2.1 Political Institutions

Legislative

The political environment of business refers to the political or government actions that impact business operations. The political factors usually go hand in hand with the legal ones and are generally viewed because the non-market forces that impact businesses. Political decisions ultimately affect the economic, social and cultural environments as an entire.

The political environment is studied in terms of the central government, the citizens of a country, rules, and regulations or international relations. Examples of political factors associated with the central government of a country are levels of bureaucracy, corruption, and government stability. A culture of corruption in a country stifles business operations by creating an uneven playing field where corrupt individuals are more empowered to advance their business goals than their non-corrupt counterparts. A highly unstable government is unable to provide businessmen the safety they need to trade peacefully, hence a highly volatile trading environment. Examples of political factors tied to international relations are policies on trade tariffs, policies on importation and exportation of products and services and international trade agreements.

Legislature, law-making branch of a government before the arrival of legislatures

Functions of a Legislature:

1. Legislative or Law-making Functions:

The first and foremost function of a legislature is to legislate i.e. to form laws. In ancient times, laws used to be either derived from customs, traditions and religious scriptures, or were issued by the kings as their commands. However, in the contemporary era of democracy, legislature is that the chief source of law. it's the legislature which formulates the will of the state into laws and gives it a legal character. Legislature transforms the demands of the people into authoritative laws/statutes.

2. Deliberative Functions:

To deliberate upon matters of national importance, public issues, problems and needs is a vital function of a modern legislature. Through this function, the legislature reflects the public opinion over various issues. The debates held in the legislature have a great educative value for the people.

3. Custodian of National Finances:

A near universal rule is that “the legislature of the state is the custodian of national purse.” It holds the purse of the nation and controls the finances. No money is raised or spent by the executive without the approval of the legislature. each year the executive has got to prepare and get passed from the legislature the budget for the coming financial year. Within the budget, the executive must place the account of the actual income and expenditure of the previous year and estimated income and expenditure for the New Year.

Not only the legislature passes the budget but also it alone can approve the imposition, or repeal or collection of any tax whatsoever. Further, the legislature maintains a control over all financial transactions and expenditures incurred by the executive.

4. Control over the Executive:

A modern legislature has the power to exercise control over the executive. in a parliamentary system of state, like the one which is at work in India, for all its actions, decisions, and policies, the executive is collectively responsible before the legislature. It’s accountable before the legislature. The legislature has the power to remove the executive by passing a vote of no-confidence or by rejecting a policy or budget or law of the executive.

The Prime Minister and all other ministers are essentially the members of the legislature. They’re bound by the principles and procedures of the Parliament.

5. Constituent Functions:

In almost every state, it's the legislature which has the power to amend the constitution. For this purpose, legislature must pass special laws, called amendments, in accordance with the procedure laid down within the Constitution. In some states the need is that the legislature must pass the amendment with 2/3rd or 3/4th or a majority of votes.

6. Electoral Functions:

A legislature usually performs some electoral functions. the 2 houses of the Indian Parliament elect the Vice-President. All elected MPs and MLAs form the electoral college which elects the President of India. In Switzerland, the Federal Legislature elects the members of the Federal Council (Executive) and therefore the Federal Tribunal (Judiciary).

7. Judicial Functions:

It is customary to provide some judicial power to the legislature. Usually, the legislature is assigned to act as a court of impeachment i.e. as an investigating court for trying high public officials on charges of treason, misdemeanour and high crimes and remove them from office. In India, the Union Parliament can impeach the President. it's also the facility to pass a resolution for the removal of Judges of the Supreme Court and of the High Court’s on the ground of misbehaviour or incapacity.

8. Ventilation of Grievances:

A legislature acts as the highest forum for ventilation of public grievances against the executive. Besides representing every interest and shade of opinion, the legislature acts as the national forum for expressing public opinion, public grievances and public aspirations. Parliamentary debates and discussions throw a flood light over various matter of public importance.

Executive

It is that organ which implements the laws passed by the legislature and therefore the policies of the govt. The rise of welfare state has tremendously increased the functions of the state, and in reality of the executive. In common usage people tend to identify the executive with the govt. In contemporary times, there has taken place a big increase in the power and role of the executive in every state.

What is Executive?

The term ‘Executive’ has been defined both in its broad and narrow forms. In its broad form, it's taken to mean all the functionaries, political power-holders (Political Executive) and permanent civil servants who undertake the execution of laws and policies and run the administration of state.

In its narrow form, it's taken to mean only the executive heads (ministers i.e. the political Executive), who head the govt. departments, formulate the policies and supervise the implementation of the laws and policies of the govt. in the narrow form, the civil service and its administrative functions aren't included in the realm of the executive.

Traditionally, only the narrow meaning used to be accepted by the political scientists. However, in present time, the executive is defined in its broader form and it covers both the Political Executive as well as the civil service

Executive: Definition:

(1) “In a broad and collective sense, the executive organ embraces the combination or totality of all the functionaries and agencies which are concerned with the execution of the will of the state as that will have been formulated and expressed in terms of law.” Garner

(2) “In its broadest sense, the executive department consists of all government officials except those acting in legislative or judicial capacity. It includes all the agencies of government that are concerned with the execution of states will as expressed in terms of law.” Gettell

These two definitions make it clear that executive includes the political executive (Ministers and Head of State) and therefore the non-political permanent executive (Civil Service or Bureaucracy). The political executive performs the function of creating policies and ensuring that all the laws are properly enforced by all the departments of the govt.

The permanent executive i.e. bureaucracy/civil service runs the day-to- day administration and works in government departments. It works under the supervision and control of the political executive.

Two Parts of Executive: Political Executive & Permanent Executive: Distinction:

(i) The Political Executive (Ministers):

It consists of the executive head of the state and other heads of the executive departments is ministers. Ministers are political leaders. They’re mostly elected representative of the people and responsible for all their decisions and policies before the public. Political Executive work for a fixed tenure of about 5 years

It acts as a temporary executive in the sense that it changes after every election. After completing tenure, ministers need to again contest elections. They will again become ministers only the party to which they belong returns to power as the majority party.

The ministers are amateurs, non-experts and non-professionals. Their function is to formulate policies and get these policies and laws approved from the Legislature. Thereafter these policies and laws of the State are implemented by the civil servants, who work under the control of Political Executive. The political executive heads the govt. Each minister is head of a department or some of the govt.

(ii) The Non-political Permanent Executive (Civil Servants):

It consists of the civil servants (Bureaucracy) from the lowest to the highest levels. It carries out the day to day administration by working within the government departments. The civil servants are politically neutral. They do not owe allegiance to any party.

Their job is to carry out the laws and policies of the govt. without any political consideration. They’re specially educated and trained persons. They’re experts and professionals. They provide expert advice and opinion also as collect, classify and present data to the political executive on the idea of which the latter takes all decisions.

