India surpasses Japan to become world’s fourth largest economy
India has officially overtaken Japan to become the fourth largest economy in the world. Niti Aayog CEO BVR Subrahmanyam gave this information in a press conference on May 24. India has achieved this feat due to its economic policy.
Citing the data of the International Monetary Fund (IMF), Subrahmanyam said, ‘We are the fourth largest economy. We are a 4 trillion dollar economy. Today India is bigger than Japan. Now only America, China and Germany have bigger economy than India.’
The CEO of Niti Aayog also said that if we stick to our plan and thinking, then in 2.5-3 years we will become the third largest economy.
What is GDP?
GDP is used to track the health of the economy. It shows the value of all goods and services produced within the country in a fixed time. It also includes foreign companies which produce within the country’s borders.
There are two types of GDP
There are two types of GDP. Real GDP and Nominal GDP. In real GDP, the value of goods and services is calculated on the base year’s value or stable price.
At present, the base year for calculating GDP is 2011-12. Whereas nominal GDP is calculated on current price.
How is GDP calculated?
A formula is used to calculate GDP. GDP=C+G+I+NX, here C means private consumption, G means government spending, I means investment and NX means net export.
