Economic Growth in India

Economic Development in India

India has been proved as one of the strong , fast developing, vibrant , stable, dynamic and self reliant developing countries of the World. Even under the severe impact of the global meltdown , India has achieved more than seven percent growth rate in 2011-12 after having registered growth rates of over 8 percent for three successive years. Growth rate of per capita income during the British period (1860-1945) was 0.5 percent. From the bottom level of development India was able to achieve 8.9 percent during 1951-1981, 12 percent in 1981-2001 and achieved 10.9 growth rate in 2001-2006.

As per the Central Statistical Organization ( CSO) estimate Quarterly GDP at factor cost at constant (2004-2005) prices for Q1 of 2011-12 is estimated at ` 12,26,339 crore, as against `11,38,286 crore in Q1 of 2010-11, showing a growth rate of 7.7 per cent over the corresponding quarter of previous year. Economic planning, economic reforms, heavy investments in agriculture and industrial sectors, strong banking sector, working of large number of small scale industries, presence of large number of establishments , high rate of saving and investment , good infrastructure facilities , implementation of various rural development and social development schemes by the Central and State Governments are some of the important reasons for this faster economic growth.
GDP Growth rate
Year GDP Factor Cost
(2004-05 Prices)

(` in Crores) Growth rate
( %)
2004-2005 29,67,599
2005-2006 32,49,130 9.5
2006-2007 35,64,627 9.6
2007-2008 38,93,457 9.3
2008-2009 41,62,509 6.8
2009-2010 44,93,743 8.0
2010-2011 48,79,232 8.6
2011-12*
(Q1 Estimate) 12,26,339 7.7

Source: Economic Survey 2010-2011,* CSO Q1 estimate Aug.2011

Growth rate of different sectors

Sectors 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12*
Agriculture,Forestry&Fishing 4.2 5.8 (-)0.1 0.4 5.4 3.9
Mining & Quarrying 7.5 3.7 1.3 6.9 6.2 1.8
Manufacturing 14.3 10.3 4.2 8.8 8.8 7.2
Electricity,Gas & Water Supply 9.3 8.3 4.9 6.4 5.1 7.9
Construction 10.3 10.7 5.4 7.0 8.0 1.2
Trade,Hotels,Transport&
Communication 11.7 10.7 7.6 9.7 11.0 12.8
Financing,Insurance,Real Estate &
Business Services 14.0 11.9 12.5 9.2 10.6 9.1
Community, Social &
Personal Services 2.9 6.9 12.7 11.8 5.7 5.6
GDP at Factor Cost 9.6 9.3 6.8 8.0 8.6 7.7
Source: Economic Survey 2010-2011,* CSO Q1 estimate Aug.2011

The economic activities which registered significant growth in Q1 of 2011-12 over
Q1 of 2010-11 are ‘electricity, gas & water supply’ at 7.9 per cent, ‘trade, hotels,
transport and communication’ at 12.8 per cent, ‘financing, insurance, real estate and
business services’ at 9.1 per cent. The estimated growth rates in other economic activities
are: 7.2 per cent in ‘manufacturing’, 5.6 percent in ‘community, social and personal
services’, 3.9 percent in ‘agriculture, forestry & fishing’, 1.8 percent in ‘mining &
quarrying’ and 1.2 percent in ‘construction’ during this period.



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