INDIA IS SAVING WITHOUT GAINING

INDIA IS SAVING WITHOUT GAINING

 Households are putting their money in investments that don't help the government build a social safety net.

•  In India, savings are declining. generally savings needs to be equal to investments to maintain economic equilibrium.
• Gross savings has fell in 2020-21 to 27.8 per cent of Gross National Disposable Income (GNDI), from 31.7 per cent of GNDI in 2017-18.
• RBI data shows, even if 3.8 per cent as a proportion GNDI has surged, this is not the kind of numbers India wants.
• Household financial savings rose to 15.5 per cent in 2020-21 and this contributed to a 50 per cent increase in deposits compared to previous year.
• Covid outbreak forced people to go for precautionary savings.
• Desire for pension and market products did not change.
• Investments in shares and debentures rose just 0.1 per cent points  from 0.4-0.5 per cent of GNDI in 2020-21.
• Savings in insurance products rose from 1.8 to 2.6 per cent during this period.