Context

As India aims for its vision for a “developed India” by 2047, this article presents a comparison of economic growth story of India and China.

Overview of Indian GDP Growth Rate

• Real GDP of  India: India’s real GDP grew at a much slower rate by 5.8% in the 1990s and 6.3% in the 2000s. 
• Nominal GDP of India: At the end of 2010, India’s nominal GDP, at $1.7 trillion, was 5.2 times its 1990 level. Yet, its world ranking, in terms of economic size, had improved only marginally from No. 12 to No. 9.

India China GDP Comparision

• Widening of Gap: In 1990, China’s economy was just over 1.2 times India’s and it became 3.6 times and 5.3 times India’s in 2010 and 2022 respectively.
• Size of Chinese Economy: The 1990s and 2000s were China’s decades. The size of its economy in 2010, measured by nominal GDP, was already larger than that of the US in 1990.
• Growth Rate of India during 1990-2022: India has witnessed such a transformation with an average annual real GDP growth of 6% during 1990-2022.
• Growth Rate of China During Same period: China’s average of 8.9% over the same 33-year-period.
• Increase in Per Capita GDP of China: The Chinese story has been accompanied by an increase in per capita GDP from $348 (less than India’s $369) to $12,720 (far more than India’s $2,411) during this period. 

Conclusion

At current per capita GDP levels, India currently falls within the category of “lower-middle income” countries ($1,136 to $4,465) and China is classified as an “upper-middle income” country ($4,466 to $13,845). To reach the status of a developed country ($13,846 or higher), is a goal worth striving for.