Indian Economy 2010 Overview

The economy of India is the twelfth largest economy in the world by nominal value and the fourth largest by purchasing power parity (PPP) [how much that money can buy in India compared to other countries.

As per the advance estimates of GDP for 2009-10, released by the Central Statistical Organization (CSO), the economy is expected to grow at 7.2 per cent in 2009-10.[Download PDF Version]

Generally the following are the (eight) sectors used for calculating the GDP in India by CSO.

The First three quarters of fiscal year 2009-10:

	Q1	Q2	Q3
1.       Agriculture, Forestry & Fishing	2.4	0.9	-2.8
2.       Mining & Quarrying	7.9	9.5	9.6
3.       Manufacturing	3.4	9.2	14.3
4.       Electricity, Gas & Water Supply	6.2	7.4	4.0
5.       Construction	7.1	6.5	8.7
6.       Trade,  Hotels , Transports & Comminication	8.1	8.5	10.0
7.       Financing,  Insurance,  Real  Estate  &  Business  Services	8.1	7.7	7.8
8.       Community, Social & Personal Services	6.8	12.7	-2.2
GDP at Factor Cost	6.1	7.9	6.0

Note: Q1(April-June), Q2(July-Sep), Q3(Oct-Dec), Q4(Jan-March)

Per Capita Growth:

The growth rates in per capita income and consumption, which are gross measures of welfare in general, have declined in the last two years. While the growth in per capita income, measured in terms of GDP at constant market prices, has declined from a high of 8.1 per cent in 2007-08 to 3.7 per cent in 2008-09 and then recovered to 5.3 per cent in 2009-10.

	Income			Consumption
	Rs	(%)		Rs	(%)
		Growth			Growth
2004-05	29,745		17,620
2005-06	32,012	7.6	18,909		7.3
2006-07	34,533	7.9	20,168		6.7
2007-08	37,328	8.1	21,841		8.3
2008-09	38,695	3.7	23,012		5.4
2009-10	40,745	5.3	23,626		2.7

The below figure shows the growth of different sectors in the years between 2005-06 to 2008-09. For the year 200-10 it is estimated by CSO.

Rate of Growth at factor cost at 2004-05 prices (percent):

		2005-06    2006-07    2007-08			2008-09   2009-10
	Agriculture, Forestry & Fishing	5.2	3.7	4.7	1.6	-0.2
	Mining & Quarrying	1.3	8.7	3.9	1.6	8.7
	Manufacturing	9.6	14.9	10.3	3.2	8.9
	Electricity, Gas & Water Supply	6.6	10.0	8.5	3.9	8.2
	Construction	12.4	10.6	10.0	5.9	6.5
	Trade,  Hotels  &  Restaurants	12.4	11.2	9.5	5.3	8.3*
	Transport,  Storage  &  Communication	11.5	12.6	13.0	11.6
	Financing,  Insurance,  Real  Estate  &  Business  Services	12.8	14.5	13.2	10.1	9.9
	Community, Social & Personal Services	7.6	2.6	6.7	13.9	8.2
	GDP at Factor Cost	9.5	9.7	9.2	6.7	7.2

Source: CSO

*  Transport  &  communication  included  for  2009-10  in  trade,  hotels  and  restaurants.

Inflation:

Inflation is a rise in the general level of prices of goods and services in an economy over a period of time.

The primary tool for controlling inflation is monetary policy. RBI raised Cash Reserve Ration (CRR) to curb inflation in the Third quarter Review of Monetary Policy for 2009-10.

The Wholesale Price Inflation (WPI) is at present calculated with 1993-94 as the base year. The new index, with 2004-05 as the base year, will have 250 new items and is expected to provide a more realistic picture of price rise and its impact on people. April(2010) data would be released on May with the new base year.

Inflation during the month of January 2010 – 8.56%.

Inflation during the month of December 2009 – 7.31%.

Inflation during the month of November 2009 – 4.78%.

India’s External Debt:

As per the standard practice, India's external debt statistics for the quarters ending March and June are released by the Reserve Bank of India and those for the quarters ending September and December by the Ministry of Finance. 

India’s external debt, as at end-September 2009, was placed at US$ 242.8 billion.

India’s external debt, as at end-June 2009, was placed at US $ 229 billion.

India’s external debt, as at end-March 2009, was placed at US $ 224 billion (22.0 per cent of GDP).