PRESENT ECONOMIC SITUATION IN INDIA

Abstract

A well-documented analysis of the deepening economic crisis, highlighting its impact on the toiling people of India.

The Indian economy has been experiencing a creeping paralysis for the last so many years. The situation tends to be temporarily relieved by a sudden favourable monsoon which increases agricultural and food production. But in recent years the capacity of agrarian production to offer resilience to the economy, to offer a temporary increased market to industry is going down and a permanent crisis of recession, over-produc-tion, euphemistically called under-utilisation of production capacity, has set in.

All the weaknesses of the capitalist path-the contradictions of building capitalism in an under-developed country in the period of decay of capitalism-in alliance with landlord. interests, in co-operation with imperialism and in collaboration with foreign monopolists--have burst forth in the sharpest form. These were hastened and accentuated by the pillaging process of public finance-deficit financing and high taxation-a process which gathered an uncontrolled momentum in the last three or four years. This combined with the strong dependence on the Western capitalist countries, shaken by wild inflation and economic crises, led in India to wild inflationary price spiral combined with widespread recession all over the economy. Notwithstanding the kudos from the World Bank and the self-advertisement of Indira Gandhi and her sycophants, the economy is still deep in the rut of recession, unable to solve the problems of the market, organise its expansion and utilise the full capacity in consumer goods as well as in means of production.