Class 12 Economics – Current Challenges Facing the Indian Economy

Chapter Overview

This chapter analyses key challenges confronting India’s economy today. It covers growth slowdown, inflation & monetary policy, trade & current account stresses, unemployment, infrastructure deficits, environmental and climate risks, and digital & financial inclusion hurdles. These issues frame policy priorities and future economic direction. :contentReference[oaicite:0]{index=0}

Important Keywords

• Growth Slowdown: GDP decelerating from 8% to ~5–6% range. :contentReference[oaicite:1]{index=1}
• Inflationary Pressure: Food and global oil prices pushing inflation above comfort. :contentReference[oaicite:2]{index=2}
• Current Account Deficit (CAD): Under pressure due to high crude import prices. :contentReference[oaicite:3]{index=3}
• Unemployment: Sluggish job creation, especially in MSMEs. :contentReference[oaicite:4]{index=4}
• Trade Tensions: Risk of tariffs on exports (e.g., US‑India). :contentReference[oaicite:5]{index=5}
• Infrastructure Gap: Over $1.4 tn needed in transport, energy. :contentReference[oaicite:6]{index=6}
• Digital Divide: Uneven tech access among poor & rural. :contentReference[oaicite:7]{index=7}
• Climate Risk: Vulnerability to extreme weather, finance sufficiency. :contentReference[oaicite:8]{index=8}