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<span style="font-weight: 400;"><p>Danish Siddiqui/Reuters<br /><br /><br /><br /><br /></p><ul class="summary-list"><li><strong><a href="https://www.businessinsider.com/category/india">India</a> has one of the largest economies in the world, and it's growing quickly.</strong></li><li><strong>But corruption and violence have cost the nation more than $1 trillion.</strong></li><li><strong>Read on for nine incredible facts about India's economy.</strong></li></ul><span style="font-weight: 400;"><a href="https://www.businessinsider.com/category/india">India</a> is a thriving nation with a population </span><a href="https://www.worldometers.info/world-population/india-population/"><span style="font-weight: 400;">estimated at around 1.37 billion people</span></a><span style="font-weight: 400;">, so it's little wonder that its economy is one of the largest on the planet. </span><br /><br /><span style="font-weight: 400;">Currently, India has the seventh largest economy based on GDP, but it is poised to move up the list if current expansion trends there continue.</span><br /><br /><span style="font-weight: 400;">This rapid expansion remains hampered by</span><a href="https://www.forbes.com/sites/ronakdesai/2018/03/07/india-continues-to-be-one-of-the-most-corrupt-countries-in-the-world/#512bfba379c6"><span style="font-weight: 400;"> corruption at all levels of government</span></a><span style="font-weight: 400;"> and by </span><a href="https://www.businessinsider.com/violence-cost-indias-economy-9-of-its-gdp-last-year-2018-6"><span style="font-weight: 400;">endemic violence that plagues many of India's</span></a><span style="font-weight: 400;"> 29 states. In fact, were it not for these twin issues, India would likely already enjoy a more robust economy - economists estimate India lost out on more than $1 trillion <a href="https://www.businessinsider.com/violence-cost-indias-economy-9-of-its-gdp-last-year-2018-6">because of violence</a> in 2017 alone.</span><br /><br /><span style="font-weight: 400;">Troubles aside, India remains a massive global exporter, an agricultural powerhouse, </span><span style="font-weight: 400;">and home to all </span><a href="https://www.businessinsider.com/all-of-the-10-fastest-growing-cities-in-the-world-are-in-india-2019-1"><span style="font-weight: 400;">10 of the fastest growing cities in the world</span></a><span style="font-weight: 400;">.</span><br /><br /><span style="font-weight: 400;">Read on for nine surprising facts about India's economy.</span><br /><br /></span>

9 incredible facts about India's economy

<p><div class="image-container float_right"><div class="image"><p class="source on-image">REUTERS/Babu</p></div></div><keyword id="3658" type="COUNTRY" weightage="60" keywordseo="India">India</keyword> is in desperate need of reforms.</p>
<p>With <a href="http://www.businessinsider.com/india-economic-slowdown-2013-5">economic growth at a ten-year low</a>, the rupee down over 12% year-to-date against the dollar, capital outflows, and <a href="http://www.businessinsider.com/indias-great-debt-transfer-2013-8">collapsing corporate profits</a>, it's no surprise that biggest story in India over the next year are the May 2014 elections.</p>
<p>Unfortunately, the government isn't expected to pass any major reforms between now and May 2014, and risk voter wrath.</p>
<p>What's worse, it's looking less likely that the incoming government will have the clear majority needed to pass any drastic, growth-stimulating reforms.</p>
<p>The latest opinion polls show the Congress party (which is largely expected to push populist measures) and the Bharatiya Janata Party (BJP - which is fiscally conservative and focused on a development agend) losing ground to a "third-front coalition."</p>
<p>The third-front refers to  <a href="http://www.reuters.com/article/2013/08/16/us-india-politics-parties-idUSBRE97F0HN20130816">regional parties, that are now expected to win nearly 50% of seats in parliament</a>. India holds general elections every five years, so, if elected, this third-front could stay in power till 2019. The president can however dissolve the lower house of parliament in extreme circumstances and call for general elections before the five-years are up. </p>
<p>The rise of the third front is bad news because the smaller parties have their own agendas and are likely to push for reforms centered on certain regions or communities, and are "unlikely to have strong national policies," argues CLSA analyst Mahesh Nandurkar. </p>
<p>"We see the chances of a weak leadership largely made up of regional parties - each with their own agenda and incapable of pursuing the bold reforms needed to kick-start India's economy - as the most probable scenario," writes Nandurkar. "This would usher in a period of prolonged weak and patchy policy making."</p>
<p>And the make-up of the government is likely to moves markets. From Nandurkar:</p>
<p style="padding-left: 30px;">"Market reaction to electoral results can be strong and immediate. Following 2009 election results, the market moved rallied 17% over two days as the ruling Congress won a stronger-than-expected mandate. After the 2004 result, the market dropped 17% in two days as the right wing BJP lost unexpectedly and a Congress coalition, supported by left-wing parties, came to power. In both cases, Congress won the elections."</p>
<p>Nandurkar expects a third-front coalition to claim 200 - 250 seats. He expects both the BJP and Congress to "woo" the regional parties and form alliances.</p>
<p>Of course political alliances are prone to change and the results of the upcoming state elections in November and December will also weigh on the 2104 elections. Moreover, there are 70 million new voters, or 10% of the electorate, that will take part in the 2014 elections and this could also impact the outcome. </p>
<p>Earlier this year, the Financial Times reported that in a <a href="http://www.ft.com/intl/cms/s/0/de41f46c-157f-11e3-b519-00144feabdc0.html?siteedition=intl#axzz2dtk8mwte">"confidential note" the IMF</a> was forced to make "a humbling series of U-turns over its global economic assessment."At a time when growth in developed markets is just beginning to return, <keyword id="6359891" type="COMPANY" weightage="60" keywordseo="emerging-markets">emerging markets</keyword> have failed be the engine of growth that the world had come to expect.</p>
<p>This is obviously key for foreign investors and businesses looking to make a footprint in India.</p>

