India has undertaken a journey on the path of development which is steady and indicates the coming of a bright future ahead, and it is also important to note here that a major boost for the Indian economy was the economic liberalization of India back in the year 1991, when the country was opened up for the global economy. Therefore, in order to take a gander at the economic development which India has achieved, it is important to compare where India stood back in 1991 and where it stands now.
Prior to this comparison, let us have a look at some key factors related to the country and its economy’s functionality. As per 3one4 Capital’s new report, India- A Startups Nation, the current population of India stands at 1.415 billion, as of January 2023, and the population growth rate is 0.80 percent. Looking at the male life expectancy in the country, as of December 2020, it is 68.71 years, with the total fertility rate being 2.0 as of December 2021. And female life expectancy, as of December 2020 is 71.49 years.
The literacy rate of the country is at 78 percent according to the National Family Health Survey-5, ranging from 2019 to 2021. As per the Economic Survey of 2022-23, the GDP of the country at current prices is US$ 3, 469 billion, and as per the same survey, the real GDP growth rate is 7 percent. As per 2023 estimates, the GDP (in PPP) of India is US$ 12, 200 billion. Next, as per the Second Advance Estimates (SAE) of 2022-23, the per capita income of India is US$ 2, 467, with exports (goods and services) being US$ 763 billion. The imports (goods and services) are US$ 916 billion. As per March 2023, India’s foreign exchange reserves stand at US$ 578.8 billion.
According to the Ministry of Finance, the governmental external borrowings are at US$ 129 billion, as of March 2023, and the external debt, both government and non-government is US$ 613.3 billion. The interest to gross revenue, as per the 2023 Revised Estimates (RE) (Budget) is 22 percent, and lastly, the gross debt/GDP ratio is 82 percent according to 2022 estimates.
Now, in order to determine India’s leap of development from the economic liberalization, we need to have a look at the key economic factors and where they stood back in 1991. In 1991, the population of the country was 0.89 billion, hence, making the Compound Annual Growth Rate (CAGR) 1.49 percent currently. The life expectancy in the country was 58.8 years back in 1991 which, in 2023, is 70.19 years, making the CAGR 0.55 percent. And while the literacy rate was 52 percent in 1991, it is 78 percent in 2023, with the CAGR being 1.28 percent.
At a CAGR of 0.87 percent, the GDP growth rate has jumped from 5.3 percent in 1991 to 7 percent in 2023, and with a CAGR of 13.08 percent, the GDP (at current prices) in INR was 5.32 lakh crores in 1991, which in 2023, has reached 272 lakh crores. In US$, it was 275 billion in 1991, and is 3, 469 billion in 2023, making the CAGR 8.24 percent. The per capita income of the country in 1991 was 310 US$, and in 2023, it is 2, 467 US$.
The exports (goods and services) in 1991 were at US$ 18 billion, and in 2023, they are at US$ 763 billion, making the CAGR 12.42 percent. The imports on the other hand, were at US$ 24 billion in 1991 and are at US$ 916 billion in 2023, which makes the CAGR 12.05 percent. In 1991, the share of India in world trade (exports and imports) was 1 percent, and in 2023, it has risen to 3 percent, the CAGR being 3.49 percent.
The foreign currency reserves of India in 1991 were US$ 5.8 billion, and in 2023, they are US$ 578.8 billion, making the CAGR 15.47 percent. With a CAGR of 4.90 percent, the exchange rate is US$ 82.68 in 2023, which was US$ 17.9 in 1991. The gross savings (% of GDP) of India in 1991 were 21.9 percent, which have risen to 30.2 percent in 2023, and the gross domestic investment (% of GDP) was 22.5 percent in 1991, being 31.4 percent in 2023.
These comparative statistics of 2023 and 1991 show that in the 30-year time period post the liberalization of its economy, India has come a long way as far economic development is concerned, and the growth shows huge positivity as far as India’s aim of soon becoming a US$ 5 trillion economy is concerned.