That seems to be the attitude in 2011. Which worries us at EconomyWatch.com, because we do not believe that the underlying problems have been solved. If anything, they have been exacerbated.
But first, the numbers, taken as ever from our Economic Statistics Database.
World Economic Statistics at a Glance - 2011 Forecast
World GDP (PPP): $78.092 trillion
GDP Growth Rate: 3.3%
GDP Per Capita (PPP): $11,100
GDP By Sector: Services 63.4%, Industry 30.8%, Agriculture 5.8%
Growth In Trade Volume: 6.953%
Industrial Production Growth Rate: 4.6%
Population: 6.768 billion
Population Growth Rate: 1.133%
Urban Population: 50.5%
Urbanization Rate: 1.85% (125 million people move to cities every year)
The Poor (Income below $2 per day): Approx 3.25 billion (~ 50%)
Millionaires: Approx 10 million (~ 0.15%)
Labor Force: 3.232 billion
Inflation Rate - Developed Countries: 2.5%
Inflation Rate - Developing Countries: 5.6%
Unemployment Rate: 8.8%
Investment: 23.4% of GDP
Public Debt: 58.3% of GDP
Market Value of Publicly Traded Companies: $48.85 trillion, or 62.6% of World GDP
Sources: EconomyWatch.com Economic Statistics Database, CIA World Factbook, IMF, World Bank
The World Economy in 2010 was worth $74.007 trillion in GDP terms, using the Purchasing Price Parity (PPP) method of valuation. This is expected to grow to $78.092 trillion in 2011.
The overall global economy averaged a 3.2 per cent growth rate between 2000 and 2007, suffering a slight dip in 2001 - 2002 thanks to the Dot Com Crash, but continuing to grow throughout that period. In fact 2004 - 2007 were boom years. The Emerging Markets, led by the giants of China, India, Russia and Brazil (the BRIC countries) had been posting 7 per cent - 10 per cent growth rates for years. Property and stock market booms had brought consistent growth in North America and Europe. Investment was bringing economic development to much of the Middle East and Africa, and even Japan was recovering from its deflationary 'Lost Years'.
Economic conditions within these countries play a major role in setting the economic atmosphere of less well-to-do nations and their economies. In many aspects, developing and less developed economies depend on the developed countries for their economic wellbeing.
Theories were even circulating that thanks to the growth of the developing world, we might enjoy years of unfettered growth, as new markets would go through successive growth spurts and counter the effects of slowing growth elsewhere. It was suggested that Asia was 'decoupling' from the US and able to grow under its own steam thanks to its two 'Awakening Giants'.
Sadly, that turned out to be hogwash, as deregulation allowed western banks to build up unsustainable levels of debt that brought the global economy to the brink of depression.
As the 'Sub-Prime' Crisis morphed into a fully fledged crash then global Financial Crisis, 2008 started to bomb and 2009 became the first year that the world recorded a loss in GDP since World War II. 2.031% was wiped out of the global economy - or $3.3 trillion of value.
Sunday, September 25, 2011
Indian Agriculture
Indian Agriculture is one of the most important sector in the economy of the country. Agriculture in itself produces more than 18.5 percent of the Gross Domestic product of the country and more than 60 percent people out of Indian population are involved in this sector.
The Indian Agriculture also provides more than 8.5 percent of the total exportation of the Indian Economy. Indian Economy is becoming more and more dependent upon service sector and industrial sector, the Indian Agriculture still plays a vital role in the development of the Indian Economy.
The Monsoon also has a very important part in the Indian Agriculture. Because of the shortage of irrigation system in Indian Agriculture most of the farmers depend highly on rain falls. The amount of raining determines the nature of the crops and also the production. Indian Agriculture in the majority of state are looked after by the State Governments rater than Central Government.
Indian Agricultural Production
India is known to be the largest producer of milk and milk products, coconuts, cashew nuts, tea and other crops. Indian Agriculture after India has the largest out put in farming and it also comes second in producing crops like rice, wheat, rice and some other crops as well. In producing fruits like Banana and Sapota, Indian Agriculture is ranked one in the world
There are some factors that stops India from producing more crops in their fields:
•The farmers does not have enough land for themselves due to various reasons and the lands are also getting fragmented due to the ceiling acts and also due to family disputes.
