India’s Journey towards a $5 trillion economy

September 4, 2019

In 2016, India was a $2 trillion economy. After 2 years India was $3 trillion economy. So we wish to became a $5 trillion economy by 2024.

India’s Foreign Policy Approach

India's Foreign Policy Approach

India’s new approach is reflected in the foreign policy pillars of panchamrut.

  1. Samman (dignity and honour)
  2. Samvad (engagement and dialogue)
  3. Samriddhi (shared prosperity)
  4. Suraksha (regional and global security)
  5. Sanskriti evam Sabhyata

In line with the stated policy, the P.M. undertook his first visit to Maldives and Sri Lanka. It is attached to neighbourhood first policy. Also India is giving priority to SAGAR doctorine.

SAGAR refers to Security security and growth for all in the region.

In this regard PM of India travelled to Seychelles, Mauritius, Sri Lanka and outlined the SAGAR concept.

Mauritius is the country which having high percentage of FDI in India. the presence of PM of Mauritius during the oath taking of PM of India in 2019 was significant indicator in that direction.

Achieving a $5 trillion economy

At the governing council meeting of the NITI aayog,

PM announced a target of $5 trillion economy by 2024.

This transformation does not come with the modest plans

Economic survey showing objective

The economic survey has pegged a GDP growth rate at 7% for financial year 20 up from 6.8% in previous fiscal and to achieve the $5 trillion economy the economic survey has laid a roadmap where it says that India must growth at 8%.

Survey has chapter namely ‘shifting of gears‘ to achieve the objective of becoming a $5 trillion economy by 2024 – 25.

  1. Private investment as the key driver that drives demand create capacity increasing, labour productivity, introducing new technology and generates jobs.
  2. there is a need for the government to focus on smoothening the process of private investment into infrastructure and other areas.
Economic survey showing objective

Focus on MSME Sector

  • The MSME Sector helps to generate 30% of the country’s economic output and total employment generation.
  • Government has undertaken several transformational reform in MSME Sector.

Focus on agriculture sector

Focus on agriculture sector
  • 50% population of India lives in villages and engaging in the agricultural activity.
  • The government has committed to double the farmers income by 2022.
  • Today no industrial Nation can survive without agriculture.

Farmer’s income can be decided only by the products that can be converted into values.

Some steps have been taken by the govt. towards selling farmer’s produce at better prices. Grameen agricultural market linking with eNAM was a great initiative.

By this initiative, anyone can sell their products nationally.

Focus on Service Sector

  • Services contributed to 56.5 percent of GDP but creates only 30% of jobs.
  • These are the following services that contribute to GDP as
    • IT sector
    • Travel and tourism
    • Healthcare

Opportunity in Digital India

  • It was launched in 1st July 2015.
  • India can create $1 trillion dollar of economic values from the digital economy in 2025.

Finally, there is no doubt diet how quickly policymakers are able to provide the policy push will decide how fast we can achieve our goal of $5 trillion economy by 2024.

To conclude, it is absolutely essential to work on a framework that provides ease of doing business and predictability.

It is also time to redirect energies on providing the environment to encourage private sector investment and innovation.

Further Reading

A Blueprint to $5 trillion economy

Economic Survey lays out a blueprint for $5 trillion economy
A blueprint for a $5-trillion economy

PM’s Independence Day Address to the Nation

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