Indian Economy

Indian Economy
Dr. Fahad Khan

Ph.D (Management)
MBA(Marketing)
M.Com, M.A. (Economics)
PGPM (Human Resources)
PGD (Retail Management)
Introduction to Indian Economy
 The Indian economy is the sixth-

largest economy in the world.
Globalisation, integration into the
global economy, investment rates, a
young population, and a low
dependence ratio are all contributing
factors. As per the records of the
International Monetary Fund, India is
ranked 128th by GDP in purchasing
power parity and is ranked 144 by
GDP in nominal on a per capita income
Introduction to Indian Economy
 At the end of the year 2018, the Indian

economy was the fastest developing
major economy and had even suppressed
China at the time. Although the Indian
economy currently looks to be rising in
the right direction, it was continuously
slowed down from 2017 to 2020 due to
demonetisation in 2016, the introduction
of GDP in 2017, and due to the COVID-19
in the years 2020 and 2021.
Nature of the Indian Economy
 The Indian economy is a mixed
economy, which means that a part of
the economy is owned by private
businessmen, industrialists, and
entrepreneurs. The other part is
managed by the government. The
Indian economy is highly dependent on
the service sector because of its
contribution to the GDP of India which
is equal to 60% of the total. It is
followed by agriculture.
Sector Contributing to the
Indian Economy
Since the Independence of India,
the agriculture sector has been
constantly decreasing, while the
service sector has increased
gradually. Also, the industrial
sector had improved as well.
Sector Contributing to the Indian
Economy
 Agriculture: The agriculture sector contributes 14% of
the total GDP of India. Crops, horticulture, milk and animal
husbandry, fishing, aquaculture, apiculture, sericulture,
forestry, and other associated activities are all included.
 Industry: The industrial sector contributes 27% of the
total GDP of India. It comprises a variety of manufacturing
and other sub-sectors.
 Service: The service sector contributes 59% of the total
GDP of India. It encompasses construction, retail, software,
information technology, communications, hospitality,
infrastructure operations, education, healthcare, banking,
and insurance, as well as many other economic activities.
Salient Features of the Indian
Economy
Poor Infrastructural Development
 Asper a recent report, India needs almost $100
million in infrastructure, to ensure the entire
population benefits from electricity, gets safe
drinking water, and proper sanitation services.
 Imperfect Market
 The Indian markets have a lot of easily
exploitable loopholes. With an improper supply
chain, the prices in the market vary
significantly at different locations.
Economy
Low per Capita Income
 The revenue of a country is highly
dependent on the purchasing power of the
population; the more they spend or purchase
products, the more is the increment in the
revenues of the nation. However, to spend,
the population must earn more and must be
able to fulfil their basic needs. Only then can
they manage to purchase other facilities and
comfort. Therefore, per capita income is one
of the key factors.
Economy
 High rate of Population Growth
 With a vast population comes the requirement of
resources. India is the world’s second-largest
country in terms of population. This population
needs education, food, transportation, water
resources, employment, and other basic necessities
to contribute to the development of the nation. As
these resources are not available in sufficient
quantities in India, it is highly challenging for the
nation to develop. And if this continues, the nation
will be in a perpetual developing stage.
Economy
 Poverty
 It has been said, “A nation will be poor if it’s poor”,
and this is an endless loop. Such loops of poverty
always hinder the progress of a country and are a
major issue for a country to be reckoned as a
developed nation.
 Unadvanced Technology
 Most of the work done in India is labour-intensive
work. Thus, there is a huge gap between the
technology required in the industries and what is in
use in the country.
Economy
Income Disparity
 The concentration of wealth in the
country is highly focused and is
possessed by 1% of the population of
the nation. This 1% of the population
owns 53% of the wealth within the
country. Therefore, poverty is one of
the important points that the
government needs to highly focus on.
Economy
 Agro-based Economy
 The Indian economy is highly dependent on the
agriculture sector. This sector adds up to almost 14%
of the total GDP of the country, and more than half of
the population of the country is dependent on this
sector.
 Capital Formation
 The average income of a person in India is very low
and the GDP of the country is dependent on this.
Therefore, there is a significant need for
improvement in the rate of capital development.
Economy
 Social issues
 Indian society is referred to as a
backward society. This is due to
communalism, a highly male-dominated
social structure, a regressive caste
system, and other such malice.
Thank you!!

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Dr. Fahad Khan

 The Indian economy is the sixth-

 At the end of the year 2018, the Indian

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