Notes

Economic survey chap (1 and 2)

• Indian society exhibits strong son “Meta” Preference
Parents continue to have children until they get the desired number of sons. This kind of
fertility-stopping rule leads to skewed sex ratios but in different directions: skewed in favor of
males if it is the last child, but in favor of females if it is not the last. Where there are no such
fertility-stopping rules, ratios remain balanced regardless of whether the child is the last or not.

• To re-ignite growth, raising investment is more important than raising saving

• The footprint of climate change is evident and extreme weather adversely impacts agricultural yields
The impact of weather is felt only with extreme temperature increases and rainfall deficiencies.
This impact is twice as large in un-irrigated areas as in irrigated ones.

Terminologies

Economic Trough: A trough is the stage of the economy’s business cycle that marks the end of a period
of declining business activity and the transition to expansion. In general, the business cycle is said to go
through expansion, then a peak, followed by contraction and then finally bottoming out with the trough.

Sovereign Ratings Upgrade: Moody’s Investors Services upgraded India’s sovereign ratings to Baa2 from
its lowest investment grade (Baa3). It would bring down the costs of overseas borrowing for Indian
companies.

4 R’s of the Twin balance sheet—Recognition, Resolution, Recapitalization, and reforms

India has two underlying macro-economic vulnerabilities, its fiscal and current accounts, both of
which tend to deteriorate when oil prices rise.

Overcoming the fiscal vulnerability requires breaking the inertia of the tax-GDP ratio. Overcoming the fiscal vulnerability also requires halting the steady conversion of contingent liabilities into actual ones (typically through the assumption of state discom debts and public sector bank recapitalization),which has impeded progress in debt reduction even in the face of solid growth.

Addressing the current account vulnerability requires raising the trajectory of export growth.
Reviving manufacturing and making the sector internationally competitive have been the twin goals
of the Make in India program, underpinned by a strategy of reducing the costs of doing business.
the international competitiveness of manufacturing has not made great strides, reflected in the declining manufacturing
export-GDP ratio and manufacturing trade balance.

The world economy embarked on a synchronous recovery, but India’s
GDP growth—and indeed a number of other indicators such as industrial production, credit, and
investment—decelerated. There are five reasons for this
1) Gst
2) Demonitisation
3) Twin balance sheet problem
4) Oil prices
5) India’s monetary conditions decoupled from the rest of the world. Until the middle of 2016,
real policy interest rates were following the global trend downwards. Since then, the downward drift
has continued in most other countries, with rates falling. But in India, for the same period, average
real interest rates increased. This tightening of monetary conditions contributed to the divergence in
economic activity in two ways. First, it depressed consumption and investment compared to that in
other countries. Second, it attracted capital inflows especially into debt instruments, which caused
the increase in demand for rupee and consequently rupee appreciates which causes dampening of
exports

Macro-economic Indicators
Headline inflation for the first time crossed the RBI’s 4 percent target in November, posting a rate of 5.2
percent in December 2017. The recent upswing in inflation stems from rising global oil prices, unseasonal
increase in the prices of fruits and vegetables, and the 7th Pay Commission housing rent allowances,
which mechanically increase inflation. Stripped of all these factors, underlying inflation has been increasing
at a more modest pace, reaching 4.3 percent at end-December.
The current account deficit has also widened in 2017-18 and is expected to average about 1.5-2 percent
of GDP for the year as a whole. Despite these developments, the overall external position remains solid.
The current account deficit is well below the 3 percent of GDP threshold beyond which vulnerability
emerges. Meanwhile, foreign exchange reserves have reached a record level of about $432 billion at end-
December 2017, well above prudent norms.


a pick-up in growth to between 7 and 7.5 percent in 2018-19 can be
forecasted, re-instating India as the world’s fastest growing major economy. This forecast is subject to
upside potential and downside risks.
• The biggest source of upside potential will be exports. If the relationship between India’s exports and
world growth returns to that in the boom phase, then that could add another ½ percentage point to
growth.
• Another key determinant of growth will be the implementation of the IBC process. Here timelines
in resolution and acceptance of the IBC solutions must be a priority to kick-start private investment.
• Persistently high oil prices (at current levels) remain a key risk. They would affect inflation, the
current account, the fiscal position and growth, and force macro-economic policies to be tighter than
otherwise.


ECONOMICS CLASS 9TH
http://www.easybiologyclass.com/difference-between-intercropping-and-mixed-cropping-comparison-table/- intercropping and mixed cropping

social equality of better -off people in better surroundings. Social exclusion can be both a cause as well as a consequence of poverty in the usual sense. Broadly, it is a process through which individuals or groups are excluded from facilities, benefits and opportunities that others (their “betters”) enjoy. A typical example is the working of the caste system in India in which people belonging to certain castes are excluded from equal opportunities. Social exclusion thus may lead to, but can cause more damage than, having a very lowincome.

Vulnerability to poverty is a measure, which describes the greater probability of certain communities (say, members of a backward caste) or individuals (such as a widow or a physically handicapped person) of becoming, or remaining, poor in the coming years. Vulnerability is determined by the options available to different communities for finding an alternative living in terms of assets, education, health and job opportunities. Further, it is analysed on the basis of the greater risks these groups face at the time of natural disasters (earthquakes, tsunami), terrorism etc. Additional analysis is made of their social and economic ability to handle these risks. In fact, vulnerability describes the greater probability of being more adversely affected than other people when bad time comes for everybody, whether a flood or an earthquake or simply a fall in the availability of jobs!

The sample surveys for determining the poverty line is done by NSSO which is under ministry of statistics and implementation
Causes of poverty
1) British colonial policies
2) Income inequalities
3) Social factors

Poverty profile of india- http://www.worldbank.org/en/news/infographic/2016/05/27/india-s-poverty-profile

FOOD SECURITY

The 1995 World Food Summit declared,“Food security at the individual, household, regional, national and global levels exists when all people, at all times, have physical and economic access to sufficient, safe and nutritious food to meet their dietary needs and food preferences for an active and healthy life” (FAO, 1996,
p.3). The declaration further recognizes that “poverty eradication is essential to improve access to food”.

What is food security?
Food is as essential for living as air is for
breathing. But food security means
something more than getting two square
meals. Food security has following
dimensions

(a) availability of food means food
production within the country, food
imports and the previous years stock
stored in government granaries.
(b) accessibility means food is within reach
of every person.
(c) affordability implies that an individual
has enough money to buy sufficient,
safe and nutritious food to meet one's
dietary needs.

Hunger is another aspect indicating
food insecurity. Hunger is not just an
expression of poverty, it brings about
poverty. The attainment of food security
therefore involves eliminating current
hunger and reducing the risks of future
hunger. Hunger has chronic and seasonal
dimensions. Chronic hunger is a
consequence of diets persistently
inadequate in terms of quantity and/or
quality. Poor people suffer from chronic
hunger because of their very low income
and in turn inability to buy food even for
survival. Seasonal hunger is related to
cycles of food growing and harvesting. This
is prevalent in rural areas because of the
seasonal nature of agricultural activities
and in urban areas because of the casual
labour, e.g., there is less work for casual
construction labour during the rainy
season. This type of hunger exists when
a person is unable to get work for the
entire year.