Over the past decade, India has demonstrated high GDP growth rates, which has had a positive impact on the welfare of local residents and led to an increase in the country's share of the global economy. Nevertheless, the republic currently belongs to the group of countries with below-average incomes: India's gross national income, calculated using the Atlas method, amounted to US$2,700 in 2024. In this regard, the country still has a long way to go to achieve one of the main goals set by the national government: to achieve high-income economy status by the 100th anniversary of India's independence in 2047. To do this, the republic needs to maintain rapid GDP growth for several decades, something that only a very limited number of countries have managed to do in the past.
In 2021–2023, India's economy grew dynamically due to the low base effect and rapid recovery of consumer activity after the COVID-19 pandemic, as well as the implementation of significant accumulated potential. In 2021, the country's real GDP grew by 9.7%, in 2022 by 7.6%, and in 2023 by 9.2%. By 2024, India's economic growth rate will have slowed to a moderately high level of around 6.5% per year, and this level is expected to continue in the medium term. At the same time, India's achievement of high-income status by 2047 is considered realistic, provided that its existing potential is used wisely and structural reforms are implemented.
Despite the economic successes of recent decades, India still faces a number of unresolved social problems. In particular, in recent years, the republic has significantly reduced poverty levels, but the scale of poverty remains high: according to the World Bank, in 2022, the share of the country's citizens living below the international poverty level (less than $3.0 per person per day) was 5.3%, while about 23.9% of Indians were below the poverty line set for countries with below-average income levels (less than $4.2 per person per day). In recent years, India has also seen a significant decline in unemployment, which stood at 4.2% in 2024. However, many jobs in the country are low-paying, which limits the positive impact of the increase in the share of employed citizens on the country's economic development. In particular, about 43.5% of the population is employed in agriculture, which in India is not very efficient and accounts for only 16.4% of the national GDP.
Inflation in the republic is gradually stabilizing after global price growth in 2022 and is currently within the target range set by the Reserve Bank of India. The indicator stood at 4.7% at the end of 2024 and is forecast to continue declining in the medium term. Against this backdrop, the Indian regulator has begun to ease its monetary policy, lowering the key rate by a total of 100 basis points to 5.5% between February and June 2025.
