New Delhi: Indian economy is growing at a robust pace, but the growth rate may need to pick up significantly if Prime Minister Narendra Modi wants the country to become developed by 2047, economists said.
The latest quarter is likely to show India with economic growth of over 7%. The result is good relative to many other major economies, but could be a little less than it should be in order to catch up with the developed economies.
With India celebrating 100 years of independence in 2047, Modi has outlined his vision of ‘Viksit Bharat’ with the goal of transforming India into a developed nation by then. To achieve this, India had to implement an average annual growth rate of approximately 9.25% for the next 21 years, Ashok Lahiri, a senior official of NITI Aayog, asserted. This has been far higher than the country’s average rate of growth.
Investment and Jobs Remain Major Challenges
The greatest difficulty is to boost private capital. While India has been able to lure in substantial foreign investment, this money has not remained in India for long periods of time. Meanwhile, Indian businesses have also started investing abroad. Economists have said that more robust and consistent investment is required to establish factories, infrastructure and businesses that can generate job opportunities.
Domestic saving is another matter of concern. India saves more than other countries have an average, but not as much as some other Asian countries, notably China. Not only does this impose a limit on how much money that most families can save once their bills are paid, but it makes it harder for them to save at all when they have lower household incomes.
Creating jobs is also of great importance. India has a huge youth population that may be an economic boon for the country in the coming years. But economics experts caution that the upturn could be squandered if there is not enough good employment.
According to a recent report by the NITI Aayog, which was released in June 2022, of the India’s working-age population (15-29 years), there were nearly 87 million people who were engaged neither in work, nor in training nor in education. About 60% of the labor force is also self-employed, and many work in lower level activities such as agriculture.
Manufacturing Needs a Bigger Push
Indian growth needs to be accelerated to achieve faster manufacturing growth, exports, and private capital inflows to attain the goal of becoming a developed India by 2047, according to economists. The government is also attempting to lure more foreign firms for manufacturing in India.
India’s economy is still one of the fastest growing of major economies. For sustained growth of 8% or more, though, extensive enhancements of investment, employment, skills and productivity will be needed, experts said.
The aim of the government, therefore, is not just to ensure India’s continued growth, but to accelerate and widen it, and to enhance incomes and opportunities for millions of Indians.
