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the new Indian government under Prime Minister Rao since 1991 has
been the driving force behind the reform efforts. The absence of any
reference model in terms of alternative models of market economy
reveals an essential deficit in the transformation process.
3.1 The heterogeneous character of the Indian economy
We cannot possibly dwell on the heterogeneous nature of the Indian
economy in its full extent and intent. The present discussion is mainly
confined to perceiving the Indian economy vis-a-vis the economic
poverty potential of the Indian population. At first sight the Indian
economy looks rather impressive. India ranks as one of the 10 top-most
industrialized nations of the world. In Asia, after Japan and China, India
ranks third in terms of gross national product (GNP) and thus holds a
distinct position among the developing countries. It may also be added
that India is emerging as an investor of considerable strength, not only in
South Asia, but also in European countries. Finally, it may be pointed out
that Indian economy holds fifth position globally, and in the group of
developing countries it is second only to China in terms of market
potential. Industrialized countries seem to have taken cognizance of this
phenomenon with keen interest.
Developing Countries 1992
| GDP per head, $ | GDP, $ billion | ||
| Market exchange rates |
Purchasing power parity |
Purchasing power parity | |
| China | 370 | 2,460 | 2,870 |
| India | 275 | 1,255 | 1,105 |
| Brazil | 2,525 | 4,940 | 770 |
| Mexico | 3,700 | 6,590 | 590 |
| Indonesia | 650 | 2,770 | 510 |
| South Korea | 6,790 | 8,635 | 380 |
| Thailand | 1,780 | 5,580 | 320 |
| Pakistan | 400 | 2,075 | 240 |
| Argentina | 6,870 | 5,930 | 190 |
| Nigeria | 275 | 1,560 | 190 |
| Egypt | 655 | 3,350 | 180 |
| Philippines | 820 | 2,400 | 155 |
| Malaysia | 2,980 | 7,110 | 130 |
Source: The Economist; EIU; World Bank
