Since the mid-eighties in the last century, India’s growth rate on an average was concentrated at around 3.6 percent per annum. This period of growth was called as the Hindu rate of growth (Basu, 2004). However, the scenario started changing because of the transformative force brought about by the economic reforms of 1991. The average Indian growth rate went up, when Indian economy opened its markets after the fundamental reforms of 1991. Under these reforms, India advanced towards a free market economy following the policy of liberalisation of trade and globalisation of world market. In the late 1990s, following these reforms, India witnessed a growth rate of 6.2 percent. In the late 2000s, the growth rate reached to 7.5 percent. This phase of growth had a huge impact on the development of the country. This boost which was propelled by the policy of liberalisation kept the Indian economy growing at a healthy rate even during the period of recession in 2007-08.
India could manage to grow at the rate of 5.3 percent in 2009. The progress brought about by the economic reforms is followed closed in India. As suggested by World Bank, the sectors making most significant contribution to the growth of the economy are infrastructure, rural development, public sector reforms and removal of regulations imposed on labours.As per estimates of International Monetary Fund, India’s GDP at the beginning of the century was valued at 480 billion USD. As the pace was picked up by the economic reforms, the GDP of the country grew five times amounting to 2.2 trillion USD in 2015. In the first quarter of 2015, GDP of India stood at 7.5 percent as compared to China which was 7 percent, thus making India the fastest growing economy. During this quarter, the agricultural sector grew up by 0.2 percent, the manufacturing sector grew by 7.1 percent and the services sector of India grew by10.1 percent. The growth forecast by Indian government during 2015-16 is expected to reach 8.1-8.4 percent.