuels, including coal, oil, and natural gas, play a vital role in the global economy. They are essential for producing and distributing key materials like steel, concrete, plastics, and food. While they have driven industrialization and economic prosperity, their negative effects on health and climate cannot be ignored.
Why In News
Recently, there has been a proposal to change the pattern of economic growth in India, aiming to create a more sustainable and inclusive model that addresses both economic development and social well-being.
MCQs about Economic Growth in India
- What does GDP stand for in the context of economic growth?
A. General Development Progress
B. Gross Domestic Product
C. Government Debt Percentage
D. Global Distribution Plan
- According to the essay, what is a major limitation of using GDP as a measure of economic success?
A. It is too complex to calculate.
B. It does not consider environmental damage or quality of life.
C. It only focuses on international trade.
D. It is only relevant for developed countries.
- What significant prediction did the International Monetary Fund (IMF) make regarding India’s economy?
A. India will become the largest economy in 2030.
B. India will become the third-largest economy by 2027.
C. India’s GDP will decline in the coming years.
D. India will reduce its reliance on fossil fuels by 2025.
- What is one of the concerns associated with the reliance on fossil fuels in the modern economy?
A. They are always renewable resources.
B. They are crucial for international tourism.
C. They contribute to health and climate issues.
D. They lead to lower production costs.
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