Economy Of Indian States

[Dot Liljenquist]

TheIndus Valley civilization, one of the world's oldest, flourished during the 3rd and 2nd millennia B.C. and extended into northwestern India. Aryan tribes from the northwest infiltrated the Indian subcontinent about 1500 B.C.; their merger with the earlier Dravidian inhabitants created the classical Indian culture. The Maurya Empire of the 4th and 3rd centuries B.C. -- which reached its zenith under ASHOKA -- united much of South Asia. The Gupta dynasty (4th to 6th centuries A.D.) ushered in The Golden Age, which saw a flowering of Indian science, art, and culture. Islam spread across the subcontinent over a period of 700 years. In the 10th and 11th centuries, Turks and Afghans invaded India and established the Delhi Sultanate. In the early 16th century, the Emperor BABUR established the Mughal Dynasty, which ruled large sections of India for more than three centuries. European explorers began establishing footholds in India during the 16th century.

By the 19th century, Great Britain had become the dominant political power on the subcontinent, and India was seen as the "Jewel in the Crown" of the British Empire. The British Indian Army played a vital role in both World Wars. Years of nonviolent resistance to British rule, led by Mohandas GANDHI and Jawaharlal NEHRU, eventually resulted in Indian independence in 1947. Large-scale communal violence took place before and after the subcontinent partition into two separate states -- India and Pakistan. The neighboring countries have fought three wars since independence, the last of which was in 1971 and resulted in East Pakistan becoming the separate nation of Bangladesh. India's nuclear weapons tests in 1998 emboldened Pakistan to conduct its own tests that same year. In 2008, terrorists originating from Pakistan conducted a series of coordinated attacks in Mumbai, India's financial capital. India's economic growth after economic reforms in 1991, a massive youth population, and a strategic geographic location have contributed to the country's emergence as a regional and global power. However, India still faces pressing problems such as extensive poverty, widespread corruption, and environmental degradation, and its restrictive business climate challenges economic growth expectations.

with the notable exception of the deserts in the northwest, including the Thar Desert, and the mountain fringe in the north, a very high population density exists throughout most of the country; the core of the population is in the north along the banks of the Ganges, with other river valleys and southern coastal areas also having large population concentrations

deforestation; soil erosion; overgrazing; desertification; air pollution from industrial effluents and vehicle emissions; water pollution from raw sewage and runoff of agricultural pesticides; tap water is not potable throughout the country; huge and growing population is overstraining natural resources; preservation and quality of forests; biodiversity loss

history: previous 1935 (preindependence); latest draft completed 4 November 1949, adopted 26 November 1949, effective 26 January 1950

amendments: proposed by either the Council of States or the House of the People; passage requires majority participation of the total membership in each house and at least two-thirds majority of voting members of each house, followed by assent of the president of India; proposed amendments to the constitutional amendment procedures also must be ratified by at least one half of the India state legislatures before presidential assent; amended many times, last in 2023

Aam Aadmi Party or AAP [Arvind KEJRIWAL]

All India Trinamool Congress or AITC [Mamata BANERJEE]

Bahujan Samaj Party or BSP [MAYAWATI]

Bharatiya Janata Party or BJP [Jagat Prakash NADDA]

Biju Janata Dal or BJD [Naveen PATNAIK]

Communist Party of India-Marxist or CPI(M) [Sitaram YECHURY]

Dravida Munnetra Khazhagam [Muthuvel Karunanidhi STALIN]

Indian National Congress or INC [Mallikarjun KHARGE]

Nationalist Congress Party or NCP [Sharad PAWAR]

Rashtriya Janata Dal or RJD [Lalu Prasad YADAV]

Samajwadi Party or SP [Akhilesh YADAV]

Shiromani Akali Dal or SAD [Sukhbir Singh BADAL]

Shiv Sena or SS [Uddhav THACKERAY]

Telegana Rashtra Samithi or TRS [K. Chandrashekar RAO]

Telugu Desam Party or TDP [N. Chandrababu NAIDU]

