Hindu Rate of Growth recently this term came into the limelight when the former RBI governor made the statement that “the Indian economy is dangerously close to the Hindu growth rate.”
Former Reserve Bank of India (RBI) governor Raghuram Rajan sounded a note of caution, saying India was “dangerously close” to the ‘Hindu rate of growth’.
He referring to India’s slow economic growth and blamed subdued private sector investment, high interest rates and a slowdown in global growth as the factors.
But what exactly does ‘Hindu rate of growth’ mean and when was the term first used?
Hindu Rate of Growth Who coined this term?
There was an economist in India named Rajkrishna. He was teaching students in Delhi in 1978 when he coined the term “Hindu growth rate.”
This Hindu growth rate is also known as the Nehruvian growth rate because India was growing on the principles of Nehru during the 1950s-1980s.
When India was under British control, they tried to exploit India as much as they could. Eventually, India was growing by less than one percent before the 1950s.
The term “Hindu growth rate” was coined in the 1970s to describe India’s low economic growth rate at the time, which was perceived as being caused by its Hindu culture and its socialist policies.
The term is now considered derogatory and outdated, as India’s economic growth has since picked up significantly and outpaced many other countries in recent decades. India is now one of the fastest-growing major economies in the world.
It is important to note that economic growth rates are influenced by a complex set of factors, including government policies, infrastructure, education, technology, natural resources, and global economic conditions. Culture and religion are not significant determinants of economic growth.
India was following a socialistic approach and tried to control every public sector undertaking. India faced wars with its neighbors as follows:
1947 – Indo-Pak War
1962 – India-China War
1965 – Indo-Pakistan War
1971 – Vijay Diwas
Still, India was able to grow at a rate of four percent a year. This was surprising when India’s neighbor China was showing a growth rate of one to two percent a year.
The IMF predicts that in 2023, India will be growing by 6.1%.
There was a time when a growth rate of four percent was considered good, but now it is a nightmare for Indians.
Takeaway of the article: When the Indian economy grows at an average of four percent, this phenomenon is called the Hindu growth rate.
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