•Illiteracy and the backwardness in the socio economic sphere also are responsible in stopping Indian Agriculture form growing more agricultural products.
•The use of technology is also not enough and unlike China, the farmers of India are not comfortable in using various agricultural technologies.
•The Indian Farmers are very much dependent on rain falls as there is not enough facility available for irrigation in most part of the country. So whether the crops would be good or bad depends entirely on the amount of rainfall in the country.
The Indian Agriculture also provides more than 8.5 percent of the total exportation of the Indian Economy. Indian Economy is becoming more and more dependent upon service sector and industrial sector, the Indian Agriculture still plays a vital role in the development of the Indian Economy.
The Monsoon also has a very important part in the Indian Agriculture. Because of the shortage of irrigation system in Indian Agriculture most of the farmers depend highly on rain falls. The amount of raining determines the nature of the crops and also the production. Indian Agriculture in the majority of state are looked after by the State Governments rater than Central Government.
Indian Agricultural Production
India is known to be the largest producer of milk and milk products, coconuts, cashew nuts, tea and other crops. Indian Agriculture after India has the largest out put in farming and it also comes second in producing crops like rice, wheat, rice and some other crops as well. In producing fruits like Banana and Sapota, Indian Agriculture is ranked one in the world
There are some factors that stops India from producing more crops in their fields:
•The farmers does not have enough land for themselves due to various reasons and the lands are also getting fragmented due to the ceiling acts and also due to family disputes.
•Illiteracy and the backwardness in the socio economic sphere also are responsible in stopping Indian Agriculture form growing more agricultural products.
•The use of technology is also not enough and unlike China, the farmers of India are not comfortable in using various agricultural technologies.
•The Indian Farmers are very much dependent on rain falls as there is not enough facility available for irrigation in most part of the country. So whether the crops would be good or bad depends entirely on the amount of rainfall in the country.
Understanding India's Foreign Trade Policy
Although India has steadily opened up its economy, its tariffs continue to be high when compared with other countries, and its investment norms are still restrictive. This leads some to see India as a ‘rapid globalizer’ while others still see it as a ‘highly protectionist’ economy.
Till the early 1990s, India was a closed economy: average tariffs exceeded 200 percent, quantitative restrictions on importswere extensive, and there were stringent restrictions on foreign investment. The country began to cautiously reform in the 1990s, liberalizing only under conditions of extreme necessity.
Since that time, trade reforms have produced remarkable results. India’s trade to GDP ratio has increased from 15 percent to 35 percent of GDPbetween 1990 and 2005, and the economy is now among the fastest growing in the world.
Average non-agricultural tariffs have fallen below 15 percent, quantitative restrictions on imports have been eliminated, and foreign investments norms have been relaxed for a number of sectors.
India however retains its right to protect when need arises. Agricultural tariffs average between 30-40 percent, anti-dumping measures have been liberally used to protect trade, and the country is among the few in the world that continue to ban foreign investment in retail trade. Although this policy has been somewhat relaxed recently, it remains considerably restrictive.
Nonetheless, in recent years, the government’s stand on trade and investment policy has displayed a marked shift from protecting ‘producers’ to benefiting ‘consumers’. This is reflected in its ForeignTrade Policy for 2004/09 which states that, "For India to become a major player in world trade ...we have also to facilitate those imports which are required to stimulate our economy."
India is now aggressively pushing for a more liberal global trade regime, especially in services. It has assumed a leadership role among developing nations in global trade negotiations, and played a critical part in the Doha negotiations.
Till the early 1990s, India was a closed economy: average tariffs exceeded 200 percent, quantitative restrictions on importswere extensive, and there were stringent restrictions on foreign investment. The country began to cautiously reform in the 1990s, liberalizing only under conditions of extreme necessity.
Since that time, trade reforms have produced remarkable results. India’s trade to GDP ratio has increased from 15 percent to 35 percent of GDPbetween 1990 and 2005, and the economy is now among the fastest growing in the world.
Average non-agricultural tariffs have fallen below 15 percent, quantitative restrictions on imports have been eliminated, and foreign investments norms have been relaxed for a number of sectors.
