Growth and Structural Changes in India

Growth of National Income and Per Capita Income

India's economy has demonstrated significant growth over recent years. In 2022-23, the real GDP grew by
7.0%, compared to a 9.7% growth in 2021-22. Nominal GDP for 2022-23 was estimated at ₹270 lakh crore,
showing a growth of 14.2% from ₹235 lakh crore in the previous year . For 2023-24, projections estimate a
real GDP growth of 7.3%, with nominal GDP expected to reach approx ₹296 lakh crore (Press Information
Bureau).

India's per capita income has seen a significant rise in recent years. Here are the latest figures:

 2022-23: The per capita net national income (NNI) at current prices was ₹172,000, This marks a
substantial increase from previous years, reflecting ongoing economic growth despite challenges
such as the COVID-19 pandemic.
 2023-24: Projections indicate further growth, with the per capita income estimated to reach
₹183,236 (Press Information Bureau)
SECTORAL REFORMS IN INDIA
The different sectors have been grouped under three heads, namely, Agriculture and allied activities,
Industry, and services.
PRE
Agriculture has been a way of life and continuous to be the single most important livelihood of the masses.
Agriculture was a dominant sector, but plagued by low productivity, small landholdings, zamindari system,
traditional farming methods, lack of modern technology, inadequate infrastructure which hindered
postharvest management and market access.
Industry
Government controls, licensing requirements, and bureaucratic red tape supressed entrepreneurship and
innovation. Private sector involvement was restricted, and heavy reliance was placed on state-owned
enterprises which resulted in inefficiencies, lack of competition, and suboptimal resource allocation.
Services
Service sector primarily comprised traditional services such as retail, transportation. Limited Innovation and
technology adoption and inadequate infrastructure, particularly in areas like banking, telecommunications,
and education, constrained the expansion of modern services.
REFORMS INTRODUCED
AGRICULTURE

 Market Liberalization: Introduction of initiatives like the Agricultural Produce Market Committee
(APMC) Act aimed to reduce barriers to interstate trade and promote a more competitive
agricultural market.
 Encouraging Private Investment: for cold storage facilities, warehouses, and food processing units.
 Improving Infrastructure: Investments were made to improve irrigation facilities, rural roads, and
market linkages to enhance farm productivity and reduce postharvest losses.
 The growth rate of the primary sector, including agriculture, livestock, forestry, and fishing, was

4.4% in 2022-23, slightly down from 4.8% in the previous year (Press Information Bureau).
 Contributes 20.2 &% in the gva
INDUSTRY
 Many public sector enterprises (PSEs) were privatized or disinvested to reduce the government's
role in industries and improve efficiency.
 Removal of licensing requirements, reduction of bureaucratic hurdles, and simplification of
regulations aimed to encourage entrepreneurship and investment.
 Liberalization policies attracted foreign direct investment (FDI), bringing in capital and technology,
 Private sector were given autonomy and were called maharatnas and navraantans and miniratnas.
 The secondary sector's growth decline to 2.1% in 2022-23 from 12.7% in 2021-22 was primarily due
to supply chain disruptions caused by global economic uncertainties and the lingering impacts of
the COVID-19 pandemic, which affected manufacturing output. Additionally, higher input costs and
inflationary pressures contributed to the contraction in the manufacturing sector.
 Contributes 25.6% in gva
SERVICES
 The services sector experienced exponential growth, emerging as a key driver of India's economic
development. India became a global hub for information technology (IT) services, leveraging its
skilled workforce, cost competitiveness, and English proficiency.
 The tertiary sector, encompassing services like trade, hotels, transportation, and financial services,
grew robustly at 10.0% in 2022-23 compared to 9.2% in the previous year (Press Information
Bureau).
 Contributes 54.2 % in gva

Occupational Structure

There is some close relationship between economic development of an economy and the occupational
structure of the country. Occupations are broadly divided into three types: primary, secondary, and tertiary
activities.

