Background

Over the past 18 months, the optimistic mood within India’s economy has taken a dip.
While the GDP slowdown has been relatively recent, India has been battling with a rising inflation for the past two years, which included food inflation at between , The Rupee depreciation - to become one of the poor performing currencies in the international market. Although the Eurozone crises and U.S. economic slowdown has contributed to the slowdown, and reduced demand.
Other factors that have contributed to growth challenges:
• Sector diversification - - poor agricultural output – need more sectors other than service industry for growth advancement.
• Infrastructure deficit, Energy – underutilization and distribution system being uneven
• Education & Health - low spending
Issues
Regional Disparity – Different tax and state laws – not conducive for firms to expand /foreign companies to enter
Political instability – Governance issues - power seems to lie everywhere, but in the center
Corruption and lack of confidence among corporates

1. How have politics and economics affected one another in India?
Politics and economics of a country are interlinked. A country which is has political uncertainty has lack of economic integration and disruptive politics is bound to have problems in the development of the economy – poor investments etc
In India in the last 18 months the role bad Politics & corruption has played, has definitely caused an economic slowdown as the opposition parties disrupting every move of the ruling party. Ruling party image tarnished with corruptions. All these have led to loss of confidence in the political system
The Government announced a fiscal deficit figure of 4.9% of GDP on May 31 2013, slightly lower than its own budget estimates.

2. What further economic reforms should Singh push forward?

Aprt from prudent