Net National Product (NNP) at factor cost (at 1993-94 prices) increasedfrom 0.5 per cent in 1991-92 to 6.3 per cent in 1999-2000. It increased to8.8 percent in 2003-04 at 1999-2000 prices. Similarly, per capita NNPincreased from -1.5 per cent to 4.4 percent and then to 7.0 percentduring the same period. Gross National Product (GNP) at factor cost (at1993-94 prices) increased from 1.1 per cent in 1991-92 to 6.2 percent in1999-2000. It increased to 8.7 percent in 2003-04 at 1999-2000 prices.Gross Domestic Product (GDP) at factor cost ( at 1999-2000 prices) hasincreased from 4.4 percent in 2000-01 to 7.5 per cent in 2004-05. The industrial sector has been going through a process of restructuringand consolidation after liberalisation. The industries have responded tothe reforms through mergers and acquisitions, adoption of cost cuttingmeasures, foreign collaboration, technology upgradation and outwardorientation in sectors such as cement, steel, aluminium,pharmaceuticals, and automobiles. Industrial growth increased sharply inthe first five years after the reforms, but then slowed to an annual rate of4.5 percent in the next five years. From low growth rate of 2.7 per cent in2001-02, the industry sector grew at a rate of 7.1 per cent in 2002-03and further to 9.8 per cent in 2004-05.There has been steady and continuous rise in supply of money in theeconomy since initiation of reforms. Reserve Money(Mo) has increasedfrom Rs.99,505 crores in 1991-92 to Rs.573066 crores (Provisional) in2005-06. Narrow money (M1) has increased from Rs.114406 crores to193
ABM 502 Unit VRs. 825245 crores (Provisional), while, broad money (M3) has increasedfrom Rs.317049 crores to Rs.2729535 crores (Provisional) during thesame period.Low and volatile growth rates in Indian agriculture and allied sectors wasreflected in the average annual growth rate of value added in the sectordeclining from 4.7 per cent during the Eighth Plan (1992-1997) to 2.1 percent during the Ninth Plan (1997-2002). From negative growth rate of-7.2 percent in 2002-03, the agriculture sector grew at a rate of 10.0 percent in 2003-04 and at a rate of 6.0 per cent in 2005-06. As a proportion of GDP, the share of exports, which had grown from 5.8per cent in 1990-91 to 12.2 per cent in 2004-05, grew further to 13.1 percent in 2005-06. The corresponding rise in imports was from 8.8 per centin 1990-91 to 17.1 per cent in 2004-05 and further to 19.5 per cent in2005-06. Thus, trade deficit as a proportion of GDP, which had declinedfrom 3.0 per cent in 1990-91 to 2.1 per cent in 2002-03, widened to 4.9per cent in 2004-05 and further to 6.4 per cent in 2005-06. Performance of the Indian economy on the inflation front, with pricestability as one of the prime objectives of the reform process has beensatisfactory, particularly after the mid 1990s. The annual average inflationrate based on Wholesale Price Index (WPI) was 10.6 per cent between1991-96, which fell down to 5.1 per cent in the period 1996-2001 andthen to 4.7 per cent in 2001-06.