India's Transition to Knowledge Economy

Topics: Economy, Economics, Economies Pages: 15 (4068 words) Published: June 20, 2013
India’s Transition To Knowledge Economy : Opportunities and Challenges- The Way Forward to 21st Century By
V P Raghavan

Abstract

Economies around the world in recent past have been reshaped by technology and globalization . Economic globalization and advances in information and communication technologies (ICTs) led to the emergence of knowledge economy – an economy that creates , disseminate and uses knowledge to enhance its growth and development.

Knowledge economy is one in which production and utilization of knowledge play a crucial role in creating wealth. Knowledge becomes the core of economic development in knowledge societies. Economic activities in knowledge societies are triggered by information, which forms the basic input for producing wealth. Higher growth rates of service sector in relation to manufacturing and agriculture characterize the new knowledge economy. Services are increasingly integrated to all productive activities in knowledge economies .

ICTs today encompasses almost all spheres of human endeavour.. ICT sector exlands by leaps and bounds and resultantly it raises production to a greater extent and generates employment opportunities in manufacturing of IT related products. The use of ICT helps raise labour productivity , growth and employment in agriculture , manufacturing and service sectors as well. The structure of traditional market system has been reframed with greater penetration of ICTs and revolutionary changes have been taken place in the nature of human development by improving their quality of life with ICT oriented livelihood and life style initiatives.

India has a greater advantage in gaining on knowledge economic potentials. It has a larger number of English speaking educated youth . It is her demographic dividend , which no other country can have in the world. India has got a dynamic private sector with greater entrepreneurial skills. India’s is the largest market in the world. India’s free market economy is another added advantage. It has a well developed financial and banking sector. The country has highly developed science and technology institutes. In order to encash these dividends we may reorient the system of economic governance to find favour with the changing global scenario.

Knowledge has now become the means to raise India the economic super power. We may able to feed the global people by increasing the food grains production with the help of gaining knowledge resources, for which we need to train our agriculturists to tap benefits of bio technology for their agricultural operations. India has a good choice to launch a new pathways of growth for its future progress. The emerging knowledge economy of India opens up new avenues for lifting people out of poverty by enhancing overall productivity and increasing per capita income.

To become a forerunner in the globalized knowledge economy of the 21 century India should gear its enlarging market economy towards a more competitive roadways by focusing its efforts on further liberalization of economic engagements. Road blocks of relentless economic expansions may be removed. Stringent regulatory formalities may be dispensed with.

To reap the benefits of the expanding horizons of the global knowledge economy , India should put forward the economic reforms with greater emphasis on fine tuning of policy-mix. India missed Industrial Revolution for her policy failures. But India can win Knowledge Revolution with the judicious blending of talents, expertise and economic achievements.

Key words: Knowledge Economy, Human capital, Information and Communication Technology

1.Introduction

Economies around the world in recent past have been reshaped by technology and globalization (McKinsey,2012). Economic globalization 1 and advances in information and communication technologies (ICTs)2 led to the emergence of knowledge economy – an economy that creates , disseminate and uses...

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Mahajan, Sidharth, Ashoka Chandra and Mainak Sarkar, 2009, “ An
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OECD ( Organization for Economic Cooperation and Development),
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UNCTAD, 2012, World Investment Prospects Survey.2010-12
World Bank,2005, India and the Knowledge Economy: Leveraging Strenths
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