HSC Economics Case Study: India

The Global Economy topic requires a case study of one economy other than Australia. Our China case study covers the most popular choice. India is the second, and in some ways the more interesting one to write about, because its path to growth has been so different from China's.

China grew by becoming the world's factory. India grew mostly through services, with a large share of its workforce still in agriculture, a much younger population, and a democracy that makes reform slower and messier. That contrast gives you arguments, and arguments are what the marks are for.

This guide follows the syllabus dot points with figures current to October 2026. One note on dates first: India's financial year runs from April to March, so "2025-26" means the year to March 2026.

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What the syllabus asks for

Your case study has to let you discuss the impact of globalisation on the economy through trade, investment, technology, labour and finance; the strategies used to promote growth and development; and the effects on economic growth, quality of life, distribution of income and environmental sustainability.

So learn India as a set of arguments, not a country profile. Every fact below is attached to one of those effects. If you are sitting the HSC in 2026 or 2027, this case study is required. It drops out as a requirement under the new syllabus first examined in 2028.

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India at a glance

Indicator	Figure	Source and period
Real GDP growth	7.8%	2025-26, revised in India's National Accounts Statistics, August 2026
Real GDP growth, previous year	7.1%	2024-25
GDP per capita	about US$2,800 nominal, about US$12,000 at PPP	IMF projection for 2025
Human Development Index	0.685, ranked 130th of 193, "medium"	2025 Human Development Report (2023 data)
Extreme poverty	5.3%, down from 27.1% in 2011-12	World Bank, US$3 a day line, 2022-23
Gini coefficient (consumption)	25.5	World Bank
Remittance inflows	US$129 billion, the world's largest	World Bank, 2024
Female labour force participation	40.0%, against 79.1% for men	Periodic Labour Force Survey, 2025
Two-way trade with Australia	about A$54.4 billion	2024-25

India has also been the world's most populous country since 2023.

Two of those figures pull against each other, and that tension is the core of any India answer. Growth near 8% a year is among the fastest of any large economy. Income per person, at roughly a fifth of China's in nominal terms, is still low, and the HDI places India in the medium development group. India is a fast-growing economy that is still poor, and the question is whether growth is turning into development quickly enough.

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1. The impact of globalisation

Trade

India's turn outward dates from 1991. A balance of payments crisis left the country with foreign exchange reserves covering only a few weeks of imports, and it turned to the IMF. The reforms that followed devalued the rupee, cut tariffs from some of the highest levels in the world, and dismantled much of the "licence raj", the system of permits that controlled what firms could produce.

What grew afterwards was unusual. Instead of labour-intensive manufacturing exports, India's comparative advantage showed up in services: IT, software, business process outsourcing and professional services, built on a large English-speaking, university-educated workforce. Firms like Infosys and Tata Consultancy Services became global exporters.

The mechanism to explain is this. Trade liberalisation let India specialise according to comparative advantage, but that advantage was in skill-intensive services, which employ relatively few people. So trade raised growth and incomes for the educated urban workforce much faster than for the hundreds of millions in agriculture.

Investment

Foreign direct investment was tightly restricted before 1991 and has been opened sector by sector since. The more recent push is in manufacturing. Production Linked Incentive schemes, introduced in 2020, pay firms subsidies tied to increases in output in targeted industries such as electronics, and Apple's suppliers have expanded iPhone assembly in India. Part of the appeal for multinationals is diversification away from China, which is a direct example of geopolitics shaping the direction of investment flows.

Technology

India built what it calls digital public infrastructure: Aadhaar, a biometric identity system covering most of the population, and UPI, a real-time payments network. Together they cut the cost of opening bank accounts, making payments and delivering welfare transfers directly to recipients. This is a strong example of technology as a development strategy rather than just a growth driver, because it reaches people who were outside the formal financial system.

