Business Environment by Pearson

182 | Business Environment

GDS, as a proportion of GDP, continued to improve, rising from 26.4 per cent in 2002–03 to

34.8 per cent in 2006–07, with an average of 31.4 per cent during the Tenth Five-Year Plan.  e

savings–investment gap which remained positive during 2001–04 became negative, therea er.

In modern economy, the excess of domestic savings over domestic investment suggests a de a-

tionary situation in which the demand has not kept pace with the increased capacity.  us, the

reversal of the savings–investment balance should be viewed as a correction of the domestic, sup-

ply–demand balance, occurring through an above-normal (and welcome) ...