Once appointed, the civil servants remain in office till the attainment of the retirement age, usually up to the age of 55 or 60 years. They get regular and fixed salaries and are hierarchically organised into higher and lower relationships.

Functions of the Executive:

1. Enforcement of Laws:

The primary function of executive is to enforce laws and to maintain law and order in the state. Whenever a breach of law takes place, it's the responsibility of the executive to plug the breach and bring the offenders to book. Each department is responsible for the implementation of the laws and policies concerning its work. For maintaining law and order in the state, the executive organises and maintains the police.

2. Appointment-making Functions:

All major appointments are made by the chief executive. As for instance, the President of India appoints the judge and other Judges of the Supreme Court and High Courts. Ambassadors, Advocate General of India, Members of Union Public Service Commission, Governors of States etc

Likewise, the President of the United States makes a very large number of key appointments. All the secretaries who head various government departments, Judges of the Supreme Court and other Federal Courts, the Federal officials within the States etc., are appointed by the US President. However, all such appointments require the approval of the United States Senate (Upper House us congress i.e. Parliament).

The members of the civil service also are appointed by the Chief executive. This is, usually, done on the advice of a service recruitment commission. In India, the Union Public Service Commission annually holds competitive examinations for All India Services, Central Services and Allied Services.

It recruits on merit, candidates for appointment to those cadres. The appointments are done by the Chief executive in accordance with the recommendations of the UPSC. Similar practice prevails in most the states. as such appointment-making is a function of the executive.

3. Treaty-making Functions:

It is the responsibility of the executive to decide on which treaties are to be signed with which other countries. the executive negotiates the treaties in accordance with the procedure defined by international law and also in accordance with the provisions the constitution of the state.

Each treaty is signed by a member of the executive. Most of the treaties also require ratification by the legislature of the State. it's again the responsibility of the executive to secure legislative approval for the treaties signed by it.

4. Defence, War and Peace Functions:

One of the key functions of the state is to defend and preserve the unity and integrity of the country and protect it within the event of an external aggression or war. it's the responsibility of the executive to undertake this work. To organise military for the defence of the state, to organize for and fight the war, if it becomes necessary, and to negotiate and sign peace settlement after every war, are the functions performed by the executive.

The executive is that the final judge of the nature of the threat to the safety of the country. it's the prime responsibility to take all such steps as are needed within the interest of the safety and integrity of the state. The chief executive of the state is additionally the supreme commander of the armed forces of the state.

5. Foreign Policy-making and the Conduct of Foreign Relations:

In this age of ever-increasing global interdependence, it's become one among the most important functions of a government to formulate the policy of the state and to conduct foreign relations. This function is also performed by the executive.

The executive formulates the goals of national interest and fixes the priorities. It first formulates the foreign policy of the nation and then implements it for securing the defined goals of national interest. the executive appoints the ambassadors of the state to other states.

6. Policy-making:

Modern welfare state needs to carry out a large number of functions for securing the socio-economic-cultural development of its people. it's to formulate policies, prepare short-term and long-term plans and implement these. All actions of the state are guided by definite policies and plans.

It is the executive which undertakes the task of policy-making and developmental planning. These are the 2 most vital functions of the executive, because by these the state carries out its objective of promoting the welfare of its people.

7. Functions regarding Law-making:

Law-making is primarily the function of the legislature. However, the executive also plays a role in law-making. during this sphere too the role of the executive has been increasing by leaps and bounds. in a parliamentary system, the ministers also are members of the legislature and that they play a leading role in law-making.

Most of the bills for legislation are introduced and piloted by them within the legislature. Most of the time of the legislature is spent in passing the governmental bills. The bills passed by the legislature become laws only after these are signed by the head of the State.

8. Law-making under the system of Delegated Legislation:

The system of delegated legislation has considerably increased the law-making role of the executive. Under this technique, the legislature delegates a number of its law-making powers to the executive. the executive then makes rules on the basis of these powers. the number of delegated legislation made by the executive far out-weighs the laws passed by the legislature.

9. Financial Functions:

It is the legislature which is the custodian of all finances. it's the power to impose, or reduce or eliminate a tax. However, in actual practice, the executive exercises variety of financial functions. It’s the responsibility to prepare the budget. It proposes the levy of new taxes or changes in tax structure and administration. It collects and spends the money as sanctioned by the legislature.

The executive decides the ways and means through which the money is to be collected and spent. It formulates all economic policies and plans. It takes suitable measures for regulating the production and distribution of goods, money supply, prices and exports and imports. It contracts foreign loans, negotiates foreign aid and maintains the financial credibility of the state.

Judiciary

Judicial System or the court system is also the Judiciary System. The court has the power to make decisions and also enforce the law, solve disputes. Judiciary system consists of Judges and other magistrates; they form the bench or the core of the judiciary system.

On 26 January 1950, the Indian Constitution was written and its world’s largest constitution written. The constitution is that the source of law in India and also the supreme law of India. judiciary of India consists of Supreme Court, supreme court, District Court or Subordinate Court.

Supreme Court of India

Under the constitution of India, the Supreme Court is that the final court of appeal. Hence has the chief justice of India, including 30 judges and other judges for advisory jurisdiction. Unsolved or still in dispute cases are levelled up to Supreme Court to re attain justice. If the Supreme Court declares a law it's binding on all other courts of all States and Union territory. Every court building has 15 courtrooms.

High Court of India

Under the constitution of India, every state should reference to one high court. Mumbai high court is the oldest high court in India. Every high court has 94 judges out of which 71 are permanent and 23 are additional judges. High court deals with economic issues and legal documentation. These courts even have a further set of legal professionals.

District Court of India

Under the constitution of India, district courts or Subordinate Courts are subordinate to the high court. District courts are established consistent with the population distribution of the district and state. It’s after the Civil and criminal matters of the district. A law declared by the district court is applicable to all subordinate courts. Since District court is at a higher hierarchical level.

2.2 Role of government in Business

Government is a very powerful institution which can create a good business environment.

We can study its role under the subsequent heads:

Role

1. Government: Regulator of Business:

The entire regulatory legislation and policies stand covered under this segment. On the one hand, there is a really large indirect area of government control over the functioning of private sector business through budgetary and monetary policies.

But against this there's also a fast expanding area of direct administrative or physical controls through which the govt. seeks to make sure that private investment and production in industry and therefore the use of scarce resources conform to government’s basic socio-economic objectives.

They have become necessary tools in a system which seeks to avoid total nationalisation of resources.

Government’s regulatory functions with respect to trade, business and industry aim at laying down the boundaries for the private enterprise. The regulatory functions of the govt. include

(i)                restraints on private activities,

(ii)              control of monopoly and big business,

(iii)           development of public enterprises as an alternate to private enterprises to make sure competitive dualism,

(iv)            Maintenance of a proper socio-¬economic infrastructure.