Labour and migration

India is the world's largest recipient of remittances, at around US$129 billion in 2024 according to the World Bank. Migrant workers in the Gulf, the United States, the UK and elsewhere send money home, which supports household consumption and adds to foreign exchange earnings. It is also one way globalisation spreads benefits beyond the cities, since many migrant workers come from poorer states.

Finance

The 1991 crisis is the cautionary example. A country heavily dependent on short-term foreign borrowing ran out of reserves and was forced into reform under pressure. Since then India has built far larger foreign exchange reserves, and opened gradually to portfolio investment. Use 1991 to argue that financial globalisation brings both capital and vulnerability, and that the order in which a country opens up matters.

The link to Australia

The Australia-India Economic Cooperation and Trade Agreement (ECTA) came into force in December 2022. Two-way trade was around A$54.4 billion in 2024-25, and both governments have set a target of A$100 billion by 2030. Negotiations on a broader Comprehensive Economic Cooperation Agreement (CECA) were still continuing in October 2026, when trade ministers Piyush Goyal and Don Farrell met to discuss speeding them up.

The trade is complementary. Australia sells India resources, especially coal, and education, while India's growing middle class and infrastructure needs make it one of the few markets that could reduce Australia's dependence on China.

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2. Strategies to promote growth and development

Liberalisation since 1991

Trade and investment liberalisation is the foundational strategy. It worked for growth: India moved from the slow growth of the pre-reform decades to sustained rapid growth. Its limitation is distribution. The gains went disproportionately to sectors and regions that could use the opening, leaving agriculture behind.

Make in India and production incentives

Launched in 2014, Make in India aims to raise manufacturing's share of the economy and create the factory jobs that services have not. Production Linked Incentives are the main tool. Evaluate this one carefully. It has attracted electronics assembly, but subsidies paid per unit of output are expensive, and assembly often relies on imported components, so domestic value added and job creation can be lower than the headline output suggests.

Tax and market reform

The Goods and Services Tax, introduced in 2017, replaced a tangle of state and central taxes with a single national system, creating a unified domestic market for the first time. It reduced the cost of moving goods between states, which raises efficiency, though businesses faced high compliance costs early on.

Trade agreements

After stepping back from regional deals for years, India has signed several since 2022, including ECTA with Australia and a trade agreement with the UK in 2025. These give Indian exporters better market access in exchange for gradual tariff cuts at home, while India keeps protection on sensitive sectors such as agriculture and dairy.

The 2026 tariff rollercoaster

India's experience with the United States in 2025 and 2026 is an excellent current example of how exposed a growing economy is to other countries' protection.

By late 2025, Indian goods faced a 50% US tariff, made up of a 25% "reciprocal" tariff and a further 25% penalty linked to India's purchases of Russian oil. In February 2026, an interim deal cut the rate to 18% after India agreed to stop buying Russian oil and to reduce tariffs on US industrial and agricultural goods. Weeks later the US Supreme Court ruled those tariffs unlawful, and a temporary 10% global surcharge replaced them. Since 24 July 2026, Indian goods have faced a 10% US tariff under a new legal basis, the lower of the two rates applied to 60 trading partners. India's Commerce Ministry says nearly 45% of its exports to the US fall outside it entirely.

Use this to argue that trade policy uncertainty is itself a cost: firms deciding whether to build export capacity can't plan around a tariff that moved from 50% to 18% to 10% inside a year. Our US tariffs guide covers the legal sequence in more detail.

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3. The four effects you must be able to argue

Economic growth

Growth has been fast and has stayed fast: 7.1% in 2024-25 and 7.8% in 2025-26. The evaluation point is its composition. Services drive growth, but around 45% of India's workforce still works in agriculture, where productivity and incomes are low. Growth that creates few jobs relative to its size is sometimes called "jobless growth", and it is India's central economic problem. India has one of the youngest populations of any large economy. That is only a demographic dividend if the economy creates enough productive jobs for the people entering the workforce each year.

