The Indian economy is the ninth largest economy of the world and also one of the fastest growing world economies. This growth is attributed to various Indian industries which have grown tremendously post independence to increase national income, to generate employment and to generate foreign earnings. India was initially an agriculture based economy but after liberalization norms of 1991 particularly, the services sector has taken a lead contributing the most to the gross domestic product. Presently the agricultural, manufacturing and service sector account for 16, 27, 57 percent of GDP respectively. The most important industries from the point of view of Indian economy are listed below:
10. Textile Industry (4%) :
Textile industry is a booming industry of India with India being one of the largest textile producers of the world. It makes a large contribution to the Indian economy in view of large proportions of its direct and indirect employees and its forex generation capacity. The textile sector accounts for 14 per cent of the total industrial production, contributes about 4 per cent to the national gross domestic product (GDP), and earns India 17 percent of its total exports. Around 35 million people are directly employed in textile industry. This means that after agriculture, the textile industry textiles employs second largest number of employees. Therefore, the development in this industry will definitely make the economy of the nation healthier.
9. Tourism (6.23%) :
Tourism is a still underdeveloped but potential sector in terms of contribution to the national economic growth. It provides for around 6.23 percent to the national Gross Domestic Product and also accounts for 8.7 percent of the total national employment. Though India is a popular destination among all visitors, but a large section of foreign tourists arrive in India from America and England. India has rich history and is a land of cultural heritage. Added to it is the diversity in terrain which attracts tourists who wish to enjoy a complete package. Medical, business as well as sports tourism has become popular lately and adds more to the potentials of this industry.
8. Chemical Industry (7%) :
Chemical industry, one of the earliest of all Indian industries contributes considerably to Indian economy and has been doing so since the times of independence. It manufactures 70,000 types of products ranging from toiletries and plastics, to cosmetics, petrochemicals, pharmaceuticals, fertilizers and many more. The large chemical industry contributes around 7 % annually to the GDP of India. The chemical industry has an impact over our lives in various ways. For example the thermoplastic furniture we bring to use at home, or the medicines we take, or even the synthetic fiber we wear or use for other purposes, chemical industry is linked to all of them. Also, the chemicals which are processed out of the chemical industries are used for development in agriculture and other fellow industrial sectors in ways like consumer durables, lubricants for automobiles, in engineering processing, as insecticides or in food processing.
7. Engineering and Machinery (8%):
In the recent times, the engineering and machinery sector has played a crucial role in boosting Indian economy and also developing other industrial sectors of the country’s economy. In 2012, the engineering sector alone made a contribution of 8 percent to the Indian GDP. If we consider the third World countries, India is largest exporter of both heavy weighted or light machinery and other engineering products. A large section of capital goods essential for power plants, agriculture technology, cement and construction, steel plants and petrochemical units as well as mining essentials are manufactured in India. India is also an efficient producer of tractors, harvesters, irrigation lines, earth movers, construction machinery, sugar mill machines, cars, commercial vehicles and air pollution control equipment. The electronics and electrical industry has also increased in capacity throughout India.
6. Transportation Industry (8.5%) :
The transportation industry of India is large and expansive. The roadways, highways, ports, aviation industry and railways, all form a part of the transportation industry. It is a growing sector which contributes around 8.5% to India’s gross domestic product. The recent years have witnessed tremendous growth in demands for both transportation means and infrastructure. Indian railways is one of the biggest railways system of the world, is managed under one authority and handles around 17 million passengers daily. India has 12 major and 187 minor ports, as well as 125 airports including 11 international ones. But it is the roadways which are dominant transportation system of India, with the highway density of 0.66 km of highway per square km of land, comparable with America.
5. IT and ITES Industry (9%) :
The Information technology industry is a knowledge based industry with skilled professionals in India. The IT–ITES industry is made up of the IT Services sector and the Business process outsourcing industry. The IT–ITES sector contributes significantly to the Indian GDP as well as employment generation and exports earnings. It has been the chief industry that has led the services sector account for a whopping 64% of the entire GDP. The IT sector contributes almost about 9% of the national GDP. The city of Bangalore is the leading IT exporter and is often compared to the Silicon Valley. Exports form the essence of the IT–ITES industry and earn 77% of the total industry income. As far as national exports are considered, IT industry accounts for 25% of the total national exports.
4. Banking and insurance (10%) :
The Indian finance market comprises the organised sector categorized into private, public and foreign owned banks and the unorganised sector including individual bankers or money lenders. The country’s gross domestic saving stands around 32.7%, most of it invested in personal assets like land, property or gold. The Indian Insurance Industry has grown in the recent past at rate of 15-20%. Today the Insurance plus banking services contribute to 10% of the country’s GDP. It is a well-evolved industry serving as a boon for economic development of India by providing long- term funds for development of infrastructure. Besides, it strengthens the risk taking capacity of the country. As per the Life Insurance Council, Indian life insurance industry ranks fifth among the largest life insurance markets of the world.
3. Real estate (13.5%) :
The real estate sector in India has developed a great deal by emerging as one of the fastest growing markets of the entire world. It has attracted both domestic real estate developers as well as foreign investors. The unhampered growth of the industry has been seen because of a large population, their increasing incomes and rapid urbanization process. It contributes around 13.5% of the GDP. The urban centers of India are expanding which means increasing land requirements for educational institutions, healthcare, offices, buildings and tourism industry. Since corporatization of real estate and professionalization has invaded, this sector has been recognized as one of the most important ones for the country’s economic development. The Union Budget of the year 2013 is also looking forward to enhance the sector sentiment more and towards re-stimulating its growth.
2. Agriculture (15.7%) :
India is the second largest producer of farm produce. Agriculture industry, apart from farming, also includes forestry, horticulture and fishing. It employs almost half the population of India and makes a contribution of 15.7% to the GDP. Though its share has declined over the years, it is still the means of securing overall socio-economic development of India. With considerable improvements in irrigation facilities, technological aids, modern agricultural practices, credits and subsidies, high crop yield has been secured. The Green Revolution in India has brought significant wealth to the farmers of Indian states of Punjab, Haryana and Uttar Pradesh. Besides them, West Bengal, Gujarat and Maharashtra are key agricultural states of India which produce both cash crops and cereals.
1.Retail and wholesale trade (23%):
Retail industry is the chief pillar supporting the Indian economy and contributes 23% towards the national GDP. The Indian retail market is among the top five world retail markets in terms of economic value. Also it is the fastest growing retail market of the world, again in terms of economic value. The retailing industry comprises of general stores, hand cart vendors, convenience stores and domestic outlets. The new concept of retail supermarkets has worked well and these supermarkets account for 4 percent of total retail market of 2008.Last year the government has also permitted 51% of foreign direct investment in multi brand retail as well as 100% FDI in single brand retail. This is believed to further increase investments in the retail sector and take it to new economic heights.