$45 trillion, enough to buy Apple, Microsoft, Amazon, and Meta, and still have cash for a moon mission. That’s what British colonial rule is estimated to have drained from India.
In 1700, India held 25% of the world’s GDP. By 1947, that had collapsed to just 4%. Our first Prime Minister, Jawaharlal Nehru, inherited a nation with ambitions bigger than its bank balance.
His answer? Socialism, heavy industries, and Five-Year Plans, all wrapped in a dense web of licences and regulations. Growth was slow, around 3–4% annually, but it kept the economy afloat.
Seeds of Survival
The mid-1960s brought a nightmare, droughts, grain shortages, and the humiliation of importing wheat from the US to stave off famine. Prime Minister Lal Bahadur Shastri’s Green Revolution transformed agriculture, eventually making India self-sufficient in food.
But before that payoff, Indira Gandhi had to act fast, in 1966, she devalued the rupee by over one-third to secure IMF loans. Painful, but it kept the country from economic collapse.
The Cracks Appear
By the 1980s, Rajiv Gandhi was hinting at change. He eased import duties, opened doors to computers and telecom, and began chipping away at India’s economic fortress. The big shock came in 1991: reserves could cover just three weeks of imports.
Gold was flown abroad as collateral. In a landmark move, PM PV Narasimha Rao and Finance Minister Manmohan Singh liberalised the economy, slashed industrial licensing, welcomed foreign investment, and let the rupee float. The result? A new era of growth.
From Outsourcing to Outshining
The 1990s and 2000s saw the IT revolution take off. Infosys, TCS, and Wipro became global players, and GDP growth soared to 8–9% before the 2008 global financial crisis slowed the pace. A booming middle class emerged, and India began to be seen as a rising economic power.
Resilience in the Face of Shocks
Post-2008, the momentum wavered. By 2013, India was labelled one of the "Fragile Five" emerging markets. But reforms like the Goods and Services Tax (GST) unified the national market, and Unified Payments Interface (UPI) turned digital payments into a daily habit. Then COVID-19 struck in 2020, shrinking GDP by over 6%, the steepest drop in decades.
The Big Bounce Back
India’s comeback was swift. Infrastructure investments, a digital commerce boom, and strong domestic demand pulled the economy back into high gear. By 2025, GDP hovers near $4 trillion, placing India among the world’s top five economies, with its sights firmly on the top three.
From losing $45 trillion to the British to becoming one of the fastest-growing economies in the world, India’s economic story is nothing short of a historic turnaround, and the next chapter is still being written.
