Development or growth paradigm differ hugely on account of myriad Political, Societal and Economic norms.. Further, reports revealed that, Indian economy will expand at 7.4% in this year, but the growth will slow down to 7.3% in the 2019 as domestic demand tapers on higher borrowing costs due to rising interest rates, Moody's Investors Service (MIS). The report, namely, ‘Global Macro Outlook 2019-20’, Moody's mentioned the economy grew 7.9% in the first half (January-June) of 2018, which reflects post demonetisation base effect..
Although, 'Development Discourse' in India has undergone huge change in the wake of demonetisation, GST, PSU bank recapitalisation, Air India Privatisation etc. Now It is no longer a exercise which can be carried out merely by the government of the day in terms of infrastructure and tangible notion but at the same time it is a conceptualisation of human freedom that enable him/her to attain the highest possible goals through democratic means.
The report, however, Stating that borrowing costs have already increased on higher interest rates, the United State based agency has argued that, it expects the Reserve Bank of India (RBI) will continue to steadily raise the benchmark rate by 2019, which will further dampen domestic demand. These factors will limit the pace of the economy's growth over the next few years, with real GDP growth of 7.3% in 2019 & 2020, from around 7.4 percent in 2018, Moody's mentioned.
“This will weigh on the global trade growth and will reshape trade flows and supply chains,” Moody's.
Following the reports, The largest downside risk to India's growth future stem from concerns about its financial sector. While the impact of higher global oil prices compounded by sharp rupee depreciation raises the cost of households' consumption basket, and will weigh on households' capacity for other expenditures. Borrowing costs have already risen because of tightening monetary policy, it argued.
In the short term while measures to stabilise the financial sector are put in place, credit growth is likely to slow. Downside risks from a prolonged liquidity squeeze for non-bank financial institutions, which could lead to a sharper slowdown in their credit provision, remain. The report. Moody's said global economic growth will slow in 2019 and 2020 to a little under 2.9% from an estimated 3.3% in 2018 and 2017. It expects trade and geopolitical frictions between the U.S. and China to persist for some time, Moody's.
Despite all of above, The rapid growth has been both "sustainable and inclusive" but it pose formidable challenges for existing economic framework in India. Also the process of urbanisation can be carried out by creating additional space for them who are yet to become the part of said process. Redistribution of resources and people has to be their in order to make our country more equitable that can be done only when there is a equal amount of share between rural, urban as well as peri-urban.