1. Introduction to Financial Market A financial market is a platform or system where individuals, companies, and governments can buy and sell financial assets like stocks, bonds, currencies, and derivatives. Essentially, it is the backbone of the economy because it facilitates the flow of funds from those who have surplus capital (savers) to those who…
Introduction A central bank is the apex monetary authority in a country, responsible for controlling the supply of money, regulating credit, stabilizing prices, and maintaining economic stability. Examples include the Reserve Bank of India (RBI), the Federal Reserve (USA), the Bank of England, and the European Central Bank (ECB). Monetary fluctuations, such as inflation, deflation,…
Introduction Economic inequality refers to the unequal distribution of income, wealth, and opportunities among individuals or groups within a society. While some level of inequality is inevitable in a market-driven economy, excessive economic disparity can threaten social cohesion, reduce economic efficiency, and impede sustainable development. In contrast, inclusive growth emphasizes equitable access to economic opportunities,…
Introduction The Reserve Bank of India (RBI), established in 1935, is the apex monetary authority of the country. As the central bank, it is entrusted with the responsibility of regulating the supply of money, supervising the financial system, and ensuring economic stability. Among its multiple roles, one of the most crucial is maintaining monetary stability,…
Introduction Economic stability is vital for the sustainable growth of any nation. Two critical phenomena that influence the health of an economy are inflation and deflation. Both affect purchasing power, production, employment, investment, and overall economic growth, but in opposite ways. Understanding the causes, consequences, and policy responses to both is essential for students, policymakers,…
Introduction Monetary policy is a critical component of a country’s macroeconomic management. It involves regulating the money supply, interest rates, and credit availability in the economy to maintain price stability, ensure adequate liquidity, and foster economic growth. In India, the Reserve Bank of India (RBI) is entrusted with the responsibility of formulating and implementing monetary…
India has set an ambitious goal of becoming a $5 trillion economy, a vision that represents its aspirations for rapid economic expansion, global competitiveness, and improved living standards. The government has undertaken key structural reforms, policy measures, and sectoral advancements to accelerate growth, but significant challenges remain. This article critically analyzes India’s progress toward achieving…
A nation’s economic growth and development depend heavily on how its government allocates financial resources through the annual budget. The budget determines the course of public spending, taxation, investment in key sectors, and social welfare initiatives, all of which shape economic stability and progress. In India, the Union Budget is a crucial policy instrument that…
A fiscal deficit is an essential concept in the field of public finance and plays a critical role in understanding a country’s economic health. In simple terms, a fiscal deficit occurs when a government’s total expenditure exceeds the revenue that it generates, excluding borrowing. It is often expressed as a percentage of a country’s GDP…
Inflation is one of the most critical macroeconomic challenges affecting India’s economy. It refers to the sustained increase in the general price level of goods and services over time. While moderate inflation is considered beneficial for economic growth, high and persistent inflation erodes purchasing power, increases the cost of living, and creates financial instability. In…