Problems of Indian Economy.

There are many problems faced by the Indian economy, here are a few..

Population Growth:

India population is growing 14% per decade, leading to problems that include food deficits, pollution and unemployment.The living standards of most citizens are not changing. Over 30% of population are living below the international poverty line.


Poor Infrastructure:

Expansion of Public transportation , roadways, railways, waterways and sea ports have not met with population growth and led to poor industrial growth, agricultural growth. The government failed to invest in the infrastructure leading to poor performance of many sectors. Land acquisitions and funding constraints are major problems in Indian infrastructure.


Poor educational standards:

India has by far the largest population of illiterate adults at 285 million.Many children do not attend school at all and instead begin working before reaching their teen years.One of the primary reasons for dismal literacy rates is inadequate school facilities. The Sarva Shiksha Abhiyan programme is badly implemented by the government and failed to generate a mass consensus and also accused of high level of corruption with respect to the allocation of funds by the government to education.


Fiscal deficit:

India’s fiscal deficit is among the highest in G20 countries.The large increase in public debt involving large interest payments year after year will badly affect economic growth through reducing investing resources for spending on infrastructure and social sectors(education, health, housing).Fiscal deficit and associated borrowing is good as long as it is used for increasing public investment in physical infrastructure, education and health of the people. Even foreign investment depends on our success in improving infrastructure.

Higher NPA’s (Non-Performing Assets) :

Indian bank’s total bad loans are near to Rs 6 trillion. Nearly 90 per cent of this is of public-sector banks.The NPAs have been adversely affecting the banking system in the country.If left unattended, the NPAs possess the potential to drive the Indian economy to a bottomless chasm at some point.This scenario is likely to lead to a crisis situation in the banking sector, especially public sector banks (PSBs), if these banks fail to find sufficient capital to refill.



Inflation is inversely proportional to currency strength. India is failing to meet its target inflation rate every year. In our country while growth is slowing, inflation remains at a high level.


The public health system is poorly maintained by the government.India still spends only around 4.2% of its national GDP towards healthcare goods and services (compared to 18% by the US). The private healthcare sector is responsible for the majority of healthcare in India. Most healthcare expenses are paid out of pocket by patients and their families.Clean drinking water is in short supply. Sanitation is a massive ongoing problem that the government has been unable to address.India’s health care infrastructure is also terrible, ranking 112th of 190 countries. More than 70% of the population has limited or no access to health care. In India shortage of medical personnel like doctors, a nurse etc is also a basic problem in the health sector.


Even High school kids knows about the level of corruption in India.

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