India however retains its right to protect when need arises. Agricultural tariffs average between 30-40 percent, anti-dumping measures have been liberally used to protect trade, and the country is among the few in the world that continue to ban foreign investment in retail trade. Although this policy has been somewhat relaxed recently, it remains considerably restrictive.
Nonetheless, in recent years, the government’s stand on trade and investment policy has displayed a marked shift from protecting ‘producers’ to benefiting ‘consumers’. This is reflected in its ForeignTrade Policy for 2004/09 which states that, "For India to become a major player in world trade ...we have also to facilitate those imports which are required to stimulate our economy."
India is now aggressively pushing for a more liberal global trade regime, especially in services. It has assumed a leadership role among developing nations in global trade negotiations, and played a critical part in the Doha negotiations.
US Economic Relations with India
Trade and commerce have been at the center of the US economic relations with India. There has been steady increase in this department. During 1990 the financial volume of the bilateral trade between the two countries had been 5.6 billion dollars. During the year 2004 the figure stood at 21.68 billion dollars, which was an improvement by 387%. In 2003 India had exported goods and services worth 13.05 billion United States dollars to the USA. In the next year there was a growth of 19.28% in the worth of goods exported to USA and the amount stood at 15.57 billion US dollars.
The United States exported goods worth 4.98 billion dollars to India in the year 2003 and in the next year the total worth of the goods exported to India by the US was 6.11 billion dollars. This was an addition of 22.69%. As per the information provided by the U.S. Department of Commerce, India exported merchandise worth 9737 million US dollars to US and the US exported merchandise worth 3757 million US dollars. In 2002 the US exported goods worth 4101 million US dollars and India exported goods worth 11818 million US dollars. In 2003 India exported merchandise worth 13055 million US dollars to the United States and the US exported 4980 million US dollars.
In 2004 the total worth of the merchandise exported by the United States to India was 6109 million US dollars and for India the amount stood at 15572 million US dollars. From the months of January to August in 2005 India had exported merchandise worth 5210 million US dollars and India had exported 12002 million US dollars worth merchandise to the US.
Over the years there have been certain goods that have been exported more often by India to US and the same is also true of the opposite. As far as India are concerned, the goods at the frontline are cut and polished diamonds as well as jewelry. Automobiles and parts, textile, organic chemicals and engineering equipments have also been occupying important positions in this context. In 2005 diamonds and precious stones were the leaders with 29% of the total goods exported. Textiles came second with 25% and iron and steel were third with 5.73%. Organic chemicals were 3.46% of the total exports made and electric machinery fifth with 3.24%.
In case of the US exports to India engineering equipments, optical and medical equipments, precious stones and metals, aircraft and other aviation equipments and organic chemicals have been the traditional ones. In 2005 the engineering equipments amounted to 30.20% of the total goods exported to India and precious stones and metals were second with 9.25%. Organic chemicals accounted for 7% of the total goods exported at that time like optical equipments. Aviation and aircraft accounted for 10.4% of the entire export of US to India
The United States exported goods worth 4.98 billion dollars to India in the year 2003 and in the next year the total worth of the goods exported to India by the US was 6.11 billion dollars. This was an addition of 22.69%. As per the information provided by the U.S. Department of Commerce, India exported merchandise worth 9737 million US dollars to US and the US exported merchandise worth 3757 million US dollars. In 2002 the US exported goods worth 4101 million US dollars and India exported goods worth 11818 million US dollars. In 2003 India exported merchandise worth 13055 million US dollars to the United States and the US exported 4980 million US dollars.
In 2004 the total worth of the merchandise exported by the United States to India was 6109 million US dollars and for India the amount stood at 15572 million US dollars. From the months of January to August in 2005 India had exported merchandise worth 5210 million US dollars and India had exported 12002 million US dollars worth merchandise to the US.
Over the years there have been certain goods that have been exported more often by India to US and the same is also true of the opposite. As far as India are concerned, the goods at the frontline are cut and polished diamonds as well as jewelry. Automobiles and parts, textile, organic chemicals and engineering equipments have also been occupying important positions in this context. In 2005 diamonds and precious stones were the leaders with 29% of the total goods exported. Textiles came second with 25% and iron and steel were third with 5.73%. Organic chemicals were 3.46% of the total exports made and electric machinery fifth with 3.24%.
