We live in a fast-forwarding age where frequent decisions take place in a short period. Especially in the post-COVID-19 period, things have taken a gradual turn with new sectors and new niches of research coming up. The various sectors are experiencing major changes in a short period. From the fields of business to technology, entertainment to the economy, various swift decisions are being taken which will ultimately lead to a better future. In the economic sector, various countries are observing various trends and pitfalls of the COVID-19 period. The pandemic has largely affected the economy of the world and this has led to various decisions taken by the central banks globally to control the disadvantages of the results of the pandemic. Here are a few trends that are noticed all over the year 2022.
India’s strong march in the defence sector
The government has taken a number of steps to make India self-reliant in the defence sector.
At this time, India is not only reducing ammunition imports but also exporting Indian ammunition to the rest of the world.
In support of the ‘Make in India’ campaign, India is developing projects based on indigenous technology such as missile systems, artillery gun systems, and anti-tank guided missiles.
On the other hand, the government has granted 351 companies over 500 defence industrial licences. Along with this, the Indian government is working on the Defense Corridor project.
The Indian Navy also received its first indigenous aircraft carrier, INS Vikrant, in 2022.
Increase in the Repo-Rate
To reduce the flow of currency in the economy and to reduce the demand, the Reserve Bank of India, or the RBI started increasing the repo rate in May 2022. The Reserve Bank of India has put a hike on the repo rate from 4 percent to 6.25 percent in the financial year 2022. Due to this hike, the EMI has increased by +20 percent this year as compared to last year. It has been extremely difficult to control inflation and the Reserve Bank of India has a lot to move in the journey of controlling inflation.
Introduction of the Digital Currency
India’s first Digital Currency — the Digital Rupee — has been launched by the Reserve Bank of India on 1st November 2022. The first trial for digital currency has been ordered to take place in four cities in India on 1st December 2022. Digital wallet, offered by banks, aims to use digital currency. The digitalization of the Indian Currency aims at improving the digital currency of India and will help in simplify payment operations. This will also aim at reducing the dependence on cash currency.
The announcement of the Reduction of Excise Duty
The high costs of petrol and diesel created financial problems for the people. Due to this, the Government of India ordered a cut in the price of petrol by Rupees 8 per liter and in the price of diesel by rupees 6 per liter on 21st May 2022. In March 2022, the price of petrol and diesel was extremely high due to the Russia-Ukraine conflict. This had an immense effect on the price of petrol and diesel.
Throughout 2022, the global economy has deteriorated significantly with the high rates of inflation, monetary crisis, and uncertainties due to the pandemic and the Russia-Ukraine war. Hikes in the prices of food and energy have led to a global crisis in the cost of living and exhausting real income. Large-scale borrowings by the government and capital outflows are responsible for the rise in fiscal and balance of payment pressure in developing countries. The businesses deterioration in developing countries is a major problem that is just on the way to recovery from the pandemic. International food and energy prices remain at their peak and major changes are not on the line of witnesses. The uprising pressures of prices are affecting countries with larger populations in a great way.
Central banks in many developed countries aim to make a soft landing for their economies that aim at controlling inflationary rates.
It can be observed that throughout the year 2022, numerous outcomes have been noticed widely and the decisions are taken based on the prevalent circumstances. It becomes very important to keep track of the global scenarios, especially in the field of economics and the policies of the different countries. Global inflations are expected to witness several changes and fluctuations in the years to come with the outcomes of the decisions of the central banks worldwide. The global economy is seen to change its shape in the years to come.
