What is the economic system of India? Why?

Question

The answer to that is supposed to be given by answering these questions so if you can, please answer them too.

- Who owns the means of production?

- Who decides what, how much and for whom to produce?

- Discuss the allocation system.

- What is the role of the state in the economy?

Thanks. I won't be needing it until after tomorrow, though.

Answer 1

Economic System in India is best described as a State-dominated and regulated mixed economy with highly restricted operation of free competitive markets.

Who owns the means of production?

Ans: Both the state and indivuduals own the means of production. Except in small scale operations including agriculture and transport and other services, the State owns directly or indirectly through public/ joint sector a dominating part of the means of production

- Who decides what, how much and for whom to produce?

These are decided partli through market forces and partly by the State through directives to the Oublic sector producers and Govt. controls on private sector production/ prices.

- Discuss the allocation system.

The allocation system is the price system now but still considerably influenced by physical, discretionary intervention by the State / govt. at cvarious levels.

- What is the role of the state in the economy?

Ans : The State continues to play a dominant and in many cases the dictatorial role in the economy. Large investments are still influenced by the Govt.  Despite liberalisation and withdral of liecence permit raj, the State still exercises power to make or mar private sector operations. Besides, licece permit raj has been introduced in education and health where earlier there was vrirtually no role for private sector but now allowed bu under very ciontrolled regime. The State/ Govt. rather than plaing the role of facilitating role for private sector, plays the role of patronising private sector through its powers.