2. Government: Promoter of Business:

The promotional role of the govt. in regard to industries is seen as providing finance to industry, in granting various incentives and in creating infrastructure facilities for industrial growth and investment.

For example, our government has identified certain backward areas as ‘No Industry Districts’. To promote development of such areas, Government provides subsidies and tax holiday to draw in investment in backward areas.

In this way the govt. will help the process of balanced development and thereby remove regional disparities. The govt. is assisting the development of small scale industries.

The District Industrial Centres are assisting the development of small industries. the govt. is actively helping the industrial development of the country by providing finance to them through the development banks.

3. Government as an Entrepreneur:

The impressive growth of the public sector in India from a small beginning bears testimony to the role of the govt. as an entrepreneur.

Private investors are solely guided by private profit motive and hence they're not interested in developing products of common public use and social services which yield relatively lower returns. But as a “social entrepreneur” the govt. doesn't hesitate to take them up.

4. Government as the Planner:

In its role as a planner, the govt. indicates various priorities in the Five Year Plans and also the sectorial allocation of resources. Mixed economies are democratically planned economies.

5. Permission to form and Operate

Most businesses got to register with a government to operate. Corporations need a charter, and other sorts of businesses, like limited liability companies or partnerships, need other sorts of registration. The function of this registration is usually to define the financial liability the owners of the company have.

It limits their risk to the amount they have invested in that particular organization. Registration also allows the government to monitor companies to execute its other functions within the business world.

6. Creating and Enforcing Contracts

Businesses contract with other businesses. These contracts may be complex, like mergers, or they'll be as simple as a warranty on supplies purchased. the govt. enforces these contracts. Companies bring one another to court even as individuals do.

An oral agreement can constitute a contract, but usually only a agreement is provable. If one party fails or refuses to satisfy its obligation under a contract, a corporation will turn to the legal system for enforcement.

7. Consumer Protection and Safety

The government’s role in business includes protecting the buyer or customer. When a vendor fails to honour the guarantee, the purchaser has recourse in the law. Likewise, when a product causes harm to an individual, the courts may hold the seller or manufacturer responsible. Labelling is another requirement the govt. imposes on marketers.

Many foods, for instance, must display nutritional content on the packaging. The U.S. has been making advances in consumer rights for many years. However, the consumer movement still needs considerable development to guard the public.

8. Employee Rights and Protections

Many state and federal agencies work to protect the rights of employees. The Occupational Health and Safety Administration, for instance, is workplace under the Department of Labour. Its mission is to make sure a safe and healthful work environment. The equal opportunity Commission protects employees from discrimination.

9. Environmental Regulations and Protection

When a marketing transaction impacts a third party – others besides the marketer and purchaser – the effect is named an “externality.” The third party is usually the environment. Thus, it's the government's role to control industry and thereby protect the public from environmental externalities.

Whether the govt. is effective in this role is a matter of much discussion. The Gulf oil spill of 2010 has been cited as evidence of lax oversight.

10. Revenue and Taxation

Governments at all levels tax businesses, and therefore the resulting revenue is a crucial a part of government budgets. Some revenue is taxed at the corporate level, then taxed as personal income when distributed as dividends. this is often in no way inappropriate, since it balances the tax burden between the company and individual and allows the govt. to tax more equitably.

11. Investor Rights and Protection

Government mandates that companies make financial information public, thereby protecting the rights of investors and facilitating further investment. this is often generally done through filings with the Securities and Exchange Commission. Whether federal regulation has been adequate is a matter of much debate.

2.3 LEGAL FRAME WORK IN INDIA

PHILOSOPHY OF THE CONSTITUTION

The Preamble of Indian Constitution is the most vital part which includes together the fundamental Rights and Directive Principles also because the aims and ideals of the constitution. The philosophy of the constitution is nothing but the values, ideals, aims, objectives etc. as the foundation on which it stands up. The first Session of the Constituent Assembly was held in New Delhi on 9th December 1946 under the provisional chairmanship of Dr. Sachindanand Sinha. On 11th December 1946 Dr. Rajendra Prasad was unanimously elected as the President of Constituent Assembly. On 9th December 1946, Pt. Jawaharlal Nehru moved the “Objective Resolution” which was unanimously acclaimed and adopted on 22nd January 1947 by the Constituent Assembly. The objective Resolution reflected high ideals and philosophy which inspired the shaping of the constitution of India through all its subsequent stages. These ideals and philosophy embodied within the Objective Resolution are truly reflected within the Preamble to the constitution of India. This objective Resolution was focused on the concept of an India emerging as a sovereign Republic with its power and authority derived from the people wherein social, economic and political justice was to be guaranteed and secured to each individual as also equality of status and opportunity to everyone. it had been a firm resolve and a pledge to create a sovereign Democratic Republic in India.

CONTENT OF PREAMBLE:

The Preamble means Preface, Preliminary statement or an introduction to any literary composition or scholarly work. It’s the beginning remark which takes the readers and therefore the executors of the instructions towards guidance to performance. The Preamble to the Indian Constitution reveals the minds of the Indian Society though a divergent in nature. It reflects the sustaining goals of the Indian polity and therefore the ideals are sought to be achieved through the medium of the Constitution.

The Preamble begins as follows:

“WE THE PEOPLE OF INDIA, having solemnly resolved to constitute India into a SOVEREIGN, SOCIALIST, SECULAR, DEMOCRATIC REPUBLIC and to secure to all its citizens

JUSTICE: Social, Economic and Political;

LIBERTY: of thought, expression, belief, faith and worship;

EQUALITY: of status and of opportunity; and to promote among them all

FRATERNITY: assuring the dignity of the Individual and the unity and integrity of the Nation;

IN OUR CONSTITUENT ASSEMBLY this 26th of November, 1949, do HEREBY ADOPT, ENACT and give TO OURSELVES THIS CONSTITUTION”. Added by 42nd Constitutional Amendment Act, 1976 now we've to elaborate the Preamble word to word as per its concealed values, ideals, objectives and philosophy

WE THE PEOPLE OF INDIA means it's the people of this country adopt and enact the constitution, a legal body for themselves. On behalf of the people, the founding fathers and chief architect of the Constitution Dr.B.R.Ambedkar prepared this document of Constitution. They’re not themselves adopting and enacting but the people are the main body to make the constitution. They’re the representatives of the people and its people that are resolving to constitute India.

 SOVEREIGN, SOCIALIST, SECULAR, DEMOCRATIC REPUBLIC:

The people of India constitute India into sovereign nation. The term ‘SOVEREIGN’ means free from any internal or outside control it suggests that the constitution isn't the gift of British Parliament and therefore the people of India are capable of framing the legal body of their own for them. For this purpose, they have sent their representatives to the parliament i.e. the Constituent Assembly. There’s no any limit or any restrictions on the people of India to border the constitution for them.

