Savings and Investment

The rate of growth in GDP has been constrained as investment has not been increasing at a satisfactory rate, especially by the private sector. The gap between savings and investment has been widening. Moreover, the incremental capital output ratio (ICOR)2 has deteriorated continuously in the past few years, indicating that the country has not been able to boost productivity of investment. The gap between savings and investment has increased over time. The government initiatives seem to be ineffective in

GROWTH, SAVINGS AND INVESTMENT

Several policy-induced macroeconomic challenges have severely restricted the maintenance of upward mobility of rate of growth in the recent fiscal years and the continuation of progress in different social sectors. The challenges have partly been the result of lack of farsightedness and creativity in policy making, resulting in fiscal and monetary mismanagement. 2.1 The Scenario of Growth The government has already reviewed many macroeconomic targets in FY 2014-18 that are set in the Medium Term