In case of the US exports to India engineering equipments, optical and medical equipments, precious stones and metals, aircraft and other aviation equipments and organic chemicals have been the traditional ones. In 2005 the engineering equipments amounted to 30.20% of the total goods exported to India and precious stones and metals were second with 9.25%. Organic chemicals accounted for 7% of the total goods exported at that time like optical equipments. Aviation and aircraft accounted for 10.4% of the entire export of US to India
Indian Economy
India is a South Asian country that is the seventh largest in area and has the second largest population in the world. India covers an area of 3,287,240 square km (India geography) and its population stands at 1.215 billion people in 2010 (India population) . India has great plains, long coastlines and majestic mountains. Thus, the land has abundant resources. India shares its borders with China, Bangladesh, Pakistan, Nepal, Sri Lanka and Myanmar.
Understanding the Indian Economy
Large, dynamic and steadily expanding, the Indian economy is characterized by a huge workforce operating in many new sectors of opportunity.
The Indian economy is one of the fastest growing economies and is the 12th largest in terms of the market exchange rate at $1,430.02 billion (2010 India GDP). In terms ofpurchasing power parity, the Indian economy ranks the fourth largest in the world. However, poverty still remains a major concern besides disparity in income.
The Indian economy has been propelled by the liberalization policies that have been instrumental in boosting demand as well as trade volume. The growth rate has averaged around 7% since 1997 and India was able to keep its economy growing at a healthy rate even during the 2007-2009 recession, managing a 9.668 % growth rate in 2010 (India GDP Growth). The biggest boon to the economy has come in the shape of outsourcing. Its English speaking population has been instrumental in making India a preferred destination for information technology products as well as business process outsourcing.
The economy of India is as diverse as it is large, with a number of major sectors including manufacturing industries, agriculture, textiles and handicrafts, and services. Agriculture is a major component of the Indian economy, as over 66% of the Indian population earns its livelihood from this area.
However, the service sector is greatly expanding and has started to assume an increasingly important role. The fact that the Indian speaking population in India is growing by the day means that India has become a hub of outsourcing activities for some of the major economies of the world including the United Kingdom and the United States. Outsourcing to India has been primarily in the areas of technical support and customer services.
Other areas where India is expected to make progress include manufacturing, construction of ships, pharmaceuticals, aviation, biotechnology, tourism, nanotechnology, retailing and telecommunications. Growth rates in these sectors are expected to increase dramatically.
Despite the liberalization the economy still largely controlled by the government and the 500+ major companies it owns, which together are worth around US$500 billion, or around 40% of GDP at current exchange rates. Thanks to past profligate spending, government debt is running at around 80% of GDP. Servicing the interest payments on that debt is now the single largest component of the federal budget. Fiscal discipline and deficit reduction is therefore vital for India's future prospects.
It is also crucial to understand that India is driven primarily by domestic (consumer) consumption. This stands in marked contrast to Japan, the Asian Tigers and now China, all of whom have followed the export-oriented model.
With the massive growth of the Indian middle class, this vast country may become Asia's first major 'buy' economy.
Understanding the Indian Economy
Large, dynamic and steadily expanding, the Indian economy is characterized by a huge workforce operating in many new sectors of opportunity.
The Indian economy is one of the fastest growing economies and is the 12th largest in terms of the market exchange rate at $1,430.02 billion (2010 India GDP). In terms ofpurchasing power parity, the Indian economy ranks the fourth largest in the world. However, poverty still remains a major concern besides disparity in income.
The Indian economy has been propelled by the liberalization policies that have been instrumental in boosting demand as well as trade volume. The growth rate has averaged around 7% since 1997 and India was able to keep its economy growing at a healthy rate even during the 2007-2009 recession, managing a 9.668 % growth rate in 2010 (India GDP Growth). The biggest boon to the economy has come in the shape of outsourcing. Its English speaking population has been instrumental in making India a preferred destination for information technology products as well as business process outsourcing.
The economy of India is as diverse as it is large, with a number of major sectors including manufacturing industries, agriculture, textiles and handicrafts, and services. Agriculture is a major component of the Indian economy, as over 66% of the Indian population earns its livelihood from this area.
