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Indian economy expected to reach $6tn by 2020

Discussion in 'World Economy' started by Hashu, Mar 6, 2011.

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  1. Hashu

    Hashu Lieutenant SENIOR MEMBER

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    COIMBATORE: Former ISRO chairman and Planning Commission member K Kasturirangan today said if India sustains a nine per cent GDP growth then by 2020 its economy is expected to approach $ six trillion.

    Kasturirangan said that the size of Indian economy would expand close to $ 1.8 trillion in the next 2-3 years.

    "If the present expectations which are reasonable and realistic, fructify, India is poised to become a world power," he said.

    "If we maintain the present rate of growth of GDP at around nine per cent, by the end of the present decade, 2020, this economy is expected to approach $ six trillion, with per capita GDP crossing $ 4,500 from the present $ 1,500", Kasturirangan said in his Graduation Day address at Kumaraguru College of Technology here.

    "If all goes well," the economy could even grow to 9-10 $ trillion and per capita income could rise to in excess of $ 6,000 by 2025, he said.

    Talking about India's space programme, Kasturirangan said since its inception, the secret behind its success has been "team work".

    "India is globally recognised today as a significant space faring nation. This is the result of teamwork in facing several challenges squarely and maintaining focus on our goals," he said.

    In the case of India, the role of technology is important since we became independent from colonial rule only about six decades ago and the need for development on several fronts is acute, he said.
    'Indian economy expected to reach $6tn by 2020' - The Times of India
     
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  2. Welcome

    Welcome 2nd Lieutant FULL MEMBER

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  3. Guynextdoor

    Guynextdoor Lt. Colonel SENIOR MEMBER

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    ^^^^ you gotta use compounding formula.
     
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  4. Hashu

    Hashu Lieutenant SENIOR MEMBER

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    he did, it's 3.2 trillion dollars if india's economy grows 9% every year for the next 9 years!
     
  5. jagjitnatt

    jagjitnatt Major ELITE MEMBER

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    Yes, the calculation is wrong. Instead of 2020, the GDP would reach $ 6 trillion by end of 2025.
    By 2020, the GDP would be somewhere around $ 3.2 trillion.
     
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  6. Guynextdoor

    Guynextdoor Lt. Colonel SENIOR MEMBER

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    ^^^ I checked. at 9 percent it doubles every 8 years. Means we'll tough 3.2 in 2018 (end???).
     
  7. WARrior

    WARrior 2nd Lieutant FULL MEMBER

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    guyz......its talking bout 9% real growth.......also count inflation of 4%......

    so in nominal term we wud reach 6tn by 2020....

    what u guyz have calculated is the real growth unbalanced for currency which when adjusted wud give u PPP GDP.

    so current 1.5 tn nominal GDP will become 6 tn.
     
  8. Welcome

    Welcome 2nd Lieutant FULL MEMBER

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    ^^^ that's another point but normally we calculate GDP without inflation...
     
  9. Bangalorean

    Bangalorean Lieutenant FULL MEMBER

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    Yep - that's a very important point. Our actual growth rate is around 13% - so the nominal GDP will anyway become 6 trillion by that time. Which is equal to China's current GDP.

    In terms of PPP though, it becomes very interesting. Even if one takes into consideration that the PPP value will vary over this decade as the rupee becomes more expensive, and due to increased inflation, we can safely assume a 1:2 ratio in 2020. This means, the economy will be worth around 12 trillion in PPP terms by 2020, which is almost equal to the current US economy

    After all, it's not for nothing that India is called the rising star of Asia :cheers:
     
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  10. WARrior

    WARrior 2nd Lieutant FULL MEMBER

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    thats not nominal GDP....thats our PPP GDP which is adjusted to inflation and currency.
     
  11. WARrior

    WARrior 2nd Lieutant FULL MEMBER

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    no frnd : PPP to nominal ratio isnt constant. it all depends on ur exchange rate. with more exports, exchange rate will decrease......so i am not sure if 12 tn is a credible figure.
     
  12. Guynextdoor

    Guynextdoor Lt. Colonel SENIOR MEMBER

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    ^^^ I doubt it...Our PPP adjusted GDP on anaverage is about 4 times the nominal. So even today with a 1.5 T Nominal, we'll be having a 6T PPP GDP right?
     
  13. Hashu

    Hashu Lieutenant SENIOR MEMBER

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    india's PPP is most 6 trillion already! we are talking about norminal!
     
  14. Hashu

    Hashu Lieutenant SENIOR MEMBER

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    india's economy actually grew 17% but the falling rupee (soon it will not fall, once the trade surplus comes) and inflation brings it down to 9% (i am talking about the inflation of the rupee...not total inflation)
    India's per capita income to grow to Rs 54,527 in FY'11 - Rediff.com Business
     
  15. Bangalorean

    Bangalorean Lieutenant FULL MEMBER

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    Of course it isn't constant, that's why I have taken such a low ratio of 1:2 - currently it's more like 1:3.5. Which is why, even if one takes into consideration that the PPP value will vary over this decade as the rupee becomes more expensive, and due to increased inflation, we can safely assume a 1:2 ratio in 2020. It will not reduce more than this.

    If it were to stay constant at the current figure of 1:3.5, the PPP GDP will be almost 18 trillion by 2020!! :what: Reduce it to 1:2 for a more realistic estimate of around 11-12 trillion
     
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