Indian Economic Review
By Dr Srimal Fernando, Correspondent South Asia
India is a dynamic and one of the most vibrant country's in the whole of Asia. India’s ongoing economic transformation has had a reflective impact not only on India but on the whole world. Since 1991, India has opened its economy and its exports continues to be a major driver of its rapid economic growth. India has sustained higher economic growth for the past 20 years. The country has become a favored destination for relocation of global manufacturing facilities. India's nominal GDP per capita income has steadily increased from U$329 in 1991to US$ 1,265 in 2010. Significant progress had been achieved in human and social development over the past six decades. The International Monetary Fund (IMF) projected that Indian economy will expand by 8.2 percent in 2011.
The Forbes Global 2000 listed 47 Indian companies in its ranking for 2009.The country has transformed progressively from a traditional agricultural society to a Newly Industrialized Country (NIC). Today, the country has brought about vast improvements in its dairy & milk production and communication systems. During the last three decades there has also been a remarkable improvement in the sphere of transport and communications. Development of Industries reduced the dependence of the economy on agriculture. Out of the 28 states in India, Gujarat, Tamil Nadu, Haryana, Punjab, Andhra Pradesh and Maha-rashtra are the rich states. The incomes of these middle income states are comparatively five times higher than the seven low-income states. The countries tremendous success in hosting the Asian Games, World Cricket, Hockey World Cups, Afro-Asian Games, South Asian Games and the 2010 Commonwealth Games has also helped to polish its image globally.
Gujarat, with an annual GDP growth of 9.6% (est 2008) is one of India's most prosperous and industrialized states in India. The state is a significant player in India’s economic growth. The state controls some of the largest businesses in the country. In Gujarat state the chemical production currently accounts for 41% of total State Domestic Production. Exports of garments and textiles are one of the main sources of foreign exchange incomes of Gujarat. Gujarat is also a major producer of natural gas in India. The state is the main producer of tobacco, cotton, and groundnuts in India. Cement, petrol and electrical engineering goods are the major industries of the state. Gujarat has a significant agricultural production within India. Gujarat is the only state with a surplus of electricity that sold power to 12 other States of India. Gujarat's State Domestic Product (SDP) had risen at an average growth rate of 14 % per annum in real terms (Est 2002). Gujarat is now one of the most important markets for Indian exports: Gujarat Global Investors' Summit held annually is a perfect platform for domestic and foreign investors to explore the opportunities of the state.
Uttar Pradesh is India’s most populous state and one of the largest producers and consumers of agricultural products. Uttar Pradesh is the second largest state-economy in India. The State's main endowments include its vast human resource base and rich fertile agricultural land. Uttar Pradesh (UP) has the basic attributes for successful agro based industries. Forty six percent (46%) of the state income comes from agriculture. UP has retained its pre-eminent position in the country as a state with a surplus of food. The state is home to approximately 2.3 million Small Scale industrial units in the country. Tourism sector of Uttar Pradesh which had an astounding success story is entering a new track with fresh dimensions. Geographic diversity of Uttar Pradesh gives the state a rich diversity to its wild life and to rich archaeological heritage sites.
Tamil Nadu has historically been an agricultural state and is a leading producer of agricultural products in India. The progress of the Tamil Nadu state has been noteworthy. Tamil Nadu still produces more crops and livestock than many other states of India because of intensive cultivation. The state is the largest producer of bananas. In terms of production, Tamil Nadu accounts for 10% in fruits and 6% of vegetables, in India .The state is one of the highly industrialized states in the country. Tamil Nadu has been a net exporter of software, leather tanning, telecommunication, electronics and automobile industry. Over many decades telecommunication giants like Nokia, Motorola, Samsung and Sony Ericsson has set up their South Asian manufacturing plants in the state of Tamil Nadu. The state economy has continued to boom in recent years due to Foreign Direct Investments.
India's tremendous success in hosting several international sporting events, such as the Common wealth Games, Asian Games, South Asian Games, Afro – Asian Games, Cricket and Hockey World Cups has also helped to burnish its image globally. India now boasts of a private sector business that is continuing to attract the interest of the foreigners.
As of June 2011, the Bombay Stock Exchange (BSE) listed 5,085 Indian companies .BSE is the oldest stock exchange in Asia and the 8th largest stock exchange in the world. For 2010, India ranked 134 out of 183 economies in World Banks “Ease of Doing Business". India enjoys historic ties with her neighboring South Asian countries and is a member of SAARC (South Asian Association for Regional Cooperation) and is a member of the five nation BRICS group (Brazil, Russia, India, China and South Africa). The cultural affinities between the people of India and South Africa continue to provide the bedrock for bilateral relations. India is now one of the most important markets for South African exports .India and South Africa have been engaged in an active program of bilateral cooperation since the mid-1990s. India had actively promoted trade with South Africa in recent years. India’s demand for energy is surging rapidly. India’s coal demand is projected to pick up significantly.
The growth of India-South Africa bilateral trade had doubled from $3.1 billion in 2005 to $7.7 billion in 2010. India has become the 6th largest trading partner to South Africa in the Asian region and is truly a unique destination with better investment climate that can lure South African investments.