Every day we know through newspapers, news channels, YouTube, social media that the country’s economy is getting weaker as compared to previous years. And the condition of the country’s economy has become fragile. And constantly we get to see news in the newspapers that the country’s banks are going into losses, inflation has crossed its extreme limit, and seeing such news, the middle class of the country is very scared, and the people who earn their living in daily life are sweating on their foreheads’. and the middle class of the country is forced to think that if the country’s economy continues to run like this then life will be very difficult in the future, but before reaching any conclusion it is very important for us to know how much truth is there in these news and in what condition is the economy of our country. And today in this article, while discussing the important aspects of the country’s economy, we will try to know how much truth is there in these stories and will analyze the country’s economy in a complete way.
HOW INDIAN GDP HAS DOUBLED IN 10 YEARS
The last decade has seen the Indian economy growing much faster than expected. While India’s GDP was $2.1 trillion in the year 2015, today in the year 2025, the IMF has estimated that the Indian economy will reach $4.3 trillion. This growth in the Indian economy is very remarkable. For the last several decades, the Indian economy has been seen as a fragile economy in which weak currency, weak trade balance and increasing dependence of the economy on FDI are some of the reasons that make India a fragile economy. But now India is constantly improving its position and is also challenging the world in the field of dynamism. And today India has reached the verge of coming out of the fragile economy.
WHY INDIA IS CONSIDERED IN FRAGILE ECONOMY
There are some important reasons for considering India’s economy as a Fragile Five economy
CASH OUTFLOWS FROM EMERGING MARKET
A major reason for considering India among the fragile five economies was that a lot of India’s money used to go out of India, meaning where foreign investors felt that they cannot make money from the Indian stock market and cannot generate that much money from the FDI perspective, they used to take out a lot of their money from the country
CURRENCY DEPRICIATION
Currency depreciation was also one of the main reasons that weakened the economy of our country. Even today our currency is depreciating but today we and our country are strongly taking steps towards the path of trade with other countries in the economic segment and are strongly challenging the same.
INFLATION UNSTABILITY
It has been seen since the last few decades that inflation is very high in India. And very soon the inflation rate of the country increases by 6 to 7%. And many times it was said that there is a lot of economic unstability in the country but today we are able to control the inflation of the country and inflation can be seen in a stable form.
Apart from this, the country’s economy was very vulnerable i.e. an economy where the currency is very soft and there are many economic turmoils. And there was a lot of dependence on foreign capital and there was a lot of political and economic impoverishment due to which it was said that the Indian economy falls in the fragile five economies but today the reality is something else because today the Indian economy has been able to come out of the fragile five segment to a considerable extent and the economy of the country is seen to be stable.
INDIA’S POSITION IN THE GLOBAL ECONOMIC CONTEXT
YEAR 2014 –
India was the 10th largest economy in the world (in context of Nominal GDP).
YEAR 2021 –
In the year 2021, we overtook Britain to become the 5th largest economy in the world.
YEAR 2026 –
It is expected that in the year 2026, India will overtake Japan to become the 4th largest economy .
YEAR 2028 –
It is projected to overtake Germany and become the 3rd largest economy in the world .
HOW INDIA’S ECONOMY GREW IN THE LAST 10 YEAR
India has achieved a growth of 105% in the last decade leaving behind many big economies of the world such as China, Germany, France, Brazil, Canada, Russia. Which is remarkable.
HOW INDIAN ECONOMY IS GROWING SO FAST
The biggest reason behind India’s economic growth is India’s huge participation in manufacturing and exports, for which the government has made many schemes like Make in India schemes, PLI schemes, etc. The government has aimed to increase the country’s participation in manufacturing. And the government has also helped a lot in increasing the economy by making all the services digital. With the help of digitization, online service, government benefits, direct benefit transfer and payment services have increased transparency a lot. Apart from this, even after the arrival of GST, transparency has continuously improved, corruption has reduced and the taxation system has also improved. And the capital expenditure of the government has increased which creates an asset and helps to improve the economy of the country .
KEY ECONOMIC DRIVERS WHO PLAYED VITAL ROLE IN THE GROWING ECONOMY
AGRICULTURE –
India is still dependent on the agriculture sector and almost 50% of employment is generated by this sector. If we look at the agricultural sector, we have seen an unexplanable growth due to HIV seeds ( High yield variety), hybrid crops, genetically modified crops and drip irrigation and micro irrigation systems.
