The world's 2nd most populous state having 17.5% of the world's population.
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1 India. The world's largest democracy. The world's 2nd most populous state having 17.5% of the world's population. The 12th largest GDP in terms of nominal value and 4th highest in terms of purchasing power parity. These are a few points which showcase on the most powerful and progress countries of Asia- India. After gaining independence from the British rule in 1947, India has gradually emerged as a potent force in the global scenario and is making waves across the world. At the time of its independence, India was primarily an agricultural state. But with reforms and liberalization policies over decades, India has become an important hub for business on the world map. Service industry forms 63% of the economy and gives employment to around 34% people in India. On the other hand, agriculture, which is still the most important occupation, contributes to around 52% of the GDP, by employing 17% of the workforce. The Indian industry is also an 1 / 5
2 important sector as it contributes 20% of the GDP and supports and employs 14% of the working population. Thus, for a country with a population of over 1.2 billion, the figures are simply mind boggling. The Indian economy has largely fluctuated over the centuries and has been controlled by historical events like the British colonial rule. Around 1700 AD, India formed 22% of the world income which diminished to 3.8% by the time it gained independence, largely due to drain of wealth through revenues and taxes by the rulers. Even after independence, various factors had tied down the Indian economy. From 1947 to 1991, protectionism, industrialization, state intervention, large public sector, license raj etc. hurt the Indian economy. However, post economic liberalisation in 1991, the face of the Indian economy has changed for the good. New policies like deregulation, international trade, FDI's, BSE & NSE for trading of stocks etc have all put India back on the world map for doing business. Overview An overview of the major sectors alongwith growth, problem and challenges is discussed below: Agriculture sector is the back bone of the Indian economy as it supports over half the population and contributes around 17% to the GDP. This sector includes forestry, logging, fishing etc. India is the leading producer of milk, tea, nuts, ginger, coconut and pepper, alongwith having the largest cattle in the world. Apart from this, India ranks 2nd in the production of wheat, rice, sugar and groundnut. However, agriculture is a neglected sector as it faces problems like price risks, lack of infrastructure, dependence on external factors etc. 2 / 5
3 Industries contribute to around 20% of the GDP in India. People are employed in industries including mining, quarrying, petroleum, oil, natural gas, electricity etc. The Services sector has grown in leaps and bounces since the turn of the 21st century and contributes to around 53% of the GDP. India is one of the leaders in Information Technology, BPO service, IT enabled services etc which have seen a constant growth. Indian Banking Industry and financial institution are also a very important part in the Indian economy. India has 28 public sector banks, 29 private banks and around 31 foreign banks. Apart from this, there are roughly about branches and over ATM's. Challenges However, the other side of the coin paints a bleak picture of the Indian economy. 3 / 5
4 Around 85% of the people in India have less than $2.5 PPP per day. 75% of the population earns less than $2 per day, and over 24% earn less than $1 per day. 41% of the Indian population earns less than the international poverty line of $1.25 per day. Also, 27% of the population is below the national poverty line $1 per day. The infrastructure in India is also below the international standards as over 600 million people don t have access to electricity, 80% don t have electrical lines, 65 million are extremely poor etc. Thus, these are some problems which need to be prioritized and should be tackled before they grow beyond control. Govt. policies like Aam aadmi including NREGA, Public Distribution System etc would only help India emerge stronger. In India, there are is parallel life which the citizens live. On one hand there are all the luxuries of life to the people in the urban areas, on the other hand there is darkness prevailing in the rural 4 / 5
5 areas where mere survival is a challenge. However, despite all odds, if India can overcome these hurdles with well thought out plans and proper implementation, then no can stop India in becoming an unstoppable global economic super power. 5 / 5
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