nomy

Economy - overview: India's economy is a mixture of traditional
village farming, modern agriculture, handicrafts, a wide range of
modern industries, and a multitude of support services. A large share
of the population, perhaps as much as 40%, remains too poor to afford
an adequate diet. The policy in the 1980s of fueling economic growth
through high government expenditure proved unsustainable, however, and
in the wake of an international payments crisis in 1991 India has been
transforming its semi-socialist, insular economy into a more open,
market-oriented economy. Production, trade, and investment reforms
since 1991 have provided new opportunities for Indian businesspersons
and an estimated 200 million plus middle class consumers. New Delhi
has stimulated exports, attracted foreign investment, and revived
confidence in India's economic prospects. GDP growth exceeded 6% in
1995 and in 1996. Most of the country's external fundamentals -
including the current account balance and reserves (now about $19
billion) - are healthy. Even so, the Indian Government needs to
restore the early momentum of reform, especially by continuing
reductions in the extensive remaining government regulations. The
government will also have to deal with rising government expenditures
and higher debt servicing which could create a debt trap by the turn
of the century. Even if a series of weak coalition governments come to
power in the next few years and are unable to push reforms
aggressively, parts of the economy that have already benefited from
deregulation will continue to grow. Moreover, the country can build on
other strengths, including its diverse industrial base, large
scientific and technical pool, its well-developed legal system, and
its large middle class.

GDP: purchasing power parity - $1.538 trillion (1996 est.)

GDP - real growth rate: 6.5% (1996 est.)

GDP - per capita: purchasing power parity - $1,600 (1996 est.)

GDP - composition by sector:
agriculture: 30%
industry : 28%
services: 42% (1993/94)

Inflation rate - consumer price index: 10.3% (1995)

Labor force:
total: 370 million (1995 est.)
by occupation: agriculture 65% or more, services 4%, manufacturing and
construction 3%, communications and transport 3%

Unemployment rate: NA%

Budget:
revenues: $34 billion
expenditures: $52.3 billion, including capital expenditures of $NA
(FY95/96)

Industries: textiles, chemicals, food processing, steel,
transp