However, the service sector is greatly expanding and has started to assume an increasingly important role. The fact that the Indian speaking population in India is growing by the day means that India has become a hub of outsourcing activities for some of the major economies of the world including the United Kingdom and the United States. Outsourcing to India has been primarily in the areas of technical support and customer services.
Other areas where India is expected to make progress include manufacturing, construction of ships, pharmaceuticals, aviation, biotechnology, tourism, nanotechnology, retailing and telecommunications. Growth rates in these sectors are expected to increase dramatically.
Despite the liberalization the economy still largely controlled by the government and the 500+ major companies it owns, which together are worth around US$500 billion, or around 40% of GDP at current exchange rates. Thanks to past profligate spending, government debt is running at around 80% of GDP. Servicing the interest payments on that debt is now the single largest component of the federal budget. Fiscal discipline and deficit reduction is therefore vital for India's future prospects.
It is also crucial to understand that India is driven primarily by domestic (consumer) consumption. This stands in marked contrast to Japan, the Asian Tigers and now China, all of whom have followed the export-oriented model.
With the massive growth of the Indian middle class, this vast country may become Asia's first major 'buy' economy.
China Trade, Imports and Exports
As part of China's continuing effort to become competitive in the global marketplace, China joined the World Trade Organization in 2001. China's entry into the WTO has benefited coastal cities, especially in the southeast. Although a British crown colony until its return to Chinese control in 1997, Hong Kong has long been a major maritime outlet of South China.
China Exports
In 2010, China exports totaled $1.194 trillion, down from $1.429 trillion in 2008. It’s main exports are electrical goods and other machinery, including data processing equipment, apparel, textiles, iron and steel, optical and medical equipment;
China's main export partners are US (17.7%), Hong Kong (13.3%), Japan (8.1%), South Korea (5.2%) and Germany (4.1%)
China Imports
In 2010, China imports totaled $921.5 billion, down from $1.131 trillion in 2008. It’s main imports are electrical components and other machinery, oil and mineral fuels, optical and medical equipment, metal ores, plastics and organic chemicals;
China's main import partners are Japan (13.3%), South Korea (9.9%), US (7.2%) and Germany (4.9%).
CHALLENGES FACING CHINA
In the early 21st century, China faced the challenge of balancing its highly centralized political system with an increasingly decentralized economic system.
Also, China's economy, though strengthened by liberal economic policies of the 1980s and 90s, continues to suffer from inadequate transportation, communication, and energy resources. However, since the 1980s, China has undertaken a major highway construction program and China is working hard on building world-class infrastructure.
China's poor human development index highlights the economic disparity between urban China and the rural hinterlands. Human rights campaigners continue to criticize China for executing hundreds of people every year and for failing to stop torture.
Other critical problems include corruption, which affects every level of society, and the growing rate of HIV infection. Tensions between a highly centralized political - and an increasingly de-centralized economic system is also a cause of tension.
Another long term threat to China's continued economic growth is the deterioration in the environment, notably air pollution, soil erosion and the steady fall of its water table in the north.
China Exports
In 2010, China exports totaled $1.194 trillion, down from $1.429 trillion in 2008. It’s main exports are electrical goods and other machinery, including data processing equipment, apparel, textiles, iron and steel, optical and medical equipment;
China's main export partners are US (17.7%), Hong Kong (13.3%), Japan (8.1%), South Korea (5.2%) and Germany (4.1%)
China Imports
In 2010, China imports totaled $921.5 billion, down from $1.131 trillion in 2008. It’s main imports are electrical components and other machinery, oil and mineral fuels, optical and medical equipment, metal ores, plastics and organic chemicals;
China's main import partners are Japan (13.3%), South Korea (9.9%), US (7.2%) and Germany (4.9%).
CHALLENGES FACING CHINA
In the early 21st century, China faced the challenge of balancing its highly centralized political system with an increasingly decentralized economic system.
Also, China's economy, though strengthened by liberal economic policies of the 1980s and 90s, continues to suffer from inadequate transportation, communication, and energy resources. However, since the 1980s, China has undertaken a major highway construction program and China is working hard on building world-class infrastructure.