Quality of life

The poverty data is the strongest evidence of progress. On the World Bank's US$3 a day line, extreme poverty fell from 27.1% in 2011-12 to 5.3% in 2022-23. India's HDI rose from 0.676 to 0.685 between 2022 and 2023, which UNDP attributed mainly to improvements in schooling and income.

The limitation shows in the HDI rank itself. At 130th, India is still in the medium development group, and the gap between its growth rate and its HDI position shows that growth takes decades to turn into health and education outcomes. Female labour force participation, at about 40% against 79% for men, is another quality of life and growth issue at once: it limits women's economic independence and leaves a large share of potential output unused.

Distribution of income

This is where India gets interesting, because the headline measure and the underlying picture disagree.

The World Bank's Gini coefficient for India is 25.5, which ranks India among the most equal countries in the world. But that figure is based on consumption surveys, not income. Consumption is generally more equal than income, because richer households save more, and surveys tend to miss the very top. Research using tax and income data, such as the World Inequality Lab's 2024 study, finds the top 1% receiving more than a fifth of national income.

That disagreement is a gift in an exam. It lets you show the marker you understand how inequality is measured, which is the kind of evaluation of evidence the top band rewards. A sentence like "India's consumption Gini of 25.5 understates inequality, because consumption surveys exclude the savings of high-income households" does more work than another statistic.

Environmental sustainability

Rapid growth has come with serious environmental costs. Coal still generates most of India's electricity, and Indian cities have some of the worst air pollution in the world. India is the world's third-largest emitter of greenhouse gases in total, though its emissions per person are far below Australia's.

The response is substantial. India has committed to net zero emissions by 2070 and has expanded solar capacity rapidly. Use this to argue that India faces the same trade-off every developing economy does: cheap coal power supports growth and poverty reduction now, while clean energy requires investment whose benefits come later. The fact that emissions per person are low gives India a fairness argument in climate negotiations that richer economies don't have.

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4. Using India without writing a country report

Compare two versions of the same point.

Weak: "India liberalised its economy in 1991 and has grown quickly since, now growing at around 8% a year."

Strong: "India's experience shows that globalisation can raise growth rapidly without transforming employment. Liberalisation after the 1991 balance of payments crisis allowed India to specialise in skill-intensive services, sustaining growth of 7.8% in 2025-26, yet with around 45% of the workforce still in low-productivity agriculture and female participation near 40%, the gains have reached a relatively narrow, educated and urban share of the population."

Same facts. The second one is an argument with a mechanism, evidence and an implication.

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5. India against China

If a question asks you to compare, or you want a quick contrast to sharpen a point, this is the comparison that matters.

	China	India
Growth model	Manufacturing exports, high investment	Services exports, domestic consumption
Opening up	From 1978, gradual and state-directed	From 1991, triggered by crisis
Labour	Mass shift from farms to factories	Large share still in agriculture
Demographics	Ageing, shrinking workforce	Young, growing workforce
Development	HDI "very high"	HDI "medium"
Main development challenge	Rebalancing toward consumption	Creating enough productive jobs

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What the questions have looked like

India fits every recent question on an economy other than Australia: 2023 Question 27 (evaluate the impact of globalisation in achieving economic growth and development on an economy other than Australia), 2024 Question 24(c) (analyse the effects of globalisation on economic development), and 2021 Question 21(c) (evaluate strategies used to promote economic development).

Notice that two of those three are evaluate questions. Knowing what India did isn't enough. You need a judgement on how well it worked and for whom. The short version of that judgement for India: globalisation has delivered rapid growth and a large fall in extreme poverty, but the services-led path has not yet created enough productive jobs to turn that growth into broad-based development.

For model answers to those questions, see our worked solutions for 2023 and 2024.

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Sources: India Ministry of Statistics and Programme Implementation (National Accounts Statistics 2026, provisional estimates for 2025-26); IMF World Economic Outlook (October 2025); UNDP Human Development Report 2025; World Bank poverty and remittances data; India Periodic Labour Force Survey 2025; DFAT; World Inequality Lab (2024).