Why India's Economy Could Be In Trouble For 5 More Years

<p><div class="KonaFilter image-container display-table"><div><div class="image on-image"><p class="source"><span>REUTERS/Adnan Abidi</span></p><p class="caption">Despite the fact that India has moved up one place on the Global Peace Index since last year, violence is still costing its economy hefty sums.</p></div><p></p></div></div></p><ul><li><strong>According to India's Union Minister of State for Home, 822 incidents of communal violence took place last year.</strong></li><li><strong>A report by the Institute for Economics and Peace shows violence cost India <a href="http://visionofhumanity.org/app/uploads/2018/06/Global-Peace-Index-2018-2.pdf" target="_blank" rel="nofollow noopener">$1.2 trillion</a> in 2017.</strong></li><li><strong>This equates to roughly $600 per person in India. </strong></li></ul><p><br />Getting 1.3 billion people to live in harmony, not only with each other, but with the rest of the world is no mean feat. <br /><br />India is no stranger to conflict - internal or external. Last summer, the country experienced a significant military standoff with its neighbour China for three months, over the latter's construction of a road in Doklam, an area that is a disputed territory of Bhutan. <br /><br />Domestically, the tenuous political situation in the state of Kashmir showed no signs of letting up last year, while protests, riots and communal violence in other parts of the country also continued. In fact, <a href="https://www.firstpost.com/india/india-witnessed-822-communal-incidents-in-2017-says-centre-111-killed-2384-injured-in-violence-4338217.html" target="_blank" rel="nofollow noopener">around 822 incidents</a> of communal violence reportedly took place in India last year, according to Hansraj Ahir, the Union Minister of State for Home.</p><h2><strong>Violence has come at a hefty price</strong> for India's economy</h2><p>This violence represents a significant cost to India's economic growth. According to international think tank, the Institute for Economics and Peace, violence cost the country <a href="http://visionofhumanity.org/app/uploads/2018/06/Global-Peace-Index-2018-2.pdf" target="_blank" rel="nofollow noopener">nearly $1.2 trillion</a> (₹80.1 trillion) in constant exchange rates, or 9% of its GDP in 2017. This equates to roughly $600 per person in India.</p><p>According to <a href="http://visionofhumanity.org/app/uploads/2017/04/The-Economic-Cost-of-Violence-Containment.pdf">a report</a> on the economic cost of violence containment, the yearly cost of violence containment is calculated by a variety of 13 different categories, including the cost of funding UN peacekeeping missions, the level of expenditure on the military and the cost of terrorism.</p><p>India did, however, move up one place to 136 on the Global Peace Index, a ranking of 163 countries owing to lower military purchases and a slight improvement in violent crime statistics. At the bottom of the list was war-torn Syria, which lost a staggering of 68% of its GDP, or $42 billion, last year due to violence. Iceland took the top spot in the index, losing only $830 million due to violence. <br /><br />The Middle East and North Africa (MENA) region continued to be the world's least peaceful geographic region, hosting 4 of the world's 10 most violent countries. South Asia proved to be the world's second least peaceful region, amid ongoing conflicts in Pakistan and Afghanistan - which lost 13% and 63% of their GDP, respectively, in 2017. <br /><br />The overall cost of violence in the world has risen 16% since 2012, when Syria's civil war started, reaching $14.76 trillion last year. This is equivalent to 12.4% of the world's GDP.</p>    <div class="margin-top">        <h3>NOW WATCH: <a href="http://www.businessinsider.com/economist-weighted-voting-could-help-save-us-democracy-2018-5">This top economist has a radical plan to change the way Americans vote</a></h3>        <div>                    </div>    </div>

