Indian GDP, Per Capita Income Decline in USD Terms in 2013-14

Advance estimates by Indian Central Statistical Office (CSO) indicate that India's GDP for year 2013-14 is $1.7 trillion, down 9% from $1.87 trillion reported for the previous financial year. However, Indian economy has grown from Rs. 100.2 trillion in 2012-13 to Rs. 105.4 trillion in 2013-14 in terms of local currency.

India-Pakistan Per Capita GDP 1990-2012 Source: World Bank

Source: Economist Magazine

CSO estimates India's economic growth rate in the current financial year at 4.9 per cent, a faster pace than in the previous year, mainly on an improved performance in the agriculture and allied sectors.

India's per capita income is estimated at Rs. 74,920 (US$ 1201) for the fiscal year ending on March 31, 2014, according to Indian media reports. It is up from Rs 68,757 in 2012-13 in Indian rupee terms, but down based on current USD exchange rates.

While India's growth has slowed a lot in recent years, the recent decline of Indian economy in USD terms is the result of  a sharp drop in the value of Indian currency against the US dollar. The Indian rupee has plummeted from 47.80 in 2012 to 54.30 in 2013 to  62.30 to a US dollar now.

The free fall of Indian rupee has dashed the hopes of many in India, including former finance minister and current President Pranab Mukherjee, who were boasting about a $2 trillion economy as early as 2012.

India is now among "The Fragile Five", a phrase first used by Morgan Stanley report last August amid an emerging-market rout caused by investors pulling out their money on speculation the Federal Reserve would soon reduce its bond purchases. That month, the Indonesian rupiah, South African rand and Brazilian real fell to the lowest levels in more than four years and the Turkish lira, like the Indian rupee, was at its weakest rate ever.

The continuing weakness of the Indian rupee and the slow growth of Indian economy are likely to help the electoral fortunes of the Indian Opposition led by the  Hindu Nationalist BJP leader Narendra Modi.

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