gdp indian approach

“Government's view of the economy could be summed up in a

few short phrases:

If it moves, tax it. If it keeps moving, regulate it.

And if it stops moving, subsidize it”

RONALD REAGANFORMER U.S. PRESIDENT

GDP -DEFINITION

Measurement of gdp

LIMITATIONS OF GDP…

• assumes that every monetary transaction adds to well-being

• ignores everything that happens outside the realm of monetized exchange

• treats crime, divorce and natural disasters as economic gain

• ignores the non-market economy of household and community

• treats the depletion of natural capital as income• takes no account of income distribution• ignores the drawbacks of living on foreign assets

Moving up AGAINST all odds…

• 16 years• 6 governments• 5 prime ministers• ONE DIRECTION• 9% GDP growth

• India ranks second worldwide in farm output, employ 60% of the total workforce: PRIMARY SECTOR

• India is fourteenth in the world in factory output, employ 17% of the total workforce: SECONDARY SECTOR

• India is fifteenth in services output, employ 23% of the total workforce: TERTIARY SECTOR

205 223319 347

103 91

116117

104 109

155168

0

100

200

300

400

500

600

700

1999-00 2002-03 2005-06 2006-07

USD

Billio

n

Services Agriculture Industry

The sound performance of each industry segment is leading to The overall robust performance of the Indian economy

India's GDP: 2002-07

424484 534

590 631

0

100

200

300

400

500

600

700

2002-03 2003-04 2004-05 2005-06 2006-07

USD

Billio

n

GDP at Constant Prices

4%

8.5% 7.5%

8.4%9.4%

India’s GDP witnessed high growth and was the second fastest growing GDP after China

SHARE IN INCREMENTAL WORLD GDP

GDP – USD 590 billion

GDP growth rate – 9 %

Services contribution – 54 %

FDI limit not 100 percent in major industry sectors such as Telecom, Semiconductors, Automobiles, etc.

Balance of Trade – USD (-)46.2 billion

Investment goal – USD 250 billion


GDP growth rate – 9 %


FDI limit not 100 percent in major industry sectors such as Telecom, Semiconductors, Automobiles, etc.

Balance of Trade – USD (-)46.2 billion


20062006 GDP – USD 750 billion

GDP growth rate – 9.5%


FDI limit is expected to be close to 100 percent in major industry sectors such as Telecom, Semiconductors, Automobiles, etc.

Balance of Trade – Should increase with surging exports as compared with imports



GDP growth rate – 9.5%


FDI limit is expected to be close to 100 percent in major industry sectors such as Telecom, Semiconductors, Automobiles, etc.

Balance of Trade – Should increase with surging exports as compared with imports


20082008


GDP growth rate – 9%

Services contribution – 60-65 %

FDI limit is expected to be 100 percent in major industry sectors such as Telecom, Semiconductors, Automobiles, etc.

Balance of Trade – Should be positive with increased level of exports as compared with imports



GDP growth rate – 9%

Services contribution – 60-65 %

FDI limit is expected to be 100 percent in major industry sectors such as Telecom, Semiconductors, Automobiles, etc.

Balance of Trade – Should be positive with increased level of exports as compared with imports


20102010

GROWTH EXPECTED IN INDIA

To sustain the GDP growth of more than 8 percent, India requires an investment of USD 1.5 trillion in the next five years

USD 12.1 billion Tata Steel buys Corus Plc

USD 6 billion Hindalco acquired Novelis Inc.

USD 1.58 billion Essar Steel acquired Algoma Steel

USD 730 million Videocon Industries acquired Daewoo

Electronics Corporation Limited

USD 1.6 billion Suzlon Energy Ltd. acquires REpower

USD 11 billion Vodafone buys Hutch

USD 0.98 billion Aditya Birla Group increased its stake in Idea Cellular by acquiring 48.14-percent stake

USD 1 billionPlans investment in private equity, real estate, and private wealth management

USD 1.7 billionPlans to spend on its development operations in India over the next four years

USD 0.905 billion

Renault, Nissan and Mahindra & Mahindra has initiated a Greenfield automobile plant project in Chennai.

Mylan Laboratories acquired a majority stake in Matrix Laboratories USD 0.74 billion

CAN INDIA MAINTAIN ITS

HUGE GROWTH RATE???

gdp indian approach

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