Rama Krishna Sangem
India must aim to accelerate its pace of growth to 9-10 per cent over a three-decade period, said Amitabh Kant, former chief executive officer of NITI Aayog and India’s G20 Sherpa, at the Confederation of Indian Industry (CII) Southern Regional Annual Regional Meeting 2024 in Bengaluru on March 21, Thursday.
Kant suggested that if India grows at 10 per cent, it would mean the gross domestic product (GDP) would surpass $35 trillion, elevating the per capita income to around $24,000. Present 7-8 per cent growth rate of GDP is not enough for India to achieve its goals of becoming a developed country or cross 5 trillion US dollar economy soon.
It is very important that our ambition cannot be 7 per cent or 7.5 per cent, it must be very high to make a 10 per cent growth over a three-decade period. India cannot grow at all on the back of the services sector. India needs to grow on the back of manufacturing, smart urbanization, and agriculture. India cannot grow only on the back of the central government, it will only grow if the States grow,” Kant said.
India has potential to grow
Kant emphasised India’s potential to outpace Japan and Germany, projecting it to become the world’s third-largest economy by 2027. He further forecasted India’s ascent to the third-largest stock market by the same year’s end.
“India has emerged as a resilient powerhouse during the last three quarters and is an oasis of growth. This is once in a generation economic shift that is taking place, in its economic position – a rare movement,” Kant added.
Kant shed light on India’s consistent growth, surpassing 8.3 per cent in the last three quarters. According to the International Monetary Fund (IMF), India is anticipated to contribute about 20 per cent of the world’s economic expansion in the next decade.
Must transform from farm to manufacturing
Discussing India’s anticipated growth, Kant suggested transitioning people from agriculture to manufacturing-led smart cities to create better-quality jobs and foster economic development.
“The challenge with India is that 42 per cent of our population is in agriculture. About 18-19 per cent of the GDP is coming from agriculture which is too high as the world average is about 5-6 per cent,” added Kant. Kant emphasised the significance of bolstering India’s manufacturing sector, highlighting its potential to equip the nation with the necessary size and scale to effectively enter the global market.
“We need to dig close to 5 per cent of the global trade and for that to happen, we need to grow manufacturing which is what we are doing through Production Linked Incentive (PLI),” the former chief executive officer of NITI Aayog felt. A lot also needs to be done on human capital expansion front too, the conclave opined.
