Let us know about the causes of the crisis and methods adopted to come out of the crisis. Lets see the impact of this crisis.
This article is broadly focusing on two aspects:
a) Impacts on Greece.
b) Impacts on India.
Impacts on Greece
a) Due to the harsh austerity measures employed by the country the tax rates are at all time high. 45% is the highest income tax slab + not to forget the social security tax at 15%. So a person earning a good income will shell out 60% of his income towards taxes.
“Why should I work if I am paying almost everything I earn to the government?”
b) Number of shops are being closed, unemployment is at a all time high of 20%.
“Greece is a very small nation, say something about the size of a state in India. 20% unemployment is very high for such countries."
c)The main industries of Greece tourism and shipping are facing extreme difficulties.
“People are not traveling to Greece, no body is interested to buy ships in the current financial crunch.”
d) People are moving out of Greece in search of employment opportunities.
e) Wide spread riots on every austerity measure imposed by the government.
f) There is no political opposition party strong enough in Greece after the crisis.
And so on.
Impact on India
Is there an impact on India is what we are all interested in.
a) There is no material impact on India. RBI is a very strong regulatory authority in our country. Moreover, we have a lot of foreign reserves. This gives us an opportunity to come out of any forthcoming crisis.
b) One best impact is more and more people who were investing in Europe are bringing their investments in BRIC nations.
c) More opportunities are being opened for India, which it should capitalize on.
d) We have to learn from Greece and see that it doesn’t happen in India.