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Special Centennial Issue

No. 406

January 2022

Vol. CII (Part-III)

ISSN: 0019-5170


Dynamics of Fiscal Imbalance in India: Relative Roles of Political and Economic Cycles

D. K. Srivastava1
Sumedha Pandey2
Muralikrishna Bharadwaj3

Two primary motivations that induce governments to incur periodically higher than average fiscal imbalances relate to political and economic cycles. The evolution of fiscal imbalances in India over the period 1950-51 to 2021-22 can be explained in terms of the impact of both these motivations. The resultant outcome of periodically higher than average fiscal deficits has been a progressive increase in the level of government debt-GDP ratio in India. Each cycle, whether political or economic, can be divided into two phases, (a) expansionary phase and (b) contractionary phase. If the upsurges in the fiscal imbalance in the expansionary phase are higher on average than the reductions in the contractionary phase, the resultant would be a continuing increase in the outstanding debt-GDP ratio subject to the relative dynamics of growth and interest rates. In this paper, we have divided the overall period under study into three phases. Phase 1: 1950-51 to 1975-76, Phase 2: 1976-77 to 2007-08 and Phase 3: 2008-09 to 2021-22. We find that outstanding debt in India has continued to rise because of three factors:(i) continued fiscal imbalance due to the political motive, which was dominant in Phases 1 and 2, although partially curbed after the enactment of the FRBM, (ii) continued fiscal imbalance due to the economic cycle motive which is justified even by the FRBM and was witnessed during major global crises of 2008 and 2021 and (iii) asymmetry in the magnitude of fiscal imbalance in the slowdown and expansionary phases of the economic cycles. It is as a result of the persistence of these factors that the post Covid combined debt-GDP ratio of the central and state governments has increased to close to 90%, calling for a revised fiscal responsibility framework and concerted effort to undertake corrective action.

Keywords: Political cycles, economic cycles, fiscal deficit, government debt.

JEL Codes: H0, H1, H3, H6, E62 and E63

  1. Chief Policy Advisor, EY LLP India, Gurgaon, Haryana – 122002. E-mail:,
  2. (Corresponding author) Assistant Professor, CMP Degree Collage, Allahabad, Uttar Pradesh – 211002.
  3. Senior Manager, EY LLP India, Gurgaon, Haryana – 122002. E-mail:,
    Acknowledgements: The authors acknowledge valuable inputs provided Ms. Ragini Trehan

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Doubling Farmers Income by 2022: A Case Study of Paddy and Banana farmers in Sreekrishnapuram-1 Village, Palakkad District-Kerala

Aparna Girish*1
Pesala Peter2
I. Maruthi3

Over the years, India has transformed from the condition of food deficiency to a self-sufficient country. Now it is high time that the focus be shifted to improving the livelihood of the farmers of the country and help them relish the fruits of their labor. The Union Budget 2016-17 had stated that an important objective of the Government is to double the income of farmers by the year 2022.The study is pertaining to the village called Sreekrishnapuram-1 in the Palakkad district of Kerala and based on a primary survey of paddy and banana farmers of the village. The area, production, productivity, cost of cultivation and net income of the paddy and banana farmers in the village has been analyzed for the years 2016, 2017, 2018 and 2022.The paper also looks into the socioeconomic characteristics and land particulars of the farmers in the village. While the possibility of doubling net income of paddy famers is low, it is expected that the banana farmers be able to double their net income by 2022.The views of farmers about the extent of effectiveness of each of the strategies suggested by previous studies and previously implemented programmes in the context of doubling of income has been documented to have a profound understanding of the situation persisting in Kerala and prepare a roadmap therein.

Keywords: Paddy and Banana farmers, doubling farmers’ income by 2022 and village study.
  1. ADRTC, ISEC, Nagarabhavi, Bengaluru-560 072
  2. Consultant in ADRTC, Institute for Social and Economic Change (ISEC), Nagarabhavi, Bengaluru-560 072; and corresponding author email:
  3. Professor, ADRTC, ISEC, Nagarabhavi, Bengaluru-560 072

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Varying Profitability and Determinants of Gram Crop Using Cost of Cultivation Data: A Fixed Effect Approach

Amit Mandal1

The present paper attempts to find out the gap between different cost and gross value of output (GVO), dynamics of the inputs use and important indicators for gross value of output of gram crop across major producing states during 2004-05 to 2014-15. The results corroborate that there has been a sharp increase in GVO and total cost for all the states after 2009-10. It was found that the rapid increase in operational cost from 2009-10 was due to the introduction of farm waiver scheme by Government of India in 2008-09. It was also evident that the compound annual growth rate is higher during 2009-10 to 2014-15 when compared during 2004-05 to 2007-08. The magnitude of profit in Madhya Pradesh and Rajasthan was impressive showing the positive trend over cost. There are no evidences that show that the high productive regions have used their inputs efficiently. It was observed from the fixed effect regression analysis that efficiency of different inputs are not same for gram crops. It was revealed that the irrigation cost and pesticides cost are not significant while total labour cost seems to have been used efficiently and significantly across the states for gram cultivation over the time period.