SHIFT IN THE OCCUPATIONAL PATTERN

 From 2001 to 2023, primary sector employment decreased to approximately from 57.3% to 42.5%
This decline reflects ongoing migration of labour from agriculture to more productive sectors

 From 2001 to 2023, the secondary sector increased from17.6% to 26.3% of total employment, driven
by growth in manufacturing, construction, and utilities
 By 2023, the service sector employed approximately 31.2% of the workforce, reflecting significant
growth in industries such as IT, finance, and real estate
CHANGING TRENDS IN EMPLOYMENT GROWTH IN ORGANIZED SECTOR:

 The National Commission for Employment in the Unorganized Sector (NCEUS) distinguishes between
formal (organized) and informal (unorganized) employment.
 The organized sector, including public and private establishments with 10 or more employees, offers
higher wages, job security, and benefits whereas there is a lack of these services in unorganised secto
 Public sector jobs within this sector typically provide better wages and benefits compared to similar
private sector roles.
 Employment in the organized sector increased from 54.12 million in 1990 -2000 to 62.57 million in
2004-05.
  However, this increase was mainly due to the rise of informal workers in organized enterprises,
reflecting globalization's impact on employment formalization.

Demographic Features

 Literacy:
1. Pre-Independence: Education levels were generally low, particularly among women and
marginalized communities. The overall literacy rate in India at the time of independence was
estimated to be around 16%. This means that only a small portion of the population had basic
reading and writing skills. Access to quality education was limited, especially in rural areas.
2. Post Independence: Literacy rates in India have been steadily improving with the overall literacy
rate reaching about 77.7% in 2023. Male literacy stands at 84.7%, while female literacy is 70.3%

 Life Expectancy:
1. Pre-Independence: Life expectancy in India was relatively low, with many people not living
beyond the age of 40 or 50. High infant mortality rates also contributed to lower life expectancy.
This was mainly due to factors like limited Healthcare Infrastructure, poor hygine and sanitation
lack of access to clean drinking water, lack of proper sewage and disposal system
2. Post Independence: Life expectancy has also increased, reaching approximately 70 years for
men and 72 years for women as of recent estimates (Press Information Bureau).
 Urbanization:
1. Pre-Independence: India was primarily agrarian, with around 75% of the population residing in rural
areas and dependent on agriculture for livelihood.
2. Post Independence: Urbanization is progressing, with an increasing proportion of the population
living in urban areas. As of the 2021 Census, about 34.5% of India's population resided in urban
areas, reflecting a steady rise from previous decades (Press Information Bureau).
 Population Growth:
1. Pre-Independence: India's population growth rate was relatively slow, with an estimated population
of around 300 million in 1947.
2. Post-Independence: India's population has witnessed a dramatic increase, crossing the billion mark
in the late 20th century. As of recent times, it continues to be one of the most populous countries in
the world, with over 1.3 billion people

 Birth and Death Rates:

 Pre-Independence: Birth rates were high, largely due to cultural norms, lack of awareness
about contraception, and the agrarian nature of the economy. Death rates were also
relatively high due to factors like limited access to healthcare and widespread diseases.
 Post-Independence: Birth rates have gradually declined due to family planning initiatives,
increased literacy, and urbanization. Similarly, death rates have decreased significantly due
to improvements in healthcare infrastructure and disease control measures.
Sex ratio

 Pre-Independence (Before 1947) :The sex ratio in India before independence showed a significant
gender imbalance. 1901 Census: It decreased to 964 females per 1000 males.

 Post-Independence (After 1947) :After gaining independence, India has implemented various
policies and initiatives aimed at improving gender equality NFHS-5 (2019-21):. The overall sex ratio
for the population stood at 1020 females per 1000 males
The sex ratio in India has historically been skewed in favor of males, both pre and post-independence.
However, post-independence efforts have led to gradual improvements, due to increased awareness and
governmental measures such as the Beti Bachao Beti Padhao