Economy
The Indian economy is the third¹ largest in the world after the United States and China and also among the fastest growing large economies, accounting for approx. 5.7 per cent of the world's GDP. India's economy grew by roughly 7 per cent in 2022-23 compared to an estimated 8.7 per cent in the previous year. India's fiscal deficit stood at an estimated 6.4 per cent of GDP in 2022-23. India's merchandise exports increased to USD 451 billion mark in 2022-23 while imports soared to USD 714 billion during the same year.
India's tax revenue to GDP ratio remains low at around 11 % (2017) in comparison to a world average of approx. 15 % (2018). The Government of India's direct tax collections amounted to approx. ₹10.27 trillion in 2019-20. India had over 82 million tax payers (individual and corporate) in 2019-20. A significant section of the employed workforce is exempt from any income tax as the tax exemption limit (based on annual income) has been raised to ₹250 000 (₹300 000 for senior citizens aged between 60 and 80 years and ₹500 000 for those aged at least 80 years) in 2020-21. 327 million Indian residents have a PAN (Permanent Account Number).
¹ based on Purchasing Power Parity adjusted IMF figures| Sector | Share (%) | ₹ Trillion | USD Billion |
|---|---|---|---|
| Agriculture, Forestry and Fishing | 17.4 | 23.72 | 375 |
| Mining & Quarrying | 2.2 | 30.19 | 48 |
| Manufacturing | 16.5 | 22.57 | 357 |
| Electricity, Gas, Water Supply & Other Utility | 2.5 | 3.42 | 54 |
| Construction | 7.6 | 10.41 | 165 |
| Trade, Hotels, Transport, Communication and Services Related to Broadcasting | 18.4 | 25.20 | 398 |
| Financial, Real Estate and Professional Services | 21.1 | 28.89 | 456 |
| Public Administration, Defence and Other Services | 14.2 | 19.46 | 307 |
| Total | 136.70 | 2160 |
Manufacturing
The number of factories operating in India was 230 000 in 2014-15. These factories employed approx. 13.8 m persons and had a total output value of approx. ₹ 69 trillion. The small-scale industries sector included approx. 51 m units in 2014-15 and employed roughly 117 m persons. Value of production was around ₹ 18 trillion in 2012-13.
Economic Indicators
- GDP (Gross Domestic Product)
- - On the basis of Purchasing Power Parity (PPP) - 2011 IMF: USD 4.5 trillion
- - GDP at factor cost (2008-09): ₹52.1 trillion
- WPI (Wholesale Price Index) Annual Rate - Jun 2020: 3.1 %
CPI (Consumer Price Index) Dec 2022 (YoY inflation): 5.7 % - GDP Growth (2022-23) - ca 7 %
- GDP By Sector (2010): Services 55.2 %, industry 26.3 % and agriculture 18.5 %
- GDP at Current Prices (2008-09): ₹ 54.26 trillion
- Domestic Savings Rate (of GDP): 28.1 % (₹ 7.8 trillion)
Union Budget (2021-22) Total Expenditure (Budgeted): ₹ 34.83 trillion - Union Budget (2019-20) Total Expenditure (Actuals): ₹ 26.86 trillion
- Merchandise Exports (2022/23): USD 451 bn
- Merchandise Imports (2022/23): USD 714 bn
- Total Remittances (2022): USD 100 bn
Foreign Trade
India's merchandise exports and imports were valued at USD 451 billion and USD 714 billion respectively for the year ended Mar '23. In 2015 India's share of global merchandise exports was approx. 1.6 per cent and 3.3 per cent of global commercial services exports. India's five largest trading partners were the United States (USD 129 bn), China (USD 114 bn), UAE (USD 85 bn), Saudi Arabia (USD 53 bn) and Russia (USD 43 bn) in 2022-23. Commercial services valued at USD 255 bn were exported from India in 2021-22. Services exports include IT related services, business services, transport and travel services.
More data on foreign trade is available at the Directorate General of Commercial Intelligence and Statistics website.
