With the Global recession nearing after the geopolitical crisis and continuous rise in prices and short supply of energy and fuel.
Major- Namrata Dhasmana
The only way emerging economies can survive and stand tall is by improving their capability building. In the changing times, where till a few years back we were a globalizing business, today as an emerging economy we have started to Act Local and Think Global to be Super Power in resources and economically.
ADVERTISEMENT
With a global hike in fuel prices, India has only raised it by 2%. As a young and emerging economy, India is all set with its initiative of “Make In India” and booming Entrepreneurship to improve economic strength. Where we have witnessed major shifts in the defense and manufacturing sector.
Yet, the Indian Economy has its unique challenges. Being 5th largest economy with a major segment of the middle class and an unorganized economy, the resilient Indian economy will have to surpass some basic challenges to see noticeable shifts. The importance of microeconomics and its major determinants as organizations and people plays a pivotal role in an emerging economy like India.
Challenges of India
The Indian industry has seen a rise in entrepreneurship. Although we reached a landmark of 100 unicorn start-ups with a valuation of more than $300 billion. Primarily the Indian economy is domesticated and unorganized which reflects stability, yet weakening growth. It is important to improve economic strength because the unorganized economy fears cost-push inflation. The vivid diversity of India and the rising gaps between the rich and middle segments of society push the biggest dark gap in economic recovery. What matters most in this is how determinants of microeconomics play in the market.
Understanding Micro Economics in India
India has a diversity of cultures with varied salaried employees and mostly either agro-based or unorganized wage earners. With this diversity in India’s market and industry, behavior varies from the west. The major determinants of the micro economy of India are people and organizations. Business in the emerging economy at a strategic level green shoots with the actions taken by the government. The negative sentiments of microeconomics reflect the scarcity of cost of production and consumption of goods and services. With these challenges and inflations rising high with rising in the price of food, the Indian economy has to thrive hard to meet up the diversity of the population. The comparison of the Indian economy with the west fixes only the strategic level issues. The major segment of India spends its income on food. The Inflation has risen from 7 to 7.30 and is at its peak since May 2022. Analysts have mixed opinions of the price rise and the major contributor is the biases in prices.
The weakening of India’s Rupee is also a major concern for increasing the gap between the rich and middle segments. As per the separate Reuters Poll of FX analysts, the rupee is expected to be declining in short term for the next 6 months. The increase in exports and inflow of foreign currency will also not have much or maybe a moderate impact on the global economy due to the global recession.
The irony of India is instead of being a Global Leader and having strategic-level initiatives, the nifty as a benchmark might be slightly marginalized and the optimism of recovery and GDP growth will be moderate. In consequence, it is far more imperative to do capability building and change the responsibility of the robust organizations toward India to improve the sentiments and purchasing capability of people to balance consumption, supply, and production of goods and services.
Major Namrata Dhasmana is a Socio-Economic Analyst and Columnist. She is a Keynote speaker and Motivational Speaker. She can be reached at
Subscribe today by clicking the link and stay updated with the latest news!" Click here!
