Economic Indices

India is blessed with practically all resources and in particular is a leading producer of mica, bauxite, silk, spices, coffee, other agricultural produces, ready made garments and engineering goods. Since time immemorial, it has also been the seat of education and spiritual studies. The desire to find a sea route to India during the 14th and 15th centuries was the main reason that led to the discovery of the American continents and the subsequent colonization of the world by the European nations. In recent times it has also shot into fame as the home of the finest software and computer engineers. While the economy is largely agrarian, it has an open and a free market economy with substantial participation from the government. Except for a few areas like defence production, atomic energy and space research etc, the other areas are open for private investments.

The Gross Domestic Product of the Indian Economy is in excess of USD 1.30 Trillion and is growing at an average of about 6% - 8% every year. From a centrally planned mixed economy, it opened up its economy from 1991 following the liberalisation programmes of the government then in power.

Geographically India’s mainland extends from 08o 04’ to 37o 06’entirely in the northern hemisphere while from west to east, it extends from 68o 07’ to 97o 25’ east of Prime meridian. In terms of distance it measures 3200 kms north to south and 3000 kms west to east, in all 32,74,600 square kilometers. In the west, north and east, it has land borders measuring approximately 15200 kms with Pakistan, Nepal, Bhutan, China, Bangladesh and Myanmar while the southern peninsula is surrounded by the Arabian Sea, Indian Ocean and the Bay of Bengal resulting in a coastline of approximately 5700 kms. Apart from this, two chain of islands known as Lakshadweep Isles in the west and the Andaman & Nicobar Isles in the east are also parts of India .The southern most tip of these islands called the Indira Point extends very much to the south of mainland. The Indian Standard Time (IST) is based on the mean local time at 82.50 deg east longitudes and is 5:30 hrs ahead of GMT.

Currency : The Indian currency is the Rupee, which is normally allowed to float freely in the forex market against a basket of currencies. The value ranges around 43 to 46 rupees to the US dollar. The Reserve Bank of India however plays an important role in keeping the rupee at the desired level by frequently intervening in the market by buying and selling of foreign currencies or through its fiscal and monetary policies.

Banking : The banking industry in India is highly developed. The nationalised banks, with the government of India as the majority shareholder handle the bulk of the banking services. These banks with a combined network of more than 70000 branches have taken banking to practically every village and hamlet of India by offering a variety of services and modes of financing to suit the needs of Indian industries. The normal facilities extended to industries are Term Loans for fixed assets, sanctioning overdraft, cash-credit, bill discounting and other Working Capital limits, export packing credit and indirect finance like Bank guarantees and Letters of Credits etc. There are also specialised financial Institutions for providing industrial credit. Even though most of the well-known multi national banking companies have commercial presence in India, their role in financing the industry and agricultural sectors has been negligible. They have generally limited their activities to large cities and mostly in maintaining ATM’s and issuing credit cards. Lately a few privately owned banks have shown signs of becoming big players in the market.

Insurance : The Insurance industry was opened up to private sector a few years back and has quite a number of players. While the private players have made a mark in life insurance business, the business consisting of marine, burglary, fire and other general insurance is still dominated by the four nationalised insurance companies. The insurance premia in India are among the lowest in the world.

Transportation & Communication : India has one of the largest postal and railway networks which operate efficiently and are also one of the cheapest service providers in the world. While the country is well connected by rail and air, road transport is considered somewhat below international standards. India has a coastline of 5700 kms and there are a number of ports like Kandla, Mumbai, Mangalore, Chennai, Paradeep, Vishakapattinam and Kolkata.

Industrialisation : While the population is still largely dependent on agriculture, manufacturing and service sectors are huge contributories to the economy as well. The states in the west and south like Gujarat, Maharashtra, Karnataka, Andhra Pradesh and Tamil Nadu are considered highly industrialised along with Punjab and surrounding areas of Delhi in the north. The north central states have developed mining industries.

Availability of factors of Production: Raw materials for almost all kinds of industries would be available locally while labour is not a problem. India has the largest pool of skilled and qualified engineers. Land is not available cheaply, unless one is prepared to go to the interiors, away from cities. Power supply is also not reliable and can be erratic.

Safety to life and property : Barring some militancy in the Border States like Jammu & Kashmir and a few terrorist attacks, India is by and large a peaceful and safe country. It maintains one of the largest armed forces in the world to defend the external borders and also subsidiary and paramilitary forces like the Coast Guards, Railway Protection Force, Industrial Security Forces etc, whose main duties are prevention of smuggling and narcotic trade and protection of economic and commercial assets.