India's growth reality check...

India’s growth can be understood through its GDP growth rate. Since FY20 India’s real GDP has grown at CAGR of just 4.8%. This is contrast to almost 7% annual average growth rate since 1991 economic reforms.

The article is based on the First Advance Estimates of India's GDP growth for 2024 and 25

India’s nominal GDP at the exchange rate of ?85 to a dollar is $3.8 trillion. In Rupees equivalent it is ? 324 lakh crore. However, in everyday use it is real GDP that matters. This is derived by removing inflation from nominal GDP. According to MOSPI, India's real GDP is 57% of nominal GDP, which is around ? 185 lakh crore in financial year 25, regardless of whether one looks at nominal GDP or real GDP. The data shows that India’s economic output is Declining.

Let us see the composition of India’s GDP?

60% of India’s GDP is contributed by Private final consumption expenditure?

10% of GDP contributed by the Government final consumption expenditure?

30% of the GDP is contributed by fixed capital formation, which is constructing roads, buildings, providing new infrastructures, etc.

India typically imports more than its exports. This engine drags down overall GDP contributing negatively to GDP.?

Let us see what is holding India’s GDP growth?

The private final consumption expenditure is expected to grow 7.3% this year, but in reality, it grew by only 4.8%, which means people are spending less, if people spend less it dissuades the private sector from investing more in the economy?

Government spending, unlike other players in the economy, can potentially spend in excess of its income. When the rest of the economy struggling. The government is expected to borrow money or print it and spend it in a manner that Reena charges the economy higher the government’s own spending has grown just 4.2% in current year and an average of 3.1% since the start of 2019?

Productive capacity spending towards productive capacity increases either because private businesses find it profitable to expand capacity or because government Post capital expenditure in the current year. This is expected to rise by 6.3% but over a slightly longer period, it has grown up by just 5.3% annually?

Net export in the most years, net exports is negative number as such negative growth rates in this category development for the current year and in the recent passed, the cap, exports and imports has reduced?

On the face of it, India’s economy has registered world beating growth rates of GDP since after Covid pandemic. But as a data shows a large part of India’s recent high growth rates was the result of low of GTP. Thanks to contraction of GTP 2021?

Has the GDP growth reduced equality,?

Has the GDP growth translated into happiness index?

Has the GDP growth translated into better climate for the entire India?

Has the GDP growth given a peaceful India?

Has the GDP growth reduced our unemployment in India?