Meet India!

Modern India now has over 2000 ethnic groups. Modern Indian languages
have evolved from all the worlds four language families. Indo-European,
Dravidian, Austro-Asiatic and Tibeto-Burman. India has 1652 individual
mother tongues. 30 languages are spoken by over a million each, and
122 by over 10,000 each.
India has almost 1.2 billion people, and the Union of India consists of 32 States
and Union Territories. The biggest of these is Uttar Pradesh with a population of
199.6 million or 16.49% of Indias. It is as big as Brazil. The smallest political unit
is Lakshadweep which has just 64,000 (0.01%)
In late 2012 India became the worlds third largest economy in PPP terms
and has grown at an average rate of over 7.4% during 2004-14 and GDP from
about $750 bn to $2 trl. Between 2008-11 it grew at more than 9%. In consonance
with global trends Indias growth also has tapered off these past two years.
Clearly its a country of great heterogeneity, complexity and promise. Its diversity
makes it unsuitable for any other form of government but a very raucous
DEMOCRACY.
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The major contributors to WGDP growth 2000-10

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Who contributes how much to world growth 2010-19.

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But a fast take-off for India!

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Why everybody is excited about India?

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Indias rising youth (16-34 yrs) cohort 2000-2030.

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Is this the right education?

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Indias burgeoning middle-class.

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Indias late surge!

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Not a bad performance at all!

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Banking crisis.

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Former central bank governor Dr Y V Reddy once

quipped that while the future is always uncertain,
in India even the past is uncertain, given how
often the government revises economic data.
Even by that standard, however, the dramatic
upward revision of the GDP growth rate raises
questions about the credibility of data emanating
from Government and is fast making the CSO a
bad joke.

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Manufacturing has grown at 8.1 per cent at current prices. This is not
matched by the growth in the Index of Industrial Production (IIP), which
is only 2.4 per cent.
It is hard to explain how manufacturing growth has been so strong when
exports as a whole have contracted.
The Centre for Monitoring Indian Economy has pointed out, a big chunk
of the growth in 2015-16 has come from an item called discrepancies in
the CSOs statistics (in plain language, an item about which we know
little).
Of the growth of 7.6 per cent in 2015-16, 2.4 percentage points were
accounted for by discrepancies. In 2014-15, the same item accounted for
0.1 percentage points out of growth of 7.2 per cent.
Compare 2014-15 and 2015-16 after leaving out discrepancies and the
growth rate figures are: 7.1 per cent and 5.2 per cent. It is hard to be
jubilant about something you dont quite understand.
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Why 7% is such a high mountain?

Lower oil prices translate into higher private consumption. The
mid-year review estimated the boost to growth from higher private
consumption at 1-1.5 percentage points, assuming that oil prices
through the year would average $50 per barrel.
The Economic Survey estimated oil prices for 2016-17 to be $35 per
barrel. This assumption threatens to be undone. Oil prices have
already moved up to $50 per barrel. If they stay at this level, there is
every prospect that the gains in 2015-16 on account of falling oil
prices would be absent.
The Pay Commission hike could contribute about 0.6 per cent of the
GDP depending on how much of it is fully paid out in 2016-17.
A better monsoon could add about 0.3 percentage points.
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FDI trends.
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Sector-wise FDI inflows into India.

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Sector

Amount in Rs.
Crores

Percentage

2449.32

20.21

Telecommunications

531.95

4.39

Fuels (Power & Oil Refinery)

520.94

4.30

Transportation Industry

1417.13

11.70

Manufacturing

3213.02

26.52

Services

1823.86

15.05

Agriculture

107.86

1.00

2053.26

16.94

12117.36

100

Information Technology

Miscellaneous
Grand Total

Source: Rajya Sabha Unstarred Question No. 2341, dated on 23.03.2005.

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Share of FDI in China in Various Sectors.

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Sector
Agriculture and Mining

Share %
2.73

Manufacturing

70.95

Real Estate and Construction

11.08

Lease & Business Service

4.66

Production & Supply of Power, Gas & Water

1.87

Transport, Warehousing, Posts &

Telecommunication

2.10

Information and Technology

1.51

Miscellaneous Services Sector

5.10

Source: Foreign Investment Department, Ministry of

Commerce, Peoples Republic of China.

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Indias Investment closing in on Chinas (% of GDP).

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Centralization in India: Administrative Expenditure.

Central Govt.
expenditure

State Govt.
expenditur
e

Local
Authorities

(in Rs. Crores)

Central Govt. share in

Total Administrative
Expenditure
(%)

1960

365

525

141

35.00

1965

990

881

339

44.80

1970

1514

1540

630

41.10

1975

3072

2935

993

43.89

1980

4589

6029

1702

37.25

1985

11112

13075

3047

40.80

1990

22815

28653

6410

39.42

1995

44850

55746

12746

39.57

2000

99965

27250

40.41

2004

101045

120190
39
141334

32535

38.10

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Decentralization in China
Year

Central Govt.
Expn.

Local Govt.
Expn.

(100 million yuan)

Share of Cental
Govt. Expenditure
in total expenditure
(%)

1953

162.05

57.16

73.9

1958

177.22

223.14

44.3

1963

192.31

139.74

57.9

1968

219.49

138.35

61.3

1973

449.33

359.45

55.6

1978

532.10

589.90

47.4

1983

759.60

649.90

53.9

1989

888.77

1935.01

31.5

1993

1312.06

3330.24

28.3

1998

3125.60

7672.58

28.9

2003

7420.10

17229.85

30.1

2004

7894.08

20592.81

27.7

Source: Chinese Statistical Yearbook 2005

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Central Govt. salaries % GDP

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47

Industrialize to create jobs.

Educate and vocationalize youth for

Reform &
Perform
or Perish.

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jobs in industrial sector. Reduce

undersupply.
Invest in irrigation to reduce ecological
damage and increase farm productivity.
Consolidate holdings.
Build infrastructure. Eliminate Roads.
Ports and Railway bottlenecks.
Speed reforms to make power sector
profitable and investment worthy, labor
productive and India investment
friendly.
Address regional inequality issues.
Cut down subsidies.
Reform government and decentralize.
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The Buland Darwaza or Gate to Greatness at Fatehpur Sikri.

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International Trade as a % of GDP.

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