DEVELOPMENT
IN INDIAN
ECONOMY
ECONOMICS PROJECT SHREYA SINGH
XI-G
what is an
economy?
An economy is an area of the
production, distribution and trade, as
well as consumption of goods and
services.
HISTORY:
Ancient India
-India was one of the richest countries in the world, for
about two and a half millennia starting around the end of
1st millennium BC and ending around the beginning of
British rule in India.
-The Indian subcontinent had the largest economy of any
region in the world for most of the interval between the
1st and 18th centuries. From 1-1000 AD India constituted
roughly 30% of the world's GDP.
HISTORY:
Post-Independence
In the 1980s, growth improved significantly, with an
annual GDP growth rate of 5.5%, driven by increased
investment and investment rose from 19% of GDP to
nearly 25% within 10 years.
-Economic liberalisation measures were enforced in
response, reaffirmed by the government in power from
June 1991 onwards.
HISTORY:
Colonial Era
-The ruthless exploitation under British colonial rule
completely devastated India's economy. India's
population was subject to frequent famines, had one of
the world's lowest life expectancies, suffered from
widespread malnutrition and was largely illiterate.
-India experienced deindustrialisation and destruction of
various craft industries under British rule, which along
with fast economic and population growth in the Western
world, resulted in India's share of the world economy
declining from 24.4%to 4.2%, and its share of global
industrial output declining from 25% to 2%.
-Due to its ancient history as a trading zone and later its
colonial status, remained economically integrated with
the world, with high levels of trade, investment and
migration.
HISTORY:
Post-Independence
-Post-independence, India adopted centralised planning
with Five Year Plans, the First Five Year Plan began in
1952, which mainly focused on agricultural development.
-Efforts were also made towards establishing modern
industries, scientific and technological institutes, and
space and nuclear programs.
-From 1951 to 1979, the economy grew at an average
annual rate of 3.1%, with industry outpacing agriculture.
GDP growth over the
years
1980s 1990s 2000s 2010s 2020s
The GDP growth rate The GDP growth the GDP growth rate the GDP growth rate the growth rate
ranged from 3.8 to rate ranged from 1 ranged from 3.09 to ranged from 3.87 to ranged from -5.83 to
10.18 per cent. The to 8.5 per cent. 8.06 per cent. Highest 8.50 per cent. Highest 9.05 percent highest
highest being 10.18 in Highest being 8.5 in being 8.06 in 2006 being 8.50 in 2010 being 9.05 in 2019
1988 and lowest 1999 and 1.1 in 1991. and lowest being 3.09 and lowest being 3.87 and lowest being
being 3.5 in 1982. in 2009 in 2019. -5.83 in 2020.
source: https://www.macrotrends.net/countries/IND/india/gdp-growth-
rate
In the Indian Economy
1. Change in share of GDP
Primary sector includes agricultural The share of primary sector in GDP was 56.5
and allied activities, secondary sector per cent in 1950-51 declined to 34.6 per cent
includes manufacturing industries and in 1990 91 and then to 19.7 per cent in 2007-
tertiary sector includes services. 08.
The secondary sector’s share in GDP was
With economic development India has 13.6 per cent in 1950-51 increased to 23.2 per
shfted from primary to tertiary sector. cent in 1990-91 and further to 24.7 per cent
Tertiart sector is now the biggest in 2007-08.
contributor in India’s GDP. Tertiary sector’s share in GDP increased
from 29.9 per cent in 1950-51 to 55.6 per cent
in 2007-08, and in 2009-10 it was over 7 per
cent.
2. GST implementation and
manufactural and
industrial policies
The introduction of the Goods and There have been efforts to boost
Services Tax (GST) in 2017 aimed to manufacturing under initiatives like "Make
simplify India's complex indirect tax in India" to promote domestic production,
structure. attract foreign investment, and create
GST has brought about significant employment opportunities.
changes in the taxation system, Policies such as the Production-Linked
simplifying compliance for businesses, Incentive (PLI) scheme have been
improving tax collections, and introduced to incentivize manufacturing in
promoting formalization of the key sectors like electronics, automobiles,
economy. and pharmaceuticals.
3. DIGITALISATION OF
INDIAN ECONOMY
Shift towards a Digital Economy: India has been
witnessing a significant transition towards a
digital economy, fueled by initiatives like Digital
India and increasing internet influence. This
shift has led to the growth of e-commerce,
digital payments, online services, and fintech
innovations.
During demonetisation, the scarcity of cash and
availability of electronic transaction platforms
compelled many people to use electronic
modes of payment.
The impact digitalisation has had is that more
people are now financially literate about e-
banking and card transaction. Our economy is
slowly shifting to a cashless economy