Violence cost India's economy 9% of its GDP last year

<p>Earlier today, we highlighted both the <a href="http://www.businessinsider.com/the-state-of-the-indian-economy-in-one-big-slide-2013-9">positive and negative macro indicators</a> in the Indian economy. </p>
<p>But with economic growth at a 10-year low, it's worth taking a closer look what has gone wrong.</p>
<p>Below are five charts from Morgan Stanley.</p>
<p>First, inflation has started to tick up again. Food inflation is back at a six-year high, and onion prices have soared over 200% year-to-date.</p>
<p><div class="image-container click-to-enlarge"><div class="image"><a title_source="" title_caption="" class="zoomin" href="http://static2.businessinsider.com/image/52430b4d69bedd134a6cd2ce-960/screen shot 2013-09-25 at 12.11.47 pm.jpg"><span class="click-to-enlarge-icon" title="Click to enlarge"></span></a><p class="source">Morgan Stanley</p></div></div></p>
<p>Projects under implementation also fell. <keyword id="3658" type="COUNTRY" weightage="60" keywordseo="India">India</keyword> recently created the Cabinet Committee of Infrastructure (CCI) to <a href="http://timesofindia.indiatimes.com/business/india-business/More-steps-needed-to-avert-project-delay/articleshow/19875876.cms">avoid project delays</a> which frequently arise over land disputes and because of environmental concerns:</p>
<p><div class="image-container click-to-enlarge"><div class="image"><a title_source="" title_caption="" class="zoomin" href="http://static6.businessinsider.com/image/52430bd8ecad042e1b7d58c2-960/screen shot 2013-09-25 at 12.13.53 pm.jpg"><span class="click-to-enlarge-icon" title="Click to enlarge"></span></a><p class="source">Morgan Stanley</p></div></div> The current account deficit is narrowing, but continues to pose a threat to the rupee and economic growth. <a href="http://www.businessinsider.com/india-raises-gold-import-taxes-2013-6">Gold imports</a>, which are part of the reason India has a high current account deficit, declined in July and August. But the weakness in the rupee and oil price movements will play a crucial role in narrowing the current account deficit:</p>
<p><div class="image-container click-to-enlarge"><div class="image"><a title_source="" title_caption="" class="zoomin" href="http://static5.businessinsider.com/image/52430f2a6bb3f77b1f6cd2e2-960/screen shot 2013-09-25 at 12.25.08 pm.jpg"><span class="click-to-enlarge-icon" title="Click to enlarge"></span></a><p class="source">Morgan Stanley</p></div></div></p>
<p>The rupee is still down nearly 13% year-to-date, against the U.S. dollar. The <a href="http://www.businessinsider.com/morgan-stanley-fragile-5-emerging-markets-2013-9#the-indian-rupee-3">central bank intervened</a> to support the currency:</p>
<p><div class="image-container click-to-enlarge"><div class="image"><a title_source="" title_caption="" class="zoomin" href="http://static6.businessinsider.com/image/524314c1ecad040f2f7d58b9-960/inrusd-1.jpg"><span class="click-to-enlarge-icon" title="Click to enlarge"></span></a><p class="source">Google Finance</p></div></div></p>
<p>Short-term interest rates are expected to stay elevated for a few more months and this is likely to strain GDP growth, which climbed just 4.4% in the first quarter:</p>
<p><div class="image-container click-to-enlarge"><div class="image"><a title_source="" title_caption="" class="zoomin" href="http://static6.businessinsider.com/image/524312f1eab8ea94446cd2ce-960/screen shot 2013-09-25 at 12.44.26 pm.jpg"><span class="click-to-enlarge-icon" title="Click to enlarge"></span></a><p class="source">Morgan Stanley</p></div></div></p>
<p>Of course there have been some improvements in the Indian economy. For instance, industrial production ticked up, corporate revenue growth has improved modestly, and auto sales are picking up.</p>
<p>But Morgan Stanley analysts Chetan Ahya and Upasna Chachra expect "slow growth and higher rates to stay for a while longer."</p>