Keywords : gross value of output, costs, CACP, fixed effect regression model.
Jel Classification : Q00, Q11, Q15
  1. Assistant Professor in Economics, Mankar College under the University of Burdwan, Mankar, West Bengal. E-mail:

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Demonetisation and Growth of Retail Digital Payment of India

Laxmidhar Samal1

Payment and settlement are the backbones of every economic system. With the objective of making available retail electronic payment to all at an affordable price with innovative product variants and thereby shifting the economy from cash denominated to digital, National Payment Corporation of India (NPCI) was established in December 2008. It was established as an umbrella organisation for all kinds of retail payment and settlement under the initiative of RBI and the Indian Banks’ association. Further, on 8th November 2016 Government of India announced demonetisation banning the high denominated currency notes of ₹500 and ₹200 which constitutes 86.9 percent of the total value of the currency notes in circulation with the primary objective of curbing black money and secondly to encourage the digital economy.

In light of the above facts, this paper analyses the growth of retail electronic payments in India from 2004-05 to 2018-19 and critically evaluates the impact of demonetisation on retail electronic payments. To study the growth rate the paper uses the log-lin model and by studying the impact of demonetisation Welch's two samples mean equality t-test is employed.

Keywords : NPCI, Demonetisation, NEFT, IMPS, Retail Electronic Payment.

  1. Lecturer in Commerce, P.G. Department of Commerce, Baba Bhairabananda Autonomous Mahavidyalaya, Chandikhole, Jajpur, Odisha, PIN- 755044. Email-

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The Sustainable Development Goals 2030 –Agenda:3 and Health Expenditure in India

Soni Singh1
Anjali Singh2

UN agenda for the sustainable development were resolved in September 2015, a set of 17 goals to be achieved till 2030. India is one of the 169 countries to be committed to achieve the above said targets. UN Goals 2030 are unprecedented partnership to achieve peace and prosperity for humanity and planet. “The Sustainable development goals are a collection of 17 global goals designed to be a blueprint to achieve a better and more sustainable future for all.”

The centre of focus of UN agenda is human, as Goal: One is to End poverty in all its forms everywhere is tended to eradicate poverty for all people everywhere. The second Goal is to End hunger, whereas the health is the third target of the above said agenda. Health is a core issue of the sustainable development Goal-3 aims to “Ensure healthy lives and promote wellbeing for all at all ages”. The Sustainable Development Goal-3 is a multifaceted and universal objective on which human development policies of nation may propose future plans.

In this paper the focus of researcher is to study the goal – 3 that is to be achieved till 2030, by all the 169 member countries. To examine India’s health expenditure in view of Goal-3 is also an objective of this paper. The researcher shall also look into the strategies of the Indian States in relation with Goal-3.The magnitude of this paper is to study the achievement of Indian states in reducing maternal mortality ratio and neonatal mortality rate.

Keywords- Sustainable Development Goals (SDG), Maternal Mortality Ratio (MMR), Infant Mortality Ratio (IMR), Neo-Natal Mortality Ratio(NMR), Health Expenditure (HE).

  1. Research Scholar, Department of Economics, Dr. Shakuntala Misra National Rehabilitation University, Lucknow.
  2. Assistant Professor, Department of Economics, Dr. Shakuntala Misra National Rehabilitation University, Lucknow

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College Education in India: A Survey Through NIRF Lens

Sanjoy De1
Atanu Sengupta 2

The paper tries to examine the performances of undergraduate colleges in India from inequality and efficiency perspective. For this, it uses the recently published NIRF data. A significantly high concentration of top colleges in only a few districts is observed. This reflects a severe lack of opportunities in quality education in the country which viciously impede the development of human capital. Also, the high inequality index shown for the parameter ‘Perception’, puts question mark to the inclusion of any subjective parameter in the determination of ranks. The ranks prepared on the basis of resource use pattern diverge a lot from the NIRF ranking. There is huge upheavals and upsurge in the ranking based on data envelopment analysis, indicating gross disagreement. The Kendall‟s tau test testifies this discordance.

Keywords: NIRF Ranking, College Education in India, Rank Consistency, Efficiency Analysis, Kendall’s tau, data efficiency analysis.

