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 economic rate of growth has slowed down somewhat in line with global trends but has held a firm growth rate of approx. 7 per cent in 2016-17 and could dip to 6.5 per cent in 2017-18 due to the demonetization and GST reforms. India's Current Account Deficit narrowed down to 0.3 per cent of GDP in the first half of 2016/17. Exports amounted to USD 275 billion in 2016-17 while imports reached USD 381 bn. India is ranked as the 19th largest exporting and 12th largest importing nation. USA, UAE, China (incl. Hong Kong), Singapore, UK, Germany, Vietnam, Bangladesh, Belgium and Nepal ranked as India's ten largest export markets in the first seven months of 2017-18. Countries exporting the most to India include China (incl. Hong Kong), USA, UAE, Saudi Arabia, Switzerland, South Korea, Indonesia, Iraq, Australia and Germany during the aforementioned period.
India's tax revenue to GDP ratio remains very low at around 10 % in comparison to rates of upto 30 % and over in many OECD countries. The Government of India's total tax (direct and indirect) collections are estimated to amount to approx. ₹5.5 trillion in the year ended March 2008. A large section of the employed workforce is exempt from any Income tax as the taxfree annual income limit has been raised to ₹150,000 (₹180,000 for women and ₹225,000 for senior citizens). 47 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|
|Electricity, Gas, Water Supply & Other Utility||2.5||3.42||54|
|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|
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.
India's merchandise exports was valued at USD 275 bn for the year 2016-17. 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. Commercial services valued at over USD 160 bn were exported from India during the same year while service imports amounted to USD 95 bn. 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.
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 Sales 2015-16 (₹bn)||Net Profit|
(₹ billion) ²
|State Bank of India||2729||122|
|Larsen & Toubro||1033||51||125|
|Coal India Ltd.||852||143|
|Mahindra & Mahindra||791||32|
² As on 28/01/05
Source: Fortune India 500
India's steel production capacity had increased to approx. 118 MMT by April 2016. India is currently the third largest (PRC and Japan being larger) steel producer in the world. India is the third largest iron ore exporter after Australia and Brazil. China is the major export market for Indian iron ore. Large Indian steel companies include SAIL, Tata Steel, JSW Steel, Essar Steel, Rashtriya Ispat Nigam and Ispat Industries. JSW overtook SAIL in 2014-15 as the largest steel producing company in India.
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.
India's proved coal reserves (incl. anthracite, bituminous, sub-bituminous and lignite) were estimated to be approx. 300 billion tonnes in 2014. Thermal power utilities are the largest consumers of coal (approx. 2/3 of production) followed by the steel and cement industries. Coal production has increased from 30 million tonnes in 1947 to 610 million (incl. lignite) tonnes during 2013-14 making India the third largest producer and consumer behind China and the USA.
India has approx. ½ billion tonnes of recoverable reserves of copper.
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.
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 employment to 15 million people. The recent withdrawal of the MFA quota system should strenghten India's position in the world textile marketplace. Some studies indicate India's share in textile exports will increase to 15 per cent from the present 3 per cent of global textile trade market. India exported USD 17.1 bn worth of textiles and clothing in 2005-06. 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. Many of these companies have downsized export operations and laid off hundreds of thousands of employees.
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.
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.
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.
India's automotive sector contributes has grown into a multi-trillion Rupee industry having produced almost 24 million units during 2015-16. Read more on the auto industry at knowIndia.net's auto page >>
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.
India's paper industry produced an estimated 4.1 million tons of paper and paper board products in 2006-07.
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.