On the Sustainability of India’s Growth Rate
The performance of GDP and its sustainability in India largely depends on sustained growth of agricultural production. But agricultural production in India is subject to high volatility due to excessive dependence on monsoon and has also been witnessing a declining trend on account of non-availability of adequate institutional credit, and a decline in public sector capital formation in agriculture. Hence, the answer to ensuring sustainable growth rate of GDP lies to a large extent in ensuring faster and sustained growth in agriculture. For that, there is a need to increase the availability of bank loans to the small and marginal farmers at reasonable cost, increase public investment in infrastructure like irrigation, power, transport, and agricultural research so that the expected growth rate of 8-9 percent may become possible and also sustainable.