Describe the reasons for the slow down of economic growth.
Answers
Explanation:
Economic growth is the increase in the goods and services produced by economy over time.
It is indicated by increasing GDP(Gross domestic Product)
So, what are the reasons for the present slowdown in the Indian Economy? To start with, private consumption has taken a beating due to Demonetization as consumers suddenly prefer to hoard cash or keep it in the bank instead of spending on consumer goods.
Moreover, demand has also collapsed in the rural areas as the entire rural economy runs on cash and Demonetization led to the loss of jobs as well as incomes thereby squeezing the rural consumer who now prefers to wait and watch as well as postpone consumption except that of essential goods and services.
2)Indeed, Demonetization can be said to have contributed too much of the slowdown as the Double Whammy of demand collapsing, and supply bottlenecks mean that there is a broad slowdown across the entire value chain of the demand and supply dynamics.
Thus, what we have is a situation wherein cash has dried up leading to a slowdown in the economy.
#the fact that the rollout of the GST or the Goods and Services Tax on a nationwide basis has led to the slowdown cannot be denied.
Indeed, GST has hampered the small businesses more than Demonetization by forcing them to withhold inventory until they migrate to the GSTN or the GST Network and become compliant with the numerous rules and regulations that are part of this tax.
It can be said that the implementation of GST is also flawed thereby exacerbating some of the factors that have contributed to the slowdown.