GDP

What is GDP
• Gross domestic product (GDP) is a monetary
measure of the value of all final goods and
services produced in a period (quarterly or
yearly).
• Nominal GDP estimates are commonly used to
determine the economic performance of a
whole country or region, and to make
international comparisons.
 Components of GDP
• Consumption (C)
• Investment (I)
• Government Spending (G)
• Net Exports (X – M)
GDP = C + I + G + X-M
 How To Calculate GDP
Consumption
It is Household Final Consumption Expenditure and
It Includes
• Durable Goods
• Non-Durable Goods and
• Services
Eg: Food, House Holds, Medical Expenses, Rent,
Jewellery, Gasoline, etc.
Investment
Investment by Business or Households in Capital.
It Includes
• Construction of New Mine.
• Purchase of Machinery or Equipment for Factory.
• Purchase of software.
• Expenditure on New Houses.
• Buying Goods and Services.
Investments on Financial Products is not included in
Investments.
Government Spending
Total Government Expenditures on Final Goods and
Services.
It Includes
• Investment Expenditure by Government.
• Purchases of weapons for Military.
• Salaries of Public Servants.
It does not include any transfer payments, such as
social security or unemployment benefits.
Net Exports (X – M)
Gross Exports (X)
• All Goods and Services Produced for
Overseas Consumption.
Gross Imports(M)
• Any Goods or Services Imported for
Consumption.
Indian Economy-Facts on India GDP
 
• Indian Economy is the 6th Largest Economy in the world.
• India’s Nominal GDP is Ranked 6th in GDP Global Ranking.
• India was one of the most rapidly growing economies in the world till 2019.
• The GDP of India in the Year 2019 was US $2.87trillion.
• Ranks 3rd pertaining to Purchasing Power Parity (PPP) according to world
bank.
• The Growth Rate of Indian GDP in 2018-19 was 7.1%.
• As per reports in 2019, per capita income in India was $1,964 at Nominal
and $6,664 at PPP
• India’s GDP per capita is now 3.7 and 4.6 percent of US and French)GDP
per capita respectively.
 INDIAN ECONOMY AT A GLANCE IN YEAR
2020- 2021
• Population: 139 Cr. In 2021
• GDP: USD 3.15 trillion in 2021
• Per Capita GDP: USD 2265
• World Rank in Per Capita: 145
• GDP: 6th

Source: IMF (all estimates)

• Year 2020 per Capita GDP: USD 2171

• Population below poverty line: 1/5
 WORLD RANKINGS: 2021
• World economy: USD 93.8 trillion
• US: USD 22.67 Trillion
• China: USD16.64 Trillion
• Japan: USD 5.3 Trillion
• Germany: USD 4.3 Trillion
• UK: USD 3.12 Trillion
• India : USD 3.04 Trillion
• France: 2.93 Trillion
• Italy: USD 2.1 Trillion
• Canada: USD 1.88 Trillion
Source: IMF
 PER CAPITA WORLD RANKINGS 2021
1.Luxumbourg: USD1.31 L
2. Switzerland: USD 94 K
3. Ireland: USD 94 K
4. Norway: USD 81 K
5.US: USD 68 K
6.Denmark: USD 67 K
7. Iceland: USD 65 K
8. Singapore: USD 64 K
9. Australia: USD 62 K
10. Qatar: USD 59K
145: India: USD 2265
Source: IMF
 National Income

The total amount of income earned by all the 
people and institutions within a country from t
he production of goods and services
(usually measured over a period of one year).
 PPP
Purchasing power parity is defined as the
number of units of a country’s currency
required to buy the same amount of goods
and services in the domestic market as one
dollar would buy in the US.