India trade has helped significantly in boosting the Indian economy

ABSTRACT

The intention of the research is to understand how India's trade has helped significantly in boosting the Indian economy. The Republic of India being the seventh largest country in the world stands as the second most populous country in the world after china and is situated in South Asia. The India's economy was on the world's twelfth position in terms of nominal gross national product which was about 1,200 billion U.S. dollars in 2009. Considering its trade deficit with in reference to China, it's not surprising to see more than 50% of a vendor's supply procured or made in China. Even after strong steps by the Indian government, the exports from the country have not risen to their true potential. Additionally policies such as the monetary policy that were implanted to reduce inflation in 2010 have actually have a negative effect on the economy reducing cash flow and exports. The research conducted a comparison study considering a number of variables identifying their significant and effect on Indian trade. Keeping this in mind, the research fails to reject H1 , H3 , H6 and H8 .

CHAPTER 01: INTRODUCTION

The intention of the research is to understand how India's trade has helped significantly in boosting the Indian economy. A variety of literatures have been reviewed to get a better understanding of the topic, and to study details of India and the effect of its trade on the economy. This chapter will shed light on some basic information so the reader can have a better understanding of some details so the discussion and the conclusion are clearer.

Background of the study

Pursell, (2006) states that India's economy in terms of nominal gross national product was of about 1,200 billion U.S. dollars in 2009 bringing it to an outstanding worldwide twelfth. In relation to the gross domestic product, the purchasing power parity (PPP) in India was on the 4th place according to calculations of the International Monetary Fund in 2008, after the United States, the People's Republic of China and Japan .It is essential to keep in mind that India is a controlled economy. Ravallion, (2004), further states that the extensive government regulation of the domestic economy and the comprehensive protection of the economy from foreign competition, however, were gradually reduced, particularly since the early 1990s resulting in the economic boost. Economic growth accelerated in the years 1995 to 2005 to an average of 6.4 percent. The value of the gross domestic product at current exchange rates is around 880 billion U.S. dollars.

India's economy in 2011

Tight monetary policy pursued by the Bank of India to curb inflation since 2010, has had a negative impact on the economy. On expectations that inflation will remain high during 2011, the Central Bank is likely to announce rate increases on July 26. The expected rate hike by the Bank of India on Tuesday may be the last in a cycle of tightening monetary policy of the country, writes ...