11 thoughts on “Indian Economy”

  1. According to Pricewaterhouse Cooper ( 2015 ) there is predominant use of cash in India for consumer payments relative to other nations. Watan Committee estimates that about 78 % of consumer transactions in India are cash based.

    Above findings raise an important question as to what extent “less cash model of economy” is feasible in Indian context ? Economic survey mentions that cash-lite model currently faces shortage of specific equipments like Point of Sale devices and low smartphone penetrations thus deepening digital divide further between affluents and poor ( including less affluents ). Affordability of smartphones and costly internet connections still a major concern in India. Despite of above shortcomings Economic survey also mentions present government’s proactive role in incentivizing digital transactions through initiatives like launch of BHIM App for smartphones, Aadhar-Enabled Payment System ( those who don’t have access to smartphones ) and Unified Payment Interface for enhancing interoperability. Bharatnet is another initiative that aims to target broadband connectivity to 2.5 lakhs Gram Panchayats in country which would give boost to Digital India Initiative of Government.

    To conclude digitalization is not a panacea nor is cash all bad. In a diverse country like India transformation towards cash-lite economy must be gradual and choice based rather than strictly controlled.

  2. Possible benefits of being a less cash economy in India is missing here. But, contents, language and analysis is up the mark. Good answer.

  3. The less cash model for the Indian economy is a necessity too much reliance on cash has allowed for graft and corruption to flourish as the hoarders of black money keep the money out of the system hawala and other means allowed them to circumvent legislations and avoid paying tax also carrying cash leaves one susceptible to theft and burglary etc soiled currency renders money useless in light of these conditions less cash economy is indeed useful. There’s a fair distance to go to make the current model viable development of apps and systems like uidai bhim upi etc is not sufficient a lot of indians need digital literacy to be able to use them , the second biggest problem with the current model is transaction costs people prefer cash as there are no transaction costs in e-payments and mobile wallets etc there is a transaction charge which makes it a less attractive option . The biggest fear that comes with cyber banking is cyber security to have a less cash economy we need to protect the privacy of customer and guard against data theft and financial fraud. Cash less economy has come a long way since demonetisation every research study has shown an increase in cashless transaction and positive effects include increased tax collection and revenue collection but to make the model sustainable work needs to be done to increase outreach improve digital literacy reduce costs and ensure security.

  4. First sentence is too long and vague. Avoid such practices. Further explanation is logical but seems to be completed in haste. Question has its both pros and cons and needs to be addressed properly. 4.5 marks.

  5. The less cash model of the Indian economy necessary but not as much as the govt. is advertising. There are claims that it will bring transparency in the system and the devil of black money wont even survive. But in reality independent economists claim that this is not possible. After the demonetization move by the govt. there was euphoria that less cash model is successful in curbing the illegal transactions, in reality there was no authentic claim by the govt it self. Accepting the fact that in less cash model every transaction will be in digital format and according to various committees constituted by govt. claim that the revenue generated through it will be twice that of now. At this moment of time when we consider our country’s financial literacy rate which is much lower than what it is expected to be, any over night shift towards the digitization can have unforeseen negative consequences. Which can even question the existence of the idea of digitization move. There were many instances where people were charged for using these digital payments. These kind of moves will restrain people from using digital payment stystem as they might feel punished. People from absolutely rural background don’t even feel using digital because of apprehension of losing money in transaction. Yes our country should be more advanced in using the technology for transactions, which is very simple in reality and people feel it comfortable when compared to conventional payment methods, above all govt will have a very good revenue for implementing social schemes. Govt’s move in introducing mobile apps like BHIM, UPI etc was applauded by public. But the move to make digital India over night was criticized equally.
    It is very encouraging, that govt started to think in more sophisticated way and started encouraging people to use the same. But no country has ever achieved 100% digitization even in gradual way. It is wrong to say that govt vision is wrong. To succeed in creating a less cash economy the process should be gradual with better understanding about society.

    1. Contents are sufficient. Starting line looks redundant. Flow of language and expression somewhere deviated.Ended on positive note is good sign.

  6. Cashless is the word that literally means no cash but in today’s world the word cashless refers to the digital form of payment instead of cash for payment of any kind of expenses or any kind of transaction .
    Introducing such concept in India has its own merits and demerits :
    Merits :
    1.Easy Portability :Advantages like easy to carry ,reduce threat of theft , no problem of change makes this concept convenient one
    2.Tracker for Fruadlent activities :
    Digitisation in transactions has become the means to track all the illegal transactions, black money etc as all the records are stored in the digital form making the process of recovery and reviewal easier and comfortable while in cash economy such benefits can’t be availed.
    3.Systematic Channel Provision : Digital form Of payment has provided with the organised channel for the transaction that is through banks and financial institutions which further aid in increase in the tax revenue for the government due to reduction in the illegal activities because of digitisation .
    But since there are many factors that influence economy similarly this concept of cashless economy when brought in Indian economy comes with some limitations . They are :
    1. Lack of knowledge : Such current concept is not that familiarised one with the Indian people where still the people are illiterate and poor .Therefore such a measure can’t fulfill the basic requirement of the inclusive participation . Lack of Proper infrastructure and education delays one’s consensus on the coming of cashless economy in India .
    2.Vulnerability factor : Though the digitisation has come with a simplified method but it also involves the risk factor like cyber fraud , hacking of bank accounts , loosing all hard money to online scams etc which prevents economy like India from achieving its goal as people are not that technology friendly in India owing to their lack or inadequate education .
    3. Transaction fee : The digital mode of pay,nets like credit card , online banking ,wallet payments etc involve the extra cost factor that becomes hindrance for its all over acceptance..
    Hence before introducing such novel measures in economy like India pre proper intellectual analysis need to be done such that the bottlenecks do not cause much hinderance thereafter .Implementing such measure in India with so many challenges require wise decisions .

    2.

  7. LessCash model of economy:
    The goverment took action of demonitisation to curb corruption,terror financing ,black money .It caused cash crunch and forced us to move towards electronic payement systems .We are shifting from cash cruch to less cash society.
    Advantages of cashless society are many folds ranging from curbing of black money by reducing tax evasion; promotion of transparenet economy by electronic and mobile payement system like e -wallet;mobiKwik; Paytm etc.It is most convientent mode of payment ,has lower risk ,also reducing cost of printing currency.there is
    decrease in crime rates like drugs trafficking ;financing of terrorism which are mostly done by cash only.
    However it is quite difficult for informal sector to adopt les cash system.for poor people less cash model of economy is not practical.Financial inclusion is not spread throghout india so for them lesscash society ia just a dream.
    Goverment launched Lucky Grahak yojana for consumer and Digi Dhan vyapar yojana for merchants with the aim of promoting digital payement.it also launched RuPay card,Vittiya Saksharta abhiyan,BHiM app;linakage of Aadhar to bank accounts only to move towards cashless society.here technology playes an important role in success of all such inititaive .
    India is not the first counrty to move towards cashless economy .many other countries also succefully shifted towardts it in past but we can not think along the line of other country .Polpulation ,low literacy rate,unfamiliarity of large section of people with technology ,low internet penetration pay hindrances in its path.
    IT INFRASTRUCTURe should be robust ;where India is still srtuggling.
    So we can shift to less cash economy; realizing this dream also depends on how we deal with issue of cyber security ,financial inclusion ,proper awareness among mass and suitable redressal mechanism.less cash economy is most important step towards cashless society.

  8. Well thought, balanced and inclusive answer. Expression , presentation and analysis is up the mark. Somewhere use of full stop and capital letters skipped. Good answer. 6 marks.

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