India as Developing Country

Following are the salient features of India as a developing economy:
• Rise in Net National Product
• Rise in Per Capita Income
• Structural Changes
Structural Changes of India:
Apart from the growth in quantitative terms, there have been significant changes in India’s economic structure since 1947. The structural changes indicate that the process of development which began in the early 1950s is still continuing. However the speed of change is slow and in certain areas one cannot say confidently whether change has really occurred. The structural changes include:
a) We can witness the slowly changing sectoral distribution of domestic product. The importance of agriculture and allied activities in the Indian economy has somewhat declined during the five decades of economic planning. During the first two decades of the planning period no firm trend was observed and the share of agriculture and allied activities in the gross domestic product fluctuated between 59.2 per cent and 45.0 per cent. However since 1970 -71 there has been a steady decline in the share of agriculture and allied activities in the gross domestic product and it was 26.6 per cent in 2000-01. During the first five decades of economic planning, the share of the tertiary or service sector, in the gross domestic product has increased from 27.5 per cent in 1950-51 to 48.4 per cent in 2000-01. Thus, there is definitely a significant change in the sectoral distribution of gross domestic product.
b) There is stability in occupational distribution of population. In a developing economy, occupational distribution population steadily in favour of secondary and tertiary sectors. This happens as a result of decline in the importance of agriculture. In India where agriculture accounted for 64.9 per cent of the workforce in 1991 as against 69.7 per cent in 1951, the occupational distribution of population has not changed significantly during the planning period.
c) Growth of basic capital goods industries is another indicator of structural changes in the Indian economy. A large number of basic industries which produce capital equipment and useful raw materials have been set up making the country’s industrial structure quite strong. These industries account for more than fifty per cent of the industrial production in our country.
d) Te expansion in social overhead capital is another structural change, which has made India a developing economy. There has been development of transport and communication, irrigation facilities, energy production units, educational system, organisational and health facilities etc.
e) Another structural change relates to the progress in the banking and financial sector of the economy. Since 1947, significant and progressive changes have taken place in the banking and financial structure of India. The nationalization of fourteen major commercial banks in 1969 was a major step in the development of banking system in our country.