But this measure is centred around the immediate past. There are long-term influences also, like skill development in terms of acceptance of new technology that help enrich the human capital, for which among the imperatives comes the health care. Indian masses suffer from acute deprivation. Affordability is today at bottom level. The falling rank has brought to light that challenges are also results of long-term evasion of glaring issues that have been coming up ever since the present regime has assumed power.

There is steep fall in manufacturing sector while the rural growth has also been slow and in distress. Farmers are committing suicides. The reported unemployment rate has plunged to 7.1 percent during the last quarter of the previous year with urban youth having its share at 23.4 percent.

There is growing tendency of job cuts that has brought down the industrial output to 1.1 percent. Signalling a grave economic concern the downturn has been deep and frustrating. According to data released by ministry of statistics, the fall in manufacturing has been 1.2 percent while in electricity it is even less to 0.1 percent. The mining output has also come down to 0.1 percent. Country’s eight infrastructure sectors, that form 40 percent of the index of industrial production, shrunk by 0.5 percent.

Capacity utilization in the manufacturing sector, according to the findings of the RBI, declined to 73.3 percent from 78.1 percent in the previous quarter. The factors responsible for the decline has been reported as absence of orders, shrinking production, lower capacity utilization, and fall in profit margin in the surveyed sector. The commercial sector that does not include manufacturing, transportation and agrarian sector, has a fund flow that has declined by 88 percent as RBI has brought out in its report.

With all its disastrous effects, fall in GDP growth rate is not related with shrinking financial markets and its effects alone but also with the real economy that is lack of jobs that sustain the common masses, and the resultant impoverishment. In our country, the sectors that contribute in the progress of economy are generally identified as the organised sector as well as that of unorganised, in which the service sector forms 50 percent, and the industry 25 percent and agriculture 19 percent. Despite its smaller share, agriculture provides the large share of employment, 48.5 percent of total share. But this sector has been in the unorganised sector, and opportunities are usually available to the small and medium farmers and the land labour. In industrial sector too, the jobs are provided only to 11 percent, without the inclusion of present crisis.

However, despite its own grimness, economy is not facing glut alone. The role of the fall in growth leads to slowdown which is a feature that finds ways to enter and erode any industry. But when slowdown runs into the entire economy and that too for a long time, recession finds its ways to enter, and one of its results is glut. In its turn, it is caused by the financialisation that becomes active at a very large scale, and causes sharp fall in capital investment, in industry as a whole.

One indicator is slowdown that grips the entire process with GDP rate falling. Productive economy suffers even more since capital investment becomes scarce. The entire available capital makes its way into stock market, instead of going into infrastructure development, which creates conditions for manufacturing. In this context, evolves properties like real estate, landed properties, house construction, that generate fast money. Capital gets trapped in such investments while manufacturing suffers from lack of resources.

As the glut moves towards taking up the reigns of economy, recession sets in. To get rid of the crisis before it sets in, there is only one alternative, to bring back the capital into productive sphere. But the process was stalled by demonetisation, and that too not without purpose. (IPA Service)