ABSTRACT

                          India's economic growth is expected to pick up a faster pace in 2013-14 and record six per cent plus levels of gross domestic product (GDP), according to Mr C Rangarajan, Chairman, Prime Minister's Economic Advisory Council (PMEAC).India was reported to expand at a better rate as compared to its three BRIC peers China, Russia and Brazil in May 2013, as per a survey by HSBC. India was also ranked amongst the top 20 real estate investment markets globally with investment volume worth Rs 190 billion (US$ 3.05 billion) recorded in 2012, according to Cushman & Wakefield's report ‘International Investment Atlas’.

In spite of all these achievements Indian economy is peculated with some macro economic challenges which hinders the growth of economy. Efforts are been made to rectify these challenges like lowering of unemployment level by introducing various schemes and plans , curbing of inflation rate and controlling the performance of business cycle. These problems arise when the macro economy does not satisfactorily achieve the goals of full employment, stability, and economic growth. Unemployment results when the goal of full employment is not achieved. Inflation exists when the economy falls short of the stability goal. These problems are caused by too little or too much demand for gross production. Unemployment results from too little demand and inflation emerges with too much demand. Stagnant growth means the economy is not adequately attaining the economic growth goal. Each of these situations is problematic because society is less well off than it would be by reaching the goals.

This paper focuses on the macro economic challenges which is been faced by the economy and ways which can be adopted to curb these problems. This paper also focus on how such macroeconomic challenges operate in practice, and how they interact with each other, especially in terms of their effect on growth, macroeconomic stability, and resilience to shocks.

Key words : Macro Economic problems, unemployment, Inflation ,Stagnant growth ,Business Cycle