How do we define an economy?
We all have visited our neighbourhood markets, where we see many people selling goods (e.g. vegetables, books, clothes, etc.) or services (bicycle repair, haircuts, etc.) to us in exchange for a sum of money.
The buying and selling of goods/ services and the money transactions that occur between the buyers and sellers are what form an economy.
A nation’s economy involves the government, businesses, households, and foreign nations. These four participants act as both buyers and sellers of different goods or services.
A nation’s economy experiences growth when it sells more than it buys.
What is the role of the International Monetary Fund?
The International Monetary Fund (IMF) was founded in the year 1944 at a United Nations conference. It has 190 member countries. It comes together to discuss matters like trade, economic growth, etc. It also lends money to countries whose economies are facing problems.
According to the IMF’s data, India has become the fifth-largest economy in the world.
How is economic growth good for a country?
When there is economic growth in a country, the government can earn more in taxes. This tax money is used by the government to give better public services, build roads, generate electricity, help the poor, and protect our borders.
Economic growth creates more jobs. When people have stable jobs, they can save and spend a lot of money. This will allow them to eat good food, live in big houses, send their children to good schools, maintain their health, etc.
It also helps reduce crime and makes our surroundings more peaceful and safe to live in. Economic growth is good for everyone.
What is the state of India’s economy and where is it heading?
India is the fifth-largest economy, based on the value of all goods and services it produces in a year. But based on how much money every person earns in a year, India still ranks very low. This means that some people have not benefited from our country’s economic growth.
But all hope is not lost! India is not just the fastest-growing major economy, but also the country with the most number of young people in the world.
If India focuses on teaching children well today, the benefits of economic growth will soon spread to all sections of Indian society.
