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India Economic overview: India's economy encompasses traditional village farming modern agriculture handicrafts a wide range of modern industries and a multitude of support services. 67% of India's labor force of nearly 400 million work in agriculture which contributes 30% of the country's GDP. Production trade and investment reforms since 1991 have provided new opportunities for Indian businesspersons and an estimated 300 million middle class consumers. New Delhi has avoided debt rescheduling attracted foreign investment and revived confidence in India's economic prospects since 1991. Many of the country's fundamentals - including savings rates (26% of GDP) and reserves (now about $24 billion) - are healthy. Inflation eased to 7% in 1997 and interest rates dropped to between 10% and 13%. Even so the Indian Government needs to restore the early momentum of reform especially by continuing reductions in the extensive remaining government regulations. Moreover economic policy changes have not yet significantly increased jobs or reduced the risk that international financial strains will reemerge within the next few years. Nearly 40% of the Indian population remains too poor to afford an adequate diet. India's exports currency and foreign institutional investment were affected by the East Asian crisis in late 1997 and early 1998 but capital account controls a low ratio of short-term debt to reserves and enhanced supervision of the financial sector helped insulate it from near term balance-of-payments problems. Export growth has been slipping in 1996-97 averaging only about 4% to 5%—a large drop from the more than 20% increases it was experiencing over the prior three years—mainly because of the fall in Asian currencies relative to the rupee. Energy telecommunications and transportation shortages and the legacy of inefficient factories constrain industrial growth which expanded only 6.7% in 1997—down from more than 11% in 1996. Growth of the agricultural sector is still fairly slow rebounding to only 5.7% in 1997 from a fall of 0.1% in 1996. Agricultural investment has slowed while costly subsidies on fertilizer food distribution and rural electricity remain. A trend has been set for continuous economic growth irrespective of the government in power. Indian think tanks aim for GDP growth of at least 7% in 2005, after over 8% growth in 2004. GDP: purchasing power parity—$3.022 trillion (2003 est.) GDP—real growth rate: 7.6% (2003 est.) GDP—per capita: purchasing power parity—$2,900 (2003 est.) GDP—composition by sector: agriculture: 23.6% industry: 28.4% services: 48% (2002 est.) Inflation rate—consumer price index: 4.6% (2003 est.) Labor force: total: 406 million (1999 est.) by occupation: agriculture 60% services 23% industry 17% (1995 est.) Unemployment rate: NA% Budget: revenues: $39 billion expenditures: $61 billion including capital expenditures of $10 billion (FY97/98 est.) Industries: textiles chemicals food processing steel transportation equipment cement mining petroleum machinery , computers, information technology and software, pharmaceuticals Industrial production growth rate: 6.7% (1997 est.) Electricity—capacity: 83.288 million kW (1996) Electricity—production: 398.28 billion kWh (1995) Electricity—consumption per capita: 427 kWh (1995) Agriculture—products: rice wheat oilseed cotton jute tea sugarcane potatoes; cattle water buffalo sheep goats poultry; fish catch of about 3 million metric tons ranks India among the world's top 10 fishing nations Exports: total value: $33.9 billion (f.o.b. 1997) commodities: gems and jewelry clothing engineering goods chemicals leather manufactures cotton yarn and fabric partners: US Hong Kong UK Germany Imports: total value: $39.7 billion (c.i.f. 1997) commodities: crude oil and petroleum products machinery gems fertilizer chemicals partners: US Belgium Germany Kuwait Saudi Arabia UK Japan Debt—external: $90.7 billion (1997) Economic aid: recipient: ODA $1.237 billion (1993); US ODA bilateral commitments $171 million; US Ex-Im bilateral commitments $680 million; Western (non-US) countries ODA bilateral commitments $2.48 billion; OPEC bilateral aid $200 million; World Bank (IBRD) multilateral commitments $2.8 billion; Asian Development Bank (AsDB) multilateral commitments $760 million; International Finance Corporation (IFC) multilateral commitments $200 million; other multilateral commitments $554 million (1995-96) Currency: 1 Indian rupee (Re) = 100 paise Exchange rates: Indian rupees (Rs) per US$1—39.358 (January 1998) 36.313 (1997) 35.433 (1996) 32.427 (1995) 31.374 (1994) 30.493 (1993) Fiscal year: 1 April—31 March
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