YSR Congress or YSRCP or YCP [Y.S. Jaganmohan REDDY]

three equal horizontal bands of saffron (subdued orange) (top), white, and green, with a blue chakra (24-spoked wheel) centered in the white band; saffron represents courage, sacrifice, and the spirit of renunciation; white signifies purity and truth; green stands for faith and fertility; the blue chakra symbolizes the wheel of life in movement and death in stagnation

note: similar to the flag of Niger, which has a small orange disk centered in the white band

the Lion Capital of Ashoka, which depicts four Asiatic lions standing back to back mounted on a circular abacus, is the official emblem; Bengal tiger; lotus flower; national colors: saffron, white, green

largest South Asian economy; still informal domestic economies; COVID-19 reversed both economic growth and poverty reduction; credit access weaknesses contributing to lower private consumption and inflation; new social and infrastructure equity efforts

Doordarshan, India's public TV network, has a monopoly on terrestrial broadcasting and operates about 20 national, regional, and local services; a large and increasing number of privately owned TV stations are distributed by cable and satellite service providers; in 2020, 130 million households paid for cable and satellite television across India and as of 2018, cable and satellite TV offered over 850 TV channels; government controls AM radio with All India Radio operating domestic and external networks; news broadcasts via radio are limited to the All India Radio Network; since 2000, privately owned FM stations have been permitted and their numbers have increased rapidly (2020)

the majority of the military's inventory consists of Russian- and Soviet-origin equipment; there is a smaller, but growing mix of Western and domestically produced arms; Russia continues to be the leading provider of arms to India, although in recent years India has increased acquisitions from other suppliers, including France, Israel, and the US; it is one of the world's largest importers of arms; India's defense industry is capable of producing a range of air, land, missile, and naval weapons systems for both domestic use and export; it also produces weapons systems under license (2023)

India is a source, transit, and destination for illicit narcotics and precursor chemicals; drug abuse in India growing, facilitated by illicit narcotics and the availability of over-the-counter medicines; commonly abused substances in India include heroin, cannabis, and cocaine, with growing use of pharmaceutical drugs in recent years including tramadol, opioids, and MDMA (ecstasy) analogues; largest producer of generic drugs in the world which is also used to produce illicit synthetic drugs such as pharmaceutical opioids, methamphetamine, heroin, MDMA, and ketamine

Factors such as human capital formation and knowledge creation in the form of research and innovation are widely acknowledged as essential components of a knowledge economy with international and internal migration dynamics that lead to external resources in the form of remittances and greater investment productivity; these help achieve greater competitiveness and comprise productive public expenditures that generate long-run economic growth.Footnote 3 With a view to refine the existing ideas and advance new theories, some later economists additionally accredited the significant role of institutions as a determinant of cross-country long-run growth. They explored how institutions affect the decisions of economic agents, and whether differences in economic growth can be explained by differences in institutional quality across economies (North 1986).

Institutional economists should investigate the implications of rules or norms on the enforcement of property rights and contracts, and their analyses should be based on political process models (North, 1986). Acemoglu et al. (2005) believed that political institutions and resource distribution affect economic outcomes through economic institutions. Political institutions include the form of government, constraints on political leaders, other power-holding elite groups and the demarcation of power among different organs of the government, whereas economic institutions mainly include property rights and contract enforcement. Political institutions shape political incentives and separation of powers, whereas economic institutions and policy enforcement affect economic outcomes through incentive mechanisms and by improving the consistency in decision-making processes of various economic actors (North 1991; Acemoglu et al. 2005).Footnote 4 Besely and Ghatak (2010) emphasized four principal channels whereby secure property right produces better economic outcomes and thereby promotes the efficiency in a market-based economy.Footnote 5

Besides property rights, contract enforcement is also an important part of the economic institution that supports a flourishing market economy. Market-based production requires a developed capital market to finance fixed investment in equipment and tools, trained labor, a developed transportation system, and a market for inputs and outputs. A robust contract enforcement system seamlessly coordinates and decreases the costs associated with economic transactions. The decrease in costs associated with transactions helps economic agents realize the benefits of mutual cooperation, despite their physical distance. A specific region may have an informal contract enforcement mechanism that facilitates transactions among economic agents; however, the costs due to informality can exceed their benefits. Banerjee (2001) documented the informal money-lending system in India, wherein the contracts between borrowers and lenders are enforced through an informal system. Because of high associated transaction costs, the rates of interest charged on loans are exorbitant and that act as a deterrent for the poor availing the loans. Even they receive the amount in the current period, it imposes substantial future obligations on them.

3a8082e126