JEL Classification: I21, I23, I24, C40, D24

  1. Assistant Professor, Department of Economics, Shyampur Siddheswari Mahavidyalaya, University of Calcutta, West Bengal, India E-mail:
  2. Professor, Department of Economics, Burdwan University, Burdwan, West Bengal, India. E-mail:

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Urbanisation and Migration in India during 1991-2011: An Inter-State Analysis

Pritha Kundu1
Pranakrishna Pal2

Urbanisation is the process by which more and more people leave the rural area and live in cities and towns. Urbanisation depends on several factors. These are: a) natural increase of population b) net rural to urban migration c)relocation of rural settlements in urban areas and d) the emergence of new points of concentration. India has been experiencing the rapid urbanization flow from rural to urban migration. The important push factors of migration are, famine, drought, poor living conditions, low agricultural productivity, poor medical care and unemployment on the other hand the important pull factor of migration are Employment opportunity, higher income, education, urban facilities, security and quality of life. Present study has estimated inter-state and intra-state net migrants and the reason behind migration during 1991-2011. Using regression technique, positive relations between urbanpopulation and net-migrants have been established i.e. with the increase in the net flow of rural to urban migrants the urban-population always increases, irrespective of sex.

Keywords: Urbanization, In-Migrants, Out-Migrants, Net- Migrants, Reasons for Migration.

Jel Codes: C01,O18, P25, R11, R23

  1. Research Scholar, Dept of Economics, Rabindra Bharati University, 19/3 Narasingha Dutta Road, Kadamtala, Howrah, Pin-711101. Email:
  2. Professor, Department of Economics, Rabindra Bharati University, B-1/109, Kalyani, PO-Nadia, Pin-741235. Email:

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Determinants of FDI Inflow in India

Digvijay Singh1
Sunil Kumar Niranjan2

Foreign Direct Investment (FDI) plays a crucial role in economic development and growth. In this research paper, the researcher examines the basic determinants of FDI and how these factors affecting foreign investment inflow in India. In this paper, Inward FDI is a dependent variable whereas GDP size, Trade openness, Exchange Rate, Stock Exchange index are taken as independent variables. This study has used time-series data and the Augmented Dickey- Fuller test used for determining the stationarity of the data. In this study, the researcher concludes that the size of the GDP is the most important determinant that attracting foreign Direct Investment in India.

Keywords: FDI, FPI, Exchange Rate, Stock Exchange Index, Trade openness.

  1. Assistant Professor & Research Scholar, Department of Economics, M.B.P. Govt. P.G. College Ashiyana, Lucknow. Email:
  2. Assistant Professor & Research Guide, Department of Economics, M.B.P Govt. P.G., College Ashiyana, Lucknow. Email:

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A comparative Sector-Wise Assessment of Exports from India to Japan Under Comprehensive Economic Partnership Agreement

Areej Aftab Siddiqui1

In recent years, Southeast Asia has emerged as a major hub for manufacturing and has resulted in trade agreements and economic partnerships which have been found to have positive relationships with trade and investment. In 2011, Comprehensive Economic Partnership Agreement (CEPA) was signed between India and Japan with an anticipation to enhance trade between the two nations. In the present study, this trade agreement has been analysed to study the macro and sector-specific impact of India’s exports to Japan from 2007 to 2016. The sectors selected for the analysis are Minerals Oils, Chemicals, Vehicles and Machinery. The results indicate that CEPA is beneficial for Indian exports as a whole and also for all the sectors except Mineral Oils chosen in the study.

JEL Codes: F01, F14, F62

Keywords:: Economic Partnerships, Trade Agreements, Comparative analysis, exports.

  1. Indian Institute of Foreign Trade, New Delhi, India E-mail:

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Imposition Times and Plight of Inter-State Migrant Labourers from Assam

Pradyut Guha1

Present study made an attempt to assess the regional differences in distress among inter-state migrant labourers from Assam following nationwide full lockdown during initial phase of pandemic outbreak in India. The analysis of data confirmed regional differences in economic distress among the labourers with labourers immigrated to Maharashtra and Kerala were the worst sufferers relative to those in the rest of Indian states. The economic distress was higher among the elderly labourers with additional days of lockdown added to their agony. Steps towards strict monitoring of public initiatives/programs at the grass root level are necessary in addressing the imperfections in allocation of resources and help the needy in times of health/national emergencies.

Keywords: Unemployment, income los, regional.

JEL Classification: J610, E320

  1. Assistant Professor, Department of Economics, Sikkim University (A Central University Established by the Act of Parliament), 6th Mile, Samdur, P. O: Tadong-737102, Gangtok, Sikkim (India). Email:

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