The term ‘SOCIALIST’ wasn't the part of the Preamble in1950 but was inserted in it by 42nd Constitutional Amendment Act, 1976. Socialist means the Indian masses aim to create an egalitarian society in India, prevent concentration of wealth bring about social control over means of production and ensure equitable and fair distribution of necessities in life. This term is said to the Socialism of Marx but in partial ways. Every citizen will have the proper to earn his livelihood and also improve his standard of living.

The term ‘SECULAR’ also wasn't the part of the Preamble in 1950. By the 42nd Constitutional Amendment Act, 1976 it had been inserted in the preamble. The term secular emphasizes the fact that the Indian State doesn't have any State religion and grants complete freedom of worship and faith to all its citizens. It doesn't encourage or discourage or discriminate against any particular religion. It indicates the very fact that the state is neutral altogether religions matters and therefore the right of citizens are independent of the faith they profess. The spirit of secularism is fully reflected in Article 25 of the constitution which ensures freedom of conscience and right to freely profess, practice and propagate one’s own religion. As per former President of India R.Venkanta Raman, Secular India means “India isn't pro-religious, non-religious and anti- religious”.

The term 'DEMOCRATIC' in the narrow sense refers to the type of government which is elected by the people on the idea of Universal Adult Franchise. In a broader sense, it refers to how of life of the people and various social organizations. Indian Government relies on a representative parliamentary democracy in which the govt. is responsible to the sovereign Legislative Body. There are various sorts of democratic government like Presidential(USA), Kingship (England, Australia, New Zealand) and democracy of which India has adopted parliamentary sort of government.

The term ‘REPUBLIC’ stands for that the head of the Indian State are elected head and not the hereditary ruler by Kingship. It also means the Supreme Powers of the State are vested in people and within the authority of the elected representatives of the people. The term ‘Republic’ also implies that all public offices are receptive all citizen without any discrimination.

JUSTICE, LIBERTY, EQUALITY AND FRATERNITY:

Further, the preamble lays emphasis that the Indian citizens should get justice in three forms like Social Justice, Economic Justice and Political Justice. The architects of the Constitution have made this arrangement of justice very intelligently. There can't be economic justice and political justice without social justice. Indian Society composed of castes, class’s religion, and race. There happened the discrimination among Indians themselves on this basis. Therefore, the constitution is sure to cultivate healthy, social attitude among people and the state must be state accordingly. The social justice is often realized only ‘equals to be treated equally and unequal’s unequally’ as per Aristotle.

The next step of justice which preamble secure for the Indian people is Economic Justice Every citizen of India has right to measure and earn his livelihood. They need to be made available, employment opportunities taking in sight social justice. The Directive Principles of State Policy make it clear that no discrimination would be made between persons on the idea of their economic status. The state is predicted to enact laws and translate the concept of social and economic justice into reality.

Political Justice is merely possible when there's realization of social and economic justice. Previously in India and lots of countries of the world were giving voting rights to only those that are rich by wealth and therefore the high in social status. But the Indian constitution has conferred on all the Indian adult citizens the Universal Adult Suffrage with none discrimination of caste, race, religion, sex, wealth, status, etc. The Indian citizens have gotten one vote and one vote one value which is extremely significant for political justice.

Thus the concept of social, economic and political justice contained within the preamble aim at furthering the goal of social revolution and attempting to foster this revolution by establishing the conditions necessary for its achievement.

The preamble contains that liberty is secured for the Indians, which is of thought, expression, belief, faith and worship. The constitution of India secures for its citizens the liberty that everybody without any bias will have the right to think and express his own views which cannot harm other’s liberty. They can convert to any religion, can worship any god and goddess or believe in any kind of philosophy they require. That’s how the six sorts of freedoms are provided within the article no 19 of the Constitution.

The preamble makes mention of the equality for all the citizens of India without any type of discrimination. There are two quite equalities like equality of status and equality of opportunity. Every citizen of India would be treated equal before law regardless of his caste, religion, race, sex, language etc. also as he shall get equal opportunity to create his economic progress. It also made clear as per the Article 16-(4) that state shall have right to enact laws and make provision for reservation of jobs or posts in favour of any backward class of citizens. This provision also promotes the explanation for justice by providing protective discrimination to those classes of peoples who have suffered because of historical circumstances of casteism. This is what unequal’s to be treated unequally that's justice.

The preamble also provides that the Constitution is guaranteed to promote among the Indians the fraternity which assures the dignity of the individual and therefore the unity and integrity of the state. In the words of Chief architect of Constitution Dr. B.R.Ambedkar, “Fraternity is a sense of common brotherhood and therefore the principle which provides unity and solidarity to social life. He further says “Without fraternity equality and liberty will be no deeper than coats of paints”. Therefore, one has got to take liberty, equality and fraternity not as separate objectives but as forming ‘a union of trinity’ in the sense that to diverse one from the opposite was to defeat the very purpose of Democracy.

All the above provisions further the people of India to adopt, enact and provide within the Constitution which is approved by Constituent Assembly on 26th November,1949.

THE STRUCTURE OF THE CONSTITUTION- THE PREAMBLE, MAIN BODY AND SCHEDULES

The structure of the Constitution is split into the Preamble, the main Body and the Schedules. The main structure of the constitution can't be changed totally as there is provision of Amendment to that. The Indian Constitution contained XXII parts, 395 Articles and 12 Schedules. In this structure the each and every provision has been discussed thoroughly and so got it passed within the Constituent Assembly.

The Preamble:

The preamble is the mirror of the aspirations of the people to themselves which reflects into it. The preamble isn't the part of the Articles but it's the gist of all the provisions elaborated altogether the Articles. It’s the philosophical commitment which might be realized into practice by the govt. & its state. It’s the sum of the Constitution. We have already got discussed the philosophical component of the preamble.

Main Body of the Constitution:

The main body of the Constitution of India consists of 22parts, 395 articles and 12 schedules and they are elaborated thoroughly in these provisions.

PARTS OF THE CONSTITUTION PART I- THE UNION AND ITS TERRITORY:

The part I consists of Articles nos.1-4. Article No.2 deals with Name and Territory of the Union and establishment of new states. Article 3 mentions about the provisions of formation of latest states and alteration of areas, boundaries or names of new states. Article 4 provides the amendment of the first and therefore the Fourth schedules and supplemental, incidental and consequential matter concerning Articles nos.1&3.

PART II- CITIZENSHIP:

The part II consists of Article nos. 5 to 11 in reference to citizenship.

Article 5 relate with the citizenship at the commencement of the constitution.

Articles 6-11 provides for rights of citizenship for migrants to and from Pakistan, or outside India and therefore the right of the Parliament to continue and regulate it.

PART III- FUNDAMENTAL RIGHTS:

Part III deals with Fundamental Rights for Indian Citizen elaborated in the Article nos12 to 35.

