“Businessing” with India
India is the fastest growing large economy in the world today – an impressive position it has held since it overtook China in the year 20151 – with the International Monetary Fund (IMF) predicting that India is likely to retain the status till 2020. With the Gross Domestic Product (GDP) of the country growing at more than 7% since 2014, the IMF has kept projections for India’s growth in 2016-2017 at 7.5%2, which is remarkable since there has been a forecast of the global growth predicted at 3.4% (2016)3. India is also the third-largest economy in the world regarding its purchasing power parity according to the World Bank with the GDP5 of over USD 2.1 trillion.5 It was named amongst the top 10 Foreign Direct Investment (FDI) destination in 2015.
The country is home to the 2nd largest English-speaking population in the world after the United States. It also has the largest youth population in the world at 650 million with more than half the population below 25 years of age. This demographic is arguably India’s greatest strength. As United Nation (UN) report stated, ‘developing countries with large youth populations could see their economies soar, provided they invest heavily in young people’s education and health and protect their rights.4
Furthermore, India’s smartphone users are numbered at over 220 million, making it the second-biggest smartphone market regarding active unique smartphone users, surpassing even the US market.6 From being the country having the 2nd largest pool of doctors and engineers, India is also making headway in media with over 100,000 registered publications and 800 television channels.
Looking at these statistics, one cannot deny that India has an incredible potential to rise as an economic power with a prosperous future. A decade-long study by Harvard University’s Centre for International Development predicts the country’s GDP will continue to expand at an average of over 7% which means nominal GDP will nearly double to around USD 4.50 trillion at current exchange rates in 2025. India’s purchasing power parity in 2025 will thus be around USD 15 trillion by a similar calculation. It is also set to be the 5th largest consumer market by the same year.7 “Never before have there been so many young people. Never again is there likely to be such potential for economic and social progress. How we meet the needs and aspirations of young people will define our common future.” mentions the UN report. Thus, it is crucial to make several reforms and introduce the right type of policies to maintain the current trajectory.