### Summary
According to a report from SBI Research, the per capita income of Indians is expected to increase from Rs 2 lakh in FY23 to Rs 14.9 lakh in FY47, coinciding with India's 100 years of Independence. The report also highlights the growth in the number of taxpayers and the increase in income levels for the middle class.
### Facts
- 💰 The per capita income of Indians is projected to increase from Rs 2 lakh in FY23 to Rs 14.9 lakh in FY47.
- 📈 37% of the total formal labor force in India currently pays taxes.
- 💸 64% of income tax returns in India are below Rs 5 lakh and are exempt from paying taxes.
- 📊 The number of taxpayers in India has risen from 30 million to close to 68 million, and could reach 85-90 million with pending late returns.
- 💵 13.6% of taxpayers have moved into higher-income brackets.
- 💼 The growth in income levels represents a significant progression for India, which has become the fifth-largest economy in terms of GDP.
- 💭 The income growth should not be criticized in terms of inflation, as even after adjusting for inflation, income has more than doubled in the last 10 years.
- 📉 The Gini Coefficient Index shows that the income gap between rich and poor states in India is narrowing, indicating improved economic benefits for all states.
### Source
- [CNN News18](https://www.news18.com/news/business/income-of-indian-middle-class-expected-to-increase-to-rs-15-lakh-by-2047-sbi-research-5522439.html)
### Summary
Commerce Minister Piyush Goyal stated that despite short-term inflation hiccups, India has achieved nearly a decade of controlled inflation, offering the lowest rates in the country's history.
### Facts
- 💰 Headline retail inflation reached a 15-month high of 7.44% in July, surpassing economists' expectations of 6.6%.
- 🌽 Vegetable prices and sustained cost pressures in staples like cereals and pulses contributed to the high Consumer Price Index (CPI) for July.
- 🍅 The government implemented various measures to curb food price rise, including distribution of discounted tomatoes and conducting e-auctions for rice and wheat.
- 💼 Commerce Minister Goyal expressed confidence in India's economy, highlighting comfortable foreign exchange reserves and high growth.
- 🌍 With a young demographic dividend, India aims to become a $35-trillion economy and one of the world's top three economies in the next 30 years.
- 📈 India is currently the fastest-growing economy and is projected to achieve a GDP growth of 6.5% for the current financial year.
- 🇮🇳 The current government inherited challenges such as unpaid oil bond debt, high interest costs, and faltering exports from the previous government.
- 🌱 Goyal emphasized the importance of sustainable and inclusive growth alongside value creation for shareholders.
### Summary
India's economy is growing rapidly and is projected to become the third largest economy by 2031. However, there is a significant disparity in per capita income among states, with some states significantly behind the national average.
### Facts
- India is the fastest-growing large economy globally and is driving cost competitiveness.
- India's middle class is estimated to reach 61% of the population with an average income of Rs 20 lakh.
- By 2031, India's GDP is expected to cross the $10 trillion mark.
- Per capita income in India has increased from Rs 90,688 in 2013 to Rs 196,983 in April 2023.
- Telangana, Karnataka, and Haryana have the highest per capita income, while Bihar, Uttar Pradesh, and Jharkhand have the lowest.
- The per capita income of Bihar is 17% of Telangana and one-fourth of the national average.
- There is a correlation between political stability and economic performance.
- India's per capita income ranks 141st out of 191 countries.
- India needs to shift its population from low-productivity sectors like agriculture to high-income domains and increase female workforce participation.
- The necessary interventions include investment in human infrastructure, agricultural advancements, climate resilience, land and labor reforms, planned urbanization, and more.
### Summary
Last week, Moody's warned that China's aging population will impact demand for homes, reduce the labor pool, and have an impact on competitiveness. Age dependency ratios in China are increasing, indicating a higher need for healthcare services and pension payouts.
### Facts
- Moody's warned that China's aging population will be a drag on economic potential if policy measures fail to boost the birthrate and promote productivity.
- China's aging population will impact demand for homes and reduce the labor pool, leading to higher wages and a negative impact on competitiveness.
- Demographics will support housing demand in Indonesia and Vietnam over the next decade, while China experiences the opposite trend.
- The age dependency ratio in China has been increasing, indicating a higher need for healthcare services and pension payouts.
- India's growth trajectory has not been significantly impacted by demographic factors historically, but efforts to maximize productivity and create opportunities can change that.
- Technological and institutional innovations can ameliorate the effects of population aging.
- India has an opportunity to tap into China's worsening demographic and seize the moment, potentially surpassing Vietnam and Indonesia.
(Source: Hindustan Times)
### Summary
Commerce and Industry Minister Piyush Goyal believes that India will become the engine of global growth, with its economy projected to reach $35 trillion by 2047. India's young population and vibrant democracy are key factors contributing to its sustainable and inclusive growth.
### Facts
- India is expected to become the growth engine of the world, according to Commerce and Industry Minister Piyush Goyal.
- The country's GDP is projected to reach $35 trillion by 2047, offering significant business opportunities.
- With a population of 1.4 billion people, India recently surpassed China as the world's most populous country.
- India's young population, with over 600 million people aged between 18 and 35, is expected to continue for at least the next few decades.
- India is estimated to provide 24.3% of the incremental global workforce over the next decade.
- The country's digital economy has grown rapidly, with initiatives like the Aadhaar program and the Skill India program promoting digital literacy and skills development.
- India aims to create sustainable and inclusive growth, focusing on value creation and becoming a matter of pride and envy.
🇮🇳💼🌍📈🌱
India's economic growth likely accelerated to 7.7% in the April-June quarter, driven by strong service sector growth, high demand, and increased government capital expenditure, according to a Reuters poll.
