Going by the market exchange rate statistics, India business economy is the twelfth largest in the world and on the basis of purchasing power parity (PPP) India occupies the fourth slot. Renewal of economic developments and improved economic policy in the year 2008 has helped India's economic growth rate to gather momentum. 2008 witnessed India occupying the second slot in terms of world's fastest developing economy.
What does the statistics say?
- India's per capital income ranks 142th in the world at $1016
- Per capita (PPP) of India stands at 129th amounting to US$2,762
- As per the financial records of 2007 with WTO, India accounts for 1.5% of World trade
- In the year 2006, India's total merchandise business was worth $294 billion, according to World Trade Statistics of the WTO
Despite vigorous economic expansion, India is still facing major hurdles widening the economic inequality across the nation. According to Goldman Sachs' prediction India will continue to linger a low-income nation for many more decades with per capital reasonably less that it's other BRIC counterparts.
Indian business sectors
Industrial and service sector– Accounting for 29% of India's GDP and 28% of employment, India ranks 16th worldwide in terms of nominal factory output and 15th in services output. Service sector on the other hand accounts for 54% of India's GDP.
Agricultural sector– India stands second in global farm output. In the year 2007, agriculture and related sectors like forestry, fishing and logging accounted for 17% of GDP and 60% of the employment. The sector plays an important role in the socio-economic up gradation of India, in spite the sturdy deterioration of its contribution in the GDP. The comparison between the indigenous yields with the international counterparts reveals that Indian average give away is 30% to 50% highest in the world.
Banking and Finance– Money market in India is divided into two sectors – the organized sector (constituting private, public and foreign owned cooperative and commercial banks) and unorganized sector (constituting family or individually owned bankers and non-banking financial companies). The public sector banks possess around 75% of overall assets of the banking sector, with the private and foreign banks seizing 18.2% and 6.5% respectively.
FDI in Indian economy
India is the most favorable destination for the foreign investors who are willing to start their business in a nation which has a middle class population of 50 millions, indicating an expanding consumer market. The nation's strength lies in Information technology, chemicals, apparels, pharmaceuticals and jewellery. Moreover, it has a large team of well-qualified and world class business managers and executives.
According to the government's Secretariat for Industrial Assistance, FDI infusion into India touched a benchmark of $19.5 billion in fiscal year 2006-07 (April-March) which was reportedly double than the total of US$7.8bn in the previous financial year. The FDI traffic for FY 2007-08 has been accounted as $24 billion and for FY 2008-09 it is anticipated to touch $35 billion.
Economic trends to be pursued by India
Based on improved growth and increased FDI traffic, Goldman Sachs forecasts that from 2007 to 2020 India's GDP per capita in context of US$ will multiply and the Indian economy will supersede the US by the year 2043 if the Indian government follows few guidelines directed by Goldman Sachs.
- Develop authority
- Elevate educational realization
- Improve quality and quantity of educational institutes
- Monitor inflation
- Initiate a convincing economic policy
- Liberalize monetary markets
- Amplify trade relations with neighbors
- Increase agricultural efficiency
- Perk up infrastructure sector and
- Develop ecological quality