The government has also contributed significantly in developing the agriculture sector. Be it the PM Kisan Yojana, MSP, Crop Insurance Scheme, such schemes have provided significant help to the farmers of the country, due to which the agriculture sector of the country has proved to be developing to a great extent.
Apart from this, the government has completely mechanized the agriculture sector and has increased the use of tractors, harvesters, drones and AI-powered equipment in this sector. Along with this, the government has also helped a lot in developing dairy, poultry and fisheries farming and for this the government’s Pradhan Mantri Matsya Sampada Yojana and Blue Revolution 2.O have helped these sectors to develop rapidly. And the upcoming sectors will increase the agriculture and development of the country and will provide significant contribution to the economy.
INDUSTRY –
The industries of any country play a huge role in developing its economy. Keeping this in mind, the Government of India has helped a lot in developing the manufacturing sector of the country. And has established its own centers for self-employment, due to which the manufacturing sector of the country has become very strong. For this, the government has also made some schemes which are as follows.
MAKE IN INDIA 2014 –
Domestic and foreign investment in the manufacturing sector was encouraged and India was established as a global manufacturing hub.
PRODUCTION- LINKED INCENTIVE SCHEMES 2020 –
Industries such as electronics, automobiles, pharmaceuticals, and textiles were provided financial incentives to expand manufacturing.
CARPORATE TAX CUTS 2019 –
Corporate tax was reduced from 30% to 22% (and to 15% for new manufacturing companies) to encourage investment.
FDI grew from $44 billion to over $ 83 billion in 2022.
RISE OF STARTUP’S AND MSME’S
The Government of India has paid a lot of attention to new business startups and MSMEs, that is why the government has launched the Tarun Plus scheme in the Mudra scheme under which a loan of up to 20 lakhs can be given to the startup. And the contribution of MSMEs in India’s GDP has increased to 30% and in exports it has reached 50%. India also wants to increase its contribution in the global supply chain, in which the big countries of the world want a country other than China that can fulfill their needs and today India has become very strong in its manufacturing sector, due to which India is emerging as a better option. Due to which the whole world is focusing on the China Plus strategy because big companies of the world like Apple, Microsoft, Samsung are opening their units in India which are making a significant contribution to India’s economy.
TECHNOLOGY AND DIGITALIZATION
The Indian government has given a lot of emphasis to new technologies and making services digital. Be it payments, a government scheme or direct benefits given to the people by the government. the government has made all these easy through technology and digitalization.
- UPI, Aadhaar , and digital payments have cut costs and improve efficiency .
- increase financial inclusion and reduced corruption .
- PM Jan Dhan yojana opened more than 500 million bank account , and many linked to Adhaar.
- The E- Rupee was introduced as a prepaid digital currency system to ensure targeted delivery of welfare benefits.
GST REFORMS
The Indian government was facing the most difficulty in tax collection due to which tax fraud was constantly increasing and people were not paying taxes on time. But since the introduction of GST, it has improved the tax system to a great extent. And GST has promoted one nation one tax in the country.
- Ease of doing businesses promoted by GST .
- Increase tax collection – pre GST tax collection 2016-2017 was Rupees 8.63 lakh crore which increased in 2023-2025 GST collection was Rupees 20.17 lakh crore .
NOTE-Indian government now collects Rupees 1.6 to 1.8 lakh crore GST per month .
BANK REFORMS
The Government of India and RBI have brought about a lot of improvement in the condition of the banks of the country. The strong mechanism of RBI has made the banks very strong. And where in the year 2018 the NPA of the banks was up to 11.2%, today it has come down to 3.9%. And the monetary policy committee has also become better synchronized between the RBI and the Government, through which the Government and RBI together control the Repo rate and can control the inflation between 2% to 6% which used to increase to a great extent earlier. And digitization has also improved to a great extent and increased transparency. This shows that today the banks of the country are more profitable and healthier.
FOREIGN DIRECT INVESTMENT
FDI in India is growing steadily and the figure which was $45.15 billion in 2014-15 is projected to increase to $85 billion in 2023-24. As a result, India has become one of the top 5 FDI recipients today.
CONCLUSION
India’s economy and GDP have seen a constant growth in the last 10 years. Today India is capable of taking on the biggest economies of the world and today India stands strongly on its own.
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