India's 20 Largest Companies By Revenue (2018)
Seven Indian companies, namely Indian Oil, Reliance Industries Ltd., BPCL, HPCL, ONGC, Tata Motors and Rajesh Exports are listed on the Fortune Global 500 list for the year 2016. India's largest company, Indian Oil, with a turnover of USD 54.7 bn, placing it at the 161st position on the list.
| Company | Revenue (₹ bn) | Profit (₹ billion) |
Market Capitalisation (₹ billion) ² |
|---|---|---|---|
| Indian Oil | 4 243 | 222 | 1 504 |
| Reliance Industries | 4 103 | 361 | 8 352 |
| ONGC | 3 331 | 221 | 2 130 |
| State Bank of India | 3 065 | -46 | 3 068 |
| Tata Motors | 3 012 | 90 | 474 |
| Bharat Petroleum | 2 386 | 90 | 8 384 |
| Hindustan Petroleum | 2 217 | 72 | 467 |
| Rajesh Exports | 1 878 | 13 | |
| Tata Steel | 1 472 | 134 | 604 |
| Coal India Ltd. | 1 329 | 70 | 1 572 |
| TCS | 1 267 | 258 | 8 460 |
| Larsen & Toubro | 1 227 | 74 | 2 142 |
| Hindalco | 1 204 | 61 | 445 |
| ICICI Bank | 1 190 | 77 | 2 695 |
| Vedanta | 1 022 | 103 | 630 |
| HDFC Bank | 1 013 | 185 | 3 766 |
| Mahindra & Mahindra | 964 | 75 | 792 |
| NTPC | 901 | 105 | 1 314 |
| Bharti Airtel | 867 | 11 | 1 813 |
| Maruti Suzuki India | 820 | 79 | 2 034 |
² As on 14/06/19
Source: Fortune India 500
Selected Industries
Iron and Steel
India's steel production capacity had increased to approx. 118 MMT by April 2016. India was the second largest (PRC ranking as the largest producer) steel producer in the world and the ninth largest steel exporter in 2019. India accounted for over five per cent of world steel production in 2020. Major Indian steel companies include SAIL, Tata Steel, Jindal Steel and Power, JSW Steel, Essar Steel, Rashtriya Ispat Nigam and Ispat Industries (RINL).
- Crude steel production (2020): 99.6 million tonnes
- Ministry of Steel
- Indian Steel Alliance
- The Indian Stainless Steel Development Association
A view of the Vizag Steel Plant located just south of the port city of Visakhapatnam, Andhra Pradesh. The plant rolls out ca 4 million tons of saleable steel with an annual capacity of 6.3 MMT.
Coal
India's proved coal reserves (incl. anthracite, bituminous, sub-bituminous and lignite) were estimated to be approx. 315 billion tonnes in 2017. Thermal power utilities are the largest consumers of coal (approx. 2/3 of production) followed by the steel and cement industries. Coal India Ltd, the world's largest coal mining company, registered a revenue of ₹ 1.28 trillion in 2022-23 while coal production stood at 703 million tons. Coal production has increased from 30 million tonnes in 1947 to 893 million (incl. lignite) tonnes in 2022-23 making India the second largest producer and consumer behind China. Coal production has increased over the years is expected to amount to 900 m tons in 2022-23. Despite coal being a significant source and contributor of greenhouse emissions, demand in India is projected to grow to as much as 1 500 m tons by 2030.
- Coal (incl. lignite) production (2022-23): 893 million tonnes
- Coal and coke imports (2022-23): 218 million tonnes (est)
- Ministry of Coal
- Coal India Limited
- The Singareni Collieries Company Limited
- Neyveli Lignite Corp. Ltd.
Aluminium
- Aluminium production (2013-14): 1.7 million MT
- Ministry of Mines
- National Aluminium Company Limited (Nalco)
- Bharat Aluminium Company Limited (BALCO)
- Madras Aluminium Company Limited (MALCO)
- Hindalco
Copper and Zinc
India has approx. ½ billion tonnes of recoverable reserves of copper.
- Refined Copper Production: 512,000 tonnes
- International Copper Promotion Council (India) - ICPCI
- Sterlite Industries
- Hindustan Copper Ltd.
- Birla Copper
- Hindustan Zinc Ltd.
A view of the 80 000 tpa Hindustan Zinc Ltd. Debari zinc smelter located near Udaipur, Rajasthan.
Cement
India is the second largest cement producing nation in the world after China. Foreign players in the cement market include Lafarge, Italcementi, Holcim and Heidelberg Cement. The industry's turnover is around ₹ 300 billion providing direct employment to 150 000 persons. India is capable of producing cement to any standard requirements (BS, ASTM, DIN). Major cement producers include UltraTech Cement, JSW Group, ACC, Grasim Industries and Gujarat Ambuja.
