India’s economy has the potential to achieve an impressive 8% growth rate annually until 2047, according to Krishnamurthy Venkata Subramanian, the country’s executive director at the International Monetary Fund (IMF). However, this ambitious target hinges on redoubling successful policies implemented over the past decade and accelerating reforms.
Subramanian acknowledges the challenging nature of this goal, considering India’s historical growth patterns haven’t consistently reached 8%. Yet, he remains optimistic about its achievability.
“By capitalizing on the strong growth momentum witnessed in the past ten years, and by effectively building upon the positive policies enacted during that period, India can propel itself towards an 8% growth trajectory for the next two and a half decades,” he remarked at the Times Now Summit.
India’s economic performance has been positive recently, with the final quarter of 2023 showcasing a growth rate of 8.4%, the fastest pace in the last 18 months. This robust performance has bolstered the current fiscal year’s growth estimate to 7.6%.
Reaching the projected 8% growth rate would translate into a staggering $55 trillion Indian economy by 2047, according to Subramanian. He also highlighted India’s historical economic advantage, with an average growth exceeding 7% since 1991.
Subramanian emphasized the importance of strengthening the domestic economy, considering that roughly 58% of India’s GDP is driven by domestic consumption. He further stressed the need to bolster the manufacturing sector as a key driver of job creation.
“We need to focus on reforms in the manufacturing sector, but simultaneously, our banking sector also requires reforms to ensure credit accessibility for manufacturers,” Subramanian noted.
