The Economics in India

The Economics in India

The Republic of India is one of the most resistant countries in the history. As a country that originated from conflicts and fights for territory, India resulted in a multilingual and multi-ethnic country that defies all odds to grow and thrive. Formerly a country that was ruled by the British, India faced a rapid development of infrastructure, economic decline and social problems, such as major famines. However, years later, India is one of the fastest-growing major economies countries in the world.

Currently the sixth largest economy by nominal GDP (Gross Domestic Product) and the third largest by PPP (Purchasing Power Parity), India has 2,134 per capita in GDP (nominal) and 7,783 in per capita GDP (PPP). Furthermore, with an annual growth of 6-7% average GDP, India has already surpassed major economies, such as China, and it is expected to achieve 7.3% 2018 to 2019, therefore, India has proven to be one promising country. Besides that, India is also expected to be one of the top three economic powers of the world in 10 to 15 years because of the young population, low dependency ratio, investment rates and increasing integration to the global market.

The fact that the country is multilingual, with English being one of the official languages, India is also capable to export and import services and labor. Therefore, lots of countries have been using India’s services to expand their reach because of the country’s “low wages” – which is quite controversial – and high-quality services, through the Make In India initiative, which aims to boost the manufacturing sector. With that said, it is important to note that the Indian currency is the Indian Rupee, and its value is quite low when compared to the American Dollar – 1 INR is 0.014USD -, therefore, there is a balance of trade, which is currently in favor of the US, but there is no big deficit for India.

Although India is quite known for its high-quality IT services, the country continues to grow in different parts of the economy. The employments are steadily rising – with an increase of 136.000 during 2017 to 2018 -, more and more startups are emerging and it is expected to have an average of 100.00 startups by 2025 – which will create employment for about 3.6 million people -, and, in 2018, the government decided to focus the budget on the rural economy and the agriculture sector. Furthermore, the government is also engaged in improving the quality of life of those who are economically less privileged, offering a better health care, an improved education and infrastructure creation. The government will spend a total of US$ 225.43 billion to achieve this goal.

India is a country that has such a long history of resistance and strength, the country faced extreme poverty and famine, but still managed to fight it and grow until it achieved its current state. There is no doubt that India has defied all odds when the country began to grow economically. However, it has set a goal and will not stop until it reaches it.