Transcript India a growing economy

India
A growing economy
India: rising GDP growth
% average annual GDP growth
1900 – 1950
1950 – 1980
1980 – 2002
2002 – 2006
1.0
3.5
6.0
8.0
• What do these figures tell you about the Indian economy?
Population growth
% average annual growth
1901 – 1950
1951 – 1980
1981 – 1990
1991 – 2000
2001 – 2010
1.0
2.2
2.1
1.8
1.5
• What do these figures tell you about population
growth in India?
Adult literacy rates
1950
1990
2000
2010 (projected)
%
17
52
65
80
• What do these figures tell you about changes to education
in India?
People categorised as middle class
% of population
Million People
1980
8
65
2000
22
220
2010 (projected)
32
368
•
What do these figures tell you about the service
sector economic growth in India?
Poverty statistics
Estimates of those in poverty
1980
2000
2010 (projected)
46%
26%
16%
• 1% of the people have been crossing poverty line each year for 20
years. Equals 200 million people.
• What do these figures tell you about anti-poverty strategies
in India?
Productivity is rising
30% to 40% of GDP growth is due to
rising productivity
India is now the 4th largest
economy
It will overtake Japan between 2012 and 2014
to become the 3rd largest world economy
DRIVERS OF GROWTH
India
Domestic
Services
Consumption
High tech, capital
intensive industry
East and S.E. Asia
Exports
Manufacturing
Investment
Low tech, labour
intensive industry
What is the implication of the Indian
model?
• Has India skipped the industrial
revolution?
• How does India take its people
from farms to cities?
Rise of globally competitive
Indian companies:
Reliance, Jet Airways, Infosys, Wipro,
Ranbaxy, Bharat Forge, Tata Motors,
TCS, Bharati, ICICI and HDFC Banks
Demographic trend points to sharp increases in input factors
Demographic Split
54%
0-25
yrs
46%
25+
yrs
1,600
1,400
1,200
1,000
800
600
400
200
0
1.5 bn
1.1 bn
800
420
2005
Labor Force will double in the next 20 years
2025
Labor
Force
Demographic trend points to sharp increases in input factors
Age Dependency
80%
72%
62%
60%
<50 %
45%
2025
China 2002
40%
20%
0%
1980's
2002
Savings Rate
50%
42%
40%
35+%
30%
20%
24%
17%
10%
0%
1980's
2002
2025
China 2002
Higher savings and investment rate will translate into higher GDP growth
“By 2010 India will have world’s
largest number of English speakers”
“When 300 million Indians speak a
word in a certain way, that will be
the way to speak it.”
-Prof. David Crystal, Cambridge Encyclopedia of the English Language