Indian Economic Sector

The economy of India is large and diverse and is made up of a number of sectors, such as, agriculture, banking and finance, industries, services, textiles and handicrafts and so on. The economy of India is the twelfth largest in the world. Generally speaking, the reins of the Indian economy are in the hands of the government.

[caption id="attachment_647" align="alignright" width="354" caption="Composition of India's agricultural output in 2003-04"]Composition-of-indias-agricultural-output-in-2003-04[/caption]

Indian economic sector has some astounding figures to its credit. In 2001-02, the Indian economy grew by 5.4% and this was considered to be the highest growth rates in the world for that year. This overall growth rate was in fact brought about by 5.7% growth in agriculture, 3.3% in industry and 6.5% in the service sector.The service sector of India has seen an exponential growth in the recent past after globalization by exploiting its huge pool of human resources. India has become the hub of outsourcing activities for some of the major economies of the worlds such as the USA and the UK.

The agricultural sector had been the mainstay of Indian economy for long. But it accounts only about 20% of the GDP of India, currently, though it engages about 50% of the working population. Post independence, the agricultural sector of India has seen a steady rise with the use of modern scientific technologies like the widespread use of fertilizers, high-yield seeds and pesticides.

The financial and banking sector has experienced a rapid growth to support the fast paced Indian economic sector. India has now a wide and sophisticated banking network and hoards of national and state level financial institutions apart from a well established stock market comprising 23 stock exchanges and over 9000 listed companies. The IT sector has been a major contributor to the growth of the Indian economy. IT and IT enabled services have seen rapid expansion due to the modest availability of the number of highly qualified IT professionals. The annual growth of the software sector in the last decade exceeded 50%.

Growth rates in some of the Indian sectors have been projected to increase rapidly in the coming years. Such sectors are namely, manufacturing, pharmaceuticals, biotechnology, tourism, retailing, telecommunications, aviation and a few more. The road transport and telecommunications sectors of the Indian economy have also seen various effective measures taken by the government. Rapid progress in these sectors is encouraging the influx of foreign investors to India.

India is the world’s fourth largest economy in terms of purchasing power parity (PPP). The GDP of India is around US $4.042 trillion. One major challenge before the economy of India has been to remove economic inequalities. Poverty and rapid population growth are some other areas where India needs to focus upon to speed up the economic growth process.