Economy of India
Economy of India
The Economy of India is the tenth largest in the world by nominal GDP and the third largest by purchasing power parity PPP . The country is one of the G 20 major economies, a member of BRICS and a developing economy that is among the top 20 global traders according to the WTO. India was the 19th largest merchandise and the 6th largest services exporter in the world in 2013; it imported a total of $616.7 billion worth of merchandise and services in 2013, as the 12th largest merchandise and 7th largest services importer. India s economic growth slowed to 4.7 Percent for the 2013 14 fiscal year, in contrast to higher economic growth rates in 2000s. The Indian Finance Ministry projects the GDP growth for fiscal 2014 will be 5.5 Percent. IMF projects India s GDP to grow at 5.6 Percent over 2014 15. Agriculture sector is the largest employer in India s economy but contributes a declining share of its GDP 13.7 Percent in 2012 13 . Its manufacturing industry has held a constant share of its economic contribution, while the fastest growing part of the economy has been its services sector which includes construction, telecom, software and information technologies, infrastructure, tourism, education, health care, travel, trade, banking and other components of its economy.
The post independence era Indian economy from 1947 to 1991 was a mixed economy with an inward looking, centrally planned, interventionist policies and import substituting economic model that failed to take advantage of the post war expansion of trade and that nationalized many sectors of its economy. India s share of global trade fell from 1.3 Percent in 1953 to 0.5 Percent in 1983. This model contributed to widespread inefficiencies and corruption, and it was poorly implemented.
After a fiscal crisis in 1991, India has increasingly adopted free market principles and liberalised its economy to international trade. These reforms were started by former Finance minister Manmohan Singh under the guidance of Prime Minister P.V.Narasimha Rao. They eliminated much of Licence Raj, a pre and post British era mechanism of strict government controls on setting up new industry. Following these economic reforms, and a strong focus on developing national infrastructure such as the Golden Quadrilateral project by former Prime Minister Atal Bihari Vajpayee, the country s economic growth progressed at a rapid pace, with relatively large increases in per capita incomes. The south western state of Maharashtra contributes the highest towards India s GDP among all states, while Bihar is among its poorest states in terms of GNI per capita. Mumbai,Maharashtra is known as the trade and financial capital of India.