The fundamental Rights are the right to Equality, Right to Freedom, Right against Exploitation, Right to Religion, Cultural and educational Rights and Right to Constitutional Remedies.

The right to Property was deleted by the 44th Constitutional Amendment Act, 1978.

PART IV- DIRECTIVE PRINCIPLES OF STATE POLICY:

It includes Articles from 36 to 51 wherein the constitution has directed the state to be welfare state and execute the values, principles of equality, liberty, justice, social justice, health, industrialization, education generally and of weaker sections, etc. Thought the govt... Can’t be pulled in the court for the violation of the Directive Principles but it's also taken as an obligation of the govt. on become the welfare state. Because of fear of not getting elected again, the govt. must do the public works continuously and is elaborated in their part.

PART IV –FUNDAMENTAL DUTIES:

In the 1950’s originally the constitution didn't contain separate Fundamental Duties for the citizens of India because it was natural that everyone respects everybody’s Fundamental Rights. But by the 42nd Constitutional Amendment Act, 1976 it had been separately provided for the 11 fundamental duties for the Indian citizens.

PART V- THE UNION:

The Part V contains 5 chapters associated with individual subject. Chapter I am titled as ‘THE EXECUTIVE’ and contain Articles from 52 to 78.

 Articles 52 to 73 deals with the powers and functions of the President and vice president Articles 74 & 75 provides for the formations of Council of Ministers and its functions. Article 76 makes provisions of appointment and powers, functions of Attorney General of India. Articles 77 & 78 pertain to conduct of state Business and functions and duties of Prime Minister.

Chapter II is titled as ‘Parliament’ and contain Articles from 79 to 122.

 Articles 79 to 88 deals with formation and constitution of Parliament Articles 89 to 98 provides for the officers of the Parliament. Article 99 to 100 deals with the conduct of Business of the Parliament.

An article 101 to 104 makes mention of disqualification of members and therefore the vacant seats.

Articles 105 and 106 deals with the Powers, Privileges and Immunities of Parliament and its Members

Articles 107 to 111 provide for the Legislative Procedures of the Parliament Articles 112 to 117 are associated with Procedure of Parliament in Financial Matters.

Articles 118 to122 provides for the procedure Generally of the Parliament.

Chapter III is titled as ‘LEGISLATIVE POWERS OF THE PRESIDENT’.

In this chapter Article 123 explains the powers of the President during recess of the Parliament to promulgate ordinances.

Chapter IV is titled as ‘THE UNION JUDICIARY’ and contain Articles 124 to 147. These Articles provide for the composition, powers and jurisdiction of Supreme Court of India. Article 143 mentions the powers of the President to consult Supreme Court.

Chapter V- titled as ‘COMTROLLER AND AUDITOR GENERAL OF INDIA’. This chapter contain Articles 148 to 151 and elaborates the appointment, duties, powers of (CAG) Controller and Auditor General of India.

 PART VI THE STATES:

This part contains VI chapters and Articles from 152 to 237 regarding the State Level provisions. Chapter I is concerning General Wherein Article 152 defines the State and its limits. Chapter II is titled as ‘THE EXECUTIVE’ and lies in the Articles from 153 to 167. Article nos.153 to 162 elaborates the Governor, its appointment, powers and functions thus far Articles nos.163 and 164 details about Council of Ministers. Article no.165 provides for ‘The Advocate General of State’.

Articles 166 to 167 deals with ‘Conduct of government Business’ in states, duties of Chief Ministers etc.

Chapter III is titled as ‘THE STATE LEGISLATURE’ and contain Articles from 168 to 212. Articles 168 to 177 explain generally the constitution of Legislature in States, legislative assembly and legislative council.

Articles 178 to 187 talks of officers of the State Legislature like the Speaker, Deputy Speaker of Assembly, Chairman and Deputy Chairman of Council, Secretariat etc.

 Articles 188 to 189 mentions of ‘Conduct of Business of Legislature’

Articles 190 to 193 elaborates the disqualification of members ( MLA’s and MLC’s) because of vacation of seat or the other reason. Articles 194 and 195 provides for the powers, privileges etc. of the houses of Legislatures and their members.

Articles 196 to 201 explain the Legislative Procedure like passing the Bills etc. whereas Articles 202 to 207 provide for the Procedure of Legislature in reference to Financial Matters.

Articles 208 to 212 deals with procedure generally wherein rules are explained

Chapter IV titled as ‘LEGISLATIVE POWERS OF THE GOVERNOR’ which are explained by the Article no.213. E.g. power of Governor to promulgate Ordinances during recess of Legislature

Chapter V titled as ‘THE HIGH COURTS within the STATES’ contain Articles 214 to 231 which provides for the appointment, powers and jurisdiction of the High Courts within the States.

Chapter VI titled as ‘SUBORDINATE COURTS’ and contain Articles 233 to 237 and detail about the appointment, powers and jurisdiction of district and subordinate judges. Article 232 has been repealed from the constitution.

PART VII even have been repealed as per Article no.238 & seventh Constitutional Amendment Act, 1956

PART VIII- THE UNION TERRITORIES:

This part contains Article 239 to 242 and elaborates the administration of Union Territories, special status to Delhi, the powers and functions of President and therefore the High Court’s etc.

PART IX- THE PANCHAYATS:

This consists of Article 243 and explains the constitution of Panchayat Raj & Local Self Government. It also provides for the constitution of Municipalities its powers and functions. Within the same sub-article there's provision of Finance Commission.

PART X:

This contains Article 244 wherein we discover the provisions of the administration of Scheduled Areas and Tribal Areas like in Assam.

PART XI:

This is titled as ‘Relations between the Union and therefore the States’ and contain two chapters. Chapter I states as ‘Legislative Relations’ and consists of Articles 245 to 255. They provide for the powers of parliament and State Legislature. Chapter II elaborates Administrative Relations between Union Government and the government Between Articles 256 and 263 it's detailed about disputes concerning water and co-ordination between states and the role of the Union.

PART XII- FINANCE, PROPERTY, CONTRACTS AND SUITS:

These parts have four chapters and contain Articles 264 to 300. Chapter I is said to Finance and from Articles 264 to 267 is provides with General like taxes imposed, consolidated funds, contingency fund and public accounts. Articles 268 to 281 makes mention of distribution of Revenues between the Union and therefore the States. Again Article 280 provides for Finance Commission. Articles 282 to 290 are related with miscellaneous financial provisions.

Chapter II titled as ‘Borrowing’ and consists of Articles 292 and 293 and mentions of Borrowing by the govt. of India and therefore the State.

Chapter III titled as ‘Property, Contracts, Rights, Liabilities, Obligations and Suits and contain Articles between 294 and 300. It provides for the succession. A property asset, rights, liabilities and obligations also contracts and suits and proceedings.

