Political Stability and Economic Growth: Reflections on Indian Economy

Efficient economic policies and their implementation are only sufficient conditions of assured economic growth. However, the type of political structure and stability of the same form the necessary conditions of economic growth for any nation. The political conditions should be ideal and conducive to the nature of the economy. This paper attempts to define political system and its inter-relation to economic development. It further progresses to define political stability under the adopted political system of an economy. It also attempts to explain a state of political instability and its channels of transmission on economic growth. Further, an attempt to define various measures of political stability is made and the significance and impact of the variables is mentioned. Political polarisation in India is higher as it has a multi-party system with two major political parties and many regional dominant parties. Thus, it is difficulty to take a unitary view on the question of political instability and economic growth.