India’s GDP Growth Rate: Economic Growth & Its Future Forecasts

India has emerged as the fastest-growing major economy in the world and is expected to be one of the top three economic powers in the world over the next 10-15 years, backed by its robust democracy and strong partnerships.

The Indian economy expanded 6.3% YoY in Q3 2022, slightly higher than forecasts of 6.2%, but well below a 13.5% growth in Q2, as distortions caused by COVID lockdowns faded, high prices and rising interest rates weighed on demand and slowing global demand started to impact exports. Private spending slowed sharply (9.7% vs 25.9%), investment growth halved (10.4% vs 20.1%), and both exports (11.5% vs 14.7%) and imports (25.4% vs 37.2%) rose at a slower pace. Meanwhile, stocks declined faster (-19.4% vs -17.4%) and public expenditure shrank (-4.4% vs 1.3%). On the other hand, government spending increased more than 40% as the government stepped up expenditure on infrastructure. On the production side, trade, hotels, transport, and communication recorded the biggest increase (14.7%), followed by financial, real estate (7.2%), construction (6.6%), public administration (6.5%), utilities (5.6%) and farm (4.6%). On the other hand, both manufacturing (-4.3%) and mining (-2.8%) contracted.

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What Is Gross Domestic Product (GDP):

• Gross domestic product (GDP) is the total monetary or market value of all the finished goods and services produced within a country’s borders in a specific time period.
  • As a broad measure of overall domestic production, it functions as a comprehensive scorecard of a given country’s economic health.

Key Sectors Of The Indian Economy:

• The most important and the fastest growing sector of Indian economy are services. Trade, hotels, transport and communication; financing, insurance, real estate and business services and community, social and personal services account for more than 60 percent of GDP.
• Agriculture, forestry and fishing constitute around 12 percent of the output, but employs more than 50 percent of the labor force.
• Manufacturing accounts for 15 percent of GDP, construction for another 8 percent and mining, quarrying, electricity, gas and water supply for the remaining 5 percent.

India GDP Growth Slows to 6.3% in Q3:

• The Indian economy expanded 6.3% YoY in Q3 2022, slightly higher than forecasts of 6.2%, but well below a 13.5% growth in Q2, as distortions caused by COVID lockdowns faded, high prices and rising interest rates weighed on demand and slowing global demand started to impact exports. Private spending slowed sharply (9.7% vs 25.9%), investment growth halved (10.4% vs 20.1%), and both exports (11.5% vs 14.7%) and imports (25.4% vs 37.2%) rose at a slower pace.
• Meanwhile, stocks declined faster (-19.4% vs -17.4%) and public expenditure shrank (-4.4% vs 1.3%). On the other hand, government spending increased more than 40% as the government stepped up expenditure on infrastructure. On the production side, trade, hotels, transport, and communication recorded the biggest increase (14.7%), followed by financial, real estate (7.2%), construction (6.6%), public administration (6.5%), utilities (5.6%) and farm (4.6%). On the other hand, both manufacturing (-4.3%) and mining (-2.8%) contracted.

Current Forecasts About India’s GDP Growth Rate:

The United Nations Conference on Trade and Development (UNCTAD) expects India’s economy to grow 5.7% in 2022 and 4.7% in 2023. India’s gross domestic product (GDP) grew 8.7% in FY22.

India: 5th largest Economy:

India became the world’s fifth largest economy by overtaking the United Kingdom. Now, the United States, China, Japan, and Germany are the only nations with economies larger than India’s.

Key Highlights of this Achievement:

• New Milestone:
  • Moving past one of the biggest economies in the world, especially one that ruled over the Indian sub-continent for two centuries, is a major milestone.
• Size of Economy:
  • The size of the Indian economy in ‘nominal’ cash terms in the quarter through March, 2022 was USD 854.7 billion while for UK was USD 816 billion.
• Comparison with United Kingdom:
  • Population Size:
    • As of 2022, India has a population of 1.41 billion while the UK’s population is 68.5 million.

• Poverty:
  • The low per capita incomes often point to high levels of poverty.
  • At the start of the 19^th century, the UK’s share in extreme poverty was considerably higher than India’s.
    • However, the relative positions have reversed even though India has made giant strides in curbing poverty.

India’s Recent Growth Timeline:

• India gdp growth rate for 2021 was 8.95%, a 15.54% increase from 2020.
• India gdp growth rate for 2020 was -6.60%, a 10.33% decline from 2019.
• India gdp growth rate for 2019 was 3.74%, a 2.72% decline from 2018.
• India gdp growth rate for 2018 was 6.45%, a 0.34% decline from 2017.

India’s GDP Growth: Decadal Growth Rate:

India GDP Growth Rate
Year	GDP Growth (%)	Annual Change
2021	8.95%	15.54%
2020	-6.60%	-10.33%
2019	3.74%	-2.72%
2018	6.45%	-0.34%
2017	6.80%	-1.46%
2016	8.26%	0.26%
2015	8.00%	0.59%
2014	7.41%	1.02%
2013	6.39%	0.93%
2012	5.46%	0.22%
2011	5.24%	-3.26%
2010	8.50%	0.64%