- Cement production (2018): 298 million tonnes
- Cement installed capacity (2018): 509 million tonnes per annum
- Cement plants: ca 300
- Cement Manufacturers' Association
- Indian Cement Review
Textile
The Indian textile industry is one of the largest of its kind in the world and the largest yarn producer. The industry's total output is valued at approx. ₹1.6 trillion (exports account for roughly a third of total output) and provides direct employment to around 45 million people and a further 60 million jobs in allied sectors. India exported over USD 44 bn worth of textiles and clothing/handicrafts in 2021-22 accounting for approx. six per cent of overall global trade in textiles. The appreciation of the Indian rupee against the weakening US dollar has hit hard on many textile and apparel exporters facing fierce competition from other low-cost competing nations such as Bangladesh and China.
Main textile products exported in 2021-22 include:
- Apparel and clothing accessories, knitted or crocheted (USD 8.2 bn)
- Apparel and clothing accessories, not knitted or crocheted (USD 7.8 bn)
- Carpets and other textile floor coverings (USD 2.2 bn)
- Cotton (ca USD 10.8 bn)
- Man-made filaments (USD 2.4 bn)
- Man-made staple fibres (USD 2 bn)
- Other made up textile articles, worn clothing and textile articles, rags (USD 6.8 bn)
Chemical
The chemical industry includes the following sectors: Basic inorganic and organic, drugs and pharmaceuticals, pesticides and agrichemicals, petrochemicals, dyes and pigments, fine and speciality chemicals and fertilizers. New sunrise sectors include nutraceuticals and biotechnology.
Fertilizer
- Nitrogenous (N) and Phosphatic (P205) Fertilizer production (2006-07): 16.1 million tonnes
India's ₹330 billion fertilizer industry has a capacity to manufacture 17.4 million tonnes of N and P ranking India as the third largest N and P producer. Potassic fertilizers form the bulk of the two million tons of fertilizers India imported during 2003-04.
Pharmaceuticals
India's approx. ₹400 billion pharmaceuticals industry (fourth largest in the world in terms of volume) has recently drawn more attention due to its generic drug products penetration in many foreign markets (22 per cent world market share in 2001). Registered Indian pharma companies number over 10 000 both in the SME and large enterprise sectors. Bulk drugs are produced in large volumes and India is as an example the largest ibuprofen manufacturer. Pharmaceuticals exports amounted to over USD 13.2 billion in 2011--12, the US being the largest market. India now recognizes all patents obtained after 1995. This could have an adverse effect on the operations of some generic drug manufacturers whose business has solely rested on reverse engineering drugs. India's retail pharma sales amounted to ₹28.5 bn in Feb '09. Hospital and institute drug sales are estimated at ₹70 bn pa. The largest domestic companies are Cipla, Ranbaxy, GlaxoSmithKline and Piramal Healthcare.
Autos
India's automotive sector contributes has grown into a multi-trillion Rupee industry having produced 24.5 million units during 2018-19. Read more on the auto industry at knowIndia.net's auto page >>
Gems And Jewellery
India exported gems and jewellery worth USD 32 billion in 2015-16. Cut and polished diamonds took the lion's share of exported gem and gold products. India is by far the largest diamond cutting and polishing center in the world and the largest consumer of gold. The recent slump in global diamond demand has a resulted in massive layoffs in the diamond processing units based mainly in Surat.
Paper
India's paper industry produced an estimated 4.1 million tons of paper and paper board products in 2006-07. Total paper consumption amounted to approx. 18.6 m tons in 2018-19. India's paper, paperboard and newsprint exports and imports in 2018-19 amounted to approx. 1.5 m tons and 2.8 m tons respectively.
Information Technology & BPM
Other Related Links:
- Ministry of Commerce and Industry - Department of Commerce
- Ministry of Commerce and Industry - Office of the Economic Adviser (OEA) / Department for Promotion of Industry and Internal Trade
- Special Economic Zones (SEZ) in India
- Indian Council for Research on International Economic Relations
- National Council of Applied Economic Research
- Trade Portal of India
- FICCI - Federation of Indian Chambers of Commerce and Commerce
- CII - Confederation of Indian Industry
- Planning Commission
- Income Tax Department
- Union Budget & Economic Survey
- Ministry of Statistics and Programme Implementation
- Directorate General of Foreign Trade (DGFT)
- South Asian Association for Regional Cooperation (SAARC)
Books on Indian Economic Issues:
I have collected a small selection of books dealing with Indian economic issues. You may order the following books via Amazon.co.uk by clicking on the book images below.
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Facets of the Indian Economy by Rakesh Mohan
-
The Indian Economy: Problems and Prospects by Bimal Jalan
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India 2020: A Vision for the New Millennium by Dr. A.P.J Abdul Kalam (President of India)
- Click here for a paperback version: India 2020: A Vision of the New...