International Journal of Research in Economics and Social Sciences
Year : 2014, Volume : 4, Issue : 1
First page : ( 9) Last page : ( 21)
Online ISSN : 2249-7382.

Global economic crisis and Indian economy

Kaur Amandeep

Assistant Professor, Department of Economics, G.N.K College, Yamuna Nagar (Haryana) India

Online published on 5 June, 2014.

Abstract

Recession means when the price level, investment level and the profit level decrease which leads to less employment and less GDP etc. The said recession mainly attributed to the financial crisis which took place in the advanced economies-especially USA in July, 2007. The effect of the recession was global and the global GDP contracted about more than one and a half percent. The main effect of recession was seen on the developed economies while the developing economies growth rate declined but remained positive.

The present paper explains the effect of recession on the Indian Economy. Because of joining the globalization process initiated mainly by the rich imperialistic countries, Indian economy became more dependent on these rich countries. As of this proximity, Indian Economy has to bear the consequences of recession occurring in these rich countries. The GDP growth rate was affected by this recession and also the growth rate of manufacturing came down to 2.4% which was 11.85 earlier. Even the Foreign Direct Investment also suffered. The present paper highlights the negative effects of recession on the Indian Economy. The recession in the rich countries affected negatively the production, external trades, profits, capital formation and employment in Indian Economy.

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