India becomes a $ 4 Trillion Economy on the expense of Poor Bharat

Briefing the media last week, after tenth Governing Council Meeting of NITI Aayog in New Delhi, CEO Subrahmanyam said India is now a ‘four trillion dollar’ economy, standing only behind USA, China and Germany. He further stated India  according to IMF  estimates has slightly  overtaken  GDP of Japan’s US$ 4,186.431 billions. Despite being the fourth largest economy globally in terms of  nominal GDP,   looking deep the data reveals disturbing facts such as low per capita GDP and human development index, besides very high inequalities. 

Interestingly, timing of revelation of this economic  achievement  is surprising at a time,  many questions are being raised  regarding gruesome Pahalgam attack, intelligence failures, untimely ceasefire with Trump’s intervention and  greying Vishwaguru image of PM Modi globally and nationally. Perhaps the time  is  correctly chosen to  divert public attention  from all these  issues and  persisting  domestic economic woes.

  In wake of  claims  of  becoming the fourth economic power and  doubling of  per capita income during the last one decade of NDA rule, poverty reduction, why  82 crore  citizens are still receiving free grain rations, despite  dispensation of  nearly Rs lakh crore worth of MUDRA loans and high rates of  unemployment persist. It’s a widely acknowledged that present regime as part of its neoliberal economic philosophy is actively  working to   privatize public assets and  dismantle the self reliant  economic model of the nation.

 Widening inequalities

GDP being a single figure to capture growth is easy to measure and widely used for standard comparison. Governments are obsessed with GDP growth as reflection of their performance, despite the fact that it leaves out too many things which are crucial to deliver economic growth and provide employment. According to the IMF, with a per capita GDP of US $2,878.45, India is ranked 141st out of 194 economies in the world. In  rupee terms of monthly income it equals to Rs 20,389 for every citizen. According to Oxfam, 2025, the richest 1% in India is estimated to control over 40% of the country’s total wealth, while the bottom 50% own just 3% of GDP.  In real terms of average  monthly  income, urban poor earn Rs 15,000, while their rural counterparts earn mere  Rs 10,400 per month. On average poor in villages get employment on average 200 days  but not  although the year. There exists  gender disparity in wages as well. Hence, its unscientific to equate per capita GDP  and income drawn by Mr Adani with a common man earning merely Rs. 10,000 a month.

Billionaires Pocketing Wealth
Today economy is in doldrums as  manufacturing and agriculture  are facing severe crisis. The share of manufacturing has plummeted to 13 percent  and the domestic consumption is  not rising either. Exports of manufactured goods, farm products and services  are facing uncertainty from President Trump’s protectionism and high tariffs.   Added to this, the,  neoliberal, anti people policies of  present PM Modi government followed during the last  11 years  severely battered the performance of  MSME and public sector units. MSME sector comprise a large number of micro enterprises and employs a large number of daily wage earners. MSME, shares in overall GDP is around 30 per cent (GOI, 2018), and accounts for about 45 percent of manufacturing output and around 40 percent of total exports of the country. RBI study (2018) reports that Micro, Small and Medium Enterprises have been adversely hit by demonetisation and  rolling out of the Goods and Services Tax (GST). Access to credit and  resources are lifeline of MSME sector. Both demonetisation and GST  have severely (nearly 82 percent of units) affected  them , increasing compliance and other operating costs as most of the units were brought into the tax net. Consequently nearly 40 percent of  wage earners lost employment as  many units  became bankrupt and closed.  During the last 11 years Modi government   has privatized and gifted away several public assets starting from sea ports, airports, highways, coal imports, power plants, cement, gas and solar projects to Adani and a to a few selected crony capitalists at  throw away prices. Even  not considering a single tender , keeping away potential competetetors.   Closure  or handing over of a large number of public sector units to the networth of Rs17 lakh crores not only crippled the  economy but also   worsened the  unemployment problem.  For example, in 2013 public sector establishments nation wide employed nearly 17 lakh workers and  after a decade the number shrunk to 12 lakhs.

Transfer of  valuable public assets to  a handful of crony capitalists  has enormously  increased  their  wealth. Today combined net worth of   Adani and Ambani amounts to Rs17 to 18 lakh crores ($200 billions). While  1 percent of  super rich are owning nearly 43 Percent   and  bottom 50 percent of wealth, only 3 %  is owned by bottom 50 percent of population, clearly shows  the extent of prevailing inequalities in distribution of GDP.  In 2024, the agriculture sector contributed to approximately 16% of India’s GDP.  A major reason for poverty in  rural India as it is surviving with low wages and  consumption of goods. Unless  government’s  investments in villages rise, farmers  are ensured of  guaranteed prices for their produce , land is distributed democratically to landless and tenant small farmers production and incomes will not rise this sector’s share of GDP..

 Not content  with  transfer of public assets to a few privileged capitalists under  National Infrastructure Pipeline 1 in recent past,  Niti Ayog  today  is proposing a plan  NIP II, by identifying  infrastructure projects under the  public assets  for  further privatization to mobilize Rs10 lakh crores. The proposed  transfer of assets and land parcels will include-  highways, railways, power, petroleum and natural gas, ports, warehousing and storage, urban infrastructure, transport, coal mines and telecom and others. This move  will further  deteriorate economic health and  potentially reduce  share of GDP from manufacturing sector.  It’s a well known fact that  Ambani and Adani are the chief beneficiaries of  privatization of PSUs. But  together  Ambani and Adani, with a net worth of  $ 200 billions or Rs 18 lakh crores   employ merely  4.0 lakh workers against nearly 12 lakh workers in public sector.

Unless   radical measures are taken  to rise income of workers and  farmers,  per capita GDP of the later will not rise and  India can not  emerge  in to a middle income  “ Vikasit Bharat”.

Dr. Soma Marla, a retired  Principal Scientist with ICAR, Govt. of India and Associate Professor, Virginia Polytechnic & State University, USA.