China's poor human development index highlights the economic disparity between urban China and the rural hinterlands. Human rights campaigners continue to criticize China for executing hundreds of people every year and for failing to stop torture.
Other critical problems include corruption, which affects every level of society, and the growing rate of HIV infection. Tensions between a highly centralized political - and an increasingly de-centralized economic system is also a cause of tension.
Another long term threat to China's continued economic growth is the deterioration in the environment, notably air pollution, soil erosion and the steady fall of its water table in the north.
Economic Relationship among SAARC Nations
The South Asian Association for Regional Cooperation or SAARC was created to promote economic integrity and cooperation among 7 South Asian nations namely India, Bangladesh, Pakistan, Bhutan, Nepal, Maldives, and Sri Lanka. The Association was formed in 1985 with the aim to ensure social and economic development of the member countries. However, over the years it has been seen that SAARC mainly worked towards development of economic relationship among the SAARC nations. Attempts are also on to further trade relations with the member nations of ASEAN (Association of South East Asian Nations) and the European Union.
In spite of lying in the vicinity of one another, trading activities were restricted among the SAARC nations. Over the years, there has significant improvement in the trade relations among the seven SAARC members. The focus has been shifted to get access to the markets of the other members. Methods have also been devised to attract foreign direct investments to strengthen economic infrastructures of the SAARC nations. All these initiatives point towards an improvement in the economic relationship among the 7 South Asian countries.
Despite the sincere attempts of the Association, there are several factors that stand in the way of economic integrity among the SAARC nations. The clashes between India and the neighboring countries have prevented the SAARC members to make the most of the economic benefits derived from the Association. This has prompted the South Asian countries to go for bilateral trading activities instead of getting involved in multilateral trade agreements. However, the Association is expected to take more proactive steps to improve the economic relationship among its members. Besides devising policies for economic integration, SAARC is supposed to function as a medium to facilitate discussions among the South Asian nations. Seminars and conferences are going to be helpful measures for promoting cross border trade and investment.
As an aftermath of globalization, Indian government has resorted to open trade policy. The economic reforms of early 1990s have opened an array of challenges for the Indian entrepreneurs. The growth rate of the Indian economy was around 7% during the period from 1994-1997. The inflow of foreign fund also recorded substantial increase.
All these resulted from the flexible economic policies adopted by the Indian government. The economic prosperity of India prompted the other SAARC members to seek resort to international trade as a platform for economic growth. Both Sri Lanka and Nepal have shown their interests to enhance intra regional trade. Bangladesh is also following the same trend. With the increased intra regional trading activities, the economic relationship among the SAARC nations is bound to be stronger in future.
In spite of lying in the vicinity of one another, trading activities were restricted among the SAARC nations. Over the years, there has significant improvement in the trade relations among the seven SAARC members. The focus has been shifted to get access to the markets of the other members. Methods have also been devised to attract foreign direct investments to strengthen economic infrastructures of the SAARC nations. All these initiatives point towards an improvement in the economic relationship among the 7 South Asian countries.
Despite the sincere attempts of the Association, there are several factors that stand in the way of economic integrity among the SAARC nations. The clashes between India and the neighboring countries have prevented the SAARC members to make the most of the economic benefits derived from the Association. This has prompted the South Asian countries to go for bilateral trading activities instead of getting involved in multilateral trade agreements. However, the Association is expected to take more proactive steps to improve the economic relationship among its members. Besides devising policies for economic integration, SAARC is supposed to function as a medium to facilitate discussions among the South Asian nations. Seminars and conferences are going to be helpful measures for promoting cross border trade and investment.
As an aftermath of globalization, Indian government has resorted to open trade policy. The economic reforms of early 1990s have opened an array of challenges for the Indian entrepreneurs. The growth rate of the Indian economy was around 7% during the period from 1994-1997. The inflow of foreign fund also recorded substantial increase.
All these resulted from the flexible economic policies adopted by the Indian government. The economic prosperity of India prompted the other SAARC members to seek resort to international trade as a platform for economic growth. Both Sri Lanka and Nepal have shown their interests to enhance intra regional trade. Bangladesh is also following the same trend. With the increased intra regional trading activities, the economic relationship among the SAARC nations is bound to be stronger in future.
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