India is currently one of the fastest-growing economies in the world, driven primarily by its service, industrial, and agricultural sectors.1 It is also the world’s fifth-largest economy in terms of nominal gross domestic product (GDP) .2 Overall, in 2022, the economy of India grew at a rate of 7.2%.3 This growth was primarily due to strong demand for the country’s goods and services, in addition to a high level of industrial activity. The country, once a supplier of British tea and cotton, now has a diversified economy with the majority of activity and growth coming from the service industry. India is now considered a “global player” in the world of international economics.4 Key Takeaways India is currently one of the fastest-growing economies in the world. Agriculture, once India’s main source of revenue and income, has since fallen to approximately 16.7% of the country’s GDP, as of 2022. Over the past 60 years, the service industry in India has increased from a fraction of the GDP to approximately 48.4% in 2022. In 2022, over 6 million foreign tourists visited India; the World Travel and Tourism Council calculated that tourism generated 5.9% of India’s GDP in 2022. In 2020 and 2021, India’s economy was hard hit by the COVID-19 pandemic. In 2020, India’s second quarter GDP came nearly 24% below the second quarter of 2019, as the pandemic precipitated restrictions on all non-essential businesses, sharply curtailing economic activity.5 Since then, however, the economy has rebounded in notable ways. Historical Development of India’s Economy In 1947, after gaining independence from Britain, India formed a centrally-planned economy, also known as a command economy . With a centrally planned economy, the government makes the majority of economic decisions regarding the manufacturing and the distribution of products. The government focused on developing its heavy industry […]
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