During an event by UNDP India, Chief Economic Advisor Anantha Nageswaran said that India is as of now a $3.3 trillion and if we simply assume 10 percent nominal GDP growth in dollar terms, you get to $ 10 trillion by 2033-34.
He also said India is relatively better off than other emerging economies.
CHIEF ECONOMIC ADVISOR :ANANTHA NAGESWARAN | Livemint.com
Prime Minister Narendra Modi had a vision to make India a USD 5 trillion economy by 2019 and global powerhouse by 2024-25.
According to him GDP is the worst economic measure of economic activities because everything you take comes with its own limitations and serious subjectivity.
The World Bank cut down India’s economic growth forecast for the current fiscal year to 7.5 per cent.
Reasons included rising inflation, supply chain disruptions and geopolitical tensions and their slow recovery after the pandemic.
For the last fiscal year India grew at a rate of 8.7 percent in 2021-22 against a 6.6 percent contraction in the previous year. From 2022-23 the Reserve Bank Of India continued its GDP growth forecast at 7.2 percent for the current fiscal year.
The negative spillover of geopolitical tensions and a slowdown in the economy can be a reason to worry about.
Mr. Chidambaram, a member of the Rajya Sabha said “ the goal of a USD 5 trillion GDP appears to be a case of ‘shifting goalposts’ “ in response to V. Anantha Nageswaran`s statement. Mr. Chidambaram suggested that we follow the U.S. economic model.
Rajeev Chandrasekhar a BJP politician from Kerala and Minister of State for Skill Development and Entrepreneurship and Electronics and Information Technology of India called Chidambaram`s view extremely wrong and even said he has been continuously wrong.
He said the goal of becoming a $5 trillion economy by 2026 is achievable.
India is likely to get to top 5 this fiscal year and also one spot ahead to overtake Germany in the next 5 years.
The forecasts are believable and given the gap between India and Germany for 2027 is about $20 billion plus, despite a downward revision in estimates , chances of India in the Top 5 are quite strong.
The pace of output growth in certain areas of the world is slowing down due to reasons like Brexit , Ukraine – Russia war and covid related disruptions helping India’s rise in position worldwide.
The IMF estimates India to overtake Britain`s $3.38 trillion economy by becoming a $3.53 trillion economy. India is also expected to overtake Germany by 2027 and emerge as the fourth largest economy in the world.
Japan is at the third spot and if India`s target of 7-8% real GDP growth rate continues, India can compete with Japan`s spot in the worldwide economy. This is both doable and not overambitious. Overtaking China after that will be a challenge for India.
Some experts argued that the target of 8-9% sustained growth is beyond reach in the current circumstances. Former Reserve Bank of India Governor C. Rangarajan said last year that India needs to grow at 9% per annum to achieve that.
There have been many setbacks for India because of Covid-19 and Russia-Ukraine war which affected the global economy and in turn India. India is expected to overcome Covid losses in 2034-35 according to RBI`s research team.
There also have been revisions in the IMF`s data. The new predictions show that India will only be able to reach its target of $5 trillion by 2026-27 and the new forecast also predicted that India could become a $5.5 trillion economy by 2027-28.
They also addressed the claim that Bangladesh has overtaken India in terms of GDP per capita and revised it. The new claim is that the per capita GDP of India will remain ahead of Bangladesh till 2027.
