India’s Growth and Savings Analysis

The Ninth plan period ended with a growth rate of 5.70%. The Tenth five year plan aimed to transform the country into the fastest growing economy of the world. Year 2002-03 saw a growth rate of 3.88%. Investment and GDS shared 24.6 and 25.4% of the GDP respectively. 2003-04 registered a growth rate of 7.97%. Capital formation constituted 26.9% of GDP and 28.7% was shared by Gross Domestic Savings. India’s real GDP growth rate was 7.05% in the year 2004-05. Investment constituted 32.82% and GDS 32.41% of the GDP. Year 2005-06 saw a steep increase in the GDP growth rate, 9.48%. The share of investment and GDS was 34.65% and 33.44% respectively. 9.57% GDP growth rate was recorded in the year 2006-07. 35.66% of GDP was shared by Investments and 34.60% by GDS. Finally, the Tenth five year plan resulted in an average GDP growth rate of 7.59%. The Internal balance indicators stood at 31.08%, GDS and 30.76% Gross Domestic Capital Formation (% of GDP, 2004-05 series)

9.32% Growth rate was seen in 2007-08. Capital formation constituted 38.11% and savings constituted 36.82% of the GDP. Year 2008-09 saw a sharp decline in the GDP growth rate, 6.72%. During this period, the investment stood at 34.30% and GDS at 32.02% of GDP. GDP growth rate recovered to 8.59% in the year 2009-10. Investment constituted 36.30% and savings constituted 33.69% of the GDP. Year 2010-11 saw real GDP growth rate of 8.91%. 36.5% of GDP was shared by capital formation and 33.68% GDS. In the financial year 2011-12, again a steep decline in real GDP growth rate was seen, 6.69%. During this time, 36.4% and 31.35% of GDP was constituted by Investment and Gross domestic savings respectively. Hence, the Eleventh Five Year Plan recorded an average of 8.046%. The Internal balance indicators were 33.51% and 36.56% for GDS and Investment respectively.