Chapter IV is titled as ‘Right to Property’ where Articles no.300 A provides that persons to not be deprived of property save by authority of law.

PART XIII titled as ‘Trade, Commerce and Intercourse within the Territory of India’. This part contains Articles 301 to 307 wherein provisions are made for freedom of trade, commerce, powers of parliament to impose restrictions etc.

PART XIV is titled as ‘Services’ under the Union and therefore the States’ and is split into two chapters. It consists of Articles 308 to 323. Chapters I within the Articles 308 to 314 provides for the Recruitment and Conditions of Services of persons serving the Union or a State.

Chapter II is titled as ‘Public Service Commission’ where between the Articles 315 to 323 it makes provision for the UPSC and State Public Service Commission, its functions etc.

PART XIV A and its articles 323A & 323B are provisions of Administrative and other Tribunals.

PART XV is titled as ‘Elections’ and lies between Articles 324 and 329 wherein the provisions of committee, its head its powers and functions are made.

PART XVI- titled as ‘Special Provisions concerning Certain Classes’.

 This part contains Articles 330 to 342 and provides for the Reservation of Seats for SCs and STs, Anglo-Indians in Union and State Legislature and services.

Articles 338 and 338 A provides for the National Commission for SC’s & ST’s respectively.

Articles 340 makes provisions for the appointment of a Commission to investigate the condition of backward classes like OBC’s, NTs, and SBCs etc.

PART XVII titled as ‘Official Language’ and has four chapters. it's articles from 343 to 351. Chapter I (Art -343-344) mentions of Official language of the Union and its Commission, Committees of Parliament would be as Hindi.

Chapter II provides for the Regional languages elaborated in the articles 345 to 347. Chapter III mentions of the language of the Supreme Court, High Courts etc. in English and then is translated by the State into the regional language of the State.

Chapter IV provides the Special Directives within the articles 350 to 351 wherein facilities for mother tongue at primary stage and Special Officer for Linguistic Minorities as also the Directives for development of the Hindi language.

PART XVIII titled as ‘Emergency Provisions’ contain articles 352 to 360. In this part article nos.352, 356 and 360 provide for the proclamation of Emergency like National Emergency, Emergency because of Constitutional failure in State and financial Emergency respectively.

PART XIX titled as ‘Miscellaneous’ contain articles 361 to 367 within which provisions of protection of President and Governors and vice-versa are made.

PART XX is titled as ‘Amendment of the Constitution wherein only article 368 is provided for the power of Parliament to amend the constitution and procedure. Therefore

PART XXI titled as ‘Temporary Transitional and Special provisions’ lies between articles 369 to 392. In these articles the provisions are made where new states are created, special provisions for judges of high courts, CAG, UPSC, etc.

PART XXII is titled as ‘Short Title, Commencement, Authoritative Text in Hindi and Repeals like ‘Indian Constitution’ as a title and to this document and authoritative text within the Hindi language. Article 395 is repealed.

SCHEDULES:

There are 12 Schedules which mentions of varied provisions.

1. First Schedule

I-The States-List of all States II-The Union Territories.

2. Second Schedule:

Part A- Provisions on the President and also the Governors of States. Part B(Repealed) and Part C mentions of Speakers of Lok Sabha, Rajya Sabha, State Assemblies and Councils.

Part D- Provisions on the Judges of the Supreme Court and of the High Courts

Part E- Provisions on the Comptroller and Auditor General of India

3. Third Schedule- Former of Oaths or Affirmations

4. Fourth Schedule- Allocation of seats within the Council of States

5. Fifth Schedule- Provisions on the Administration and control of Scheduled Areas and Scheduled Tribes.

Part A- General.

Part B- Administration and Control of Scheduled Areas and Scheduled Tribes.

Part C- Scheduled Areas.

Part D- Amendment of the Schedule.

6. Sixth Scheduled- Provisions on the Administration of Tribal Areas within the States of Assam, Meghalaya, Tripura and Mizoram.

7. Seventh Schedule List I – Union List II-State List

List III- Concurrent List

8. Eight Schedule- Languages.

9. Ninth Schedule- Validation of certain Acts and Regulations.

10. Tenth Schedules- Provisions on disqualification on ground of defection.

11. Eleventh Schedule- Powers, authority and responsibilities of Panchayats

12 Twelfth Schedule-Powers, authority and responsibilities of Municipalities, etc.

The Fundamental Rights are as follows: - .

1) Right to Equality (equality before law for everyone).

2) Right to Liberty (includes freedoms).

i) Freedom of speech and expression;

ii) Freedom of assembly;

iii) Freedom of practice any profession or occupation;

iv) Freedom of union or professional organization;

v) Freedom of staying anywhere in India;

vi) Freedom to move anywhere in India;

3) Right to freedom of faith.

4) Right against Exploitation.

5) Cultural and academic Rights.

6) Right to Constitutional Remedies.

i) Habeas Corpus

ii) Mandamus

iii) Prohibition

iv) Quo-Warranto and

v) Certiorari

FUNDAMENTAL DUTIES OF THE INDIAN CITIZEN

Basically, Fundamental Rights always corresponds to the fundamental duties of every citizen; therefore, the founding fathers of the constitution must had not specified them. When one individual knows or enjoys his fundamental rights at the same time others also do and show respect for them i.e. duty.

In 1976, there was 42nd Constitutional Amendment Act which is named because the 'Mini Constitution1 by some experts. Article 51-A provided the fundamental duties of Indian citizen which are as follows: - [Effective from 3rd Jan. 1977]

1. To abide by the Constitution and respect its ideals and institutions, the national flag and therefore the National Anthem;

2. To cherish and follow the noble ideals which inspired our national struggle for freedom;

3. To uphold and protect the sovereignty, unity and integrity of India;

4. To defend the country and render service when called upon to do so;

5. to push harmony and also the spirit of common brotherhood amongst all the people of India transcending religious, linguistic and regional or sectional diversities; to renounce practice derogatory to the dignity of women;

6. to value and preserve the rich heritage of our composite culture;

7. To guard and improve the natural environment including forests, lakes, rivers and wild life and to possess compassion for living creatures;

8 To develop the scientific temper, humanism and therefore the spirit of inquiry and reform;

9. To safeguard public property and to abjure violence;

10. To strive towards excellence altogether spheres of individual and collective activity in order that the state constantly rises ‘to higher levels of endeavour and achievement;

11. Who may be a parent or guardian, to produce opportunities for education to his child or because the case may be, ward between the age of six and fourteen years. (This was provided in 2002 by the 86th Constitutional Amendment Act with regard to article 45).

These fundamental duties are sometimes criticised and sometimes favoured by the varied constitutional experts.

