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ENTREPRENEURSHIP, GLOBAL ECONOMY

A view on the Global Economy, Entrepreneurship and India Growth

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September 08, 2020
kiran-inner
Kiran Kumar

What a decade it has been! Never in the History of the world did we perhaps have this sense of optimism, to change the world for the better. We are entering an exciting phase where we are seeing young graduates and evangelists alike, moving away from fancy jobs to opt for a startup instead.

In India, this has peaked in the last two decades, with global investors and government-led programs adding fuel to the already thriving entrepreneurial ecosystem in India.

With the most important election in the world taking center stage in almost all our conversations these days for many unique reasons, it is interesting to see how the future will be for Indian entrepreneurs. It is impossible to foresee our trajectory without comparing it with our neighbor, China. So, let us spin the wheel with some factual information rather than skewed politics

  • China’s GDP in 1990 was $360 bn, while India’s GDP was $320 bn. Today, China’s GDP is $14 Trillion while India’s is about $3 Trillion.

For more info –

  • From 1998 to 2004, India’s GDP grew from $420 bn to $820 bn. Again, from 2005 to 2014, India’s GDP grew to about $2 tn. In the last 6 years, since 2014, we grew by about $700 bn in terms of GDP.

Our GDP has doubled every few years consistently since the late 1990s. In that sense, most of the GDP growth is driven by population growth, urbanization and enterprise. While policy had a role to play, our population and market forces always figured out a way forward.

Our GDP is skewed towards Agriculture & Service sectors while China’s is skewed towards Manufacturing / Industry. So, while the above comparison is valid to make, every country and its situation is unique.

A new world economic order is in the making, with today’s emerging markets, like India and Indonesia, at the heart of it. It is forecasted that China’s GDP will grow to $64 tn by 2030 while India’s will be second at $46 tn, followed in third by the US at about $32 tn.  Interestingly enough, a lot of new third-world economies start to emerge in the decade to come. So exciting times as we speak.

Top 10 countries by nominal GDP using PPP Exhange rates by the year 2030

The pandemic has definitely hit the Services sector hard, not just in India but the world over. The impact is here to see! However, we seem to have realized the importance of nature-positive growth, and the next big investments are set to take off in this area. Governments have provided fiscal support to the order of $10 tn during this pandemic and have put Green Economy, Human Centered Technology and inclusiveness top on their Agenda. The next set of big ideas from entrepreneurs are set to come in this area and we should be in for a beautiful ride. Perhaps the balance has been restored to some extent!

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