Opinion
Growth is welcome but equity is important too
Summary
- India’s economy grew at 7.6% in the second quarter, which was an upside surprise. The stock market is cheering along. But GDP doesn’t tell us how well people at large are doing.
On 29 November 2023, the Indian stock market achieved a milestone, touching $4 trillion in market capitalization for the first time. This is higher than the country’s gross domestic product (GDP) of $3.4 trillion. A day later, GDP data released by the National Statistical Office for the second quarter of 2023-24 gave us an inkling why. At 7.6%, the quarter’s GDP growth has more than lived up to the Reserve Bank of India Governor Shaktikanta Das’s prophecy of an upside surprise.
Even with the prospect of a slowdown in the year’s second half, India is poised to become one of the fastest growing major economies in the world. CLSA, an investment group, projects India’s GDP at $45 trillion by 2052, making it the world’s largest. Yet, this is a rather inexact measure of individual well-being.
For that, we need to look at per capita income, a less inexact metric, and the sectoral distribution of growth. A reliable figure for median income (not an upward-skewed average, mind you), the level which splits a population into upper and lower halves, would tell us how people at large are doing. And then it’ll be clear we have a long way to go. Let’s not forget that equity is as important as growth.