In 5 Charts, Here's Why India's Economy Is In Trouble

India is poised to remain the fastest-growing major economy in 2024-25, Chief Economic Adviser V Anantha Nageswaran said in a press conference after the tabling of the <keyword id="20613906" type="General" weightage="20" keywordseo="economic-survey" source="keywords">Economic Survey</keyword> in the Parliament on Monday.<br /><br />The Economic Survey tabled today projected India to grow at 6.5-7.0 per cent in 2024-25.<br /><br />Global institutions, including <keyword id="19896779" type="General" weightage="20" keywordseo="IMF" source="keywords" meta.keywordsubtype="org" meta.entityname="IMF" meta.hostid="261" meta.entityid="IMF">IMF</keyword>, OECD, World Bank, S&amp;P, ADB, and Fitch, have projected India to grow in a range of 6.6-7.2 per cent.<br /><br />The International Monetary Fund (IMF), in its latest outlook, has raised India's growth projections for 2024 from 6.8 per cent earlier to 7 per cent, with the country maintaining the fastest-growing status in emerging markets and developing economies.<br /><br />According to official data of the Indian government, the country's GDP grew at an impressive 8.2 per cent during the financial year 2023-24. India's economy grew 7.2 per cent in 2022-23 and 8.7 per cent in 2021-22 respectively.<br /><br />Further, the CEA in his press conference projected that India's <keyword id="20089672" type="General" weightage="20" keywordseo="per-capita-income" source="keywords">per capita income</keyword> is expected to increase from around Rs 2 lakh in 2022-23 to Rs 14.9 lakh in 2046-47.<br /><br />Further, CEA said <keyword id="20751315" type="General" weightage="20" keywordseo="household-savings" source="keywords">household savings</keyword> of Indians in physical assets have been increasing over the past three financial years through 2023-24.<br /><br />The CEA, addressing the press conference, said household savings in physical assets rose from 8 per cent in 2020-21 to 12.9 per cent in 2022-23.<br /><br />"Households are not in distress, they are investing in <keyword id="20792385" type="General" weightage="20" keywordseo="financial-assets" source="keywords">financial assets</keyword> that have done very well. Financial assets of households are not marked to market so households are doing quite well in the aggregate," he said.<br /><br />India needs both banks and capital markets to provide the required finances sourced from a sustained high level of household savings, according to the Survey.<br /><br /><keyword id="20385790" type="General" weightage="20" keywordseo="Union-Finance-Minister" source="keywords">Union Finance Minister</keyword> Nirmala Sitharaman on Monday tabled the economic survey in Parliament, a day ahead of the full Budget presentation for 2024-25.<br /><br />The Economic Survey document, prepared by the Economic Division of the Department of Economic Affairs in the Ministry of Finance and formulated under the supervision of the chief economic adviser, gives insights into the state of the economy and various indicators of 2023-24 (April-March) and some outlook for the current year.<br /><br />The Economy Survey document also gave some idea about the tone and texture of the actual Budget for 2024-25, to be presented on Tuesday. (ANI)<br /><br />

