Why growth has stalled - and it's not what the FM is telling us

Abstract

The real growth engines of the economy - the so-called unorganised businesses - are stalling for want of credit. This is why the country's economy is stalling. The growth rate of our economy has declined from around 8-9 percent in the middle of the decade to around 5-6 percent now. Experts are wondering why this is happening. Government economists such as C Rangarajan and Raghuram Rajan ascribe this to the global slowdown as well as delayed decisions in acquiring land and providing clearances for major infrastructure projects. They are right - but only to a very small extent.

The main drivers of growth in our economy are services, whose share in GDP is around 65 percent. Whenever the term 'service sector' is mentioned, the immediate recall is about information technology and companies like Infosys or Wipro. Factually, all software-related activities come under business services, which itself is less than 5 percent per cent of our national income. Read more at: https://www.firstpost.com/business/why-growth-has-stalled-and-its-not-what-the-fm-is-telling-us-785435.html