2.4 Economic Environment

Definition

The economic environment consists of external factors in a business market and the broader economy that can influence a business. you can divide the economic environment into the microeconomic environment, which affects business decision making - like individual actions of firms and consumers - and the macroeconomic environment, which affects a whole economy and all of its participants. Many economic factors act as external constraints on your business, which suggests that you have little, if any, control over them. Let's take a look at both of those broad factors in more detail.

Macroeconomic influences are broad economic factors that either directly or indirectly affect the whole economy and all of its participants, including your business. These factors include such things as:

• Interest rates

• Taxes

• Inflation

• Currency exchange rates

• Consumer discretionary income

• Savings rates

• Consumer confidence levels

• Unemployment rate

• Recession

• Depression

Microeconomic factors influence how your business will make decisions. Unlike macroeconomic factors, these factors are far less broad in scope and don't necessarily affect the whole economy as an entire. Microeconomic factors influencing a business include:

• Market size

• Demand

• Supply

• Competitors

• Suppliers

• Distribution chain, like retail stores

2.5 Economic Environment - Importance

The economic environment of a business will play a pivotal role in determining the success or failure of a business.

Let's first consider some macroeconomic factors. If interest rates are too high, the cost of borrowing might not permit a business to expand. On the opposite hand, if the unemployment rate is high, businesses can obtain labour at cheaper costs. However, if unemployment is too high, this might result in a recession and less discretionary consumer spending leading to insufficient sales to keep the business going. Tax rates will take a chunk of your income and currency exchange rates can either help or hurt the exporting of your products to specific foreign markets.

Now let's turn our attention to microeconomic factors for a bit. Market size may determine the viability of entering into a new market. If a market is just too small, there may not be sufficient demand and profit potential. This leads us to the concept of demand and supply. If your product is in high demand but there's a low supply of it, you're going to make a tidy profit, but if your product is in low demand and the market is flooded with similar products, you'll be facing bankruptcy. the quality and quantity of your competition will affect how well you do in winning customers in the marketplace. Suppliers are the arteries pumping vital supplies and resources to you for production. If you've got problems with suppliers, it can clog up those arteries and cause serious problems. Likewise, the sort of relationship you have with your distributors, like retail stores, may influence how quickly your products leave their shelves.

2.6 Economic System

An economic system is a means by which societies or governments organize and distribute available resources, services, and goods across a geographical area or country. Economic systems regulate the factors of production, including land, capital, labour, and physical resources. An economic system encompasses many institutions, agencies, entities, decision-making processes, and patterns of consumption that comprise the economic structure of a given community.

Types of Economic Systems

Capitalism

Capitalism is an economic system where private entities own the factors of production. The four factors are entrepreneurship, capital goods, natural resources, and labor.1 The owners of capital goods, natural resources, and entrepreneurship exercise control through companies. Individuals own their labour. The sole exception is slavery, where somebody else owns a person's labour. Although illegal throughout the whole world, slavery continues to be widely practiced.

Characteristics

Capitalistic ownership means owners control the factors of production and derive their income from their ownership. that provides them the ability to operate their companies efficiently. It also provides them with the incentive to maximise profit.

In corporations, the shareholders are the owners. Their level of control depends on how many shares they own. The shareholders elect a board of directors and hire chief executives to manage the corporate.

The owners of supply compete against each other for the highest profit. They sell their goods at the highest possible price while keeping their costs as low as possible. Competition keeps prices moderate and production efficient.

Another component of capitalism is that the free operation of the capital markets. The laws of supply and demand set fair prices for stocks, bonds, derivatives, currency, and commodities. Capital markets allow companies to boost funds to expand.

Laissez-faire theory argues that government should take a hands-off approach to capitalism. It should intervene only to maintain A level playing field. The government's role is to guard the free market. It should prevent the unfair advantages obtained by monopolies or oligarchies. It needs to prevent manipulation of information, ensuring it's distributed equitably.

Part of protecting the market is keeping order with national defense. the govt. also should maintain infrastructure, and it taxes capital gains and income to buy these goals. Global governmental bodies adjudicate international trade.

Advantages

Capitalism results in the best products for the best prices because consumers can pay more for what they need the most. Businesses provide what customers want at the highest prices they’ll pay, and costs are kept low by competition among businesses. they make their products as efficiently as possible to maximise profit.

Disadvantages

Capitalism doesn't provide for those who lack competitive skills, including the elderly, children, the developmentally disabled, and caretakers. to stay society functioning, capitalism requires government policies that value the family unit.

Despite the idea of A level playing field, capitalism doesn't promote equality of opportunity. Those without good nutrition, support, and education may never make it to the playing field. Society will never benefit from their valuable skills.

Socialism

Socialism is an economic system where everyone in society equally owns the factors of production. That ownership is acquired through a democratically elected government or through a cooperative or a public corporation within which everyone owns shares. The four factors of production are labour, capital goods, natural resources, and, within the modern era, entrepreneurship.

Socialism is an economic system in which the factors of production are valued in relationship to their usefulness to people. Socialists take into account both individual needs and greater social needs. They allocate resources using central planning, as in a command economy.

Examples of greater social needs include transportation; defence, education, health care, and preservation of natural resources. Some also define the common good as caring for those that can't directly contribute to production. Examples include the elderly, children, and their caretakers.

A mantra of socialism is, "From each according to his ability, to each consistent with his contribution.

Pros of Socialism

Under socialism, workers are no longer exploited because they own the means of production. Profits are spread equitably among all workers according to their individual contributions. But the cooperative system also provides for those that can't work. It meets their basic needs for the good of the whole society.

Cons of Socialism

The biggest disadvantage of socialism is that it relies on the cooperative nature of humans to figure. It ignores those within society who is competitive and focus on personal gain. Those people tend to seek ways to overthrow and disrupt society for his or her own benefit. Capitalism harnesses this "Greed is good" drive. Socialism pretends it doesn't exist.

As a result, socialism doesn't reward people for being entrepreneurial. It struggles to be as innovative as a capitalistic society.

Mixed Economy

A mixed economy is a system that combines characteristics of market, command and traditional economies. It benefits from the advantages of all three while suffering from few of the disadvantages.

A mixed economy has three of the subsequent characteristics of a market economy. First, it protects private property. Second, it allows the free market and therefore the laws of supply and demand to determine prices. Third, it's driven by the motivation of the self-interest of individuals.

It allows the Government to safeguard its people and its market. the govt. has a large role in the military, international trade, and national transportation.

The government’s role in other areas depends on the priorities of the citizens. In some, the govt. creates a central plan that guides the economy. Other mixed economies allow the govt. to have key industries. These include aerospace, energy production, and even banking. the govt. can also manage health care, welfare, and retirement programs.

Most mixed economies retain characteristics of a standard economy, but those traditions don't guide how the economy functions. The traditions are so ingrained that the people aren’t even aware of them. for instance, they still fund royal families. Others invest in hunting and fishing.

Advantages of a mixed economy

A mixed economy has the advantages of a market economy. First, it distributes goods and services to where they're most needed. It allows prices to live supply and demand.

