Yes, the Indian Economy was the largest 2000 years back holding the 33% to 37% of the world share of GDP. However, it was mainly because of the large population India had (and still has). A farmer in Europe earned the same as a farmer in India, in that way India had a better climate, more land, a lot of rivers and a LOT of farmers too. But this began to decline because the Subcontinent was never united by any empire in history, therefore, the economy was never centralized. In addition to that, a lot of money was wasted in fighting wars against each other.
India has been exploited since centuries by foreigners. Not going so deep into history, everyone knows that the British Colonial Rule proved bad for India economically but not only British can be blamed. The blame also goes to their predecessors, the Mughals, Marathas, and the others could modernize but they were very busy in their throne fights. Taking the advantage of this division among us Indians the British played their card and conquered the region. The British Industrialization was very much limited to their benefits and was very purposeful. These Dark Ages continued from the 1600’s to 1947. During this era, India had significantly reduced from 37% of global GDP to less than <3%.
In 1947, all industries in India faced a serious challenge due to Partition of India because mostly all industries were left in India and producing regions were given to Pakistan. However, in some years the Indian Economy revived from the shock.
Mahatma Gandhi and Jawaharlal Nehru were highly impressed by the Five Year Plans System of the Soviet Union and brought it to India. India remained a closed economy till 1990. Nehruvian Socialism was successful in its initial stages but later like in all socialist nations, corruption and SLOW ECONOMIC GROWTH was the issue. Till 1990 India followed this policy and the after that India was introduced to another era by the Former Indian Prime Minister of India P.V. Narasimha Rao and Dr. Manmohan Singh.
Economic Liberalization of India
One of the largest decisions taken by the Government of India was the Economic Liberalization of India to tackle slow economic progress of the Indian Economy. India was facing a macroeconomic crisis in 1990’s when the Nehruvian Socialism was on a steep decline.
From 1947 to 1992, India had made 2 things – a true democracy and poverty. The Economic Liberalization of India allowed small businesses to start without LICENCE from the Government. This allowed many to be self-employed and created many jobs. Also, the Government eased trading and other import/export businesses which made goods cheaper. The plan although was not visibly effective in a short term but it was a blessing for India’s future.
2000’s and 2010’s
India was sanctioned by many nations after 1998 May when India tested nuclear weapons in Pokhran (Pokhran-II). Many Western nations criticized India for testing nuclear weapons. Many countries eased those sanctions in the next 10 years and removed them because of the US-India Civil Nuclear Agreement of 2008 which gave India a privileged position in the world which let India possess and trade nuclear material without signing the Nuclear Proliferation Treaty.
After the sanctions were removed, many US companies outsourced jobs to India because India produces a lot and lot of engineers annually who are being employed in the companies.
Today India is the fastest growing economy since 2014 and currently the 3rd in Power Purchasing Parity (GDP-PPP). India has the 2nd largest population in the world and with an average age of 29 with 50% below 25 years thus has a large workforce for generations, unlike China which has a higher average age due to its repressive One-Child Policy. This makes the Indian Economy extremely promising.
The Indian Economy is been growing at a very fast pace, catching up as soon as possible. The Indian Economy is set to surpass the US Economy by 2035 to 2040. According to many experts, India will become a developed country and economically advanced nation by 2050. Indian manufacturing sector is set to grow at the rate of 11% to 15% by 2020. Indian IT industry is set to become a very large contributor to the GDP in some years, which even today is considered one of the best. India is also the second-largest food producer after China and it is going to continue at this pace. The science and technology sector is one of the best in the world and is still growing at a very fast pace due to high skilled English-speaking scientists. The automobile sector will contribute to 17% of the economy by 2020.