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Exports as a percentage of GDP have fallen from Simultaneously, there are signs that even domestic consumption growth is characterised by a higher level of import intensity. The structural challenge which India faces is a loss of competitiveness in domestic manufacturing. As long as this challenge remains unaddressed, the economy will remain vulnerable to macroeconomic instability stemming from currency markets and capital outflows. Additionally, domestic reform should spread to new areas such as education as there has been a marked rise over the last five years in students going abroad to study.
The current developments in the currency market are a message that India can no longer afford to postpone reforms across both manufacturing and services. Inflow of Foreign fund comes through Export, which is stagnant since long.
Manufacturing, with which they share a symbiotic relat This piece appeared as an editorial opinion in the print edition of The Times of India. From around the web. More from The Times of India. Become a Strategy Manager to maximise your earnings on the forex market. Add the following FXTM number to your contact list: Find FXTM by searching on the top search bar.
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