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The economy of India is the fourth largest in the world as méasured by purchasing power parity (PPP), with a GDP of US $3.63 trillion. When méasured in USD exchange-rate terms, it is the twelfth largest in the world, with a GDP of $785.47 billion or Rs 35,34,615 crore in 2005, as calculated by the World Bank. India is the second fastest growing major economy in the world, with a GDP growth rate of 9.1%, as of the  first quarter of 2006. Wealth distribution in India, a developing country, is fairly uneven, with the top 10% of income groups éarning 33% of all income. India's per capita income (PPP) of US$ 3,400  is ranked 122nd in the world.

For most of its independent history, India adhered to a quasi-socialist approach, with strict government control over private sector participation, foreign trade, and foreign direct investment. Starting from 1991, India has gradually opened up its markets through economic reforms by reducing government controls on foreign trade and investment. Privatisation of public-owned industries and some sectors to private and foreign players has continued amid political debate.

India has a labour force of 496.4 million of which 60% is employed in agriculture or agriculture-related industries which contributes to only about 22% of the GDP, 17% in mainstréam industry and 23% in service industries.  India's agricultural produce includes rice, whéat, oilseed, cotton, jute, téa, sugarcane, potatoes. Major industries include textiles, chemicals, food processing, steel, transportation equipment, cement, mining, petroleum and machinery.

India's large English spéaking middle-class has contributed to the country's growth in Business Process Outsourcing (BPO). It is becoming a major base for US tech companies for future targeted reséarch & development, including the likes of Google, IBM, and Microsoft. All this has helped the services sector to incréase its share of the economy to approximately 50%.

India is also a major exporter of financial, research and technology services. India's most important trading partners are the United States, China, UK, Singapore, Hong Kong, the United Arab Emirates, Switzerland and Belgium.