The revival in the economic growth will not only push up average income of people but will also help the government reduce the fiscal deficit.
According to CSO data, the average income of an Indian will rise by 9% to Rs 43,749 during 2009-10 at the current price compared to 13.3% in 2008-09. The per capita income, which is an indicator of collective prosperity, was Rs 40,141 in 2008-09.
The lower growth rate in 2009-10 is partly because of poor exports as outward shipments add to the net national income while imports reduce it. Contribution of exports to the economy during 2009-10 is estimated to fall to 18.6% from 23.5% in 2008-09.According to CSO data, the average income of an Indian will rise by 9% to Rs 43,749 during 2009-10 at the current price compared to 13.3% in 2008-09. The per capita income, which is an indicator of collective prosperity, was Rs 40,141 in 2008-09.
Though, the net national income increased by 10.5% in 2009-10, the per capita income expanded by only 9%. This is mainly because of the rise in population from 1.15 billion to 1.17 billion in 2009-10.
The high growth rate will also help the Centre reduce its fiscal deficit as the percentage of GDP even if in the actual term it will be the same. With expansion of GDP at 10.8% at the current price, size of the Indian economy will become Rs 61,64,178 crore. In the last Budget, the size was projected at Rs 58,56,569 crore. As GDP is the denominator in the fraction, while calculating the fiscal deficit in GDP term, any increase in the GDP, lowers the value of fraction itself.
In last Budget, government had pegged the deficit at Rs 4,00,996 crore. It becomes 6.8% of GDP (at Rs 58,56,569 crore). Now GDP will be Rs 61,64,178 crore, the fiscal deficit will be 6.5% of GDP.
