India's growth: Its problems and solution

Indian economy has been growing at a rapid pace for the past 5 years barring the slow down during the crisis year. The main driver of this growth has been our service sector and the burgeoning foreign reserves thanks to the FDIs and FIIs flowing into India
The growth rate of any economy is measured in terms of increase in gross domestic product (GDP) in a given time period. GDP is the net value of all goods and services produced within a country in a given time period.
Indian economy is broadly divided into 3 sectors
i) Agriculture sector
ii) Industrial sector
iii) Service sector
Agriculture sector:
It employs 60% of our workforce. However it’s contribution to GDP is disproportionately low. Hence the fruits of growth and development don’t reach these 60%. Efforts need to be made to boost agriculture sector as india is mainly an agrarian economy. India is bestowed with large land area criss crossing with rivers and streams. Optimum utilisation of resources can lead to maximising yield and hence more money in the pockets of the farmers. Micro watershed management needs to be taken up on a priority basis especially in drought prone regions. Scientific agriculture should be adopted. Research findings need to be implemented. All these measures along with a holistic developemnt of key social sector areas can lead to a sustainable and higher growth of our agriculture sector
Industry sector:
We have the advantage of a huge population and this can serve as a huge demographic dividend for our country. But the lack of skill among majority of work force is an area of concern. In this land of a billion, employment is never a problem but lack of employable skills denies many a denizens the right to lead a dignified and prosperous life. Every year an estimated 15 million workforce enter the job market. But our institutions can train only a 3 million workforce. This is an area of concern.
Our industrial sector has attracted large foreign investments. Indian industry offers the following advantages
i) Cheap labour
ii) Cheap raw material
iii) Big and diverse market
However there is lot of scope to increase foreign investment in our industries. There are certain bottlenecks which need to be removed. They are
i) Obselete and stringent labour laws
ii) Inefficient banking system
iii) Overstressed physical infrastructure
Labour laws need to be amended to provide for easy shutting down of industries. Our banking systems are slow interms of verification and approval loans. Our ports are painstakingly slow in unloading and laoding, our roads are crowded and our power supply is frequently interrupted. The golden quadrilateral has adressed the problem of roads to some extent. But freight movement is mostly through railways . Railways need to implement the freight corridor project at war footing in order to not deny india the opportuniy to grow at over 10%. Our power stations are unable to meet the growing needs of differen sectors. The give away schemes of govt towards agriculture have resulted in disproportionate(over 80%) consumption of power in agriculture sector.
Power supply systems are easily tamperable and are hence prone to leakages. Measures need to be taken to ensure optimum utilisation of our power resources.
Services Sector:
Services sector employs around 20% of our work force and contributes to over 60% of our GDP. Services like Software, Hotels , Tourism have helped in boosting india’s image at international level. In the crisis period Software exports and worker remittances kept us afloat and ensured india was among the handful countires that showed a positive growth. Improvements in communication technology has helped in sectors like BPO to flourish. India has excelled in field of software while china is leader in hardware. A harmonious partnership between the two asian giants can ensure a boost in foreign trade.
Despite delivering a positive growth rate , we still arent able to put money into the hands of poor. The reason for this is the unbalanced regional development. Over 50% of FDI is concentrated in Mumbai and Delhi. This is majorly because of the infrastructure and transport facilities in these regions. With such high disparities it is difficult to achieve inclusive growth. Innovative concepts like rural BPOs need to be encouraged to deliver the fruits of India’s growth in the hinterlands.