India's economy surpasses United Kingdom | Hacker News Reader

India's economy surpasses United Kingdom

timesofindia.indiatimes.com

59 pointsGarbage38 comments

With all the massive, extreme poverty in India this only shows how meaningless GDP is as a mean to illustrate economy's condition.

Not to defend the GDP overall, but you could just use a per capita GDP for that sort of comparison.

GDP per capita is better than raw GDP but it still doesn't factor in wealth inequality, purchasing power parity etc.

You can see the issue with a Representative economy here (UK)

https://upload.wikimedia.org/wikipedia/commons/thumb/1/10/UK...

Of course the Government always uses Mean since it sounds a lot better.

> but you could just use a per capita GDP for that sort of comparison

GDP per capita would not tell you the distribution of wealth (or more accurately income).

OTOH, the richest 3% of India (and that is some very rich people) is the size of the entire UK population, so from a global macro standpoint...

Yes, there were conspiracy theories on some other site about education and how Chinese/Indian student could pay the oversea cost of university in the UK when "only the 1% would be able to afford that in their respective countries", so it is impossible that the UK universities budget was affected at all by them.

That's 25 million people and the UK has prestigious universities attracting said people.

Well, the UK has massive inequality as well, although not on the scale of India. https://www.theguardian.com/uk-news/2016/dec/16/brexit-brita...

It is not meaningless in terms of foreign policy. It's a good measure for importance in trade relations and industrial capacity for war.

The phrase "economy surpasses" gives a very different impression. The only thing I can take is that India is now generating more income. I'm not sure what to make of it because if one were to look at the income/wealth distribution numbers where the richest 1% hold nearly 60% of India's wealth [0]. It would be interesting to see if this income is enough for India (under equitable distribution assumptions), to make India "unpoor". IF so, it would mean that India does not lack the money or resources. It lacks the means to distribute its resources.

[0] https://www.credit-suisse.com/us/en/about-us/research/resear...

Yeah and how is that number skewed in the US... India has a much better distribution than most Western countries. The problem is that it's divided over a billion people. UK has a significantly smaller population.

> The problem is that it's divided over a billion people. UK has a significantly smaller population.

UK also is significantly smaller in size too. Just in case, the population density of England is higher than that of India.

dunno how area or population density affects economic output other than perhaps for agrarian economies that need the land. maybe real estate, but you can build up you don't need tons of land for that.

More people, more services and more goods produced - more GDP.

true.Indian GDP is not based on exports but rather Indians producing goods,services and selling to Indians which has a population of 1 billion is pretty much the backbone of our business which contribute to GDP. Each state in India is the size of an European country Competing each other to surpass the growth level are the driving factors of Indian economy..

India still has a long way to go on a social level (as does all of humanity in a sense) but I think things are really improving there at least, especially compared to Pakistan and Bangladesh.

You say it like there was ever a comparison here since just after independence.

"Owing to Britain's recent Brexit-related problems.." -- I'm not aware of any Brexit-related economic problems. On the contrary, all news I've seen since has been positive, to the surprise, and disappointment, of many.

https://www.google.com/?gfe_rd=cr&ei=B-lXWP3BD6Ti8AeIu6i4BA&...

This might help you see some problems.

This might help you see that view is simplistic:

http://www.bbc.co.uk/news/business-37786467

From the article:

"That pattern is however a rather unbalanced one, the only sector of the economy that continued to grow was services up by 0.8%; agriculture, manufacturing production and construction all shrank."

What exactly about Brexit spurred this leap in the growth of yoga studios, burger chains, and Star Trek box office returns (A drop in the GBP, as it turns out, for the latter)? Because it seems like losses in everything else is pretty much what economists expected. Manufacturing declined despite a drop in the GBP.

All central banks continuously print money because they consider their currency "too strong" and say this will hurt exports.

At some point the exchange rate falls and suddenly no one is happy with it either. Recent examples are China, GB, Brazil, Venezuela.

The truth is - as with your comment - a surging/falling exchange rate is neither good nor bad. It has positive and negative effects and things will balance out.

Or to say it differently:

An exchange rate is never low, nor is it high, it is precisely where it should be. - Gandalf the Grey

A falling currency signals a weak economy.

If you print money, you are in control and you do it because you believe that you currency strength is harming your economy somehow: that's like a Sales because you want to get rid of stock to introduce a new model for example.

In this case the other countries are dumping GBP because they think the UK economy will become weaker. That would be like a Sales because your product is flopping.

Same effect, difference cause. One is voluntary on the country/company term, the second is forced by the other actors of the market. The fall of the GBP is significant. The rest of the World is shorting the UK right now and that in itself can be what pushes the UK economy in danger zone.

Printing out money also increases the market cap of the currency; which means that people have more currency in their pockets. Devaluation of a currency does not.

Nations typically publish GDP numbers in their own currency. To compare them you would have to convert them to a common base. Since the Brexit vote result has become known, the GBP has fallen to its lowest level since 1985. This would harm its ranking in a comparison like this.

A low pound is good for British exports and tourism to the UK, but harms British buying power of imported goods. If it's good or bad depends on your viewpoint, I guess.

> A low pound is good for British exports and tourism to the UK

Tourism perhaps, not that good for exports when we have to import all the stuff we use to make the exports and/or most of your exports are service based.

If 75% of the value of a good is from the imported raw materials and the rest is added by the processing applied in the UK then the remaining 25% benefits from the weaker Pound when the good is exported and the rest of is net unaffected by the change except to the extent that capital requirements effectively go up for the value of the intermediate goods in the supply line.

Absolutely but in the short term you have to buy your raw materials at a cost that is now much higher (temporarily) which can be a nasty shock for companies and something we've seen here.

I don't think that anybody on the UK is disappointed as such, more just deeply cautious of any good news being taken too seriously - given that there is still literally no idea what the UK's geopolitical position will be like in two years.

The UK pound is down and as such the value of a lot of things in the UK is worth less expressed in US$. That doesn't mean there's a structural problem.

I saw some news about price rises of various technological goods that are imported. That wasn't good news.

And all the news about how the pound has tanked against foreign currencies, which will eventually push up the cost of almost everything. The days in which physical UK exports were made out of commodities that aren't themselves imported are long gone.

Non-physical exports might fare better, but the news about banking and financials has been about how they're doing due diligence on moving to elsewhere in Europe, so that's bad news.

Sure, I've heard some positive news too, but I've heard a lot of negative news. How come you haven't?

A country as large as India, with over a billion citizens, ought to have a bigger economy than a small island nation that has turned its back on its historical engines of wealth and power.

> its historical engines of wealth and power.

slavery, rum, tobacco, wool, sugar, coal & sea power

and tea of course

This comment sparked me to find this interesting website http://www.globalslaveryindex.org/findings/

Yes, that is a depressing place - more slaves now than in all human history, if one counts indentured labour and other forms rather than "owning" someone by outright slave trading.

Certainly sea power. Also steel, armaments, shipbuilding, shipping, aeronautics, and all manner of other tangible goods and trade.

Having 80% of your economy[1] tied up in parasitic service sector make-work and financial services smacks of decadence and decline.

[1] https://www.ft.com/content/2ce78f36-ed2e-11e5-888e-2eadd5fbc...

I live in the North, it used to be a powerhouse of textiles, coal and steel.

Now it's just a shell of the glory days, there is no growth. It was no surprise the people here voted for Brexit. The SE sucks the wealth fro mthe nrest of the nation, taking the best investment with it.

And we're only 200 miles away. Imagine Orlando having a baseline of $1m for a 3 bedroom house and Miami full of boarded up buildings.

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