India to remain fastest growing major economy in 2024-25, says CEA Nageswaran

<ul class="summary-list"><li>India's economy is on track to surpass the US and become the world's second-largest by 2075, Goldman Sachs forecasts. </li><li>Key drivers of the South Asian nation's growth include its technological advances and a large population. </li></ul><p>India's economy is on track to surpass the US by 2075 to become the world's second-largest after China, <a href="https://www.goldmansachs.com/intelligence/pages/how-india-could-rise-to-the-worlds-second-biggest-economy.html" target="_blank" rel="noopener">according to Goldman Sachs</a>.</p><p>The Wall Street bank projects the South Asian nation's GDP surging to $52.5 trillion by then, compared with forecasts of $57 trillion and $51.5 trillion for China and the US, respectively. India's growth will be powered mainly by its large labor force, advances in technology and rising capital investment, the bank said in a note.</p><p>At present, India is ranked the fifth-biggest economy in the world with a GDP of $3.74 billion and a per capita income of $2,600, <a href="https://www.imf.org/external/datamapper/NGDPD@WEO/IND/GBR" target="_blank" rel="noopener">according to the International Monetary Fund</a>. </p><p>High-profile market experts like <a href="https://markets.businessinsider.com/news/stocks/ray-dalio-india-billionaire-investor-narendra-modi-elon-musk-tesla-2023-6" target="_blank" rel="noopener">Ray Dalio</a> and <a href="https://www.businessinsider.com/mark-mobius-bullish-india-korea-china-legendary-emerging-markets-investor-2023-6">Mark Mobius</a> have hailed the Asian nation as the next biggest investing opportunity. Even major companies including Apple, Tesla and SpaceX have leaned into the emerging economy as a hub for its supply chains instead of China.</p><h2>'Innovation and technology'</h2><p>"India has made more progress in innovation and technology than some may realize," Santanu Sengupta, Goldman Sachs's chief India economist, said. "Innovation and increasing worker productivity are going to be important for the world's fifth-biggest economy. In technical terms, that means greater output for each unit of labor and capital in India's economy," he added.</p><p>But India also <a href="https://www.businessinsider.com/india-business-market-entry-barriers-tariffs-supply-chain-china-2023-6?r=US&amp;IR=T" target="_blank" rel="noopener">faces hurdles</a> in its journey toward economic superpower status. These include hefty import taxes, bureaucracy and red tape, and the dominance of domestic business tycoons – which make it harder for foreign companies to snap up any market share in key industries. </p><h2>Capital investments </h2><p>According to Goldman's Sengupta, capital investment, which refers to money invested in a business for its long-term growth, is going to be a key engineer of India's growth moving forward. </p><p>"Driven by favorable demographics, India's savings rate is likely to increase with falling dependency ratios, rising incomes, and deeper financial sector development, which is likely to make the pool of capital available to drive further investment," he said. </p><p>India's Prime Minister Narendra Modi has been a cheerleader for capital expenditure, recently urging the nation's private sector to boost investment and take advantage of the nation's 2023-24 budget, <a href="https://www.thehindu.com/news/national/pm-modi-asks-india-inc-to-step-up-investment/article66590176.ece" target="_blank" rel="noopener">per the Hindu newspaper</a>. </p><h2>Ballooning population </h2><p>Lastly, India has the opportunity to turbocharge its GDP by integrating its growing population into the labor force. The South Asian nation recently <a href="https://www.un.org/development/desa/dpad/publication/un-desa-policy-brief-no-153-india-overtakes-china-as-the-worlds-most-populous-country/" target="_blank" rel="noopener">overtook China</a> to become the world's most populous, with 1.4 billion people. </p><p>"India's large population is clearly an opportunity, however the challenge is productively using the labor force, by increasing the labor force participation rate. That will mean creating the opportunities for this labor force to get absorbed and simultaneously training and upskilling the labor force," Sengupta said.</p>

You Searched For "India economy" and got 7 results

9 incredible facts about India's economy

Steven John

Why India's Economy Could Be In Trouble For 5 More Years

Mamta Badkar

9 incredible facts about India's economy

Violence cost India's economy 9% of its GDP last year

Dilsher Dhillon

In 5 Charts, Here's Why India's Economy Is In Trouble

Mamta Badkar

India to remain fastest growing major economy in 2024-25, says CEA Nageswaran

ANI

India's economy will surpass the US in size by 2075, thanks to its tech scene and growing population, Goldman Sachs says

Zahra Tayeb

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