As measured by the Purchasing Power Parity (PPP), India is the third largest economy in the world with an ever growing GDP of 9.2%. This makes India, a country with the second fastest growing economy in the world. India is the tenth largest economy in the world if the growth is measured in USD exchange rates. Since India is the country with the second largest population, its per capita income is quite nominal. This makes India a low income economy.

Just as Indian topography and culture, India’s economy too is diverse. It encompasses varied fields such as agriculture, manufacturing, textile, infrastructure, handicrafts and handloom industry and a host of different service sectors. Most of the population of India earns their living through agriculture and related activities. However, with globalization and opening up of the world economies, the manufacturing and the service sector are also coming up in a big way especially in the urban metropolitan areas. One of the major benefits India possesses is the large amount of youth population which falls in the age category of 18 to 30. These young educated people in this digital age are being employed for outsourcing and back offices work of global companies that are being carried out in India extensively. India is known for its highly-skilled workers in software engineering and financial services. Sectors like pharmaceutical, biotechnology, telecommunication, shipbuilding, aviation etc too are showing strong growth. The strength of Indian economy lies in its vast pool of educated and skilled population. However economy weakness of India is the continuing public-sector budget deficit, which is nearly 10% of GDP.

Indian history showed that government placed strict control over private sector participation, FDIs and foreign trade. However after the 1990 liberalization and privatization, India gradually opened up its economy. It started encouraging private sector participation and relieved restrictions on international trade. India has emerged as one of the wealthiest economies in the developing world post 1990. Not just that, the life expectancy rates, literacy rates and food provision rates have also been significantly improved. This shows that India has truly achieved what is termed as ‘inclusive growth’.

India is a country with a wide gap between the rich and the poor. Hence it is a challenge for India to reduce the socio-economic inequality amongst the population. Poverty still remains a major issue for the government even after implementing many economic reforms.

With the accelerated GDP reports of India, Goldman Sachs has predicted that India will overtake the GDP of France and Germany by 2020. India has made provisions for setting up Special Economic Zones(SEZ) and software parks that offer tax benefits and better infrastructure to set up business which will in turn benefir the country. Mumbai city remains the economic capital of the country with RBI(Reserve Bank of India) and the Stock Exchange located here.

Indian growing economy is truly exploring all its potential to develop in the holistic manner..