Has India become richer or struggled under the story of its growth? The founder of the Hell Hell Aksat Sharfastava, in a publication on X, emptied the mixed signals of India’s economy.
On the one hand, India is preparing to become the fourth largest economy in the world through GDP, bypassing Japan this year.
On the other hand, approximately 800 million citizens depend on free subsistence shares, home savings at the lowest historical levels, and the rupee has decreased to its weakest levels.
The growth of GDP in India, which is a major indicator of economic health, is written, showing disturbing trends.
“Since 2019, the average growth rate of our gross domestic product has been about 6 %, which is related to an increasing economy on the scale of India,” explains Shrivastava. In comparison, China has grown at dual digital rates during the peak growth phase.
Special spending, which constitutes 60 % of the gross domestic product of India, slows down. Over the past five years, its average growth has only reached 4.8 %. “High taxes and low household savings are the main contributors to this slowdown,” he noticed. The proportion of savings to GDP in India has become its 50 -year low, leaving less income to be eliminated to calm economic growth.
Foreign investors also send mixed signals. While foreign direct investment flows (FDI) increased by 26 % in the first half of the fiscal year 24-25, the net foreign investment has decreased-a more accurate indicator after calculating external flows-to its lowest level in 12 years. “This indicates that foreign investors are not betting on the long -term horizons of India,” Sriffastava warns.
The weak rupee, in theory, must attract direct foreign investment, where investors can buy more foreign currencies. However, even with INR from 54 to 86 against the dollar during the past decade, participation in foreign direct investment and foreign institutional investor (FII) decreased. Shrivastava highlights, “Local consumption alone cannot pay huge growth. Real growth requires foreign investments or export of goods and services.”
To reflect these trends, Shrivastava suggests tax cuts and best financial policies. “Rationalizing taxes is necessary to expand the base outside the current 2 % level. This will pay the markets, enhance consumption, and encourage growth.”
His advice to investors? Global diversity, investment in highly growing sectors such as artificial intelligence and semi -conductors, and preparing for the high inflation environment. “Your wealth is in your hands.”