Who's the man

Tuesday, December 30, 2008

A Little Math about the Indian Economy

Just some back of the envelope calculations. Figures that I've just begun to take interest in. I wanted to jot some down and put them in perspective.

1% SLR decrease => INR 40,000Cr released in the market.
M3 (money supply) = INR 40 trillion.
With a population of 1 billion => INR 40K per person.
Indian GDP = INR 41 trillion (which probably implies on an average, a Re. changed hands once in the year).

Now the forex (money) market has trading worth $3.8 trillion/day (4-5 X M3!).
But only 0.1% of the above transactions involve INR.

Tons more to know and be bewildered by.

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