Reimagining India: Unlocking the Potential of Asia’s Next Superpower (50 page)
Read Reimagining India: Unlocking the Potential of Asia’s Next Superpower Online
Authors: McKinsey,Company Inc.
A REMARKABLE RISE
1991 GLOBAL RANKING
BY PPP-ADJUSTED GDP ($ BILLION)
When India started reforms in 1991, the size of its economy was comparable to those of much smaller countries.
AN ENIGMATIC ECONOMY
The rise of India’s information technology and outsourcing sectors is a familiar story. But while India is a technology titan, it’s also an agrarian country where wealth comes from energy and natural resources.
Since economic liberalization began in 1991, India has experienced strong growth on the way to becoming one of the world’s largest economies.
2013 GLOBAL RANKING
BY PPP-ADJUSTED GDP ($ BILLION)
AGRICULTURE
SHARE OF TOTAL EMPLOYMENT: 53%
Agriculture is still what the vast majority of Indians do for a living, but it also counts for a shrinking share of the country’s economic activity. Indian farmers must become more productive to feed a growing population and compete in export markets.
SHARE OF GDP
|
|
1990 | 2012 |
29% | 18% |
SERVICES
SHARE OF TOTAL EMPLOYMENT: 21%
The technology sector is a symbol of India’s economic progress. But the combined workforces of the ten biggest IT firms total less than half the number of jobs at government-owned Indian Railways, the country’s largest employer.
SHARE OF GDP
|
|
1990 | 2012 |
44% | 56% |
INDUSTRY
SHARE OF TOTAL EMPLOYMENT: 19%
Manufacturers rank among India’s most profitable companies and industry has the potential to create great wealth and new jobs, but India hasn’t yet realized its potential as a place that makes things.
SHARE OF GDP
|
|
1990 | 2012 |
26% | 27% |
Sources: International Monetary Fund, World Economic Outlook Database, October 2012
PROSPERITY AND INEQUALITY
Indians and foreigners alike often presume that the country’s cultural fault line is between the impoverished, struggling north and the rapidly developing south. But economic and population data shows that levels of development vary widely across the country and within regions.
In the past decade, the population of India’s north and east has grown faster than that of the south and west. Typically, slowing population growth goes hand-in-hand with rising levels of income and urbanization.
