India: Growth of the real gross domestic product (GDP) from 2nd quarter 2021 to 2nd quarter 2023

January 17, 2024

India: Growth of the real gross domestic product (GDP) from 2nd quarter 2021 to 2nd quarter 2023

India: Real gross domestic product (GDP) growth rate from 2018 to 2028

The data illustrates the progression of India’s real gross domestic product (GDP) from 2018 to 2023, with projections extending to 2028. GDP represents the total market value of goods and services produced within a country annually, serving as a crucial gauge of its economic prowess. Real GDP, adjusted for price fluctuations, stands as a pivotal indicator for economic expansion. In 2023, India experienced a real GDP growth of approximately 6.33 percent compared to the preceding year.

The Growth Rate of Gross Domestic Product (GDP) in India Recent years have marked a shift in economic influence toward the burgeoning economies of the BRIC nations—Brazil, Russia, India, and China. The GDP growth rates in these countries far surpass those in traditionally dominant economies such as the United States and Germany.

While the United States boasts the title of the world’s largest economy by nearly every metric, China secures the second-largest share of global GDP, with India in close competition with Japan for the third-largest position. Despite the global recession in 2008 and 2009, India demonstrated remarkable GDP growth rates, particularly when much of the world faced negative growth in at least one of those years.

A contributing factor to India’s success is the economic liberalization initiated in 1991, fostering trade and dismantling certain public monopolies. Although GDP growth has decelerated in recent years, partly due to surging inflation, India’s workforce is expanding, especially in the industry and services sectors, driven in part by international outsourcing—a lucrative venture for the Indian economy. The agricultural sector in India remains a global force, surpassing all nations in wheat or tea production except for China. However, despite mechanization and a rapidly growing population, India’s unemployment rate remains relatively high.

India: Estimated gross domestic product (GDP) per capita in current prices from 1987 to 2028(in U.S. dollars)

The data illustrates India’s GDP per capita from 1987 to 2028, reaching approximately $1,913.22 in 2020. In comparison, China’s per capita GDP was around $6,995.25 in 2013. India’s economic growth stems from global reliance on its cost-effective production. The economy, driven by agriculture, manufacturing, and services, experienced a surge in GDP per capita due to population growth and employment demands. Despite significant gains since the mid-2000s, India faced economic stagnation around 2012, leading to decreased growth and currency value. Recent pessimism among residents reflects concerns about the future economy, potentially affecting consumer confidence. Noteworthy exports include agricultural products, jewelry, chemicals, and ores, while imports focus on crude oil, gold, and precious stones for the jewelry industry. Despite limited goods exports, India remains one of the world’s largest exporters.

India: Share of global gross domestic product (GDP) adjusted for Purchasing Power Parity (PPP) from 2018 to 2028

In 2023, India’s share of the global gross domestic product (GDP), adjusted for purchasing power parity (PPP), reached 7.51 percent, with a projected increase to 8.76 percent by 2028. This growth is indicative of India’s expanding economy, buoyed by the rupee’s lower purchasing power, contributing to its favorable ranking.

The Indian Economy A substantial part of India’s economic expansion results from a workforce shift from agriculture to the more productive service sector. This transition gains significance due to India’s massive population, meaning changes in its economy impact a considerable portion of the world’s population.

Understanding PPP The Economist magazine employs the Big Mac Index to illustrate purchasing power, where the uniformity of the product across countries should reflect local currency purchasing power. This statistic uses prices of standard goods (excluding the Big Mac) adjusted to the same level based on their local currency prices. This equalization creates purchasing power parity, offering a relative measure of the size of the Indian economy if the entire world operated with Indian rupee price levels.

India: Distribution of gross domestic product (GDP) across economic sectors from 2012 to 2022

In 2022, the services sector accounted for nearly half of India’s GDP, marking a gradual and consistent increase over the past decade. Key players in the country’s services industries include telecommunications, IT, and software.

The Significance of IT The IT industry holds a crucial role in India’s economy. In the fiscal year 2016/2017, it contributed approximately 8 percent to India’s GDP, slightly lower than previous years when it constituted about 10 percent of the nation’s economy. Despite this decrease, the IT industry exhibits growth, evident in its rapidly rising revenue and employment numbers. IT encompasses software development, consulting, software management, online services, and business process management (BPM).

Workforce Dynamics While employment in IT, and consequently the services sector, is experiencing an upswing, the majority of the Indian workforce remains engaged in agriculture. However, there is a discernible trend indicating a shift in this distribution. Currently, most Indians still reside outside cities – where IT jobs are concentrated – but urbanization is steadily increasing.

LinkedIn Post Description

India’s Economic Journey:

1. Real GDP Growth (2018-2028): Explore the dynamic growth of India’s real GDP from 2018 to 2023, with projections reaching 2028. Real GDP, a key economic indicator, adjusted for price changes, showcases India’s economic strength with a 6.33% growth in 2023.

2. Global Economic Shift: Witness the rise of BRIC nations—Brazil, Russia, India, and China—surpassing traditionally strong economies. Despite challenges, India’s remarkable GDP growth, fueled by economic liberalization since 1991, sets the stage for its global impact.

3. GDP Per Capita Trends (1987-2028): Dive into India’s GDP per capita journey, reaching $1,913.22 in 2020. Compare with China’s $6,995.25 in 2013, understanding India’s economic evolution driven by cost-effective production and a diverse economic landscape.

4. PPP-Adjusted Global Impact: Uncover India’s share of global GDP adjusted for Purchasing Power Parity (PPP), reflecting a rise from 7.51% in 2023 to a projected 8.76% by 2028. The lower purchasing power of the rupee contributes to India’s favorable global standing.

5. Sectoral Evolution (2012-2022): Explore the shift in India’s GDP distribution across economic sectors, with the services sector accounting for nearly half in 2022. Telecommunications, IT, and software emerge as key players, showcasing India’s economic diversification.

6. IT Industry’s Role: Understand the significance of the IT industry, contributing 8% to India’s GDP in 2016/2017. Despite a slight decrease, the industry shows growth, influencing workforce dynamics. Witness the evolving landscape as India moves towards urbanization.