New Delhi: The Indian economy is expected to become the third largest in the world having a size of $5-trillion in the next 3 years as the financial year 2023-24 marks the third successive year of over 7 per cent GDP growth. Besides, the country’s economy will touch $7-trillion by 2030 on the back of continued reforms, the government said on Monday.
“In the next three years, India is expected to become the third-largest economy in the world, with a GDP of $5-trillion and to touch $7-trillion by 2030 on the back of continued reforms. The government has, however, set a higher goal of becoming a ‘developed country’ by 2047. With the journey of reforms continuing, this goal is achievable,” the finance ministry said in its review report.
Finance Minister Nirmala Sitharaman will present the budget on February 1, factoring in the growth projections. “The robustness seen in domestic demand, namely, private consumption and investment, traces its origin to the reforms and measures implemented by the government over the last ten years,” the review said.
Ten years ago, India was the 10th largest economy in the world, with a GDP of $1.9-trillion at current market prices. “This 10-year journey is marked by several reforms, both substantive and incremental, which have significantly contributed to the country’s. Today, it is the 5th largest with a GDP of $3.7 trillion, despite the pandemic and inheriting an economy with macro imbalances and a broken financial sector, said the ministry’s economic review.
The Nirmala Sitharaman-headed ministry stressed that the reforms will be more purposeful and fruitful with full participation of state governments. “These reforms have also delivered an economic resilience that the country will need to deal with unanticipated global shocks in the future,” the review said.
As far as the government’s reforms are concerned, the review further said that participation of states would be fuller when reforms encompass changes in governance at the district, block, and village levels, making them citizen-friendly and small business-friendly and in areas such as health, education, land and labour, in which states have a big role to play.
“The strength of the domestic demand has driven the economy to a 7 per cent plus growth rate in the last three years. In FY25, real GDP growth will likely be closer to 7 per cent,” said the report, ddding that there is, however, considerable scope for the growth rate to rise well above 7 per cent by 2030.
In the preface of the review report, chief economic adviser V Anantha Nageswaran said the Union government has built infrastructure at a historically unprecedented rate, and it has taken the overall public sector capital investment from Rs 5.6 lakh crore in FY15 to Rs 18.6 lakh crore in FY24, as per budget estimates.
“The global economy is struggling to maintain its recovery post-Covid because successive shocks have buffeted it. Some of them, such as supply chain disruptions, have returned in 2024,” he noted.
