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Based on a sample during 1978-2014, this paper finds that India's real GDP has a positive relationship with real depreciation during 1978-2002, the government debt/GDP ratio, the real stock price, the growth rate of U.S. real GDP, and a negative relationship with real depreciation during 2003-2014, the real lending rate and the expected inflation rate. Therefore, the stage of economic development may play an important role in deciding whether real depreciation or real appreciation may promote economic growth. [ABSTRACT FROM AUTHOR]

Advocates of growth diagnostics have shown it to be a preferable alternative to other methods of formulating a growth strategy such as cross-country regressions, growth accounting or international benchmarking using cross country surveys. We show that growth diagnostics also suffers from problems and demands a high level of economic sophistication from its practitioners. We suggest a simpler prelude before launching into rigorous analysis and apply this method to address the puzzle of Pakistan's lagging per capita GDP relative to India. [ABSTRACT FROM AUTHOR]