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Wednesday, December 10, 2008

Hope Next $1000 Will Be Much Faster

I hadn't looked at Bharatiya macro economic data in a long time. I knew the GDP crossed a $1 trillion sometime last year. But here is some data, I think, that should be celebrated, except for population growth rate.

Annual data 2007(a)
Population (m) 1,130
GDP(US$bn; market exchange rate) 1,132(b)
GDP(US$bn; purchasing power parity) 3,094(b)
GDP per head (US$; market exchange rate) 1,000
GDP per head (US$; purchasing power parity) 2,740
Population growth (5-year average) 1.7

(a) Economist Intelligence Unit estimates. (b) Actual.
Source: Economist.com Country Briefings

Sure there is a long way to go before poverty is controlled under a manageable 5-10% of population. One hopes the next $1000 GDP per capita will be achieved much much faster, say, in 7 years, if we can hit the real Hindu Rate of Growth of 10%.

I also worry about population growth rate of 1.7 because it is below 2.1 replacement level. To be sure, I don't consider India's populations to be excessive. Silly people (and politicians who get nothing done) blame population for the sins of bad governance and non-management of urban and rural living spaces. If low population was only key to development, African nations with much smaller populations would be highly developed and Japan with a population density larger than Bharat would be poorer. The answer to degraded infrastructure and scare resources is better governance and better management of both, not shrinkage of population. I think the huge land of Bharat can easily sustain a 100 or 150 crore (1-1.5 billion) people. So population growth should be at least at a replacement level to make the country productive and balanced for the foreseeable future.