• 9964432222
  • Mail Us
  • Appointment
  • Locate Us
  • Chat Now
  • Courses
  • Login
  • Register
Manifest IAS
JournalsOfIndia
Manifest Learning Academy
  • Home
  • SNIPPETSfor Prelims
  • ARTICLESfor Mains
  • BROWSEBY SOURCE
  • DOWNLOADS
No Result
View All Result
  • Home
  • SNIPPETSfor Prelims
  • ARTICLESfor Mains
  • BROWSEBY SOURCE
  • DOWNLOADS
No Result
View All Result
JournalsOfIndia
No Result
View All Result
Home Economy

Middle-Income Trap

May 24, 2020
in Economy
Reading Time: 2 mins read
0
685
VIEWS
Share on WhatsAppShare on TelegramShare on Facebook
image_pdfMake PDF
  • The Economic Survey 2018 (volume I) makes a theoretical examination of India facing a Late Convergence Stall and the risk of falling into the Middle-Income Trap.
  • To understand the Middle Income Trap, classification of countries by the World Bank in terms of Per-Capita Income is to be understood.
  • The World Bank is classifying countries in terms of per capita income.
  • Low-income countries are those with a per capita income lower than $1005.
  • The second category is the middle-income group with a per capita income varying from $1006 to $ 12235. This group is the largest one with nearly 81 countries.
  • Countries with a PCI of $12236 and above are classified as higher-income economies.

What is the Middle Income Trap?

  • The “middle-income trap” is the phenomenon of hitherto rapidly growing economies stagnating at middle-income levels (of per capita income) and failing to graduate into the ranks of high-income countries.
  • Coined in 2006 by World Bank economists Indermit Gill and Homi Kharas, the term refers to a sustained economic slowdown following a period of strong growth.

Reasons for this situation in India

  • The economic reforms that India unleashed in 1991 led to a period of strong growth lifting millions out of poverty and increasing the size of the economy by almost nine times in about 30 years.
  • However, unlike China and other prosperous East Asian nations, there was no mass shift from farm to factories.
  • India failed to create a robust manufacturing sector, which today accounts for less than 17% of the economic output.
  • Service led economic growth→ jobless growth→ India’s economic growth has been powered by investments in the services sector, which could only create a few million high-skilled jobs, thereby forcing a staggering 81% of the workforce to be employed in the informal sector.
  • The Asian Development Bank has found that unequal income distribution
  • India has very low levels of human capital growth for an ambitious and fast-growing major economy. The World Bank ranked India at a lowly 115th out of 157 countries in its Global Human Capital Index rankings released last year.

Solutions:

  • Attracting more investments in infrastructure development
  • implementing land and labor reforms
  • investments in human capital formation
  • provision of better social security to people

 

image_pdfMake PDF
Tags: Prelims

Related Posts

What is short selling?

What is short selling?

January 28, 2023
The trade-plus-one(T+1) settlement plan

The trade-plus-one(T+1) settlement plan

January 27, 2023
SEBI’s information database on municipal bonds

SEBI’s information database on municipal bonds

January 25, 2023
Caller Name Presentation (CNAP) proposal by TRAI

Caller Name Presentation (CNAP) proposal by TRAI

January 20, 2023
Oxfam Report -‘Survival of the Richest’

Oxfam Report -‘Survival of the Richest’

January 19, 2023
Draft National Retail Trade Policy

Draft National Retail Trade Policy

January 19, 2023
World Social Report 2023

World Social Report 2023

January 18, 2023
Indian Railways deal with Siemens for high horsepower engines

Indian Railways deal with Siemens for high horsepower engines

January 18, 2023
Coal Ministry relaxation in Performance Bank Guarantee

Coal Ministry relaxation in Performance Bank Guarantee

January 17, 2023
New Umbrella Entity

New Umbrella Entity

January 9, 2023
Please login to join discussion

Our Offline Classroom Student

CONGRATULATIONS TO 2021 TOPPERS !!!

Rank 171 Kumar Shivashish
Rank 250 Sahithya
Rank 263 Sumit Kumar Thakur
Rank 311 Deepak Ramachandra Shet
Rank 455 Ravinandan B M

January 2023
MTWTFSS
 1
2345678
9101112131415
16171819202122
23242526272829
3031 
« Dec    

Browse by Category

  • Agriculture
  • Disaster Management
  • Economy
  • Environment
  • Ethics
  • Foreign Affairs
  • Geography
  • Governance
  • History
  • Law & Policy
  • Opinion
  • People in News
  • Places in News
  • Science & Tech
  • Security
  • Society
  • Sports
  • Uncategorized

Browse by Tags

AIR All India Radio BBC Business Line Business Standard dow Down to Earth DownToEarth DTE Economic Times ET FAO Financial Express GS-1 GS-2 GS-3 GS-4 Hindustan Times IE India & the world Indian express Indiatoday India today Kurukshetra Livelihoods portal LiveMint Mains News News Paper Newspaper PIB Prelims PRS India RSTV Science Reporter Survey The Hindu The India Express The Indian Express The Print the wire Times of India TOI TOPPERS Yojana
JournalsOfIndia

Our vision is to orient the readers to grasp the facts objectively and analyse critically. In the rush of reaching first to the readers, the websites miss the balanced opinion, which is the need of the hour. We aim to reach the readers with more crispness, preciseness and relevance. We bring the articles in UPSC way for the civil services aspirants and the Wisest Way for general readers.

Categories

  • Agriculture
  • Disaster Management
  • Economy
  • Environment
  • Ethics
  • Foreign Affairs
  • Geography
  • Governance
  • History
  • Law & Policy
  • Opinion
  • People in News
  • Places in News
  • Science & Tech
  • Security
  • Society
  • Sports
  • Uncategorized

Browse by Tag

AIR All India Radio BBC Business Line Business Standard dow Down to Earth DownToEarth DTE Economic Times ET FAO Financial Express GS-1 GS-2 GS-3 GS-4 Hindustan Times IE India & the world Indian express Indiatoday India today Kurukshetra Livelihoods portal LiveMint Mains News News Paper Newspaper PIB Prelims PRS India RSTV Science Reporter Survey The Hindu The India Express The Indian Express The Print the wire Times of India TOI TOPPERS Yojana

Newsletter

The most important UPSC news and events of the day.

Get Journals daily newsletter on your inbox.

© 2020 JournalsOfIndia - A free initiative by Manifest Team.

  • Login
  • Sign Up
  • Home
  • SNIPPETS
  • ARTICLES
  • BROWSE
  • DOWNLOADS
No Result
View All Result

© 2020 JournalsOfIndia - A free initiative by Manifest Team.

Welcome Back!

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In