INDIA’S ECONOMIC POTENTIAL IS NOT OVERSTATED/OVERRATED

Neha Pathak

Sai Pooja Amar

Ankita Tiwari

Akthar Raza

Sai Krishna Chaitanya Potharaju

HG Arthur Denzlin

Afzal Hussain

“India will become the third largest economy in the world after China and the United States of America by 2025” Graeme Wheeler, Managing Director World Bank

“India is poised to emerge as the third largest economy in the world after US and China by 2025.” Nareshwar Dayal, Indian High Commissioner to Britain

Agenda

Forecast HG Arthur Denzlin

RBI’s Efficiency, Budget and Entrepreneurship Ankitha Tiwari

Agricultural, Industrial & Service sectors Saikrishna Chaitanya

FDI and Retail Attractiveness Akthar Raza

Macro Economic variables Neha Pathak

HDI and Human Resource Saipooja Amar

10 areas where reforms are needed Afzal Hussain

BRIC Report

By 2025 the Indian economy is projected to be about 60 per cent the size of the US economy. The transformation into a tri-polar economy will be complete by 2035, with the Indian economy only a little smaller than the US economy but larger than that of Western Europe.

Tri Polar Economy

World

Forecast

2050 Rank

Country Name

2000GDP

2010 GDP

2020 GDP

2030 GDP

2040 GDP

2050GDP

1 China 1078 2998 7070 14312 26439 4445

3

* European Union 9395 12965 16861 2107

5 28323 35288

2 United States 9825 13271 16415 20833 27229 3516

5

3 India 469 929 2104 4935 12367 27803

4 Japan 4176 4601 5221 5810 6039 6673

5 Brazil 762 668 1333 2189 3740 6074

6 Russia 391 847 1741 2980 4467 5870

7 United Kingdom 1437 1876 2285 2649 3201 3782

8 Germany 1875 2212 2524 2697 3147 3603

9 France 1311 1622 1930 2267 2668 3148

10 Italy 1078 1337 1553 1671 1788 2061

Source: Goldman Sachs report

If this is overstated, then see this??Growth rate of GDP of 6.9%

INDIA’S EFFICIENT RBI

During the recession times , RBI came up with effective monetary polices.

Ensured appropriate liquidity in the system, consistent with objective of price and financial stability.

BUDGET 2010-2011

Increased the tax base and DTC leading to relief for the middle and the salaried class.

‘A coin gains more value as it changes ownership’.

Government committed to growth of SEZs. Four-pronged strategy for growth of agricultural

sector. Emphasis on infrastructure pumping and

withdrawal of subsidies. Given scope to private business . Private

banking, mining, small industries are in scope.

Entrepreneurship

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Entrepreneurship helps Economy…

Generate Employment Revenues for the Government Inclusive Growth New Technology Development of the society Gives higher purchasing power to the

people of the country

Share of GDP

Sector 2009

GDP breakdown Agriculture17.5% Services 62.6% Industry 19.9%

Labor breakdown Agriculture52% Service 34% Industrial 14%

Agricultural sector

Agriculture is generally described as the backbone of Indian economy and is at the core of socio economic development of the country

The agricultural sector contributes proportionally more to poverty reduction than growth in any other economic sector and that therefore alone, the focus should be on the agricultural sector

Growtrh rate

2003 2004 2005 2006 2007 2008 2009

66.5

7.47.9 7.5

8.5

4.8

Industrial production Growth rate

Industrial production Growth rate

Reasons for the growth of Services and Manufacturing sector

India opens up The rise of the financial sector Back-office to the world The Golden Quadrilateral The great migration

Attracting FDI

“India has the highest returns on foreign investment” US Department of Commerce India 19.3% China 14.7% Thailand 13.0%

“India is amongst the three most attractive FDI investments in the world.” AT Kearney FDI Confidence Index 2010

Country 2010 Rank

2007 Rank Change

China 1 1 0United States

2 3 +1

India 3 2 -1Brazil 4 6 +2

Germany 5 10 +5

Retail Attractiveness

India has been ranked 1st by AT Kearney in a Global Retail Development Index of 30 developing countries and is seen as a potential gold mine.

2009 A.T. Keareny Global Retail Development Index

Per capita income

1999-00

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

15886 1672917883

1898821142

23222

2728429382

33283

37490

per capita income

per capita income

Literacy Rate in India

Percentage of people under poverty line

By 2014-15, over 63 million households are expected to have an annual income of over US$ 6,000 per annum (US$ 30,000 in PPP* terms)

Unemployement in India

2003 2004 2005 2006 2007 2008 20090123456789

10

8.89.5 9.2 8.9

7.87.2 6.8

% of unemployement

% of unem-ployement

India in terms of HDI

The HDI for India is 0.612, which gives the country a rank of 134th out of 182 countries

Life expectancy at birth: 63.4years and ranked 128th

Adult literacy rate: 66% and ranked 120th

Combined gross enrolment ratio: 64% and ranked 134th

GDP per capita(PPP): US$2753 and ranked 128th

HDI cont…

There are 5,886.9 thousand migrants which represent 0.5% of the total population.

Remittances are sent to immediate family members who have stayed behind, are among the most direct benefits from migration, the benefits spread broadly into local economies as they also serve as foreign exchange earnings for the origin countries of migrants.

India topped in the inflow of remittances with US$ 35262millions of the total US$ 370billions.

With over 380 universities, 11,200 colleges and 1,500 research institutions, India has the second largest pool of scientists and engineers in the world. Over 2.5 million graduates are added to the workforce every year, including 300,000 engineers and 150,000 IT professionals.

10 areas where reform is needed

1. Improve governance2. Raise educational achievement3. Increase quality and quantity of

universities4. Control inflation5. Introduce a credible fiscal policy6. Liberalise financial markets7. Increase trade with neighbours8. Increase agricultural productivity9. Improve infrastructure10. Improve Environmental Quality

Thank You

?? QUESTIONS ??