Visualizing Indian Economy

Agriculture:

The agricultural sector in India operates at extremely low productivity and the need for reforms in this sector is imperative. Observe that despite a large fraction of the population involved in agriculture, the agricultural value addition to the economy has declined significantly and has stagnated at lower levels. What it needs now is a big push by the government. 

India also has excessively high usage of fertilizers, even diverging within its own local group of lower-middle-income countries. Even with increasing fertilizer usage, its cereal yields have not diverged. Thus, reckless consumption of fertilizer could have detrimental effects on soil productivity in the long run. Large fertilizer consumption has many determinants but one clearly visible here is a major fraction of un-irrigated land.

Climate Change:

This issue would be affecting individuals across borders. With great problems come great responsibilities to tackle them. But having said that, it's quite evident the wide disparities that exist in this area. It would be unfair to hold punish everyone for the wrong-doings of some, at least given we can target them clearly. The data shows that high-income countries and even some from middle-income groups have been reckless in the past with respect to emissions and should be penalized heavily than the poor one's.  

So, although per-capita emissions in India has been rising, its per-capita emissions are fifth relative to high-income countries while it's half relative to middle-income countries 

At the same time, per capita electricity consumption in India is, ninth relative to high-income countries while half relative to middle-income countries. 

Although heavy investments are made into renewables, however, owing to the large population and faster-increasing energy needs than investments into renewables, the share of renewables in output has stagnated. Maybe fusion reactors are the solution to India's clean energy problems.

Owing to the larger service sector, interestingly enough, India's energy efficiency is quite high. Energy intensity - the energy required to produce one unit of output, is even lower than that of the United States.

Economy:

On the economic front, the situation is slightly bleak. Growth rates are down, imports and exports have reduced though trade deficits remain low or slightly positive, gross savings have declined and debts slightly inflated. Although there's no significant decline in total debt service over past years, short-term debts and external debts are well in control along with some declines. Despite COVID, debt levels have been kept under limits possibly owing to all-time high levels of FDI,  indicating a positive outlook for India.

Over the years, inflation has been well within bounds. Recently, there's slight surge owing to international macroeconomic conditions. 

Coming back to the economic growth, the Agriculture sector witnesses a long term decline in value additions (as a fraction of GDP). This is possibly owing to the burgeoning (relatively) manufacturing and services sector. Having said that, over the past decade, the fraction of value addition from the agriculture sector has remained stable, with the increased contribution in recent years. 

The fraction of value-added from manufacturing and industry has also been declining over the past decade. Going into sub-segments of manufacturing, none of the sub-sectors from chemicals, medium-high end manufacturing, food and tobacco, textiles, machinery or transport equipment show any improvement. Unfortunately, this points towards potential failure of the Aatm-Nirbhar Bharat initiative. 

The low or declining fraction of value-added contributions to the GDP from agriculture and manufacturing could be owed to a sharp rise in service sector activities. The growth in value-additions for agriculture, manufacturing and industrial activities do not show any charm either. In fact, over the past years, the growth has been declining. Hence, it illustrates that whatever growth is being derived, it's from the services sector.

Education:

Interestingly, the fraction of GDP spend on education is at par with the standards adopted by China, which has shown tremendous progress in technologies and education levels. In fact, in early millennial, India's education expenditure (% of GDP) was twice that of China. Despite this, progress in India is extremely slow in terms of literacy (ground-level observation although literacy rates and school enrollment rates show a consistent rise). This could be due to two potential reasons, first, the difference in GDP size and second, the size of economic leakages. 

The unemployment rates paint an interesting picture. The rates follow a slightly declining trend overall. However, this trend is owed to the significant reduction in female unemployment levels, as unemployment levels for males have remained stagnated. Not only a greater fraction of females is becoming part of the labour force but on female unemployment rates, India has outperformed middle-income countries and even the world average.

Energy and Extractives:

Access to electricity follows a long term growth, with over 95% population having electrification. However, the picture is completed when we see the time to get the electricity. Merely having electric wires without electricity is no good. Over the past years, alongside electricity access, the time to get electricity has reduced to half. Further, energy import levels (as a fraction of energy use) continues to rise potentially due to high oil imports by India.

Financial Sector Development:

Over past years, domestic credit to the private sector hasn't shown any significant rise. Although early millennial showed sharp financial deepening but it slowed down in the previous decade. This was potentially due to sharp rise in NPA's. In past few years, NPA's have started to fall and subsequently, bank credit to private sector have started to rise. It is also clear that the bank capital to assets ratio have been following an increasing trend. 

Health:

Age dependency ratio, fertility rates, mortality rates and population growth rates have been declining. At the same time, life expectancy has been consistently rising. Unfortunately, undernorishment that had been declining have started to rise in the recent years.

Infrastructure:

Tremendous push is observed in infrastructure. Investment in water and sanitation with PPP, secure internet servers and air transport has risen several folds over past decade (ignoring COVID). Similarly, container port traffic and transport witnessed break in trend in 2014. Owing to COVID, transport investments have reduced.

Trade:

Merchandise trade, overall exports and imports (% of GDP) has decreased significantly. International tourism that had declined in the middle of previous decade, has gained back traction. Supply chain reforms and infrastructure expenditures have borne fruits as logistics performance index showed improvement.

Public Sector:

Tax revenue in India has reached highs over decades. As a result, net borrowing has been on a continuous decline. Government expenditure's (as fraction of GDP) has remained at more or less the same levels as before, and lower than several peaks that India had observed in last 2 decades. Amongst expenditures, interest expenditures have been declining in the recent years while compensation to workers have stagnated. Interestingly, despite several disengagement of subsidies, transfers (% of expense) have been on all time highs.

Private Sector:

Tremendous improvement is visible for private sectors in the recent years. Time required to start a business has almost halved. Startup procedures required to register business has reduced significantly along with total tax rate for corporates (as % of profits). Hence, this might have lead to all time high number of registered businesses as well. Business procedures have also been made more transparent as observed by higher levels of business disclosure index.