Interesting numbers: India claims its GDP is $3.73 trillion, while China's is $18 trillion. Therefore, China's GDP is 4.8 times larger. However, when comparing total tax revenue, India reports $421 billion, whereas China reports $2.8 trillion, which is 6.5 times that of India. In terms of government spending capability, India's budget is $580 billion compared to China's $4 trillion, making China's budget 6.9 times larger than India's.
What's more intriguing is that in 2014, India's total tax revenue was 16% of GDP. Under Modi, in 2023, this figure dropped to 11.1% of GDP. This suggests two possibilities:
The current government may not be able to collect taxes at the same rate as in 2014.
India's reported GDP figure might be inflated.
If we assume India's actual tax rate is still 16%, matching China's current rate and India's rate in 2014, then India's real GDP would be $2.63 trillion, not $3.73 trillion. This aligns closely with India's GDP estimate based on its budget.
In conclusion, India's real GDP is likely less than $3 trillion, ranking it number 8 in the world, just behind France's $3.1 trillion. Modi's goal of making India the world's third-largest economy seems to be an ambitious aspiration rather than a realistic expectation.