Second, it rewards the most efficient producers with the highest profit. that means customers get the best value for his or her dollar. Third, it encourages innovation to meet customer needs more creatively, cheaply or efficiently.

Disadvantages of a mixed economy

An economy also can take on all the disadvantages of the other sorts of economies. It just depends on which characteristics the mixed economy emphasizes.

For example, if the market has too much freedom, it can leave the less competitive members of society without any government support.

Central planning of government industries also creates problems. The defence industry could become a government-subsidized monopoly or oligarchy system. that would increase the country's debt, slowing down economic growth within the long run.

2.7 Impact of business on Private sector, Public sector and Joint sector

1. Increase in market competition –

2. More demanding consumers

3. Market orientation

4. More advanced technology

5. Representation of state

6. Market orientation

7. More exports

8. Improved working conditions for workers

2.8 Emerging Sectors

Emerging Sectors – India While the world may recognize India for its IT and biotechnology capabilities, there are other sectors of interest to small to medium entrepreneurs which have made impressive strides in the last few years. India has many fast emerging sectors that present ample opportunity for entrepreneurs.

Here’s a glance at some of them:

Infrastructure - India's infrastructure growth has been exponential over the past decade. Today, we are the fourth largest and doubtless the second-fastest growing economy, with infrastructure being one among the cornerstones. The infrastructure industry in India is very fragmented and hence difficult to gunge its exact size and therefore the jobs it generates annually in absolute terms.

However, be it roads and highways, railways, aviation, shipping, energy, power or oil & gas, the Indian government and therefore the various state governments seem to creating rapid progress. This has led to significant employment generation, though a majority of it's still within the unorganised sector. Over subsequent 10 years, the infrastructure sector in India will get to continue its growth momentum and is probably going to maintain a growth rate anywhere between 7-10%, a really healthy sign.

Information technology - The IT sector has been India's sunshine sector for quite a while now. The industry has contributed considerably to changing India's image from a slow developing economy to a worldwide player in providing world class technology solutions.

Food Processing - The Indian food processing industry is a high priority sector and is poised for excellent growth within the coming years because it holds the vital link between agriculture and industry. India is the world’s largest producer of food after China. With increasing impetus by the govt. on research, it's estimated that India’s food production is likely to double within the next decade. These release huge opportunities in food processing areas like canning, packaging, frozen foods and thermos processing.

Healthcare - India’s healthcare sector has been growing rapidly driven by variety of factors like increasing the average life expectancy and average income level and rising awareness for health insurance. The Indian healthcare industry, which comprises hospitals, medicines, infrastructure, and medical devices, outsourcing telemedicine, health insurance and medical equipment is anticipated to achieve US $100 billion soon.

Tourism- India’s tourism industry is experienced a powerful period of growth, driven by the burgeoning Indian middle class, growth in high spending foreign tourists, and coordinated government campaigns to market ‘Incredible India.’ The tourism industry in India is substantial and vibrant, and therefore the country is fast becoming a significant global destination. India’s rich history and its culture and geographical diversity make its international tourism appeal large and diverse. India may be a country with diversified culture and traditions. The natural great thing about India, festivals, dresses, heritage, sites of India are very popular among tourists. this stuff fascinates travellers to return here. India has numerous science blesses places like Kerala, Shimla. These places are prime attraction of travellers from across the globe.

Retail - The Indian Retail Industry is that the largest among all the industries, accounting for over 10 per cent of the country’s GDP and around 8 per cent of the employment. The Retail Industry in India has come forth together of the most dynamic and fast paced industries with several players entering the market. But all of them haven't yet tasted success due to the heavy initial investments that are required to break even with other companies and compete with them. The India Retail Industry is gradually inching its way towards becoming subsequent boom industry

More emerging sectors

• Education sector

• Energy sector

• Animation sector

• Automobile sector

• Textile sector

• Organic farming

• Biotechnology

2.9 Challenges faced by Indian Economy

The following points highlight the major problems of the Indian economy. a number of the issues are:

• Low level of national income and per capita income:

Economic growth of any country is viewed from its level of national income and per capita income.

It is said that higher the level of national income, higher is the rate of economic growth.

India’s net national product (NNP) at factor cost in 2007-08 at 1999-2000 prices stood at Rs 27,60,325 crore. Population during the time stood at 1124 million.

• Vast inequalities in income and wealth:

Not only per capita income is low, but Indian economy is additionally marked by great inequalities within the distribution of income and wealth. In India, as years roll on, inequalities are on the rise. The logical corollary of this inequality is mass poverty. Nearly 60 p.c. of the entire population share one-third of India’s national income while only rich 5 p.c. of the entire population enjoy the same amount of national income.

• . Predominance of agriculture:

Less developed countries live mainly upon agriculture and extractive industries, like mining, fisheries and forests. Predominance of agriculture is explained from the point of view of sectorial composition of national income and occupational pattern.

• Tremendous population pressure:

In LDCs, the rate of growth of population is extremely high. so far as the size of population is concerned, India ranks second next only to China (1312 million in 2006). India’s population is now 1110 million in 2006- 07. During the last decade of 1991, the growth rate of population in India was 1.61 p.c. per annum, as compared to 0.7 p.c. rate of growth of population of developed countries.

High birth rate (23.5 per 1000) as well as low death rate (7.5. per 1000 in 2005-06) is the genuine cause for population explosion in India. in the 20th century, India’s population went up by 5 p.c. as against 3 p.c. increase within the world’s population as an entire.

• Massive unemployment:

In LDCs, not only natural resources are under-utilised but also a huge wastage occurs in the case of manpower resources. Slow economic process rate on the one hand, and rapid growth of population on the opposite hand, has accentuated the problem of unemployment in India.

• Scarcity of capital and low rate of capital formation:

As people in LDCs are poor, their capacity to save is low. This leads to a low rate of capital formation. That’s why development economists suggest that to break the vicious circle of poverty it's necessary to push up the rate of investment. Since India is a capital-poor country, capital per head is low. This scarcity of capital causes overall backwardness of the Indian economy.

• Underdeveloped infrastructure:

Being an LDC, India’s infrastructural facilities or economic and social overheads of capital are inadequate. It consists of (a) transport and communications, (b) energy, (c) finance, housing and insurance, (d) science and technology, and (e) health, education, etc.

• Low level of technology:

Due to illiteracy, use of advanced or sophisticated technology is quite an exception in India. due to the limited growth of technological institution, we are forced to use primitive methods of technology whose productivity is low.

More challenges

• Inflation

• Poverty

• Unemployment

• Social inequalities

• Sustainable growth

• Land reforms

• India china trade

• Trade deficits

References

1. Business Environment by Veena Keshav Pailwar
2. Business Environment by Dr. V.C. Sinha
3. Business Analytics by S.Christian Albright