India's GDP Per Capita Lowest Amongst All G20 and BRICS Countries!
- Jasaro.in
- Dec 3, 2024
- 4 min read
Updated: Mar 18
Gross Domestic Product (GDP)
Gross Domestic Product or GDP serves as a key metric for assessing the magnitude of a nation's economy.
Top 5 Countries by GDP in 2024, as per IMF:
United States: $29.17 trillion
China: $18.27 trillion
Germany: $4.71 trillion
Japan: $4.07 trillion
India: $3.89 trillion
GDP Per Capita or GDP Per Capita (Nominal)
GDP Per Capita is a key indicator of economic performance and a common way to measure the living standards, and economic well-being of its population.
It's also used to assess a country's real economic growth.
It is calculated by dividing a country's total GDP by its population
A higher GDP per capita generally signifies a higher standard of living for its citizens.
"In my view, rather than GDP, GDP Per Capita income is the true measure of prosperity. And, India ranks very low on that global yardstick." - P. Chidambaram, Former Union Finance Minster (4 times).
GDP Per Capita (Nominal) vs. GDP Per Capita (PPP)
The main difference between GDP per capita at purchasing power parity (PPP) and nominal GDP per capita is that PPP adjusts for the cost of living, while nominal GDP does not. Global experts prefer to use GDP Per Capita (Nominal) as a de facto measure, and we'll use the same for clarity.
BRICS Nations - GDP Per Capita - 2024 (IMF):
Russia: $14,953
China: $12,969
India: $2,698
Brazil: $10,296
South Africa: $6,377
India has the lowest GDP Per Capita amongst all G20 and BRICS countries!
G7 Nations - GDP Per Capita - 2024 (IMF):
United States: $86,601
Germany: $55,521
Canada: $53,834
United Kingdom: $52,423
France: $48,012
Italy: $40,287
Japan: $32,859
For European Union (EU) its $43,350.
India's GDP Per Capita Performance
As per IMF, India's GDP per capita is $2,698, and is ranked 141, before countries like Bangladesh, Pakistan, Kenya, and most of the African continent.
Compared that to China with a similar population, who's GDP per capita (nominal) is $12,969, 4.8 times more than India.
From 2004 till 2014 during Manmohan Singh Govt, India's GDP per capita grew from $624 to $1,560, an 150% growth.
Since 2015 to 2024 during Modi's Govt, India's GDP per capita has grown from $1,590 to $2,698, a mere 70% growth across these 9 years.
Finance Minister's Performance:
When Nirmala Sitharaman took over as the Minister of Finance and Corporate Affairs in 2019, India's GDP per capita has grown from $2,050 to $2,698, a meagre 37% growth in all these 9 years.
Yes, Covid-19 happened in 2020.
To be fair, let's compare where China stands?
As per IMF, China's GDP per capita is $12,969, and is ranked 70.
From 2004 till 2014, China's GDP per capita grew from $1,509 to $7,636, an 405% growth.
From 2015 to 2024, China's GDP per capita has grown from $8,016 to $12,969, a mere 62% growth across these 9 years.
On an apple to apple comparison, in terms of growth percentage, India has shown a minute growth in comparison to China.
However, India's $2,698 GDP per capita vs. China's $12,969 GDP per capita reflects a stark contrast in terms of the living standards, and economic well-being of the respective population.
3 Classes of Consumption in India
1. The Consuming Class (~140 Mn, $15K p.a.)
High-income, global-standard consumers. They contribute 2/3rd of India’s discretionary spending.
2. The Emerging Aspirant Class (~300 Mn, $3K p.a.)
Emerging consumers, heavy users of UPI and small-ticket services, yet cautious buyers.
3. The Unmonetisable (1 Bn, < $1K p.a.)
Low-income, very limited to no discretionary spending power.
So, the consumption story is layered, where the rich continue to prosper, while 90% (poor) face declining purchasing power, indicating the widening economic divide in India.
Widening Wealth Disparity
Perhaps the most pressing challenge is the "income inequality." By early 2024, the richest 1% of Indians controlled a staggering 40.1% of the nation's wealth - the highest since 1961. Their share of total income was 22.6%, the largest since 1922.
Meanwhile, the richest 10,000 individuals held an average wealth of $271.91 million - 16,763 times more than the national average of $1,623. In stark contrast, the bottom 50% of the population accounted for just 15% of total income.
Raghuram Rajan puts it succinctly: "Despite headline GDP growth, real incomes for most Indians have remained stagnant for years now, particularly in rural areas."
Not to indicate anything:
Mukesh Ambani's net worth has grown from $18.6 billion in 2014 to $113.2 billion in 2024.
Gautam Adani's net worth has grown from $7.1 billion in 2014 to $116 billion in 2024, increasing by ₹10 lakh crore in the last 5 years.
Any Thoughts?
Content updated on 12-Mar-2025.
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