Basic Characteristics of India as a Developing Economy

Basic Characteristics of India as a Developing Economy

We know that India is a developing country belonging to the Lower Middle-Income group. In this article, we will outline the basic characteristics of India as a developing economy. This will help us gain a better perspective of the Indian Economic conditions.

In order to understand the Indian Economic landscape, it is important to make note of some of the basic characteristics of India as a developing economy.

These are as follows:

Low Per Capita Income (PCI)

According to the International Monetary Fund's Report, in 2017, India's PCI was $ 1983 and was ranked 140 out of 188 countries.

Further, according to the World Bank's Report, in 2017, India's PCI was $ 1940 and was ranked 138 out of 184 countries.

Occupational Pattern 

One of the fundamental characteristics of India as a developing economy is that it is majorly primary producing. What this means is that a majority of the population is engaged in agriculture (around 52 percent).

Heavy Population Pressure

1.36 billion - the population of India as on January 17, 2019, 21:30 hours. We are the second most populated country in the world and our population is equivalent to around 17.74% of the total world population.

In India, the high levels of illiteracy lead to a high level of birth rates. Further, improvement in medical facilities has increased the average life of an Indian citizen and led to a decline in the death rates too.

Inequality in Wealth

Unequal asset distribution is the primary cause of inequality in income distribution in rural areas.

This inequality also highlights the fact that the resource base of 50 percent of households in India is weak.

It is so weak that it can barely provide them with anything above the subsistence level of income.

Poor Human Capital Quality

It is a simple equation. Underdeveloped countries have millions of illiterate citizens. Also, illiteracy retards growth since an individual needs a minimum level of education to acquire skills and/or understand social issues.

Low-levels of Technology

India is a country of eclectic mixes. One one side, a company uses one of the most modern technologies while another company from the same industry uses the most primitive one.

Unfortunately,according to modern scientific standards, the majority of products are made with the help of inferior technologies.