Economic trends
India is amongst the world's 10 largest economies. The average GNP growth rate was 9.4% in average over the period 2006-07. This growth rate dropped during the global recession, the crisis affected India by the increase of risk aversion, a withdrawal of foreign capital and the drop of global demand. However, India was a country that quickly got out of the crisis, its growth was stimulated by private consumption and by the state's expenditures. From 5.7% in 2009, the growth has jumped up and it is expected to reach 10% in 2010 according to the estimations.
The government has established as its priorities to continue the reforms that will allow to sustain the growth, to modernize the economic structure and to fight against poverty. Programs concerning jobs, health, education, infrastructures and rural communities have also been announced. The pursuit of a re-balance in public finance is also projected, the objective is to bring the deficit to 5.5% of the GDP.
India remains a poor country: the GDP per capita is low, almost 25% of the population still lives below the poverty line and the inequalities are very strong.
Main branches of industry
India is the world's fourth agricultural power. Agriculture contributes to about 20% of the GNP and employs close to two-thirds of the active population. The main agricultural products are: wheat, millet, rice, corn, sugar cane, tea, potatoes and cotton. India is also the second producer of cattle, third producer of sheep and fourth in fishing production.
Coal is the country's main energy source (India is the third largest world producer of coal). In the manufacturing industry, textile plays a predominant role. In terms of size, the chemical industry is the second largest industrial sector (12% of the GNP).
The services sector is the most dynamic part of the Indian economy. It contributes to more than half of its GDP, and it does not employ but a third of its active population. The software sector, which grows rapidly, is boosting the export of services and modernizing the Indian economy.
International trade
India was a protectionist state for a long time, but the country has become progressively more open to international trade. It has recently signed free trade agreements with South Korea and the ASEAN, and has entered into negotiations with several partners (EU, MERCOSUR, Australia, New Zealand, South Africa).
India recorded a high commercial deficit due to the price rise of raw materials which increased the import invoices. In regards of exports, they have recorded a lower progression during the last recent years due to the rise of the rupee in relation to the dollar (most of the exports are drawn up in dollars) and the decline of the global demand. During the economic crisis, exports dropped at a slower rhythm than imports, creating a reduction of the commercial deficit.
The main trade partners of India are the European Union, the United Arab Emirates, China and the United States.
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