India's economy is experiencing consistent growth, and is predicted to become the fourth-largest economy within 18 months and the third-largest by 2028, driven by strong fundamentals and infrastructure development, while successfully reducing poverty; however, further reforms in areas such as patents, judicial, administrative, and process reforms are needed to boost economic growth.
India's economy is facing challenges as GDP growth declines, investment demand weakens, inflation rises, and job creation remains a major concern, highlighting the need for a comprehensive economic plan to address these issues.
Tamil Nadu's economic growth has reached 8% in the post-COVID-19 years of 2021-22 and 2022-23, with the state's Gross State Domestic Product (GSDP) growing at constant prices, surpassing the national average.
India has seen an increase in its tariffs and trade policy measures in recent years, reversing the trend towards liberalization and increasing trade restrictions, which is a global phenomenon as many countries are adopting industrial policies to promote domestic production and exports; however, the effectiveness of these policies and their impact on economic growth and job creation remain to be seen.
India's low female labor-force participation rate is attributed to weak job creation and a conservative culture that confines women to the home, hindering progress despite recent small gains in the percentage of women in the workforce.
India's economy grew at its fastest pace in a year in the April-June quarter, driven by services and manufacturing, though economists warn of a slowdown ahead due to factors like rising food prices and slowing global growth.
India's recent achievements and economic growth have positioned it as a rising global power, but the country must address its challenges in poverty, job creation, education, and inequality in order to fully realize its potential.
The economist Tharman Shanmugaratnam highlights India's challenges in achieving sustained economic growth, addressing social and economic disparities, and integrating with China and ASEAN. He emphasizes the need for India to focus on education, increase exports, reform employment and land acquisition laws, and take advantage of its untapped potential.
India's GDP growth reached a four-quarter high of 7.8% in Q1FY24, with private consumption and services picking up pace, but challenges lie ahead with the sustainability of services growth and concerns over the monsoon and agriculture sector.
India's economic rise is seen as inevitable due to factors such as a consumer boom, context-appropriate innovation, a green transition, a demographic dividend, access to finance, major infrastructure upgrades, policy reforms, geopolitical positioning, and a diaspora dividend, although challenges such as unbalanced growth, unrealized demographic potential, and unrealized ease-of-business and innovation potential still need to be addressed.
The virtuous cycle of scale, innovation, and democracy in India is leading to more talent staying or returning to the country, which contributes to economic growth and strengthens the social contract, ultimately creating a promising future.
India's industrial output rose 5.7% in July, its fastest pace in five months, driven by strong mining and electricity activity, but high inflation and slowing pent-up demand may hinder future growth.
India's economic growth is estimated to be closer to 7.5%, with the country's first quarter growth at 7.8%, reflecting India's increasing stature in the world.
China's economy has entered deflation territory and the debt crisis has worsened, while India's economy is thriving with GDP growth expected to exceed 7% and unemployment rates at a 12-year low; it is predicted that India will surpass China in per capita income by 2044 due to factors such as female education expansion, labor force growth, and higher total factor productivity growth.
A survey by the National Council of Applied Economic Research reveals that food delivery workers in India are often the sole breadwinners in their families, experience a decline in income over time, and lack social security protection.
A study reveals that the recent increase in women's participation in India's labor force is mainly due to self-employment driven by distress rather than economic growth.
The Asian Development Bank has lowered India's GDP growth forecast for FY 2023-24 to 6.3% due to the impact of extreme rainfall patterns on agriculture, while maintaining a growth projection of 6.7% for FY 2024-25, citing corporate profitability and strong bank credit as key factors. Additionally, the bank expects inflation to moderate and retail sales to be affected by food inflation, while India's external trade is expected to be affected by weak global demand. Despite these challenges, India's GDP growth outlook remains higher compared to its Asian peers.
India is expected to be the fastest-growing major economy this fiscal year, but the forecasted growth is still below potential and risks are skewed to the downside, with a drier than normal monsoon season and sluggish private consumption acting as restraints; however, economists predict that the Reserve Bank of India will cut rates in the second quarter of next year.
India's labor force lags behind China's, with a labor force participation rate of only 51% compared to China's 76%, and India will need a participation rate of over 70% by 2030 to match China's labor force size, according to Oxford Economics; the country's low labor rate and productivity are attributed to inadequate education and health care standards.
India's GDP growth is expected to moderate over the next few quarters, with a projected growth rate of around 7% in the second quarter and a slowdown to around 4.5-5% in the second half of the year. Factors such as the fluctuating monsoon, lower reservoir levels, cautious rural demand, and the impact of monetary tightening are likely to contribute to this moderation in growth. The writer predicts a full-year GDP expansion of 6%, with future growth depending on factors such as the outcome of the next election.
India's unemployment rate dropped to a one-year low in September, with joblessness in rural areas falling despite weak monsoon rains, leading to the overall joblessness rate sliding to 7.09%.
India needs to increase women's participation in the workforce to 50% to achieve its goal of becoming a $5 trillion economy, according to the World Bank India director, Auguste Tano Kouamé. Increasing female labor force participation alone could add 1 percentage point to India's GDP growth.
The Indian economy grew 7.8% in the first quarter, leading to improved employment numbers and a decrease in the unemployment rate in urban areas. Female labor force participation also increased, but there is still a significant gender disparity in unemployment rates.
India's demographic shift towards an aging population poses a significant economic challenge and could hinder the realization of the country's demographic dividend, highlighting the need for sustained economic growth and capital investment to support the elderly and boost productivity.
Large established businesses in India experienced strong double-digit growth in their gross corporate income in FY21, more than compensating for the income drop faced by smaller companies, attributed to their well-established supply chains and logistic facilities as well as a quick recovery from the first wave of the pandemic.
